UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K
x
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE FISCAL YEAR ENDED
DECEMBER 31, 2012
Or
o
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE TRANSITION PERIOD FROM ____________ TO _______________
COMMISSION FILE NO. 1-12494
______________
CBL & ASSOCIATES PROPERTIES, INC.
(Exact Name of Registrant as Specified in Its Charter)
|
|
|
|
Delaware
(State or other jurisdiction of incorporation or organization)
|
|
62-1545718
(I.R.S. Employer Identification No.)
|
|
|
|
|
2030 Hamilton Place Blvd., Suite 500
Chattanooga, TN
(Address of principal executive offices)
|
|
37421
(Zip Code)
|
Registrant’s telephone number, including area code:
423.855.0001
Securities registered pursuant to Section 12(b) of the Act:
|
|
|
|
Title of each Class
|
|
Name of each exchange on
which registered
|
Common Stock, $0.01 par value
|
|
New York Stock Exchange
|
7.375% Series D Cumulative Redeemable Preferred Stock, $0.01 par value
|
|
New York Stock Exchange
|
6.625% Series E Cumulative Redeemable Preferred Stock, $0.01 par value
|
|
New York Stock Exchange
|
Securities registered pursuant to Section 12(g) of the Act: None
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§229.405 of this chapter) is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.
o
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer,” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.
|
|
|
Large accelerated filer
x
|
Accelerated filer
o
|
Non-accelerated filer
o
(Do not check if a smaller reporting
company)
|
Smaller Reporting Company
o
|
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
The aggregate market value of the
152,114,757
shares of common stock held by non-affiliates of the registrant as of
June 30, 2012
was
$2,972,322,352
, based on the closing price of $19.54 per share on the New York Stock Exchange on June 29, 2012. (For this computation, the registrant has excluded the market value of all shares of its common stock reported as beneficially owned by executive officers and directors of the registrant; s
uch exclusion shall not be deemed to constitute an admission that any such person is an “affiliate” of the registrant.)
As of
February 28, 2013
,
161,497,204
shares of common stock were outstanding.
DOCUMENTS INCORPORATED BY REFERENCE
Portions of the Registrant’s Proxy Statement for the 2013 Annual Meeting of Stockholders are incorporated by reference in
Part III
.
TABLE OF CONTENTS
Cautionary Statement Regarding Forward-Looking Statements
Certain statements included or incorporated by reference in this Annual Report on Form 10-K may be deemed “forward looking statements” within the meaning of the federal securities laws. All statements other than statements of historical fact should be considered to be forward-looking statements. In many cases, these forward looking statements may be identified by the use of words such as “will,” “may,” “should,” “could,” “believes,” “expects,” “anticipates,” “estimates,” “intends,” “projects,” “goals,” “objectives,” “targets,” “predicts,” “plans,” “seeks,” or similar expressions. Any forward-looking statement speaks only as of the date on which it is made and is qualified in its entirety by reference to the factors discussed throughout this report.
Although we believe the expectations reflected in any forward-looking statements are based on reasonable assumptions, forward-looking statements are not guarantees of future performance or results and we can give no assurance that these expectations will be attained. It is possible that actual results may differ materially from those indicated by these forward-looking statements due to a variety of known and unknown risks and uncertainties. In addition to the risk factors discussed in Part I, Item 1A of this report, such known risks and uncertainties include, without limitation:
|
|
•
|
general industry, economic and business conditions;
|
|
|
•
|
interest rate fluctuations;
|
|
|
•
|
costs and availability of capital and capital requirements;
|
|
|
•
|
costs and availability of real estate;
|
|
|
•
|
inability to consummate acquisition opportunities and other risks associated with acquisitions;
|
|
|
•
|
competition from other companies and retail formats;
|
|
|
•
|
changes in retail rental rates in our markets;
|
|
|
•
|
shifts in customer demands;
|
|
|
•
|
tenant bankruptcies or store closings;
|
|
|
•
|
changes in vacancy rates at our properties;
|
|
|
•
|
changes in operating expenses;
|
|
|
•
|
changes in applicable laws, rules and regulations; and
|
|
|
•
|
the ability to obtain suitable equity and/or debt financing and the continued availability of financing in the amounts and on the terms necessary to support our future refinancing requirements and business.
|
This list of risks and uncertainties is only a summary and is not intended to be exhaustive. We disclaim any obligation to update or revise any forward-looking statements to reflect actual results or changes in the factors affecting the forward-looking information.
PART I
ITEM 1. BUSINESS
Background
CBL & Associates Properties, Inc. (“CBL”) was organized on July 13, 1993, as a Delaware corporation, to acquire substantially all of the real estate properties owned by CBL & Associates, Inc., which was formed by Charles B. Lebovitz in 1978, and by certain of its related parties. On November 3, 1993, CBL completed an initial public offering (the “Offering”). Simultaneous with the completion of the Offering, CBL & Associates, Inc., its shareholders and affiliates and certain senior officers of the Company (collectively, “CBL’s Predecessor”) transferred substantially all of their interests in its real estate properties to CBL & Associates Limited Partnership (the “Operating Partnership”) in exchange for common units of limited partner interest in the Operating Partnership. The interests in the Operating Partnership contain certain conversion rights that are more fully described in
Note 8
to the consolidated financial statements. The terms “we”, “us”, “our” and the “Company” refer to CBL and its subsidiaries.
The Company’s Business
We are a self-managed, self-administered, fully integrated real estate investment trust (“REIT”). We own, develop, acquire, lease, manage, and operate regional shopping malls, open-air centers, associated centers, community centers and office properties. Our properties are located in
27
states, but are primarily in the southeastern and midwestern United States. We have elected to be taxed as a REIT for federal income tax purposes.
We conduct substantially all of our business through the Operating Partnership. We are the
100%
owner of
two
qualified REIT subsidiaries, CBL Holdings I, Inc. and CBL Holdings II, Inc. CBL Holdings I, Inc. is the sole general partner of the Operating Partnership. At
December 31, 2012
, CBL Holdings I, Inc. owned a
1.0%
general partner interest and CBL Holdings
II, Inc. owned a
83.5%
limited partner interest in the Operating Partnership, for a combined interest held by us of
84.5%
.
As of
December 31, 2012
, we owned:
|
|
▪
|
controlling interests in
77
regional malls/open-air and outlet centers (including one mixed-use center) and noncontrolling interests in
nine
regional malls (the “Malls”), controlling interests in
28
associated centers and noncontrolling interests in
four
associated centers (the “Associated Centers”), controlling interests in
six
community centers and noncontrolling interests in
four
community centers (the “Community Centers”), and controlling interests in
13
office buildings which include our corporate office building and noncontrolling interests in
seven
office buildings (the “Office Buildings”);
|
|
|
▪
|
controlling interests in the development of
one
outlet center owned in a
75%
/
25%
joint venture,
one
community center,
one
mall expansion, and
two
mall redevelopments that are under construction at
December 31, 2012
(the "Construction Properties"), as well as options to acquire certain shopping center development sites; and
|
|
|
▪
|
mortgages on
six
properties, each of which is collateralized by either a first mortgage, a second mortgage or by assignment of 100% of the ownership interests in the underlying real estate and related improvements (the “Mortgages”).
|
The Malls, Associated Centers, Community Centers, Office Buildings, Construction Properties and Mortgages are collectively referred to as the “Properties” and individually as a “Property.”
We conduct our property management and development activities through CBL & Associates Management, Inc. (the “Management Company”) to comply with certain requirements of the Internal Revenue Code of 1986, as amended (the "Internal Revenue Code"). The Operating Partnership owns
100%
of the Management Company’s outstanding preferred stock and common stock.
The Management Company manages all but 13 of the Properties. Governor’s Square and Governor’s Plaza in Clarksville, TN and Kentucky Oaks Mall in Paducah, KY are all owned by unconsolidated joint ventures and are managed by a property manager that is affiliated with the third party managing general partner, which receives a fee for its services. The managing general partner of each of these Properties controls the cash flow distributions, although our approval is required for certain major decisions. The Outlet Shoppes at Oklahoma City in Oklahoma City, OK, The Outlet Shoppes at Gettysburg in Gettysburg, PA, The Outlet Shoppes at El Paso in El Paso, TX and Kirkwood Mall in Bismarck, ND are owned by consolidated joint ventures and managed by a property manager that is affiliated with the third party partner or a third party property manager, which receives a fee for its services. Further, we have contracted with a third-party firm that provides property management services to oversee the operations of our six office buildings located in Chesapeake, VA and Newport News, VA. The firm receives a fee for its services.
Revenues are primarily derived from leases with retail tenants and generally include fixed minimum rents, percentage rents based on tenants’ sales volumes and reimbursements from tenants for expenditures related to real estate taxes, insurance, common area maintenance and other recoverable operating expenses, as well as certain capital expenditures. We also generate revenues from management, leasing and development fees, advertising, sponsorships, sales of peripheral land at the Properties and from sales of operating real estate assets when it is determined that we can realize a premium value for the assets. Proceeds from such sales are generally used to retire related indebtedness or reduce borrowings on our credit facilities.
The following terms used in this Annual Report on Form 10-K will have the meanings described below:
|
|
▪
|
GLA – refers to gross leasable area of retail space in square feet, including anchors and mall tenants.
|
|
|
▪
|
Anchor – refers to a department store or other large retail store greater than or equal to 50,000 square feet.
|
|
|
▪
|
Junior Anchor - non-traditional department store or retail store comprising more than 20,000 square feet and less than 50,000 square feet.
|
|
|
▪
|
Freestanding – property locations that are not attached to the primary complex of buildings that comprise the mall shopping center.
|
|
|
▪
|
Outparcel – land used for freestanding developments, such as retail stores, banks and restaurants, which are generally on the periphery of the Properties.
|
Significant Markets and Tenants
Top Five Markets
Our top five markets, based on percentage of total revenues, were as follows for the year ended
December 31, 2012
:
|
|
|
|
Market
|
|
Percentage
of Total
Revenues
|
St. Louis, MO
|
|
8.2%
|
Chattanooga, TN
|
|
3.7%
|
Madison, WI
|
|
3.2%
|
Lexington, KY
|
|
2.8%
|
Nashville, TN
|
|
2.7%
|
Top 25 Tenants
Our top 25 tenants based on percentage of total revenues were as follows for the year ended
December 31, 2012
:
|
|
|
|
|
|
|
|
|
|
|
Tenant
|
|
Number
of Stores
|
|
Square Feet
|
|
Percentage
of Total
Revenues
|
Limited Brands, LLC
(1)
|
|
164
|
|
|
833,011
|
|
|
3.20
|
%
|
Foot Locker, Inc.
|
|
170
|
|
|
659,326
|
|
|
2.38
|
%
|
AE Outfitters Retail Company
|
|
88
|
|
|
519,768
|
|
|
2.06
|
%
|
The Gap, Inc.
|
|
76
|
|
|
856,426
|
|
|
1.73
|
%
|
Signet Group plc
(2)
|
|
113
|
|
|
205,040
|
|
|
1.72
|
%
|
Genesco Inc.
(3)
|
|
200
|
|
|
298,382
|
|
|
1.60
|
%
|
JC Penney Company, Inc.
(4)
|
|
75
|
|
|
8,749,756
|
|
|
1.58
|
%
|
Abercrombie & Fitch, Co.
|
|
76
|
|
|
515,660
|
|
|
1.56
|
%
|
Dick's Sporting Goods, Inc.
|
|
22
|
|
|
1,272,713
|
|
|
1.44
|
%
|
Luxottica Group, S.P.A.
(5)
|
|
129
|
|
|
284,587
|
|
|
1.35
|
%
|
Dress Barn, Inc.
(6)
|
|
131
|
|
|
619,906
|
|
|
1.35
|
%
|
Express Fashions
|
|
49
|
|
|
409,730
|
|
|
1.30
|
%
|
Aeropostale, Inc.
|
|
89
|
|
|
324,083
|
|
|
1.30
|
%
|
Zale Corporation
|
|
131
|
|
|
137,469
|
|
|
1.21
|
%
|
Finish Line, Inc.
|
|
69
|
|
|
365,663
|
|
|
1.19
|
%
|
New York & Company, Inc.
|
|
50
|
|
|
357,670
|
|
|
1.04
|
%
|
Best Buy Co., Inc.
(7)
|
|
67
|
|
|
554,025
|
|
|
1.02
|
%
|
Sun Capital Partners, Inc.
(8)
|
|
54
|
|
|
650,688
|
|
|
0.98
|
%
|
Forever 21 Retail, Inc.
|
|
23
|
|
|
421,545
|
|
|
0.98
|
%
|
The Buckle, Inc.
|
|
51
|
|
|
256,655
|
|
|
0.93
|
%
|
Charlotte Russe Holding, Inc.
|
|
52
|
|
|
356,146
|
|
|
0.91
|
%
|
The Children's Place Retail Stores, Inc.
|
|
60
|
|
|
265,012
|
|
|
0.85
|
%
|
Claire's Stores, Inc.
|
|
122
|
|
|
144,258
|
|
|
0.81
|
%
|
Christopher & Banks, Inc.
|
|
73
|
|
|
252,065
|
|
|
0.77
|
%
|
Sears, Roebuck and Co.
(9)
|
|
70
|
|
|
9,344,328
|
|
|
0.76
|
%
|
|
|
2,204
|
|
|
28,653,912
|
|
|
34.02
|
%
|
|
|
(1)
|
Limited Brands, LLC operates Victoria's Secret and Bath & Body Works.
|
|
|
(2)
|
Signet Group plc operates Kay Jewelers, Marks & Morgan, JB Robinson, Shaw's Jewelers, Osterman's Jewelers, LeRoy's Jewelers, Jared Jewelers, Belden Jewelers and Rogers Jewelers.
|
|
|
(3)
|
Genesco Inc. operates Journey's, Jarman, Underground Station, Hat World, Lids, Hat Zone, and Cap Factory stores.
|
|
|
(4)
|
JC Penney Company, Inc. owns 36 of these stores.
|
|
|
(5)
|
Luxottica Group, S.P.A. operates Lenscrafters, Sunglass Hut, and Pearle Vision.
|
|
|
(6)
|
Dress Barn, Inc. operates Justice, dressbarn and maurices.
|
|
|
(7)
|
Best Buy Co,, Inc. operates Best Buy and Best Buy Mobile.
|
|
|
(8)
|
Sun Capital Partners, Inc. operates Gordmans, Life Uniform, Limited Stores, Fazoli's Restaurants, Smokey Bones, and Bar Louie Restaurants.
|
|
|
(9)
|
Sears, Roebuck and Co. owns 50 of these stores.
|
Growth Strategy
Our objective is to achieve growth in funds from operations (s
ee page 70 for a discussion of funds from operations) by maximizing cash flows through a variety of methods as further discussed below.
Leasing, Management and Marketing
Our objective is to maximize cash flows from our existing Properties through:
|
|
▪
|
aggressive leasing that seeks to increase occupancy and facilitate an optimal merchandise mix,
|
|
|
▪
|
originating and renewing leases at higher gross rents per square foot compared to the previous lease,
|
|
|
▪
|
merchandising, marketing, sponsorship and promotional activities and
|
|
|
▪
|
actively controlling operating costs and resulting tenant occupancy costs.
|
Redevelopments
Redevelopments represent situations where we capitalize on opportunities to add incremental square footage or increase the productivity of previously occupied space through aesthetic upgrades, retenanting and/or changing the retail use of the space. Many times, redevelopments result from acquiring possession of anchor space and subdividing it into multiple spaces. The following presents the redevelopments we completed during
2012
and those under construction at
December 31, 2012
:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Property
|
|
Location
|
|
Total Project
Square Feet
|
|
Total
Cost
(1)
|
|
Cost to
Date
(2)
|
Opening Date
|
Completed in 2012:
|
|
|
|
|
|
|
|
|
|
Foothills Mall/Plaza - Carmike Cinema
|
|
Maryville, TN
|
|
45,276
|
|
|
$
|
8,337
|
|
|
$
|
8,718
|
|
March 2012
|
|
|
|
|
|
|
|
|
|
|
Currently under construction:
|
|
|
|
|
|
|
|
|
|
Monroeville Mall - JC Penney/Cinemark
|
|
Pittsburgh, PA
|
|
464,792
|
|
|
$
|
26,178
|
|
|
$
|
8,784
|
|
October 2012/Winter 2013
|
Southpark Mall - Dick's Sporting Goods
|
|
Colonial Heights, VA
|
|
91,770
|
|
|
9,891
|
|
|
860
|
|
Fall 2013
|
|
|
|
|
556,562
|
|
|
$
|
36,069
|
|
|
$
|
9,644
|
|
|
|
|
(1)
|
Total cost is presented net of reimbursements to be received.
|
|
|
(2)
|
Cost to date does not reflect reimbursements until they are received.
|
Our total cost of the redevelopment projects completed in 2012 was $8.3 million. Our total investment upon completion of redevelopment projects that are under construction as of
December 31, 2012
is projected to be $36.1 million.
Renovations
Renovations usually include remodeling and upgrading existing facades, uniform signage, new entrances and floor coverings, updating interior décor, resurfacing parking lots and improving the lighting of interiors and parking lots. Renovations can result in attracting new retailers, increased rental rates, sales and occupancy levels and maintaining the Property's market dominance. During 2012, we completed renovations at four of our malls including Cross Creek Mall in Fayetteville, NC; Post Oak Mall in College Station, TX; Turtle Creek Mall in Hattiesburg, MS and Mall del Norte in Laredo, TX. Our 2013 renovation plan includes Friendly Center in Greensboro, NC; Greenbrier Mall in Chesapeake, VA; Acadiana Mall in Lafayette, LA and Northgate Mall in Chattanooga, TN. Renovation expenditures for 2012 also include certain capital expenditures related to the parking decks at West County Center that we are required to fund under the terms of the joint venture we formed with TIAA-CREF.
We invested $28.1 million in renovations in 2012. The total investment in the renovations that are scheduled for 2013 is projected to be $24.7 million.
Development of New Retail Properties and Expansions
In general, we seek development opportunities in middle-market trade areas that we believe are under-served by existing retail operations. These middle-markets must also have sufficient demographics to provide the opportunity to effectively maintain a competitive position. The following presents the new developments we opened during
2012
and those under construction at
December 31, 2012
:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Property
|
|
Location
|
|
Total Project
Square Feet
|
|
Total
Cost
(1)
|
|
Cost to
Date
(2)
|
|
Opening Date
|
Completed in 2012:
|
|
|
|
|
|
|
|
|
|
|
Waynesville Commons
|
|
Waynesville, NC
|
|
127,585
|
|
|
$
|
9,987
|
|
|
$
|
9,505
|
|
|
October 2012
|
|
|
|
|
|
|
|
|
|
|
|
Currently under construction:
|
|
|
|
|
|
|
|
|
|
|
The Crossings at Marshalls Creek
|
|
Middle Smithfield, PA
|
|
104,525
|
|
|
$
|
18,983
|
|
|
$
|
11,312
|
|
|
Summer 2013
|
The Outlet Shoppes at Atlanta
(3)
|
|
Woodstock, GA
|
|
370,456
|
|
|
80,490
|
|
|
31,468
|
|
|
Summer 2013
|
|
|
|
|
474,981
|
|
|
$
|
99,473
|
|
|
$
|
42,780
|
|
|
|
|
|
(1)
|
Total cost is presented net of reimbursements to be received.
|
|
|
(2)
|
Cost to date does not reflect reimbursements until they are received.
|
|
|
(3)
|
This Property is a 75/25 joint ventures. Total cost and cost to date are reflected at 100%.
|
We can also generate additional revenues by expanding a Property through the addition of department stores, mall stores and large retail formats. An expansion also protects the Property's competitive position within its market. The following presents the expansions that were completed during
2012
and those under construction at
December 31, 2012
:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Property
|
|
Location
|
|
Total Project
Square Feet
|
|
Total
Cost
(1)
|
|
Cost to
Date
(2)
|
|
Opening Date
|
Completed in 2012:
|
|
|
|
|
|
|
|
|
|
|
The Forum at Grandview - Phase II
(3)
|
|
Madison, MS
|
|
83,060
|
|
|
$
|
16,826
|
|
|
$
|
13,119
|
|
|
April 2012
|
The Outlet Shoppes at Oklahoma City - Phase II
(3)
|
|
Oklahoma City, OK
|
|
27,850
|
|
|
6,668
|
|
|
5,055
|
|
|
November 2012
|
The Shoppes at Southaven Towne Center - Phase I
|
|
Southaven, MS
|
|
15,557
|
|
|
1,828
|
|
|
1,614
|
|
|
November 2012
|
|
|
|
|
126,467
|
|
|
$
|
25,322
|
|
|
$
|
19,788
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Currently under construction:
|
|
|
|
|
|
|
|
|
|
|
|
Volusia Mall - Restaurant District
|
|
Daytona Beach, FL
|
|
28,000
|
|
|
$
|
8,951
|
|
|
$
|
4,107
|
|
|
Fall 2013
|
|
|
(1)
|
Total cost is presented net of reimbursements to be received.
|
|
|
(2)
|
Cost to date does not reflect reimbursements until they are received.
|
|
|
(3)
|
These Properties are 75/25 joint ventures. Total cost and cost to date are reflected at 100%.
|
The total cost of the new Property and expansions that opened in
2012
was $35.3 million, our share of which is $29.4 million. The cost of the new and expanded Properties under construction as of
December 31, 2012
is projected to be $108.4 million, our share of which is $88.3 million.
Acquisitions
We believe there is opportunity for growth through acquisitions of regional malls and other associated properties that complement our portfolio. We selectively acquire properties we believe can appreciate in value through our development, leasing and management expertise. In December 2012, we acquired a
49.0%
interest in Kirkwood Mall in Bismarck, ND as well as the remaining
40.0%
noncontrolling interest in Imperial Valley Mall and Commons in El Centro, CA. We expect to acquire the remaining
51.0%
interest in Kirkwood Mall in 2013. In May 2012, we acquired Dakota Square Mall located in Minot, ND. We also increased our investment in outlet centers through the acquisition of interests in The Outlet Shoppes at Gettysburg and The Outlet Shoppes at El Paso in the second quarter of 2012. See
Note 3
to the consolidated financial statements for further information about these acquisitions.
Environmental Matters
A discussion of the current effects and potential future impacts on our business and Properties of compliance with
federal, state and local environmental regulations is presented in
Item 1A
of this Annual Report on Form 10-K under the subheading “Risks Related to Real Estate Investments.”
Competition
The Properties compete with various shopping facilities in attracting retailers to lease space. In addition, retailers at our Properties face competition from discount shopping centers, outlet centers, wholesale clubs, direct mail, television shopping networks, the internet and other retail shopping developments. The extent of the retail competition varies from market to market. We work aggressively to attract customers through marketing promotions and campaigns.
Seasonality
The shopping center business is, to some extent, seasonal in nature with tenants typically achieving the highest levels of sales during the fourth quarter due to the holiday season, which generally results in higher percentage rent income in the fourth quarter. Additionally, the Malls earn most of their “temporary” rents (rents from short-term tenants) during the holiday period. Thus, occupancy levels and revenue production are generally the highest in the fourth quarter of each year. Results of operations realized in any one quarter may not be indicative of the results likely to be experienced over the course of our fiscal year.
Recent Developments
Impairment Losses
During the year ended
December 31, 2012
, we recorded a loss on impairment of real estate totaling $50.9 million. Of this total,
$26.5 million
is attributable to four Properties which were sold in 2012 and included in discontinued operations,
$23.3 million
is attributable to two existing Properties and
$1.1 million
relates to the sale of
three
outparcels.
Acquisitions
In
December 2012
, we acquired the remaining
40.0%
interests in Imperial Valley Mall L.P., Imperial Valley Peripheral L.P. and Imperial Valley Commons L.P. in El Centro, CA from our joint venture partner. The interests were acquired for total consideration of
$36.5 million
which consists of
$15.5 million
in cash and
$21.0 million
related to our assumption of the joint venture partner's share of the non-recourse loan secured by Imperial Valley Mall.
In
December 2012
, we acquired a
49.0%
joint venture interest in Kirkwood Mall in Bismarck, ND. We paid cash of
$39.8 million
for our
49.0%
share, which was based on a total value of
$121.5 million
including a
$40.4 million
non-recourse loan. We executed an agreement to acquire the remaining
51.0%
interest within 90 days subject to the lender's approval to assume the loan, which bears interest of
5.75%
and matures in
April 2018
.
In
May 2012
, we
acquired Dakota Square Mall in Minot, ND. The purchase price of
$91.5 million
consisted of
$32.5 million
in cash and the assumption of a
$59.0 million
non-recourse loan that bears interest at a fixed rate of
6.23%
and matures in
November 2016
.
In
April 2012
, we exercised our right with our noncontrolling interest partner to convert a mezzanine loan into a member interest in The Outlet Shoppes at Gettysburg, located in Gettysburg, PA. After conversion, we own a
50.0%
interest in the outlet center. Our investment of
$24.8 million
consisted of a
$4.5 million
converted mezzanine loan and the assumption of
$20.3 million
of debt. The
$40.6 million
of debt, of which our share is
50.0%
, bears interest at a fixed rate of
5.87%
and matures in
February 2016
.
In
April 2012
, we acquired a
75.0%
joint venture interest in The Outlet Shoppes at El Paso, an outlet shopping center located in El Paso, TX for
$31.6 million
and a
50.0%
joint venture interest in outparcel land adjacent to The Outlet Shoppes at El Paso for
$3.9 million
for a total of
$35.5 million
. The amount paid for our
75.0%
and
50.0%
interests was based on a total value of
$116.8 million
including a non-recourse loan of
$66.9 million
, which bears interest at a fixed rate of
7.06%
and matures in
December 2017
. The entity that owned The Outlet Shoppes at El Paso used a portion of the cash proceeds to repay a
$9.2 million
mezzanine loan provided by us. After considering the repayment of the mezzanine loan, we paid net consideration of
$28.6 million
in connection with this transaction.
Dispositions and Assets Held for Sale
The results of operations of the Properties described below, as well as any gains or impairment losses related to these Properties, are included in discontinued operations for all periods presented, as applicable.
In the fourth quarter of 2012, we determined that two office buildings met the criteria to be classified as held for sale as of December 31, 2012. These Properties were sold in January 2013. See
Note 20
to the consolidated financial statements
for additional information about the sale.
In December 2012, we sold Willowbrook Plaza, a community center located in Houston, TX, for a gross sales price of
$24.5 million
less commissions and customary closing costs for a net sales price of
$24.2 million
. Proceeds from the sale were used to reduce the outstanding borrowings on our credit facilities. In accordance with our quarterly impairment review process, we recorded a loss on impairment of real estate of
$17.7 million
during the third quarter of 2012 to write down the book value of this Property to its then estimated fair value.
In October 2012, we sold Towne Mall, located in Franklin, OH and Hickory Hollow Mall, located in Antioch, TN. Towne Mall sold for a gross sales price of
$1.0 million
less commissions and customary closings costs for a net sales price of
$0.9 million
. Hickory Hollow Mall sold for a gross sales price of
$1.0 million
less commissions and customary closing costs for a net sales price of
$1.0 million
. Net proceeds from the sale of both malls were used to reduce outstanding borrowings on our credit facilities. In the third quarter of 2012, we recorded a loss on impairment of real estate of
$0.4 million
for Towne Mall and
$8.0 million
for Hickory Hollow Mall to write down the book value of both Properties to the expected net sales price.
In July 2012, we sold Massard Crossing, a community center located in Fort Smith, AR, for a gross sales price of
$7.8 million
less commissions and customary closing costs for a net sales price of
$7.4 million
. Proceeds from the sale were used to reduce outstanding borrowings on our credit facilities. We recorded a gain of
$0.1 million
attributable to the sale in the third quarter of 2012.
In March 2012, we completed the sale of the second phase of Settlers Ridge, a community center located in Robinson Township, PA, for a gross sales price of
$19.1 million
less commissions and customary closing costs for a net sales price of
$19.0 million
. Proceeds from the sale were used to reduce outstanding borrowings on our credit facilities. We recorded a gain of
$0.9 million
attributable to the sale in the first quarter of 2012. We recorded a loss on impairment of real estate of
$4.5 million
in the second quarter of 2011 to write down the book value of this Property to its then estimated fair value.
In January 2012, we sold Oak Hollow Square, a community center located in High Point, NC, for a gross sales price of
$14.2 million
. Net proceeds of
$13.8 million
were used to reduce the outstanding balance on our unsecured term loan. We recorded a loss on impairment of real estate of
$0.3 million
in the first quarter of 2012 related to the true-up of certain estimated amounts to actual amounts. We recorded a loss on impairment of real estate of
$0.7 million
in the fourth quarter of 2011 to write down the book value of this Property to the estimated net sales price.
Credit Facilities
In November 2012, we closed on the modification and extension of our
$525.0 million
and
$520.0 million
secured credit facilities. Under the terms of the agreements, of which Wells Fargo Bank NA serves as the administrative agent for the lender groups, the
two
secured credit facilities were converted to
two
unsecured credit facilities with an increase in capacity on each to
$600.0 million
for a total capacity of
$1.2 billion
. We paid aggregate fees of approximately
$4.3 million
in connection with the extension and modification of the facilities. One of the
$600.0 million
facilities matures in
November 2015
and has a
one
-year extension option for an outside maturity date of
November 2016
. The other
$600.0 million
facility matures in
November 2016
and has a
one
-year extension option for an outside maturity date of
November 2017
. The extension options on both facilities are at our election, subject to continued compliance with the terms of the facilities, and have a one-time extension fee of
0.20%
of the total of each credit facility commitment. The
two
unsecured facilities bear interest at an annual rate equal to one-month, three-month, or six-month LIBOR plus a range of
155
to
210
basis points based on our leverage ratio. We also pay annual unused facility fees, on a quarterly basis, under our unsecured lines of credit at rates of either
0.25%
or
0.35%
based upon any unused commitment of each facility. In the event we obtain an investment grade rating by either Standard & Poor's or Moody's, we may make a one-time irrevocable election to use our credit rating to determine the interest rate on each facility. If we were to make such an election, the interest rate on each facility would bear interest at an annual rate equal to one-month, three-month, or six-month LIBOR plus a spread of
100
to
175
basis points. Once we elect to use our credit rating to determine the interest rate on each facility, we will begin to pay an annual facility fee that ranges from
0.15%
to
0.35%
of the total capacity of each facility rather than the annual fees based on any unused commitment as described above.
In June 2012, we closed on the extension and modification of our
$105.0 million
secured credit facility. The facility's maturity date was extended to
June 2015
and has a
one
-year extension option, which is at our election and subject to continued compliance with the terms of the facility, for an outside maturity date of
June 2016
. The facility bears interest at an annual rate equal to one-month LIBOR plus a margin of
175
to
275
basis points based on our leverage ratio. See
Note 20
to the consolidated financial statements for a subsequent event related to the
$105.0 million
secured credit facility.
Financings
In the fourth quarter of 2012, a subsidiary of CBL/T-C, LLC ("CBL/T-C"), a joint venture in which we own a 50% interest, obtained a
10
-year
$190.0 million
non-recourse loan, secured by West County Center in Des Peres, MO, that bears a
fixed interest rate of
3.4%
and matures in
December 2022
. Net proceeds of
$189.7 million
were used to retire the outstanding borrowings of
$142.2 million
under the previous loan and the excess proceeds were distributed 50/50 to us and our partner. Additionally, we retired a non-recourse loan with a principal balance of
$106.9 million
, secured by Monroeville Mall in Monroeville, PA, with borrowings from our credit facilities. The loan was scheduled to mature in
January 2013
.
During the third quarter of 2012, we retired two loans totaling
$122.0 million
, each of which was secured by a regional mall, with borrowings from our credit facilities. The loans were scheduled to mature in 2012. We recorded a gain on extinguishment of debt of
$0.2 million
related to the early retirement of this debt.
Also in the third quarter of 2012, JG Gulf Coast Town Center LLC ("Gulf Coast"), a joint venture in which we own a 50% interest, closed on a three-year
$7.0 million
loan with a bank, secured by the third phase expansion of Gulf Coast Town Center, a shopping center located in Ft. Myers, FL. Interest on the loan is at
LIBOR plus a margin of 2.5%
. We have guaranteed
100%
of this loan. Proceeds from the loan were distributed to us in accordance with the terms of the joint venture agreement and we used these funds to reduce the balance on our credit facilities.
During the second quarter of 2012, we closed on five 10-year non-recourse commercial mortgage-backed securities ("CMBS") loans totaling
$342.2 million
. The loans bear interest at fixed rates ranging from
4.750%
to
5.099%
with a total weighted average interest rate of
4.946%
. These loans are secured by WestGate Mall in Spartanburg, SC; Southpark Mall in Colonial Heights, VA; Jefferson Mall in Louisville, KY; Fashion Square Mall in Saginaw, MI and Arbor Place in Douglasville, GA. Proceeds were used to pay down our credit facilities and to retire an existing loan with a balance of
$30.8 million
secured by Southpark Mall.
Also during the second quarter of 2012, we closed on a
$22.0 million
10
-year non-recourse loan with an insurance company at a fixed interest rate of
5.00%
secured by CBL Centers I and II in Chattanooga, TN. The new loan was used to pay down our credit facilities, which had been used in April 2012 and February 2012 to retire the balances on the maturing loans on CBL Centers II and I which had principal outstanding balances of
$9.1 million
and
$12.8 million
, respectively. We closed on the extension and modification of a recourse loan secured by Statesboro Crossing in Statesboro, GA to extend the maturity date to February 2013 and reduce the amount available under the loan from
$20.9 million
to equal the outstanding balance of
$13.6 million
. The interest rate remained at
one-month LIBOR plus a spread of 1.00%
.
In the second quarter of 2012, we entered into a
75%
/
25%
joint venture, Atlanta Outlet Shoppes, LLC, with a third party to develop, own and operate The Outlet Shoppes at Atlanta, an outlet center development located in Woodstock, GA, In August 2012, the joint venture closed on a construction loan with a maximum capacity of
$69.8 million
that bears interest at
LIBOR plus a margin of 275 basis points
. The loan matures in
August 2015
and has
two
one-year extensions available, which are at our option. We have guaranteed
100%
of this loan.
During the first quarter of 2012, we closed on a
$73.0 million
10
-year non-recourse CMBS loan secured by Northwoods Mall in Charleston, SC, which bears a fixed interest rate of
5.075%
. Proceeds were used to reduce outstanding balances on our credit facilities.
During the first quarter of 2012, York Town Center, LP ("YTC"), a joint venture in which we own a 50% interest, closed on a
$38.0 million
10-year
non-recourse loan, secured by York Town Center in York, PA, which bears interest at a fixed rate of
4.9%
and matures in
February 2022
. Proceeds from the new loan, plus cash on hand, were used to retire an existing loan of
$39.4 million
that was scheduled to mature in
March 2012
.
Also during the first quarter of 2012, Port Orange I, LLC ("Port Orange"), a joint venture in which we own a 50% interest, closed on the extension and modification of a construction loan secured by The Pavilion at Port Orange in Port Orange, FL, to extend the maturity date to
March 2014
, remove a
1%
LIBOR floor and reduce the capacity from
$98.9 million
to
$65.0 million
. Port Orange paid
$3.3 million
to reduce the outstanding balance on the loan to the new capacity amount. There is a
one
-year extension option remaining on the loan, which is at the joint venture's election, for an outside maturity date of
March 2015
. Interest on the loan is at
LIBOR plus a margin of 3.5%
. We have guaranteed
100%
of the construction loan.
Also during the first quarter of 2012, we retired
14
operating property loans with an aggregate principal balance of
$381.6 million
that were secured by Arbor Place, The Landing at Arbor Place, Fashion Square, Hickory Hollow Mall, The Courtyard at Hickory Hollow, Jefferson Mall, Massard Crossing, Northwoods Mall, Old Hickory Mall, Pemberton Plaza, Randolph Mall, Regency Mall, WestGate Mall and Willowbrook Plaza with borrowings from our credit facilities. See
Note 4
to the consolidated financial statements related to the sale of Massard Crossing, Hickory Hollow Mall and Willowbrook Plaza in 2012.
As of
December 31, 2012
,
$547.3 million
of our pro rata share of consolidated and unconsolidated debt, excluding debt premiums, is scheduled to mature during
2013
. We have extensions available on $68.6 million of debt at our option that we intend to exercise, leaving $478.7 million of debt maturities in 2013 that we intend to retire or refinance, representing 14 operating property loans totaling $250.7 million and a $228.0 million unsecured term loan. Subsequent to
December 31, 2012
,
we retired
two
operating property loans with an outstanding balance of
$77.1 million
as of
December 31, 2012
.
Equity
Common Stock
Our authorized common stock consists of
350,000,000
shares at
$0.01
par value per share. We had
161,309,652
and
148,364,037
shares of common stock issued and outstanding as of
December 31, 2012
and
2011
, respectively.
Preferred Stock
Our authorized preferred stock consists of
15,000,000
shares at
$0.01
par value per share. A description of our cumulative redeemable preferred stock is listed below.
In October 2012, we completed an underwritten public offering of
6,900,000
depositary shares, each representing 1/10
th
of a share of our newly designated
6.625%
Series E Cumulative Redeemable Preferred Stock (the "Series E Preferred Stock") at
$25.00
per depositary share. We received net proceeds from the offering of approximately
$166.6 million
after deducting the underwriting discount and offering expenses. A portion of the net proceeds from this offering were used to redeem all our outstanding
7.75%
Series C Cumulative Redeemable Preferred Stock (the "Series C Shares") with a liquidation preference of
$115.0 million
and
$0.9 million
related to accrued and unpaid dividends for an aggregate redemption amount of
$115.9 million
. The remaining net proceeds of
$50.7 million
were used to reduce outstanding balances on our credit facilities. We will pay cumulative dividends on the Series E Preferred Stock from the date of original issuance in the amount of
$1.65625
per depositary share each year, which is equivalent to
6.625%
of the
$25.00
liquidation preference per depositary share. We may not redeem the Series E Preferred Stock before October 12, 2017, except in limited circumstances to preserve our REIT status or in connection with a change of control. On or after October 12, 2017, we may, at our option, redeem the Series E Preferred Stock in whole at any time or in part from time to time by paying
$25.00
per depositary share, plus any accrued and unpaid dividends up to, but not including, the date of redemption. The Series E Preferred Stock generally has no stated maturity and will not be subject to any sinking fund or mandatory redemption. The Series E Preferred Stock is not convertible into any of our securities, except under certain circumstances in connection with a change of control. Owners of the depositary shares representing Series E Preferred Stock generally have no voting rights except under dividend default.
We had
18,150,000
depositary shares outstanding, each representing 1/10
th
of a share of our
7.375%
Series D Cumulative Redeemable Preferred Stock (the "Series D Preferred Stock") with a par value of
$0.01
per share, as of
December 31, 2012
and
2011
. The Series D Preferred Stock has a liquidation preference of
$250.00
per share (
$25.00
per depositary share). The dividends on the Series D Preferred Stock are cumulative, accrue from the date of issuance and are payable quarterly in arrears at a rate of
$18.4375
per share (
$1.84375
per depositary share) per annum. The Series D Preferred Stock has no stated maturity, is not subject to any sinking fund or mandatory redemption, and is not convertible into any other securities. We may redeem shares, in whole or in part, at any time for a cash redemption price of
$250.00
per share (
$25.00
per depositary share) plus accrued and unpaid dividends.
On November 5, 2012, we redeemed all
460,000
Series C Shares and all outstanding depositary shares, each representing 1/10
th
of a Series C Share for
$115.9 million
. We recorded a charge to preferred dividends of
$3.8 million
upon redemption to write off the unamortized portion of direct issuance costs related to the Series C Shares and underlying depositary shares.
Financial Information About Segments
See
Note 11
to the consolidated financial statements for information about our reportable segments.
Employees
CBL does not have any employees other than its statutory officers. Our Management Company currently has 678 full-time and 248 part-time employees. None of our employees are represented by a union.
Corporate Offices
Our principal executive offices are located at CBL Center, 2030 Hamilton Place Boulevard, Suite 500, Chattanooga, Tennessee, 37421 and our telephone number is (423) 855-0001.
Available Information
There is additional information about us on our web site at
cblproperties.com
. Electronic copies of our Annual Report on Form 10-K, quarterly reports on Form 10-Q and current reports on Form 8-K, as well as any amendments to those reports, are available free of charge by visiting the “investor relations” section of our web site. These reports are posted as soon as reasonably practical after they are electronically filed with, or furnished to, the Securities and Exchange Commission. The information on the web site is not, and should not be considered, a part of this Form 10-K.
ITEM 1A. RISK FACTORS
Set forth below are certain factors that may adversely affect our business, financial condition, results of operations and cash flows. Any one or more of the following factors may cause our actual results for various financial reporting periods to differ materially from those expressed in any forward-looking statements made by us, or on our behalf. See “Cautionary Statement Regarding Forward-Looking Statements” contained herein on
page 1
.
RISKS RELATED TO REAL ESTATE INVESTMENTS
Real property investments are subject to various risks, many of which are beyond our control, that could cause declines in the operating revenues and/or the underlying value of one or more of our Properties.
A number of factors may decrease the income generated by a retail shopping center property, including:
|
|
•
|
national, regional and local economic climates, which may be negatively impacted by loss of jobs, production slowdowns, adverse weather conditions, natural disasters, acts of violence, war or terrorism, declines in residential real estate activity and other factors which tend to reduce consumer spending on retail goods;
|
|
|
•
|
adverse changes in levels of consumer spending, consumer confidence and seasonal spending (especially during the holiday season when many retailers generate a disproportionate amount of their annual profits);
|
|
|
•
|
local real estate conditions, such as an oversupply of, or reduction in demand for, retail space or retail goods, and the availability and creditworthiness of current and prospective tenants;
|
|
|
•
|
increased operating costs, such as increases in repairs and maintenance, real property taxes, utility rates and insurance premiums;
|
|
|
•
|
delays or cost increases associated with the opening of new or renovated properties, due to higher than estimated construction costs, cost overruns, delays in receiving zoning, occupancy or other governmental approvals, lack of availability of materials and labor, weather conditions, and similar factors which may be outside our ability to control;
|
|
|
•
|
perceptions by retailers or shoppers of the safety, convenience and attractiveness of the shopping center;
|
|
|
•
|
the willingness and ability of the shopping center’s owner to provide capable management and maintenance services; and
|
|
|
•
|
the convenience and quality of competing retail properties and other retailing options, such as the internet.
|
In addition, other factors may adversely affect the value of our Properties without affecting their current revenues, including:
|
|
•
|
adverse changes in governmental regulations, such as local zoning and land use laws, environmental regulations or local tax structures that could inhibit our ability to proceed with development, expansion, or renovation activities that otherwise would be beneficial to our Properties;
|
|
|
•
|
potential environmental or other legal liabilities that reduce the amount of funds available to us for investment in our Properties;
|
|
|
•
|
any inability to obtain sufficient financing (including construction financing and permanent debt), or the inability to obtain such financing on commercially favorable terms, to fund repayment of maturing loans, new developments, acquisitions, and property expansions and renovations which otherwise would benefit our Properties; and
|
|
|
•
|
an environment of rising interest rates, which could negatively impact both the value of commercial real estate such as retail shopping centers and the overall retail climate.
|
Illiquidity of real estate investments could significantly affect our ability to respond to adverse changes in the performance of our Properties and harm our financial condition.
Substantially all of our total consolidated assets consist of investments in real properties. Because real estate investments are relatively illiquid, our ability to quickly sell one or more Properties in our portfolio in response to changing economic, financial and investment conditions is limited. The real estate market is affected by many factors, such as general economic conditions, availability of financing, interest rates and other factors, including supply and demand for space, that are beyond our control. We cannot predict whether we will be able to sell any Property for the price or on the terms we set, or whether any price or other terms offered by a prospective purchaser would be acceptable to us. We also cannot predict the length of time needed to find a willing purchaser and to close the sale of a Property. In addition, current economic and capital market conditions might make it more difficult for us to sell Properties or might adversely affect the price we receive for Properties that we do sell, as prospective buyers might experience increased costs of debt financing or other difficulties in obtaining debt financing.
Moreover, there are some limitations under federal income tax laws applicable to REITs that limit our ability to sell assets. In addition, because our Properties are generally mortgaged to secure our debts, we may not be able to obtain a release of a lien on a mortgaged Property without the payment of the associated debt and/or a substantial prepayment penalty, which restricts our ability to dispose of a Property, even though the sale might otherwise be desirable. Furthermore, the number of prospective buyers interested in purchasing shopping centers is limited. Therefore, if we want to sell one or more of our Properties, we may not be able to dispose of it in the desired time period and may receive less consideration than we originally invested in the Property.
Before a Property can be sold, we may be required to make expenditures to correct defects or to make improvements. We cannot assure you that we will have funds available to correct those defects or to make those improvements, and if we cannot do so, we might not be able to sell the Property, or might be required to sell the Property on unfavorable terms. In acquiring a property, we might agree to provisions that materially restrict us from selling that property for a period of time or impose other restrictions, such as limitations on the amount of debt that can be placed or repaid on that property. These factors and any others that would impede our ability to respond to adverse changes in the performance of our Properties could adversely affect our financial condition and results of operations.
We may elect not to proceed with certain development or expansion projects once they have been undertaken, resulting in charges that could have a material adverse effect on our results of operations for the period in which the charge is taken.
We intend to pursue development and expansion activities as opportunities arise. In connection with any development or expansion, we will incur various risks, including the risk that development or expansion opportunities explored by us may be abandoned for various reasons including, but not limited to, credit disruptions that require the Company to conserve its cash until the capital markets stabilize or alternative credit or funding arrangements can be made. Developments or expansions also include the risk that construction costs of a project may exceed original estimates, possibly making the project unprofitable. Other risks include the risk that we may not be able to refinance construction loans which are generally with full recourse to us, the risk that occupancy rates and rents at a completed project will not meet projections and will be insufficient to make the project profitable, and the risk that we will not be able to obtain anchor, mortgage lender and property partner approvals for certain expansion activities.
When we elect not to proceed with a development opportunity, the development costs ordinarily are charged against income for the then-current period. Any such charge could have a material adverse effect on our results of operations for the period in which the charge is taken.
Certain of our Properties are subject to ownership interests held by third parties, whose interests may conflict with ours and thereby constrain us from taking actions concerning these Properties which otherwise would be in the best interests of the Company and our stockholders.
We own partial interests in 26 malls, 10 associated centers, seven community centers and nine office buildings. Governor’s Square and Governor’s Plaza in Clarksville, TN and Kentucky Oaks Mall in Paducah, KY are all owned by unconsolidated joint ventures and are managed by a property manager that is affiliated with the third party managing general partner, which receives a fee for its services. The managing general partner of each of these Properties controls the cash flow distributions, although our approval is required for certain major decisions. The Outlet Shoppes at Oklahoma City in Oklahoma City, OK, The Outlet Shoppes at Gettysburg in Gettysburg, PA, The Outlet Shoppes at El Paso in El Paso, TX and Kirkwood Mall in Bismarck, ND are owned by consolidated joint ventures and managed by a property manager that is affiliated with the third party partner or a third party property manager, which receives a fee for its services. Further, we have contracted with a third-party firm that provides property management services to oversee the operations of our six office buildings located in Chesapeake, VA and Newport News, VA. The firm receives a fee for its services.
Where we serve as managing general partner (or equivalent) of the entities that own our Properties, we may have certain fiduciary responsibilities to the other owners of those entities. In certain cases, the approval or consent of the other owners is required before we may sell, finance, expand or make other significant changes in the operations of such Properties. To the extent
such approvals or consents are required, we may experience difficulty in, or may be prevented from, implementing our plans with respect to expansion, development, financing or other similar transactions with respect to such Properties.
With respect to those Properties for which we do not serve as managing general partner (or equivalent), we do not have day-to-day operational control or control over certain major decisions, including leasing and the timing and amount of distributions, which could result in decisions by the managing entity that do not fully reflect our interests. This includes decisions relating to the requirements that we must satisfy in order to maintain our status as a REIT for tax purposes. However, decisions relating to sales, expansion and disposition of all or substantially all of the assets and financings are subject to approval by the Operating Partnership.
Bankruptcy of joint venture partners could impose delays and costs on us with respect to the jointly owned retail Properties.
In addition to the possible effects on our joint ventures of a bankruptcy filing by us, the bankruptcy of one of the other investors in any of our jointly owned shopping centers could materially and adversely affect the relevant Property or Properties. Under the bankruptcy laws, we would be precluded from taking some actions affecting the estate of the other investor without prior approval of the bankruptcy court, which would, in most cases, entail prior notice to other parties and a hearing in the bankruptcy court. At a minimum, the requirement to obtain court approval may delay the actions we would or might want to take. If the relevant joint venture through which we have invested in a Property has incurred recourse obligations, the discharge in bankruptcy of one of the other investors might result in our ultimate liability for a greater portion of those obligations than we would otherwise bear.
We may incur significant costs related to compliance with environmental laws, which could have a material adverse effect on our results of operations, cash flows and the funds available to us to pay dividends.
Under various federal, state and local laws, ordinances and regulations, a current or previous owner or operator of real estate may be liable for the costs of removal or remediation of petroleum, certain hazardous or toxic substances on, under or in such real estate. Such laws typically impose such liability without regard to whether the owner or operator knew of, or was responsible for, the presence of such substances. The costs of remediation or removal of such substances may be substantial. The presence of such substances, or the failure to promptly remove or remediate such substances, may adversely affect the owner's or operator's ability to lease or sell such real estate or to borrow using such real estate as collateral. Persons who arrange for the disposal or treatment of hazardous or toxic substances may also be liable for the costs of removal or remediation of such substances at the disposal or treatment facility, regardless of whether such facility is owned or operated by such person. Certain laws also impose requirements on conditions and activities that may affect the environment or the impact of the environment on human health. Failure to comply with such requirements could result in the imposition of monetary penalties (in addition to the costs to achieve compliance) and potential liabilities to third parties. Among other things, certain laws require abatement or removal of friable and certain non-friable asbestos-containing materials in the event of demolition or certain renovations or remodeling. Certain laws regarding asbestos-containing materials require building owners and lessees, among other things, to notify and train certain employees working in areas known or presumed to contain asbestos-containing materials. Certain laws also impose liability for release of asbestos-containing materials into the air and third parties may seek recovery from owners or operators of real properties for personal injury or property damage associated with asbestos-containing materials. In connection with the ownership and operation of properties, we may be potentially liable for all or a portion of such costs or claims.
All of our Properties (but not properties for which we hold an option to purchase but do not yet own) have been subject to Phase I environmental assessments or updates of existing Phase I environmental assessments. Such assessments generally consisted of a visual inspection of the Properties, review of federal and state environmental databases and certain information regarding historic uses of the Property and adjacent areas and the preparation and issuance of written reports. Some of the Properties contain, or contained, underground storage tanks used for storing petroleum products or wastes typically associated with automobile service or other operations conducted at the Properties. Certain Properties contain, or contained, dry-cleaning establishments utilizing solvents. Where believed to be warranted, samplings of building materials or subsurface investigations were undertaken. At certain Properties, where warranted by the conditions, we have developed and implemented an operations and maintenance program that establishes operating procedures with respect to asbestos-containing materials. The cost associated with the development and implementation of such programs was not material. We have also obtained environmental insurance coverage at certain of our Properties.
We believe that our Properties are in compliance in all material respects with all federal, state and local ordinances and regulations regarding the handling, discharge and emission of hazardous or toxic substances. As of
December 31, 2012
, we have recorded in our financial statements a liability of $3.1 million related to potential future asbestos abatement activities at our Properties which are not expected to have a material impact on our financial condition or results of operations. We have not been notified by any governmental authority, and are not otherwise aware, of any material noncompliance, liability or claim relating to hazardous or toxic substances in connection with any of our present or former Properties. Therefore, we have not recorded any liability related to hazardous or toxic substances. Nevertheless, it is possible that the environmental assessments available to us
do not reveal all potential environmental liabilities. It is also possible that subsequent investigations will identify material contamination, that adverse environmental conditions have arisen subsequent to the performance of the environmental assessments, or that there are material environmental liabilities of which management is unaware. Moreover, no assurances can be given that (i) future laws, ordinances or regulations will not impose any material environmental liability or (ii) the current environmental condition of the Properties has not been or will not be affected by tenants and occupants of the Properties, by the condition of properties in the vicinity of the Properties or by third parties unrelated to us, the Operating Partnership or the relevant Property's partnership.
Possible terrorist activity or other acts of violence could adversely affect our financial condition and results of operations.
Future terrorist attacks in the United States, and other acts of violence, including terrorism or war, might result in declining consumer confidence and spending, which could harm the demand for goods and services offered by our tenants and the values of our Properties, and might adversely affect an investment in our securities. A decrease in retail demand could make it difficult for us to renew or re-lease our Properties at lease rates equal to or above historical rates and, to the extent our tenants are affected, could adversely affect their ability to continue to meet obligations under their existing leases. Terrorist activities also could directly affect the value of our Properties through damage, destruction or loss. Furthermore, terrorist acts might result in increased volatility in national and international financial markets, which could limit our access to capital or increase our cost of obtaining capital.
RISKS RELATED TO OUR BUSINESS AND THE MARKET FOR OUR STOCK
Declines in economic conditions, including increased volatility in the capital and credit markets, could adversely affect our business, results of operations and financial condition.
An economic recession can result in extreme volatility and disruption of our capital and credit markets. The resulting economic environment may be affected by dramatic declines in the stock and housing markets, increases in foreclosures, unemployment and costs of living, as well as limited access to credit. This economic situation can, and most often will, impact consumer spending levels, which can result in decreased revenues for our tenants and related decreases in the values of our Properties. A sustained economic downward trend could impact our tenants' ability to meet their lease obligations due to poor operating results, lack of liquidity, bankruptcy or other reasons. Our ability to lease space and negotiate rents at advantageous rates could also be affected in this type of economic environment. Additionally, access to capital and credit markets could be disrupted over an extended period, which may make it difficult to obtain the financing we may need for future growth and/or to meet our debt service obligations as they mature. Any of these events could harm our business, results of operations and financial condition.
Any future common stock offerings and common stock dividends or any conversion of outstanding shares of our Series E Preferred Stock may result in dilution of our common stock.
We are not restricted by our organizational documents, contractual arrangements or otherwise from issuing additional common stock, including any securities that are convertible into or exchangeable or exercisable for, or that represent the right to receive, common stock or any substantially similar securities in the future. Future sales or issuances of substantial amounts of our common stock may be at prices below the then-current market price of our common stock and may adversely impact the market price of our common stock. Additionally, the market price of our common stock could decline as a result of sales of a large number of shares of our common stock in the market after a common stock offering or the perception that such sales could occur. Further, outstanding shares of our Series E Preferred Stock are convertible into shares of our common stock under certain limited circumstances upon the occurrence of a Change of Control (as defined in the Certificate of Designations for our Series E Preferred Stock). Depending upon the then-current market price for our common stock, or the related cash consideration involved in the Change of Control, any such conversion could be dilutive to the ownership interest in the Company of holders of our common stock, which could adversely affect the market price of our common stock or impair our ability to raise capital through the sale of additional equity securities. For additional information concerning this feature of our Series E Preferred Stock, see “
The Change of Control conversion and redemption features of the shares of our Series E Preferred Stock and the underlying depositary shares may make it more difficult for a party to take over the Company or discourage a party from taking over the Company
,” below.
The market price of our common stock or other securities may fluctuate significantly.
The market price of our common stock or other securities may fluctuate significantly in response to many factors, including:
|
|
•
|
actual or anticipated variations in our operating results, funds from operations, cash flows or liquidity;
|
|
|
•
|
changes in our earnings estimates or those of analysts;
|
|
|
•
|
changes in our dividend policy;
|
|
|
•
|
impairment charges affecting the carrying value of one or more of our Properties or other assets;
|
|
|
•
|
publication of research reports about us, the retail industry or the real estate industry generally;
|
|
|
•
|
increases in market interest rates that lead purchasers of our securities to seek higher dividend or interest rate yields;
|
|
|
•
|
changes in market valuations of similar companies;
|
|
|
•
|
adverse market reaction to the amount of our outstanding debt at any time, the amount of our maturing debt in the near and medium term and our ability to refinance such debt and the terms thereof or our plans to incur additional debt in the future;
|
|
|
•
|
additions or departures of key management personnel;
|
|
|
•
|
actions by institutional security holders;
|
|
|
•
|
proposed or adopted regulatory or legislative changes or developments;
|
|
|
•
|
speculation in the press or investment community;
|
|
|
•
|
the occurrence of any of the other risk factors included in, or incorporated by reference in, this report; and
|
|
|
•
|
general market and economic conditions.
|
Many of the factors listed above are beyond our control. Those factors may cause the market price of our common stock or other securities to decline significantly, regardless of our financial performance and condition and prospects. It is impossible to provide any assurance that the market price of our common stock or other securities will not fall in the future, and it may be difficult for holders to sell such securities at prices they find attractive, or at all.
The issuance of additional preferred stock may adversely affect the earnings per share available to common shareholders and amounts available to common shareholders for payments of dividends.
On October 5, 2012, we completed an underwritten public equity offering (the “Series E Offering”) of 6,900,000 depositary shares, each representing 1/10th of a share of our 6.625% Series E Preferred Stock, having a liquidation preference of $25.00 per depositary share. We used approximately $115.9 million of the $166.6 million in net proceeds received from this offering to redeem all of our outstanding Series C Shares, including accrued and unpaid dividends, as of November 5, 2012, with the remaining net proceeds being applied to reduce outstanding balances on our lines of credit. We have the option to redeem all or a portion of such depositary shares at any time on or after October 5, 2017, at $25.00 per depositary share, plus all accrued and unpaid dividends to, but not including, the date of redemption. We also have the option to redeem all or a portion of the depositary shares at any time under circumstances intended to preserve our status as a REIT for federal and/or state income tax purposes. In addition, upon the occurrence of a Change of Control (as defined in the Certificate of Designations for our Series E Preferred Stock), we may, at our option, redeem all or a portion of the depositary shares, within 120 days after the first date on which such Change of Control occurred, at $25.00 per depositary share plus all accrued and unpaid dividends to, but not including, the date of redemption. These 6,900,000 depositary shares will accrue dividends totaling approximately $11.4 million annually, decreasing earnings per share available to our common shareholders and the amounts available to our common shareholders for dividend payments.
We are not restricted by our organizational documents, contractual arrangements or otherwise from issuing additional preferred shares, including any securities that are convertible into or exchangeable or exercisable for, or that represent the right to receive, preferred stock or any substantially similar securities in the future.
Competition could adversely affect the revenues generated by our Properties, resulting in a reduction in funds available for distribution to our stockholders.
There are numerous shopping facilities that compete with our Properties in attracting retailers to lease space. In addition, retailers at our Properties face competition for customers from:
|
|
•
|
discount shopping centers;
|
|
|
•
|
television shopping networks; and
|
|
|
•
|
shopping via the internet.
|
Each of these competitive factors could adversely affect the amount of rents and tenant reimbursements that we are able to collect from our tenants, thereby reducing our revenues and the funds available for distribution to our stockholders.
We compete with many commercial developers, real estate companies and major retailers for prime development locations and for tenants. New regional malls or other retail shopping centers with more convenient locations or better rents may attract tenants or cause them to seek more favorable lease terms at, or prior to, renewal.
Increased operating expenses and decreased occupancy rates may not allow us to recover the majority of our common area maintenance (CAM) and other operating expenses from our tenants, which could adversely affect our financial position, results of operations and funds available for future distributions.
Energy costs, repairs, maintenance and capital improvements to common areas of our Properties, janitorial services, administrative, property and liability insurance costs and security costs are typically allocable to our Properties' tenants. Our lease agreements typically provide that the tenant is liable for a portion of the CAM and other operating expenses. While historically our lease agreements provided for variable CAM provisions, the majority of our current leases require an equal periodic tenant reimbursement amount for our cost recoveries which serves to fix our tenants' CAM contributions to us. In these cases, a tenant will pay a single specified rent amount, or a set expense reimbursement amount, subject to annual increases, regardless of the actual amount of operating expenses. The tenant's payment remains the same regardless of whether operating expenses increase or decrease, causing us to be responsible for any excess amounts or to benefit from any declines. As a result, the CAM and tenant reimbursements that we receive may or may not allow us to recover a substantial portion of these operating costs.
Additionally, in the event that our Properties are not fully occupied, we would be required to pay the portion of any operating, redevelopment or renovation expenses allocable to the vacant space(s) that would otherwise typically be paid by the residing tenant(s). Our cost recovery ratio was 99.7% for
2012
.
The loss of one or more significant tenants, due to bankruptcies or as a result of consolidations in the retail industry, could adversely affect both the operating revenues and value of our Properties.
Regional malls are typically anchored by well-known department stores and other significant tenants who generate shopping traffic at the mall. A decision by an anchor tenant or other significant tenant to cease operations at one or more Properties could have a material adverse effect on those Properties and, by extension, on our financial condition and results of operations. The closing of an anchor or other significant tenant may allow other anchors and/or tenants at an affected Property to terminate their leases, to seek rent relief and/or cease operating their stores or otherwise adversely affect occupancy at the Property. In addition, key tenants at one or more Properties might terminate their leases as a result of mergers, acquisitions, consolidations, dispositions or bankruptcies in the retail industry. The bankruptcy and/or closure of one or more significant tenants, if we are not able to successfully re-tenant the affected space, could have a material adverse effect on both the operating revenues and underlying value of the Properties involved, reducing the likelihood that we would be able to sell the Properties if we decided to do so, or we may be required to incur redevelopment costs in order to successfully obtain new anchors or other significant tenants when such vacancies exist.
Our Properties may be subject to impairment charges which can adversely affect our financial results.
We periodically evaluate long-lived assets to determine if there has been any impairment in their carrying values and record impairment losses if the undiscounted cash flows estimated to be generated by those assets are less than their carrying amounts or if there are other indicators of impairment. If it is determined that an impairment has occurred, the amount of the impairment charge is equal to the excess of the asset's carrying value over its estimated fair value, which could have a material adverse effect on our financial results in the accounting period in which the adjustment is made. Our estimates of undiscounted cash flows expected to be generated by each Property are based on a number of assumptions such as leasing expectations, operating budgets, estimated useful lives, future maintenance expenditures, intent to hold for use and capitalization rates. These assumptions are subject to economic and market uncertainties including, but not limited to, demand for space, competition for tenants, changes in market rental rates and costs to operate each Property. As these factors are difficult to predict and are subject to future events that may alter our assumptions, the future cash flows estimated in our impairment analyses may not be achieved. For the year ended
December 31, 2012
, we recorded a loss on impairment of real estate totaling $50.9 million. As described in
Note 3
to the consolidated financial statements, we recognized a total of
$26.5 million
in impairment of real estate, which is included in discontinued operations in our consolidated statements of operations, related to four Properties that were sold in 2012. Additionally for the year ended
December 31, 2012
, as described in
Note 15
to the consolidated financial statements, we recorded a loss on impairment of real estate of
$23.3 million
for two of our Properties and
$1.1 million
related to the sale of
three
outparcels.
Inflation or deflation may adversely affect our financial condition and results of operations.
Increased inflation could have a pronounced negative impact on our mortgage and debt interest and general and administrative expenses, as these costs could increase at a rate higher than our rents. Also, inflation may adversely affect tenant
leases with stated rent increases, which could be lower than the increase in inflation at any given time. Inflation could also have an adverse effect on consumer spending which could impact our tenants' sales and, in turn, our percentage rents, where applicable.
Deflation can result in a decline in general price levels, often caused by a decrease in the supply of money or credit. The predominant effects of deflation are high unemployment, credit contraction and weakened consumer demand. Restricted lending practices could impact our ability to obtain financings or refinancings for our Properties and our tenants' ability to obtain credit. Decreases in consumer demand can have a direct impact on our tenants and the rents we receive.
Certain agreements with prior owners of Properties that we have acquired may inhibit our ability to enter into future sale or refinancing transactions affecting such Properties, which otherwise would be in the best interests of the Company and our stockholders.
Certain Properties that we originally acquired from third parties had unrealized gain attributable to the difference between the fair market value of such Properties and the third parties' adjusted tax basis in the Properties immediately prior to their contribution of such Properties to the Operating Partnership pursuant to our acquisition. For this reason, a taxable sale by us of any of such Properties, or a significant reduction in the debt encumbering such Properties, could result in adverse tax consequences to the third parties who contributed these Properties in exchange for interests in the Operating Partnership. Under the terms of these transactions, we have generally agreed that we either will not sell or refinance such an acquired Property for a number of years in any transaction that would trigger adverse tax consequences for the parties from whom we acquired such Property, or else we will reimburse such parties for all or a portion of the additional taxes they are required to pay as a result of the transaction. Accordingly, these agreements may cause us not to engage in future sale or refinancing transactions affecting such Properties which otherwise would be in the best interests of the Company and our stockholders, or may increase the costs to us of engaging in such transactions.
Uninsured losses could adversely affect our financial condition, and in the future our insurance may not include coverage for acts of terrorism.
We carry a comprehensive blanket policy for general liability, property casualty (including fire, earthquake and flood) and rental loss covering all of the Properties, with specifications and insured limits customarily carried for similar properties. However, even insured losses could result in a serious disruption to our business and delay our receipt of revenue. Furthermore, there are some types of losses, including lease and other contract claims, as well as some types of environmental losses, that generally are not insured or are not economically insurable. If an uninsured loss or a loss in excess of insured limits occurs, we could lose all or a portion of the capital we have invested in a Property, as well as the anticipated future revenues from the Property. If this happens, we, or the applicable Property's partnership, may still remain obligated for any mortgage debt or other financial obligations related to the Property.
The general liability and property casualty insurance policies on our Properties currently include coverage for losses resulting from acts of terrorism, whether foreign or domestic. While we believe that the Properties are adequately insured in accordance with industry standards, the cost of general liability and property casualty insurance policies that include coverage for acts of terrorism has risen significantly subsequent to September 11, 2001. The cost of coverage for acts of terrorism is currently mitigated by the Terrorism Risk Insurance Act (“TRIA”). If TRIA is not extended beyond its current expiration date of December 31, 2014, we may incur higher insurance costs and greater difficulty in obtaining insurance that covers terrorist-related damages. Our tenants may also experience similar difficulties.
RISKS RELATED TO DEBT AND FINANCIAL MARKETS
A deterioration of the capital and credit markets could adversely affect our ability to access funds and the capital needed to refinance debt or obtain new debt.
We are significantly dependent upon external financing to fund the growth of our business and ensure that we meet our debt servicing requirements. Our access to financing depends on the willingness of lending institutions to grant credit to us and conditions in the capital markets in general. An economic recession may cause extreme volatility and disruption in the capital and credit markets. We rely upon our largest credit facilities as sources of funding for numerous transactions. Our access to these funds is dependent upon the ability of each of the participants to the credit facilities to meet their funding commitments. When markets are volatile, access to capital and credit markets could be disrupted over an extended period of time and many financial institutions may not have the available capital to meet their previous commitments. The failure of one or more significant participants to our credit facilities to meet their funding commitments could have an adverse effect on our financial condition and results of operations. This may make it difficult to obtain the financing we may need for future growth and/or to meet our debt service obligations as they mature. Although we have successfully obtained debt for refinancings of our maturing debt, acquisitions and the construction of new developments in the past, we cannot make any assurances as to whether we will be able to obtain debt in the future, or that the financing options available to us will be on favorable or acceptable terms.
Our indebtedness is substantial and could impair our ability to obtain additional financing.
At
December 31, 2012
, our total share of consolidated and unconsolidated debt outstanding was approximately
$5,445.2 million
, which represented approximately
53.8%
of our total market capitalization at that time. Our total share of consolidated and unconsolidated debt maturing in
2013
,
2014
and
2015
, giving effect to all maturity extensions that are available at our election, was approximately
$478.7 million
,
$258.1 million
, and
$801.0 million
, respectively. Our leverage could have important consequences. For example, it could:
|
|
•
|
result in the acceleration of a significant amount of debt for non-compliance with the terms of such debt or, if such debt contains cross-default or cross-acceleration provisions, other debt;
|
|
|
•
|
result in the loss of assets due to foreclosure or sale on unfavorable terms, which could create taxable income without accompanying cash proceeds;
|
|
|
•
|
materially impair our ability to borrow unused amounts under existing financing arrangements or to obtain additional financing or refinancing on favorable terms or at all;
|
|
|
•
|
require us to dedicate a substantial portion of our cash flow to paying principal and interest on our indebtedness, reducing the cash flow available to fund our business, to pay dividends, including those necessary to maintain our REIT qualification, or to use for other purposes;
|
|
|
•
|
increase our vulnerability to an economic downturn;
|
|
|
•
|
limit our ability to withstand competitive pressures; or
|
|
|
•
|
reduce our flexibility to respond to changing business and economic conditions.
|
If any of the foregoing occurs, our business, financial condition, liquidity, results of operations and prospects could be materially and adversely affected, and the trading price of our common stock or other securities could decline significantly.
Rising interest rates could both increase our borrowing costs, thereby adversely affecting our cash flows and the amounts available for distributions to our stockholders, and decrease our stock price, if investors seek higher yields through other investments.
An environment of rising interest rates could lead holders of our securities to seek higher yields through other investments, which could adversely affect the market price of our stock. One of the factors that may influence the price of our stock in public markets is the annual distribution rate we pay as compared with the yields on alternative investments. Numerous other factors, such as governmental regulatory action and tax laws, could have a significant impact on the future market price of our stock. In addition, increases in market interest rates could result in increased borrowing costs for us, which may adversely affect our cash flow and the amounts available for distributions to our stockholders.
As of
December 31, 2012
, our total share of consolidated and unconsolidated variable rate debt was
$1,079.7 million
. Increases in interest rates will increase our cash interest payments on the variable rate debt we have outstanding from time to time. If we do not have sufficient cash flow from operations, we might not be able to make all required payments of principal and interest on our debt, which could result in a default or have a material adverse effect on our financial condition and results of operations, and which might adversely affect our cash flow and our ability to make distributions to shareholders. These significant debt payment obligations might also require us to use a significant portion of our cash flow from operations to make interest and principal payments on our debt rather than for other purposes such as working capital, capital expenditures or distributions on our common equity.
Our hedging arrangements might not be successful in limiting our risk exposure, and we might be required to incur expenses in connection with these arrangements or their termination that could harm our results of operations or financial condition.
From time to time, we use interest rate hedging arrangements to manage our exposure to interest rate volatility, but these arrangements might expose us to additional risks, such as requiring that we fund our contractual payment obligations under such arrangements in relatively large amounts or on short notice. Developing an effective interest rate risk strategy is complex, and no strategy can completely insulate us from risks associated with interest rate fluctuations. We cannot assure you that our hedging activities will have a positive impact on our results of operations or financial condition. We might be subject to additional costs, such as transaction fees or breakage costs, if we terminate these arrangements. In addition, although our interest rate risk management policy establishes minimum credit ratings for counterparties, this does not eliminate the risk that a counterparty might fail to honor its obligations, particularly given current market conditions.
The covenants in our credit facilities might adversely affect us.
Our credit facilities require us to satisfy certain affirmative and negative covenants and to meet numerous financial tests, and also contain certain default and cross-default provisions as described in more detail in
Note 6
to the consolidated financial
statements. Our credit facilities also restrict our ability to enter into any transaction that could result in certain changes in our ownership or structure as described under the heading “Change of Control/Change in Management” in the agreements to the credit facilities. The financial covenants under the unsecured credit facilities require, among other things, that our debt to total asset value ratio, as defined in the agreements to our unsecured credit facilities, be less than 60%, that our ratio of unencumbered asset value to unsecured indebtedness, as defined, be greater than 1.60, that our ratio of unencumbered net operating income ("NOI") to unsecured interest expense, as defined, be greater than 1.75, and that our ratio of EBITDA to fixed charges (debt service), as defined, be greater than 1.50. Compliance with each of these ratios is dependent upon our financial performance. The debt to total asset value ratio is based, in part, on applying a capitalization rate to our earnings before income taxes, depreciation and amortization (“EBITDA”), as defined in the agreements to our credit facilities. Based on this calculation method, decreases in EBITDA would result in an increased debt to total asset value ratio, assuming overall debt levels remain constant. If any future failure to comply with one or more of these covenants resulted in the loss of these credit facilities and we were unable to obtain suitable replacement financing, such loss could have a material, adverse impact on our financial position and results of operations.
RISKS RELATED TO GEOGRAPHIC CONCENTRATIONS
Since our Properties are located principally in the Southeastern and Midwestern United States, our financial position, results of operations and funds available for distribution to shareholders are subject generally to economic conditions in these regions.
Our Properties are located principally in the southeastern and midwestern United States. Our Properties located in the southeastern United States accounted for approximately 48.1% of our total revenues from all Properties for the year ended
December 31, 2012
and currently include 42 malls, 20 associated centers, seven community centers and 18 office buildings. Our Properties located in the midwestern United States accounted for approximately 31.3% of our total revenues from all Properties for the year ended
December 31, 2012
and currently include 27 malls and five associated centers. Our results of operations and funds available for distribution to shareholders therefore will be subject generally to economic conditions in the southeastern and midwestern United States. While we already have Properties located in
eight
states across the southwestern, northeastern and western regions, we will continue to look for opportunities to geographically diversify our portfolio in order to minimize dependency on any particular region; however, the expansion of the portfolio through both acquisitions and developments is contingent on many factors including consumer demand, competition and economic conditions.
Our financial position, results of operations and funds available for distribution to shareholders could be adversely affected by any economic downturn affecting the operating results at our Properties in the St. Louis, MO; Chattanooga, TN; Madison, WI; Lexington, KY; and Nashville, TN metropolitan areas, which are our five largest markets.
Our Properties located in the St. Louis, MO; Chattanooga, TN; Madison, WI; Lexington, KY; and Nashville, TN metropolitan areas accounted for approximately 8.2%, 3.7%, 3.2%, 2.8% and 2.7%, respectively, of our total revenues for the year ended
December 31, 2012
. No other market accounted for more than 2.6% of our total revenues for the year ended
December 31, 2012
. Our financial position and results of operations will therefore be affected by the results experienced at Properties located in these metropolitan areas.
RISKS RELATED TO INTERNATIONAL INVESTMENTS
Ownership interests in investments or joint ventures outside the United States present numerous risks that differ from those of our domestic investments.
International development and ownership activities yield additional risks that differ from those related to our domestic properties and operations. These additional risks include, but are not limited to:
|
|
•
|
impact of adverse changes in exchange rates of foreign currencies;
|
|
|
•
|
difficulties in the repatriation of cash and earnings;
|
|
|
•
|
differences in managerial styles and customs;
|
|
|
•
|
changes in applicable laws and regulations in the United States that affect foreign operations;
|
|
|
•
|
changes in foreign political, legal and economic environments; and
|
|
|
•
|
differences in lending practices.
|
Our international activities are currently limited in their scope. We have an investment in a mall operating and real estate development company in China that is immaterial to our consolidated financial position. However, should our investments in international joint ventures or investments grow, these additional risks could increase in significance and adversely affect our results of operations.
RISKS RELATED TO DIVIDENDS
We may change the dividend policy for our common stock in the future.
Depending upon our liquidity needs, we reserve the right to pay any or all of a dividend in a combination of cash and shares of common stock, to the extent permitted by any applicable revenue procedures of the IRS. In the event that we pay a portion of our dividends in shares of our common stock pursuant to such procedures, taxable U.S. stockholders would be required to pay tax on the entire amount of the dividend, including the portion paid in shares of common stock, in which case such stockholders may have to use cash from other sources to pay such tax. If a U.S. stockholder sells the common stock it receives as a dividend in order to pay its taxes, the sales proceeds may be less than the amount included in income with respect to the dividend, depending on the market price of our common stock at the time of the sale. Furthermore, with respect to non-U.S. stockholders, we may be required to withhold federal tax with respect to our dividends, including dividends that are paid in common stock. In addition, if a significant number of our stockholders sell shares of our common stock in order to pay taxes owed on dividends, such sales would put downward pressure on the market price of our common stock.
The decision to declare and pay dividends on our common stock in the future, as well as the timing, amount and composition of any such future dividends, will be at the sole discretion of our Board of Directors and will depend on our earnings, taxable income, funds from operations, liquidity, financial condition, capital requirements, contractual prohibitions or other limitations under our indebtedness and preferred stock, the annual distribution requirements under the REIT provisions of the Internal Revenue Code, Delaware law and such other factors as our Board of Directors deems relevant. Any dividends payable will be determined by our Board of Directors based upon the circumstances at the time of declaration. Any change in our dividend policy could have a material adverse effect on the market price of our common stock.
Since we conduct substantially all of our operations through our Operating Partnership, our ability to pay dividends on our common and preferred stock depends on the distributions we receive from our Operating Partnership.
Because we conduct substantially all of our operations through our Operating Partnership, our ability to pay dividends on our common and preferred stock will depend almost entirely on payments and distributions we receive on our interests in our Operating Partnership. Additionally, the terms of some of the debt to which our Operating Partnership is a party may limit its ability to make some types of payments and other distributions to us. This in turn may limit our ability to make some types of payments, including payment of dividends to our stockholders, unless we meet certain financial tests. As a result, if our Operating Partnership fails to pay distributions to us, we generally will not be able to pay dividends to our stockholders for one or more dividend periods.
RISKS RELATED TO FEDERAL INCOME TAX LAWS
We conduct a portion of our business through taxable REIT subsidiaries, which are subject to certain tax risks.
We have established several taxable REIT subsidiaries including our Management Company. Despite our qualification as a REIT, our taxable REIT subsidiaries must pay income tax on their taxable income. In addition, we must comply with various tests to continue to qualify as a REIT for federal income tax purposes, and our income from and investments in our taxable REIT subsidiaries generally do not constitute permissible income and investments for these tests. While we will attempt to ensure that our dealings with our taxable REIT subsidiaries will not adversely affect our REIT qualification, we cannot provide assurance that we will successfully achieve that result. Furthermore, we may be subject to a 100% penalty tax, or our taxable REIT subsidiaries may be denied deductions, to the extent our dealings with our taxable REIT subsidiaries are not deemed to be arm's length in nature.
If we fail to qualify as a REIT in any taxable year, our funds available for distribution to stockholders will be reduced.
We intend to continue to operate so as to qualify as a REIT under the Internal Revenue Code. Although we believe that we are organized and operate in such a manner, no assurance can be given that we currently qualify and in the future will continue to qualify as a REIT. Such qualification involves the application of highly technical and complex Internal Revenue Code provisions for which there are only limited judicial or administrative interpretations. The determination of various factual matters and circumstances not entirely within our control may affect our ability to qualify. In addition, no assurance can be given that legislation, new regulations, administrative interpretations or court decisions will not significantly change the tax laws with respect to qualification or its corresponding federal income tax consequences. Any such change could have a retroactive effect.
If in any taxable year we were to fail to qualify as a REIT, we would not be allowed a deduction for distributions to stockholders in computing our taxable income and we would be subject to federal income tax on our taxable income at regular corporate rates. Unless entitled to relief under certain statutory provisions, we also would be disqualified from treatment as a REIT for the four taxable years following the year during which qualification was lost. As a result, the funds available for distribution to our stockholders would be reduced for each of the years involved. This would likely have a significant adverse effect on the value of our securities and our ability to raise additional capital. In addition, we would no longer be required to make
distributions to our stockholders. We currently intend to operate in a manner designed to qualify as a REIT. However, it is possible that future economic, market, legal, tax or other considerations may cause our Board of Directors, with the consent of a majority of our stockholders, to revoke the REIT election.
Any issuance or transfer of our capital stock to any person in excess of the applicable limits on ownership necessary to maintain our status as a REIT would be deemed void ab initio, and those shares would automatically be transferred to a non-affiliated charitable trust.
To maintain our status as a REIT under the Internal Revenue Code, not more than 50% in value of our outstanding capital stock may be owned, directly or indirectly, by five or fewer individuals (as defined in the Internal Revenue Code to include certain entities) at any time during the last half of a taxable year. Our certificate of incorporation generally prohibits ownership of more than 6% of the outstanding shares of our capital stock by any single stockholder determined by vote, value or number of shares (other than Charles Lebovitz, Executive Chairman of our Board of Directors and our former Chief Executive Officer, David Jacobs, Richard Jacobs and their affiliates under the Internal Revenue Code's attribution rules). The affirmative vote of 66 2/3% of our outstanding voting stock is required to amend this provision.
Our Board of Directors may, subject to certain conditions, waive the applicable ownership limit upon receipt of a ruling from the IRS or an opinion of counsel to the effect that such ownership will not jeopardize our status as a REIT. Absent any such waiver, however, any issuance or transfer of our capital stock to any person in excess of the applicable ownership limit or any issuance or transfer of shares of such stock which would cause us to be beneficially owned by fewer than 100 persons, will be null and void and the intended transferee will acquire no rights to the stock. Instead, such issuance or transfer with respect to that number of shares that would be owned by the transferee in excess of the ownership limit provision would be deemed void ab initio and those shares would automatically be transferred to a trust for the exclusive benefit of a charitable beneficiary to be designated by us, with a trustee designated by us, but who would not be affiliated with us or with the prohibited owner. Any acquisition of our capital stock and continued holding or ownership of our capital stock constitutes, under our certificate of incorporation, a continuous representation of compliance with the applicable ownership limit.
In order to maintain our status as a REIT and avoid the imposition of certain additional taxes under the Internal Revenue Code, we must satisfy minimum requirements for distributions to shareholders, which may limit the amount of cash we might otherwise have been able to retain for use in growing our business.
To maintain our status as a REIT under the Internal Revenue Code, we generally will be required each year to distribute to our stockholders at least 90% of our taxable income after certain adjustments. However, to the extent that we do not distribute all of our net capital gains or distribute at least 90% but less than 100% of our REIT taxable income, as adjusted, we will be subject to tax on the undistributed amount at regular corporate tax rates, as the case may be. In addition, we will be subject to a 4% nondeductible excise tax on the amount, if any, by which certain distributions paid by us during each calendar year are less than the sum of 85% of our ordinary income for such calendar year, 95% of our capital gain net income for the calendar year and any amount of such income that was not distributed in prior years. In the case of property acquisitions, including our initial formation, where individual Properties are contributed to our Operating Partnership for Operating Partnership units, we have assumed the tax basis and depreciation schedules of the entities contributing Properties. The relatively low tax basis of such contributed Properties may have the effect of increasing the cash amounts we are required to distribute as dividends, thereby potentially limiting the amount of cash we might otherwise have been able to retain for use in growing our business. This low tax basis may also have the effect of reducing or eliminating the portion of distributions made by us that are treated as a non-taxable return of capital.
Complying with REIT requirements might cause us to forego otherwise attractive opportunities.
In order to qualify as a REIT for U.S. federal income tax purposes, we must satisfy tests concerning, among other things, our sources of income, the nature of our assets, the amounts we distribute to our shareholders and the ownership of our stock. We may also be required to make distributions to our shareholders at disadvantageous times or when we do not have funds readily available for distribution. Thus, compliance with REIT requirements may cause us to forego opportunities we would otherwise pursue. In addition, the REIT provisions of the Internal Revenue Code impose a 100% tax on income from “prohibited transactions.” “Prohibited transactions” generally include sales of assets that constitute inventory or other property held for sale in the ordinary course of business, other than foreclosure property. This 100% tax could impact our desire to sell assets and other investments at otherwise opportune times if we believe such sales could be considered “prohibited transactions.”
Our holding company structure makes us dependent on distributions from the Operating Partnership.
Because we conduct our operations through the Operating Partnership, our ability to service our debt obligations and pay dividends to our shareholders is strictly dependent upon the earnings and cash flows of the Operating Partnership and the ability of the Operating Partnership to make distributions to us. Under the Delaware Revised Uniform Limited Partnership Act, the Operating Partnership is prohibited from making any distribution to us to the extent that at the time of the distribution, after
giving effect to the distribution, all liabilities of the Operating Partnership (other than some non-recourse liabilities and some liabilities to the partners) exceed the fair value of the assets of the Operating Partnership. Additionally, the terms of some of the debt to which our Operating Partnership is a party may limit its ability to make some types of payments and other distributions to us. This in turn may limit our ability to make some types of payments, including payment of dividends on our outstanding capital stock, unless we meet certain financial tests or such payments or dividends are required to maintain our qualification as a REIT or to avoid the imposition of any federal income or excise tax on undistributed income. Any inability to make cash distributions from the Operating Partnership could jeopardize our ability to pay dividends on our outstanding shares of capital stock and to maintain qualification as a REIT.
RISKS RELATED TO OUR ORGANIZATIONAL STRUCTURE
The ownership limit described above, as well as certain provisions in our amended and restated certificate of incorporation and bylaws, and certain provisions of Delaware law, may hinder any attempt to acquire us.
There are certain provisions of Delaware law, our amended and restated certificate of incorporation, our bylaws, and other agreements to which we are a party that may have the effect of delaying, deferring or preventing a third party from making an acquisition proposal for us. These provisions may also inhibit a change in control that some, or a majority, of our stockholders might believe to be in their best interest or that could give our stockholders the opportunity to realize a premium over the then-prevailing market prices for their shares. These provisions and agreements are summarized as follows:
|
|
•
|
The Ownership Limit
– As described above, to maintain our status as a REIT under the Internal Revenue Code, not more than 50% in value of our outstanding capital stock may be owned, directly or indirectly, by five or fewer individuals (as defined in the Internal Revenue Code to include certain entities) during the last half of a taxable year. Our certificate of incorporation generally prohibits ownership of more than 6% of the outstanding shares of our capital stock by any single stockholder determined by value (other than Charles Lebovitz, David Jacobs, Richard Jacobs and their affiliates under the Internal Revenue Code's attribution rules). In addition to preserving our status as a REIT, the ownership limit may have the effect of precluding an acquisition of control of us without the approval of our Board of Directors.
|
|
|
•
|
Classified Board of Directors; Removal for Cause
– Our certificate of incorporation historically provided for a Board of Directors divided into three classes, with one class elected each year to serve for a three-year term. As a result, at least two annual meetings of stockholders may have been required for the stockholders to change a majority of our Board of Directors. While our stockholders approved an amendment to our certificate of incorporation at our 2011 annual meeting to declassify the Board of Directors, this declassification will be phased in over three years in a manner that does not alter the term of any current director. Accordingly, this transition will not be completed, with all directors standing for election on an annual basis, until our 2014 annual meeting of stockholders. In addition, our stockholders can only remove directors for cause and only by a vote of 75% of the outstanding voting stock. Collectively, these provisions make it more difficult to change the composition of our Board of Directors and may have the effect of encouraging persons considering unsolicited tender offers or other unilateral takeover proposals to negotiate with our Board of Directors rather than pursue non-negotiated takeover attempts.
|
|
|
•
|
Advance Notice Requirements for Stockholder Proposals
– Our bylaws establish advance notice procedures with regard to stockholder proposals relating to the nomination of candidates for election as directors or new business to be brought before meetings of our stockholders. These procedures generally require advance written notice of any such proposals, containing prescribed information, to be given to our Secretary at our principal executive offices not less than 60 days or no more than 90 days prior to the meeting.
|
|
|
•
|
Vote Required to Amend Bylaws
– A vote of 66
2
/
3
% of our outstanding voting stock (in addition to any separate approval that may be required by the holders of any particular class of stock) is necessary for stockholders to amend our bylaws.
|
|
|
•
|
Delaware Anti-Takeover Statute
– We are a Delaware corporation and are subject to Section 203 of the Delaware General Corporation Law. In general, Section 203 prevents an “interested stockholder” (defined generally as a person owning 15% or more of a company's outstanding voting stock) from engaging in a “business combination” (as defined in Section 203) with us for three years following the date that person becomes an interested stockholder unless:
|
|
|
(a)
|
before that person became an interested holder, our Board of Directors approved the transaction in which the interested holder became an interested stockholder or approved the business combination;
|
|
|
(b)
|
upon completion of the transaction that resulted in the interested stockholder becoming an interested stockholder, the interested stockholder owns 85% of our voting stock outstanding at the time the transaction commenced (excluding stock held by directors who are also officers and by employee stock plans that do not provide employees with the right to determine confidentially whether shares held subject to the plan will be tendered in a tender or exchange offer); or
|
|
|
(c)
|
following the transaction in which that person became an interested stockholder, the business combination is approved
|
by our Board of Directors and authorized at a meeting of stockholders by the affirmative vote of the holders of at least two-thirds of our outstanding voting stock not owned by the interested stockholder.
Under Section 203, these restrictions also do not apply to certain business combinations proposed by an interested stockholder following the announcement or notification of certain extraordinary transactions involving us and a person who was not an interested stockholder during the previous three years or who became an interested stockholder with the approval of a majority of our directors, if that extraordinary transaction is approved or not opposed by a majority of the directors who were directors before any person became an interested stockholder in the previous three years or who were recommended for election or elected to succeed such directors by a majority of directors then in office.
Certain ownership interests held by members of our senior management may tend to create conflicts of interest between such individuals and the interests of the Company and our Operating Partnership.
|
|
•
|
Tax Consequences of the Sale or Refinancing of Certain Properties
– Since certain of our Properties had unrealized gain attributable to the difference between the fair market value and adjusted tax basis in such Properties immediately prior to their contribution to the Operating Partnership, a taxable sale of any such Properties, or a significant reduction in the debt encumbering such Properties, could cause adverse tax consequences to the members of our senior management who owned interests in our predecessor entities. As a result, members of our senior management might not favor a sale of a Property or a significant reduction in debt even though such a sale or reduction could be beneficial to us and the Operating Partnership. Our bylaws provide that any decision relating to the potential sale of any Property that would result in a disproportionately higher taxable income for members of our senior management than for us and our stockholders, or that would result in a significant reduction in such Property's debt, must be made by a majority of the independent directors of the Board of Directors. The Operating Partnership is required, in the case of such a sale, to distribute to its partners, at a minimum, all of the net cash proceeds from such sale up to an amount reasonably believed necessary to enable members of our senior management to pay any income tax liability arising from such sale.
|
|
|
•
|
Interests in Other Entities; Policies of the Board of Directors
– Certain entities owned in whole or in part by members of our senior management, including the construction company that built or renovated most of our Properties, may continue to perform services for, or transact business with, us and the Operating Partnership. Furthermore, certain Property tenants are affiliated with members of our senior management. Our bylaws provide that any contract or transaction between us or the Operating Partnership and one or more of our directors or officers, or between us or the Operating Partnership and any other entity in which one or more of our directors or officers are directors or officers or have a financial interest, must be approved by our disinterested directors or stockholders after the material facts of the relationship or interest of the contract or transaction are disclosed or are known to them. Our code of business conduct and ethics also contains provisions governing the approval of certain transactions involving the Company and employees (or immediate family members of employees, as defined therein) that are not subject to the provision of the bylaws described above. Such transactions are also subject to the Company's related party transactions policy in the manner and to the extent detailed in the proxy statement filed with the SEC for the Company's 2012 annual meeting. Nevertheless, these affiliations could create conflicts between the interests of these members of senior management and the interests of the Company, our shareholders and the Operating Partnership in relation to any transactions between us and any of these entities.
|
The Change of Control conversion and redemption features of the shares of our Series E Preferred Stock and the underlying depositary shares may make it more difficult for a party to take over the Company or discourage a party from taking over the Company.
Upon the occurrence of a Change of Control (as defined in the Certificate of Designations for our Series E Preferred Stock) which results in shares of our common stock and the common securities of the acquiring or surviving entity (or American depositary shares (or “ADSs”) representing such securities) not being listed on the NYSE, the NYSE MKT or NASDAQ or listed on an exchange that is a successor to the NYSE, the NYSE MKT or NASDAQ, holders of the depositary shares representing interests in our Series E Preferred Stock will have the right under certain circumstances to convert some or all of their depositary shares into shares of our common stock (or equivalent value of alternative consideration, if holders of our common stock receive certain alternative forms of consideration in the transaction giving rise to the Change of Control). Upon such a conversion, the holders of depositary shares generally will receive a number of shares of our common stock for each depositary share converted equal to the quotient obtained by dividing (i) the sum of the $25.00 liquidation preference per depositary share plus the amount of any accrued and unpaid dividends to, but not including, the Change of Control Conversion Date (unless the Change of Control Conversion Date is after a record date for a dividend payment on the Series E Preferred Stock underlying the depositary shares and on or prior to the corresponding dividend payment date on the Series E Preferred Stock, in which case no additional amount for such accrued and unpaid dividends will be included in this sum) by (ii) the Common Share Price (as defined in the Certificate of Designations for our Series E Preferred Stock), subject to a maximum number of shares of common stock equal to the Share
Cap (as defined in the Certificate of Designations for our Series E Preferred Stock). If the Common Share Price is less than $10.805 (which is 50% of the per share closing sale price of our common stock on September 27, 2012), subject to adjustment, the holders will receive a maximum of 2.3137 shares of our common stock per depositary share, which may result in a holder receiving value that is less than the liquidation preference of the depositary shares. In addition, there is an aggregate cap of 15,964,530 shares of common stock (or equivalent alternative consideration) issuable upon exercise of the Change of Control conversion right. These features of the Series E Preferred Stock may have the effect of inhibiting a third party from making an acquisition proposal for the Company or of delaying, deferring or preventing a Change of Control of the Company under circumstances that otherwise could provide the holders of our common stock and Series E Preferred Stock with the opportunity to realize a premium over the then-current market price or that stockholders may otherwise believe is in their best interests.
ITEM 1B. UNRESOLVED STAFF COMMENTS
None.
ITEM 2. PROPERTIES
Refer to Management’s Discussion and Analysis of Financial Condition and Results of Operations included in
Item 7
for additional information pertaining to the Properties’ performance.
Malls
We owned a controlling interest in
77
Malls and non-controlling interests in
nine
Malls as of
December 31, 2012
. The Malls are primarily located in middle markets and generally have strong competitive positions because they are the only, or the dominant, regional mall in their respective trade areas. The Malls are generally anchored by two or more department stores and a wide variety of mall stores. Anchor tenants own or lease their stores and non-anchor stores (20,000 square feet or less) lease their locations. Additional freestanding stores and restaurants that either own or lease their stores are typically located along the perimeter of the Malls' parking areas.
We classify our regional Malls into three categories:
|
|
(1)
|
Stabilized Malls - Malls that have completed their initial lease-up and have been open for more than three complete calendar years.
|
|
|
(2)
|
Non-stabilized Malls - Malls that are in their initial lease-up phase. After three complete calendar years of operation, they are reclassified on January 1 of the fourth calendar year to the stabilized Mall category. The Outlet Shoppes at Oklahoma City, which opened in August 2011, was our only non-stabilized Mall as of
December 31, 2012
.
|
|
|
(3)
|
Non-core Malls - Malls where we have determined that the current format of the Property no longer represents the best use of the Property and we are in the process of evaluating alternative strategies for the Property, which may include major redevelopment or an alternative retail or non-retail format. Columbia Place was our only non-core Mall as of
December 31, 2012
. The steps taken to reposition non-core Malls, such as signing tenants to short-term leases, which are not included in occupancy percentages, or leasing to regional or local tenants, which typically do not report sales, may lead to metrics which do not provide relevant information related to the condition of non-core Properties. Therefore, traditional performance measures, such as occupancy percentages and leasing metrics, exclude non-core Malls.
|
We own the land underlying each Mall in fee simple interest, except for Walnut Square, WestGate Mall, St. Clair Square, Brookfield Square, Bonita Lakes Mall, Meridian Mall, Stroud Mall, Wausau Center, Chapel Hill Mall and Eastgate Mall. We lease all or a portion of the land at each of these Malls subject to long-term ground leases.
The following table sets forth certain information for each of the Malls as of
December 31, 2012
:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mall / Location
|
|
Year of Opening/
Acquisition
|
|
Year of
Most
Recent Expansion
|
|
Our
Ownership
|
|
Total
GLA
(1)
|
|
Total Mall Store GLA
(2)
|
|
Mall Store
Sales per
Square
Foot
(3)
|
|
Percentage
Mall
Store GLA
Leased
(4)
|
|
Anchors & Junior Anchors
|
Non-Stabilized Mall:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The Outlet Shoppes at Oklahoma City
Oklahoma City, OK
|
|
2011
|
|
2012
|
|
75
|
%
|
|
376,422
|
|
|
349,474
|
|
|
$
|
368
|
|
|
100
|
%
|
|
Saks Fifth Ave OFF 5TH
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mall / Location
|
|
Year of Opening/
Acquisition
|
|
Year of
Most
Recent Expansion
|
|
Our
Ownership
|
|
Total
GLA
(1)
|
|
Total Mall Store GLA
(2)
|
|
Mall Store
Sales per
Square
Foot
(3)
|
|
Percentage
Mall
Store GLA
Leased
(4)
|
|
Anchors & Junior Anchors
|
Stabilized Malls:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Acadiana Mall
(5)
Lafayette, LA
|
|
1979/2005
|
|
2004
|
|
62.8
|
%
|
|
992,600
|
|
|
300,337
|
|
|
$
|
437
|
|
|
100
|
%
|
|
Dillard's, JC Penney, Macy's, Sears
|
Alamance Crossing
Burlington, NC
|
|
2007
|
|
2011
|
|
100
|
%
|
|
872,717
|
|
|
202,777
|
|
|
230
|
|
|
74
|
%
|
|
Barnes & Noble, Belk, BJ's Wholesale Club, Carousel Cinemas, Dick's Sporting Goods, Dillard's, Hobby Lobby, JC Penney, Kohl's
|
Arbor Place
(5)
Atlanta (Douglasville), GA
|
|
1999
|
|
N/A
|
|
62.8
|
%
|
|
1,163,340
|
|
|
308,910
|
|
|
334
|
|
|
98
|
%
|
|
Bed Bath & Beyond, Belk, Dillard's, Forever 21, H & M, JC Penney, Macy's, Regal Cinemas, Sears
|
Asheville Mall
Asheville, NC
|
|
1972/1998
|
|
2000
|
|
100
|
%
|
|
973,662
|
|
|
287,707
|
|
|
356
|
|
|
100
|
%
|
|
Barnes & Noble, Belk, Dillard's, Dillard's West, JC Penney, Sears
|
Bonita Lakes Mall
(6)
Meridian, MS
|
|
1997
|
|
N/A
|
|
100
|
%
|
|
631,955
|
|
|
154,670
|
|
|
268
|
|
|
96
|
%
|
|
Belk, Dillard's, JC Penney, Sears, United Artists Theatre, Vacancy
|
Brookfield Square
Brookfield, WI
|
|
1967/2001
|
|
2008
|
|
100
|
%
|
|
1,000,404
|
|
|
282,224
|
|
|
371
|
|
|
99
|
%
|
|
Barnes & Noble, Boston Store, JC Penney, Sears
|
Burnsville Center
Burnsville, MN
|
|
1977/1998
|
|
N/A
|
|
100
|
%
|
|
1,045,125
|
|
|
384,505
|
|
|
342
|
|
|
93
|
%
|
|
Dick's Sporting Goods, Gordmans, JC Penney, Macy's, Sears
|
Cary Towne Center
Cary, NC
|
|
1979/2001
|
|
1993
|
|
100
|
%
|
|
915,188
|
|
|
295,842
|
|
|
275
|
|
|
92
|
%
|
|
Belk, Dillard's, JC Penney, Macy's, Sears
|
Chapel Hill Mall
(5) (7)
Akron, OH
|
|
1966/2004
|
|
1995
|
|
62.8
|
%
|
|
863,384
|
|
|
304,060
|
|
|
259
|
|
|
97
|
%
|
|
Encore, JC Penney, Macy's, Sears
|
CherryVale Mall
Rockford, IL
|
|
1973/2001
|
|
2007
|
|
100
|
%
|
|
846,338
|
|
|
331,753
|
|
|
354
|
|
|
93
|
%
|
|
Barnes & Noble, Bergner's, JC Penney, Macy's, Sears
|
Chesterfield Mall
(5)
Chesterfield, MO
|
|
1976/2007
|
|
2006
|
|
62.8
|
%
|
|
1,286,534
|
|
|
491,416
|
|
|
299
|
|
|
94
|
%
|
|
AMC Theater, Dillard's, H&M, Macy's, Sears, V-Stock
|
Citadel Mall
Charleston, SC
|
|
1981/2001
|
|
2000
|
|
100
|
%
|
|
1,019,157
|
|
|
282,329
|
|
|
233
|
|
|
91
|
%
|
|
Belk, Dillard's, JC Penney, Sears, Target
|
Coastal Grand-Myrtle Beach
Myrtle Beach, SC
|
|
2004
|
|
2007
|
|
50
|
%
|
|
1,038,494
|
|
|
342,519
|
|
|
357
|
|
|
98
|
%
|
|
Bed Bath & Beyond, Belk, Cinemark Theater, Dick's Sporting Goods, Dillard's, JC Penney, Sears
|
College Square
Morristown, TN
|
|
1988
|
|
1999
|
|
100
|
%
|
|
485,559
|
|
|
119,263
|
|
|
272
|
|
|
95
|
%
|
|
Belk, Carmike Cinema, Goody's, JC Penney, Kohl's, Sears
|
CoolSprings Galleria
Nashville, TN
|
|
1991
|
|
1994
|
|
50
|
%
|
|
1,101,475
|
|
|
346,839
|
|
|
459
|
|
|
100
|
%
|
|
Belk, Belk Home, Dillard's, JC Penney, Macy's, Sears
|
Cross Creek Mall
Fayetteville, NC
|
|
1975/2003
|
|
2000
|
|
100
|
%
|
|
1,001,230
|
|
|
251,692
|
|
|
543
|
|
|
100
|
%
|
|
Belk, JC Penney, Macy's, Sears
|
Dakota Square Mall
Minot, ND
|
|
1980/2012
|
|
2008
|
|
100
|
%
|
|
820,499
|
|
|
166,688
|
|
|
502
|
|
|
93
|
%
|
|
Barnes & Noble, Carmike Cinema, Herberger's, JC Penney, Scheels, Sears, Sleep Inn & Suites, Splashdown Dakota Super Slides, Target
|
East Towne Mall
Madison, WI
|
|
1971/2001
|
|
2004
|
|
100
|
%
|
|
789,367
|
|
|
230,643
|
|
|
327
|
|
|
97
|
%
|
|
Barnes & Noble, Boston Store, Dick's Sporting Goods, Gordman's, JC Penney, Sears, Steinhafels
|
EastGate Mall
(8)
Cincinnati, OH
|
|
1980/2003
|
|
1995
|
|
100
|
%
|
|
853,434
|
|
|
272,722
|
|
|
300
|
|
|
91
|
%
|
|
Dillard's, JC Penney, Kohl's, Sears
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mall / Location
|
|
Year of Opening/
Acquisition
|
|
Year of
Most
Recent Expansion
|
|
Our
Ownership
|
|
Total
GLA
(1)
|
|
Total Mall Store GLA
(2)
|
|
Mall Store
Sales per
Square
Foot
(3)
|
|
Percentage
Mall
Store GLA
Leased
(4)
|
|
Anchors & Junior Anchors
|
Eastland Mall
Bloomington, IL
|
|
1967/2005
|
|
N/A
|
|
100
|
%
|
|
760,418
|
|
|
220,763
|
|
|
327
|
|
|
97
|
%
|
|
Bergner's, JC Penney, Kohl's, Macy's, Sears
|
Fashion Square
Saginaw, MI
|
|
1972/2001
|
|
1993
|
|
100
|
%
|
|
748,276
|
|
|
255,380
|
|
|
286
|
|
|
97
|
%
|
|
Carmike Cinema, Encore, JC Penney, Macy's, Sears
|
Fayette Mall
Lexington, KY
|
|
1971/2001
|
|
1993
|
|
100
|
%
|
|
1,184,004
|
|
|
355,953
|
|
|
584
|
|
|
100
|
%
|
|
Dick's Sporting Goods, Dillard's, JC Penney, Macy's, Sears
|
Foothills Mall
Maryville, TN
|
|
1983/1996
|
|
2012
|
|
95
|
%
|
|
463,578
|
|
|
121,423
|
|
|
264
|
|
|
77
|
%
|
|
Belk, Carmike Cinema, Goody's, JC Penney, Sears, T.J. Maxx
|
Friendly Shopping Center and The Shops at Friendly
Greensboro, NC
|
|
1957/ 2006/ 2007
|
|
1996 / 2008
|
|
50
|
%
|
|
1,111,109
|
|
|
491,540
|
|
|
427
|
|
|
95
|
%
|
|
Barnes & Noble, Belk, Harris Teeter, Macy's, REI, Sears, The Grande Cinema
|
Frontier Mall
Cheyenne, WY
|
|
1981
|
|
1997
|
|
100
|
%
|
|
535,571
|
|
|
190,701
|
|
|
321
|
|
|
92
|
%
|
|
Carmike Cinema, Dillard's East, Dillard's West, JC Penney, Sears, Sports Authority
|
Georgia Square
Athens, GA
|
|
1981
|
|
N/A
|
|
100
|
%
|
|
671,012
|
|
|
249,458
|
|
|
250
|
|
|
92
|
%
|
|
Belk, JC Penney, Macy's, Sears
|
Governor's Square
Clarksville, TN
|
|
1986
|
|
1999
|
|
47.5
|
%
|
|
738,009
|
|
|
250,485
|
|
|
379
|
|
|
90
|
%
|
|
Belk, Best Buy, Carmike Cinema, Dick's Sporting Goods, Dillard's, JC Penney, Ross Dress for Less
(9)
, Sears
|
Greenbrier Mall
(5)
Chesapeake, VA
|
|
1981/2004
|
|
2004
|
|
63
|
%
|
|
899,015
|
|
|
278,451
|
|
|
327
|
|
|
93
|
%
|
|
Dillard's, JC Penney, Jillian's, Macy's, Sears
|
Gulf Coast Town Center
Ft. Myers, FL
|
|
2005
|
|
2007
|
|
50
|
%
|
|
1,238,729
|
|
|
315,835
|
|
|
305
|
|
|
87
|
%
|
|
Babies R Us, Bass Pro Outdoor World, Belk, Best Buy, Dick's Sporting Goods, Fitness International, Glowgolf, JC Penney, Jo-Ann Fabrics, Marshall's, Regal Cinema, Ross, Staples, Target
|
Hamilton Place
Chattanooga, TN
|
|
1987
|
|
1998
|
|
90
|
%
|
|
1,169,272
|
|
|
333,992
|
|
|
417
|
|
|
98
|
%
|
|
Barnes & Noble, Belk for Men, Kids & Home, Belk for Women, Dillard's for Men, Kids & Home, Dillard's for Women, Forever 21, JC Penney, Sears
|
Hanes Mall
Winston-Salem, NC
|
|
1975/2001
|
|
1990
|
|
100
|
%
|
|
1,503,143
|
|
|
502,017
|
|
|
347
|
|
|
99
|
%
|
|
Belk, Dillard's, Encore, H&M, JC Penney, Macy's, Sears
|
Harford Mall
Bel Air, MD
|
|
1973/2003
|
|
2007
|
|
100
|
%
|
|
505,345
|
|
|
181,169
|
|
|
373
|
|
|
98
|
%
|
|
Macy's, Old Navy, Sears
|
Hickory Point Mall
Decatur, IL
|
|
1977/2005
|
|
N/A
|
|
100
|
%
|
|
826,430
|
|
|
190,855
|
|
|
261
|
|
|
74
|
%
|
|
Bergner's, Cohn Furniture, Encore, JC Penney, Kohl's, Sears, Von Maur
|
Honey Creek Mall
Terre Haute, IN
|
|
1968/2004
|
|
1981
|
|
100
|
%
|
|
676,482
|
|
|
184,967
|
|
|
370
|
|
|
96
|
%
|
|
Elder-Beerman, Encore, JC Penney, Macy's, Sears
|
Imperial Valley Mall
El Centro, CA
|
|
2005
|
|
N/A
|
|
100
|
%
|
|
825,814
|
|
|
212,697
|
|
|
401
|
|
|
96
|
%
|
|
Cinemark, Dillard's, JC Penney, Kohl's, Macy's, Sears
|
Janesville Mall
Janesville, WI
|
|
1973/1998
|
|
1998
|
|
100
|
%
|
|
614,202
|
|
|
166,372
|
|
|
298
|
|
|
97
|
%
|
|
Boston Store, JC Penney, Sears
|
Jefferson Mall
Louisville, KY
|
|
1978/2001
|
|
1999
|
|
100
|
%
|
|
903,082
|
|
|
250,188
|
|
|
365
|
|
|
92
|
%
|
|
Dillard's, JC Penney, Macy's, Ross, Sears, Toys R Us
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mall / Location
|
|
Year of Opening/
Acquisition
|
|
Year of
Most
Recent Expansion
|
|
Our
Ownership
|
|
Total
GLA
(1)
|
|
Total Mall Store GLA
(2)
|
|
Mall Store
Sales per
Square
Foot
(3)
|
|
Percentage
Mall
Store GLA
Leased
(4)
|
|
Anchors & Junior Anchors
|
Kentucky Oaks Mall
Paducah, KY
|
|
1982/2001
|
|
1995
|
|
50
|
%
|
|
1,017,800
|
|
|
304,838
|
|
|
287
|
|
|
86
|
%
|
|
Best Buy, Dick's Sporting Goods, Dillard's, Elder-Beerman, JC Penney, Sears
|
Kirkwood Mall
Bismarck, ND
|
|
1970/2012
|
|
2002
|
|
49
|
%
|
|
848,128
|
|
|
273,850
|
|
|
409
|
|
|
88
|
%
|
|
Herberger's, Keating Furniture, JC Penney, Scheels, Target
|
The Lakes Mall
Muskegon, MI
|
|
2001
|
|
N/A
|
|
100
|
%
|
|
589,665
|
|
|
187,759
|
|
|
266
|
|
|
96
|
%
|
|
Bed Bath & Beyond, Dick's Sporting Goods, JC Penney, Sears, Younkers
|
Lakeshore Mall
Sebring, FL
|
|
1992
|
|
1999
|
|
100
|
%
|
|
490,087
|
|
|
116,071
|
|
|
230
|
|
|
80
|
%
|
|
Beall's
(10)
, Belk, Carmike, JC Penney, Kmart, Sears
|
Laurel Park Place
Livonia, MI
|
|
1989/2005
|
|
1994
|
|
100
|
%
|
|
489,523
|
|
|
190,713
|
|
|
343
|
|
|
99
|
%
|
|
Parisian, Von Maur
|
Layton Hills Mall
Layton, UT
|
|
1980/2006
|
|
1998
|
|
100
|
%
|
|
636,737
|
|
|
204,032
|
|
|
380
|
|
|
95
|
%
|
|
Dick's Sporting Goods, JC Penney, Macy's, former Mervyn's (one level vacant)
|
Madison Square
Huntsville, AL
|
|
1984
|
|
1985
|
|
100
|
%
|
|
928,642
|
|
|
295,208
|
|
|
247
|
|
|
88
|
%
|
|
Belk, Dillard's, JC Penney, Sears, two vacancies
|
Mall del Norte
Laredo, TX
|
|
1977/2004
|
|
1993
|
|
100
|
%
|
|
1,163,399
|
|
|
401,421
|
|
|
562
|
|
|
98
|
%
|
|
Beall's
(10)
, Cinemark, Dillard's, Forever 21, JC Penney, Joe Brand, Macy's, Macy's Home Store, Sears
|
Meridian Mall
(11)
Lansing, MI
|
|
1969/1998
|
|
2001
|
|
100
|
%
|
|
923,448
|
|
|
363,841
|
|
|
305
|
|
|
93
|
%
|
|
Bed Bath & Beyond, Dick's Sporting Goods, JC Penney, Macy's, Schuler Books, Younkers
|
Mid Rivers Mall
(5)
St. Peters, MO
|
|
1987/2007
|
|
1999
|
|
62.8
|
%
|
|
1,088,298
|
|
|
304,979
|
|
|
308
|
|
|
95
|
%
|
|
Best Buy, Dick's Sporting Goods, Dillard's, JC Penney, Macy's, Sears, V-Stock, Wehrenberg Theaters
|
Midland Mall
Midland, MI
|
|
1991/2001
|
|
N/A
|
|
100
|
%
|
|
468,304
|
|
|
131,354
|
|
|
298
|
|
|
97
|
%
|
|
Barnes & Noble, Dunham's Sports, Elder-Beerman, JC Penney, Sears, Target
|
Monroeville Mall
Pittsburgh, PA
|
|
1969/2004
|
|
2003
|
|
100
|
%
|
|
1,067,924
|
|
|
470,755
|
|
|
273
|
|
|
95
|
%
|
|
Barnes & Noble, Best Buy, JC Penney, Macy's
|
Northgate Mall
Chattanooga, TN
|
|
1972/2011
|
|
N/A
|
|
100
|
%
|
|
681,023
|
|
|
154,905
|
|
|
292
|
|
|
78
|
%
|
|
Belk, Carmike Cinemas, JC Penney, Sears, T.J. Maxx
|
Northpark Mall
Joplin, MO
|
|
1972/2004
|
|
1996
|
|
100
|
%
|
|
954,452
|
|
|
273,601
|
|
|
313
|
|
|
90
|
%
|
|
Hollywood Theater, JC Penney, Jo Ann Fabrics, Joplin High School, Macy's, Macy's Home Store, Sears, Tilt, T.J. Maxx, V-Stock
|
Northwoods Mall
Charleston, SC
|
|
1972/2001
|
|
1995
|
|
100
|
%
|
|
772,299
|
|
|
269,180
|
|
|
338
|
|
|
96
|
%
|
|
Belk, Books A Million, Dillard's, JC Penney, Sears
|
Oak Park Mall
Overland Park, KS
|
|
1974/2005
|
|
1998
|
|
50
|
%
|
|
1,532,455
|
|
|
452,266
|
|
|
440
|
|
|
100
|
%
|
|
Barnes & Noble, Dillard's North, Dillard's South, JC Penney, Macy's, Nordstrom, XXI Forever
|
Old Hickory Mall
Jackson, TN
|
|
1967/2001
|
|
1994
|
|
100
|
%
|
|
539,288
|
|
|
162,193
|
|
|
355
|
|
|
95
|
%
|
|
Belk, JC Penney, Macy's, Sears
|
Panama City Mall
Panama City, FL
|
|
1976/2002
|
|
1984
|
|
100
|
%
|
|
608,377
|
|
|
207,845
|
|
|
235
|
|
|
93
|
%
|
|
Bed Bath & Beyond, Dillard's, JC Penney, Sears
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mall / Location
|
|
Year of Opening/
Acquisition
|
|
Year of
Most
Recent Expansion
|
|
Our
Ownership
|
|
Total
GLA
(1)
|
|
Total Mall Store GLA
(2)
|
|
Mall Store
Sales per
Square
Foot
(3)
|
|
Percentage
Mall
Store GLA
Leased
(4)
|
|
Anchors & Junior Anchors
|
Park Plaza
(5)
Little Rock, AR
|
|
1988/2004
|
|
N/A
|
|
62.8
|
%
|
|
540,687
|
|
|
236,937
|
|
|
408
|
|
|
100
|
%
|
|
Dillard's I, Dillard's II, XXI Forever
|
Parkdale Mall
Beaumont, TX
|
|
1972/2001
|
|
1986
|
|
100
|
%
|
|
1,247,617
|
|
|
331,408
|
|
|
346
|
|
|
92
|
%
|
|
Beall's
(10)
, Books A Million, Dillard's, JC Penney, Kaplan College, Macy's, Marshall's, Sears, XXI Forever
|
Parkway Place
Huntsville, AL
|
|
1957/1998
|
|
2002
|
|
100
|
%
|
|
648,637
|
|
|
272,812
|
|
|
321
|
|
|
97
|
%
|
|
Belk, Dillard's
|
Pearland Town Center
(12)
Pearland, TX
|
|
2008
|
|
N/A
|
|
88
|
%
|
|
646,377
|
|
|
282,993
|
|
|
281
|
|
|
87
|
%
|
|
Barnes & Noble, Dillard's, Macy's, Sports Authority
|
Post Oak Mall
College Station, TX
|
|
1982
|
|
1985
|
|
100
|
%
|
|
774,813
|
|
|
287,288
|
|
|
364
|
|
|
86
|
%
|
|
Beall's
(10)
, Dillard's, Dillard's South, Encore, JC Penney, Macy's, Sears
|
Randolph Mall
Asheboro, NC
|
|
1982/2001
|
|
1989
|
|
100
|
%
|
|
379,302
|
|
|
116,019
|
|
|
262
|
|
|
84
|
%
|
|
Belk, Cinemark, Dillard's, JC Penney, Sears
|
Regency Mall
Racine, WI
|
|
1981/2001
|
|
1999
|
|
100
|
%
|
|
789,589
|
|
|
212,182
|
|
|
237
|
|
|
92
|
%
|
|
Boston Store, Burlington Coat Factory, HH Gregg, JC Penney, Sears
|
Richland Mall
Waco, TX
|
|
1980/2002
|
|
1996
|
|
100
|
%
|
|
685,538
|
|
|
204,313
|
|
|
340
|
|
|
95
|
%
|
|
Beall's
(10)
, Dillard's I, Dillard's II, JC Penney, Sears, XXI Forever
|
River Ridge Mall
Lynchburg, VA
|
|
1980/2003
|
|
2000
|
|
100
|
%
|
|
764,688
|
|
|
223,851
|
|
|
276
|
|
|
94
|
%
|
|
Belk, JC Penney, Macy's, Regal Cinema, Sears
|
RiverGate Mall
Nashville, TN
|
|
1971/1998
|
|
1998
|
|
100
|
%
|
|
1,109,353
|
|
|
263,089
|
|
|
303
|
|
|
99
|
%
|
|
Dillard's, Incredible Dave's, JC Penney, Macy's, Sears
|
South County Center
(5)
St. Louis, MO
|
|
1963/2007
|
|
2001
|
|
62.8
|
%
|
|
1,028,386
|
|
|
312,025
|
|
|
369
|
|
|
95
|
%
|
|
Dillard's, JC Penney, Macy's, Sears
|
Southaven Towne Center
Southaven, MS
|
|
2005
|
|
2012
|
|
100
|
%
|
|
528,971
|
|
|
145,876
|
|
|
353
|
|
|
95
|
%
|
|
Bed Bath & Beyond, Dillard's, Gordman's, HH Gregg, JC Penney
|
Southpark Mall
Colonial Heights, VA
|
|
1989/2003
|
|
2007
|
|
100
|
%
|
|
687,375
|
|
|
215,093
|
|
|
328
|
|
|
100
|
%
|
|
Dick's Sporting Goods
(9)
, JC Penney, Macy's, Regal Cinema, Sears
|
St. Clair Square
(5) (13)
Fairview Heights, IL
|
|
1974/1996
|
|
1993
|
|
62.8
|
%
|
|
1,077,967
|
|
|
300,712
|
|
|
396
|
|
|
97
|
%
|
|
Dillard's, JC Penney, Macy's, Sears
|
Stroud Mall
(14)
Stroudsburg, PA
|
|
1977/1998
|
|
2005
|
|
100
|
%
|
|
398,146
|
|
|
113,663
|
|
|
276
|
|
|
99
|
%
|
|
Bon-Ton, Cinemark, JC Penney, Sears
|
Sunrise Mall
Brownsville, TX
|
|
1979/2003
|
|
2000
|
|
100
|
%
|
|
753,503
|
|
|
238,746
|
|
|
409
|
|
|
93
|
%
|
|
A'gaci, Beall's
(10)
, Cinemark, Dillard’s, JC Penney, Sears
|
The Outlet Shoppes at El Paso
El Paso, TX
|
|
2007/2012
|
|
N/A
|
|
75
|
%
|
|
378,955
|
|
|
378,955
|
|
|
372
|
|
|
100
|
%
|
|
None
|
The Outlet Shoppes at Gettysburg
Gettysburg, PA
|
|
2000/2012
|
|
N/A
|
|
50
|
%
|
|
249,937
|
|
|
249,937
|
|
|
248
|
|
|
99
|
%
|
|
None
|
Triangle Town Center
Raleigh, NC
|
|
2002/2005
|
|
N/A
|
|
50
|
%
|
|
1,261,125
|
|
|
425,656
|
|
|
310
|
|
|
93
|
%
|
|
Barnes & Noble, Belk, Dillard's, Macy's, Sak's Fifth Avenue, Sears
|
Turtle Creek Mall
Hattiesburg, MS
|
|
1994
|
|
1995
|
|
100
|
%
|
|
845,692
|
|
|
192,768
|
|
|
336
|
|
|
97
|
%
|
|
Belk I, former Belk II (vacant), Dillard's, JC Penney, Sears, Stein Mart, United Artist Theater
|
Valley View Mall
Roanoke, VA
|
|
1985/2003
|
|
2007
|
|
100
|
%
|
|
844,202
|
|
|
285,375
|
|
|
343
|
|
|
99
|
%
|
|
Barnes & Noble, Belk, JC Penney, Macy's I, Macy's II, Sears
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mall / Location
|
|
Year of Opening/
Acquisition
|
|
Year of
Most
Recent Expansion
|
|
Our
Ownership
|
|
Total
GLA
(1)
|
|
Total Mall Store GLA
(2)
|
|
Mall Store
Sales per
Square
Foot
(3)
|
|
Percentage
Mall
Store GLA
Leased
(4)
|
|
Anchors & Junior Anchors
|
Volusia Mall
Daytona Beach, FL
|
|
1974/2004
|
|
1982
|
|
100
|
%
|
|
1,071,512
|
|
|
252,969
|
|
|
341
|
|
|
99
|
%
|
|
Dillard's East, Dillard's West, Dillard's South, JC Penney, Macy's, Sears
|
Walnut Square
(15)
Dalton, GA
|
|
1980
|
|
1992
|
|
100
|
%
|
|
495,273
|
|
|
169,838
|
|
|
256
|
|
|
99
|
%
|
|
Belk, Belk Home & Kids, JC Penney, Sears, The Rush
|
Wausau Center
(16)
Wausau, WI
|
|
1983/2001
|
|
1999
|
|
100
|
%
|
|
423,155
|
|
|
149,955
|
|
|
261
|
|
|
95
|
%
|
|
JC Penney, Sears, Younkers
|
West County Center
Des Peres, MO
|
|
1969/2007
|
|
2002
|
|
50
|
%
|
|
1,209,370
|
|
|
419,349
|
|
|
476
|
|
|
99
|
%
|
|
Barnes & Noble, Forever 21, Dick's Sporting Goods, JC Penney, Macy's, Nordstrom
|
West Towne Mall
Madison, WI
|
|
1970/2001
|
|
2004
|
|
100
|
%
|
|
831,199
|
|
|
268,382
|
|
|
544
|
|
|
98
|
%
|
|
Boston Store, Dick's Sporting Goods, JC Penney, Sears, XXI Forever
|
WestGate Mall
(17)
Spartanburg, SC
|
|
1975/1995
|
|
1996
|
|
100
|
%
|
|
953,721
|
|
|
247,538
|
|
|
283
|
|
|
92
|
%
|
|
Bed Bath & Beyond, Belk, Dick's Sporting Goods, Dillard's, JC Penney, Regal Cinema, Sears
|
Westmoreland Mall
(5)
Greensburg, PA
|
|
1977/2002
|
|
1994
|
|
62.8
|
%
|
|
999,803
|
|
|
303,964
|
|
|
330
|
|
|
99
|
%
|
|
BonTon, JC Penney, Macy's, Macy's Home Store, Old Navy, Sears
|
York Galleria
York, PA
|
|
1989/1999
|
|
N/A
|
|
100
|
%
|
|
764,602
|
|
|
227,385
|
|
|
318
|
|
|
98
|
%
|
|
Bon Ton, Boscov's, JC Penney, Sears
|
|
|
Total Stabilized Malls
|
|
|
|
|
70,263,297
|
|
|
22,203,031
|
|
|
$
|
353
|
|
|
94
|
%
|
|
|
|
|
Grand total
|
|
|
|
|
|
70,639,719
|
|
|
22,552,505
|
|
|
$
|
354
|
|
|
95
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-Core Mall:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Columbia Place
Columbia, SC
|
|
1977/2001
|
|
N/A
|
|
100
|
%
|
|
1,027,651
|
|
|
274,783
|
|
|
N/A
(18)
|
|
|
N/A
(18)
|
|
|
Burlington Coat Factory, Macy's, Sears, three vacancies
|
|
|
(1)
|
Includes total square footage of the anchors (whether owned or leased by the anchor) and mall stores. Does not include future expansion areas.
|
|
|
(2)
|
Excludes tenants over 20,000 square feet, anchors and junior anchors.
|
|
|
(3)
|
Excludes sales for license agreement tenants. Totals represent weighted averages.
|
|
|
(4)
|
Includes tenants paying rent for executed leases as of
December 31, 2012
.
|
|
|
(5)
|
Although the Company has less than a 100% interest, it receives all cash flows after payment of debt service, operating expenses and the joint venture partner's preferred return.
|
|
|
(6)
|
Bonita Lakes Mall - We are the lessee under a ground lease for 82 acres, which extends through June 2035, plus one 25-year renewal option. The annual ground rent for 2012 was $36,710, increasing by an average of 3% each year.
|
|
|
(7)
|
Chapel Hill Mall - Ground rent is the greater of $10,000 or 30% of aggregate fixed minimum rent paid by tenants of certain store units. The annual ground rent for 2012 was $10,000.
|
|
|
(8)
|
EastGate Mall - Ground rent is $24,000 per year.
|
|
|
(9)
|
We have one Ross Dress for Less and one Dick's Sporting Goods that are currently under development and scheduled to open in 2013.
|
|
|
(10)
|
The Beall's operating at Lakeshore Mall is unrelated to the Beall's stores at Mall del Norte, Parkdale Mall, Post Oak Mall, Richland Mall, and Sunrise Mall, which are owned by Stage Stores.
|
|
|
(11)
|
Meridian Mall - We are the lessee under several ground leases in effect through March 2067, with extension options. Fixed rent is $18,700 per year plus 3% to 4% of all rents.
|
|
|
(12)
|
Pearland Town Center is a mixed-use center which combines retail, hotel, office and residential components. For segment reporting purposes, the retail portion of the center is classified in Malls, the office portion is classified in Office Buildings, and the hotel and residential portions are classified as Other.
|
|
|
(13)
|
St. Clair Square - We are the lessee under a ground lease for 20 acres. Assuming the exercise of renewal options available, at our election, the ground lease expires January 31, 2073. The rental amount is $40,500 per year. In addition to base rent, the landlord receives 0.25% of Dillard's sales in excess of $16,200,000.
|
|
|
(14)
|
Stroud Mall - We are the lessee under a ground lease, which extends through July 2089. The current rental amount is $60,000 per year, increasing by $10,000 every ten years through 2059. An additional $100,000 is paid every 10 years.
|
|
|
(15)
|
Walnut Square - We are the lessee under several ground leases. Assuming the exercise of renewal options available, at our election, the ground lease expires March 14, 2078. The rental amount is $149,450 per year. In addition to base rent, the landlord receives 20% of the percentage rents collected. The Company has a right of first refusal to purchase the fee.
|
|
|
(16)
|
Wausau Center - Ground rent is $76,000 per year plus 10% of net taxable cash flow.
|
|
|
(17)
|
WestGate Mall - We are the lessee under several ground leases for approximately 53% of the underlying land. Assuming the exercise of renewal options available, at our election, the ground lease expires October 31, 2084. The rental amount is $130,025 per year. In addition to base rent, the landlord
|
receives 20% of the percentage rents collected. The Company has a right of first refusal to purchase the fee.
|
|
(18)
|
Mall stores sales per square foot and occupancy percentage are not applicable as the steps taken to reposition non-core Malls lead to metrics which do not provide relevant information related to the condition of the non-core Malls.
|
Anchors
Anchors are an important factor in a Mall’s successful performance. The public’s identification with a mall property typically focuses on the anchor tenants. Mall anchors are generally a department store whose merchandise appeals to a broad range of shoppers and plays a significant role in generating customer traffic and creating a desirable location for the mall store tenants.
Anchors may own their stores and the land underneath, as well as the adjacent parking areas, or may enter into long-term leases with respect to their stores. Rental rates for anchor tenants are significantly lower than the rents charged to mall store tenants. Total rental revenues from anchors account for 11.7% of the total revenues from our Properties in
2012
. Each anchor that owns its store has entered into an operating and reciprocal easement agreement with us covering items such as operating covenants, reciprocal easements, property operations, initial construction and future expansion.
During
2012
, we added the following anchors and junior anchors (i.e., non-traditional anchors) to the following Malls:
|
|
|
|
|
|
Name
|
|
Property
|
|
Location
|
Carmike Cinemas
|
|
Foothills Mall
|
|
Maryville, TN
|
Celebration Cinema
|
|
Meridian Mall
|
|
Lansing, MI
|
Encore
|
|
Asheville Mall
|
|
Asheville, NC
|
Encore
|
|
Georgia Square
|
|
Athens, GA
|
Encore
|
|
Hanes Mall
|
|
Winston-Salem, NC
|
Encore
|
|
Panama City Mall
|
|
Panama City, FL
|
Forever 21
|
|
Arbor Place
|
|
Atlanta (Douglasville), GA
|
H&M
|
|
Arbor Place
|
|
Atlanta (Douglasville), GA
|
HH Gregg
|
|
Regency Mall
|
|
Racine, WI
|
Jo-Ann Fabric and Craft Stores
|
|
Northpark Mall
|
|
Joplin, MO
|
Jo-Ann Fabric and Craft Stores
|
|
River Ridge Mall
|
|
Lynchburg, VA
|
Party City
|
|
Monroeville Mall
|
|
Pittsburgh, PA
|
Ross
|
|
Jefferson Mall
|
|
Louisville, KY
|
Tilt
|
|
Northpark Mall
|
|
Joplin, MO
|
Ulta
|
|
Valley View Mall
|
|
Roanoke, VA
|
As of
December 31, 2012
, the Malls had a total of
468
anchors and junior anchors including six vacant locations. The mall anchors and junior anchors and the amount of GLA leased or owned by each as of
December 31, 2012
is as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Number of Stores
|
|
Gross Leaseable Area
|
Anchor
|
|
Mall
Leased
|
|
Anchor
Owned
|
|
Total
|
|
Mall
Leased
|
|
Anchor
Owned
|
|
Total
|
JCPenney
(1)
|
|
38
|
|
|
36
|
|
|
74
|
|
|
4,028,429
|
|
|
4,536,841
|
|
|
8,565,270
|
|
Sears
(2)
|
|
20
|
|
|
50
|
|
|
70
|
|
|
2,217,577
|
|
|
7,126,751
|
|
|
9,344,328
|
|
Dillard's
(3)
|
|
4
|
|
|
48
|
|
|
52
|
|
|
660,713
|
|
|
6,805,642
|
|
|
7,466,355
|
|
Sak's
|
|
1
|
|
|
1
|
|
|
2
|
|
|
26,948
|
|
|
83,066
|
|
|
110,014
|
|
Macy's
(4)
|
|
15
|
|
|
31
|
|
|
46
|
|
|
1,957,154
|
|
|
4,964,792
|
|
|
6,921,946
|
|
Belk
(5)
|
|
9
|
|
|
25
|
|
|
34
|
|
|
813,060
|
|
|
3,271,099
|
|
|
4,084,159
|
|
Bon-Ton:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Bon-Ton
|
|
2
|
|
|
1
|
|
|
3
|
|
|
186,824
|
|
|
131,915
|
|
|
318,739
|
|
Bergner's
|
|
1
|
|
|
2
|
|
|
3
|
|
|
128,330
|
|
|
257,071
|
|
|
385,401
|
|
Boston Store
(6)
|
|
1
|
|
|
4
|
|
|
5
|
|
|
96,000
|
|
|
599,280
|
|
|
695,280
|
|
Younkers
|
|
3
|
|
|
1
|
|
|
4
|
|
|
269,060
|
|
|
106,131
|
|
|
375,191
|
|
Elder-Beerman
|
|
3
|
|
|
—
|
|
|
3
|
|
|
194,613
|
|
|
—
|
|
|
194,613
|
|
Parisian
|
|
1
|
|
|
—
|
|
|
1
|
|
|
148,810
|
|
|
—
|
|
|
148,810
|
|
Subtotal
|
|
11
|
|
|
8
|
|
|
19
|
|
|
1,023,637
|
|
|
1,094,397
|
|
|
2,118,034
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Number of Stores
|
|
Gross Leaseable Area
|
Anchor
|
|
Mall
Leased
|
|
Anchor
Owned
|
|
Total
|
|
Mall
Leased
|
|
Anchor
Owned
|
|
Total
|
A'GACI
|
|
1
|
|
|
—
|
|
|
1
|
|
|
28,000
|
|
|
—
|
|
|
28,000
|
|
AMC Theaters
|
|
1
|
|
|
—
|
|
|
1
|
|
|
59,491
|
|
|
—
|
|
|
59,491
|
|
Ashley Home Store
|
|
1
|
|
|
—
|
|
|
1
|
|
|
26,439
|
|
|
—
|
|
|
26,439
|
|
Babies R Us
|
|
1
|
|
|
—
|
|
|
1
|
|
|
30,700
|
|
|
—
|
|
|
30,700
|
|
Barnes & Noble
|
|
15
|
|
|
—
|
|
|
15
|
|
|
442,817
|
|
|
—
|
|
|
442,817
|
|
Bass Pro Outdoor World
|
|
1
|
|
|
—
|
|
|
1
|
|
|
130,000
|
|
|
—
|
|
|
130,000
|
|
Beall Bros.
|
|
5
|
|
|
—
|
|
|
5
|
|
|
193,209
|
|
|
—
|
|
|
193,209
|
|
Beall's (Fla)
|
|
1
|
|
|
—
|
|
|
1
|
|
|
45,844
|
|
|
—
|
|
|
45,844
|
|
Bed, Bath & Beyond
|
|
7
|
|
|
—
|
|
|
7
|
|
|
202,915
|
|
|
—
|
|
|
202,915
|
|
Best Buy
|
|
3
|
|
|
—
|
|
|
3
|
|
|
98,481
|
|
|
—
|
|
|
98,481
|
|
BJ's Wholesale Club
|
|
1
|
|
|
—
|
|
|
1
|
|
|
85,188
|
|
|
—
|
|
|
85,188
|
|
Books A Million
|
|
2
|
|
|
—
|
|
|
2
|
|
|
44,180
|
|
|
—
|
|
|
44,180
|
|
Boscov's
|
|
—
|
|
|
1
|
|
|
1
|
|
|
—
|
|
|
150,000
|
|
|
150,000
|
|
Burlington Coat Factory
|
|
2
|
|
|
—
|
|
|
2
|
|
|
141,664
|
|
|
—
|
|
|
141,664
|
|
Carmike Cinemas
|
|
7
|
|
|
1
|
|
|
8
|
|
|
261,332
|
|
|
54,444
|
|
|
315,776
|
|
Carousel Cinemas
|
|
1
|
|
|
—
|
|
|
1
|
|
|
52,000
|
|
|
—
|
|
|
52,000
|
|
Cinemark Theater
|
|
6
|
|
|
—
|
|
|
6
|
|
|
302,661
|
|
|
—
|
|
|
302,661
|
|
Cohn Furniture
|
|
1
|
|
|
—
|
|
|
1
|
|
|
20,030
|
|
|
—
|
|
|
20,030
|
|
Dick's Sporting Goods
(7)
|
|
13
|
|
|
1
|
|
|
14
|
|
|
714,632
|
|
|
70,000
|
|
|
784,632
|
|
Dunham Sports
|
|
1
|
|
|
—
|
|
|
1
|
|
|
35,368
|
|
|
—
|
|
|
35,368
|
|
Encore
|
|
6
|
|
|
—
|
|
|
6
|
|
|
157,423
|
|
|
—
|
|
|
157,423
|
|
Glowgolf
|
|
1
|
|
|
—
|
|
|
1
|
|
|
22,169
|
|
|
—
|
|
|
22,169
|
|
Goody's
|
|
3
|
|
|
—
|
|
|
3
|
|
|
92,450
|
|
|
—
|
|
|
92,450
|
|
Gordman's
|
|
3
|
|
|
—
|
|
|
3
|
|
|
156,339
|
|
|
—
|
|
|
156,339
|
|
H&M
|
|
3
|
|
|
—
|
|
|
3
|
|
|
61,530
|
|
|
—
|
|
|
61,530
|
|
H.H.Gregg
|
|
1
|
|
|
1
|
|
|
2
|
|
|
25,000
|
|
|
33,887
|
|
|
58,887
|
|
Herberger's
|
|
2
|
|
|
—
|
|
|
2
|
|
|
144,968
|
|
|
—
|
|
|
144,968
|
|
Hobby Lobby
|
|
2
|
|
|
—
|
|
|
2
|
|
|
117,521
|
|
|
—
|
|
|
117,521
|
|
Hollywood Theaters
|
|
2
|
|
|
—
|
|
|
2
|
|
|
101,936
|
|
|
—
|
|
|
101,936
|
|
I. Keating Furniture
|
|
1
|
|
|
—
|
|
|
1
|
|
|
103,994
|
|
|
—
|
|
|
103,994
|
|
Incredible Dave's
|
|
1
|
|
|
—
|
|
|
1
|
|
|
65,044
|
|
|
—
|
|
|
65,044
|
|
Jillian's
|
|
1
|
|
|
—
|
|
|
1
|
|
|
21,295
|
|
|
—
|
|
|
21,295
|
|
Jo-Ann Fabrics
|
|
2
|
|
|
—
|
|
|
2
|
|
|
57,989
|
|
|
—
|
|
|
57,989
|
|
Joe Brand
|
|
1
|
|
|
—
|
|
|
1
|
|
|
29,413
|
|
|
—
|
|
|
29,413
|
|
Joplin Schools
|
|
—
|
|
|
1
|
|
|
1
|
|
|
—
|
|
|
90,000
|
|
|
90,000
|
|
Kids Foot Locker
|
|
1
|
|
|
—
|
|
|
1
|
|
|
22,847
|
|
|
—
|
|
|
22,847
|
|
Kmart
|
|
1
|
|
|
—
|
|
|
1
|
|
|
86,479
|
|
|
—
|
|
|
86,479
|
|
Kohl's
|
|
5
|
|
|
2
|
|
|
7
|
|
|
421,568
|
|
|
132,000
|
|
|
553,568
|
|
Linens & More for Less!
|
|
1
|
|
|
—
|
|
|
1
|
|
|
27,645
|
|
|
—
|
|
|
27,645
|
|
Marshall's
|
|
1
|
|
|
—
|
|
|
1
|
|
|
32,996
|
|
|
—
|
|
|
32,996
|
|
Nordstrom
(8)
|
|
—
|
|
|
2
|
|
|
2
|
|
|
—
|
|
|
385,000
|
|
|
385,000
|
|
Old Navy
|
|
2
|
|
|
—
|
|
|
2
|
|
|
42,497
|
|
|
—
|
|
|
42,497
|
|
Regal Cinemas
|
|
4
|
|
|
—
|
|
|
4
|
|
|
228,302
|
|
|
—
|
|
|
228,302
|
|
REI
|
|
1
|
|
|
—
|
|
|
1
|
|
|
24,427
|
|
|
—
|
|
|
24,427
|
|
Ross Dress For Less
|
|
2
|
|
|
—
|
|
|
2
|
|
|
52,992
|
|
|
—
|
|
|
52,992
|
|
Schuler Books
|
|
1
|
|
|
—
|
|
|
1
|
|
|
24,116
|
|
|
—
|
|
|
24,116
|
|
Scheel's All Sports
|
|
2
|
|
|
—
|
|
|
2
|
|
|
159,245
|
|
|
—
|
|
|
159,245
|
|
Sports Authority
(9)
|
|
1
|
|
|
1
|
|
|
2
|
|
|
24,750
|
|
|
42,085
|
|
|
66,835
|
|
Staples
|
|
1
|
|
|
—
|
|
|
1
|
|
|
20,388
|
|
|
—
|
|
|
20,388
|
|
Stein Mart
|
|
1
|
|
|
—
|
|
|
1
|
|
|
30,463
|
|
|
—
|
|
|
30,463
|
|
Steinhafels
|
|
1
|
|
|
—
|
|
|
1
|
|
|
28,828
|
|
|
—
|
|
|
28,828
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Number of Stores
|
|
Gross Leaseable Area
|
Anchor
|
|
Mall
Leased
|
|
Anchor
Owned
|
|
Total
|
|
Mall
Leased
|
|
Anchor
Owned
|
|
Total
|
Target
|
|
2
|
|
|
4
|
|
|
6
|
|
|
237,600
|
|
|
490,476
|
|
|
728,076
|
|
The Rush Fitness Complex
|
|
1
|
|
|
—
|
|
|
1
|
|
|
30,566
|
|
|
—
|
|
|
30,566
|
|
Tilt
|
|
1
|
|
|
—
|
|
|
1
|
|
|
22,484
|
|
|
—
|
|
|
22,484
|
|
TJ Maxx
|
|
3
|
|
|
—
|
|
|
3
|
|
|
86,886
|
|
|
—
|
|
|
86,886
|
|
Toys R Us
|
|
1
|
|
|
—
|
|
|
1
|
|
|
29,398
|
|
|
—
|
|
|
29,398
|
|
Tuesday Morning
|
|
1
|
|
|
—
|
|
|
1
|
|
|
31,092
|
|
|
—
|
|
|
31,092
|
|
United Artists Theatre
|
|
2
|
|
|
—
|
|
|
2
|
|
|
59,180
|
|
|
—
|
|
|
59,180
|
|
V-Stock
|
|
3
|
|
|
—
|
|
|
3
|
|
|
95,098
|
|
|
—
|
|
|
95,098
|
|
Von Maur
|
|
—
|
|
|
2
|
|
|
2
|
|
|
—
|
|
|
233,280
|
|
|
233,280
|
|
Wehrenberg Theaters
|
|
1
|
|
|
—
|
|
|
1
|
|
|
56,000
|
|
|
—
|
|
|
56,000
|
|
XXI Forever / Forever 21
|
|
7
|
|
|
—
|
|
|
7
|
|
|
235,335
|
|
|
—
|
|
|
235,335
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Under Development:
|
|
|
|
|
|
|
|
|
|
|
|
|
Dick's Sporting Goods
(10)
|
|
1
|
|
|
—
|
|
|
1
|
|
|
91,770
|
|
|
—
|
|
|
91,770
|
|
Ross Dress For Less
(10)
|
|
—
|
|
|
1
|
|
|
1
|
|
|
—
|
|
|
234,538
|
|
|
234,538
|
|
Cinemark Theater
(10)
|
|
1
|
|
|
—
|
|
|
1
|
|
|
28,263
|
|
|
—
|
|
|
28,263
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Vacant Anchors:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Belk
|
|
—
|
|
|
1
|
|
|
1
|
|
|
—
|
|
|
96,853
|
|
|
96,853
|
|
Office Max
|
|
1
|
|
|
—
|
|
|
1
|
|
|
23,600
|
|
|
—
|
|
|
23,600
|
|
Dillard's
|
|
—
|
|
|
1
|
|
|
1
|
|
|
—
|
|
|
182,260
|
|
|
182,260
|
|
Linens N Things
|
|
1
|
|
|
—
|
|
|
1
|
|
|
32,060
|
|
|
—
|
|
|
32,060
|
|
Old Navy
|
|
1
|
|
|
—
|
|
|
1
|
|
|
31,858
|
|
|
—
|
|
|
31,858
|
|
Shopko
|
|
1
|
|
|
—
|
|
|
1
|
|
|
23,636
|
|
|
—
|
|
|
23,636
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
250
|
|
|
218
|
|
|
468
|
|
|
17,141,909
|
|
|
30,077,411
|
|
|
47,219,320
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
Of the 36 stores owned by JC Penny, six are subject to ground lease payments to the Company.
|
|
|
(2)
|
Of the 50 stores owned by Sears, four are subject to ground lease payments to the Company.
|
|
|
(3)
|
Of the 48 stores owned by Dillard's, four are subject to ground lease payments to the Company.
|
|
|
(4)
|
Of the 31 stores owned by Macy's, five are subject to ground lease payments to the Company.
|
|
|
(5)
|
Of the 25 stores owned by Belk, two are subject to ground lease payments to the Company.
|
|
|
(6)
|
Of the four stores owned by Boston Store, one is subject to ground lease payments to the Company.
|
|
|
(7)
|
The one store owned by Dick's Sporting Goods is subject to ground lease payments to the Company.
|
|
|
(8)
|
Of the two stores owned by Nordstrom, one is subject to ground lease payments to the Company.
|
|
|
(9)
|
The one store owned by Sports Authority is subject to ground lease payments to the Company.
|
|
|
(10)
|
Store is under development and will open in 2013.
|
Mall Stores
The Malls have approximately 8,160 mall stores. National and regional retail chains (excluding local franchises) lease approximately 81.4% of the occupied mall store GLA. Although mall stores occupy only 29.3% of the total mall GLA (the remaining 70.7% is occupied by anchors), the Malls received 83.0% of their revenues from mall stores for the year ended
December 31, 2012
.
Mall Lease Expirations
The following table summarizes the scheduled lease expirations for mall stores as of
December 31, 2012
:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year Ending
December 31,
|
|
Number of
Leases
Expiring
|
|
Annualized
Gross Rent
(1)
|
|
GLA of
Expiring
Leases
|
|
Average
Annualized
Gross Rent
Per Square
Foot
|
|
Expiring
Leases as % of
Total
Annualized
Gross Rent
(2)
|
|
Expiring
Leases as a %
of Total Leased
GLA
(3)
|
2013
|
|
1,591
|
|
|
$
|
111,695,000
|
|
|
3,886,000
|
|
|
$
|
28.74
|
|
|
14.8
|
%
|
|
19.9
|
%
|
2014
|
|
883
|
|
|
89,037,000
|
|
|
2,385,000
|
|
|
37.33
|
|
|
11.8
|
%
|
|
12.2
|
%
|
2015
|
|
864
|
|
|
94,959,000
|
|
|
2,353,000
|
|
|
40.36
|
|
|
12.6
|
%
|
|
12.0
|
%
|
2016
|
|
845
|
|
|
97,977,000
|
|
|
2,351,000
|
|
|
41.68
|
|
|
13.0
|
%
|
|
12.0
|
%
|
2017
|
|
703
|
|
|
86,788,000
|
|
|
2,082,000
|
|
|
41.68
|
|
|
11.5
|
%
|
|
10.6
|
%
|
2018
|
|
506
|
|
|
72,938,000
|
|
|
1,710,000
|
|
|
42.66
|
|
|
9.7
|
%
|
|
8.7
|
%
|
2019
|
|
281
|
|
|
42,058,000
|
|
|
965,000
|
|
|
43.60
|
|
|
5.6
|
%
|
|
4.9
|
%
|
2020
|
|
278
|
|
|
40,054,000
|
|
|
928,000
|
|
|
43.17
|
|
|
5.3
|
%
|
|
4.7
|
%
|
2021
|
|
328
|
|
|
43,923,000
|
|
|
1,118,000
|
|
|
39.28
|
|
|
5.8
|
%
|
|
5.7
|
%
|
2022
|
|
336
|
|
|
46,136,000
|
|
|
1,130,000
|
|
|
40.82
|
|
|
6.1
|
%
|
|
5.8
|
%
|
|
|
(1)
|
Total annualized gross rent, including recoverable common area expenses and real estate taxes, in effect at
December 31, 2012
for expiring leases that were executed as of
December 31, 2012
.
|
|
|
(2)
|
Total annualized gross rent, including recoverable common area expenses and real estate taxes, of expiring leases as a percentage of the total annualized gross rent of all leases that were executed as of
December 31, 2012
.
|
|
|
(3)
|
Total GLA of expiring leases as a percentage of the total GLA of all leases that were executed as of
December 31, 2012
.
|
See page 53 for a comparison between rents on leases that expired in the current reporting period compared to rents on new and renewal leases executed in 2012. Our goal is to continue to convert shorter term leases to longer terms. For leases expiring in 2013 that we are able to renew or replace with new tenants, we anticipate that we will be able to achieve higher rental rates than the existing rates of the expiring leases as retailers seek out space in our market-dominant Properties and new supply remains constricted. We anticipate that we will be able to achieve spreads similar to those achieved in 2012 as presented on page 54.
Mall Tenant Occupancy Costs
Occupancy cost is a tenant’s total cost of occupying its space, divided by sales. Mall store sales represents total sales amounts received from reporting tenants with space of less than 10,000 square feet. The following table summarizes tenant occupancy costs as a percentage of total mall store sales, excluding license agreements, for the three years ended December 31, 2012:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year Ended December 31,
|
|
|
2012
|
|
2011
|
|
2010
|
Mall store sales (in millions)
(1)
|
|
$
|
5,767.43
|
|
|
$
|
5,498.01
|
|
|
$
|
5,667.70
|
|
Minimum rents
|
|
8.29
|
%
|
|
8.39
|
%
|
|
8.74
|
%
|
Percentage rents
|
|
0.62
|
%
|
|
0.59
|
%
|
|
0.61
|
%
|
Tenant reimbursements
(2)
|
|
3.67
|
%
|
|
3.78
|
%
|
|
4.04
|
%
|
Mall tenant occupancy costs
|
|
12.58
|
%
|
|
12.76
|
%
|
|
13.39
|
%
|
|
|
|
(1)
|
Represents 100% of sales for the Malls. In certain cases, we own less than a 100% interest in the Malls. Excludes Kirkwood Mall, which was acquired in December 2012
|
(2)
|
Represents reimbursements for real estate taxes, insurance, common area maintenance charges, marketing and certain capital expenditures.
|
Debt on Malls
Please see the table entitled “Mortgage Loans Outstanding at
December 31, 2012
” included herein for information regarding any liens or encumbrances related to our Malls.
Associated Centers
We owned a controlling interest in
28
Associated Centers and a non-controlling interest in
four
Associated Centers as of
December 31, 2012
.
Associated Centers are retail properties that are adjacent to a regional mall complex and include one or more anchors, or big box retailers, along with smaller tenants. Anchor tenants typically include tenants such as T.J. Maxx, Target, Kohl’s and Bed Bath & Beyond. Associated Centers are managed by the staff at the Mall since it is adjacent to and usually benefits from the customers drawn to the Mall.
We own the land underlying the Associated Centers in fee simple interest, except for Bonita Lakes Crossing, which is subject to a long-term ground lease.
The following table sets forth certain information for each of the Associated Centers as of
December 31, 2012
:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Associated Center / Location
|
|
Year of Opening/ Most Recent Expansion
|
|
Company's
Ownership
|
|
Total GLA
(1)
|
|
Total
Leasable
GLA
(2)
|
|
Percentage
GLA
Occupied
(3)
|
|
Anchors
|
Annex at Monroeville
Pittsburgh, PA
|
|
1986
|
|
100
|
%
|
|
186,342
|
|
|
186,342
|
|
|
96
|
%
|
|
Burlington Coat Factory, Dick's Sporting Goods
|
Bonita Lakes Crossing
(4)
Meridian, MS
|
|
1997/1999
|
|
100
|
%
|
|
147,518
|
|
|
147,518
|
|
|
97
|
%
|
|
Ashley Home Store, Office Max, T.J. Maxx
|
Chapel Hill Suburban
(5)
Akron, OH
|
|
1969
|
|
62.8
|
%
|
|
116,752
|
|
|
116,752
|
|
|
77
|
%
|
|
Roses
|
Coastal Grand Crossing
Myrtle Beach, SC
|
|
2005
|
|
50
|
%
|
|
35,013
|
|
|
35,013
|
|
|
97
|
%
|
|
PetSmart
|
CoolSprings Crossing
Nashville, TN
|
|
1992
|
|
100
|
%
|
|
167,470
|
|
|
63,010
|
|
|
91
|
%
|
|
American Signature
(6)
, HH Gregg
(7)
, Lifeway Christian Store, Target
(6)
, Toys R Us
(6)
, Whole Foods
(7)
|
Courtyard at Hickory Hollow
Nashville, TN
|
|
1979
|
|
100
|
%
|
|
71,038
|
|
|
71,038
|
|
|
85
|
%
|
|
Carmike Cinema
|
EastGate Crossing
Cincinnati, OH
|
|
1991 / 2012
|
|
100
|
%
|
|
207,223
|
|
|
183,739
|
|
|
87
|
%
|
|
Kroger, Marshall's, Office Max
(6)
|
Foothills Plaza
Maryville, TN
|
|
1983/1986
|
|
100
|
%
|
|
71,274
|
|
|
71,274
|
|
|
100
|
%
|
|
Ollie's Bargain Outlet
|
Frontier Square
Cheyenne, WY
|
|
1985
|
|
100
|
%
|
|
186,552
|
|
|
16,527
|
|
|
100
|
%
|
|
PETCO
(8)
, Ross
(8)
, Target
(6)
, T.J .Maxx
(8)
|
Georgia Square Plaza
Athens, GA
|
|
1984
|
|
100
|
%
|
|
15,493
|
|
|
15,493
|
|
|
100
|
%
|
|
Georgia Theatre Company
|
Governor's Square Plaza
Clarksville, TN
|
|
1985/1988
|
|
50
|
%
|
|
200,862
|
|
|
57,283
|
|
|
100
|
%
|
|
Bed Bath & Beyond, Premier Medical Group, Target
(6)
|
Gunbarrel Pointe
Chattanooga, TN
|
|
2000
|
|
100
|
%
|
|
273,913
|
|
|
147,913
|
|
|
100
|
%
|
|
Earthfare, Kohl's,Target
|
Hamilton Corner
Chattanooga, TN
|
|
1990/2005
|
|
90
|
%
|
|
67,243
|
|
|
67,243
|
|
|
100
|
%
|
|
PETCO
|
Hamilton Crossing
Chattanooga, TN
|
|
1987/2005
|
|
92
|
%
|
|
191,873
|
|
|
98,757
|
|
|
100
|
%
|
|
HomeGoods
(9)
, Michaels
(9)
, T.J. Maxx, Toys R Us
(6)
|
Harford Annex
Bel Air, MD
|
|
1973/2003
|
|
100
|
%
|
|
107,656
|
|
|
107,656
|
|
|
100
|
%
|
|
Best Buy, Office Depot, PetSmart
|
The Landing at Arbor Place
Atlanta (Douglasville), GA
|
|
1999
|
|
100
|
%
|
|
162,954
|
|
|
85,267
|
|
|
85
|
%
|
|
Michaels, Shoe Carnival, Toys R Us
(6)
|
Layton Hills Convenience Center
Layton, UT
|
|
1980
|
|
100
|
%
|
|
91,379
|
|
|
91,379
|
|
|
100
|
%
|
|
Big Lots, Dollar Tree, Downeast Outfitters
|
Layton Hills Plaza
Layton, UT
|
|
1989
|
|
100
|
%
|
|
18,801
|
|
|
18,801
|
|
|
100
|
%
|
|
None
|
Madison Plaza
Huntsville, AL
|
|
1984
|
|
100
|
%
|
|
153,503
|
|
|
99,108
|
|
|
73
|
%
|
|
Haverty's, HH Gregg
(10),
TouchStar Cinema
(5)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Associated Center / Location
|
|
Year of Opening/ Most Recent Expansion
|
|
Company's
Ownership
|
|
Total GLA
(1)
|
|
Total
Leasable
GLA
(2)
|
|
Percentage
GLA
Occupied
(3)
|
|
Anchors
|
Parkdale Crossing
Beaumont, TX
|
|
2002
|
|
100
|
%
|
|
80,102
|
|
|
80,102
|
|
|
98
|
%
|
|
Barnes & Noble
|
The Plaza at Fayette
Lexington, KY
|
|
2006
|
|
100
|
%
|
|
190,207
|
|
|
130,803
|
|
|
100
|
%
|
|
Cinemark, Gordman's, Guitar Center
|
The Shoppes at Hamilton Place
Chattanooga, TN
|
|
2003
|
|
92
|
%
|
|
131,274
|
|
|
131,274
|
|
|
97
|
%
|
|
Bed Bath & Beyond, Marshall's, Ross
|
The Shoppes at Panama City
Panama City, FL
|
|
2004
|
|
100
|
%
|
|
61,221
|
|
|
61,221
|
|
|
96
|
%
|
|
Best Buy
|
The Shoppes at St. Clair Square
(5)
Fairview Heights, IL
|
|
2007
|
|
62.8
|
%
|
|
84,383
|
|
|
84,383
|
|
|
100
|
%
|
|
Barnes & Noble
|
Sunrise Commons
Brownsville, TX
|
|
2001
|
|
100
|
%
|
|
201,960
|
|
|
100,515
|
|
|
100
|
%
|
|
K-Mart
(6)
, Marshall's, Ross
|
The Terrace
Chattanooga, TN
|
|
1997
|
|
92
|
%
|
|
156,468
|
|
|
156,468
|
|
|
100
|
%
|
|
Academy Sports, Staples
|
Triangle Town Place
Raleigh, NC
|
|
2004
|
|
50
|
%
|
|
149,471
|
|
|
149,471
|
|
|
100
|
%
|
|
Bed Bath & Beyond, Dick's Sporting Goods, DSW Shoes
|
Village at RiverGate
Nashville, TN
|
|
1981/1998
|
|
100
|
%
|
|
164,106
|
|
|
64,106
|
|
|
96
|
%
|
|
Chuck E. Cheese, Essex Retail Outlet, Target
(6)
|
West Towne Crossing
Madison, WI
|
|
1980
|
|
100
|
%
|
|
433,743
|
|
|
104,234
|
|
|
100
|
%
|
|
Barnes & Noble, Best Buy, Cub Foods
(6)
, Kohl's
(6)
, Office Max
(6)
, Shopko
(6)
|
WestGate Crossing
Spartanburg, SC
|
|
1985/1999
|
|
100
|
%
|
|
157,870
|
|
|
157,870
|
|
|
71
|
%
|
|
Hamricks, Jo-Ann Fabric and Craft Stores
|
Westmoreland Crossing
Greensburg, PA
|
|
2002
|
|
62.8
|
%
|
|
281,070
|
|
|
281,070
|
|
|
100
|
%
|
|
Carmike Cinema, Dick's Sporting Goods, Levin Furniture, Michaels
(11)
, T.J. Maxx
(11)
|
York Town Center
York, PA
|
|
2007
|
|
50
|
%
|
|
273,404
|
|
|
273,404
|
|
|
98
|
%
|
|
Bed Bath & Beyond, Best Buy, Christmas Tree Store, Dick's Sporting Goods, Ross, Staples
|
Total Associated Centers
|
|
|
|
|
|
|
4,838,138
|
|
|
3,455,034
|
|
|
95
|
%
|
|
|
|
|
(1)
|
Includes total square footage of the anchors (whether owned or leased by the anchor) and shops. Does not include future expansion areas.
|
|
|
(2)
|
Includes leasable anchors.
|
|
|
(3)
|
Includes tenants paying rent for executed leases as of
December 31, 2012
, including leased anchors.
|
|
|
(4)
|
Bonita Lakes Crossing - We are the lessee under a ground lease for 34 acres, which extends through June 2035, including one 25-year renewal option. The annual rent at
December 31, 2012
was $25,510, increasing by an average of 3% each year.
|
|
|
(5)
|
Although the Company has less than a 100% interest, it receives all cash flows after payment of debt service, operating expenses and the joint venture partner's preferred return.
|
|
|
(7)
|
CoolSprings Crossing - Space is owned by SM Newco Franklin LLC, an affiliate of Developers Diversified, and subleased to HH Gregg and Whole Foods (vacant).
|
|
|
(8)
|
Frontier Square - Space is owned by 1639 11th Street Associates and subleased to PETCO, Ross, and T.J. Maxx.
|
|
|
(9)
|
Hamilton Crossing - Space is owned by Schottenstein Property Group and subleased to HomeGoods and Michaels.
|
|
|
(10)
|
Madison Plaza - Space is owned by SM Newco Huntsville LLC, an affiliate of Developers Diversified, and subleased to HH Gregg.
|
|
|
(11)
|
Westmoreland Crossing - Space is owned by Schottenstein Property Group and subleased to Michaels and T.J. Maxx.
|
Associated Centers Lease Expirations
The following table summarizes the scheduled lease expirations for Associated Center tenants in occupancy as of
December 31, 2012
:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year Ending
December 31,
|
|
Number of
Leases
Expiring
|
|
Annualized
Gross Rent
(1)
|
|
GLA of
Expiring
Leases
|
|
Average
Annualized
Gross Rent
Per Square
Foot
|
|
Expiring
Leases as % of
Total
Annualized
Gross Rent
(2)
|
|
Expiring
Leases as %
of Total Leased
GLA
(3)
|
2013
|
|
28
|
|
|
$
|
2,443,000
|
|
|
190,000
|
|
|
$
|
12.88
|
|
|
5.7
|
%
|
|
6.0
|
%
|
2014
|
|
35
|
|
|
3,832,000
|
|
|
290,000
|
|
|
13.20
|
|
|
8.9
|
%
|
|
9.2
|
%
|
2015
|
|
48
|
|
|
5,300,000
|
|
|
352,000
|
|
|
15.04
|
|
|
12.3
|
%
|
|
11.1
|
%
|
2016
|
|
35
|
|
|
5,768,000
|
|
|
391,000
|
|
|
14.76
|
|
|
13.4
|
%
|
|
12.3
|
%
|
2017
|
|
46
|
|
|
5,974,000
|
|
|
364,000
|
|
|
16.40
|
|
|
13.9
|
%
|
|
11.5
|
%
|
2018
|
|
24
|
|
|
3,818,000
|
|
|
234,000
|
|
|
16.34
|
|
|
8.9
|
%
|
|
7.4
|
%
|
2019
|
|
15
|
|
|
2,408,000
|
|
|
165,000
|
|
|
14.57
|
|
|
5.6
|
%
|
|
5.2
|
%
|
2020
|
|
10
|
|
|
1,873,000
|
|
|
214,000
|
|
|
8.74
|
|
|
4.4
|
%
|
|
6.8
|
%
|
2021
|
|
12
|
|
|
4,576,000
|
|
|
363,000
|
|
|
12.62
|
|
|
10.7
|
%
|
|
11.5
|
%
|
2022
|
|
19
|
|
|
3,749,000
|
|
|
297,000
|
|
|
12.63
|
|
|
8.7
|
%
|
|
9.4
|
%
|
|
|
(1)
|
Total annualized gross rent, including recoverable common area expenses and real estate taxes, in effect at
|
December 31, 2012
for expiring leases that were executed as of
December 31, 2012
.
|
|
(2)
|
Total annualized gross rent, including recoverable common area expenses and real estate taxes, of expiring leases as a
|
percentage of the total annualized gross rent of all leases that were executed as of
December 31, 2012
.
|
|
(3)
|
Total GLA of expiring leases as a percentage of the total GLA of all leases that were executed as of
December 31, 2012
.
|
Debt on Associated Centers
Please see the table entitled “Mortgage Loans Outstanding at
December 31, 2012
” included herein for information regarding any liens or encumbrances related to our Associated Centers.
Community Centers
We owned a controlling interest in
six
Community Centers and a non-controlling interest in
four
Community Centers as of
December 31, 2012
. Community Centers typically have less development risk because of shorter development periods and lower costs. While Community Centers generally maintain higher occupancy levels and are more stable, they typically have slower rent growth because the anchor stores’ rents are typically fixed and are for longer terms.
Community Centers are designed to attract local and regional area customers and are typically anchored by a combination of supermarkets, or value-priced stores that attract shoppers to each center’s small shops. The tenants at our Community Centers typically offer necessities, value-oriented and convenience merchandise.
We own the land underlying the Community Centers in fee simple interest.
The following table sets forth certain information for each of our Community Centers at
December 31, 2012
:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Community Center / Location
|
|
Year of Opening/ Most Recent Expansion
|
|
Company's Ownership
|
|
Total
GLA
(1)
|
|
Total
Leasable
GLA
(2)
|
|
Percentage
GLA
Occupied
(3)
|
|
Anchors
|
Cobblestone Village at Palm Coast
Palm Coast, FL
|
|
2007
|
|
100
|
%
|
|
96,891
|
|
|
22,876
|
|
|
99
|
%
|
|
Belk
(4)
|
Hammock Landing
West Melbourne, FL
|
|
2009
|
|
50
|
%
|
|
343,897
|
|
|
206,896
|
|
|
93
|
%
|
|
HH Gregg, Kohl's
(4)
, Marshall's, Michaels, Ross, Target
(4)
|
High Pointe Commons
Harrisburg, PA
|
|
2006/2008
|
|
50
|
%
|
|
341,853
|
|
|
118,850
|
|
|
96
|
%
|
|
Christmas Tree Shops, JC Penney
(4)
, Target
(4)
|
Pemberton Plaza
Vicksburg, MS
|
|
1986
|
|
100
|
%
|
|
77,894
|
|
|
26,948
|
|
|
96
|
%
|
|
TJ Maxx
(5)
|
Renaissance Center
Durham, NC
|
|
2003/2007
|
|
50
|
%
|
|
314,691
|
|
|
314,691
|
|
|
96
|
%
|
|
Best Buy, Nordstrom, REI, Toys R Us
|
Statesboro Crossing
Statesboro, GA
|
|
2008
|
|
100
|
%
|
|
136,958
|
|
|
136,958
|
|
|
99
|
%
|
|
Hobby Lobby, T.J. Maxx
|
The Forum at Grandview
Madison, MS
|
|
2010/2012
|
|
75
|
%
|
|
189,719
|
|
|
189,719
|
|
|
100
|
%
|
|
Best Buy, Dick’s Sporting Goods, HomeGoods, Michaels, Stein Mart
|
The Pavilion at Port Orange
Port Orange, FL
|
|
2010
|
|
50
|
%
|
|
329,005
|
|
|
322,010
|
|
|
96
|
%
|
|
Belk, Hollywood Theaters, Marshall's, Michaels
|
The Promenade
D'Iberville, MS
|
|
2009
|
|
85
|
%
|
|
522,322
|
|
|
305,362
|
|
|
92
|
%
|
|
Best Buy, Dick's Sporting Goods, Kohl's
(4)
, Marshall's, Michaels, Target
(4)
|
Waynesville Commons
Waynesville, NC
|
|
2012
|
|
100
|
%
|
|
126,967
|
|
|
41,967
|
|
|
100
|
%
|
|
Belk
|
Total Community Centers
|
|
|
|
|
|
|
2,480,197
|
|
|
1,686,277
|
|
|
96
|
%
|
|
|
|
|
(1)
|
Includes total square footage of the Anchors (whether owned or leased by the Anchor) and shops. Does not include future expansion areas.
|
|
|
(2)
|
Includes leasable Anchors.
|
|
|
(3)
|
Includes tenants paying rent for executed leases as of
December 31, 2012
,including leased anchors.
|
|
|
(5)
|
Pemberton Plaza - Space is owned by The Kroger Company and subleased to T.J. Maxx.
|
Community Centers Lease Expirations
The following table summarizes the scheduled lease expirations for tenants in occupancy at Community Centers as of
December 31, 2012
:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year Ending
December 31,
|
|
Number of
Leases
Expiring
|
|
Annualized
Gross Rent
(1)
|
|
GLA of
Expiring
Leases
|
|
Average
Annualized
Gross Rent
Per Square
Foot
|
|
Expiring
Leases as % of
Total
Annualized
Gross Rent
(2)
|
|
Expiring
Leases as a
% of Total
Leased
GLA
(3)
|
2013
|
|
12
|
|
|
$
|
1,581,000
|
|
|
77,000
|
|
|
$
|
20.49
|
|
|
4.1
|
%
|
|
3.5
|
%
|
2014
|
|
43
|
|
|
3,193,000
|
|
|
109,000
|
|
|
29.31
|
|
|
8.3
|
%
|
|
4.9
|
%
|
2015
|
|
30
|
|
|
2,313,000
|
|
|
93,000
|
|
|
24.97
|
|
|
6.0
|
%
|
|
4.2
|
%
|
2016
|
|
25
|
|
|
1,481,000
|
|
|
67,000
|
|
|
22.05
|
|
|
3.8
|
%
|
|
3.0
|
%
|
2017
|
|
44
|
|
|
4,598,000
|
|
|
197,000
|
|
|
23.32
|
|
|
11.9
|
%
|
|
8.9
|
%
|
2018
|
|
21
|
|
|
3,744,000
|
|
|
221,000
|
|
|
16.97
|
|
|
9.7
|
%
|
|
10.0
|
%
|
2019
|
|
22
|
|
|
3,534,000
|
|
|
181,000
|
|
|
19.55
|
|
|
9.1
|
%
|
|
8.2
|
%
|
2020
|
|
23
|
|
|
4,892,000
|
|
|
341,000
|
|
|
14.35
|
|
|
12.7
|
%
|
|
15.5
|
%
|
2021
|
|
14
|
|
|
2,907,000
|
|
|
185,000
|
|
|
15.71
|
|
|
7.5
|
%
|
|
8.4
|
%
|
2022
|
|
25
|
|
|
3,482,000
|
|
|
190,000
|
|
|
18.28
|
|
|
9.0
|
%
|
|
8.6
|
%
|
|
|
(1)
|
Total annualized gross rent, including recoverable common area expenses and real estate taxes, in effect at
December 31, 2012
for expiring leases that were executed as of
December 31, 2012
.
|
|
|
(2)
|
Total annualized gross rent, including recoverable common area expenses and real estate taxes, of expiring leases as a percentage of the total annualized gross rent of all leases that were executed as of
December 31, 2012
.
|
|
|
(3)
|
Total GLA of expiring leases as a percentage of the total GLA of all leases that were executed as of
December 31, 2012
.
|
Debt on Community Centers
Please see the table entitled “Mortgage Loans Outstanding at
December 31, 2012
” included herein for information regarding any liens or encumbrances related to our Community Centers.
Office Buildings
We owned a controlling interest in
13
Office Buildings and a non-controlling interest in
seven
Office Buildings as of
December 31, 2012
.
We own a 92% interest in the 128,000 square foot office building where our corporate headquarters is located. As of
December 31, 2012
, we occupied 60.2% of the total square footage of the building.
The following tables set forth certain information for each of our Office Buildings at
December 31, 2012
:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Office Building / Location
|
|
Year of Opening/ Most Recent Expansion
|
|
Company's Ownership
|
|
Total
GLA
(1)
|
|
Total
Leasable
GLA
|
|
Percentage
GLA
Occupied
|
840 Greenbrier Circle
Chesapeake, VA
|
|
1983
|
|
100
|
%
|
|
50,820
|
|
|
50,820
|
|
|
87
|
%
|
850 Greenbrier Circle
Chesapeake, VA
|
|
1984
|
|
100
|
%
|
|
81,318
|
|
|
81,318
|
|
|
100
|
%
|
1500 Sunday Drive
Raleigh, NC
|
|
2000
|
|
100
|
%
|
|
61,412
|
|
|
61,412
|
|
|
97
|
%
|
Bank of America Building
Greensboro, NC
|
|
1988
|
|
50
|
%
|
|
49,327
|
|
|
49,327
|
|
|
98
|
%
|
CBL Center
Chattanooga, TN
|
|
2001
|
|
92
|
%
|
|
130,216
|
|
|
130,216
|
|
|
97
|
%
|
CBL Center II
Chattanooga, TN
|
|
2008
|
|
92
|
%
|
|
77,211
|
|
|
77,211
|
|
|
93
|
%
|
First Citizens Bank Building
Greensboro, NC
|
|
1985
|
|
50
|
%
|
|
43,088
|
|
|
43,088
|
|
|
72
|
%
|
First National Bank Building
Greensboro, NC
|
|
1990
|
|
50
|
%
|
|
3,774
|
|
|
3,774
|
|
|
100
|
%
|
Friendly Center Office Building
Greensboro, NC
|
|
1972
|
|
50
|
%
|
|
32,262
|
|
|
32,262
|
|
|
90
|
%
|
Green Valley Office Building
Greensboro, NC
|
|
1973
|
|
50
|
%
|
|
27,604
|
|
|
27,604
|
|
|
60
|
%
|
Lake Point Office Building
(2)
Greensboro, NC
|
|
1996
|
|
100
|
%
|
|
87,895
|
|
|
87,895
|
|
|
96
|
%
|
Oak Branch Business Center
Greensboro, NC
|
|
1990/1995
|
|
100
|
%
|
|
33,622
|
|
|
33,622
|
|
|
77
|
%
|
One Oyster Point
Newport News, VA
|
|
1984
|
|
100
|
%
|
|
36,097
|
|
|
36,097
|
|
|
38
|
%
|
The Pavilion at Port Orange
Port Orange, FL
|
|
2010
|
|
50
|
%
|
|
26,785
|
|
|
26,785
|
|
|
89
|
%
|
Pearland Office
Pearland, TX
|
|
2009
|
|
88
|
%
|
|
29,509
|
|
|
29,509
|
|
|
100
|
%
|
Peninsula Business Center I
Newport News, VA
|
|
1985
|
|
100
|
%
|
|
21,886
|
|
|
21,886
|
|
|
91
|
%
|
Peninsula Business Center II
Newport News, VA
|
|
1985
|
|
100
|
%
|
|
40,430
|
|
|
40,430
|
|
|
100
|
%
|
Suntrust Bank Building
(2)
Greensboro, NC
|
|
1998
|
|
100
|
%
|
|
106,959
|
|
|
106,959
|
|
|
96
|
%
|
Two Oyster Point
Newport News, VA
|
|
1985
|
|
100
|
%
|
|
39,283
|
|
|
39,283
|
|
|
79
|
%
|
Wachovia Office Building
Greensboro, NC
|
|
1992
|
|
50
|
%
|
|
12,000
|
|
|
12,000
|
|
|
100
|
%
|
Total Office Buildings
|
|
|
|
|
|
|
991,498
|
|
|
991,498
|
|
|
90
|
%
|
(1) Includes total square footage of the offices. Does not include future expansion areas.
(2) We sold these Properties on January 9, 2013. They were classified as held for sale as of December 31, 2012.
Office Buildings Lease Expirations
The following table summarizes the scheduled lease expirations for tenants in occupancy at Office Buildings as of
December 31, 2012
:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year Ending
December 31,
|
|
Number of
Leases
Expiring
|
|
Annualized
Gross Rent (1)
|
|
GLA of
Expiring
Leases
|
|
Average
Annualized
Gross Rent
Per Square
Foot
|
|
Expiring Leases
as % of Total
Annualized
Gross Rent (2)
|
|
Expiring
Leases as a
% of Total
Leased
GLA (3)
|
2013
|
|
52
|
|
|
$
|
4,794,000
|
|
|
82,000
|
|
|
$
|
58.17
|
|
|
15.8
|
%
|
|
10.2
|
%
|
2014
|
|
36
|
|
|
4,792,000
|
|
|
76,000
|
|
|
62.77
|
|
|
15.8
|
%
|
|
9.4
|
%
|
2015
|
|
39
|
|
|
4,769,000
|
|
|
112,000
|
|
|
42.76
|
|
|
15.7
|
%
|
|
13.7
|
%
|
2016
|
|
27
|
|
|
3,580,000
|
|
|
89,000
|
|
|
40.42
|
|
|
11.8
|
%
|
|
10.9
|
%
|
2017
|
|
23
|
|
|
3,279,000
|
|
|
160,000
|
|
|
20.54
|
|
|
10.8
|
%
|
|
19.7
|
%
|
2018
|
|
12
|
|
|
3,200,000
|
|
|
98,000
|
|
|
32.69
|
|
|
10.5
|
%
|
|
12.1
|
%
|
2019
|
|
5
|
|
|
1,592,000
|
|
|
50,000
|
|
|
31.61
|
|
|
5.2
|
%
|
|
6.2
|
%
|
2020
|
|
1
|
|
|
488,000
|
|
|
27,000
|
|
|
17.94
|
|
|
1.6
|
%
|
|
3.4
|
%
|
2021
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
%
|
|
—
|
%
|
2022
|
|
2
|
|
|
410,000
|
|
|
15,000
|
|
|
28.05
|
|
|
1.3
|
%
|
|
1.8
|
%
|
|
|
(1)
|
Total annualized contractual gross rent, including recoverable common area expenses and real estate taxes, in effect at
December 31, 2012
for expiring leases that were executed as of
December 31, 2012
.
|
|
|
(2)
|
Total annualized contractual gross rent, including recoverable common area expenses and real estate taxes, of expiring leases as a percentage of the total annualized gross rent of all leases that were executed as of
December 31, 2012
.
|
|
|
(3)
|
Total GLA of expiring leases as a percentage of the total GLA of all leases that were executed as of
December 31, 2012
.
|
Debt on Office Buildings
Please see the table entitled “Mortgage Loans Outstanding at
December 31, 2012
” included herein for information regarding any liens or encumbrances related to our Offices.
Mortgages Notes Receivable
We own
six
mortgages, each of which is collateralized by either a first mortgage, a second mortgage or by assignment of 100% of the ownership interests in the underlying real estate and related improvements. The mortgages are more fully described on Schedule IV in Part IV of this report.
Mortgage Loans Outstanding at
December 31, 2012
(in thousands):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Property
|
|
Our
Ownership
Interest
|
|
Stated
Interest
Rate
|
|
Principal
Balance as of
12/31/12
(1)
|
|
Annual
Debt
Service
|
|
Maturity
Date
|
|
Optional Extended Maturity Date
|
|
Balloon
Payment Due
on Maturity
|
|
Open to Prepayment
Date
(2)
|
|
|
Consolidated Debt
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Malls:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Acadiana Mall *
|
|
100
|
%
|
|
5.67
|
%
|
|
$
|
137,640
|
|
|
$
|
10,435
|
|
|
Apr-17
|
|
—
|
|
$
|
124,998
|
|
|
Open
|
|
|
Alamance Crossing
|
|
100
|
%
|
|
5.83
|
%
|
|
50,001
|
|
|
3,589
|
|
|
Jul-21
|
|
—
|
|
43,046
|
|
|
Jul-14
|
|
|
Alamance West
|
|
100
|
%
|
|
3.21
|
%
|
|
16,000
|
|
|
514
|
|
|
Dec-13
|
|
Dec-15
|
|
16,000
|
|
|
Open
|
(3)
|
|
Arbor Place
|
|
100
|
%
|
|
5.099
|
%
|
|
121,050
|
|
|
7,948
|
|
|
May-22
|
|
—
|
|
100,861
|
|
|
Apr-14
|
|
|
Asheville Mall
|
|
100
|
%
|
|
5.80
|
%
|
|
76,289
|
|
|
5,917
|
|
|
Sep-21
|
|
—
|
|
60,190
|
|
|
Sep-14
|
|
|
Brookfield Square
|
|
100
|
%
|
|
5.08
|
%
|
|
92,305
|
|
|
6,822
|
|
|
Nov-15
|
|
—
|
|
85,807
|
|
|
Open
|
|
|
Burnsville Center
|
|
100
|
%
|
|
6.00
|
%
|
|
79,272
|
|
|
6,417
|
|
|
Jul-20
|
|
—
|
|
63,589
|
|
|
Jul-13
|
|
|
Cary Towne Center
|
|
100
|
%
|
|
8.50
|
%
|
|
55,910
|
|
|
11,958
|
|
|
Mar-17
|
|
—
|
|
45,226
|
|
|
Open
|
|
|
Chapel Hill Mall *
|
|
100
|
%
|
|
6.10
|
%
|
|
70,045
|
|
|
5,599
|
|
|
Aug-16
|
|
—
|
|
64,747
|
|
|
Open
|
|
|
CherryVale Mall
|
|
100
|
%
|
|
5.00
|
%
|
|
82,347
|
|
|
6,055
|
|
|
Oct-15
|
|
—
|
|
76,647
|
|
|
Open
|
|
|
Chesterfield Mall *
|
|
100
|
%
|
|
5.74
|
%
|
|
140,000
|
|
|
8,036
|
|
|
Sep-16
|
|
—
|
|
140,000
|
|
|
Open
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Property
|
|
Our
Ownership
Interest
|
|
Stated
Interest
Rate
|
|
Principal
Balance as of
12/31/12
(1)
|
|
Annual
Debt
Service
|
|
Maturity
Date
|
|
Optional Extended Maturity Date
|
|
Balloon
Payment Due
on Maturity
|
|
Open to Prepayment
Date
(2)
|
|
|
Citadel Mall
|
|
100
|
%
|
|
5.68
|
%
|
|
68,835
|
|
|
5,226
|
|
|
Apr-17
|
|
—
|
|
62,525
|
|
|
Open
|
|
|
Columbia Place
|
|
100
|
%
|
|
5.45
|
%
|
|
27,266
|
|
|
2,493
|
|
|
Sep-13
|
|
—
|
|
26,583
|
|
|
Open
|
|
|
Cross Creek Mall
|
|
100
|
%
|
|
4.54
|
%
|
|
137,179
|
|
|
9,376
|
|
|
Jan-22
|
|
—
|
|
102,260
|
|
|
Open
|
|
|
Dakota Square Mall
|
|
100
|
%
|
|
6.23
|
%
|
|
58,522
|
|
|
4,562
|
|
|
Nov-16
|
|
—
|
|
54,843
|
|
|
Open
|
|
|
East Towne Mall
|
|
100
|
%
|
|
5.00
|
%
|
|
70,220
|
|
|
5,153
|
|
|
Nov-15
|
|
—
|
|
65,231
|
|
|
Open
|
|
|
EastGate Mall
|
|
100
|
%
|
|
5.83
|
%
|
|
42,281
|
|
|
3,613
|
|
|
Apr-21
|
|
—
|
|
30,104
|
|
|
Apr-14
|
|
|
Eastland Mall
|
|
100
|
%
|
|
5.85
|
%
|
|
59,400
|
|
|
3,475
|
|
|
Dec-15
|
|
—
|
|
59,400
|
|
|
Open
|
|
|
Fashion Square
|
|
100
|
%
|
|
4.95
|
%
|
|
41,569
|
|
|
2,932
|
|
|
Jun-22
|
|
—
|
|
31,112
|
|
|
May-14
|
|
|
Fayette Mall
|
|
100
|
%
|
|
5.42
|
%
|
|
179,227
|
|
|
13,527
|
|
|
May-21
|
|
—
|
|
139,177
|
|
|
May-13
|
|
|
Greenbrier Mall *
|
|
100
|
%
|
|
5.91
|
%
|
|
77,085
|
|
|
6,055
|
|
|
Aug-16
|
|
—
|
|
71,111
|
|
|
Open
|
|
|
Hamilton Place
|
|
90
|
%
|
|
5.86
|
%
|
|
106,024
|
|
|
8,292
|
|
|
Aug-16
|
|
—
|
|
97,757
|
|
|
Open
|
|
|
Hanes Mall
|
|
100
|
%
|
|
6.99
|
%
|
|
156,208
|
|
|
13,080
|
|
|
Oct-18
|
|
—
|
|
140,968
|
|
|
Open
|
|
|
Hickory Point Mall
|
|
100
|
%
|
|
5.85
|
%
|
|
29,635
|
|
|
2,347
|
|
|
Dec-15
|
|
—
|
|
27,690
|
|
|
Open
|
|
|
Honey Creek Mall
|
|
100
|
%
|
|
8.00
|
%
|
|
30,921
|
|
|
3,373
|
|
|
Jul-19
|
|
—
|
|
23,290
|
|
|
Open
|
(4)
|
|
Imperial Valley Mall
|
|
100
|
%
|
|
4.99
|
%
|
|
52,546
|
|
|
3,859
|
|
|
Sep-15
|
|
—
|
|
49,019
|
|
|
Open
|
|
|
Janesville Mall
|
|
100
|
%
|
|
8.38
|
%
|
|
5,269
|
|
|
1,857
|
|
|
Apr-16
|
|
—
|
|
—
|
|
|
Open
|
|
|
Jefferson Mall
|
|
100
|
%
|
|
4.75
|
%
|
|
70,676
|
|
|
4,456
|
|
|
Jun-22
|
|
—
|
|
58,176
|
|
|
May-14
|
|
|
Kirkwood Mall
|
|
49
|
%
|
|
5.75
|
%
|
|
40,368
|
|
|
2,885
|
|
|
Apr-18
|
|
|
|
37,109
|
|
|
Mar-13
|
|
|
Layton Hills Mall
|
|
100
|
%
|
|
5.66
|
%
|
|
98,369
|
|
|
7,453
|
|
|
Apr-17
|
|
—
|
|
89,327
|
|
|
Open
|
|
|
Mall del Norte
|
|
100
|
%
|
|
5.04
|
%
|
|
113,400
|
|
|
5,715
|
|
|
Dec-14
|
|
—
|
|
113,400
|
|
|
Open
|
|
|
Mid Rivers Mall *
|
|
100
|
%
|
|
5.88
|
%
|
|
89,312
|
|
|
7,029
|
|
|
May-21
|
|
—
|
|
70,214
|
|
|
May-14
|
|
|
Midland Mall
|
|
100
|
%
|
|
6.10
|
%
|
|
34,568
|
|
|
2,763
|
|
|
Aug-16
|
|
—
|
|
31,953
|
|
|
Open
|
|
|
Northpark Mall
|
|
100
|
%
|
|
5.75
|
%
|
|
33,809
|
|
|
3,171
|
|
|
Mar-14
|
|
—
|
|
32,370
|
|
|
Open
|
|
|
Northwoods Mall
|
|
100
|
%
|
|
5.075
|
%
|
|
72,339
|
|
|
4,743
|
|
|
Apr-22
|
|
—
|
|
60,292
|
|
|
May-14
|
|
|
Park Plaza Mall
|
|
100
|
%
|
|
5.28
|
%
|
|
96,059
|
|
|
7,165
|
|
|
Apr-21
|
|
—
|
|
74,428
|
|
|
Apr-14
|
|
|
Parkdale Mall & Crossing
|
|
100
|
%
|
|
5.85
|
%
|
|
91,906
|
|
|
7,241
|
|
|
Mar-21
|
|
—
|
|
72,447
|
|
|
Mar-14
|
|
|
Parkway Place
|
|
100
|
%
|
|
6.50
|
%
|
|
40,244
|
|
|
3,403
|
|
|
Jul-20
|
|
—
|
|
32,661
|
|
|
Jul-13
|
|
|
South County Center *
|
|
100
|
%
|
|
4.96
|
%
|
|
72,225
|
|
|
5,515
|
|
|
Oct-13
|
|
—
|
|
70,791
|
|
|
Open
|
|
|
Southpark Mall
|
|
100
|
%
|
|
4.845
|
%
|
|
66,525
|
|
|
4,240
|
|
|
Jun-22
|
|
—
|
|
54,924
|
|
|
Jul-14
|
|
|
St. Clair Square *
|
|
100
|
%
|
|
3.19
|
%
|
|
123,875
|
|
|
5,493
|
|
|
Dec-16
|
|
—
|
|
117,875
|
|
|
Dec-13
|
|
|
Stroud Mall
|
|
100
|
%
|
|
4.59
|
%
|
|
34,469
|
|
|
2,104
|
|
|
Apr-16
|
|
—
|
|
30,276
|
|
|
Open
|
(5)
|
|
The Forum at Grandview
|
|
100
|
%
|
|
3.21
|
%
|
|
10,200
|
|
|
327
|
|
|
Sep-13
|
|
Sep-14
|
|
10,200
|
|
|
Open
|
(3)
|
|
The Outlet Shoppes at El Paso
|
|
75
|
%
|
|
7.06
|
%
|
|
66,367
|
|
|
5,622
|
|
|
Dec-17
|
|
—
|
|
61,265
|
|
|
Open
|
|
|
The Outlet Shoppes
at Gettysburg
|
|
50
|
%
|
|
5.87
|
%
|
|
40,170
|
|
|
3,104
|
|
|
Feb-16
|
|
—
|
|
37,766
|
|
|
Open
|
|
|
The Outlet Shoppes at Oklahoma City
|
|
75
|
%
|
|
5.73
|
%
|
|
58,888
|
|
|
4,521
|
|
|
Jan-22
|
|
—
|
|
45,428
|
|
|
Jan-13
|
|
|
Valley View Mall
|
|
100
|
%
|
|
6.50
|
%
|
|
62,282
|
|
|
5,267
|
|
|
Jul-20
|
|
—
|
|
50,547
|
|
|
Jul-13
|
|
|
Volusia Mall
|
|
100
|
%
|
|
8.00
|
%
|
|
53,191
|
|
|
5,802
|
|
|
Jul-19
|
|
—
|
|
40,064
|
|
|
Open
|
(4)
|
|
Wausau Center
|
|
100
|
%
|
|
5.85
|
%
|
|
19,187
|
|
|
1,509
|
|
|
Apr-21
|
|
—
|
|
15,100
|
|
|
Apr-14
|
|
|
West Towne Mall
|
|
100
|
%
|
|
5.00
|
%
|
|
99,186
|
|
|
7,279
|
|
|
Nov-15
|
|
—
|
|
92,139
|
|
|
Open
|
|
|
WestGate Mall
|
|
100
|
%
|
|
4.99
|
%
|
|
39,661
|
|
|
2,803
|
|
|
Jul-22
|
|
—
|
|
29,670
|
|
|
Open
|
|
|
Westmoreland Mall *
|
|
100
|
%
|
|
5.05
|
%
|
|
63,639
|
|
|
5,993
|
|
|
Mar-13
|
|
—
|
|
63,175
|
|
|
Open
|
(9)
|
|
York Galleria
|
|
100
|
%
|
|
4.55
|
%
|
|
55,057
|
|
|
3,369
|
|
|
Apr-16
|
|
—
|
|
48,337
|
|
|
Open
|
(6)
|
|
|
|
|
|
|
|
|
|
3,709,018
|
|
|
281,482
|
|
|
|
|
|
|
3,242,115
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Associated Centers:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CoolSprings Crossing
|
|
100
|
%
|
|
4.54
|
%
|
|
12,887
|
|
|
789
|
|
|
Apr-16
|
|
—
|
|
11,313
|
|
|
Open
|
(7)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Property
|
|
Our
Ownership
Interest
|
|
Stated
Interest
Rate
|
|
Principal
Balance as of
12/31/12
(1)
|
|
Annual
Debt
Service
|
|
Maturity
Date
|
|
Optional Extended Maturity Date
|
|
Balloon
Payment Due
on Maturity
|
|
Open to Prepayment
Date
(2)
|
|
|
EastGate Crossing
|
|
100
|
%
|
|
5.66
|
%
|
|
15,324
|
|
|
1,159
|
|
|
May-17
|
|
—
|
|
13,893
|
|
|
Open
|
|
|
Gunbarrel Pointe
|
|
100
|
%
|
|
4.64
|
%
|
|
11,472
|
|
|
698
|
|
|
Apr-16
|
|
—
|
|
10,083
|
|
|
Open
|
(8)
|
|
Hamilton Corner
|
|
90
|
%
|
|
5.67
|
%
|
|
15,595
|
|
|
1,183
|
|
|
Apr-17
|
|
—
|
|
14,164
|
|
|
Open
|
|
|
Hamilton Crossing & Expansion
|
|
92
|
%
|
|
5.99
|
%
|
|
10,283
|
|
|
819
|
|
|
Apr-21
|
|
—
|
|
8,122
|
|
|
|
|
|
The Plaza at Fayette
|
|
100
|
%
|
|
5.67
|
%
|
|
40,633
|
|
|
3,081
|
|
|
Apr-17
|
|
—
|
|
36,901
|
|
|
Open
|
|
|
The Shoppes at St. Clair Square *
|
|
100
|
%
|
|
5.67
|
%
|
|
20,593
|
|
|
1,562
|
|
|
Apr-17
|
|
—
|
|
18,702
|
|
|
Open
|
|
|
The Terrace
|
|
92
|
%
|
|
7.25
|
%
|
|
14,224
|
|
|
1,284
|
|
|
Jun-20
|
|
—
|
|
11,755
|
|
|
Jul-15
|
|
|
|
|
|
|
|
|
|
|
141,011
|
|
|
10,575
|
|
|
|
|
|
|
124,933
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Community Centers:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Southaven Towne Center
|
|
100
|
%
|
|
5.50
|
%
|
|
41,786
|
|
|
3,134
|
|
|
Jan-17
|
|
—
|
|
38,056
|
|
|
Open
|
|
|
Statesboro Crossing
|
|
50
|
%
|
|
1.21
|
%
|
|
13,482
|
|
|
300
|
|
|
Feb-13
|
|
—
|
|
13,482
|
|
|
Open
|
(3)
|
(9)
|
The Promenade
|
|
85
|
%
|
|
1.91
|
%
|
|
58,000
|
|
|
1,111
|
|
|
Dec-14
|
|
Dec-18
|
|
58,000
|
|
|
Open
|
(3)
|
|
|
|
|
|
|
|
|
|
113,268
|
|
|
4,545
|
|
|
|
|
|
|
109,538
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Office Buildings:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CBL Center
|
|
92
|
%
|
|
5.00
|
%
|
|
21,675
|
|
|
1,651
|
|
|
Jun-22
|
|
—
|
|
14,949
|
|
|
Jul-14
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Credit Facilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Secured Credit Facility - $105,000 capacity
|
|
100
|
%
|
|
2.46
|
%
|
|
10,625
|
|
|
262
|
|
|
Jun-15
|
|
Jun-16
|
|
10,625
|
|
|
Open
|
|
|
Unsecured Credit Facility - $600,000 capacity
|
|
100
|
%
|
|
2.07
|
%
|
|
300,297
|
|
|
6,216
|
|
|
Nov-15
|
|
Nov-16
|
|
300,297
|
|
|
Open
|
|
|
Unsecured Credit Facility - $600,000 capacity
|
|
100
|
%
|
|
2.07
|
%
|
|
175,329
|
|
|
3,629
|
|
|
Nov-16
|
|
Nov-17
|
|
175,329
|
|
|
Open
|
|
|
Unsecured term facility - General
|
|
100
|
%
|
|
1.82
|
%
|
|
228,000
|
|
|
4,150
|
|
|
Apr-13
|
|
—
|
|
228,000
|
|
|
Open
|
|
|
|
|
|
|
|
|
|
|
714,251
|
|
|
14,257
|
|
|
|
|
|
|
714,251
|
|
|
|
|
|
Construction Properties:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The Outlet Shoppes
at Atlanta
|
|
75
|
%
|
|
2.96
|
%
|
|
15,366
|
|
|
455
|
|
|
Aug-15
|
|
Aug-17
|
|
15,366
|
|
|
Open
|
(3)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Pearland Town Center
|
|
88
|
%
|
|
8.00
|
%
|
|
18,264
|
|
|
1,461
|
|
|
Oct-14
|
|
|
|
N/A
|
|
|
(10)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Unamortized Premiums (Discounts)
|
|
|
|
|
12,830
|
|
|
—
|
|
|
|
|
|
|
—
|
|
|
|
(11)
|
|
Total Consolidated Debt
|
|
|
|
|
$
|
4,745,683
|
|
|
$
|
314,426
|
|
|
|
|
|
|
$
|
4,221,152
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Unconsolidated Debt:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Bank of America Building
|
|
50
|
%
|
|
5.33
|
%
|
|
$
|
9,250
|
|
|
$
|
493
|
|
|
Apr-13
|
|
—
|
|
$
|
9,250
|
|
|
Open
|
|
|
Coastal Grand-Myrtle Beach
|
|
50
|
%
|
|
5.09
|
%
|
|
79,920
|
|
|
7,078
|
|
|
Oct-14
|
|
—
|
|
74,423
|
|
|
Open
|
(12)
|
|
CoolSprings Galleria
|
|
50
|
%
|
|
6.98
|
%
|
|
109,395
|
|
|
10,683
|
|
|
Jun-18
|
|
—
|
|
87,037
|
|
|
Jun-13
|
|
|
First Citizens Bank Building
|
|
50
|
%
|
|
5.33
|
%
|
|
5,110
|
|
|
272
|
|
|
Apr-13
|
|
—
|
|
5,110
|
|
|
Open
|
|
|
First National Bank Building
|
|
50
|
%
|
|
5.33
|
%
|
|
809
|
|
|
43
|
|
|
Apr-13
|
|
—
|
|
809
|
|
|
Open
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Property
|
|
Our
Ownership
Interest
|
|
Stated
Interest
Rate
|
|
Principal
Balance as of
12/31/12
(1)
|
|
Annual
Debt
Service
|
|
Maturity
Date
|
|
Optional Extended Maturity Date
|
|
Balloon
Payment Due
on Maturity
|
|
Open to Prepayment
Date
(2)
|
|
|
Friendly Center Office Building
|
|
50
|
%
|
|
5.33
|
%
|
|
2,199
|
|
|
117
|
|
|
Apr-13
|
|
—
|
|
2,199
|
|
|
Open
|
|
|
Friendly Shopping Center
|
|
50
|
%
|
|
5.33
|
%
|
|
77,625
|
|
|
4,137
|
|
|
Apr-13
|
|
—
|
|
77,625
|
|
|
Open
|
|
|
Governor's Square Mall
|
|
48
|
%
|
|
8.23
|
%
|
|
21,400
|
|
|
3,476
|
|
|
Sep-16
|
|
—
|
|
14,089
|
|
|
Open
|
|
|
Green Valley Office Building
|
|
50
|
%
|
|
5.33
|
%
|
|
1,941
|
|
|
103
|
|
|
Apr-13
|
|
—
|
|
1,941
|
|
|
Open
|
|
|
Gulf Coast Town Center (Phase I)
|
|
50
|
%
|
|
5.60
|
%
|
|
190,800
|
|
|
10,687
|
|
|
Jul-17
|
|
—
|
|
190,800
|
|
|
Open
|
|
|
Gulf Coast Town Center (Phase III)
|
|
50
|
%
|
|
2.75
|
%
|
|
6,786
|
|
|
528
|
|
|
Jul-15
|
|
—
|
|
5,401
|
|
|
Open
|
(3)
|
(13)
|
Hammock Landing (Phase I)
|
|
50
|
%
|
|
3.71
|
%
|
|
42,431
|
|
|
2,191
|
|
|
Nov-13
|
|
Nov-14
|
|
41,815
|
|
|
Open
|
(3)
|
(13)
|
Hammock Landing (Phase II)
|
|
50
|
%
|
|
3.71
|
%
|
|
2,921
|
|
|
431
|
|
|
Nov-13
|
|
—
|
|
2,621
|
|
|
Open
|
(3)
|
(13)
|
High Pointe Commons (Phase I)
|
|
50
|
%
|
|
5.74
|
%
|
|
13,893
|
|
|
1,212
|
|
|
May-17
|
|
—
|
|
12,069
|
|
|
Open
|
|
|
High Pointe Commons (Phase II)
|
|
50
|
%
|
|
6.10
|
%
|
|
5,552
|
|
|
481
|
|
|
Jul-17
|
|
—
|
|
4,816
|
|
|
Open
|
|
|
Kentucky Oaks Mall
|
|
50
|
%
|
|
5.27
|
%
|
|
24,263
|
|
|
2,429
|
|
|
Jan-17
|
|
—
|
|
19,223
|
|
|
Open
|
|
|
Oak Park Mall
|
|
50
|
%
|
|
5.85
|
%
|
|
275,700
|
|
|
16,128
|
|
|
Dec-15
|
|
—
|
|
275,700
|
|
|
Open
|
|
|
Renaissance Center (Phase I)
|
|
50
|
%
|
|
5.61
|
%
|
|
33,793
|
|
|
2,569
|
|
|
Jul-16
|
|
—
|
|
31,297
|
|
|
Open
|
|
|
Renaissance Center (Phase II)
|
|
50
|
%
|
|
5.22
|
%
|
|
15,700
|
|
|
820
|
|
|
Apr-13
|
|
—
|
|
15,700
|
|
|
Open
|
|
|
Summit Fair
|
|
27
|
%
|
|
5.00
|
%
|
|
49,345
|
|
|
2,467
|
|
|
Dec-12
|
|
—
|
|
49,266
|
|
|
Open
|
(3)
|
(14)
|
The Pavilion at Port Orange
|
|
50
|
%
|
|
3.71
|
%
|
|
63,030
|
|
|
2,338
|
|
|
Mar-14
|
|
Mar-15
|
|
61,998
|
|
|
Open
|
(3)
|
(13)
|
The Shops at Friendly Center
|
|
50
|
%
|
|
5.90
|
%
|
|
41,131
|
|
|
3,203
|
|
|
Jan-17
|
|
—
|
|
37,639
|
|
|
Open
|
|
|
Triangle Town Center
|
|
50
|
%
|
|
5.74
|
%
|
|
183,291
|
|
|
14,367
|
|
|
Dec-15
|
|
—
|
|
171,092
|
|
|
Open
|
|
|
Wachovia Office Building
|
|
50
|
%
|
|
5.33
|
%
|
|
3,066
|
|
|
163
|
|
|
Apr-13
|
|
—
|
|
3,066
|
|
|
Open
|
|
|
West County Center
|
|
50
|
%
|
|
3.40
|
%
|
|
190,000
|
|
|
6,496
|
|
|
Dec-22
|
|
—
|
|
162,270
|
|
|
Jan-15
|
(15)
|
|
York Town Center
|
|
50
|
%
|
|
4.90
|
%
|
|
37,356
|
|
|
2,657
|
|
|
Feb-22
|
|
—
|
|
28,293
|
|
|
Open
|
|
|
Total Unconsolidated Debt
|
|
|
|
|
$
|
1,486,707
|
|
|
$
|
95,569
|
|
|
|
|
|
|
$
|
1,385,549
|
|
|
|
|
|
Total Consolidated and Unconsolidated Debt
|
|
$
|
6,232,390
|
|
|
$
|
409,995
|
|
|
|
|
|
|
$
|
5,606,701
|
|
|
|
|
|
Company's Pro-Rata Share of Total Debt
|
|
$
|
5,445,207
|
|
|
$
|
354,767
|
|
|
|
|
|
|
|
|
|
|
(16)
|
|
|
|
*
|
Properties owned in a Joint Venture of which common stock is owned 100% by CBL.
|
|
|
(1)
|
The amount listed includes 100% of the loan amount even though the Company may have less than a 100% ownership interest in the Property.
|
|
|
(2)
|
Prepayment premium is based on yield maintenance or defeasance.
|
|
|
(3)
|
The interest rate is variable at various spreads over LIBOR priced at the rates in effect at December 31, 2012. The note is prepayable at any time without prepayment penalty.
|
|
|
(4)
|
The mortgages on Honey Creek and Volusia Mall are cross-collateralized and cross-defaulted.
|
|
|
(5)
|
The Company has an interest rate swap on a notional amount of $34,469, amortizing to $30,276 over the term of the swap, related to Stroud Mall to effectively fix the interest rate on that variable-rate loan. Therefore, this amount is currently reflected as having a fixed rate. The swap terminates in April 2016.
|
|
|
(6)
|
The Company has an interest rate swap on a notional amount of $55,057, amortizing to $48,337 over the term of the swap, related to York Galleria Mall to effectively fix the interest rate on that variable-rate loan. Therefore, this amount is currently reflected as having a fixed rate. The swap terminates in April 2016.
|
|
|
(7)
|
The Company has an interest rate swap on a notional amount of $12,887, amortizing to $11,313 over the term of the swap, related to CoolSprings Crossing to effectively fix the interest rate on that variable-rate loan. Therefore, this amount is currently reflected as having a fixed rate. The swap terminates in April 2016.
|
|
|
(8)
|
The Company has an interest rate swap on a notional amount of $11,472, amortizing to $10,083 over the term of the swap, related to Gunbarrel Pointe to effectively fix the interest rate on that variable-rate loan. Therefore, this amount is currently reflected as having a fixed rate. The swap terminates in April 2016.
|
|
|
(9)
|
This loan was retired subsequent to December 31, 2012.
|
|
|
(10)
|
We own 88% and our joint venture partner owns 12%. of Pearland Town Center. Our joint venture partner's equity contribution is accounted for using the financing method. The 8.0% rate represents our partner's rate of preferred return.
|
|
|
(11)
|
Represents net premiums related to debt assumed to acquire real estate assets, which had stated interest rates that were above or below the estimated market rates for similar debt instruments at the respective acquisition dates.
|
|
|
(12)
|
The amounts shown represent a first mortgage securing the Property. In addition to the outstanding balance of the first mortgage shown above, there is also a total of $18,000 of B-notes that are payable to the Company and its joint venture partner, each of which hold $9,000 for Coastal Grand - Myrtle Beach.
|
|
|
(13)
|
The Company owns less than 100% of the property but guarantees 100% of the debt.
|
|
|
(14)
|
The Company has guaranteed 27%, up to a maximum of
$15,183
, of the outstanding balance of this construction financing.
|
|
|
(15)
|
Annual debt service is interest only through December 2015. In 2016 and thereafter, annual debt service will be $10,111.
|
|
|
(16)
|
Represents the Company's pro rata share of debt, including our share of unconsolidated affiliates' debt and excluding noncontrolling interests' share of consolidated debt on shopping center properties.
|
The following is a reconciliation of consolidated debt to the Company's pro rata share of total debt:
|
|
|
|
|
Total consolidated debt
|
$
|
4,745,683
|
|
Noncontrolling interests' share of consolidated debt
|
(89,530
|
)
|
Company's share of unconsolidated debt
|
789,054
|
|
Company's pro rata share of total debt
|
$
|
5,445,207
|
|
The following Properties have been pledged as collateral for our secured line of credit:
|
|
|
|
Property
|
|
Location
|
Cobblestone Village at Palm Coast
|
|
Palm Coast, FL
|
College Square
|
|
Morristown, TN
|
The Lakes Mall
|
|
Muskegon, MI
|
Mall del Norte
(1)
|
|
Laredo, TX
|
The Shoppes at Hamilton Place
|
|
Chattanooga, TN
|
Walnut Square
|
|
Dalton, GA
|
|
|
|
(1) Only certain parcels at this Property have been pledged as collateral.
|
Other than our property-specific mortgage or construction loans and secured line of credit, there are no material liens or encumbrances on our Properties.
ITEM 3. LEGAL PROCEEDINGS
On March 11, 2010, The Promenade D'Iberville, LLC (“TPD”), a subsidiary of the Company, filed a lawsuit in the Circuit Court of Harrison County, Mississippi, against M. Hanna Construction Co., Inc. (“M Hanna”), Gallet & Associates, Inc., LA Ash, Inc., EMJ Corporation (“EMJ”) and JEA (f/k/a Jacksonville Electric Authority), seeking damages for alleged property damage and related damages occurring at a shopping center development in D'Iberville, Mississippi. EMJ filed an answer and counterclaim denying liability and seeking to recover from TPD the retainage of approximately
$0.3 million
allegedly owed under the construction contract. Kohl's Department Stores, Inc. (“Kohl's”) was granted permission to intervene in the lawsuit and, on April 13, 2011, filed a cross-claim against TPD alleging that TPD is liable to Kohl's for unspecified damages resulting from the actions of the defendants and for the failure to perform the obligations of TPD under a Site Development Agreement with Kohl's. Kohl's also made a claim against the Company, which guaranteed the performance of TPD under the Site Development Agreement. The case is at the discovery stage.
TPD also has filed claims under several insurance policies in connection with this matter, and there are three pending lawsuits relating to insurance coverage. On October 8, 2010, First Mercury Insurance Company (“First Mercury”) filed an action in the United States District Court for the Eastern District of Texas against M Hanna and TPD seeking a declaratory judgment concerning coverage under a liability insurance policy issued by First Mercury to M Hanna. That case was dismissed for lack of federal jurisdiction and refiled in Texas state court. On June 13, 2011, TPD filed an action in the Chancery Court of Hamilton County, Tennessee against National Union Fire Insurance Company of Pittsburgh, PA (“National Union”) and EMJ seeking a declaratory judgment regarding coverage under a liability insurance policy issued by National Union to EMJ and recovery of damages arising out of National Union's breach of its obligations. In March 2012, Zurich American and Zurich American of Illinois, which also have issued liability insurance policies to EMJ, intervened in that case and the case is set for trial on October 29, 2013. On February 14, 2012, TPD filed claims in the United States District Court for the Southern District of Mississippi against Factory Mutual Insurance Company and Federal Insurance Company
seeking a declaratory judgment concerning coverage under certain builders risk and property insurance policies issued by those respective insurers to the Company.
Certain executive officers of the Company and members of the immediate family of Charles B. Lebovitz, Chairman of the Board of the Company, collectively have a significant non-controlling interest in EMJ, a major national construction company that the Company engaged to build a substantial number of the Company's properties. EMJ is one of the defendants in the Harrison County, MS and Hamilton County, TN cases described above.
We are currently involved in certain other litigation that arises in the ordinary course of our business. We believe that the pending litigation will not materially affect our financial position or results of operations.
ITEM 4. MINE SAFETY DISCLOSURES
Not applicable.
PART II
ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES
Common stock of CBL & Associates Properties, Inc. is traded on the New York Stock Exchange. The stock symbol is “CBL”. Quarterly sale prices and dividends paid per share of common stock are as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Market Price
|
|
|
Quarter Ended
|
|
High
|
|
Low
|
|
Dividend
|
2012
|
|
|
|
|
|
|
March 31
|
|
$
|
19.50
|
|
|
$
|
15.41
|
|
|
$
|
0.22
|
|
June 30
|
|
$
|
19.57
|
|
|
$
|
16.65
|
|
|
$
|
0.22
|
|
September 30
|
|
$
|
22.55
|
|
|
$
|
18.64
|
|
|
$
|
0.22
|
|
December 31
|
|
$
|
23.00
|
|
|
$
|
20.60
|
|
|
$
|
0.22
|
|
|
|
|
|
|
|
|
2011
|
|
|
|
|
|
|
|
|
|
March 31
|
|
$
|
18.72
|
|
|
$
|
16.59
|
|
|
$
|
0.21
|
|
June 30
|
|
$
|
19.35
|
|
|
$
|
16.66
|
|
|
$
|
0.21
|
|
September 30
|
|
$
|
19.33
|
|
|
$
|
11.36
|
|
|
$
|
0.21
|
|
December 31
|
|
$
|
16.16
|
|
|
$
|
10.41
|
|
|
$
|
0.21
|
|
There were approximately 810 shareholders of record for our common stock as of
February 28, 2013
.
Future dividend distributions are subject to our actual results of operations, taxable income, economic conditions, issuances of common stock and such other factors as our Board of Directors deems relevant. Our actual results of operations will be affected by a number of factors, including the revenues received from the Properties, our operating expenses, interest expense, unanticipated capital expenditures and the ability of the anchors and tenants at the Properties to meet their obligations for payment of rents and tenant reimbursements.
See
Part III, Item 12
contained herein for information regarding securities authorized for issuance under equity compensation plans.
During the fourth quarter of 2012, subsequent to the unregistered issuances of common stock reflected in our Current Report on Form 8-K dated October 11, 2012, our Board of Directors approved the issuance, pursuant to the terms of the Operating Partnership's Fourth Amended and Restated Agreement of Limited Partnership (the “Partnership Agreement”), of 243,458 additional shares of common stock in response to exchange notices received from four limited partners covering a like number of common units of limited partnership in the Operating Partnership. These shares were issued to the following limited partners in the amounts indicated below, effective December 14, 2012, pursuant to our right to deliver either shares of common stock, or their cash equivalent (as determined pursuant to the Partnership Agreement), to complete such exchanges:
|
|
|
|
Exchanging Partner
Receiving Common Stock
|
|
Shares of
Common Stock Issued
|
John Anderson Revocable Trust Under Agreement dated September 21 1977, John R. Anderson, Trustee
|
|
33,068
|
Community Foundation of Greater Chattanooga, Inc.
|
|
67,205
|
Kahn Joint Venture
|
|
132,155
|
Powell Family Trust dated April 6, 2001, Frederick H. Powell, Jr., Successor Trustee
|
|
11,030
|
|
|
243,458
|
We believe each of these share issuances was exempt from the registration requirements of the Securities Act of 1933 pursuant to Section 4(2) thereof, because they did not involve a public offering or sale. No underwriters, brokers or finders were involved in any of these transactions.
The following table presents information with respect to repurchases of common stock made by us during the three months ended
December 31, 2012
:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Period
|
|
Total Number
of Shares
Purchased (1)
|
|
Average
Price Paid
per Share (2)
|
|
Total Number of
Shares Purchased
as Part of a
Publicly
Announced Plan
|
|
Approximate
Dollar Value of
Shares that May
Yet Be Purchased
Under the Plan
|
Oct. 1–31, 2012
|
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
—
|
|
Nov. 1–30, 2012
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Dec. 1–31, 2012
|
|
17,823
|
|
|
22.14
|
|
|
—
|
|
|
—
|
|
Total
|
|
17,823
|
|
|
$
|
22.14
|
|
|
—
|
|
|
$
|
—
|
|
|
|
(1)
|
Represents shares surrendered to the Company by employees to satisfy federal and state income tax withholding requirements related to the vesting of shares of restricted stock issued under the CBL & Associates Properties, Inc. Second Amended and Restated Stock Incentive Plan, as amended.
|
|
|
(2)
|
Represents the market value of the common stock on the vesting date for the shares of restricted stock, which was used to determine the number of shares required to be surrendered to satisfy income tax withholding requirements.
|
ITEM 6. SELECTED FINANCIAL DATA
(In thousands, except per share data)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year Ended December 31,
(1)
|
|
2012
|
|
2011
|
|
2010
|
|
2009
|
|
2008
|
Total revenues
|
$
|
1,034,640
|
|
|
$
|
1,051,314
|
|
|
$
|
1,045,703
|
|
|
$
|
1,052,966
|
|
|
$
|
1,099,856
|
|
Total operating expenses
|
655,471
|
|
|
692,595
|
|
|
644,185
|
|
|
661,489
|
|
|
725,618
|
|
Income from operations
|
379,169
|
|
|
358,719
|
|
|
401,518
|
|
|
391,477
|
|
|
374,238
|
|
Interest and other income
|
3,955
|
|
|
2,583
|
|
|
3,868
|
|
|
5,200
|
|
|
10,000
|
|
Interest expense
|
(244,432
|
)
|
|
(267,072
|
)
|
|
(281,102
|
)
|
|
(286,242
|
)
|
|
(301,522
|
)
|
Gain (loss) on extinguishment of debt
|
265
|
|
|
1,029
|
|
|
—
|
|
|
(601
|
)
|
|
—
|
|
Gain (loss) on investments
|
45,072
|
|
|
—
|
|
|
888
|
|
|
(9,260
|
)
|
|
(17,181
|
)
|
Gain on sales of real estate assets
|
2,286
|
|
|
59,396
|
|
|
2,887
|
|
|
3,820
|
|
|
10,866
|
|
Equity in earnings (losses) of unconsolidated affiliates
|
8,313
|
|
|
6,138
|
|
|
(188
|
)
|
|
5,489
|
|
|
2,831
|
|
Income tax benefit (provision)
|
(1,404
|
)
|
|
269
|
|
|
6,417
|
|
|
1,222
|
|
|
(13,495
|
)
|
Income from continuing operations
|
193,224
|
|
|
161,062
|
|
|
134,288
|
|
|
111,105
|
|
|
65,737
|
|
Discontinued operations
|
(18,705
|
)
|
|
23,932
|
|
|
(36,119
|
)
|
|
(118,170
|
)
|
|
(2,325
|
)
|
Net income (loss)
|
174,519
|
|
|
184,994
|
|
|
98,169
|
|
|
(7,065
|
)
|
|
63,412
|
|
Net (income) loss attributable to noncontrolling interests in:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating partnership
|
(19,267
|
)
|
|
(25,841
|
)
|
|
(11,018
|
)
|
|
17,845
|
|
|
(7,495
|
)
|
Other consolidated subsidiaries
|
(23,652
|
)
|
|
(25,217
|
)
|
|
(25,001
|
)
|
|
(25,769
|
)
|
|
(24,330
|
)
|
Net income (loss) attributable to the Company
|
131,600
|
|
|
133,936
|
|
|
62,150
|
|
|
(14,989
|
)
|
|
31,587
|
|
Preferred dividends
|
(47,511
|
)
|
|
(42,376
|
)
|
|
(32,619
|
)
|
|
(21,818
|
)
|
|
(21,819
|
)
|
Net income (loss) available to common shareholders
|
$
|
84,089
|
|
|
$
|
91,560
|
|
|
$
|
29,531
|
|
|
$
|
(36,807
|
)
|
|
$
|
9,768
|
|
Basic per share data attributable to common shareholders:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income from continuing operations, net of preferred dividends
|
$
|
0.64
|
|
|
$
|
0.49
|
|
|
$
|
0.40
|
|
|
$
|
0.40
|
|
|
$
|
0.17
|
|
Net income (loss) attributable to common shareholders
|
$
|
0.54
|
|
|
$
|
0.62
|
|
|
$
|
0.21
|
|
|
$
|
(0.35
|
)
|
|
$
|
0.15
|
|
Weighted average shares outstanding
|
154,762
|
|
|
148,289
|
|
|
138,375
|
|
|
106,366
|
|
|
66,313
|
|
Diluted per share data attributable to common shareholders:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income from continuing operations, net of preferred dividends
|
$
|
0.64
|
|
|
$
|
0.49
|
|
|
$
|
0.40
|
|
|
$
|
0.40
|
|
|
$
|
0.17
|
|
Net income (loss) attributable to common shareholders
|
$
|
0.54
|
|
|
$
|
0.62
|
|
|
$
|
0.21
|
|
|
$
|
(0.35
|
)
|
|
$
|
0.15
|
|
Weighted average common and potential dilutive common shares outstanding
|
154,807
|
|
|
148,334
|
|
|
138,416
|
|
|
106,366
|
|
|
66,418
|
|
Amounts attributable to common shareholders:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income from continuing operations, net of preferred dividends
|
$
|
99,307
|
|
|
$
|
72,914
|
|
|
$
|
55,836
|
|
|
$
|
42,779
|
|
|
$
|
11,084
|
|
Discontinued operations
|
(15,218
|
)
|
|
18,646
|
|
|
(26,304
|
)
|
|
(79,586
|
)
|
|
(1,316
|
)
|
Net income (loss) attributable to common shareholders
|
$
|
84,089
|
|
|
$
|
91,560
|
|
|
$
|
29,532
|
|
|
$
|
(36,807
|
)
|
|
$
|
9,768
|
|
Dividends declared per common share
|
$
|
0.88
|
|
|
$
|
0.84
|
|
|
$
|
0.80
|
|
|
$
|
0.58
|
|
|
$
|
2.01
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31,
|
|
2012
|
|
2011
|
|
2010
|
|
2009
|
|
2008
|
BALANCE SHEET DATA:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net investment in real estate assets
|
$
|
6,328,982
|
|
|
$
|
6,005,670
|
|
|
$
|
6,890,137
|
|
|
$
|
7,095,035
|
|
|
$
|
7,321,480
|
|
Total assets
|
7,089,736
|
|
|
6,719,428
|
|
|
7,506,554
|
|
|
7,729,110
|
|
|
8,034,335
|
|
Total mortgage and other indebtedness
|
4,745,683
|
|
|
4,489,355
|
|
|
5,209,747
|
|
|
5,616,139
|
|
|
6,095,676
|
|
Redeemable noncontrolling interests
|
464,082
|
|
|
456,105
|
|
|
458,213
|
|
|
444,259
|
|
|
439,672
|
|
Shareholders’ equity:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Redeemable preferred stock
|
25
|
|
|
23
|
|
|
12
|
|
|
12
|
|
|
12
|
|
Other shareholders’ equity
|
1,328,668
|
|
|
1,263,255
|
|
|
1,300,326
|
|
|
1,117,884
|
|
|
788,512
|
|
Total shareholders’ equity
|
1,328,693
|
|
|
1,263,278
|
|
|
1,300,338
|
|
|
1,117,896
|
|
|
788,524
|
|
Noncontrolling interests
|
192,404
|
|
|
207,113
|
|
|
223,605
|
|
|
302,483
|
|
|
380,472
|
|
Total equity
|
$
|
1,521,097
|
|
|
$
|
1,470,391
|
|
|
$
|
1,523,943
|
|
|
$
|
1,420,379
|
|
|
$
|
1,168,996
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year Ended December 31,
|
|
2012
|
|
2011
|
|
2010
|
|
2009
|
|
2008
|
OTHER DATA:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash flows provided by (used in):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating activities
|
$
|
481,515
|
|
|
$
|
441,836
|
|
|
$
|
429,792
|
|
|
$
|
431,638
|
|
|
$
|
419,093
|
|
Investing activities
|
(246,670
|
)
|
|
(27,645
|
)
|
|
(5,558
|
)
|
|
(160,302
|
)
|
|
(360,601
|
)
|
Financing activities
|
(212,689
|
)
|
|
(408,995
|
)
|
|
(421,400
|
)
|
|
(275,834
|
)
|
|
(71,512
|
)
|
|
|
|
|
|
|
|
|
|
|
Funds From Operations ("FFO") of the Operating Partnership
(2)
|
458,159
|
|
|
422,697
|
|
|
394,841
|
|
|
397,068
|
|
|
376,273
|
|
FFO allocable to Company shareholders
|
372,758
|
|
|
329,323
|
|
|
287,563
|
|
|
267,425
|
|
|
213,347
|
|
|
|
(1)
|
Please refer to
Notes 3
,
5
and
15
to the consolidated financial statements for a description of acquisitions, joint venture transactions and impairment charges that have impacted the comparability of the financial information presented. Also, please refer to
Note 4
to the consolidated financial statements for a description of discontinued operations that resulted in revisions to certain amounts previously reported.
|
|
|
(2)
|
Please refer to Management’s Discussion and Analysis of Financial Condition and Results of Operations for the definition of FFO, which does not represent cash flows from operations as defined by accounting principles generally accepted in the United States and is not necessarily indicative of the cash available to fund all cash requirements. A reconciliation of FFO to net income (loss) attributable to common shareholders is presented o
n page 71.
|
ITEM 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations
The following discussion and analysis of financial condition and results of operations should be read in conjunction with the consolidated financial statements and accompanying notes that are included in this annual report. Capitalized terms used, but not defined, in this Management’s Discussion and Analysis of Financial Condition and Results of Operations have the same meanings as defined in the notes to the consolidated financial statements.
Executive Overview
We are a self-managed, self-administered, fully integrated REIT that is engaged in the ownership, development, acquisition, leasing, management and operation of regional shopping malls, open-air centers, associated centers, community centers and office properties. Our shopping centers are located in
27
states, but are primarily in the southeastern and midwestern United States. We have elected to be taxed as a REIT for federal income tax purposes.
As of
December 31, 2012
, we owned controlling interests in
77
regional malls/open-air and outlet centers (including one mixed-use center),
28
associated centers (each located adjacent to a regional shopping mall),
six
community centers and
13
office buildings, including our corporate office building. We consolidate the financial statements of all entities in which we have a controlling financial interest or where we are the primary beneficiary of a variable interest entity. As of
December 31, 2012
, we owned non-controlling interests in
nine
regional malls,
four
associated centers,
four
community centers and
seven
office buildings. Because one or more of the other partners have substantive participating rights, we do not control these partnerships and joint ventures and, accordingly, account for these investments using the equity method. We had controlling interests in the development of
one
outlet center, owned in a
75%
/
25%
joint venture at
December 31, 2012
,
one
community center development,
one
mall expansion and
two
mall redevelopments under construction at
December 31, 2012
. We also hold options to acquire certain development properties owned by third parties.
Operationally, we continue to pursue strategic acquisitions, prune non-core and mature assets, and invest in our Properties through development and expansion initiatives. Occupancy increased 100 basis points in 2012 to 94.6% across our total portfolio as compared to the prior year and we signed more than 6.1 million square feet of leases. Same-store sales per square foot excluding license agreements, for stabilized mall tenants 10,000 square feet or less for 2012 increased 3.2% over the prior year to $353 per square foot. See "Mall Store Sales" section included herein for further information about our same-store sales metrics. Occupancy gains, sales increases and positive leasing spreads contributed to positive growth in our same-center NOI.
Our financing strategy centers on positioning our balance sheet to achieve an investment grade rating, which should provide us with increased flexibility and access to favorable financing options in the public debt markets. As part of this process, we extended and modified our two largest credit facilities to convert them from secured to unsecured and increase their aggregate capacity to $1.2 billion. Additionally, we are retiring property-specific loans as they mature to increase the size of our unencumbered NOI and gross asset value. We believe the process to achieve an investment grade rating could take up to two years.
FFO of our Operating Partnership, as adjusted, increased 5.8% to
$412.8 million
for the year ending
December 31, 2012
as compared to
$390.2 million
in the prior year. FFO was positively impacted by growth in same-center NOI and decreases in interest rate expense due to lower rates on our lines of credit and favorable refinancings. FFO is a key performance measure for real estate companies. Please see the more detailed discussion of this measure on
page 70.
Results of Operations
Comparison of the Year Ended
December 31, 2012
to the Year Ended
December 31, 2011
Properties that were in operation for the entire year during both
2012
and
2011
are referred to as the “
2012
Comparable Properties.”
Since January 1, 2011, we have acquired or opened three outlet centers, three malls and one community center as follows:
|
|
|
|
|
|
Property
|
|
Location
|
|
Date Opened /Acquired
|
New Developments
:
|
|
|
|
|
The Outlet Shoppes at Oklahoma City
(1)
|
|
Oklahoma City, OK
|
|
August 2011
|
Waynesville Commons
|
|
Waynesville, NC
|
|
October 2012
|
|
|
|
|
|
Acquisitions
:
|
|
|
|
|
Northgate Mall
|
|
Chattanooga, TN
|
|
September 2011
|
The Outlet Shoppes at El Paso
(1)
|
|
El Paso, TX
|
|
April 2012
|
The Outlet Shoppes at Gettysburg
(2)
|
|
Gettysburg, PA
|
|
April 2012
|
Dakota Square Mall
|
|
Minot, ND
|
|
May 2012
|
Kirkwood Mall
(3)
|
|
Bismarck, ND
|
|
December 2012
|
(1) The Outlet Shoppes at Oklahoma City and The Outlet Shoppes at El Paso are 75/25 joint ventures, which are included in the accompanying consolidated statements of operations on a consolidated basis.
(2) The Outlet Shoppes at Gettysburg is a 50/50 joint venture and is included in the accompanying consolidated statements of operations on a consolidated basis.
(3) The Company acquired a
49.0%
interest in Kirkwood Mall in December 2012 and executed an agreement to acquire the remaining
51.0%
interest within 90 days, subject to lender approval. This Property is included in the accompanying consolidated statements of operations on a consolidated basis.
The Properties listed above are included in our operations on a consolidated basis and are collectively referred to as the "
2012
New Properties." In addition to the above Properties, in December 2012, we purchased the remaining
40.0%
noncontrolling interest in Imperial Valley Mall in El Centro, CA from our joint venture partner. The results of operations of this Property, previously accounted for using the equity method of accounting, are included in our operations on a consolidated basis beginning December 27, 2012. The transactions related to the 2012 New Properties impact the comparison of the results of operations for the year ended
December 31, 2012
to the results of operations for the year ended
December 31, 2011
.
In October 2011, we formed a joint venture, CBL/T-C, with TIAA-CREF. As described in
Note 5
to the consolidated financial statements, we began accounting for our remaining interest in three of our malls, CoolSprings Galleria, Oak Park Mall and West County Center, which were previously accounted for on a consolidated basis, using the equity method of accounting upon formation of the joint venture. These Properties are collectively referred to as the "CBL/T-C Properties". This transaction impacts the comparison of the results of operations for the year ended
December 31, 2012
to the results of operations for the year ended
December 31, 2011
.
Revenues
Total revenues decreased by $16.7 million for 2012 compared to the prior year. Rental revenues and tenant reimbursements decreased $17.0 million due to a decrease of $70.4 million related to the CBL/T-C Properties partially offset by an increase of $39.8 million from the 2012 New Properties and an increase of $13.6 million from the 2012 Comparable Properties. The increase in rental revenues and tenant reimbursements of the 2012 Comparable Properties was driven by increases of $14.5 million in minimum rents and $1.1 million in sponsorship income partially offset by a decrease of $2.3 million in tenant reimbursements. High occupancy levels and continued improvement in leasing spreads led to the increase in minimum rents.
Our cost recovery ratio decreased to 99.7% for 2012 compared to 101.7% for 2011.
The increase in management, development and leasing fees of $3.8 million was mainly attributable to a new contract to provide property management services to a portfolio of six third party malls in 2012 as well as income from the CBL/T-C joint venture.
Other revenues decreased $3.5 million primarily due to a decrease of $2.4 million in revenues of our subsidiary that provides security and maintenance services to third parties.
Operating Expenses
Total operating expenses decreased $37.1 million for 2012 compared to the prior year due to a $26.9 million decrease in loss on impairment of real estate. Property operating expenses, including real estate taxes and maintenance and repairs, decreased $7.3 million due to a decrease of $21.6 million related to the CBL/T-C Properties partially offset by increases of $13.3 million related to the 2012 New Properties and $1.0 million attributable to the 2012 Comparable Properties. The $1.0 million increase in property operating expenses of the 2012 Comparable Properties is primarily attributable to increases of $2.5 million in real estate taxes and $2.4 million in payroll costs, which were partially offset by decreases of $2.8 million in utilities and snow removal costs, $0.4 million in land rent expense, $0.4 million in promotion-related costs and $0.3 million in insurance expense.
The decrease in depreciation and amortization expense of $5.6 million resulted from a decrease of $23.8 million related to the CBL/T-C Properties and $1.3 million from the 2012 Comparable Properties, partially offset by an increase of $19.5 million from the 2012 New Properties. The decrease attributable to the 2012 Comparable Properties is primarily attributable to lower amortization of tenant allowances due to write-offs of unamortized tenant allowances in the prior year period related to certain store closings partially offset by ongoing capital expenditures for renovations, expansions and deferred maintenance.
General and administrative expenses increased $6.5 million primarily as a result of an increase of $3.9 million in payroll and related expenses, a decrease of $0.8 for capitalized overhead related to development projects, an increase of $0.7 million in legal and other professional services and an increase of $0.7 million related to accelerating the vesting of certain restricted stock awards. The balance of the increase was attributable to increased costs in acquisition costs and several other general and administrative accounts. As a percentage of revenues, general and administrative expenses were 5.0% in 2012 compared to 4.3% in 2011. General and administrative expenses as a percentage of revenues were slightly higher in 2012 due to lower revenues as a result of the deconsolidation of the CBL/T-C Properties.
During 2012, we recorded a non-cash impairment of real estate of $24.4 million. The $24.4 million impairment is attributable to a $20.3 million loss recorded to reduce the fair value of land available for the future expansion of an associated center, a $3.0 million loss to write down the book value of an associated center and a $1.1 million loss from the sale of three outparcels. During 2011, we recorded a non-cash impairment of real estate of $51.3 million, which consisted of $50.7 million related to Columbia Place in Columbia, SC and $0.6 million related to a loss on the sale of a land parcel. Columbia Place experienced declining cash flows as a result of changes in property-specific market conditions, which were further exacerbated by economic conditions that negatively impacted leasing activity and occupancy. See
Note 15
to the consolidated financial statements for further discussion of impairment charges.
Other expenses decreased $3.8 million primarily due to lower expenses of $2.2 million related to our subsidiary that provides security and maintenance services to third parties, a write-down of $1.5 million recorded in 2011 to reduce the carrying value of a mortgage note receivable to equal its estimated realizable value, for which we foreclosed on the land that served as collateral on the loan, and a decrease of $0.1 million in abandoned projects expense.
Other Income and Expenses
Interest and other income increased $1.4 million in 2012 compared to the prior year period, primarily as a result of two mezzanine loans for two outlet centers. We earned $0.4 million in interest income on these loans and subsequently recognized $0.6 million of unamortized discounts on these loans when they terminated in connection with the acquisition of member interests in both outlet centers in 2012. We also earned $0.4 million of interest income on a note receivable related to the development of The Outlet Shoppes at Atlanta, located in Woodstock, GA.
Interest expense decreased $22.6 million in 2012 compared to the prior year period. Interest expense related to the CBL/T-C Properties decreased $25.2 million partially offset by an increase of $10.3 million related to the 2012 New Properties. The remaining decrease was primarily related to our continued efforts to deleverage our balance sheet as we used our credit facilities to retire higher rate mortgages loans and refinanced other Properties at favorable fixed rates. Our weighted average interest rate was 4.86% as of December 31, 2012 compared to 5.04% as of December 31, 2011. Additionally, we modified and extended our two largest credit facilities in the fourth quarter of 2012 reducing average spreads by 60 basis points.
During 2012, we recorded a gain on extinguishment of debt of $0.3 million in connection with the early retirement of a mortgage loan. During 2011, we recorded a gain on extinguishment of debt of $1.0 million as a result of the early retirement of debt on two malls.
We recorded a gain on investment of $45.1 million during 2012 related to the acquisition of a controlling interest in Imperial Valley Mall, located in El Centro, CA, when we acquired our joint venture partner's 40% interest.
We recognized a gain on sale of real estate assets of $2.3 million in 2012 related to the sale of a vacant anchor space at one of our malls and the sale of eight parcels of land. During 2011, we recognized a gain on sales of real estate assets of $59.4 million. Of this amount, $54.3 million was related to the sale of a portion of our interests in the CBL/T-C Properties and $5.1 million was related to the sale of a vacant anchor space at one of our malls and five parcels of land.
Equity in earnings of unconsolidated affiliates increased by $2.2 million during 2012. Gains related to the sales of three outparcels comprised $1.4 million of the increase. Increases in revenues from several new tenants and favorable rent increases for existing tenants at several unconsolidated Properties also contributed to this increase, reflecting improved occupancy and rental rates consistent with the 2012 Comparable Properties.
The income tax provision of $1.4 million in 2012 primarily relates to our Management Company, which is a taxable REIT subsidiary, and consists of a current tax benefit of $1.7 million and a deferred income tax provision of $3.1 million. During 2011, we recorded an income tax benefit of $0.3 million, consisting of a current tax provision of $5.4 million, partially offset by a deferred income tax benefit of $5.7 million. Our taxable REIT subsidiary had higher income in 2012 compared to 2011 primarily as a result of an increase in the management fee income from our own portfolio of Properties. Because this fee income is from our consolidated Properties, the fee income is eliminated in our consolidated financial statements; however, there is still a tax effect to the taxable REIT subsidiary.
Loss from discontinued operations for 2012 of $19.6 million includes an aggregate loss of $26.5 million on impairment of real estate which was partially offset by the operating results of two malls and four community centers that were sold during 2012, the operating results of two office buildings classified as held for sale as of December 31, 2012 and a $0.1 million gain on sale of real estate related to one community center that was sold in 2012.
Operating income from discontinued operations for 2011 of $23.9 million includes a gain on extinguishment of debt of $31.4 million for one mall sold in 2011, the operating results of one mall and one community center that were sold in 2011, the operating results of two malls and four community centers that were sold in 2012 and the operating results of two office buildings that were classified as held for sale as of December 31, 2012, which were partially offset by an aggregate loss on impairment of real estate of $7.4 million.
We also recorded a gain on discontinued operations of $0.9 million in 2012 related to the sale of a community center.
Comparison of the Year Ended
December 31, 2011
to the Year Ended
December 31, 2010
Properties that were in operation for the entire year during both
2011
and
2010
are referred to as the “
2011
Comparable Properties.” From January 1, 2010 to
December 31, 2011
, we acquired or opened one mall, one outlet center and two community centers as follows:
|
|
|
|
|
|
Property
|
|
Location
|
|
Date Opened/Acquired
|
New Developments
:
|
|
|
|
|
The Pavilion at Port Orange
(1)
|
|
Port Orange, FL
|
|
March 2010
|
The Forum at Grandview - Phase I
|
|
Madison, MS
|
|
November 2010
|
The Outlet Shoppes at Oklahoma City
(2)
|
|
Oklahoma City, OK
|
|
August 2011
|
|
|
|
|
|
Acquisition:
|
|
|
|
|
Northgate Mall
|
|
Chattanooga, TN
|
|
September 2011
|
|
|
(1)
|
The Pavilion at Port Orange is a 50/50 joint venture that is accounted for using the equity method of accounting and is included in equity in earnings (losses) of unconsolidated affiliates in the accompanying consolidated statements of operations.
|
|
|
(2)
|
The Outlet Shoppes at Oklahoma City is a 75/25 joint venture, which is included in the accompanying consolidated statements of operations on a consolidated basis.
|
The Forum at Grandview, The Outlet Shoppes at Oklahoma City and Northgate Mall are included in our operations on a consolidated basis and are collectively referred to as the "2011 New Properties." In addition to the above Properties, in October 2010, we purchased the remaining 50% interest in Parkway Place in Huntsville, AL, from our joint venture partner. The results of operations of this Property, previously accounted for using the equity method of accounting, are included in our operations on a consolidated basis beginning October 1, 2010.The transactions related to the
2011
New Properties impact the comparison of the results of operations for the year ended
December 31, 2011
to the results of operations for the year ended
December 31, 2010
.
Revenues
Total revenues increased by $5.6 million for 2011 compared to the prior year. Rental revenues and tenant reimbursements decreased $0.5 million due to a decrease of $19.4 million related to the CBL/T-C Properties partially offset by an increase of $10.8 million from the 2011 Comparable Properties and an increase of $8.1 million from the 2011 New Properties. The purchase of the additional interest in Parkway Place in October 2010 comprised $8.6 million of the increase from the 2011 Comparable Properties. The remaining increase in rental revenues and tenant reimbursements of the 2011 Comparable Properties was primarily driven by a $2.2 million increase in minimum rents as a result of overall improvement in leasing spreads and higher occupancy levels.
Our cost recovery ratio decreased to 101.7% for 2011 compared to 104.0% for 2010.
The increase in management, development and leasing fees of $0.5 million was mainly attributable to the management fees from the CBL/T-C Properties after the formation of CBL/T-C.
Other revenues increased $5.6 million primarily due to an increase of $3.9 million in revenues of our subsidiary that provides security and maintenance services to third parties.
Operating Expenses
Total operating expenses increased $48.4 million for 2011 compared to the prior year due to a $50.1 million increase in loss on impairment of real estate. Property operating expenses, including real estate taxes and maintenance and repairs, increased $2.6 million due to higher expenses of $6.1 million related to the 2011 Comparable Properties, of which $2.5 million is attributable to the consolidation of Parkway Place, and $3.0 million related to the 2011 New Properties, which were partially offset by a decrease of $6.4 million related to the CBL/T-C Properties. The increase in property operating expenses of the 2011 Comparable Properties is primarily attributable to increases of $2.9 million in security and maintenance expense, $1.9 million in utilities expense and $1.3 million in promotion-related costs.
The decrease in depreciation and amortization expense of $9.1 million resulted from a decrease of $8.7 million related to the CBL/T-C Properties and $2.4 million from the 2011 Comparable Properties, partially offset by an increase of $2.0 million from the 2011 New Properties. The decrease attributable to the 2011 Comparable Properties is primarily attributable to lower amortization of tenant allowances due to write-offs of unamortized tenant allowances in the prior year period related to certain store closings partially offset by an increase related to the consolidation of Parkway Place.
General and administrative expenses increased $1.4 million primarily as a result of increases of $1.1 million in payroll and related expenses, $0.6 million in legal and consulting expenses and $0.6 million in insurance expense, partially offset by a reduction of $0.6 million in travel costs. As a percentage of revenues, general and administrative expenses were 4.3% in 2011 compared to 4.1% in 2010.
During 2011, we recorded a non-cash impairment of real estate of $51.3 million, which consisted of $50.7 million related to Columbia Place in Columbia, SC and $0.6 million related to a loss on the sale of a land parcel. Columbia Place experienced declining cash flows as a result of changes in property-specific market conditions, which were further exacerbated by the recent economic conditions that negatively impacted leasing activity and occupancy. See
Carrying Value of Long-Lived Assets
in the Critical Accounting Policies and Estimates section herein for further discussion of impairment charges.
Other expenses increased $3.4 million primarily due to higher expenses of $3.8 million related to our subsidiary that provides security and maintenance services to third parties, partially offset by a decrease of $0.3 million in abandoned projects expense.
Other Income and Expenses
Interest and other income decreased $1.3 million in 2011 compared to the prior year period due to the elimination of interest income on advances to two joint ventures and a mortgage note receivable. Interest income declined on one joint venture to which we had outstanding advances when it was sold in June 2010 and, in October 2010, we purchased our partner's 50% share of the joint venture that owned Parkway Place to which we previously had outstanding advances. In addition, interest income is no longer being accrued on a mortgage note receivable for which we foreclosed on the land that served as collateral on the loan.
Interest expense decreased $14.0 million in 2011 compared to the prior year. The CBL/T-C Properties comprised $8.1 million of the decrease, which was partially offset by an increase of $2.0 million related to the 2011 New Properties. The remaining decrease was primarily related to our continued efforts to deleverage our balance sheet as we decreased our consolidated debt by $720.4 million to $4,489.4 million from December 31, 2010 to December 31, 2011. Additionally, during the second and third quarters of 2011, our secured credit facilities were modified to remove a 1.50% floor on LIBOR and to
reduce the amount of the spreads above LIBOR based on our leverage.
During 2011, we recorded a gain on extinguishment of debt of $1.0 million as a result of accelerated premium amortization related to the early retirement of debt on two malls.
We recorded a gain on investment of $0.9 million during 2010 related to the acquisition of the remaining 50% interest in Parkway Place in Huntsville, AL from our joint venture partner. There were no transactions of this nature in 2011.
During 2011, we recognized gain on sales of real estate assets of $59.4 million. Of this amount, $54.3 million was related to the sale of a portion of our interests in the CBL/T-C Properties and $5.1 million was related to the sale of a vacant anchor space at one of our malls and five parcels of land. We recognized a gain on sales of real estate assets of $2.9 million during 2010 from the sale of eight parcels of land.
Equity in earnings (losses) of unconsolidated affiliates increased by $6.3 million during 2011. One joint venture Property that opened in March 2010 contributed to the increase compared to the prior year. Increases in revenues and tenant reimbursements were key drivers at several unconsolidated Properties, reflecting improved occupancy and rental rates consistent with the 2011 Comparable Properties. Additionally, our share of the earnings of the CBL/T-C Properties accounted for $0.3 million of the increase. In addition, outparcel sales increased approximately $0.3 million compared to the prior year. These increases were partially offset by a decline in earnings from Parkway Place as a result of the acquisition of the remaining 50% interest from our joint venture partner in October 2010. Results of Parkway Place are now reported on a consolidated basis.
The income tax benefit of $0.3 million in 2011 primarily relates to our taxable REIT subsidiary and consists of a current tax provision of $5.4 million and a deferred income tax benefit of $5.7 million. During 2010, we recorded an income tax benefit of $6.4 million, consisting of a current tax benefit of $8.4 million, partially offset by a deferred income tax provision of $2.0 million. Our taxable REIT subsidiary had higher income in 2011 compared to 2010 primarily as a result of an increase in the management fee income from our own portfolio of Properties. Because this fee income is from our consolidated Properties, the fee income is eliminated in our consolidated financial statements; however, there is still a tax effect to the taxable REIT subsidiary.
Operating income from discontinued operations for 2011 of $23.9 million includes a gain on extinguishment of debt of $31.4 million for one mall sold in 2011, the operating results of one mall and one community center that were sold in 2011, the operating results of two malls and four community centers that were sold in 2012 and the operating results of two office buildings that were classified as held for sale as of December 31, 2012, which were partially offset by an aggregate loss on impairment of real estate of $7.4 million.
Loss on discontinued operations for 2010 of $36.5 million includes an aggregate loss on impairment of real estate assets of $39.1 million primarily from one mall sold in 2011 and one community center was sold in 2010, which were partially offset by operating results of one mall and two community centers that were sold in 2010, operating results of one mall and one community center that were sold in 2011, operating results of two malls and three community centers that were sold in 2012 and operating results of two office buildings that were classified as held for sale as of December 31, 2012,
Same-Center Net Operating Income
We present same-center NOI as a supplemental performance measure of the operating performance of our same-center Properties. NOI is defined as operating revenues (rental revenues, tenant reimbursements, and other income) less property operating expenses (property operating, real estate taxes, and maintenance and repairs). We compute NOI based on our pro rata share of both consolidated and unconsolidated Properties. Our definition of NOI may be different than that used by other real estate companies, and accordingly, our calculation of NOI may not be comparable to other real estate companies.
Since same-center NOI includes only those revenues and expenses related to the operations of Comparable Properties, we believe same-center NOI provides a measure that reflects trends in occupancy rates, rental rates, and operating costs and the impact of those trends on our results of operations. Additionally, there are instances when tenants terminate their leases prior to the scheduled expiration date and pay us lease termination fees. These one-time lease termination fees may distort same-center NOI and not be indicative of the ongoing operations of our shopping center Properties. Therefore, we believe presenting same-center NOI, excluding lease termination fees, is useful to investors.
We included a Property in our same-center pool when we owned all or a portion of the Property as of
December 31, 2012
, and we owned it and it was in operation for both the entire preceding calendar year and the current year ending
December 31, 2012
. The only Properties excluded from the same-center pool that would otherwise meet this criteria are non-core Properties and Properties included in discontinued operations. As of
December 31, 2012
, Columbia Place is the only Property classified as a non-core Property. New Properties are excluded from same-center NOI, until they meet this criteria.
Due to the exclusions noted above, same-center NOI should only be used as a supplemental measure of our performance and not as an alternative to GAAP operating income (loss) or net income (loss). A reconciliation of our same-
center NOI to net income attributable to the Company for the years ended
December 31, 2012
and
2011
is as follows (in thousands):
|
|
|
|
|
|
|
|
|
|
|
|
Year Ended December 31,
|
|
|
2012
|
|
2011
|
Net income attributable to the Company
|
|
$
|
131,600
|
|
|
$
|
133,936
|
|
|
|
|
|
|
Adjustments:
(1)
|
|
|
|
|
Depreciation and amortization
|
|
307,519
|
|
|
307,989
|
|
Interest expense
|
|
285,769
|
|
|
303,116
|
|
Abandoned projects expense
|
|
(39
|
)
|
|
94
|
|
Gain on sales of real estate assets
|
|
(6,496
|
)
|
|
(60,841
|
)
|
Gain on extinguishment of debt
|
|
(265
|
)
|
|
(32,463
|
)
|
Gain on investments
|
|
(45,072
|
)
|
|
—
|
|
Write-down of mortgage notes receivable
|
|
—
|
|
|
1,900
|
|
Loss on impairment of real estate
|
|
50,840
|
|
|
58,729
|
|
Income tax provision (benefit)
|
|
1,404
|
|
|
(269
|
)
|
Net income attributable to noncontrolling interest
in earnings of operating partnership
|
|
19,267
|
|
|
25,841
|
|
(Gain) loss on discontinued operations
|
|
(938
|
)
|
|
1
|
|
Operating partnership's share of total NOI
|
|
743,589
|
|
|
738,033
|
|
General and administrative expenses
|
|
51,251
|
|
|
44,751
|
|
Management fees and non-property level revenues
|
|
(27,729
|
)
|
|
(22,827
|
)
|
Operating partnership's share of property NOI
|
|
767,111
|
|
|
759,957
|
|
Non-comparable NOI
|
|
(36,361
|
)
|
|
(43,981
|
)
|
Total same-center NOI
|
|
730,750
|
|
|
715,976
|
|
Less lease termination fees
|
|
(3,456
|
)
|
|
(2,945
|
)
|
Total same-center NOI, excluding lease termination fees
|
|
$
|
727,294
|
|
|
$
|
713,031
|
|
|
|
|
(1)
|
Adjustments are based on our pro rata ownership share, including our share of unconsolidated affiliates and excluding noncontrolling interests' share of consolidated Properties.
|
Same-center NOI, excluding lease termination fees, increased $14.3 million for the year ended
December 31, 2012
compared to
2011
. The 2.0% increase for
2012
compared to the prior year was driven by occupancy gains and positive leasing spreads. The majority of the increase in NOI was from our Malls segment.
Operational Review
The shopping center business is, to some extent, seasonal in nature with tenants typically achieving the highest levels of sales during the fourth quarter due to the holiday season, which generally results in higher percentage rents in the fourth quarter. Additionally, the malls earn most of their rents from short-term tenants during the holiday period. Thus, occupancy levels and revenue production are generally the highest in the fourth quarter of each year. Results of operations realized in any one quarter may not be indicative of the results likely to be experienced over the course of the fiscal year.
We derive the majority of our revenues from the Mall Properties. The sources of our revenues by property type were as follows:
|
|
|
|
|
|
|
|
Year Ended December 31,
|
|
2012
|
|
2011
|
Malls
|
89.8
|
%
|
|
87.8
|
%
|
Associated centers
|
4.1
|
%
|
|
3.9
|
%
|
Community centers
|
1.2
|
%
|
|
1.7
|
%
|
Mortgages, office buildings and other
|
4.9
|
%
|
|
6.6
|
%
|
Mall Store Sales
Mall store sales for the year ended
December 31, 2012
on a comparable per square foot basis, including license agreements, were $346 per square foot compared with $334 per square foot for
2011
, representing an increase of 3.6%. Going forward we will begin reporting comparable Mall store sales excluding license agreements, which we believe is more consistent with current industry standards. License agreements are rental contracts that are temporary or short-term in nature generally lasting more than three months but less than twelve months. Mall store sales, excluding license agreements, for the year ended December 31, 2012 on a comparable per square foot basis were $353 per square foot compared with $342 per square foot for 2011 representing an increase of 3.2%. The holiday shopping season was solid and on par with industry expectations. Regionally, we saw strength in sales from our border malls, partially fueled by the favorable exchange rate. The steady economy and improving unemployment rates lead us to project sales growth for 2013 similar to what we experienced in 2012.
Occupancy
Our portfolio occupancy is summarized in the following table:
|
|
|
|
|
|
|
|
As of December 31,
|
|
2012
|
|
2011
|
Total portfolio
(1)
|
94.6
|
%
|
|
93.6
|
%
|
Total mall portfolio
(1)
|
94.6
|
%
|
|
94.1
|
%
|
Stabilized malls
(1)
|
94.5
|
%
|
|
94.2
|
%
|
Non-stabilized malls
(2)
|
100.0
|
%
|
|
92.1
|
%
|
Associated centers
|
94.8
|
%
|
|
93.4
|
%
|
Community centers
|
95.9
|
%
|
|
91.5
|
%
|
|
|
(1)
|
Excludes occupancy for Kirkwood Mall, which was acquired in December 2012.
|
|
|
(2)
|
Represents occupancy for The Outlet Shoppes at Oklahoma City as of
December 31, 2012
and occupancy for Pearland Town Center and The Outlet Shoppes at Oklahoma City as of
December 31, 2011
. Pearland Town Center is classified as a stabilized mall in 2012.
|
Continued demand from new and existing tenants generated year-over-year occupancy increases in every category of our portfolio. Occupancy improved 100 basis points in 2012 to 94.6% across our total portfolio as compared to 2011. Our stabilized mall occupancy also improved 30 basis points to 94.5% as compared to the prior year. For 2013, we are forecasting occupancy improvements of 25 to 50 basis points as compared to 2012 for the total portfolio.
Leasing
During
2012
, we signed more than 6.1 million square feet of leases, including 5.8 million square feet of leases in our operating portfolio and 0.3 million square feet of development leases. The leases signed in our operating portfolio included approximately 1.5 million square feet of new leases and approximately 4.2 million square feet of renewals. This compares with a total of approximately 7.1 million square feet of leases signed during 2011, including 6.8 million square feet of leases in our operating portfolio and 0.3 million square feet of development leasing.
Average annual base rents per square foot are based on contractual rents in effect as of
December 31, 2012
and
2011
, including the impact of any rent concessions. Average annual base rents per square foot for comparable small shop space of less than 10,000 square feet were as follows for each property type:
|
|
|
|
|
|
|
|
|
|
December 31,
|
|
2012
|
|
2011
|
Stabilized malls
(1)
|
$
|
29.72
|
|
|
$
|
29.68
|
|
Non-stabilized malls
(2)
|
22.81
|
|
|
23.92
|
|
Associated centers
|
11.90
|
|
|
11.65
|
|
Community centers
|
16.02
|
|
|
14.38
|
|
Office buildings
|
18.62
|
|
|
17.68
|
|
|
|
(1)
|
Excludes average annual base rents for Kirkwood Mall, which was acquired December 2012. Average annual bases rents as of December 31, 2012 were impacted by the addition of two outlet centers acquired in 2012, which have lower average base rents than traditional malls and one mall acquired in 2012 that has lower average base rents than our stabilized mall portfolio.
|
|
|
(2)
|
Represents average annual base rents for The Outlet Shoppes at Oklahoma City as of
December 31, 2012
and average annual base rents for Pearland Town Center and The Outlet Shoppes at Oklahoma City as of
December 31, 2011
. Pearland Town Center is classified as a stabilized Mall in 2012.
|
Results from new and renewal leasing of comparable small shop space of less than 10,000 square feet during the year ended
December 31, 2012
for spaces that were previously occupied are as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Property Type
|
|
Square Feet
|
|
Prior Gross
Rent PSF
|
|
New Initial
Gross Rent
PSF
|
|
% Change
Initial
|
|
New Average
Gross Rent
PSF (2)
|
|
% Change
Average
|
All Property Types
(1)
|
|
2,892,058
|
|
|
$
|
38.74
|
|
|
$
|
40.55
|
|
|
4.7
|
%
|
|
$
|
41.86
|
|
|
8.1
|
%
|
Stabilized Malls
|
|
2,642,733
|
|
|
40.49
|
|
|
42.50
|
|
|
5.0
|
%
|
|
43.87
|
|
|
8.4
|
%
|
New leases
|
|
487,734
|
|
|
43.36
|
|
|
50.48
|
|
|
16.4
|
%
|
|
53.49
|
|
|
23.4
|
%
|
Renewal leases
|
|
2,154,999
|
|
|
39.83
|
|
|
40.69
|
|
|
2.2
|
%
|
|
41.69
|
|
|
4.7
|
%
|
|
|
(1)
|
Includes stabilized malls, associated centers, community centers and office buildings with the exception of Kirkwood Mall, which was acquired in December 2012.
|
(2) Average gross rent does not incorporate allowable future increases for recoverable common area expenses.
For stabilized mall leasing in 2012, on a same space basis, rental rates were signed at an average increase of 8.4% from the prior gross rent per square foot for new and renewal leases. Demand from new and existing tenants created ongoing improvement in our leasing spreads for both new and renewal leases across our portfolio.
Our goal is to continue to convert shorter term leases to longer terms. We also anticipate continued improvements in rental rates during 2013 as retailers seek out space in our market-dominant Properties and new supply remains constricted.
Liquidity and Capital Resources
We continue to focus on reducing our debt levels while exploring opportunities to diversify our financing structure. We believe an investment grade rating would provide us with access to a broader range of corporate securities leading to a more diversified and flexible balance sheet with lower overall cost of capital. The process to achieve an investment grade rating is complex and we anticipate could take up to two years to achieve. As an initial step in the rating process, we increased our pool of unencumbered properties through the extension and modification in November 2012 of our two largest credit facilities totaling $1.2 billion. As of
December 31, 2012
, we had approximately $818.1 million available on all of our credit facilities combined.
As discussed in
Note 14
to the accompanying consolidated financial statements, under the terms of the joint venture agreement for CW Joint Venture, LLC (“CWJV” ), we have the ability to redeem Westfield Group's ("Westfield") Westfield's preferred units beginning January 31, 2013 and anticipate we will redeem them in the middle of 2013 using a combination of capital sources. As a short-term solution, we will have sufficient capacity on our credit facilities to redeem all of the preferred units. However, we expect a longer-term option will involve a combination of assets sales, excess proceeds from refinancings and other capital sources.
We derive a majority of our revenues from leases with retail tenants, which have historically been the primary source for funding short-term liquidity and capital needs such as operating expenses, debt service, tenant construction allowances, recurring capital expenditures, dividends and distributions. We believe that the combination of cash flows generated from our operations, combined with our debt and equity sources and the availability under our lines of credit will, for the foreseeable future, provide adequate liquidity to meet our cash needs. In addition to these factors, we have options available to us to generate additional liquidity, including but not limited to, equity offerings, joint venture investments, issuances of noncontrolling interests in our Operating Partnership, and decreasing expenditures related to tenant construction allowances and other capital expenditures. We also generate revenues from sales of peripheral land at the Properties and from sales of real estate assets when it is determined that we can realize an optimal value for the assets.
Cash Flows From Operations
There was
$78.2 million
of unrestricted cash and cash equivalents as of
December 31, 2012
, an increase of $22.2 million from
December 31, 2011
. Cash provided by operating activities during 2012, increased $39.7 million to
$481.5 million
from
$441.8 million
during 2011. The increase is primarily due to the operations of the 2012 New Properties, same-center NOI growth of the 2012 Comparable Properties, an increase in fee income and the reduction in interest expense as a result of our ongoing efforts to reduce debt levels.
Debt
The following tables summarize debt based on our pro rata ownership share, including our pro rata share of unconsolidated affiliates and excluding noncontrolling investors’ share of consolidated Properties, because we believe this provides investors and lenders a clearer understanding of our total debt obligations and liquidity (in thousands):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated
|
|
Noncontrolling Interests
|
|
Unconsolidated Affiliates
|
|
Total
|
|
Weighted
Average
Interest
Rate
(1)
|
December 31, 2012:
|
|
|
|
|
|
|
|
|
|
Fixed-rate debt:
|
|
|
|
|
|
|
|
|
|
Non-recourse loans on operating properties
(2)
|
$
|
3,776,245
|
|
|
$
|
(89,530
|
)
|
|
$
|
660,563
|
|
|
$
|
4,347,278
|
|
|
5.48
|
%
|
Financing method obligation
(3)
|
18,264
|
|
|
—
|
|
|
—
|
|
|
18,264
|
|
|
|
Total fixed-rate debt
|
3,794,509
|
|
|
(89,530
|
)
|
|
660,563
|
|
|
4,365,542
|
|
|
5.48
|
%
|
Variable-rate debt:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-recourse term loans on operating properties
|
123,875
|
|
|
—
|
|
|
—
|
|
|
123,875
|
|
|
3.36
|
%
|
Recourse term loans on operating properties
|
97,682
|
|
|
—
|
|
|
128,491
|
|
|
226,173
|
|
|
2.16
|
%
|
Construction loans
|
15,366
|
|
|
—
|
|
|
—
|
|
|
15,366
|
|
|
2.96
|
%
|
Unsecured lines of credit
(4)
|
475,626
|
|
|
—
|
|
|
—
|
|
|
475,626
|
|
|
2.07
|
%
|
Secured lines of credit
|
10,625
|
|
|
—
|
|
|
—
|
|
|
10,625
|
|
|
2.46
|
%
|
Unsecured term loans
|
228,000
|
|
|
—
|
|
|
—
|
|
|
228,000
|
|
|
1.82
|
%
|
Total variable-rate debt
|
951,174
|
|
|
—
|
|
|
128,491
|
|
|
1,079,665
|
|
|
2.39
|
%
|
Total
|
$
|
4,745,683
|
|
|
$
|
(89,530
|
)
|
|
$
|
789,054
|
|
|
$
|
5,445,207
|
|
|
4.86
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated
|
|
Noncontrolling Interests
|
|
Unconsolidated Affiliates
|
|
Total
|
|
Weighted
Average
Interest
Rate
(1)
|
December 31, 2011:
|
|
|
|
|
|
|
|
|
|
Fixed-rate debt:
|
|
|
|
|
|
|
|
|
|
Non-recourse loans on operating properties
(2)
|
$
|
3,637,979
|
|
|
$
|
(30,416
|
)
|
|
$
|
658,470
|
|
|
$
|
4,266,033
|
|
|
5.58
|
%
|
Recourse term loans on operating properties
|
77,112
|
|
|
—
|
|
|
—
|
|
|
77,112
|
|
|
5.89
|
%
|
Financing method obligation
(3)
|
18,264
|
|
|
—
|
|
|
—
|
|
|
18,264
|
|
|
|
Total fixed-rate debt
|
3,733,355
|
|
|
(30,416
|
)
|
|
658,470
|
|
|
4,361,409
|
|
|
5.58
|
%
|
Variable-rate debt:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-recourse term loans on operating properties
|
168,750
|
|
|
—
|
|
|
19,716
|
|
|
188,466
|
|
|
2.88
|
%
|
Recourse term loans on operating properties
|
124,439
|
|
|
(726
|
)
|
|
130,455
|
|
|
254,168
|
|
|
3.32
|
%
|
Construction loans
|
25,921
|
|
|
—
|
|
|
—
|
|
|
25,921
|
|
|
3.32
|
%
|
Secured lines of credit
|
27,300
|
|
|
—
|
|
|
—
|
|
|
27,300
|
|
|
3.03
|
%
|
Unsecured term loans
|
409,590
|
|
|
—
|
|
|
—
|
|
|
409,590
|
|
|
1.67
|
%
|
Total variable-rate debt
|
756,000
|
|
|
(726
|
)
|
|
150,171
|
|
|
905,445
|
|
|
2.47
|
%
|
Total
|
$
|
4,489,355
|
|
|
$
|
(31,142
|
)
|
|
$
|
808,641
|
|
|
$
|
5,266,854
|
|
|
5.04
|
%
|
|
|
(1)
|
Weighted average interest rate includes the effect of debt premiums (discounts), but excludes amortization of deferred financing costs.
|
|
|
(2)
|
We had
four
interest rate swaps on notional amounts outstanding totaling
$113.9 million
as of
December 31, 2012
and
$117.7 million
as of
December 31, 2011
related to
four
of our variable-rate loans on operating Properties to effectively fix the interest rates on these loans. Therefore, these amounts are reflected in fixed-rate debt at
December 31, 2012
and
2011
.
|
|
|
(3)
|
This amount represents the noncontrolling partner's equity contribution that is accounted for as a financing due to certain terms of the joint venture agreement related to Pearland Town Center, in which we own an
88.0%
interest. See
Note 5
to the consolidated financial statements for further information.
|
|
|
(4)
|
We converted two of our credit facilities from secured facilities to unsecured facilities in November 2012.
|
Of the
$547.3 million
of our pro rata share of consolidated and unconsolidated debt as of
December 31, 2012
that is scheduled to mature during
2013
, excluding debt premiums, we have extensions available on $68.6 million of debt at our option that we intend to exercise, leaving $478.7 million of debt maturities in
2013
that must be retired or refinanced, representing 14 operating Property loans and one unsecured term loan. We plan to retire loans secured by wholly-owned Properties using our lines of credit. Loans secured by joint venture Properties will be refinanced. Subsequent to
December 31, 2012
, we retired
two
operating Property loans with an outstanding balance of
$77.1 million
as of
December 31, 2012
.
The weighted average remaining term of our total share of consolidated and unconsolidated debt was 4.6 years and 4.5 years at
December 31, 2012
and
2011
, respectively. The weighted average remaining term of our pro rata share of fixed-rate debt was 5.2 years and 5.0 years at
December 31, 2012
and
2011
, respectively.
As of
December 31, 2012
and
2011
, our pro rata share of consolidated and unconsolidated variable-rate debt represented 19.8% and 17.2%, respectively, of our total pro rata share of debt. The increase is primarily due to using our lines of credit to retire higher fixed-rate property-specific mortgages as we continue to grow our unencumbered asset pool to facilitate our strategy to achieve an investment grade rating as well as to support our lines of credit. As of
December 31, 2012
, our share of consolidated and unconsolidated variable-rate debt represented 10.7% of our total market capitalization (see Equity below) as compared to 10.3% as of
December 31, 2011
.
See
Note 3
to the accompanying consolidated financial statements for a description of debt assumed in connection with acquisitions completed during the year ended
December 31, 2012
.
Unsecured Lines of Credit
In November 2012, we closed on the modification and extension of our
$525.0 million
and
$520.0 million
secured credit facilities. Under the terms of the agreements, of which Wells Fargo Bank NA serves as the administrative agent for the lender groups, the
two
secured credit facilities were converted to
two
unsecured credit facilities ("Facility A" and "Facility B") with an increase in capacity on each to
$600.0 million
for a total capacity of
$1.2 billion
. We paid aggregate fees of approximately
$4.3 million
in connection with the extension and modification of the facilities. Facility A matures in
November 2015
and has a
one
-year extension option for an outside maturity date of
November 2016
. Facility B matures in
November 2016
and has a
one
-year extension option for an outside maturity date of
November 2017
. The extension options on both facilities are at our election, subject to continued compliance with the terms of the facilities, and have a one-time extension fee of
0.20%
of the commitment amount of each credit facility. Both unsecured facilities bear interest at an annual rate equal to one-month, three-month, or six-month LIBOR plus a range of
155
to
210
basis points based on our leverage ratio. We also pay annual unused facility fees, on a quarterly basis, at rates of either
0.25%
or
0.35%
based on any unused commitment of each facility. In the event we obtain an investment grade rating by either Standard & Poor's or Moody's, we may make a one-time irrevocable election to use our credit rating to determine the interest rate on each facility. If we were to make such an election, the interest rate on each facility would bear interest at an annual rate equal to one-month, three-month, or six-month LIBOR plus a spread of
100
to
175
basis points. Once we elect to use our credit rating to determine the interest rate on each facility, we will begin to pay an annual facility fee that ranges from
0.15%
to
0.35%
of the total capacity of each facility rather than the annual unused commitment fees described above. We use our lines of credit for mortgage retirement, working capital, construction and acquisition purposes, as well as issuances of letters of credit. The
two
unsecured lines of credit had a weighted average interest rate of
2.07%
at
December 31, 2012
. The following summarizes certain information about the unsecured lines of credit as of
December 31, 2012
:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
Capacity
|
|
Total
Outstanding
|
|
Maturity
Date
|
|
Extended
Maturity
Date
|
Facility A
|
600,000
|
|
|
300,297
|
|
(1)
|
November 2015
|
|
November 2016
|
Facility B
|
600,000
|
|
|
175,329
|
|
|
November 2016
|
|
November 2017
|
|
$
|
1,200,000
|
|
|
$
|
475,626
|
|
|
|
|
|
|
|
(1)
|
There was an additional
$601
outstanding on this facility as of
December 31, 2012
for letters of credit. Up to
$50,000
of the capacity on this facility can be used for letters of credit.
|
Secured Line of Credit
In June 2012, we closed on the extension and modification of our
$105.0 million
secured credit facility. The facility's maturity date was extended to
June 2015
and has a
one
-year extension option, which is at our election and subject to continued compliance with the terms of the facility, for an outside maturity date of
June 2016
. The facility bears interest at an annual rate equal to one-month LIBOR plus a margin of
175
to
275
basis points based on our leverage ratio. The line is secured by mortgages on certain of our operating Properties and is used for mortgage retirement, working capital, construction and acquisition purposes. The secured line of credit had a weighted average interest rate of
2.46%
at
December 31, 2012
. We also pay a non-usage fee based on the amount of unused availability under our secured line of credit at
0.15%
of unused availability. The
$105.0 million
secured credit facility had
$10.6 million
outstanding at
December 31, 2012
.
The secured line of credit is collateralized by
six
of the Company’s Properties, or certain parcels thereof, which had an aggregate net carrying value of
$130.8 million
at
December 31, 2012
.
See
Note 20
to the consolidated financial statements for subsequent event related to the secured credit facility.
Unsecured Term Loans
We have an unsecured term loan of
$228.0 million
that bears interest at LIBOR plus a margin of
1.50%
to
1.80%
based on our leverage ratio, as defined in the loan agreement. At
December 31, 2012
, the outstanding borrowings of
$228.0 million
under the unsecured term loan had a weighted average interest rate of
1.82%
. In 2012, we exercised our one-year extension option to extend the maturity date from April 2012 to April 2013. We intend to retire this loan at the maturity date.
We had an unsecured term loan that bore interest at LIBOR plus a margin ranging from
0.95%
to
1.40%
, based on our leverage ratio. The loan was obtained in February 2008 for the exclusive purpose of acquiring certain Properties from the Starmount Company or its affiliates. We retired the
$127.2 million
unsecured term loan at its maturity in November 2012 with borrowings from our credit facilities.
Letters of Credit
At
December 31, 2012
, we had additional secured and unsecured lines of credit with a total commitment of
$14.0 million
that can only be used for issuing letters of credit. The letters of credit outstanding under these lines of credit totaled
$1.5 million
at
December 31, 2012
.
Covenants and Restrictions
The agreements to the unsecured and secured lines of credit contain, among other restrictions, certain financial covenants including the maintenance of certain financial coverage ratios, minimum net worth requirements, minimum unencumbered asset and interest ratios, maximum secured indebtedness ratios and limitations on cash flow distributions. We believe we were in compliance with all covenants and restrictions at
December 31, 2012
.
The following presents our compliance with key unsecured debt covenant compliance ratios as of
December 31, 2012
:
|
|
|
|
Ratio
|
Required
|
Actual
|
Debt to total asset value
|
< 60%
|
52.6%
|
Ratio of unencumbered asset value to unsecured indebtedness
|
> 1.60x
|
3.13x
|
Ratio of unencumbered NOI to unsecured interest expense
|
> 1.75x
|
11.41x
|
Ratio of EBITDA to fixed charges (debt service)
|
>1.50x
|
2.00x
|
The agreements to the two $600,000 unsecured credit facilities described above, each with the same lead lender, contain default provisions customary for transactions of this nature (with applicable customary grace periods). Additionally, any default in the payment of any recourse indebtedness greater than or equal to $50,000 or any non-recourse indebtedness greater than $150,000 (for the Company's ownership share) of the Company, the Operating Partnership or any Subsidiary, as defined, will constitute an event of default under the agreements to the credit facilities. The credit facilities also restrict our ability to enter into any transaction that could result in certain changes in our ownership or structure as described under the heading “Change of Control/Change in Management” in the agreements to the credit facilities. Our obligations under the agreement also will be unconditionally guaranteed, jointly and severally, by any of our subsidiaries to the extent such subsidiary becomes a material subsidiary and is not otherwise an excluded subsidiary, as defined in the agreement.
The agreement to the $228,000 unsecured term loan described above, with the same lead lender as the unsecured credit facilities, contains default and cross-default provisions customary for transactions of this nature (with applicable customary grace periods) in the event (i) there is a default in the payment of any indebtedness owed by the Company to any institution which is a part of the lender group for the unsecured term loan, or (ii) there is any other type of default with respect to any indebtedness owed by the Company to any institution which is a part of the lender group for the unsecured term loan and such lender accelerates the payment of the indebtedness owed to it as a result of such default. The unsecured term loan agreement provides that, upon the occurrence and continuation of an event of default, payment of all amounts outstanding under the unsecured term loan and those facilities with which these agreements reference cross-default provisions may be accelerated and the lenders' commitments may be terminated. Additionally, any default in the payment of any recourse indebtedness greater than 1% of gross asset value or default in the payment of any non-recourse indebtedness greater than 3% of gross asset value
of the Company, the Operating Partnership and Significant Subsidiaries, as defined, regardless of whether the lending institution is a part of the lender groups for the unsecured term loan, will constitute an event of default under the agreements to the unsecured term loan.
Mortgages on Operating Properties
In the fourth quarter of 2012, a subsidiary of CBL/T-C, a joint venture in which we own a 50% interest, obtained a
10
-year
$190.0 million
non-recourse loan, secured by West County Center in Des Peres, MO, that bears a fixed interest rate of
3.4%
and matures in
December 2022
. Net proceeds of
$189.7 million
were used to retire the outstanding borrowings of
$142.2 million
under the previous loan and the excess proceeds were distributed 50/50 to us and our partner. Additionally, we retired a non-recourse loan with a principal balance of
$106.9 million
, secured by Monroeville Mall in Monroeville, PA, with borrowings from our credit facilities. The loan was scheduled to mature in
January 2013
.
In the fourth quarter of 2012, we retired a non-recourse loan with a principal balance of
$106.9 million
, secured by Monroeville Mall in Monroeville, PA, with borrowings from our credit facilities. The loan was scheduled to mature in
January 2013
.
During the third quarter of 2012, we retired two loans totaling $122.0 million, each of which was secured by a regional mall, with borrowings from our credit facilities. The loans were scheduled to mature in 2012. We recorded a gain on extinguishment of debt of
$0.2 million
related to the early retirement of this debt. Additionally, we retired a
$2.0 million
land loan, secured by The Forum at Grandview in Madison, MS, with borrowings from our credit facilities. The loan was scheduled to mature in September 2012.
Also in the third quarter of 2012, Gulf Coast, a joint venture in which we own a 50% interest, closed on a three-year
$7.0 million
loan with a bank, secured by the third phase expansion of Gulf Coast Town Center, a shopping center located in Ft. Myers, FL. Interest on the loan is at
LIBOR plus a margin of 2.5%
. We have guaranteed
100%
of this loan. Proceeds from the loan were distributed to us in accordance with the terms of the joint venture agreement and we used these funds to reduce the balance on our credit facilities.
During the second quarter of 2012, we closed on five ten-year non-recourse CMBS loans totaling
$342.2 million
. The loans bear interest at fixed rates ranging from
4.750%
to
5.099%
with a total weighted average interest rate of
4.946%
. These loans are secured by WestGate Mall in Spartanburg, SC; Southpark Mall in Colonial Heights, VA; Jefferson Mall in Louisville, KY; Fashion Square Mall in Saginaw, MI and Arbor Place in Douglasville, GA. Proceeds were used to pay down our credit facilities and to retire an existing loan with a balance of
$30.8 million
secured by Southpark Mall.
Additionally, during the second quarter of 2012, we closed on a
$22.0 million
ten
-year non-recourse loan with an insurance company at a fixed interest rate of
5.00%
secured by CBL Centers I and II in Chattanooga, TN. The new loan was used to pay down our credit facilities, which had been used in April 2012 and February 2012 to retire the balances on the maturing loans on CBL Centers II and I which had principal outstanding balances of
$9.1 million
and
$12.8 million
, respectively.
In the second quarter of 2012, we entered into a
75%
/
25%
joint venture, Atlanta Outlet Shoppes, LLC, with a third party to develop, own and operate The Outlet Shoppes at Atlanta, an outlet center development located in Woodstock, GA, In August 2012, the joint venture closed on a construction loan with a maximum capacity of
$69.8 million
that bears interest at
LIBOR plus a margin of 275 basis points
. The loan matures in
August 2015
and has
two
one-year extensions available, which are at our option. We have guaranteed
100%
of this loan.
Also during the second quarter of 2012, we closed on the extension and modification of a recourse loan secured by Statesboro Crossing in Statesboro, GA to extend the maturity date to February 2013 and reduce the amount available under the loan from
$20.9 million
to equal the outstanding balance of
$13.6 million
. The interest rate remained at
one-month LIBOR plus a spread of 1.00%
. The loan was retired at maturity with borrowings from our credit facilities.
During the first quarter of 2012, we closed on a
$73.0 million
ten
-year non-recourse CMBS loan secured by Northwoods Mall in Charleston, SC, which bears a fixed interest rate of
5.075%
. Proceeds were used to reduce outstanding balances on our credit facilities.
During the first quarter of 2012, YTC, a joint venture in which we own a 50% interest, closed on a
$38.0 million
10-year
non-recourse loan, secured by York Town Center in York, PA, which bears interest at a fixed rate of
4.9%
and matures in
February 2022
. Proceeds from the new loan, plus cash on hand, were used to retire an existing loan of
$39.4 million
that was scheduled to mature in
March 2012
.
Also during the first quarter of 2012, Port Orange, a joint venture in which we own a 50% interest, closed on the extension and modification of a construction loan secured by The Pavilion at Port Orange in Port Orange, FL, to extend the maturity date to
March 2014
, remove a
1%
LIBOR floor and reduce the capacity from
$98.9 million
to
$65.0 million
. Port Orange paid
$3.3
million
to reduce the outstanding balance on the loan to the new capacity amount. There is a
one
-year extension option remaining on the loan, which is at the joint venture's election, for an outside maturity date of
March 2015
. Interest on the loan is at
LIBOR plus a margin of 3.5%
. We have guaranteed
100%
of the construction loan.
Also during the first quarter of 2012, we retired
14
operating property loans with an aggregate principal balance of
$381.6 million
that were secured by Arbor Place, The Landing at Arbor Place, Fashion Square, Hickory Hollow, The Courtyard at Hickory Hollow Mall, Jefferson Mall, Massard Crossing, Northwoods Mall, Old Hickory Mall, Pemberton Plaza, Randolph Mall, Regency Mall, WestGate Mall and Willowbrook Plaza with borrowings from our credit facilities. See
Note 4
to the consolidated financial statements related to the sale of Massard Crossing, Hickory Hollow Mall and Willowbrook Plaza in 2012.
In the first quarter of 2012, the lender of the non-recourse mortgage loan secured by Columbia Place in Columbia, SC notified us that the loan had been placed in default. Columbia Place generates insufficient income levels to cover the debt service on the mortgage, which had a balance of
$27.3 million
at
December 31, 2012
, and a contractual maturity date of September 2013. The lender on the loan receives the net operating cash flows of the property each month in lieu of scheduled monthly mortgage payments.
Interest Rate Hedging Instruments
During the first quarter of 2012, we entered into an interest rate cap agreement with an initial notional amount of $125.0 million, amortizing to $122.4 million, to hedge the risk of changes in cash flows on the borrowings of one of our Properties equal to the cap notional. The interest rate cap protects us from increases in the hedged cash flows attributable to overall changes in 3-month LIBOR above the strike rate of the cap on the debt. The strike rate associated with the interest rate cap is 5.0%. The cap matures in January 2014.
The following table provides further information related to each of our interest rate derivatives that were designated as cash flow hedges of interest rate risk as of
December 31, 2012
and
2011
(dollars in thousands):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Instrument Type
|
|
Location in
Consolidated
Balance Sheet
|
|
Outstanding
Notional
Amount
|
|
Designated
Benchmark
Interest
Rate
|
|
Strike
Rate
|
|
Fair
Value at
12/31/12
|
|
Fair
Value at
12/31/11
|
|
Maturity
Date
|
Cap
|
|
Intangible lease assets
and other assets
|
|
$ 123,875
(amortizing
to $122,375)
|
|
3-month
LIBOR
|
|
5.000
|
%
|
|
$
|
—
|
|
|
$
|
—
|
|
|
January 2014
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Pay fixed/ Receive
variable Swap
|
|
Accounts payable and
accrued liabilities
|
|
$ 55,057
(amortizing
to $48,337)
|
|
1-month
LIBOR
|
|
2.149
|
%
|
|
$
|
(2,775
|
)
|
|
$
|
(2,674
|
)
|
|
April 2016
|
Pay fixed/ Receive
variable Swap
|
|
Accounts payable and
accrued liabilities
|
|
$ 34,469
(amortizing
to $30,276)
|
|
1-month
LIBOR
|
|
2.187
|
%
|
|
(1,776
|
)
|
|
(1,725
|
)
|
|
April 2016
|
Pay fixed/ Receive
variable Swap
|
|
Accounts payable and
accrued liabilities
|
|
$ 12,887
(amortizing
to $11,313)
|
|
1-month
LIBOR
|
|
2.142
|
%
|
|
(647
|
)
|
|
(622
|
)
|
|
April 2016
|
Pay fixed/ Receive
variable Swap
|
|
Accounts payable and
accrued liabilities
|
|
$ 11,472
(amortizing
to $10,083)
|
|
1-month
LIBOR
|
|
2.236
|
%
|
|
(607
|
)
|
|
(596
|
)
|
|
April 2016
|
|
|
|
|
|
|
|
|
|
|
$
|
(5,805
|
)
|
|
$
|
(5,617
|
)
|
|
|
Equity
In October 2012, we completed an underwritten public offering of 6,900,000 depositary shares, each representing 1/10
th
of a share of our Series E Preferred Stock at $25.00 per share plus accrued dividends. We received net proceeds from the offering of approximately $166.6 million after deducting the underwriting discount and offering expenses. Net proceeds from this offering were used to redeem all our outstanding Series C Shares with a liquidation preference of $115.0 million and $0.9 million related to accrued and unpaid dividends for an aggregate redemption amount of $115.9 million. Additional proceeds were used to reduce outstanding balances on our secured credit facilities. We will pay cumulative dividends on the Series E Preferred Stock from the date of original issuance in the amount of $1.65625 per depositary share each year, which is equivalent to 6.625% of the $25.00 liquidation preference per depositary share. We may not redeem the Series E Preferred Stock before October 12, 2017, except in limited circumstances to preserve our REIT status or in connection with a change of control. On or after October 12, 2017, we
may, at our option, redeem the Series E Preferred Stock in whole at any time or in part from time to time by paying $25.00 per depositary share, plus any accrued and unpaid dividends up to, but not including, the date of redemption. The Series E Preferred Stock generally has no stated maturity and will not be subject to any sinking fund or mandatory redemption. The Series E Preferred Stock is not convertible into any of the Company's securities, except under certain circumstances in connection with a change of control. Owners of the depositary shares representing Series E Preferred Stock generally have no voting rights except under dividend default.
On October 5, 2012, we called for redemption all 460,000 Series C Shares and the related outstanding depositary shares, each representing 1/10
th
of a Series C Share. The aggregate redemption amount of $115.9 million was paid on November 5, 2012. We recorded a charge of $3.8 million in the fourth quarter of 2012 to write off direct issuance costs related to the Series C Shares and underlying depositary shares.
During the year ended
December 31, 2012
, we paid dividends of $177.5 million to holders of our common stock and our preferred stock, as well as $65.6 million in distributions to the noncontrolling interest investors in our Operating Partnership and other consolidated subsidiaries.
We paid first, second and third quarter
2012
cash dividends on our common stock of
$0.22
per share on April 17
th
, July 17
th
and October 16
th
2012
, respectively. On November 28, 2012, we announced a fourth quarter cash dividend of
$0.22
per share that was paid on January 16, 2013. Future dividends payable will be determined by our Board of Directors based upon circumstances at the time of declaration.
As a publicly traded company, we have access to capital through both the public equity and debt markets. We currently have a shelf registration statement on file with the Securities and Exchange Commission authorizing us to publicly issue senior and/or subordinated debt securities, shares of preferred stock (or depositary shares representing fractional interests therein), shares of common stock, warrants or rights to purchase any of the foregoing securities, and units consisting of two or more of these classes or series of securities. There is no limit to the offering price or number of securities that we may issue under this shelf registration statement.
Our strategy is to maintain a conservative debt-to-total-market capitalization ratio in order to enhance our access to the broadest range of capital markets, both public and private. Based on our share of total consolidated and unconsolidated debt and the market value of equity, our debt-to-total-market capitalization (debt plus market value of equity) ratio was 53.8% at
December 31, 2012
, compared to 59.7% at
December 31, 2011
. Our debt-to-market capitalization ratio at
December 31, 2012
was computed as follows (in thousands, except stock prices):
|
|
|
|
|
|
|
|
|
|
|
|
|
Shares
Outstanding
|
|
Stock Price
(1)
|
|
Value
|
Common stock and operating partnership units
|
190,855
|
|
|
$
|
21.21
|
|
|
$
|
4,048,035
|
|
7.375% Series D Cumulative Redeemable Preferred Stock
|
1,815
|
|
|
250.00
|
|
|
453,750
|
|
6.625% Series E Cumulative Redeemable Preferred Stock
|
690
|
|
|
250.00
|
|
|
172,500
|
|
Total market equity
|
|
|
|
|
|
|
4,674,285
|
|
Company’s share of total debt
|
|
|
|
|
|
|
5,445,207
|
|
Total market capitalization
|
|
|
|
|
|
|
$
|
10,119,492
|
|
Debt-to-total-market capitalization ratio
|
|
|
|
|
|
|
53.8
|
%
|
|
|
(1)
|
Stock price for common stock and Operating Partnership units equals the closing price of our common stock on December 31, 2012. The
|
stock prices for the preferred stock represent the liquidation preference of each respective series of preferred stock.
Contractual Obligations
The following table summarizes our significant contractual obligations as of
December 31, 2012
(dollars in thousands):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Payments Due By Period
|
|
Total
|
|
Less Than 1
Year
|
|
1-3
Years
|
|
3-5
Years
|
|
More Than 5 Years
|
Long-term debt:
|
|
|
|
|
|
|
|
|
|
Total consolidated debt service
(1)
|
$
|
5,942,128
|
|
|
$
|
733,648
|
|
|
$
|
1,671,749
|
|
|
$
|
1,589,818
|
|
|
$
|
1,946,913
|
|
Noncontrolling interests' share in other consolidated subsidiaries
|
(108,317
|
)
|
|
(5,614
|
)
|
|
(11,279
|
)
|
|
(52,627
|
)
|
|
(38,797
|
)
|
Our share of unconsolidated affiliates debt service
(2)
|
928,851
|
|
|
162,101
|
|
|
404,046
|
|
|
189,061
|
|
|
173,643
|
|
Our share of total debt service obligations
|
6,762,662
|
|
|
890,135
|
|
|
2,064,516
|
|
|
1,726,252
|
|
|
2,081,759
|
|
|
|
|
|
|
|
|
|
|
|
Operating leases:
(3)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Ground leases on consolidated properties
|
32,372
|
|
|
775
|
|
|
1,573
|
|
|
1,613
|
|
|
28,411
|
|
|
|
|
|
|
|
|
|
|
|
Purchase obligations:
(4)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Construction contracts on consolidated properties
|
6,491
|
|
|
6,491
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
|
Total contractual obligations
|
$
|
6,801,525
|
|
|
$
|
897,401
|
|
|
$
|
2,066,089
|
|
|
$
|
1,727,865
|
|
|
$
|
2,110,170
|
|
|
|
(1)
|
Represents principal and interest payments due under the terms of mortgage and other indebtedness and includes $1,218,183 of variable-rate debt service on ten operating Properties, one construction loan, one secured credit facility and two unsecured credit facilities. The construction loan and credit facilities do not require scheduled principal payments. The future interest payments are projected based on the interest rates that were in effect at
December 31, 2012
. See
to the consolidated financial statements for additional information regarding the terms of long-term debt.
|
|
|
(2)
|
Includes $137,914 of variable-rate debt service. Future contractual obligations have been projected using the same assumptions as used in (1) above.
|
|
|
(3)
|
Obligations where we own the buildings and improvements, but lease the underlying land under long-term ground leases. The maturities of these leases range from 2014 to 2089 and generally provide for renewal options.
|
|
|
(4)
|
Represents the remaining balance to be incurred under construction contracts that had been entered into as of
December 31, 2012
, but were not complete. The contracts are primarily for development of Properties.
|
Capital Expenditures
Deferred maintenance expenditures are generally billed to tenants as common area maintenance expense, and most are recovered over a 5 to 15-year period. Renovation expenditures are primarily for remodeling and upgrades of malls, of which a portion is recovered from tenants over a 5 to 15-year period. We recover these costs through fixed amounts with annual increases or pro rata cost reimbursements based on the tenant’s occupied space. The following table summarizes these capital expenditures, including our share of unconsolidated affiliates' capital expenditures for the year ended
December 31, 2012
compared to
2011
(dollars in thousands):
|
|
|
|
|
|
|
|
|
|
Year Ended
December 31,
|
|
2012
|
|
2011
|
Tenant allowances
(1)
|
$
|
56,657
|
|
|
$
|
46,403
|
|
|
|
|
|
Renovations
|
28,106
|
|
|
23,300
|
|
|
|
|
|
Deferred maintenance:
|
|
|
|
Parking lot and parking lot lighting
|
18,163
|
|
|
8,793
|
|
Roof repairs and replacements
|
8,427
|
|
|
3,312
|
|
Other capital expenditures
|
11,567
|
|
|
8,707
|
|
Total deferred maintenance
|
38,157
|
|
|
20,812
|
|
|
|
|
|
Total capital expenditures
|
$
|
122,920
|
|
|
$
|
90,515
|
|
|
|
|
(1)
|
Tenant allowances primarily relate to new leases. Tenant allowances related to renewal leases were not material for the periods presented.
|
We capitalized overhead of $3.2 million and $4.0 million during
2012
and
2011
, respectively. We capitalized $2.7 million and $5.0 million of interest during
2012
and
2011
, respectively.
We continue to make it a priority to reinvest in our Properties in order to enhance their dominant position in the market. In 2012, we completed upgrades at Cross Creek Mall in Fayetteville, NC; Post Oak Mall in College Station, TX; Turtle Creek Mall in Hattiesburg, MS and Mall del Norte in Laredo, TX. Our 2013 renovation program includes upgrades at four of our Properties. Renovations are scheduled to be completed in 2013 at Friendly Center in Greensboro, NC; Greenbrier Mall in Chesapeake, VA; Acadiana Mall in Lafayette, LA and Northgate Mall in Chattanooga, TN. Friendly Center's renovation will include updated walkway canopies and landscaping. Greenbrier Mall will receive a newly designed food court with new tables and chairs in addition to landscape improvements and other upgrades. The upgrades at Acadiana Mall will include updated entrances, a remodeled food court, new landscaping and other enhancements. The renovation at Northgate Mall will include exterior enhancements, new flooring and soft seating areas as well as ceiling and lighting upgrades. Our total anticipated net investment in these renovations is approximately $24.7 million.
The terms of the joint venture that we formed with TIAA-CREF require us to fund certain capital expenditures related to parking decks at West County Center of approximately $26.4 million. As of
December 31, 2012
, we had funded $7.3 million of this amount leaving approximately $19.1 million to be funded.
Annual capital expenditures budgets are prepared for each of our Properties that are intended to provide for all necessary recurring and non-recurring capital expenditures. We believe that property operating cash flows, which include reimbursements from tenants for certain expenses, will provide the necessary funding for these expenditures.
Developments and Expansions
The following tables summarize our development projects as of
December 31, 2012
:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Properties Opened During the Year Ended December 31, 2012
|
|
|
|
|
|
|
|
(Dollars in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
Project
Square
Feet
|
|
|
|
|
|
|
Property
|
|
Location
|
|
|
Total
Cost
(1)
|
|
Cost to
Date
(2)
|
|
Date Opened
|
|
Initial
Unleveraged
Yield
|
Community Center:
|
|
|
|
|
|
|
|
|
|
|
|
|
Waynesville Commons
|
|
Waynesville, NC
|
|
127,585
|
|
|
$
|
9,987
|
|
|
$
|
9,505
|
|
|
October-12
|
|
10.6%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Community Center Expansion:
|
|
|
|
|
|
|
|
|
|
|
|
|
The Forum at Grandview - Phase II
(3)
|
|
Madison, MS
|
|
83,060
|
|
|
$
|
16,826
|
|
|
$
|
13,119
|
|
|
April-12
|
|
7.6%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mall /Open-Air Center Expansion:
|
|
|
|
|
|
|
|
|
|
|
|
|
The Shoppes at Southaven Towne Center - Phase I
|
|
Southaven, MS
|
|
15,557
|
|
|
$
|
1,828
|
|
|
$
|
1,614
|
|
|
November-12
|
|
16.4%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mall Redevelopment:
|
|
|
|
|
|
|
|
|
|
|
|
|
Foothills Mall/Plaza - Carmike Cinemas
|
|
Maryville, TN
|
|
45,276
|
|
|
$
|
8,337
|
|
|
$
|
8,718
|
|
|
March-12
|
|
7.3%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Outlet Center Expansion:
|
|
|
|
|
|
|
|
|
|
|
|
|
The Outlet Shoppes at Oklahoma City - Phase II
(3)
|
|
Oklahoma City, OK
|
|
27,850
|
|
|
$
|
6,668
|
|
|
$
|
5,055
|
|
|
November-12
|
|
11.4%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Properties Opened
|
|
|
|
299,328
|
|
|
$
|
43,646
|
|
|
$
|
38,011
|
|
|
|
|
|
|
|
(1)
|
Total cost is presented net of reimbursements to be received.
|
|
|
(2)
|
Cost to date does not reflect reimbursements until they are received.
|
|
|
(3)
|
These Properties are 75/25 joint ventures. Total cost and cost to date are reflected at 100%.
|
In the fourth quarter of 2012, we opened Waynesville Commons, our newest community center development in Waynesville, NC. The 100% leased center is anchored by Belk, PetSmart and Michaels. In the second quarter of 2012, we also celebrated the opening of the second phase of The Forum at Grandview, our 75/25 joint venture community center development in Madison, MS, which is anchored by Michaels, ULTA, HomeGoods and Petco.
In the fourth quarter of 2012, we completed the first phase of an expansion at Southaven Town Center, an open-air center located in Southaven, MS. The project is fully leased to Men's Wearhouse, College Station and Rue 21.
In the first quarter of 2012, Carmike Cinemas opened a state-of-the art 12-screen movie theater complex at Foothills Mall in Maryville, TN.
We also opened the second phase of The Outlet Shoppes at Oklahoma City in the last quarter of 2012. The outlet center is 100% leased and second phase expansion includes stores such as Ann Taylor, LOFT, Waterford, Lucky Jeans and Coach Men.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Properties Under Development at December 31, 2012
|
|
|
|
|
|
|
|
|
|
|
(Dollars in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
Project
Square
Feet
|
|
|
|
|
|
|
Property
|
|
Location
|
|
|
Total
Cost
(1)
|
|
Cost to
Date
(2)
|
|
Expected
Opening Date
|
|
Initial
Unleveraged
Yield
|
Community Center:
|
|
|
|
|
|
|
|
|
|
|
|
|
The Crossings at Marshalls Creek
|
|
Middle Smithfield, PA
|
|
104,525
|
|
|
$
|
18,983
|
|
|
$
|
11,312
|
|
|
Summer-13
|
|
9.8%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mall Expansion:
|
|
|
|
|
|
|
|
|
|
|
|
|
Volusia Mall - Restaurant District
|
|
Daytona Beach, FL
|
|
28,000
|
|
|
$
|
8,951
|
|
|
$
|
4,107
|
|
|
Fall-13
|
|
11.0%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mall Redevelopments:
|
|
|
|
|
|
|
|
|
|
|
|
|
Monroeville Mall - JC Penney/Cinemark
|
|
Pittsburgh, PA
|
|
464,792
|
|
|
$
|
26,178
|
|
|
$
|
8,784
|
|
|
October-12/Winter-13
|
|
7.6%
|
Southpark Mall - Dick's Sporting Goods
|
|
Colonial Heights, VA
|
|
91,770
|
|
|
9,891
|
|
|
860
|
|
|
Fall-13
|
|
6.6%
|
|
|
|
|
556,562
|
|
|
$
|
36,069
|
|
|
$
|
9,644
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Outlet Center:
|
|
|
|
|
|
|
|
|
|
|
|
|
The Outlet Shoppes at Atlanta
(3)
|
|
Woodstock, GA
|
|
370,456
|
|
|
$
|
80,490
|
|
|
$
|
31,468
|
|
|
July-13
|
|
10.0%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Under Development
|
|
|
|
1,059,543
|
|
|
$
|
144,493
|
|
|
$
|
56,531
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
Total cost is presented net of reimbursements to be received.
|
|
|
(2)
|
Cost to date does not reflect reimbursements until they are received.
|
|
|
(3)
|
This Property is a 75/25 joint venture. Total cost and cost to date are reflected at 100%.
|
Construction continues at The Crossings at Marshalls Creek, a community center development, which will be anchored by Price Chopper super market, Rite Aid, STS Tire and Auto Centers, and Family Dollar. The project is approximately 85% leased or committed with a grand opening scheduled for summer 2013.
We continue to invest in our mall Properties through several expansion and redevelopment projects slated for completion in 2013. A 28,000-square-foot expansion to add a restaurant district at Volusia Mall in Daytona Beach commenced construction in late 2012. At Monroeville Mall, JC Penney opened their new 110,000-square-foot prototype store in October 2012, relocating from their existing store in the mall. Their former building is being redeveloped into a new 12-screen Cinemark Theatre, anticipated to open in fall 2013. We also began construction in the fourth quarter of 2012 on the redevelopment of a recently vacated Dillard's location at Southpark Mall in Colonial Heights, VA. The store will be redeveloped for a 56,000-square-foot Dick's Sporting Goods. The project may also feature a selection of specialty stores and restaurants with a grand opening planned in summer 2013.
Construction is in progress on The Outlet Shoppes at Atlanta. The 370,500-square-foot project is approximately 92% leased or committed with retailers including Saks Fifth Avenue OFF 5
TH
, Nike, Brooks Brothers, Under Armour, J.Crew and Fossil. This project is a 75/25 joint venture scheduled to open in July 2013.
We hold options to acquire certain development properties owned by third parties. Except for the projects presented above, we do not have any other material capital commitments as of
December 31, 2012
.
Acquisitions
In
December 2012
, we acquired the remaining
40.0%
interests in Imperial Valley Mall, L.P., Imperial Valley Peripheral, L.P. and Imperial Valley Commons, L.P. in El Centro, CA from our joint venture partner. The interests were acquired for total consideration of
$36.5 million
which consists of
$15.5 million
in cash and
$21.0 million
related to our assumption of the joint venture partner's share of the loan secured by Imperial Valley Mall.
In
December 2012
, we acquired a
49.0%
joint venture interest in Kirkwood Mall in Bismarck, ND. We paid cash of
$39.8 million
for our
49.0%
share, which was based on a total value of
$121.5 million
including a
$40.4 million
non-recourse loan. We executed an agreement to acquire the remaining
51.0%
interest within 90 days subject to the lender's approval to assume the loan, which bears interest of
5.75%
and matures in
April 2018
.
In
May 2012
, we
acquired Dakota Square Mall in Minot, ND. The purchase price of
$91.5 million
consisted of
$32.5 million
in cash and the assumption of a
$59.0 million
non-recourse loan that bears interest at a fixed rate of
6.23%
and matures
in
November 2016
.
In
April 2012
, we exercised our rights with our noncontrolling interest partner under the terms of a mezzanine loan agreement with the borrower, which owned The Outlet Shoppes at Gettysburg in Gettysburg, PA, to convert the mezzanine loan into a member interest in the outlet shopping center. After conversion, we own a
50.0%
interest in the outlet center. The investment of
$24.8 million
consisted of a
$4.5 million
converted mezzanine loan and the assumption of
$20.3 million
of debt. The
$40.6 million
of debt, of which our share is
50.0%
, bears interest at a fixed rate of
5.87%
and matures in
February 2016
.
In
April 2012
, we acquired a
75.0%
joint venture interest in The Outlet Shoppes at El Paso, an outlet shopping center located in El Paso, TX for
$31.6 million
and a
50.0%
joint venture interest in outparcel land adjacent to The Outlet Shoppes at El Paso for
$3.9 million
for a total of
$35.5 million
. The amount paid for our
75.0%
and
50.0%
interests was based on a total value of
$116.8 million
including a non-recourse mortgage loan of
$66.9 million
, which bears interest at a fixed rate of
7.06%
and matures in
December 2017
. The entity that owned The Outlet Shoppes at El Paso used a portion of the cash proceeds to repay a
$9.2 million
mezzanine loan provided by us. After considering the repayment of the mezzanine loan to us, the net consideration paid by us in connection with this transaction was
$28.6 million
.
Dispositions
During 2012, we completed the sale of two malls, four community centers and eight parcels of land for aggregate net proceeds of
$77.0 million
, which were used to reduce the outstanding borrowings on our credit facilities.
Off-Balance Sheet Arrangements
Unconsolidated Affiliates
We have ownership interests in
16
unconsolidated affiliates as of
December 31, 2012
, that are described in
Note 5
to the consolidated financial statements. The unconsolidated affiliates are accounted for using the equity method of accounting and are reflected in the consolidated balance sheets as “Investments in Unconsolidated Affiliates.” The following are circumstances when we may consider entering into a joint venture with a third party:
|
|
▪
|
Third parties may approach us with opportunities in which they have obtained land and performed some pre-development activities, but they may not have sufficient access to the capital resources or the development and leasing expertise to bring the project to fruition. We enter into such arrangements when we determine such a project is viable and we can achieve a satisfactory return on our investment. We typically earn development fees from the joint venture and provide management and leasing services to the property for a fee once the property is placed in operation.
|
|
|
▪
|
We determine that we may have the opportunity to capitalize on the value we have created in a Property by selling an interest in the Property to a third party. This provides us with an additional source of capital that can be used to develop or acquire additional real estate assets that we believe will provide greater potential for growth. When we retain an interest in an asset rather than selling a 100% interest, it is typically because this allows us to continue to manage the Property, which provides us the ability to earn fees for management, leasing, development and financing services provided to the joint venture.
|
Preferred Joint Venture Units
We consolidate our investment in a joint venture, CWJV, with Westfield. The terms of the joint venture agreement require that CWJV pay an annual preferred distribution at a rate of 5.0%, which increases to 6.0% on July 1, 2013, on the preferred liquidation value of the perpetual preferred joint venture units (“PJV units”) of CWJV that are held by Westfield. Westfield has the right to have all or a portion of the PJV units redeemed by CWJV with either cash or property owned by CWJV, in each case for a net equity amount equal to the preferred liquidation value of the PJV units. At any time after January 1, 2013, Westfield may propose that CWJV acquire certain qualifying property that would be used to redeem the PJV units at their preferred liquidation value. If CWJV does not redeem the PJV units with such qualifying property (a “Preventing Event”), then the annual preferred distribution rate on the PJV units increases to 9.0% beginning July 1, 2013. We will have the right, but not the obligation, to offer to redeem the PJV units from January 31, 2013 through January 31, 2015 at their preferred liquidation value, plus accrued and unpaid distributions. We amended the joint venture agreement with Westfield in September 2012 to provide that, if we exercise our right to offer to redeem the PJV units on or before August 1, 2013, then the preferred liquidation value will be reduced by $10.0 million so long as Westfield does not reject the offer and the redemption closes on or before September 30, 2013. If we fail to make such an offer, the annual preferred distribution rate on the PJV units increases to 9.0% for the period from July 1, 2013 through June 30, 2016, at which time it decreases to 6.0% if a Preventing Event has not occurred. If, upon redemption of the PJV
units, the fair value of our common stock is greater than $32.00 per share, then such excess (but in no case greater than $26.0 million in the aggregate) shall be added to the aggregate preferred liquidation value payable on account of the PJV units. We account for this contingency using the method prescribed for earnings or other performance measure contingencies. As such, should this contingency result in additional consideration to Westfield, we will record the current fair value of the consideration issued as a purchase price adjustment at the time the consideration is paid or payable.
Guarantees
We may guarantee the debt of a joint venture primarily because it allows the joint venture to obtain funding at a lower cost than could be obtained otherwise. This results in a higher return for the joint venture on its investment, and a higher return on our investment in the joint venture. We may receive a fee from the joint venture for providing the guaranty. Additionally, when we issue a guaranty, the terms of the joint venture agreement typically provide that we may receive indemnification from the joint venture partner or have the ability to increase our ownership interest.
We own a parcel of land in Lee's Summit, MO that we are ground leasing to a third party development company. The third party developed and operates a shopping center on the land parcel. We have guaranteed
27%
of the third party’s construction loan and bond line of credit (the “loans”) of which the maximum guaranteed amount, representing
27%
of capacity, is approximately
$15.2 million
. In the third quarter of 2012, the loans were modified and extended to December 2012. In August 2012, proceeds from a bond issuance were applied to reduce
$10.4 million
of the outstanding balance on the bond line of credit. Additionally,
$1.0 million
of the construction loan was repaid. The total amount outstanding at
December 31, 2012
on the loans was
$49.3 million
of which we have guaranteed
$13.3 million
. We included an obligation of
$0.2 million
as of
December 31, 2012
and
2011
in the accompanying consolidated balance sheets to reflect the estimated fair value of the guaranty. The loan was in default at December 31, 2012 because it was not refinanced at the scheduled maturity date in December 2012. The third party developer is working with the lender to extend the maturity date of the loan. We have not increased our accrual for the contingent obligation as we do not believe that this contingent obligation is probable.
We have guaranteed
100%
of the construction and land loans of West Melbourne I, LLC (“West Melbourne”), an unconsolidated affiliate in which we own a
50%
interest, of which the maximum guaranteed amount is
$45.4 million
. West Melbourne developed and operates Hammock Landing, a community center in West Melbourne, FL. The total amount outstanding on the loans at
December 31, 2012
was
$45.4 million
. The guaranty will expire upon repayment of the debt. The land loan, and the construction loan, each representing
$2.9 million
and
$42.4 million
, respectively, of the amount outstanding at
December 31, 2012
, mature in November 2013. The construction loan has a one-year extension option available. We included an obligation of
$0.5 million
in the accompanying consolidated balance sheets as of
December 31, 2012
and
2011
to reflect the estimated fair value of this guaranty.
We have guaranteed
100%
of the construction loan of Port Orange, an unconsolidated affiliate in which we own a
50%
interest, of which the maximum guaranteed amount is
$63.0 million
. Port Orange developed and operates The Pavilion at Port Orange, a community center in Port Orange, FL. The total amount outstanding at
December 31, 2012
on the loan was
$63.0 million
. The guaranty will expire upon repayment of debt. The loan matures in March 2014 and has a one-year extension option available. We included an obligation of
$1.0 million
in the accompanying consolidated balance sheets as of
December 31, 2012
and
2011
to reflect the estimated fair value of this guaranty.
We have guaranteed the lease performance of YTC, an unconsolidated affiliate in which we own a
50%
interest, under the terms of an agreement with a third party that owns property as part of York Town Center. Under the terms of that agreement, YTC is obligated to cause performance of the third party’s obligations as landlord under its lease with its sole tenant, including, but not limited to, provisions such as co-tenancy and exclusivity requirements. Should YTC fail to cause performance, then the tenant under the third party landlord’s lease may pursue certain remedies ranging from rights to terminate its lease to receiving reductions in rent. We have guaranteed YTC’s performance under this agreement up to a maximum of $
22.0 million
, which decreases by $
0.8 million
annually until the guaranteed amount is reduced to
10.0 million
. The guaranty expires on December 31, 2020. The maximum guaranteed obligation was
$17.2 million
as of
December 31, 2012
. We entered into an agreement with our joint venture partner under which the joint venture partner has agreed to reimburse us
50%
of any amounts we are obligated to fund under the guaranty. We did not include an obligation for this guaranty because we determined that the fair value of the guaranty was not material as of
December 31, 2012
and
2011
.
In July 2012, we guaranteed
100%
of a term loan for Gulf Coast, an unconsolidated affiliate in which we own a
50%
interest, of which the maximum guaranteed amount is
$6.8 million
. The loan is for the third phase expansion of Gulf Coast Town Center, a shopping center located in Ft. Myers, FL. The total amount outstanding as of
December 31, 2012
on the loan was
$6.8 million
. The guaranty will expire upon repayment of the debt. The loan matures in
July 2015
. We did not record an obligation for this guaranty because we determined that the fair value of the guaranty was not material as of
December 31, 2012
.
Our guarantees and the related accounting are more fully described in
Note 14
to the consolidated financial statements.
Critical Accounting Policies and Estimates
Our consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”). In connection with the preparation of our financial statements, we are required to make assumptions and estimates about future events, and apply judgments that affect the reported amounts of assets, liabilities, revenues, expenses and the related disclosures. We base our assumptions, estimates and judgments on historical experience, current trends and other factors that management believes to be relevant at the time our consolidated financial statements are prepared. On a regular basis, we review the accounting policies, assumptions, estimates and judgments to ensure that our financial statements are presented fairly and in accordance with GAAP. However, because future events and their effects cannot be determined with certainty, actual results could differ from our assumptions and estimates, and such differences could be material.
An accounting policy is deemed to be critical if it requires an accounting estimate to be made based on assumptions about matters that are highly uncertain at the time the estimate is made and if different estimates that are reasonably likely to occur could materially impact the financial statements. Management believes that the following critical accounting policies discussed in this section reflect its more significant estimates and assumptions used in preparation of the consolidated financial statements. We have reviewed these critical accounting estimates and related disclosures with the Audit Committee of our Board of Directors. For a discussion of our significant accounting policies, see
Note 2
of the Notes to Consolidated Financial Statements, included in Item 8 of this Annual Report on Form 10-K.
Revenue Recognition
Minimum rental revenue from operating leases is recognized on a straight-line basis over the initial terms of the related leases. Certain tenants are required to pay percentage rent if their sales volumes exceed thresholds specified in their lease agreements. Percentage rent is recognized as revenue when the thresholds are achieved and the amounts become determinable.
We receive reimbursements from tenants for real estate taxes, insurance, common area maintenance, and other recoverable operating expenses as provided in the lease agreements. Tenant reimbursements are recognized as revenue in the period the related operating expenses are incurred. Tenant reimbursements related to certain capital expenditures are billed to tenants over periods of 5 to 15 years and are recognized as revenue in accordance with underlying lease terms.
We receive management, leasing and development fees from third parties and unconsolidated affiliates. Management fees are charged as a percentage of revenues (as defined in the management agreement) and are recognized as revenue when earned. Development fees are recognized as revenue on a pro rata basis over the development period. Leasing fees are charged for newly executed leases and lease renewals and are recognized as revenue when earned. Development and leasing fees received from unconsolidated affiliates during the development period are recognized as revenue to the extent of the third-party partners’ ownership interest. Fees to the extent of our ownership interest are recorded as a reduction to our investment in the unconsolidated affiliate.
Gains on sales of real estate assets are recognized when it is determined that the sale has been consummated, the buyer’s initial and continuing investment is adequate, our receivable, if any, is not subject to future subordination, and the buyer has assumed the usual risks and rewards of ownership of the asset. When we have an ownership interest in the buyer, gain is recognized to the extent of the third party partner’s ownership interest and the portion of the gain attributable to our ownership interest is deferred.
Real Estate Assets
We capitalize predevelopment project costs paid to third parties. All previously capitalized predevelopment costs are expensed when it is no longer probable that the project will be completed. Once development of a project commences, all direct costs incurred to construct the project, including interest and real estate taxes, are capitalized. Additionally, certain general and administrative expenses are allocated to the projects and capitalized based on the amount of time applicable personnel work on the development project. Ordinary repairs and maintenance are expensed as incurred. Major replacements and improvements are capitalized and depreciated over their estimated useful lives.
All acquired real estate assets are accounted for using the acquisition method of accounting and accordingly, the results of operations are included in the consolidated statements of operations from the respective dates of acquisition. The purchase price is allocated to (i) tangible assets, consisting of land, buildings and improvements, as if vacant, and tenant improvements and (ii) identifiable intangible assets and liabilities generally consisting of above- and below-market leases and in-place leases. We use estimates of fair value based on estimated cash flows, using appropriate discount rates, and other valuation methods to allocate the purchase price to the acquired tangible and intangible assets. Liabilities assumed generally consist of mortgage debt on the real estate assets acquired. Assumed debt with a stated interest rate that is significantly different from market interest rates is
recorded at its fair value based on estimated market interest rates at the date of acquisition.
Depreciation is computed on a straight-line basis over estimated lives of
40
years for buildings,
10 to 20
years for certain improvements and
7 to 10
years for equipment and fixtures. Tenant improvements are capitalized and depreciated on a straight-line basis over the term of the related lease. Lease-related intangibles from acquisitions of real estate assets are amortized over the remaining terms of the related leases. The amortization of above- and below-market leases is recorded as an adjustment to minimum rental revenue, while the amortization of all other lease-related intangibles is recorded as amortization expense. Any difference between the face value of the debt assumed and its fair value is amortized to interest expense over the remaining term of the debt using the effective interest method.
Carrying Value of Long-Lived Assets
We periodically evaluate long-lived assets to determine if there has been any impairment in their carrying values and record impairment losses if the undiscounted cash flows estimated to be generated by those assets are less than their carrying amounts or if there are other indicators of impairment. If it is determined that impairment has occurred, the amount of the impairment charge is equal to the excess of the asset’s carrying value over its estimated fair value. We estimate fair value using the undiscounted cash flows expected to be generated by each Property, which are based on a number of assumptions such as leasing expectations, operating budgets, estimated useful lives, future maintenance expenditures, intent to hold for use and capitalization rates, among others. These assumptions are subject to economic and market uncertainties including, but not limited to, demand for space, competition for tenants, changes in market rental rates and costs to operate each Property. As these factors are difficult to predict and are subject to future events that may alter our assumptions, the future cash flows estimated in our impairment analyses may not be achieved. During the year ended
December 31, 2012
, we recorded a loss on impairment of real estate totaling $50.9 million. Of this total,
$26.5 million
is attributable to four Properties which were sold in 2012 and included in discontinued operations,
$23.3 million
is attributable to two existing Properties and
$1.1 million
relates to the sale of
three
outparcels. During the year ended
December 31, 2011
, we recorded impairment charges of $58.7 million. Of this total, $50.7 million is due to the impairment of one mall and $0.6 million is from the sale of one outparcel. The balance of $7.4 million relates to Properties that are included in discontinued operations. During the year ended
December 31, 2010
, we recorded a $40.3 million loss on impairment, of which $39.1 million relates to three Properties which are included in discontinued operations and $1.2 attributable to the sale of an outparcel. See
Notes 4
and
15
to the consolidated financial statements for additional information about these impairment losses.
Allowance for Doubtful Accounts
We periodically perform a detailed review of amounts due from tenants and others to determine if accounts receivable balances are impaired based on factors affecting the collectibility of those balances. Our estimate of the allowance for doubtful accounts requires significant judgment about the timing, frequency and severity of collection losses, which affects the allowance and net income. We recorded a provision for doubtful accounts of
$1.5 million
,
$1.7 million
and
$2.7 million
for the years ended
December 31, 2012
,
2011
and
2010
, respectively.
Investments in Unconsolidated Affiliates
We evaluate our joint venture arrangements to determine whether they should be recorded on a consolidated basis. The percentage of ownership interest in the joint venture, an evaluation of control and whether a variable interest entity (“VIE”) exists are all considered in the consolidation assessment.
Initial investments in joint ventures that are in economic substance a capital contribution to the joint venture are recorded in an amount equal to our historical carryover basis in the real estate contributed. Initial investments in joint ventures that are in economic substance the sale of a portion of our interest in the real estate are accounted for as a contribution of real estate recorded in an amount equal to our historical carryover basis in the ownership percentage retained and as a sale of real estate with profit recognized to the extent of the other joint venturers’ interests in the joint venture. Profit recognition assumes that we have no commitment to reinvest with respect to the percentage of the real estate sold and the accounting requirements of the full accrual method are met.
We account for our investment in joint ventures where we own a non-controlling interest or where we are not the primary beneficiary of a VIE using the equity method of accounting. Under the equity method, our cost of investment is adjusted for our share of equity in the earnings of the unconsolidated affiliate and reduced by distributions received. Generally, distributions of cash flows from operations and capital events are first made to partners to pay cumulative unpaid preferences on unreturned capital balances and then to the partners in accordance with the terms of the joint venture agreements.
Any differences between the cost of our investment in an unconsolidated affiliate and our underlying equity as reflected in the unconsolidated affiliate’s financial statements generally result from costs of our investment that are not reflected on the unconsolidated affiliate’s financial statements, capitalized interest on our investment and our share of development and leasing fees that are paid by the unconsolidated affiliate to us for development and leasing services provided to the unconsolidated affiliate during any development periods. The net difference between our investment in unconsolidated affiliates and the underlying equity
of unconsolidated affiliates is generally amortized over a period of 40 years.
On a periodic basis, we assess whether there are any indicators that the fair value of our investments in unconsolidated affiliates may be impaired. An investment is impaired only if our estimate of the fair value of the investment is less than the carrying value of the investment, and such decline in value is deemed to be other than temporary. To the extent impairment has occurred, the loss is measured as the excess of the carrying amount of the investment over the fair value of the investment. Our estimates of fair value for each investment are based on a number of assumptions such as future leasing expectations, operating forecasts, discount rates and capitalization rates, among others. These assumptions are subject to economic and market uncertainties including, but not limited to, demand for space, competition for tenants, changes in market rental rates, and operating costs. As these factors are difficult to predict and are subject to future events that may alter our assumptions, the fair values estimated in the impairment analyses may not be realized.
No impairments of investments in unconsolidated affiliates were incurred during
2012
,
2011
and
2010
.
Recent Accounting Pronouncements
Accounting Guidance Adopted
In May 2011, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2011-04,
Amendments to Achieve Common Fair Value Measurement and Disclosure Requirements in U.S. GAAP and IFRSs (
“ASU 2011-04”). The objective of ASU 2011-04 is to align fair value measurements and related disclosure requirements under GAAP and International Financial Reporting Standards (“IFRSs”), thus improving the comparability of fair value measurements presented and disclosed in financial statements prepared in accordance with U.S. GAAP and IFRSs. For public entities, this guidance was effective for interim and annual periods beginning after December 15, 2011 and should be applied prospectively. The adoption of ASU 2011-04 did not have a material impact on our consolidated financial statements.
In June 2011, the FASB issued ASU No. 2011-05,
Presentation of Comprehensive Income
(“ASU 2011-05”). The objective of this accounting update is to improve the comparability, consistency, and transparency of financial reporting and to increase the prominence of items reported in other comprehensive income. This guidance eliminates the option to present the components of other comprehensive income as part of the statement of changes in stockholders' equity. ASU 2011-05 requires that all non-owner changes in stockholders' equity be presented either in a single continuous statement of comprehensive income or in two separate but continuous statements of net income and other comprehensive income. For public entities, this guidance was effective for interim and annual periods beginning after December 15, 2011 and should be applied retrospectively. In December 2011, the FASB issued ASU 2011-12,
Deferral of the Effective Date for Amendments to the Presentation of Reclassifications of Items Out of Accumulated Other Comprehensive Income in Accounting Standards Update No. 2011-05
(“ASU 2011-12”). This guidance defers the changes in ASU 2011-05 that relate to the presentation of reclassification adjustments out of accumulated other comprehensive income. Other requirements of ASU 2011-05 are not affected by ASU 2011-12. The guidance in ASU 2011-12 was effective at the same time as ASU 2011-05 so that entities would not be required to comply with the presentation requirements in ASU 2011-05 that ASU 2011-12 deferred. The adoption of this guidance changed the presentation format of our consolidated financial statements but did not have an impact on the amounts reported in those statements.
In December 2011, the FASB issued ASU No. 2011-10,
Derecognition of in Substance Real Estate - a Scope Clarification
(“ASU 2011-10”). This guidance applies to the derecognition of in substance real estate when the parent ceases to have a controlling financial interest in a subsidiary that is in substance real estate because of a default by the subsidiary on its nonrecourse debt. Under ASU 2011-10, the reporting entity should apply the guidance in Accounting Standards Codification ("ASC") 360-20,
Property, Plant and Equipment - Real Estate Sales
, to determine whether it should derecognize the in substance real estate. Generally, the requirements to derecognize in substance real estate would not be met before the legal transfer of the real estate to the lender and the extinguishment of the related nonrecourse indebtedness. Thus, even if the reporting entity ceases to have a controlling financial interest under ASC 810-10,
Consolidation - Overall
, it would continue to include the real estate, debt, and the results of the subsidiary's operations in its consolidated financial statements until legal title to the real estate is transferred to legally satisfy the debt. ASU 2011-10 should be applied on a prospective basis to deconsolidation events occurring after the effective date. For public companies, this guidance is effective for fiscal years, and interim periods within those years, beginning on or after June 15, 2012. Early adoption is permitted. We elected to adopt ASU 2011-10 effective January 1, 2012. The adoption of this guidance did not have an impact on our consolidated financial statements.
Accounting Pronouncements Not Yet Effective
In February 2013, the FASB issued ASU 2013-02,
Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive Income
("ASU 2013-02"). The objective of ASU 2013-02 is to improve reporting of reclassifications out of accumulated other comprehensive income ("AOCI") by presenting information about such reclassifications and their corresponding effect on net income primarily in one place either on the face of the financial statements or in the notes. ASU 2013-02 requires
an entity to disclose information by component for significant amounts reclassified out of AOCI if the amounts reclassified are required to be reclassified under GAAP to net income in their entirety in the same reporting period. For amounts not required under GAAP to be reclassified in their entirety to net income, an entity is required to cross-reference to other disclosures that provide additional details about those amounts. ASU 2013-02 established the effective date and guidance for the presentation of reclassification adjustments which ASU 2011-12 deferred. For public companies, this guidance is effective on a prospective basis for fiscal years, and interim periods within those years, beginning after December 15, 2012. ASU 2013-02 does not change the calculation of net income or comprehensive income and will not have an impact on the amounts reported in the Company's consolidated financial statements.
Impact of Inflation and Deflation
Deflation can result in a decline in general price levels, often caused by a decrease in the supply of money or credit. The predominant effects of deflation are high unemployment, credit contraction and weakened consumer demand. Restricted lending practices could impact our ability to obtain financings or refinancings for our Properties and our tenants’ ability to obtain credit. Decreases in consumer demand can have a direct impact on our tenants and the rents we receive.
During inflationary periods, substantially all of our tenant leases contain provisions designed to mitigate the impact of inflation. These provisions include clauses enabling us to receive percentage rent based on tenants' gross sales, which generally increase as prices rise, and/or escalation clauses, which generally increase rental rates during the terms of the leases. In addition, many of the leases are for terms of less than ten years, which may provide us the opportunity to replace existing leases with new leases at higher base and/or percentage rent if rents of the existing leases are below the then existing market rate. Most of the leases require the tenants to pay a fixed amount subject to annual increases for their share of operating expenses, including common area maintenance, real estate taxes, insurance and certain capital expenditures, which reduces our exposure to increases in costs and operating expenses resulting from inflation.
Funds From Operations
FFO is a widely used measure of the operating performance of real estate companies that supplements net income (loss) determined in accordance with GAAP. The National Association of Real Estate Investment Trusts (“NAREIT”) defines FFO as net income (loss) (computed in accordance with GAAP) excluding gains or losses on sales of depreciable operating properties and impairment losses of depreciable properties, plus depreciation and amortization, and after adjustments for unconsolidated partnerships and joint ventures and noncontrolling interests. Adjustments for unconsolidated partnerships and joint ventures and noncontrolling interests are calculated on the same basis. We define FFO allocable to common shareholders as defined above by NAREIT less dividends on preferred stock. Our method of calculating FFO allocable to common shareholders may be different from methods used by other REITs and, accordingly, may not be comparable to such other REITs.
We believe that FFO provides an additional indicator of the operating performance of our Properties without giving effect to real estate depreciation and amortization, which assumes the value of real estate assets declines predictably over time. Since values of well-maintained real estate assets have historically risen with market conditions, we believe that FFO enhances investors’ understanding of our operating performance. The use of FFO as an indicator of financial performance is influenced not only by the operations of our Properties and interest rates, but also by our capital structure.
We present both FFO of our Operating Partnership and FFO allocable to common shareholders, as we believe that both are useful performance measures. We believe FFO of our Operating Partnership is a useful performance measure since we conduct substantially all of our business through our Operating Partnership and, therefore, it reflects the performance of the Properties in absolute terms regardless of the ratio of ownership interests of our common shareholders and the noncontrolling interest in our Operating Partnership. We believe FFO allocable to common shareholders is a useful performance measure because it is the performance measure that is most directly comparable to net income (loss) attributable to common shareholders.
In our reconciliation of net income (loss) attributable to common shareholders to FFO allocable to common shareholders that is presented below, we make an adjustment to add back noncontrolling interest in income (loss) of our Operating Partnership in order to arrive at FFO of our Operating Partnership. We then apply a percentage to FFO of our Operating Partnership to arrive at FFO allocable to common shareholders. The percentage is computed by taking the weighted average number of common shares outstanding for the period and dividing it by the sum of the weighted average number of common shares and the weighted average number of Operating Partnership units held by noncontrolling interests during the period.
FFO does not represent cash flows from operations as defined by GAAP, is not necessarily indicative of cash available to fund all cash flow needs and should not be considered as an alternative to net income (loss) for purposes of evaluating our operating performance or to cash flow as a measure of liquidity.
We recorded a gain on investment of $45.1 million related to the acquisition of the remaining 40% noncontrolling interest in Imperial Valley Mall in December 2012. During 2012 and 2011, we recorded gains on extinguishment of debt from both continuing and discontinued operations. Considering the significance and nature of these items, we believe that it is important to
identify the impact of these changes on our FFO measures for a reader to have a complete understanding of our results of operations. Therefore, we have also presented FFO excluding these items.
FFO of the Operating Partnership increased 8.4% to
$458.2 million
for the year ended
December 31, 2012
compared to
$422.7 million
for the prior year. Excluding the gain on investment and gains on extinguishment of debt, FFO of the Operating Partnership increased 5.8% for the years ending
December 31, 2012
and
2011
to
$412.8 million
and
$390.2 million
, respectively.
The reconciliation of FFO to net income attributable to common shareholders is as follows (in thousands):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year Ended December 31,
|
|
2012
|
|
2011
|
|
2010
|
Net income attributable to common shareholders
|
$
|
84,089
|
|
|
$
|
91,560
|
|
|
$
|
29,532
|
|
Noncontrolling interest in income of operating partnership
|
19,267
|
|
|
25,841
|
|
|
11,018
|
|
Depreciation and amortization expense of:
|
|
|
|
|
|
|
|
|
Consolidated properties
|
265,856
|
|
|
271,458
|
|
|
284,072
|
|
Unconsolidated affiliates
|
43,956
|
|
|
32,538
|
|
|
27,445
|
|
Discontinued operations
|
2,778
|
|
|
4,912
|
|
|
7,700
|
|
Non-real estate assets
|
(1,841
|
)
|
|
(2,488
|
)
|
|
(4,182
|
)
|
Noncontrolling interests' share of depreciation and amortization
|
(5,071
|
)
|
|
(919
|
)
|
|
(605
|
)
|
Loss on impairment of real estate, net of tax benefit
|
50,343
|
|
|
56,557
|
|
|
40,240
|
|
Gain on depreciable property
|
(652
|
)
|
|
(56,763
|
)
|
|
—
|
|
(Gain) loss on discontinued operations, net of tax
|
(566
|
)
|
|
1
|
|
|
(379
|
)
|
Funds from operations of the operating partnership
|
458,159
|
|
|
422,697
|
|
|
394,841
|
|
Gain on extinguishment of debt
|
(265
|
)
|
|
(32,463
|
)
|
|
—
|
|
Gain on investments
|
(45,072
|
)
|
|
—
|
|
|
$
|
888
|
|
Funds from operations of the operating partnership, as adjusted
|
$
|
412,822
|
|
|
$
|
390,234
|
|
|
$
|
395,729
|
|
The reconciliations of FFO of the operating partnership to FFO allocable to Company shareholders, including and excluding the gain on extinguishment of debt and the gain on investments, are as follows (in thousands):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year Ended December 31,
|
|
2012
|
|
2011
|
|
2010
|
Funds from operations of the operating partnership
|
$
|
458,159
|
|
|
$
|
422,697
|
|
|
$
|
394,841
|
|
Percentage allocable to common shareholders
(1)
|
81.36
|
%
|
|
77.91
|
%
|
|
72.83
|
%
|
Funds from operations allocable to common shareholders
|
$
|
372,758
|
|
|
$
|
329,323
|
|
|
$
|
287,563
|
|
|
|
|
|
|
|
Funds from operations of the operating partnership, as adjusted
|
$
|
412,822
|
|
|
$
|
390,234
|
|
|
$
|
395,729
|
|
Percentage allocable to common shareholders
(1)
|
81.36
|
%
|
|
77.91
|
%
|
|
72.83
|
%
|
Funds from operations allocable to Company shareholders,
as adjusted
|
$
|
335,872
|
|
|
$
|
304,031
|
|
|
$
|
288,209
|
|
|
|
(1)
|
Represents the weighted average number of common shares outstanding for the period divided by the sum of the weighted average number of common shares and the weighted average number of Operating Partnership units held by noncontrolling interests during the period.
|
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
We are exposed to various market risk exposures, including interest rate risk and foreign exchange rate risk. The following discussion regarding our risk management activities includes forward-looking statements that involve risk and uncertainties. Estimates of future performance and economic conditions are reflected assuming certain changes in interest and foreign exchange rates. Caution should be used in evaluating our overall market risk from the information presented below, as actual results may differ. We employ various derivative programs to manage certain portions of our market risk associated with interest rates. See
Note 6
of the notes to consolidated financial statements for further discussions of the qualitative aspects of market risk, regarding derivative financial instrument activity.
Interest Rate Risk
Based on our proportionate share of consolidated and unconsolidated variable-rate debt at
December 31, 2012
, a 0.5% increase or decrease in interest rates on variable rate debt would decrease or increase annual cash flows by approximate
ly $5.4 million and $2.3 million, respectively and in
crease or decrease annual interest expense, after the effect of capitalized interest, by approximatel
y $5.3 million and $2.2 million,
respectively.
Based on our proportionate share of total consolidated and unconsolidated debt at
December 31, 2012
, a 0.5% increase in interest rates would decrease the fair value of debt by approximately $98.0 million, while a 0.5% decrease in interest rates would increase the fair value of debt by approximately $92.9 million.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
Reference is made to the Index to Financial Statements and Schedules contained in
Item 15
o
n page 75.
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
None.
ITEM 9A. CONTROLS AND PROCEDURES
Conclusion Regarding Effectiveness of Disclosure Controls and Procedures
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of its effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
Under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, we have evaluated the effectiveness of our disclosure controls and procedures, as defined in Rule 13a-15(e) under the Securities Exchange Act of 1934, as amended, as of the end of the period covered by this report. Based on that evaluation, these officers concluded that our disclosure controls and procedures were effective to ensure that the information required to be disclosed by us in the reports that we file or submit under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported within the time periods specified in the SEC rules and forms, and is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure.
Management's Report on Internal Control over Financial Reporting
Management is responsible for establishing and maintaining adequate internal control over financial reporting, as defined in Rule 13a-15(f) under the Securities Exchange Act of 1934, as amended. We assessed the effectiveness of our internal control over financial reporting, based on criteria established in
Internal Control – Integrated Framework
issued by the Committee of Sponsoring Organizations of the Treadway Commission, and concluded that, as of
December 31, 2012
, we maintained effective internal control over financial reporting, as stated in our report which is included herein.
The effectiveness of our internal control over financial reporting as of
December 31, 2012
has been audited by Deloitte & Touche LLP, an independent registered public accounting firm, as stated in their report which is included herein in
Item 15
.
Report of Management On Internal Control Over Financial Reporting
Management of CBL & Associates Properties, Inc. and its consolidated subsidiaries (the “Company”) is responsible for establishing and maintaining adequate internal control over financial reporting. The Company’s internal control over financial reporting is a process designed under the supervision of the Company’s Chief Executive Officer and Chief Financial Officer to provide reasonable assurance regarding the reliability of financial reporting and the preparation of the Company’s financial statements for external reporting purposes in accordance with U.S. generally accepted accounting principles.
Management recognizes that there are inherent limitations in the effectiveness of internal control over financial reporting, including the potential for human error or the circumvention or overriding of internal controls. Accordingly, even effective internal control over financial reporting cannot provide absolute assurance with respect to financial statement preparation. Because of such limitations, there is a risk that material misstatements may not be prevented or detected on a timely basis by internal control over financial reporting. In addition, any projection of the evaluation of effectiveness to future periods is subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the polices or procedures may deteriorate.
Management conducted an assessment of the effectiveness of the Company’s internal control over financial reporting based on the framework established in
Internal Control
—
Integrated Framework
issued by the Committee of Sponsoring Organizations of the Treadway Commission and concluded that, as of
December 31, 2012
, the Company maintained effective internal control over financial reporting.
Deloitte & Touche LLP, the Company’s independent registered public accounting firm, has audited our internal control over financial reporting as of
December 31, 2012
as stated in their report which is included herein in
Item 15
.
Changes in Internal Control over Financial Reporting
There were no changes in the Company's internal control over financial reporting during the quarter ended
December 31, 2012
that have materially affected, or are reasonably likely to materially affect, the Company's internal control over financial reporting.
ITEM 9B. OTHER INFORMATION
None.
PART III
ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
Incorporated herein by reference to the sections entitled “ELECTION OF DIRECTORS,” “Directors and Executive Officers,” “Certain Terms of the Jacobs Acquisition,” “Corporate Governance Matters - Code of Business Conduct and Ethics,” “Board of Directors’ Meetings and Committees – Audit Committee,” and “Section 16(a) Beneficial Ownership Reporting Compliance” in our definitive proxy statement filed with the Securities and Exchange Commission (the “Commission”) with respect to our Annual Meeting of Stockholders to be held on
May 13, 2013
.
Our Board of Directors has determined that Winston W. Walker, an independent director and chairman of the audit committee, qualifies as an “audit committee financial expert” as such term is defined by the rules of the Commission.
ITEM 11. EXECUTIVE COMPENSATION
Incorporated herein by reference to the sections entitled “DIRECTOR COMPENSATION,” “EXECUTIVE COMPENSATION,” “REPORT OF THE COMPENSATION COMMITTEE OF THE BOARD OF DIRECTORS” and “Compensation Committee Interlocks and Insider Participation” in our definitive proxy statement filed with the Commission with respect to our Annual Meeting of Stockholders to be held on
May 13, 2013
.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS
Incorporated herein by reference to the sections entitled “SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT” and “Equity Compensation Plan Information as of
December 31, 2012
”, in our definitive proxy statement filed with the Commission with respect to our Annual Meeting of Stockholders to be held on
May 13, 2013
.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE
Incorporated herein by reference to the sections entitled “Corporate Governance Matters – Director Independence” and “CERTAIN RELATIONSHIPS AND RELATED PERSON TRANSACTIONS”, in our definitive proxy statement filed with the Commission with respect to our Annual Meeting of Stockholders to be held on
May 13, 2013
.
ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES
Incorporated herein by reference to the section entitled “Independent Registered Public Accountants’ Fees and Services” under “RATIFICATION OF THE SELECTION OF INDEPENDENT REGISTERED PUBLIC ACCOUNTANTS” in our definitive proxy statement filed with the Commission with respect to our Annual Meeting of Stockholders to be held on
May 13, 2013
.
PART IV
ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES
|
|
|
|
(1)
|
Consolidated Financial Statements
|
Page Number
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(2)
|
Consolidated Financial Statement Schedules
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Financial statement schedules not listed herein are either not required or are not present in amounts sufficient to require submission of the schedule or the information required to be included therein is included in our consolidated financial statements in Item 15 or are reported elsewhere.
|
|
|
|
|
(3)
|
Exhibits
|
|
|
|
|
|
The Exhibit Index attached to this report is incorporated by reference into this Item 15(a)(3).
|
|
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
|
|
|
|
|
CBL & ASSOCIATES PROPERTIES, INC.
|
|
|
(Registrant)
|
|
|
|
|
|
By: __
/s/ Farzana K. Mitchell
_________
|
|
|
Farzana K. Mitchell
|
|
|
Executive Vice President - Chief Financial Officer and Treasurer
|
|
Dated: March 1, 2013
|
|
|
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated.
|
|
|
|
|
Signature
|
|
Title
|
Date
|
/s/ Charles B. Lebovitz
|
Chairman of the Board
|
March 1, 2013
|
Charles B. Lebovitz
|
|
|
|
|
/s/ Stephen D. Lebovitz
|
Director, President and Chief Executive Officer (Principal Executive Officer)
|
March 1, 2013
|
Stephen D. Lebovitz
|
|
|
|
|
/s/ Farzana K. Mitchell
|
Executive Vice President - Chief Financial Officer and Treasurer (Principal Financial Officer and Principal Accounting Officer)
|
March 1, 2013
|
Farzana K. Mitchell
|
|
|
|
|
/s/ Gary L. Bryenton*
|
Director
|
March 1, 2013
|
Gary L. Bryenton
|
|
|
|
|
/s/ Thomas J. DeRosa*
|
Director
|
March 1, 2013
|
Thomas J. DeRosa
|
|
|
|
|
/s/ Matthew S. Dominski*
|
Director
|
March 1, 2013
|
Matthew S. Dominski
|
|
|
|
|
/s/ Gary J. Nay*
|
Director
|
March 1, 2013
|
Gary J. Nay
|
|
|
|
|
/s/ Kathleen M. Nelson*
|
Director
|
March 1, 2013
|
Kathleen M. Nelson
|
|
|
|
|
/s/ Winston W. Walker*
|
Director
|
March 1, 2013
|
Winston W. Walker
|
|
|
|
|
*By: /s/ Farzana K. Mitchell
|
Attorney-in-Fact
|
March 1, 2013
|
Farzana K. Mitchell
|
|
|
|
INDEX TO FINANCIAL STATEMENTS AND SCHEDULES
|
|
|
Page Number
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Financial statement schedules not listed herein are either not required or are not present in amounts sufficient to require submission of the schedule or the information required to be included therein is included in our consolidated financial statements in
Item 15
or are reported elsewhere.
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Board of Directors and Shareholders of
CBL & Associates Properties, Inc.
Chattanooga, TN:
We have audited the accompanying consolidated balance sheets of CBL & Associates Properties, Inc. and subsidiaries (the "Company") as of December 31, 2012 and 2011, and the related consolidated statements of operations, comprehensive income, equity, and cash flows for each of the three years in the period ended December 31, 2012. Our audits also included the financial statement schedules listed in the Index at Item 15. We also have audited the Company's internal control over financial reporting as of December 31, 2012, based on criteria established in
Internal Control — Integrated Framework
issued by the Committee of Sponsoring Organizations of the Treadway Commission. The Company's management is responsible for these financial statements and financial statement schedules, for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Report of Management On Internal Control Over Financial Reporting. Our responsibility is to express an opinion on these financial statements and financial statement schedules and an opinion on the Company's internal control over financial reporting based on our audits.
We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement and whether effective internal control over financial reporting was maintained in all material respects. Our audits of the financial statements included examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audits also included performing such other procedures as we considered necessary in the circumstances. We believe that our audits provide a reasonable basis for our opinions.
A company's internal control over financial reporting is a process designed by, or under the supervision of, the company's principal executive and principal financial officers, or persons performing similar functions, and effected by the company's board of directors, management, and other personnel to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company's internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company's assets that could have a material effect on the financial statements.
Because of the inherent limitations of internal control over financial reporting, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may not be prevented or detected on a timely basis. Also, projections of any evaluation of the effectiveness of the internal control over financial reporting to future periods are subject to the risk that the controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of CBL & Associates Properties, Inc. and subsidiaries as of December 31, 2012 and 2011, and the results of their operations and their cash flows for each of the three years in the period ended December 31, 2012, in conformity with accounting principles generally accepted in the United States of America. Also, in our opinion, such financial statement schedules, when considered in relation to the basic consolidated financial statements taken as a whole, present fairly, in all material respects, the information set forth therein. Also, in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2012, based on the criteria established in
Internal Control — Integrated Framework
issued by the Committee of Sponsoring Organizations of the Treadway Commission
.
/s/ Deloitte & Touche LLP
Atlanta, Georgia
March 1, 2013
CBL & Associates Properties, Inc.
Consolidated Balance Sheets
(In thousands, except share data)
|
|
|
|
|
|
|
|
|
|
December 31,
|
ASSETS
|
2012
|
|
2011
|
Real estate assets:
|
|
|
|
Land
|
$
|
905,339
|
|
|
$
|
851,303
|
|
Buildings and improvements
|
7,228,293
|
|
|
6,777,776
|
|
|
8,133,632
|
|
|
7,629,079
|
|
Accumulated depreciation
|
(1,972,031
|
)
|
|
(1,762,149
|
)
|
|
6,161,601
|
|
|
5,866,930
|
|
Held for sale
|
29,425
|
|
|
14,033
|
|
Developments in progress
|
137,956
|
|
|
124,707
|
|
Net investment in real estate assets
|
6,328,982
|
|
|
6,005,670
|
|
Cash and cash equivalents
|
78,248
|
|
|
56,092
|
|
Receivables:
|
|
|
|
|
|
Tenant, net of allowance for doubtful accounts of $1,977 and $1,760
in 2012 and 2011, respectively
|
78,963
|
|
|
74,160
|
|
Other, net of allowance for doubtful accounts of $1,270 and $1,400
in 2012 and 2011, respectively
|
8,467
|
|
|
11,592
|
|
Mortgage and other notes receivable
|
25,967
|
|
|
34,239
|
|
Investments in unconsolidated affiliates
|
259,810
|
|
|
304,710
|
|
Intangible lease assets and other assets
|
309,299
|
|
|
232,965
|
|
|
$
|
7,089,736
|
|
|
$
|
6,719,428
|
|
|
|
|
|
LIABILITIES, REDEEMABLE NONCONTROLLING INTERESTS AND EQUITY
|
|
|
|
|
|
Mortgage and other indebtedness
|
$
|
4,745,683
|
|
|
$
|
4,489,355
|
|
Accounts payable and accrued liabilities
|
358,874
|
|
|
303,577
|
|
Total liabilities
|
5,104,557
|
|
|
4,792,932
|
|
Commitments and contingencies (Note 14)
|
|
|
|
|
|
Redeemable noncontrolling interests:
|
|
|
|
|
|
Redeemable noncontrolling partnership interests
|
40,248
|
|
|
32,271
|
|
Redeemable noncontrolling preferred joint venture interest
|
423,834
|
|
|
423,834
|
|
Total redeemable noncontrolling interests
|
464,082
|
|
|
456,105
|
|
Shareholders' equity:
|
|
|
|
|
|
Preferred Stock, $.01 par value, 15,000,000 shares authorized:
|
|
|
|
|
|
7.75% Series C Cumulative Redeemable Preferred Stock,
460,000 shares outstanding in 2011
|
—
|
|
|
5
|
|
7.375% Series D Cumulative Redeemable Preferred Stock,
1,815,000 shares outstanding
|
18
|
|
|
18
|
|
6.625% Series E Cumulative Redeemable Preferred Stock,
690,000 shares outstanding in 2012
|
7
|
|
|
—
|
|
Common Stock, $.01 par value, 350,000,000 shares authorized,
161,309,652 and 148,364,037 issued and outstanding in 2012
and 2011, respectively
|
1,613
|
|
|
1,484
|
|
Additional paid-in capital
|
1,773,630
|
|
|
1,657,927
|
|
Accumulated other comprehensive income
|
6,986
|
|
|
3,425
|
|
Dividends in excess of cumulative earnings
|
(453,561
|
)
|
|
(399,581
|
)
|
Total shareholders' equity
|
1,328,693
|
|
|
1,263,278
|
|
Noncontrolling interests
|
192,404
|
|
|
207,113
|
|
Total equity
|
1,521,097
|
|
|
1,470,391
|
|
|
$
|
7,089,736
|
|
|
$
|
6,719,428
|
|
The accompanying notes are an integral part of these consolidated statements.
CBL & Associates Properties, Inc.
Consolidated Statements of Operations
(In thousands, except per share amounts)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year Ended December 31,
|
|
2012
|
|
2011
|
|
2010
|
REVENUES:
|
|
|
|
|
|
Minimum rents
|
$
|
663,895
|
|
|
$
|
668,628
|
|
|
$
|
664,750
|
|
Percentage rents
|
17,995
|
|
|
17,149
|
|
|
17,367
|
|
Other rents
|
22,657
|
|
|
22,428
|
|
|
22,536
|
|
Tenant reimbursements
|
287,954
|
|
|
301,323
|
|
|
305,385
|
|
Management, development and leasing fees
|
10,772
|
|
|
6,935
|
|
|
6,416
|
|
Other
|
31,367
|
|
|
34,851
|
|
|
29,249
|
|
Total revenues
|
1,034,640
|
|
|
1,051,314
|
|
|
1,045,703
|
|
|
|
|
|
|
|
OPERATING EXPENSES:
|
|
|
|
|
|
|
|
|
Property operating
|
145,827
|
|
|
148,961
|
|
|
144,038
|
|
Depreciation and amortization
|
265,856
|
|
|
271,458
|
|
|
280,575
|
|
Real estate taxes
|
90,503
|
|
|
91,723
|
|
|
94,787
|
|
Maintenance and repairs
|
52,577
|
|
|
55,500
|
|
|
54,723
|
|
General and administrative
|
51,251
|
|
|
44,751
|
|
|
43,383
|
|
Loss on impairment of real estate
|
24,379
|
|
|
51,304
|
|
|
1,156
|
|
Other
|
25,078
|
|
|
28,898
|
|
|
25,523
|
|
Total operating expenses
|
655,471
|
|
|
692,595
|
|
|
644,185
|
|
Income from operations
|
379,169
|
|
|
358,719
|
|
|
401,518
|
|
Interest and other income
|
3,955
|
|
|
2,583
|
|
|
3,868
|
|
Interest expense
|
(244,432
|
)
|
|
(267,072
|
)
|
|
(281,102
|
)
|
Gain on extinguishment of debt
|
265
|
|
|
1,029
|
|
|
—
|
|
Gain on investments
|
45,072
|
|
|
—
|
|
|
888
|
|
Gain on sales of real estate assets
|
2,286
|
|
|
59,396
|
|
|
2,887
|
|
Equity in earnings (losses) of unconsolidated affiliates
|
8,313
|
|
|
6,138
|
|
|
(188
|
)
|
Income tax (provision) benefit
|
(1,404
|
)
|
|
269
|
|
|
6,417
|
|
Income from continuing operations
|
193,224
|
|
|
161,062
|
|
|
134,288
|
|
Operating income (loss) of discontinued operations
|
(19,643
|
)
|
|
23,933
|
|
|
(36,497
|
)
|
Gain (loss) on discontinued operations
|
938
|
|
|
(1
|
)
|
|
379
|
|
Net income
|
174,519
|
|
|
184,994
|
|
|
98,170
|
|
Net income attributable to noncontrolling interests in:
|
|
|
|
|
|
|
|
|
Operating partnership
|
(19,267
|
)
|
|
(25,841
|
)
|
|
(11,018
|
)
|
Other consolidated subsidiaries
|
(23,652
|
)
|
|
(25,217
|
)
|
|
(25,001
|
)
|
Net income attributable to the Company
|
131,600
|
|
|
133,936
|
|
|
62,151
|
|
Preferred dividends
|
(47,511
|
)
|
|
(42,376
|
)
|
|
(32,619
|
)
|
Net income attributable to common shareholders
|
$
|
84,089
|
|
|
$
|
91,560
|
|
|
$
|
29,532
|
|
|
|
|
|
|
|
Basic per share data attributable to common shareholders:
|
|
|
|
|
|
|
|
|
Income from continuing operations, net of preferred dividends
|
$
|
0.64
|
|
|
$
|
0.49
|
|
|
$
|
0.40
|
|
Discontinued operations
|
(0.10
|
)
|
|
0.13
|
|
|
(0.19
|
)
|
Net income attributable to common shareholders
|
$
|
0.54
|
|
|
$
|
0.62
|
|
|
$
|
0.21
|
|
Weighted average common shares outstanding
|
154,762
|
|
|
148,289
|
|
|
138,375
|
|
|
|
|
|
|
|
Diluted per share data attributable to common shareholders:
|
|
|
|
|
|
|
|
|
Income from continuing operations, net of preferred dividends
|
$
|
0.64
|
|
|
$
|
0.49
|
|
|
$
|
0.40
|
|
Discontinued operations
|
(0.10
|
)
|
|
0.13
|
|
|
(0.19
|
)
|
Net income attributable to common shareholders
|
$
|
0.54
|
|
|
$
|
0.62
|
|
|
$
|
0.21
|
|
Weighted average common and potential dilutive common shares outstanding
|
154,807
|
|
|
148,334
|
|
|
138,416
|
|
|
|
|
|
|
|
Amounts attributable to common shareholders:
|
|
|
|
|
|
|
|
|
Income from continuing operations, net of preferred dividends
|
$
|
99,307
|
|
|
$
|
72,914
|
|
|
$
|
55,836
|
|
Discontinued operations
|
(15,218
|
)
|
|
18,646
|
|
|
(26,304
|
)
|
Net income attributable to common shareholders
|
$
|
84,089
|
|
|
$
|
91,560
|
|
|
$
|
29,532
|
|
The accompanying notes are an integral part of these consolidated statements.
CBL & Associates Properties, Inc.
Consolidated Statements of Comprehensive Income
(In thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year Ended December 31,
|
|
2012
|
|
2011
|
|
2010
|
Net income
|
$
|
174,519
|
|
|
$
|
184,994
|
|
|
$
|
98,170
|
|
|
|
|
|
|
|
Other comprehensive income (loss):
|
|
|
|
|
|
Unrealized holding gain (loss) on available-for-sale securities
|
4,426
|
|
|
(214
|
)
|
|
8,402
|
|
Reclassification to net income of realized (gain) loss on available-for-sale securities
|
(224
|
)
|
|
22
|
|
|
114
|
|
Unrealized gain (loss) on hedging instruments
|
(207
|
)
|
|
(5,521
|
)
|
|
2,742
|
|
Unrealized loss on foreign currency translation adjustment
|
—
|
|
|
—
|
|
|
(156
|
)
|
Reclassification to net income of realized loss on foreign currency adjustment
|
—
|
|
|
—
|
|
|
169
|
|
Total other comprehensive income (loss)
|
3,995
|
|
|
(5,713
|
)
|
|
11,271
|
|
|
|
|
|
|
|
Comprehensive income
|
178,514
|
|
|
179,281
|
|
|
109,441
|
|
Comprehensive income attributable to noncontrolling interests in:
|
|
|
|
|
|
Operating partnership
|
(19,701
|
)
|
|
(24,558
|
)
|
|
(14,925
|
)
|
Other consolidated subsidiaries
|
(23,652
|
)
|
|
(25,217
|
)
|
|
(25,001
|
)
|
Comprehensive income attributable to the Company
|
$
|
135,161
|
|
|
$
|
129,506
|
|
|
$
|
69,515
|
|
The accompanying notes are an integral part of these consolidated statements.
CBL & Associates Properties, Inc.
Consolidated Statements of Equity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(in thousands, except share data)
|
|
|
Equity
|
|
|
|
Shareholders' Equity
|
|
|
|
|
|
Redeemable Noncontrolling Partnership
Interests
|
|
Preferred
Stock
|
|
Common
Stock
|
|
Additional
Paid-in
Capital
|
|
Accumulated
Other
Comprehensive Income (Loss)
|
|
Dividends in Excess of Cumulative Earnings
|
|
Total Shareholders' Equity
|
|
Noncontrolling Interests
|
|
Total Equity
|
Balance, December 31, 2009
|
22,689
|
|
|
12
|
|
|
1,379
|
|
|
1,399,654
|
|
|
491
|
|
|
(283,640
|
)
|
|
1,117,896
|
|
|
302,483
|
|
|
1,420,379
|
|
Net income
|
4,333
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
62,151
|
|
|
62,151
|
|
|
11,016
|
|
|
73,167
|
|
Other comprehensive income (loss)
|
(304
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
7,364
|
|
|
—
|
|
|
7,364
|
|
|
4,211
|
|
|
11,575
|
|
Issuance of 1,115,000 shares of Series D preferred stock in equity offerings
|
—
|
|
|
11
|
|
|
—
|
|
|
229,336
|
|
|
—
|
|
|
—
|
|
|
229,347
|
|
|
—
|
|
|
229,347
|
|
Conversion of 9,807,013 operating partnership special common units to shares of common stock
|
—
|
|
|
—
|
|
|
98
|
|
|
56,240
|
|
|
—
|
|
|
—
|
|
|
56,338
|
|
|
(56,338
|
)
|
|
—
|
|
Dividends declared - common stock
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(112,418
|
)
|
|
(112,418
|
)
|
|
—
|
|
|
(112,418
|
)
|
Dividends declared - preferred stock
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(32,619
|
)
|
|
(32,619
|
)
|
|
—
|
|
|
(32,619
|
)
|
Issuance of 130,367 shares of common stock and restricted common stock
|
—
|
|
|
—
|
|
|
1
|
|
|
213
|
|
|
—
|
|
|
—
|
|
|
214
|
|
|
—
|
|
|
214
|
|
Cancellation of 17,790 shares of restricted common stock
|
—
|
|
|
—
|
|
|
—
|
|
|
(175
|
)
|
|
—
|
|
|
—
|
|
|
(175
|
)
|
|
—
|
|
|
(175
|
)
|
Exercise of stock options
|
—
|
|
|
—
|
|
|
1
|
|
|
1,455
|
|
|
—
|
|
|
—
|
|
|
1,456
|
|
|
—
|
|
|
1,456
|
|
Accrual under deferred compensation arrangements
|
—
|
|
|
—
|
|
|
—
|
|
|
41
|
|
|
—
|
|
|
—
|
|
|
41
|
|
|
—
|
|
|
41
|
|
Amortization of deferred compensation
|
—
|
|
|
—
|
|
|
—
|
|
|
2,211
|
|
|
—
|
|
|
—
|
|
|
2,211
|
|
|
—
|
|
|
2,211
|
|
Additions to deferred financing costs
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
34
|
|
|
34
|
|
Income tax effect of share-based compensation
|
(10
|
)
|
|
—
|
|
|
—
|
|
|
(1,468
|
)
|
|
—
|
|
|
—
|
|
|
(1,468
|
)
|
|
(337
|
)
|
|
(1,805
|
)
|
Adjustment for noncontrolling interests
|
3,139
|
|
|
—
|
|
|
—
|
|
|
(15,572
|
)
|
|
—
|
|
|
—
|
|
|
(15,572
|
)
|
|
12,433
|
|
|
(3,139
|
)
|
Adjustment to record redeemable noncontrolling interests at redemption value
|
14,428
|
|
|
—
|
|
|
—
|
|
|
(14,428
|
)
|
|
—
|
|
|
—
|
|
|
(14,428
|
)
|
|
—
|
|
|
(14,428
|
)
|
Distributions to noncontrolling interests
|
(9,896
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(55,131
|
)
|
|
(55,131
|
)
|
Contributions from noncontrolling interests in Operating Partnership
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
5,234
|
|
|
5,234
|
|
Balance, December 31, 2010
|
$
|
34,379
|
|
|
$
|
23
|
|
|
$
|
1,479
|
|
|
$
|
1,657,507
|
|
|
$
|
7,855
|
|
|
$
|
(366,526
|
)
|
|
$
|
1,300,338
|
|
|
$
|
223,605
|
|
|
$
|
1,523,943
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
|
4,940
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
133,936
|
|
|
133,936
|
|
|
25,473
|
|
|
159,409
|
|
Other comprehensive loss
|
(48
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(4,430
|
)
|
|
—
|
|
|
(4,430
|
)
|
|
(1,235
|
)
|
|
(5,665
|
)
|
Conversion of 125,100 operating partnership special common units to shares of common stock
|
—
|
|
|
—
|
|
|
1
|
|
|
728
|
|
|
—
|
|
|
—
|
|
|
729
|
|
|
(729
|
)
|
|
—
|
|
Dividends declared - common stock
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(124,615
|
)
|
|
(124,615
|
)
|
|
—
|
|
|
(124,615
|
)
|
Dividends declared - preferred stock
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(42,376
|
)
|
|
(42,376
|
)
|
|
—
|
|
|
(42,376
|
)
|
Issuance of 190,812 shares of common stock and restricted common stock
|
—
|
|
|
—
|
|
|
2
|
|
|
276
|
|
|
—
|
|
|
—
|
|
|
278
|
|
|
—
|
|
|
278
|
|
Cancellation of 16,082 shares of restricted common stock
|
—
|
|
|
—
|
|
|
—
|
|
|
(125
|
)
|
|
—
|
|
|
—
|
|
|
(125
|
)
|
|
—
|
|
|
(125
|
)
|
Exercise of stock options
|
—
|
|
|
—
|
|
|
2
|
|
|
1,953
|
|
|
—
|
|
|
—
|
|
|
1,955
|
|
|
—
|
|
|
1,955
|
|
Accrual under deferred compensation arrangements
|
—
|
|
|
—
|
|
|
—
|
|
|
56
|
|
|
—
|
|
|
—
|
|
|
56
|
|
|
—
|
|
|
56
|
|
Amortization of deferred compensation
|
—
|
|
|
—
|
|
|
—
|
|
|
1,629
|
|
|
—
|
|
|
—
|
|
|
1,629
|
|
|
—
|
|
|
1,629
|
|
Adjustment for noncontrolling interests
|
3,005
|
|
|
—
|
|
|
—
|
|
|
(5,205
|
)
|
|
—
|
|
|
—
|
|
|
(5,205
|
)
|
|
2,200
|
|
|
(3,005
|
)
|
Adjustment to record redeemable noncontrolling interests at redemption value
|
(1,108
|
)
|
|
—
|
|
|
—
|
|
|
1,108
|
|
|
—
|
|
|
—
|
|
|
1,108
|
|
|
—
|
|
|
1,108
|
|
Distributions to noncontrolling interests
|
(8,897
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(44,239
|
)
|
|
(44,239
|
)
|
Contributions from noncontrolling interests in Operating Partnership
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,038
|
|
|
2,038
|
|
Balance, December 31, 2011
|
$
|
32,271
|
|
|
$
|
23
|
|
|
$
|
1,484
|
|
|
$
|
1,657,927
|
|
|
$
|
3,425
|
|
|
$
|
(399,581
|
)
|
|
$
|
1,263,278
|
|
|
$
|
207,113
|
|
|
$
|
1,470,391
|
|
CBL & Associates Properties, Inc.
Consolidated Statements of Equity
(Continued)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(in thousands, except share data)
|
|
|
Equity
|
|
|
|
Shareholders' Equity
|
|
|
|
|
|
Redeemable Noncontrolling Partnership
Interests
|
|
Preferred
Stock
|
|
Common
Stock
|
|
Additional
Paid-in
Capital
|
|
Accumulated
Other
Comprehensive Income (Loss)
|
|
Dividends in Excess of Cumulative Earnings
|
|
Total Shareholders' Equity
|
|
Noncontrolling Interests
|
|
Total Equity
|
Balance, December 31, 2011
|
32,271
|
|
|
23
|
|
|
1,484
|
|
|
1,657,927
|
|
|
3,425
|
|
|
(399,581
|
)
|
|
1,263,278
|
|
|
207,113
|
|
|
1,470,391
|
|
Net income
|
4,445
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
131,600
|
|
|
131,600
|
|
|
17,772
|
|
|
149,372
|
|
Other comprehensive income
|
21
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3,561
|
|
|
—
|
|
|
3,561
|
|
|
413
|
|
|
3,974
|
|
Issuance of 690,000 shares of Series E preferred stock in equity offering
|
—
|
|
|
7
|
|
|
—
|
|
|
166,713
|
|
|
—
|
|
|
—
|
|
|
166,720
|
|
|
—
|
|
|
166,720
|
|
Redemption of Series C preferred stock
|
—
|
|
|
(5
|
)
|
|
—
|
|
|
(111,222
|
)
|
|
—
|
|
|
(3,773
|
)
|
|
(115,000
|
)
|
|
—
|
|
|
(115,000
|
)
|
Conversion of 12,466,000 operating partnership common units to shares of common stock
|
—
|
|
|
—
|
|
|
125
|
|
|
59,613
|
|
|
—
|
|
|
—
|
|
|
59,738
|
|
|
(59,738
|
)
|
|
—
|
|
Purchase of noncontrolling interests in Operating Partnership
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(9,863
|
)
|
|
(9,863
|
)
|
Issuance of noncontrolling interest in Operating Partnership
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
14,000
|
|
|
14,000
|
|
Dividends declared - common stock
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(138,069
|
)
|
|
(138,069
|
)
|
|
—
|
|
|
(138,069
|
)
|
Dividends declared - preferred stock
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(43,738
|
)
|
|
(43,738
|
)
|
|
—
|
|
|
(43,738
|
)
|
Issuance of 232,560 shares of common stock and restricted common stock
|
—
|
|
|
—
|
|
|
2
|
|
|
728
|
|
|
—
|
|
|
—
|
|
|
730
|
|
|
—
|
|
|
730
|
|
Cancellation of 39,779 shares of restricted common stock
|
—
|
|
|
—
|
|
|
—
|
|
|
(633
|
)
|
|
—
|
|
|
—
|
|
|
(633
|
)
|
|
—
|
|
|
(633
|
)
|
Exercise of stock options
|
—
|
|
|
—
|
|
|
2
|
|
|
4,452
|
|
|
—
|
|
|
—
|
|
|
4,454
|
|
|
—
|
|
|
4,454
|
|
Accrual under deferred compensation arrangements
|
—
|
|
|
—
|
|
|
—
|
|
|
44
|
|
|
—
|
|
|
—
|
|
|
44
|
|
|
—
|
|
|
44
|
|
Amortization of deferred compensation
|
—
|
|
|
—
|
|
|
—
|
|
|
3,863
|
|
|
—
|
|
|
—
|
|
|
3,863
|
|
|
—
|
|
|
3,863
|
|
Accelerated vesting of share-based compensation
|
—
|
|
|
—
|
|
|
—
|
|
|
(725
|
)
|
|
—
|
|
|
—
|
|
|
(725
|
)
|
|
—
|
|
|
(725
|
)
|
Issuance of 42,484 shares of common stock under deferred compensation arrangement
|
—
|
|
|
—
|
|
|
—
|
|
|
(615
|
)
|
|
—
|
|
|
—
|
|
|
(615
|
)
|
|
—
|
|
|
(615
|
)
|
Adjustment for noncontrolling interests
|
3,197
|
|
|
—
|
|
|
—
|
|
|
(3,360
|
)
|
|
—
|
|
|
—
|
|
|
(3,360
|
)
|
|
163
|
|
|
(3,197
|
)
|
Adjustment to record redeemable noncontrolling interests at redemption value
|
8,778
|
|
|
—
|
|
|
—
|
|
|
(3,155
|
)
|
|
—
|
|
|
—
|
|
|
(3,155
|
)
|
|
(5,623
|
)
|
|
(8,778
|
)
|
Distributions to noncontrolling interests
|
(8,464
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(34,119
|
)
|
|
(34,119
|
)
|
Contributions from noncontrolling interests in Operating Partnership
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
7,120
|
|
|
7,120
|
|
Purchase of noncontrolling interests in other consolidated subsidiaries
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
40,962
|
|
|
40,962
|
|
Acquire controlling interest in shopping center property
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
14,204
|
|
|
14,204
|
|
Balance, December 31, 2012
|
$
|
40,248
|
|
|
$
|
25
|
|
|
$
|
1,613
|
|
|
$
|
1,773,630
|
|
|
$
|
6,986
|
|
|
$
|
(453,561
|
)
|
|
$
|
1,328,693
|
|
|
$
|
192,404
|
|
|
$
|
1,521,097
|
|
The accompanying notes are an integral part of these consolidated statements.
CBL & Associates Properties, Inc.
Consolidated Statements of Cash Flows
(In thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year Ended December 31,
|
|
2012
|
|
2011
|
|
2010
|
CASH FLOWS FROM OPERATING ACTIVITIES:
|
|
|
|
|
|
Net income
|
$
|
174,519
|
|
|
$
|
184,994
|
|
|
$
|
98,170
|
|
Adjustments to reconcile net income to net cash provided by
operating activities:
|
|
|
|
|
|
Depreciation and amortization
|
268,634
|
|
|
276,370
|
|
|
291,772
|
|
Amortization of deferred finance costs and debt premiums (discounts)
|
7,896
|
|
|
10,239
|
|
|
7,414
|
|
Net amortization of intangible lease assets and liabilities
|
(1,263
|
)
|
|
(906
|
)
|
|
(1,384
|
)
|
Gain on sales of real estate assets
|
(5,323
|
)
|
|
(59,396
|
)
|
|
(2,887
|
)
|
Realized foreign currency loss
|
—
|
|
|
—
|
|
|
169
|
|
(Gain) loss on discontinued operations
|
(938
|
)
|
|
1
|
|
|
(379
|
)
|
Write-off of development projects
|
(39
|
)
|
|
94
|
|
|
392
|
|
Share-based compensation expense
|
3,740
|
|
|
1,783
|
|
|
2,313
|
|
Income tax effect of share-based compensation
|
—
|
|
|
—
|
|
|
(1,815
|
)
|
Net realized (gain) loss on sale of available-for-sale securities
|
(224
|
)
|
|
22
|
|
|
114
|
|
Write-down of mortgage and other notes receivable
|
—
|
|
|
1,900
|
|
|
—
|
|
Gain on investments
|
(45,072
|
)
|
|
—
|
|
|
(888
|
)
|
Loss on impairment of real estate from continuing operations
|
24,379
|
|
|
51,304
|
|
|
1,156
|
|
Loss on impairment of real estate from discontinued operations
|
26,461
|
|
|
7,425
|
|
|
39,084
|
|
Gain on extinguishment of debt
|
(265
|
)
|
|
(32,463
|
)
|
|
—
|
|
Equity in (earnings) losses of unconsolidated affiliates
|
(8,313
|
)
|
|
(6,138
|
)
|
|
188
|
|
Distributions of earnings from unconsolidated affiliates
|
17,074
|
|
|
9,586
|
|
|
4,959
|
|
Provision for doubtful accounts
|
1,523
|
|
|
1,743
|
|
|
2,891
|
|
Change in deferred tax accounts
|
3,095
|
|
|
(5,695
|
)
|
|
2,031
|
|
Changes in:
|
|
|
|
|
|
Tenant and other receivables
|
(2,150
|
)
|
|
(5,986
|
)
|
|
(6,693
|
)
|
Other assets
|
2,136
|
|
|
6,084
|
|
|
(1,215
|
)
|
Accounts payable and accrued liabilities
|
15,645
|
|
|
875
|
|
|
(5,600
|
)
|
Net cash provided by operating activities
|
481,515
|
|
|
441,836
|
|
|
429,792
|
|
CASH FLOWS FROM INVESTING ACTIVITIES:
|
|
|
|
|
|
Additions to real estate assets
|
(217,827
|
)
|
|
(205,379
|
)
|
|
(143,586
|
)
|
Acquisitions of real estate assets
|
(96,099
|
)
|
|
(11,500
|
)
|
|
—
|
|
(Additions) reductions to restricted cash
|
(1,063
|
)
|
|
(14,719
|
)
|
|
20,987
|
|
Additions to cash held in escrow
|
(15,000
|
)
|
|
—
|
|
|
—
|
|
Purchase of partners' interest in unconsolidated affiliates
|
(14,280
|
)
|
|
—
|
|
|
(15,773
|
)
|
Proceeds from sales of real estate assets
|
76,950
|
|
|
244,647
|
|
|
138,614
|
|
Additions to mortgage and other notes receivable
|
(3,584
|
)
|
|
(15,173
|
)
|
|
—
|
|
Payments received on mortgage notes receivable
|
3,002
|
|
|
7,479
|
|
|
1,609
|
|
Purchases of available-for-sale securities
|
—
|
|
|
—
|
|
|
(9,610
|
)
|
Additional investments in and advances to unconsolidated affiliates
|
(8,809
|
)
|
|
(35,499
|
)
|
|
(23,604
|
)
|
Distributions in excess of equity in earnings of unconsolidated affiliates
|
43,173
|
|
|
17,907
|
|
|
31,776
|
|
Changes in other assets
|
(13,133
|
)
|
|
(15,408
|
)
|
|
(5,971
|
)
|
Net cash used in investing activities
|
(246,670
|
)
|
|
(27,645
|
)
|
|
(5,558
|
)
|
|
|
|
|
|
|
CBL & Associates Properties, Inc.
Consolidated Statements of Cash Flows
(Continued)
(In thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year Ended December 31,
|
|
2012
|
|
2011
|
|
2010
|
CASH FLOWS FROM FINANCING ACTIVITIES:
|
|
|
|
|
|
Proceeds from mortgage and other indebtedness
|
$
|
1,869,140
|
|
|
$
|
1,933,770
|
|
|
$
|
893,378
|
|
Principal payments on mortgage and other indebtedness
|
(1,884,935
|
)
|
|
(2,086,461
|
)
|
|
(1,336,436
|
)
|
Additions to deferred financing costs
|
(7,384
|
)
|
|
(19,629
|
)
|
|
(4,855
|
)
|
Proceeds from issuances of common stock
|
172
|
|
|
179
|
|
|
153
|
|
Proceeds from issuances of preferred stock
|
166,720
|
|
|
—
|
|
|
229,347
|
|
Purchase of minority interest in the Operating Partnership
|
(9,863
|
)
|
|
—
|
|
|
—
|
|
Proceeds from exercises of stock options
|
4,454
|
|
|
1,955
|
|
|
1,456
|
|
Redemption of preferred stock
|
(115,000
|
)
|
|
—
|
|
|
—
|
|
Income tax effect of share-based compensation
|
—
|
|
|
—
|
|
|
1,815
|
|
Contributions from noncontrolling interests
|
7,120
|
|
|
2,079
|
|
|
5,234
|
|
Distributions to noncontrolling interests
|
(65,635
|
)
|
|
(75,468
|
)
|
|
(86,093
|
)
|
Dividends paid to holders of preferred stock
|
(43,738
|
)
|
|
(42,376
|
)
|
|
(35,670
|
)
|
Dividends paid to common shareholders
|
(133,740
|
)
|
|
(123,044
|
)
|
|
(89,729
|
)
|
Net cash used in financing activities
|
(212,689
|
)
|
|
(408,995
|
)
|
|
(421,400
|
)
|
|
|
|
|
|
|
NET CHANGE IN CASH AND CASH EQUIVALENTS
|
22,156
|
|
|
5,196
|
|
|
2,834
|
|
CASH AND CASH EQUIVALENTS, beginning of period
|
56,092
|
|
|
50,896
|
|
|
48,062
|
|
CASH AND CASH EQUIVALENTS, end of period
|
$
|
78,248
|
|
|
$
|
56,092
|
|
|
$
|
50,896
|
|
|
|
|
|
|
|
The accompanying notes are an integral part of these consolidated statements.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Dollars in thousands, except share data)
NOTE 1. ORGANIZATION
CBL, a Delaware corporation, is a self-managed, self-administered, fully-integrated REIT that is engaged in the ownership, development, acquisition, leasing, management and operation of regional shopping malls, open-air centers, associated centers, community centers and office properties. Its properties are located in
27
states, but are primarily in the southeastern and midwestern United States.
CBL conducts substantially all of its business through the Operating Partnership. As of
December 31, 2012
, the Operating Partnership owned controlling interests in
77
regional malls/open-air and outlet centers (including one mixed-use center),
28
associated centers (each located adjacent to a regional mall),
six
community centers and
13
office buildings, including CBL’s corporate office building. The Operating Partnership consolidates the financial statements of all entities in which it has a controlling financial interest or where it is the primary beneficiary of a VIE. At
December 31, 2012
, the Operating Partnership owned non-controlling interests in
nine
regional malls/ open-air centers,
four
associated centers,
four
community centers and
seven
office buildings. Because one or more of the other partners have substantive participating rights, the Operating Partnership does not control these partnerships and joint ventures and, accordingly, accounts for these investments using the equity method. The Operating Partnership had controlling interests in
one
outlet center, owned in a
75%
/
25%
joint venture, under construction at
December 31, 2012
. The Operating Partnership also had controlling interests in
one
community center,
one
mall expansion and
two
mall redevelopments under construction at
December 31, 2012
. The Operating Partnership also holds options to acquire certain development properties owned by third parties.
CBL is the
100%
owner of
two
qualified REIT subsidiaries, CBL Holdings I, Inc. and CBL Holdings II, Inc. At
December 31, 2012
, CBL Holdings I, Inc., the sole general partner of the Operating Partnership, owned a
1.0%
general partner interest in the Operating Partnership and CBL Holdings II, Inc. owned a
83.5%
limited partner interest for a combined interest held by CBL of
84.5%
.
The noncontrolling interest in the Operating Partnership is held primarily by CBL & Associates, Inc., its shareholders and affiliates and certain senior officers of the Company, all of which contributed their interests in certain real estate properties and joint ventures to the Operating Partnership in exchange for a limited partner interest when the Operating Partnership was formed in November 1993 (collectively “CBL’s Predecessor”). At
December 31, 2012
, CBL’s Predecessor owned a
9.5%
limited partner interest and various third parties owned a
6.0%
limited partner interest in the Operating Partnersh
ip. CBL’s Predecessor also owned
3.1 million
shares of CBL’s common stock at
December 31, 2012
, for a combined effective interest of
11.2%
in the Operating Partnership.
The Operating Partnership conducts CBL’s property management and development activities through its wholly-owned subsidiary, CBL & Associates Management, Inc. (the “Management Company”), to comply with certain requirements of the Internal Revenue Code.
CBL, the Operating Partnership and the Management Company are collectively referred to herein as “the Company.”
N
OTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Presentation
The accompanying consolidated financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”). All intercompany transactions have been eliminated.
Certain historical amounts have been reclassified to conform to the current year presentation. The financial results of certain Properties are reported as discontinued operations in the consolidated financial statements. Except where noted, the information presented in the Notes to Consolidated Financial Statements excludes discontinued operations.
Accounting Guidance Adopted
In May 2011, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2011-04,
Amendments to Achieve Common Fair Value Measurement and Disclosure Requirements in U.S. GAAP and IFRSs (
“ASU 2011-04”). The objective of ASU 2011-04 is to align fair value measurements and related disclosure requirements under GAAP and International Financial Reporting Standards (“IFRSs”), thus improving the comparability of fair value measurements presented and disclosed in financial statements prepared in accordance with U.S. GAAP and IFRSs. For public entities, this guidance was effective for interim and annual periods beginning after December 15, 2011 and should be applied prospectively. The adoption of ASU 2011-04 did not have a material impact on the Company's consolidated financial statements.
In June 2011, the FASB issued ASU No. 2011-05,
Presentation of Comprehensive Income
(“ASU 2011-05”). The objective of this accounting update is to improve the comparability, consistency, and transparency of financial reporting and to increase the prominence of items reported in other comprehensive income. This guidance eliminates the option to present the components of other comprehensive income as part of the statement of changes in stockholders' equity. ASU 2011-05 requires that all non-owner changes in stockholders' equity be presented either in a single continuous statement of comprehensive income or in two separate but continuous statements of net income and other comprehensive income. For public entities, this guidance was effective for interim and annual periods beginning after December 15, 2011 and should be applied retrospectively. In December 2011, the FASB issued ASU 2011-12,
Deferral of the Effective Date for Amendments to the Presentation of Reclassifications of Items Out of Accumulated Other Comprehensive Income in Accounting Standards Update No. 2011-05
(“ASU 2011-12”). This guidance defers the changes in ASU 2011-05 that relate to the presentation of reclassification adjustments out of accumulated other comprehensive income ("AOCI"). Other requirements of ASU 2011-05 are not affected by ASU 2011-12. The guidance in ASU 2011-12 was effective at the same time as ASU 2011-05 so that entities would not be required to comply with the presentation requirements in ASU 2011-05 that ASU 2011-12 deferred. The adoption of this guidance changed the presentation format of the Company's consolidated financial statements but did not have an impact on the amounts reported in those statements.
In December 2011, the FASB issued ASU No. 2011-10,
Derecognition of in Substance Real Estate - a Scope Clarification
(“ASU 2011-10”). This guidance applies to the derecognition of in substance real estate when the parent ceases to have a controlling financial interest in a subsidiary that is in substance real estate because of a default by the subsidiary on its nonrecourse debt. Under ASU 2011-10, the reporting entity should apply the guidance in Accounting Standards Codification ("ASC") 360-20,
Property, Plant and Equipment - Real Estate Sales
, to determine whether it should derecognize the in substance real estate. Generally, the requirements to derecognize in substance real estate would not be met before the legal transfer of the real estate to the lender and the extinguishment of the related nonrecourse indebtedness. Thus, even if the reporting entity ceases to have a controlling financial interest under ASC 810-10,
Consolidation - Overall
, it would continue to include the real estate, debt, and the results of the subsidiary's operations in its consolidated financial statements until legal title to the real estate is transferred to legally satisfy the debt. ASU 2011-10 should be applied on a prospective basis to deconsolidation events occurring after the effective date. For public companies, this guidance is effective for fiscal years, and interim periods within those years, beginning on or after June 15, 2012. Early adoption is permitted. The Company elected to adopt ASU 2011-10 effective January 1, 2012. The adoption of this guidance did not have an impact on the Company's consolidated financial statements.
Accounting Pronouncements Not Yet Effective
In February 2013, the FASB issued ASU 2013-02,
Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive Income
("ASU 2013-02"). The objective of ASU 2013-02 is to improve reporting of reclassifications out of AOCI by presenting information about such reclassifications and their corresponding effect on net income primarily in one place either on the face of the financial statements or in the notes. ASU 2013-02 requires an entity to disclose information by component for significant amounts reclassified out of AOCI if the amounts reclassified are required to be reclassified under GAAP to net income in their entirety in the same reporting period. For amounts not required under GAAP to be reclassified in their entirety to net income, an entity is required to cross-reference to other disclosures that provide additional details about those amounts. ASU 2013-02 established the effective date and guidance for the presentation of reclassification adjustments which ASU 2011-12 deferred. For public companies, this guidance is effective on a prospective basis for fiscal years, and interim periods within those years, beginning after December 15, 2012. ASU 2013-02 does not change the calculation of net income or comprehensive income and will not have an impact on the amounts reported in the Company's consolidated financial statements.
Real Estate Assets
The Company capitalizes predevelopment project costs paid to third parties. All previously capitalized predevelopment costs are expensed when it is no longer probable that the project will be completed. Once development of a project commences, all direct costs incurred to construct the project, including interest and real estate taxes, are capitalized. Additionally, certain general and administrative expenses are allocated to the projects and capitalized based on the amount of time applicable personnel work on the development project. Ordinary repairs and maintenance are expensed as incurred. Major replacements and improvements are capitalized and depreciated over their estimated useful lives.
All acquired real estate assets have been accounted for using the acquisition method of accounting and accordingly, the results of operations are included in the consolidated statements of operations from the respective dates of acquisition. The Company allocates the purchase price to (i) tangible assets, consisting of land, buildings and improvements, as if vacant, and tenant improvements, and (ii) identifiable intangible assets and liabilities, generally consisting of above-market leases, in-place leases and tenant relationships, which are included in other assets, and below-market leases, which are included in accounts payable and accrued liabilities. The Company uses estimates of fair value based on estimated cash flows, using appropriate discount rates, and other valuation techniques to allocate the purchase price to the acquired tangible and intangible assets. Liabilities assumed generally consist of mortgage debt on the real estate assets acquired. Assumed debt is recorded at its fair value based on estimated market interest rates at the date of acquisition.
Depreciation is computed on a straight-line basis over estimated lives of
40
years for buildings,
10 to 20
years for certain improvements and
7 to 10
years for equipment and fixtures. Tenant improvements are capitalized and depreciated on a straight-line basis over the term of the related lease. Lease-related intangibles from acquisitions of real estate assets are generally amortized over the remaining terms of the related leases. The amortization of above- and below-market leases is recorded as an adjustment to minimum rental revenue, while the amortization of all other lease-related intangibles is recorded as amortization expense. Any difference between the face value of the debt assumed and its fair value is amortized to interest expense over the remaining term of the debt using the effective interest method.
The Company’s intangibles and their balance sheet classifications as of
December 31, 2012
and
2011
, are summarized as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31, 2012
|
|
December 31, 2011
|
|
Cost
|
|
Accumulated
Amortization
|
|
Cost
|
|
Accumulated
Amortization
|
Intangible lease assets and other assets:
|
|
|
|
|
|
|
|
Above-market leases
|
$
|
69,360
|
|
|
$
|
(37,454
|
)
|
|
$
|
55,642
|
|
|
$
|
(33,954
|
)
|
In-place leases
|
117,631
|
|
|
(46,767
|
)
|
|
54,838
|
|
|
(36,753
|
)
|
Tenant relationships
|
27,880
|
|
|
(3,350
|
)
|
|
27,318
|
|
|
(2,853
|
)
|
Accounts payable and accrued liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
Below-market leases
|
104,012
|
|
|
(57,625
|
)
|
|
66,627
|
|
|
(51,755
|
)
|
These intangibles are related to specific tenant leases. Should a termination occur earlier than the date indicated in the lease, the related intangible assets or liabilities, if any, related to the lease are recorded as expense or income, as applicable. The increase in net carrying value of intangibles from December 31, 2011 to December 31, 2012 was primarily due to the 2012 acquisitions of Dakota Square Mall, The Outlet Shoppes at Gettysburg and The Outlet Shoppes at El Paso as described in
Note 3
. The total net amortization expense of the above intangibles was
$10,550
,
$7,137
and
$8,224
in
2012
,
2011
and
2010
, respectively. The estimated total net amortization expense for the next five succeeding years is
$17,488
in 2013,
$13,921
in 2014,
$10,885
in 2015,
$6,541
in 2016 and
$4,848
in 2017.
Total interest expense capitalized was
$2,671
,
$4,955
and
$3,334
in
2012
,
2011
and
2010
, respectively.
Carrying Value of Long-Lived Assets
The Company evaluates the carrying value of long-lived assets to be held and used when events or changes in circumstances warrant such a review. The carrying value of a long-lived asset is considered impaired when its estimated future undiscounted cash flows are less than its carrying value. The Company estimates fair value using the undiscounted cash flows expected to be generated by each Property, which are based on a number of assumptions such as leasing expectations, operating budgets, estimated useful lives, future maintenance expenditures, intent to hold for use and capitalization rates. If it is determined that impairment has occurred, the amount of the impairment charge is equal to the excess of the asset’s carrying value over its estimated fair value. These assumptions are subject to economic and market uncertainties including, but not limited to, demand for space, competition for tenants, changes in market rental rates and costs to operate each Property. As these factors are difficult to predict and are subject to future events that may alter the assumptions used, the future cash flows estimated in the Company’s impairment analyses may not be achieved. See
Note 4
and
Note 15
for information related to the impairment of long-lived assets for
2012
,
2011
and
2010
.
Cash and Cash Equivalents
The Company considers all highly liquid investments with original maturities of three months or less as cash equivalents.
Restricted Cash
Restricted cash of
$42,880
and
$41,817
was included in intangible lease assets and other assets at
December 31, 2012
and
2011
, respectively. Restricted cash consists primarily of cash held in escrow accounts for debt service, insurance, real estate taxes, capital improvements and deferred maintenance as required by the terms of certain mortgage notes payable, as well as contributions from tenants to be used for future marketing activities. The Company’s restricted cash included
$110
and
$117
as of
December 31, 2012
and
2011
, respectively, related to funds held in a trust account for certain construction costs associated with our developments.
Allowance for Doubtful Accounts
The Company periodically performs a detailed review of amounts due from tenants to determine if accounts receivable balances are realizable based on factors affecting the collectibility of those balances. The Company’s estimate of the allowance for doubtful accounts requires management to exercise significant judgment about the timing, frequency and severity of collection losses, which affects the allowance and net income. The Company recorded a provision for doubtful accounts of
$1,523
,
$1,682
and
$2,726
for
2012
,
2011
and
2010
, respectively.
Investments in Unconsolidated Affiliates
The Company evaluates its joint venture arrangements to determine whether they should be recorded on a consolidated basis. The percentage of ownership interest in the joint venture, an evaluation of control and whether a VIE exists are all considered in the Company’s consolidation assessment.
Initial investments in joint ventures that are in economic substance a capital contribution to the joint venture are recorded in an amount equal to the Company’s historical carryover basis in the real estate contributed. Initial investments in joint ventures that are in economic substance the sale of a portion of the Company’s interest in the real estate are accounted for as a contribution of real estate recorded in an amount equal to the Company’s historical carryover basis in the ownership percentage retained and as a sale of real estate with profit recognized to the extent of the other joint venturers’ interests in the joint venture. Profit recognition assumes the Company has no commitment to reinvest with respect to the percentage of the real estate sold and the accounting requirements of the full accrual method are met.
The Company accounts for its investment in joint ventures where it owns a non-controlling interest or where it is not the primary beneficiary of a VIE using the equity method of accounting. Under the equity method, the Company’s cost of investment is adjusted for its share of equity in the earnings of the unconsolidated affiliate and reduced by distributions received. Generally, distributions of cash flows from operations and capital events are first made to partners to pay cumulative unpaid preferences on unreturned capital balances and then to the partners in accordance with the terms of the joint venture agreements.
Any differences between the cost of the Company’s investment in an unconsolidated affiliate and its underlying equity as reflected in the unconsolidated affiliate’s financial statements generally result from costs of the Company’s investment that are not reflected on the unconsolidated affiliate’s financial statements, capitalized interest on its investment and the Company’s share of development and leasing fees that are paid by the unconsolidated affiliate to the Company for development and leasing services provided to the unconsolidated affiliate during any development periods. At
December 31, 2012
and
2011
, the net difference between the Company’s investment in unconsolidated affiliates and the underlying equity of unconsolidated affiliates was
$11,674
and
$2,456
, respectively, which is generally amortized over a period of
40
years.
On a periodic basis, the Company assesses whether there are any indicators that the fair value of the Company's investments in unconsolidated affiliates may be impaired. An investment is impaired only if the Company’s estimate of the fair value of the investment is less than the carrying value of the investment and such decline in value is deemed to be other than temporary. To the extent impairment has occurred, the loss is measured as the excess of the carrying amount of the investment over the estimated fair value of the investment. The Company's estimates of fair value for each investment are based on a number of assumptions that are subject to economic and market uncertainties including, but not limited to, demand for space, competition for tenants, changes in market rental rates, and operating costs. As these factors are difficult to predict and are subject to future events that may alter the Company’s assumptions, the fair values estimated in the impairment analyses may not be realized.
No impairments of investments in unconsolidated affiliates were recorded in 2012, 2011 and 2010. See
Note 5
for further discussion.
Deferred Financing Costs
Net deferred financing costs of
$24,821
and
$27,674
were included in intangible lease assets and other assets at
December 31, 2012
and
2011
, respectively. Deferred financing costs include fees and costs incurred to obtain financing and are amortized on a straight-line basis to interest expense over the terms of the related indebtedness. Amortization expense was
$10,391
,
$12,933
and
$12,223
in
2012
,
2011
and
2010
, respectively. Accumulated amortization was
$8,932
and
$17,781
as of
December 31, 2012
and
2011
, respectively.
Marketable Securities
Intangible lease assets and other assets include marketable securities consisting of corporate equity securities, mortgage / asset-backed securities, mutual funds and bonds that are classified as available for sale. Unrealized gains and losses on available-for-sale securities that are deemed to be temporary in nature are recorded as a component of accumulated other comprehensive income (loss) in redeemable noncontrolling interests, shareholders’ equity and noncontrolling interests. Realized gains and losses are recorded in other income. Gains or losses on securities sold are based on the specific identification method. The Company recognized net realized gains on sales of available-for-sale securities of
$224
in
2012
and net realized losses on sales of available-for-sale securities of
$22
and
$114
in
2011
and
2010
, respectively.
If a decline in the value of an investment is deemed to be other than temporary, the investment is written down to fair value and an impairment loss is recognized in the current period to the extent of the decline in value. In determining when a decline in fair value below cost of an investment in marketable securities is other than temporary, the following factors, among others, are evaluated:
|
|
•
|
The probability of recovery.
|
|
|
•
|
The Company’s ability and intent to retain the security for a sufficient period of time for it to recover.
|
|
|
•
|
The significance of the decline in value.
|
|
|
•
|
The time period during which there has been a significant decline in value.
|
|
|
•
|
Current and future business prospects and trends of earnings.
|
|
|
•
|
Relevant industry conditions and trends relative to their historical cycles.
|
There were
no
other-than-temporary impairments of marketable securities incurred during
2012
,
2011
and
2010
.
The following is a summary of the marketable securities held by the Company as of
December 31, 2012
and
2011
:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross Unrealized
|
|
|
|
Adjusted Cost
|
|
Gains
|
|
Losses
|
|
Fair Value
|
December 31, 2012:
|
|
|
|
|
|
|
|
Common stocks
|
$
|
4,195
|
|
|
$
|
12,361
|
|
|
$
|
—
|
|
|
$
|
16,556
|
|
Government and government
sponsored entities
|
11,123
|
|
|
—
|
|
|
—
|
|
|
11,123
|
|
|
$
|
15,318
|
|
|
$
|
12,361
|
|
|
$
|
—
|
|
|
$
|
27,679
|
|
|
|
|
|
|
|
|
|
December 31, 2011:
|
|
|
|
|
|
|
|
|
|
|
|
Common stocks
|
$
|
4,207
|
|
|
$
|
9,480
|
|
|
$
|
(5
|
)
|
|
$
|
13,682
|
|
Mutual funds
|
928
|
|
|
23
|
|
|
—
|
|
|
951
|
|
Mortgage/asset-backed securities
|
1,717
|
|
|
10
|
|
|
(4
|
)
|
|
1,723
|
|
Government and government
sponsored entities
|
15,058
|
|
|
45
|
|
|
(1,542
|
)
|
|
13,561
|
|
Corporate bonds
|
636
|
|
|
26
|
|
|
—
|
|
|
662
|
|
International bonds
|
33
|
|
|
1
|
|
|
—
|
|
|
34
|
|
|
$
|
22,579
|
|
|
$
|
9,585
|
|
|
$
|
(1,551
|
)
|
|
$
|
30,613
|
|
Interest Rate Hedging Instruments
The Company recognizes its derivative financial instruments in either accounts payable and accrued liabilities or intangible lease assets and other assets, as applicable, in the consolidated balance sheets and measures those instruments at fair value. The accounting for changes in the fair value (i.e., gain or loss) of a derivative depends on whether it has been designated and qualifies as part of a hedging relationship, and further, on the type of hedging relationship. To qualify as a hedging instrument, a derivative must pass prescribed effectiveness tests, performed quarterly using both qualitative and quantitative methods. The Company has entered into derivative agreements as of
December 31, 2012
and
2011
that qualify as hedging instruments and were designated, based upon the exposure being hedged, as cash flow hedges. The fair value of these cash flow hedges as of
December 31, 2012
and
2011
was
$5,805
and
$5,617
, respectively, and is included in accounts payable and accrued liabilities in the accompanying consolidated balance sheets. To the extent they are effective, changes in the fair values of cash flow hedges are reported in other comprehensive income (loss) and reclassified into earnings in the same period or periods during which the hedged item affects earnings. The ineffective portion of the hedge, if any, is recognized in current earnings during the period of change in fair value. The gain or loss on the termination of an effective cash flow hedge is reported in other comprehensive income (loss) and reclassified into earnings in the same period or periods during which the hedged item affects earnings. The Company also assesses the credit risk that the counterparty will not perform according to the terms of the contract.
See
Notes 6
and
15
for additional information regarding the Company’s interest rate hedging instruments.
Revenue Recognition
Minimum rental revenue from operating leases is recognized on a straight-line basis over the initial terms of the related leases. Certain tenants are required to pay percentage rent if their sales volumes exceed thresholds specified in their lease agreements. Percentage rent is recognized as revenue when the thresholds are achieved and the amounts become determinable.
The Company receives reimbursements from tenants for real estate taxes, insurance, common area maintenance, and other recoverable operating expenses as provided in the lease agreements. Tenant reimbursements are recognized when earned in accordance with the tenant lease agreements. Tenant reimbursements related to certain capital expenditures are billed to tenants over periods of
5
to
15
years and are recognized as revenue in accordance with underlying lease terms.
The Company receives management, leasing and development fees from third parties and unconsolidated affiliates. Management fees are charged as a percentage of revenues (as defined in the management agreement) and are recognized as revenue when earned. Development fees are recognized as revenue on a pro rata basis over the development period. Leasing fees are charged for newly executed leases and lease renewals and are recognized as revenue when earned. Development and leasing fees received from an unconsolidated affiliate during the development period are recognized as revenue only to the extent of the third-party partner’s ownership interest. Development and leasing fees during the development period to the extent of the Company’s ownership interest are recorded as a reduction to the Company’s investment in the unconsolidated affiliate.
Gains on Sales of Real Estate Assets
Gains on sales of real estate assets are recognized when it is determined that the sale has been consummated, the buyer’s initial and continuing investment is adequate, the Company’s receivable, if any, is not subject to future subordination, and the buyer has assumed the usual risks and rewards of ownership of the asset. When the Company has an ownership interest in the buyer, gain is recognized to the extent of the third party partner’s ownership interest and the portion of the gain attributable to the Company’s ownership interest is deferred.
Income Taxes
The Company is qualified as a REIT under the provisions of the Internal Revenue Code. To maintain qualification as a REIT, the Company is required to distribute at least
90%
of its taxable income to shareholders and meet certain other requirements.
As a REIT, the Company is generally not liable for federal corporate income taxes. If the Company fails to qualify as a REIT in any taxable year, the Company will be subject to federal and state income taxes on its taxable income at regular corporate tax rates. Even if the Company maintains its qualification as a REIT, the Company may be subject to certain state and local taxes on its income and property, and to federal income and excise taxes on its undistributed income. State tax expense was
$3,795
,
$4,063
and
$4,663
during
2012
,
2011
and
2010
, respectively.
The Company has also elected taxable REIT subsidiary status for some of its subsidiaries. This enables the Company to receive income and provide services that would otherwise be impermissible for REITs. For these entities, deferred tax assets and liabilities are established for temporary differences between the financial reporting basis and the tax basis of assets and liabilities at the enacted tax rates expected to be in effect when the temporary differences reverse. A valuation allowance for deferred tax assets is provided if the Company believes all or some portion of the deferred tax asset may not be realized. An increase or decrease in the valuation allowance that results from the change in circumstances that causes a change in our judgment about the realizability of the related deferred tax asset is included in income or expense, as applicable. The Company recorded an income tax provision of
$1,404
in
2012
and an income tax benefit of
$269
and
$6,417
in
2011
and
2010
respectively. The income tax provision in
2012
consisted of a current income tax benefit of
$1,691
and a deferred income tax provision of
$3,095
. The income tax benefit in
2011
consisted of a current income tax provision of
$5,426
and a deferred income tax benefit of
$5,695
. The income tax benefit in
2010
consisted of a current income tax benefit of
$8,448
and a deferred income tax provision of
$2,031
,
The Company had a net deferred tax asset of
$6,607
and
$8,012
at
December 31, 2012
and
2011
, respectively. The net deferred tax asset at
December 31, 2012
and
2011
is included in intangible lease assets and other assets and primarily consisted of operating expense accruals and differences between book and tax depreciation. As of
December 31, 2012
, tax years that generally remain subject to examination by the Company’s major tax jurisdictions include 2009, 2010, 2011 and 2012.
The Company reports any income tax penalties attributable to its properties as property operating expenses and any corporate-related income tax penalties as general and administrative expenses in its statement of operations. In addition, any interest incurred on tax assessments is reported as interest expense. The Company reported nominal interest and penalty amounts in 2012, 2011 and 2010.
Concentration of Credit Risk
The Company’s tenants include national, regional and local retailers. Financial instruments that subject the Company to concentrations of credit risk consist primarily of tenant receivables. The Company generally does not obtain collateral or other security to support financial instruments subject to credit risk, but monitors the credit standing of tenants.
The Company derives a substantial portion of its rental income from various national and regional retail companies; however, no single tenant collectively accounted for more than
3.2%
of the Company’s total revenues in
2012
,
2011
or
2010
.
Earnings Per Share
Basic earnings per share ("EPS") is computed by dividing net income available to common shareholders by the weighted-average number of common shares outstanding for the period. Diluted EPS assumes the issuance of common stock for all potential dilutive common shares outstanding. The limited partners’ rights to convert their noncontrolling interests in the Operating Partnership into shares of common stock are not dilutive.
The following summarizes the impact of potential dilutive common shares on the denominator used to compute EPS:
|
|
|
|
|
|
|
|
|
|
|
Year Ended December 31,
|
|
2012
|
|
2011
|
|
2010
|
Denominator – basic
|
154,762
|
|
|
148,289
|
|
|
138,375
|
|
Stock Options
|
3
|
|
|
3
|
|
|
2
|
|
Deemed shares related to deferred compensation arrangements
|
42
|
|
|
42
|
|
|
39
|
|
Denominator – diluted
|
154,807
|
|
|
148,334
|
|
|
138,416
|
|
There was no anti-dilutive effect of stock options in 2012. The dilutive effect of stock options of
23
and
61
shares for the years ended
December 31, 2011
, and
2010
, respectively, were excluded from the computations of diluted EPS because the effect of including the stock options would have been anti-dilutive.
See
Note 7
for information regarding significant equity offerings that affected per share amounts for each period presented.
Comprehensive Income
Comprehensive income includes all changes in redeemable noncontrolling interests and total equity during the period, except those resulting from investments by shareholders and partners, distributions to shareholders and partners and redemption valuation adjustments. Other comprehensive income (loss) (“OCI/L”) includes changes in unrealized gains (losses) on available-for-sale securities, interest rate hedge agreements and foreign currency translation adjustments.
The components of accumulated other comprehensive income (loss) as of
December 31, 2012
and
2011
are as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31, 2012
|
|
As reported in:
|
|
|
|
Redeemable Noncontrolling Interests
|
|
Shareholders' Equity
|
|
Noncontrolling Interests
|
|
Total
|
Net unrealized gain (loss) on hedging agreements
|
$
|
373
|
|
|
$
|
(2,756
|
)
|
|
$
|
(3,563
|
)
|
|
$
|
(5,946
|
)
|
Net unrealized gain on available-for-sale securities
|
353
|
|
|
9,742
|
|
|
2,263
|
|
|
12,358
|
|
Accumulated other comprehensive income (loss)
|
$
|
726
|
|
|
$
|
6,986
|
|
|
$
|
(1,300
|
)
|
|
$
|
6,412
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31, 2011
|
|
As reported in:
|
|
|
|
Redeemable Noncontrolling Interests
|
|
Shareholders' Equity
|
|
Noncontrolling Interests
|
|
Total
|
Net unrealized gain (loss) on hedging agreements
|
$
|
377
|
|
|
$
|
(2,628
|
)
|
|
$
|
(3,488
|
)
|
|
$
|
(5,739
|
)
|
Net unrealized gain on available-for-sale securities
|
328
|
|
|
6,053
|
|
|
1,775
|
|
|
8,156
|
|
Accumulated other comprehensive income (loss)
|
$
|
705
|
|
|
$
|
3,425
|
|
|
$
|
(1,713
|
)
|
|
$
|
2,417
|
|
Use of Estimates
The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reported period. Actual results could differ from those estimates.
NOTE 3. ACQUISITIONS
The Company includes the results of operations of real estate assets acquired in the consolidated statements of operations from the date of the related acquisition.
2012 Acquisitions
In
December 2012
, the Company acquired a
49.0%
joint venture interest in Kirkwood Mall in Bismarck, ND. The Company paid
$39,754
for its
49.0%
share, which was based on a total value of
$121,500
including a
$40,368
non-recourse loan. The Company executed an agreement to acquire the remaining
51.0%
interest within 90 days subject to the lender's approval to assume the loan, which bears interest of
5.75%
and matures in
April 2018
. As the loan bears interest at an above-market rate, the Company recorded a debt premium of
$2,970
, computed using an estimated market interest rate of
4.25%
.
In
May 2012
, the Company
acquired Dakota Square Mall in Minot, ND. The purchase price of
$91,475
consisted of
$32,474
in cash and the assumption of a
$59,001
non-recourse loan that bears interest at a fixed rate of
6.23%
and matures in
November 2016
. The Company recorded a debt premium of
$3,040
, computed using an estimated market interest rate of
4.75%
, since the debt assumed was at an above-market interest rate compared to similar debt instruments at the date of acquisition.
In
April 2012
, the Company and its noncontrolling interest partner exercised their rights under the terms of a mezzanine loan agreement with the borrower, which owned The Outlet Shoppes at Gettysburg in Gettysburg, PA, to convert the mezzanine loan into a member interest in the outlet shopping center. After conversion, the Company owns a
50.0%
interest in the outlet center. The investment of
$24,837
consisted of a
$4,522
converted mezzanine loan and the assumption of
$20,315
of debt. The
$40,631
of debt, of which our share is
50.0%
, bears interest at a fixed rate of
5.87%
and matures in
February 2016
.
In
April 2012
, the Company acquired a
75.0%
joint venture interest in The Outlet Shoppes at El Paso, an outlet shopping center located in El Paso, TX for
$31,592
and a
50.0%
joint venture interest in outparcel land adjacent to The Outlet Shoppes at El Paso (see
Note 5
) for
$3,864
for a total of
$35,456
. The amount paid for the Company's
75.0%
and
50.0%
interests was based on a total value of
$116,775
including a non-recourse loan of
$66,924
, which bears interest at a fixed rate of
7.06%
and matures in
December 2017
. The debt assumed was at an above-market rate compared to similar debt instruments at the date of acquisition, so the Company recorded a debt premium of
$7,700
(of which
$5,775
represents the Company's
75.0%
share), computed using an estimated market interest rate of
4.75%
. The entity that owned The Outlet Shoppes at El Paso used a portion of the cash proceeds to repay a
$9,150
mezzanine loan provided by the Company. After considering the repayment of the mezzanine loan to the Company, the net consideration paid by the Company in connection with this transaction was
$28,594
.
The following table summarizes the preliminary allocation of the estimated fair values of the assets acquired and liabilities assumed as of the acquisition date for acquisitions listed above as of
December 31, 2012
:
|
|
|
|
|
|
Land
|
|
$
|
41,878
|
|
Buildings and improvements
|
|
309,827
|
|
Investments in unconsolidated affiliates
|
|
3,864
|
|
Tenant improvements
|
|
13,603
|
|
Above-market leases
|
|
11,069
|
|
In-place leases
|
|
49,521
|
|
Total assets
|
|
429,762
|
|
Mortgage note payable assumed
|
|
(206,924
|
)
|
Debt premium
|
|
(13,710
|
)
|
Below-market leases
|
|
(36,627
|
)
|
Noncontrolling interest
|
|
(60,295
|
)
|
Net assets acquired
|
|
$
|
112,206
|
|
In
December 2012
, the Company acquired the remaining
40.0%
interests in Imperial Valley Mall L.P., Imperial Valley Peripheral L.P. and Imperial Valley Commons L.P. in El Centro, CA from its joint venture partner. Imperial Valley Commons, L.P. was classified as a variable interest entity prior to the acquisition of the remaining
40.0%
interest and was accounted for on a consolidated basis. We recorded a gain on investment of
$45,072
related to the acquisition of our joint venture partner's interest. Imperial Valley Mall L.P. and Imperial Valley Peripheral L.P. were unconsolidated affiliates accounted for using the equity method of accounting. As of the purchase date, all three joint ventures are accounted for on a consolidated basis in the Company's operations. The interests were acquired for total consideration of
$36,518
, which consists of
$15,500
in cash and
$21,018
related to the assumption of the joint venture partner's share of the loan secured by Imperial Valley Mall. The following table summarizes the preliminary allocation of the estimated fair values of the assets acquired and liabilities assumed as of the acquisition date for Imperial Valley Mall as of
December 31, 2012
:
|
|
|
|
|
|
Land
|
|
$
|
46,188
|
|
Buildings and improvements
|
|
68,723
|
|
Tenant improvements
|
|
1,826
|
|
Above-market leases
|
|
4,382
|
|
In-place leases
|
|
17,591
|
|
Total assets
|
|
138,710
|
|
Mortgage note payable assumed
|
|
(52,546
|
)
|
Debt premium
|
|
(1,624
|
)
|
Below-market leases
|
|
(3,546
|
)
|
Value of Company's interest in joint ventures
|
|
(65,494
|
)
|
Net assets acquired
|
|
$
|
15,500
|
|
The Company has not yet finalized its allocation of the purchase price of Kirkwood Mall and Imperial Valley Mall, included in the tables above, as it is awaiting certain valuation information for assets acquired and liabilities assumed to complete its allocations. A final determination of the purchase price allocation will be made in 2013. The pro forma effect of the 2012 acquisitions described above was not material.
2011 Acquisition
In September 2011, the Company purchased Northgate Mall located in Chattanooga, TN, for a total cash purchase price of
$11,500
plus transaction costs of
$672
. The results of operations of Northgate Mall are included in the consolidated financial statements beginning on the date of acquisition. The following table summarizes the estimated fair values of the assets acquired and liabilities assumed as of the acquisition date:
|
|
|
|
|
|
Land
|
|
$
|
2,330
|
|
Buildings and improvements
|
|
8,220
|
|
Above-market leases
|
|
2,030
|
|
In-place leases
|
|
1,570
|
|
Total assets
|
|
14,150
|
|
Below-market leases
|
|
(2,650
|
)
|
Net assets acquired
|
|
$
|
11,500
|
|
|
|
|
2010 Acquisition
In October 2010, the Company acquired the remaining
50%
interest in Parkway Place in Huntsville, AL, from its joint venture partner. The interest was acquired for total consideration of
$38,775
, which consisted of
$17,831
in a combination of cash paid by the Company and a distribution from the joint venture to the joint venture partner and the assumption of the joint venture partner’s share of the loan secured by Parkway Place with a principal balance of
$20,944
at the time of purchase.
NOTE 4. DISCONTINUED OPERATIONS
The results of operations of the Properties described below, as well as any gains or impairment losses related to these Properties, are included in discontinued operations for all periods presented, as applicable.
In the fourth quarter of 2012, the Company determined that
two
office buildings met the criteria to be classified as held for sale as of December 31, 2012. These Properties were sold in January 2013. See
Note 20
for additional information.
In December 2012, the Company sold Willowbrook Plaza, a community center located in Houston, TX, for a gross sales price of
$24,450
less commissions and customary closing costs for a net sales price of
$24,171
. Proceeds from the sale were used to reduce the outstanding borrowings on the Company's credit facilities. In accordance with the Company's quarterly impairment review process, the Company recorded a loss on impairment of real estate of
$17,743
during the third quarter of 2012 to write down the book value of this Property to its then estimated fair value.
In October 2012, the Company sold Towne Mall, located in Franklin, OH and Hickory Hollow Mall, located in Antioch, TN. Towne Mall sold for a gross sales price of
$950
less commissions and customary closings costs for a net sales price of
$892
. Hickory Hollow Mall sold for a gross sales price of
$1,000
less commissions and customary closing costs for a net sales price of
$966
. Net proceeds from the sale of both malls were used to reduce the outstanding borrowings on the Company's credit facilities. In the third quarter of 2012, the Company recorded a loss on impairment of real estate of
$419
and
$8,047
, respectively, to write down the book value of both Properties to the expected net sales price.
In July 2012, the Company sold Massard Crossing, a community center located in Fort Smith, AR, for a gross sales price of
$7,803
less commissions and customary closing costs for a net sales price of
$7,432
. Proceeds from the sale were used to reduce the outstanding borrowings on the Company's credit facilities. The Company recorded a gain of
$98
attributable to the sale in the third quarter of 2012.
In March 2012, the Company completed the sale of the second phase of Settlers Ridge, a community center located in Robinson Township, PA, for a gross sales price of
$19,144
less commissions and customary closing costs for a net sales price of
$18,951
. Proceeds from the sale were used to reduce the outstanding borrowings on the Company's credit facilities. The Company recorded a gain of
$883
attributable to the sale in the first quarter of 2012. The Company recorded a loss on impairment of real estate of
$4,457
in the second quarter of 2011 to write down the book value of this Property to its then estimated fair value. There were no results of operations for this Property for the year ended December 31, 2010 as it was under development during that period.
In January 2012, the Company sold Oak Hollow Square, a community center located in High Point, NC, for a gross sales price of
$14,247
. Net proceeds of
$13,796
were used to reduce the outstanding balance on the Company's unsecured term loan. The Company recorded a loss on impairment of real estate of
$255
in the first quarter of 2012 related to the true-up of certain estimated amounts to actual amounts. The Company recorded a loss on impairment of real estate of
$729
in the fourth quarter of 2011 to write down the book value of this Property to the estimated net sales price.
In November 2011, the Company completed the sale of Westridge Square, a community center located in Greensboro, NC, for a sales price of
$26,125
less commissions and customary closing costs for a net sales price of
$25,768
. Proceeds from the sale were used to reduce the outstanding borrowings on the unsecured term facility used to acquire the Starmount Properties.
In February 2011, the Company completed the sale of Oak Hollow Mall in High Point, NC, for a gross sales price of
$9,000
. Net proceeds from the sale were used to retire the outstanding principal balance and accrued interest of
$40,281
on the non-recourse loan secured by the Property in accordance with the lender’s agreement to modify the outstanding principal balance and accrued interest to equal the net sales price for the Property and, as a result, the Company recorded a gain on the extinguishment of debt of
$31,434
in the first quarter of 2011. The Company also recorded a loss on impairment of real estate in the first quarter of 2011 of
$2,746
to write down the book value of the Property to the net sales price. In the second quarter of 2010, the Company recorded a loss on impairment of real estate of
$25,435
related to the Property to write down its depreciated book value to its then estimated fair value.
In October 2010, the Company completed the sale of Pemberton Square, a mall located in Vicksburg, MS, for a sales price of
$1,863
less commissions and customary closing costs for a net sales price of
$1,782
. The Company recorded a gain of
$379
attributable to the sale in the fourth quarter of 2010. Proceeds from the sale were used to reduce the outstanding borrowings on the Company’s credit facilities.
In December 2010, the Company completed the sale of Milford Marketplace, a community center located in Milford, CT, and the conveyance of its ownership interest in the first phase of Settlers Ridge, a community center located in Robinson Township, PA, for a sales price of
$111,835
less commissions and customary closing costs for a net sales price of
$110,709
. The Company recorded a loss on impairment of real estate of
$12,363
in the fourth quarter of 2010 to reflect the fair value of the Properties at the time of the sale. Net proceeds from the sale, after repayment of a construction loan, were used to reduce the
outstanding borrowings on the Company’s credit facilities.
In December 2010, the Company completed the sale of Lakeview Pointe, a community center located in Stillwater, OK, for a sales price of
$21,000
less commissions and customary closing costs for a net sales price of
$20,631
. The Company recorded a loss on impairment of real estate of
$1,302
in the fourth quarter of 2010 to reflect the fair value of the Property at the time of sale. Net proceeds from the sale, after repayment of a construction loan, were used to reduce the outstanding borrowings on the Company’s secured credit facilities.
Total revenues of the centers described above that are included in discontinued operations were
$12,115
,
$20,194
and
$32,452
in
2012
,
2011
and
2010
, respectively. The total net investment in real estate assets at the time of sale for the centers sold during
2012
was
$51,184
. There were no outstanding loans on any of the centers sold during 2012. Discontinued operations for the years ended
December 31, 2012
,
2011
and
2010
also include true-ups of estimated expense to actual amounts for Properties sold during previous years.
NOTE 5. UNCONSOLIDATED AFFILIATES AND COST METHOD INVESTMENTS
Unconsolidated Affiliates
At
December 31, 2012
, the Company had investments in the following
16
entities, which are accounted for using the equity method of accounting:
|
|
|
|
|
Joint Venture
|
Property Name
|
Company's
Interest
|
CBL/T-C, LLC
|
CoolSprings Galleria, Oak Park Mall, West County Center and Pearland Town Center
|
60.3
|
%
|
CBL-TRS Joint Venture, LLC
|
Friendly Center, The Shops at Friendly Center and a portfolio of six office buildings
|
50.0
|
%
|
CBL-TRS Joint Venture II, LLC
|
Renaissance Center
|
50.0
|
%
|
El Paso Outlet Outparcels, LLC
|
The Outlet Shoppes at El Paso (vacant land)
|
50.0
|
%
|
Governor’s Square IB
|
Governor’s Plaza
|
50.0
|
%
|
Governor’s Square Company
|
Governor’s Square
|
47.5
|
%
|
High Pointe Commons, LP
|
High Pointe Commons
|
50.0
|
%
|
High Pointe Commons II-HAP, LP
|
High Pointe Commons - Christmas Tree Shop
|
50.0
|
%
|
JG Gulf Coast Town Center LLC
|
Gulf Coast Town Center
|
50.0
|
%
|
Kentucky Oaks Mall Company
|
Kentucky Oaks Mall
|
50.0
|
%
|
Mall of South Carolina L.P.
|
Coastal Grand—Myrtle Beach
|
50.0
|
%
|
Mall of South Carolina Outparcel L.P.
|
Coastal Grand—Myrtle Beach (Coastal Grand Crossing and vacant land)
|
50.0
|
%
|
Port Orange I, LLC
|
The Pavilion at Port Orange Phase I
|
50.0
|
%
|
Triangle Town Member LLC
|
Triangle Town Center, Triangle Town Commons and Triangle Town Place
|
50.0
|
%
|
West Melbourne I, LLC
|
Hammock Landing Phases I and II
|
50.0
|
%
|
York Town Center, LP
|
York Town Center
|
50.0
|
%
|
Although the Company had majority ownership of certain joint ventures during
2012
,
2011
and
2010
, it evaluated the investments and concluded that the other partners or owners in these joint ventures had substantive participating rights, such as approvals of:
|
|
•
|
the pro forma for the development and construction of the project and any material deviations or modifications thereto;
|
|
|
•
|
the site plan and any material deviations or modifications thereto;
|
|
|
•
|
the conceptual design of the project and the initial plans and specifications for the project and any material deviations or modifications thereto;
|
|
|
•
|
any acquisition/construction loans or any permanent financings/refinancings;
|
|
|
•
|
the annual operating budgets and any material deviations or modifications thereto;
|
|
|
•
|
the initial leasing plan and leasing parameters and any material deviations or modifications thereto; and
|
|
|
•
|
any material acquisitions or dispositions with respect to the project.
|
As a result of the joint control over these joint ventures, the Company accounts for these investments using the equity method of accounting.
Condensed combined financial statement information of these unconsolidated affiliates is as follows:
|
|
|
|
|
|
|
|
|
|
December 31,
|
|
2012
|
|
2011
|
ASSETS:
|
|
|
|
Investment in real estate assets
|
$
|
2,143,187
|
|
|
$
|
2,239,160
|
|
Accumulated depreciation
|
(492,864
|
)
|
|
(447,121
|
)
|
|
1,650,323
|
|
|
1,792,039
|
|
Developments in progress
|
21,809
|
|
|
19,640
|
|
Net investment in real estate assets
|
1,672,132
|
|
|
1,811,679
|
|
Other assets
|
175,540
|
|
|
190,465
|
|
Total assets
|
$
|
1,847,672
|
|
|
$
|
2,002,144
|
|
|
|
|
|
LIABILITIES:
|
|
|
|
Mortgage and other indebtedness
|
1,456,622
|
|
|
1,478,601
|
|
Other liabilities
|
48,538
|
|
|
51,818
|
|
Total liabilities
|
1,505,160
|
|
|
1,530,419
|
|
OWNERS' EQUITY:
|
|
|
|
The Company
|
196,694
|
|
|
267,136
|
|
Other investors
|
145,818
|
|
|
204,589
|
|
Total owners' equity
|
342,512
|
|
|
471,725
|
|
Total liabilities and owners’ equity
|
1,847,672
|
|
|
2,002,144
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year Ended December 31,
|
|
2012
|
|
2011
|
|
2010
(1)
|
Revenues
|
$
|
251,628
|
|
|
$
|
177,222
|
|
|
$
|
154,078
|
|
Depreciation and amortization
|
(82,534
|
)
|
|
(58,538
|
)
|
|
(53,951
|
)
|
Other operating expenses
|
(76,567
|
)
|
|
(53,417
|
)
|
|
(48,723
|
)
|
Income from operations
|
92,527
|
|
|
65,267
|
|
|
51,404
|
|
Interest income
|
1,365
|
|
|
1,420
|
|
|
1,112
|
|
Interest expense
|
(84,421
|
)
|
|
(59,972
|
)
|
|
(55,161
|
)
|
Gain on sales of real estate assets
|
2,063
|
|
|
1,744
|
|
|
1,492
|
|
Income from discontinued operations
|
—
|
|
|
—
|
|
|
166
|
|
Net income (loss)
|
$
|
11,534
|
|
|
$
|
8,459
|
|
|
$
|
(987
|
)
|
(1) The results of operations of Plaza del Sol, which was sold in June 2010, have been reflected as discontinued operations.
2012 Financings
In December 2012, a subsidiary of CBL/T-C obtained a
10
-year
$190,000
non-recourse loan, secured by West County Center in Des Peres, MO, that bears a fixed interest rate of
3.4%
and matures in
December 2022
. Net proceeds of
$189,687
were used to retire the outstanding borrowings of
$142,235
under the previous loan and the excess proceeds were distributed 50/50 to the Company and its partner.
In the third quarter of 2012, Gulf Coast closed on a three-year
$7,000
loan with a bank, secured by the third phase expansion of Gulf Coast Town Center, a shopping center located in Ft. Myers, FL. Interest on the loan is at LIBOR plus a margin of
2.5%
. The Company has guaranteed
100%
of this loan. Proceeds from the loan were distributed to the Company in accordance with the terms of the joint venture agreement and the Company used these funds to reduce the balance on its credit facilities.
During the first quarter of 2012, YTC closed on a
$38,000
10-year
non-recourse loan, secured by York Town Center in York, PA, which bears interest at a fixed rate of
4.9%
and matures in
February 2022
. Proceeds from the new loan, plus cash on hand, were used to retire an existing loan of
$39,379
that was scheduled to mature in
March 2012
.
Also during the first quarter of 2012, Port Orange closed on the extension and modification of a construction loan secured by The Pavilion at Port Orange in Port Orange, FL, to extend the maturity date to
March 2014
, remove a
1%
LIBOR floor and reduce the capacity from
$98,883
to
$64,950
. Port Orange paid
$3,332
to reduce the outstanding balance on the loan to the new
capacity amount. There is a
one
-year extension option remaining on the loan, which is at the joint venture's election, for an outside maturity date of
March 2015
. Interest on the loan is at LIBOR plus a margin of
3.5%
. The Company has guaranteed
100%
of the construction loan.
All of the debt on the Properties owned by the unconsolidated affiliates listed above is non-recourse, except for West Melbourne, Port Orange, High Pointe Commons and Gulf Coast. See
Note 14
for a description of guarantees the Company has issued related to certain unconsolidated affiliates.
Imperial Valley Mall L.P, Imperial Valley Peripheral L.P., Imperial Valley Commons L.P.
In December 2012, the Company acquired the remaining
40.0%
interests in Imperial Valley Mall L.P. and Imperial Valley Peripheral L.P., which owns vacant land adjacent to Imperial Valley Mall in El Centro, CA, from its joint venture partner. The results of operations of Imperial Valley Mall L.P. and Imperial Valley Peripheral L.P. through the acquisition date are included in the table above using the equity method of accounting. From the date of acquisition, the results of operations of Imperial Valley Mall L.P. and Imperial Valley Peripheral L.P. are accounted for on a consolidated basis. The Company also acquired the joint venture partner's
40.0%
interest in Imperial Valley Commons L.P., a VIE that owns land adjacent to Imperial Valley Mall. Imperial Valley Commons L.P. was consolidated as a VIE as of
December 31, 2011
and continues to be accounted for on a consolidated basis as a wholly-owned entity as of
December 31, 2012
. See
Note 3
for further information.
El Paso Outlet Outparcels, LLC
In
April 2012
, the Company acquired a
50.0%
interest in a joint venture, El Paso Outlet Outparcels, LLC, simultaneously with the acquisition of a
75.0%
interest in The Outlet Shoppes at El Paso (see
Note 3
). The Company's investment was
$3,864
. The remaining
50.0%
interest is owned by affiliates of Horizon Group Properties. El Paso Outlet Outparcels, LLC owns land adjacent to The Outlet Shoppes at El Paso. The terms of the joint venture agreement provide that voting rights, capital contributions and distributions of cash flows will be on a pari passu basis in accordance with the ownership percentages.
CBL/T-C, LLC
In October 2011, the Company entered into a joint venture, CBL/T-C with TIAA-CREF. The Company contributed its interests in CoolSprings Galleria and West County Center, as well as a partial interest in Oak Park Mall, and TIAA-CREF contributed cash of
$222,242
. The contributed interests were encumbered by a total of
$359,334
in mortgage loans. CBL/T-C used a portion of the contributed cash to acquire Pearland Town Center and the remaining interest in Oak Park Mall from the Company for an aggregate purchase price, including transaction costs, of
$381,730
, consisting of
$207,410
in cash and the assumption of a mortgage loan of
$174,320
. The Company received
$5,526
of cash from CBL/T-C for reimbursement of pre-formation expenditures. The Company used
$204,210
of the proceeds, net of closing costs and expenses, received from these transactions to repay outstanding borrowings on its secured lines of credit.
The Company and TIAA-CREF each own a
50%
interest with respect to the CoolSprings Galleria, Oak Park Mall and West County Center Properties. The terms of the joint venture agreement provide that, with respect to these Properties, voting rights, capital contributions and distributions of cash flows will be on a pari passu basis in accordance with ownership percentages. The Company and TIAA-CREF own
88%
and
12%
interests, respectively, in Pearland Town Center. The terms of the joint venture agreement provide that all major decisions, as defined, pertaining to Pearland Town Center require the approval of holders of
90%
of the interests in Pearland Town Center and that capital contributions will be made on a pro rata basis in accordance with ownership percentages. The terms of the joint venture also provide that distributions of cash from Pearland Town Center will be made first to TIAA-CREF until it has received a preferred return equal to
8.0%
, second to the Company until it has received a preferred return equal to
8.0%
and then to the Company and TIAA-CREF pro rata according to ownership interests. Beginning on the second anniversary of CBL/T-C's formation, after TIAA-CREF receives its preferred return, TIAA-CREF will receive distributions until its aggregate unreturned contributions are reduced to
$6,000
, before any cash distributions are eligible to be made to the Company. Also beginning on the second anniversary of CBL/T-C's formation, after TIAA-CREF has received its preferred return and its unreturned contributions are reduced to
$6,000
, and after the Company receives its preferred return, all remaining cash distributions will be made to the Company until its aggregate unreturned contributions are reduced to
$44,000
. Once the Company's aggregate unreturned contributions are reduced to
$44,000
, all remaining distributions will be made to the Company and TIAA-CREF on a pro rata basis according to the ownership percentages.
The terms of the joint venture also provide that between the second and third anniversaries of CBL/T-C's formation, the Company may elect to purchase TIAA-CREF's interest in Pearland Town Center for a purchase price equal to the greater of (i) the fair value of TIAA-CREF's interest in Pearland Town Center as determined by an appraisal or (ii) TIAA-CREF's invested capital plus a preferred return equal to
8.0%
.
The Company has accounted for the formation of CBL/T-C as the sale of a partial interest in the combined CoolSprings Galleria, Oak Park Mall and West County Center Properties and recognized a gain on sale of real estate of
$54,327
in 2011, which included the impact of a reserve for future capital expenditures that the Company must fund related to parking decks at West County Center in the amount of
$26,439
. The Company recorded its investment in CBL/T-C under the equity method of accounting at
$116,397
, which represented its combined remaining
50%
cost basis in the CoolSprings Galleria, Oak Park Mall and West County Center Properties.
The Company determined that CBL/T-C's interest in Pearland Town Center represents a variable interest in such specified assets of a VIE and have accounted for the Pearland Town Center Property separately from the combined CoolSprings Galleria, Oak Park Mall and West County Center Properties discussed above. The Company determined that, because it has the option to acquire TIAA-CREF's interest in Pearland Town Center in the future, it did not qualify as a partial sale and therefore, has accounted for the
$18,264
contributed by TIAA-CREF attributable to Pearland Town Center as a financing. This amount is included in mortgage and other indebtedness in the accompanying consolidated balance sheets. Under the financing method, the Company continues to account for Pearland Town Center on a consolidated basis.
Parkway Place L.P.
In October 2010, the Company acquired the remaining
50%
interest in Parkway Place in Huntsville, AL, from its joint venture partner. The interest was acquired for total consideration of
$38,775
, which consisted of
$17,831
in a combination of cash paid by the Company and a distribution from the joint venture to the joint venture partner and the assumption of the joint venture partner’s share of the loan secured by Parkway Place with a principal balance of
$20,944
at the time of purchase. The Company recognized a gain on investment of
$888
upon acquisition related to the excess of the fair value of the Company’s existing investment over its carrying value at the time of purchase. The results of operations of Parkway Place through the purchase date are included in the table above. From the date of purchase, the results of operations of Parkway Place from the date of purchase are reflected on a consolidated basis.
Mall Shopping Center Company
In June 2010, the Company’s
50.6%
owned unconsolidated joint venture, Mall Shopping Center Company, sold Plaza del Sol in Del Rio, TX. The joint venture recognized a gain of
$1,244
from the sale, of which the Company’s share was
$75
, net of the excess of its basis over its underlying equity in the amount of
$554
. The results of operations of Mall Shopping Center Company have been reclassified to discontinued operations in the table above for the year ended December 31, 2010.
CBL Macapa
In September 2008, the Company entered into a condominium partnership agreement with several individual investors to acquire a
60%
interest in a new retail development in Macapa, Brazil. In December 2009, the Company entered into an agreement to sell its
60%
interest to
one
of the individual investors for a gross sales price of
$1,263
, less closing costs for a net sales price of
$1,201
. The sale closed in March 2010. Upon closing, the buyer paid
$200
and gave the Company
two
notes receivable totaling
$1,001
, both with an interest rate of
10%
, for the remaining balance of the purchase price. There was
no
gain or loss on this sale. On April 22, 2010, the buyer paid the first note of
$300
, due on April 23, 2010, plus applicable interest. Upon maturity of the second note of
$701
, due on June 8, 2010, the buyer requested additional time for payment. The Company and buyer agreed to revised terms regarding the second note of which the buyer pays monthly installments of
$45
from July 2010 to June 2011, with a final balloon installment of
$161
due in July 2011. Interest on the revised note is payable at maturity. In late 2011, the Company agreed that if buyer repaid the outstanding principal balance of the note, then the accrued and unpaid interest would be forgiven. As of
December 31, 2012
, the buyer had paid
$579
of the outstanding balance of
$657
. The Company had not recognized any of the accrued and unpaid interest as income due to the uncertainty that the amount would be collected.
Cost Method Investments
The Company owns a
6.2%
noncontrolling interest in subsidiaries of Jinsheng Group (“Jinsheng”), an established mall operating and real estate development company located in Nanjing, China. As of
December 31, 2012
, Jinsheng owns controlling interests in
eight
home furnishing shopping malls.
The Company also holds a secured convertible promissory note secured by
16,565,534
Series 2 Ordinary Shares of Jinsheng. The secured note is non-interest bearing and was amended by the Company and Jinsheng in July 2012 to extend to January 22, 2013 the Company's right to convert the outstanding amount of the secured note into
16,565,534
Series A-2 Preferred Shares of Jinsheng (which equates to a
2.275%
ownership interest). The amendment also provides that if Jinsheng should complete an initial public offering, the secured note will be converted into common shares of the public company immediately prior to the
initial public offering. In October 2012, the Company exercised its right to demand payment of the secured note, which has a face amount of
$4,875
. Subsequent to
December 31, 2012
, the Company and Jinsheng amended the note to extend the maturity date. See
Note 20
for additional information.
The Company accounts for its noncontrolling interest in Jinsheng using the cost method because the Company does not exercise significant influence over Jinsheng and there is no readily determinable market value of Jinsheng’s shares since they are not publicly traded. The Company initially recorded the secured note at its estimated fair value of
$4,513
, which reflects a discount of
$362
due to the fact that it is non-interest bearing. The discount was amortized to interest income over the term of the secured note using the effective interest method through March 2009, at which time the Company recorded an other-than-temporary impairment charge to reduce the secured note to its estimated fair value of
$2,475
due to a decline in expected cash flows. The decrease resulted from declining occupancy rates and sales due to the then downturn of the real estate market in China. See
Note 15
for information regarding the fair value of the secured note at
December 31, 2012
. The noncontrolling interest and the secured note are reflected as investment in unconsolidated affiliates in the accompanying consolidated balance sheets.
NOTE 6. MORTGAGE AND OTHER INDEBTEDNESS
Mortgage and other indebtedness consisted of the following:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31, 2012
|
|
December 31, 2011
|
|
Amount
|
|
Weighted
Average
Interest
Rate
(1)
|
|
Amount
|
|
Weighted
Average
Interest
Rate
(1)
|
Fixed-rate debt:
|
|
|
|
|
|
|
|
Non-recourse loans on operating properties
(2)
|
$
|
3,776,245
|
|
|
5.43
|
%
|
|
$
|
3,637,979
|
|
|
5.55
|
%
|
Recourse term loans on operating properties
|
—
|
|
|
—
|
%
|
|
77,112
|
|
|
5.89
|
%
|
Financing method obligation
(3)
|
18,264
|
|
|
|
|
18,264
|
|
|
|
Total fixed-rate debt
|
3,794,509
|
|
|
5.43
|
%
|
|
3,733,355
|
|
|
5.54
|
%
|
Variable-rate debt:
|
|
|
|
|
|
|
|
|
|
|
|
Non-recourse term loans on operating properties
|
123,875
|
|
|
3.36
|
%
|
|
168,750
|
|
|
3.03
|
%
|
Recourse term loans on operating properties
|
97,682
|
|
|
1.78
|
%
|
|
124,439
|
|
|
2.29
|
%
|
Construction loans
|
15,366
|
|
|
2.96
|
%
|
|
25,921
|
|
|
3.25
|
%
|
Unsecured lines of credit
(4)
|
475,626
|
|
|
2.07
|
%
|
|
—
|
|
|
—
|
%
|
Secured lines of credit
|
10,625
|
|
|
2.46
|
%
|
|
27,300
|
|
|
3.03
|
%
|
Unsecured term loans
|
228,000
|
|
|
1.82
|
%
|
|
409,590
|
|
|
1.67
|
%
|
Total variable-rate debt
|
951,174
|
|
|
2.20
|
%
|
|
756,000
|
|
|
2.18
|
%
|
Total
|
$
|
4,745,683
|
|
|
4.79
|
%
|
|
$
|
4,489,355
|
|
|
4.99
|
%
|
|
|
(1)
|
Weighted-average interest rate includes the effect of debt premiums (discounts), but excludes amortization of deferred financing costs.
|
|
|
(2)
|
The Company had
four
interest rate swaps on notional amounts totaling
$113,885
as of
December 31, 2012
and
$117,700
as of
December 31, 2011
related to its variable-rate loans on operating Properties to effectively fix the interest rates on the respective loans. Therefore, these amounts are reflected in fixed-rate debt at
December 31, 2012
and
2011
.
|
|
|
(3)
|
This amount represents the noncontrolling partner's equity contribution related to Pearland Town Center that is accounted for as a financing due to certain terms of the CBL/T-C joint venture agreement. See
Note 5
for further information.
|
|
|
(4)
|
The Company converted two of its credit facilities from secured facilities to unsecured facilities in November 2012.
|
Non-recourse and recourse term loans include loans that are secured by Properties owned by the Company that have a net carrying value of
$4,653,227
at
December 31, 2012
.
Unsecured Lines of Credit
In November 2012, the Company closed on the modification and extension of its
$525,000
and
$520,000
secured credit facilities. Under the terms of the agreements, of which Wells Fargo Bank NA serves as the administrative agent for the lender groups, the
two
secured credit facilities were converted to
two
unsecured credit facilities ("Facility A" and "Facility B") with an increase in capacity on each to
$600,000
for a total capacity of
$1,200,000
. The Company paid aggregate fees of approximately
$4,259
in connection with the extension and modification of the facilities. Facility A matures in
November 2015
and has a
one
-year extension option for an outside maturity date of
November 2016
. Facility B matures in
November 2016
and has a
one
-year extension option for an outside maturity date of
November 2017
. The extension options on both facilities are at the Company's election, subject to continued compliance with the terms of the facilities, and have a one-time extension fee of
0.20%
of the
commitment amount of each credit facility. Both unsecured facilities bear interest at an annual rate equal to one-month, three-month, or six-month LIBOR plus a range of
155
to
210
basis points based on the Company's leverage ratio. The Company also pays annual unused facility fees, on a quarterly basis, at rates of either
0.25%
or
0.35%
based on any unused commitment of each facility. In the event the Company obtains an investment grade rating by either Standard & Poor's or Moody's, the Company may make a one-time irrevocable election to use its credit rating to determine the interest rate on each facility. If the Company were to make such an election, the interest rate on each facility would bear interest at an annual rate equal to one-month, three-month, or six-month LIBOR plus a spread of
100
to
175
basis points. Once the Company elects to use its credit rating to determine the interest rate on each facility, it will begin to pay an annual facility fee that ranges from
0.15%
to
0.35%
of the total capacity of each facility rather than the annual unused commitment fees as described above. The Company uses its lines of credit for mortgage retirement, working capital, construction and acquisition purposes, as well as issuances of letters of credit. The
two
unsecured lines of credit had a weighted average interest rate of
2.07%
at
December 31, 2012
. The following summarizes certain information about the unsecured lines of credit as of
December 31, 2012
:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
Capacity
|
|
Total
Outstanding
|
|
Maturity
Date
|
|
Extended
Maturity
Date
|
Facility A
|
600,000
|
|
|
300,297
|
|
(1)
|
November 2015
|
|
November 2016
|
Facility B
|
600,000
|
|
|
175,329
|
|
|
November 2016
|
|
November 2017
|
|
$
|
1,200,000
|
|
|
$
|
475,626
|
|
|
|
|
|
|
|
(1)
|
There was an additional
$601
outstanding on this facility as of
December 31, 2012
for letters of credit. Up to
$50,000
of the capacity on this facility can be used for letters of credit.
|
Secured Line of Credit
In June 2012, the Company closed on the extension and modification of its
$105,000
secured credit facility. The facility's maturity date was extended to
June 2015
and has a one-year extension option, which is at the Company's election and subject to continued compliance with the terms of the facility, for an outside maturity date of
June 2016
. The facility bears interest at an annual rate equal to one-month LIBOR plus a margin of
175
to
275
basis points based on the Company's leverage ratio. The line is secured by mortgages on certain of the Company’s operating Properties and is used for mortgage retirement, working capital, construction and acquisition purposes. The secured line of credit had a weighted average interest rate of
2.46%
at
December 31, 2012
. The Company also pays a non-usage fee based on the amount of unused availability under its secured line of credit at
0.15%
of unused availability. The
$105,000
secured credit facility had
$10,625
outstanding at
December 31, 2012
.
The secured line of credit is collateralized by
six
of the Company’s Properties, or certain parcels thereof, which had an aggregate net carrying value of
$130,786
at
December 31, 2012
.
See
Note 20
for subsequent event related to the secured line of credit.
Unsecured Term Loans
The Company has an unsecured term loan of
$228,000
that bears interest at LIBOR plus a margin of
1.50%
to
1.80%
based on the Company’s leverage ratio, as defined in the loan agreement. At
December 31, 2012
, the outstanding borrowings of
$228,000
under the unsecured term loan had a weighted average interest rate of
1.82%
. In 2012, the Company exercised its one-year extension option to extend the maturity date from April 2012 to April 2013. The Company intends to retire this loan at the maturity date.
The Company had an unsecured term loan that bore interest at LIBOR plus a margin ranging from
0.95%
to
1.40%
, based on the Company's leverage ratio. The loan was obtained in February 2008 for the exclusive purpose of acquiring certain Properties from the Starmount Company or its affiliates. The Company retired the
$127,209
unsecured term loan at its maturity in November 2012 with borrowings from its credit facilities.
Letters of Credit
At
December 31, 2012
, the Company had additional secured and unsecured lines of credit with a total commitment of
$14,000
that can only be used for issuing letters of credit. The letters of credit outstanding under these lines of credit totaled
$1,475
at
December 31, 2012
.
Fixed-Rate Debt
As of
December 31, 2012
, fixed-rate loans on operating Properties bear interest at stated rates ranging from
4.54%
to
8.50%
. Outstanding borrowings under fixed-rate loans include net unamortized debt premiums of
$12,830
that were recorded when the Company assumed debt to acquire real estate assets that was at a net above-market interest rate compared to similar debt instruments at the date of acquisition. Fixed-rate loans generally provide for monthly payments of principal and/or interest and mature at various dates through July 2022, with a weighted average maturity of
4.90
years.
2012 Activity
In the fourth quarter of 2012, the Company retired a non-recourse loan with a principal balance of
$106,895
, secured by Monroeville Mall in Monroeville, PA, with borrowings from the Company's credit facilities. The loan was scheduled to mature in
January 2013
.
During the third quarter of 2012, the Company retired a
$44,480
loan, which was secured by a regional mall, with borrowings from the Company's credit facilities. The loan was scheduled to mature in 2012. The Company recorded a gain on extinguishment of debt of
$178
related to the early retirement of this debt.
During the second quarter of 2012, the Company closed on five 10-year non-recourse CMBS loans totaling
$342,190
. The loans bear interest at fixed rates ranging from
4.750%
to
5.099%
with a total weighted average interest rate of
4.946%
. These loans are secured by WestGate Mall in Spartanburg, SC; Southpark Mall in Colonial Heights, VA; Jefferson Mall in Louisville, KY; Fashion Square Mall in Saginaw, MI and Arbor Place in Douglasville, GA. Proceeds were used to pay down the Company's credit facilities and to retire an existing loan with a balance of
$30,763
secured by Southpark Mall.
Additionally, during the second quarter of 2012, the Company closed on a
$22,000
10
-year non-recourse loan with an insurance company at a fixed interest rate of
5.00%
secured by CBL Centers I and II in Chattanooga, TN. The new loan was used to pay down the Company's credit facilities, which had been used in April 2012 and February 2012 to retire the balances on the maturing loans on CBL Centers II and I which had principal outstanding balances of
$9,078
and
$12,818
, respectively.
During the first quarter of 2012, the Company closed on a
$73,000
10
-year non-recourse CMBS loan secured by Northwoods Mall in Charleston, SC, which bears a fixed interest rate of
5.075%
. Proceeds were used to reduce outstanding balances on the Company's credit facilities.
Also during the first quarter of 2012, the Company retired
14
operating property loans with an aggregate principal balance of
$381,568
that were secured by Arbor Place, The Landing at Arbor Place, Fashion Square, Hickory Hollow Mall, The Courtyard at Hickory Hollow, Jefferson Mall, Massard Crossing, Northwoods Mall, Old Hickory Mall, Pemberton Plaza, Randolph Mall, Regency Mall, WestGate Mall and Willowbrook Plaza with borrowings from its secured credit facilities. See
Note 4
related to the sale of Massard Crossing, Hickory Hollow Mall and Willowbrook Plaza in 2012.
In the first quarter of 2012, the lender of the non-recourse mortgage loan secured by Columbia Place in Columbia, SC notified the Company that the loan had been placed in default. Columbia Place generates insufficient income levels to cover the debt service on the mortgage, which had a balance of
$27,265
at
December 31, 2012
, and a contractual maturity date of September 2013. The lender on the loan receives the net operating cash flows of the property each month in lieu of scheduled monthly mortgage payments.
See
Note 20
for operating property loan retired subsequent to
December 31, 2012
.
2011 Activity
During the fourth quarter of 2011, the Company closed on a
$140,000
ten
-year non-recourse mortgage loan secured by Cross Creek Mall in Fayetteville, NC, which bears a fixed interest rate of
4.54%
. The Company also closed on a
$60,000
ten
-year non-recourse CMBS loan with a fixed interest rate of
5.73%
secured by The Outlet Shoppes at Oklahoma City in Oklahoma City, OK. Proceeds were used to retire existing loans with a principal balance of
$56,823
and
$39,274
, respectively, and to pay down the Company's secured credit facilities.
During the third quarter of 2011, the Company closed on
two
ten
-year, non-recourse mortgage loans totaling
$128,800
, including a
$50,800
loan secured by Alamance Crossing in Burlington, NC and a
$78,000
loan secured by Asheville Mall in Asheville, NC. The loans bear interest at fixed rates of
5.83%
and
5.80%
, respectively. Proceeds were used to repay existing loans with principal balances of
$51,847
and
$61,346
, respectively, and to pay down the Company's secured credit facilities.
During the second quarter of 2011, the Company closed on
two
separate
ten
-year, non-recourse mortgage loans totaling
$277,000
, including a
$185,000
loan secured by Fayette Mall in Lexington, KY and a
$92,000
loan secured by Mid Rivers Mall
in St. Charles, MO. The loans bear interest at fixed rates of
5.42%
and
5.88%
, respectively. Proceeds were used to repay existing loans with principal balances of
$84,733
and
$74,748
, respectively, and to pay down the Company’s secured credit facilities. In addition, the Company retired a loan with a principal balance of
$36,317
that was secured by Panama City Mall in Panama City, FL with borrowings from its secured credit facilities.
During the first quarter of 2011, the Company closed on
five
separate non-recourse mortgage loans totaling
$268,905
. These loans have
ten
-year terms and include a
$95,000
loan secured by Parkdale Mall and Parkdale Crossing in Beaumont, TX; a
$99,400
loan secured by Park Plaza in Little Rock, AR; a
$44,100
loan secured by EastGate Mall in Cincinnati, OH; a
$19,800
loan secured by Wausau Center in Wausau, WI; and a
$10,605
loan secured by Hamilton Crossing in Chattanooga, TN. The loans bear interest at a weighted average fixed rate of
5.64%
and are not cross-collateralized. Proceeds were used to pay down the Company's secured credit facilities.
Variable-Rate Debt
Recourse term loans for the Company’s operating Properties bear interest at variable interest rates indexed to the LIBOR rate. At
December 31, 2012
, interest rates on such recourse loans varied from
1.21%
to
3.36%
. These loans mature at various dates from February 2013 to December 2016, with a weighted average maturity of
2.87
years, and several have extension options of up to one year.
2012 Activity
During the third quarter of 2012, the Company retired a
$77,500
loan, secured by RiverGate Mall in Nashville, TN, with borrowings from the Company's secured credit facilities. The loan was scheduled to mature in
September 2012
.
During the second quarter of 2012, the Company entered into a
75%
/
25%
joint venture, Atlanta Outlet Shoppes, LLC, with a third party to develop, own and operate The Outlet Shoppes at Atlanta, an outlet center development located in Woodstock, GA. In August 2012, the joint venture closed on a construction loan with a maximum capacity of
$69,823
that bears interest at LIBOR plus a margin of
275
basis points. The loan matures in
August 2015
and has two one-year extensions available, which are at our option. The Company has guaranteed
100%
of this loan.
Also during the second quarter of 2012, the Company closed on the extension and modification of a recourse loan secured by Statesboro Crossing in Statesboro, GA to extend the maturity date to February 2013 and reduce the amount available under the loan from
$20,911
to equal the outstanding balance of
$13,568
. The interest rate remained at one-month LIBOR plus a spread of
1.00%
. This loan was retired subsequent to
December 31, 2012
. See
Note 20
for further information.
2011 Activity
During the fourth quarter of 2011, the borrowing amount on a non-recourse loan secured by St. Clair Square in Fairview Heights, IL was increased from
$69,375
to
$125,000
and extended for a
five
-year period from December 2011 to December 2016, with a reduction in the interest rate to LIBOR plus
300
basis points. Additionally, the Company closed a
$58,000
recourse mortgage loan secured by The Promenade in D'lberville, MS with a three-year initial term and two two-year extensions. The loan bears interest of
75%
of LIBOR plus
175
basis points. The Company also closed on the extension of a
$3,300
loan secured by Phase II of Hammock Landing in West Melbourne, FL. The loan's maturity date was extended to November 2013 at its existing interest rate of LIBOR plus a margin of
2.00%
.
During the first quarter of 2011, the Company closed on four separate loans totaling
$120,165
. These loans have
five
-year terms and include a
$36,365
loan secured by Stroud Mall in Stroud, PA; a
$58,100
loan secured by York Galleria in York, PA; a
$12,100
loan secured by Gunbarrel Pointe in Chattanooga, TN; and a
$13,600
loan secured by CoolSprings Crossing in Nashville, TN. These four loans have partial-recourse features totaling
$7,540
at December 31, 2011, which decreases as the aggregate principal amount outstanding on the loans is amortized. The loans bear interest at LIBOR plus a margin of
2.40%
and are not cross-collateralized. Proceeds were used to pay down the Company's secured credit facilities. The Company has interest rate swaps in place for the full term of each five-year loan to effectively fix the interest rates. As a result, these loans bear interest at a weighted average fixed rate of
4.57%
. See Interest Rate Hedge Instruments below for additional information.
Construction Loan
In the third quarter of 2012, the Company retired a
$2,023
land loan, secured by The Forum at Grandview in Madison, MS, with borrowings from the Company's secured credit facilities. The loan was scheduled to mature in
September 2012
.
Covenants and Restrictions
The agreements to the unsecured and secured lines of credit contain, among other restrictions, certain financial covenants including the maintenance of certain financial coverage ratios, minimum net worth requirements, minimum unencumbered asset and interest ratios, maximum secured indebtedness ratios and limitations on cash flow distributions. The Company believes that it was in compliance with all covenants and restrictions at
December 31, 2012
.
The following presents the Company's compliance with key unsecured debt covenant compliance ratios as of
December 31, 2012
:
|
|
|
|
Ratio
|
Required
|
Actual
|
Debt to total asset value
|
< 60%
|
52.6%
|
Ratio of unencumbered asset value to unsecured indebtedness
|
> 1.60x
|
3.13x
|
Ratio of unencumbered NOI to unsecured interest expense
|
> 1.75x
|
11.41x
|
Ratio of EBITDA to fixed charges (debt service)
|
> 1.50x
|
2.00x
|
The agreements to the two
$600,000
unsecured credit facilities described above, each with the same lead lender, contain default provisions customary for transactions of this nature (with applicable customary grace periods). Additionally, any default in the payment of any recourse indebtedness greater than or equal to
$50,000
or any non-recourse indebtedness greater than
$150,000
(for the Company's ownership share) of the Company, the Operating Partnership or any Subsidiary, as defined, will constitute an event of default under the agreements to the credit facilities. The credit facilities also restrict the Company's ability to enter into any transaction that could result in certain changes in its ownership or structure as described under the heading “Change of Control/Change in Management” in the agreements to the credit facilities. The obligations of the Company under the agreement also will be unconditionally guaranteed, jointly and severally, by any subsidiary of the Company to the extent such subsidiary becomes a material subsidiary and is not otherwise an excluded subsidiary, as defined in the agreement.
The agreement to the
$228,000
unsecured term loan described above, with the same lead lender as the unsecured credit facilities, contains default and cross-default provisions customary for transactions of this nature (with applicable customary grace periods) in the event (i) there is a default in the payment of any indebtedness owed by the Company to any institution which is a part of the lender group for the unsecured term loan, or (ii) there is any other type of default with respect to any indebtedness owed by the Company to any institution which is a part of the lender group for the unsecured term loan and such lender accelerates the payment of the indebtedness owed to it as a result of such default. The unsecured term loan agreement provides that, upon the occurrence and continuation of an event of default, payment of all amounts outstanding under the unsecured term loan and those facilities with which the agreement references cross-default provisions may be accelerated and the lenders' commitments may be terminated. Additionally, any default in the payment of any recourse indebtedness greater than 1% of gross asset value or default in the payment of any non-recourse indebtedness greater than 3% of gross asset value of the Company, the Operating Partnership and Significant Subsidiaries, as defined, regardless of whether the lending institution is a part of the lender group for the unsecured term loan, will constitute an event of default under the agreement to the unsecured term loan.
Several of the Company’s malls/open-air centers, associated centers and community centers, in addition to the corporate office building are owned by special purpose entities that are included in the Company’s consolidated financial statements. The sole business purpose of the special purpose entities is to own and operate these Properties. The real estate and other assets owned by these special purpose entities are restricted under the loan agreements in that they are not available to settle other debts of the Company. However, so long as the loans are not under an event of default, as defined in the loan agreements, the cash flows from these Properties, after payments of debt service, operating expenses and reserves, are available for distribution to the Company.
Scheduled Principal Payments
As of
December 31, 2012
, the scheduled principal amortization and balloon payments of the Company’s consolidated debt, excluding extensions available at the Company’s option, on all mortgage and other indebtedness, including construction loans and lines of credit, are as follows:
|
|
|
|
|
2013
|
$
|
503,171
|
|
2014
|
714,874
|
|
2015
|
559,012
|
|
2016
|
779,514
|
|
2017
|
552,682
|
|
Thereafter
|
1,623,600
|
|
|
4,732,853
|
|
Net unamortized premiums
|
12,830
|
|
|
$
|
4,745,683
|
|
Of the
$503,171
of scheduled principal payments in 2013,
$202,812
relates to the maturing principal balances of
six
operating Property loans,
$228,000
relates to
one
unsecured term loan and
$72,359
represents scheduled principal amortization.
Two
maturing operating Property loans with principal balances totaling
$26,200
outstanding as of
December 31, 2012
have extensions available at the Company’s option, leaving approximately
$404,612
of loan maturities in 2013 that the Company intends to retire or refinance. Subsequent to
December 31, 2012
, the Company retired
two
operating Property loans with an aggregate balance of
$77,121
as of
December 31, 2012
.
The Company has extension options available, at its election and subject to continued compliance with the terms of the facilities, related to the maturities of its unsecured and secured credit facilities. The credit facilities may be used to retire loans maturing in 2013 as well as to provide additional flexibility for liquidity purposes.
Interest Rate Hedging Instruments
The Company records its derivative instruments in its consolidated balance sheets at fair value. The accounting for changes in the fair value of derivatives depends on the intended use of the derivative, whether the derivative has been designated as a hedge and, if so, whether the hedge has met the criteria necessary to apply hedge accounting.
The Company’s objectives in using interest rate derivatives are to add stability to interest expense and to manage its exposure to interest rate movements. To accomplish these objectives, the Company primarily uses interest rate swaps and caps as part of its interest rate risk management strategy. Interest rate swaps designated as cash flow hedges involve the receipt of variable-rate amounts from a counterparty in exchange for the Company making fixed-rate payments over the life of the agreements without exchange of the underlying notional amount. Interest rate caps designated as cash flow hedges involve the receipt of variable-rate amounts from a counterparty if interest rates rise above the strike rate on the contract in exchange for an up-front premium.
The effective portion of changes in the fair value of derivatives designated as, and that qualify as, cash flow hedges is recorded in accumulated other comprehensive income (loss) (“AOCI/L”) and is subsequently reclassified into earnings in the period that the hedged forecasted transaction affects earnings. Such derivatives were used to hedge the variable cash flows associated with variable-rate debt.
In the first quarter of 2012, the Company entered into a
$125,000
interest rate cap agreement (amortizing to
$122,375
) to hedge the risk of changes in cash flows on the borrowings of one of its properties equal to the cap notional. The interest rate cap protects the Company from increases in the hedged cash flows attributable to overall changes in 3-month LIBOR above the strike rate of the cap on the debt. The strike rate associated with the interest rate cap is
5.0%
. The cap matures in
January 2014
.
As of
December 31, 2012
, the Company had the following outstanding interest rate derivatives that were designated as cash flow hedges of interest rate risk:
|
|
|
|
|
|
|
|
|
Interest Rate
Derivative
|
|
Number of
Instruments
|
|
Notional
Amount
|
Interest Rate Cap
|
|
1
|
|
|
$
|
123,875
|
|
Interest Rate Swaps
|
|
4
|
|
|
$
|
113,885
|
|
The following tables provide further information relating to the Company’s interest rate derivatives that were designated as cash flow hedges of interest rate risk as of
December 31, 2012
and
2011
:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Instrument Type
|
|
Location in
Consolidated
Balance Sheet
|
|
Notional
Amount
|
|
Designated
Benchmark
Interest
Rate
|
|
Strike
Rate
|
|
Fair Value at 12/31/12
|
|
Fair Value at 12/31/11
|
|
Maturity
Date
|
Cap
|
|
Intangible lease assets
and other assets
|
|
$ 123,875
(amortizing
to $122,375)
|
|
3-month
LIBOR
|
|
5.000
|
%
|
|
$
|
—
|
|
|
$
|
—
|
|
|
Jan 2014
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Pay fixed/ Receive
variable Swap
|
|
Accounts payable and
accrued liabilities
|
|
$ 55,057
(amortizing
to $48,337)
|
|
1-month
LIBOR
|
|
2.149
|
%
|
|
$
|
(2,775
|
)
|
|
$
|
(2,674
|
)
|
|
Apr 2016
|
Pay fixed/ Receive
variable Swap
|
|
Accounts payable and
accrued liabilities
|
|
$ 34,469
(amortizing
to $30,276)
|
|
1-month
LIBOR
|
|
2.187
|
%
|
|
(1,776
|
)
|
|
(1,725
|
)
|
|
Apr 2016
|
Pay fixed/ Receive
variable Swap
|
|
Accounts payable and
accrued liabilities
|
|
$ 12,887
(amortizing
to $11,313)
|
|
1-month
LIBOR
|
|
2.142
|
%
|
|
(647
|
)
|
|
(622
|
)
|
|
Apr 2016
|
Pay fixed/ Receive
variable Swap
|
|
Accounts payable and
accrued liabilities
|
|
$ 11,472
(amortizing
to $10,083)
|
|
1-month
LIBOR
|
|
2.236
|
%
|
|
(607
|
)
|
|
(596
|
)
|
|
Apr 2016
|
|
|
|
|
|
|
|
|
|
|
$
|
(5,805
|
)
|
|
$
|
(5,617
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Hedging
Instrument
|
|
Gain (Loss) Recognized in OCI/L
(Effective Portion)
|
|
Location of Losses Reclassified from AOCI/L into Earnings (Effective Portion)
|
|
Loss Recognized in Earnings
(Effective Portion)
|
|
Location of Gain (Loss) Recognized in Earnings (Ineffective Portion)
|
|
Gain
Recognized in
Earnings
(Ineffective Portion)
|
|
2012
|
2011
|
2010
|
|
|
2012
|
2011
|
2010
|
|
|
2012
|
2011
|
2010
|
Interest rate contracts
|
|
$
|
(207
|
)
|
$
|
(5,521
|
)
|
$
|
2,742
|
|
|
Interest Expense
|
|
$
|
(2,267
|
)
|
$
|
(1,904
|
)
|
$
|
(2,883
|
)
|
|
Interest Expense
|
|
$
|
—
|
|
$
|
—
|
|
$
|
23
|
|
As of
December 31, 2012
, the Company expects to reclassify approximately
$2,219
of losses currently reported in accumulated other comprehensive income to interest expense within the next twelve months due to the amortization of its outstanding interest rate contracts. Fluctuations in fair values of these derivatives between
December 31, 2012
and the respective dates of termination will vary the projected reclassification amount.
See
Notes 2
and
15
for additional information regarding the Company’s interest rate hedging instruments.
NOTE 7. SHAREHOLDERS’ EQUITY
Common Stock
The Company's authorized common stock consists of
350,000,000
shares at
$0.01
par value per share. The Company had
161,309,652
and
148,364,037
share of common stock issued and outstanding as of
December 31, 2012
and
2011
, respectively.
Preferred Stock
The Company's authorized preferred stock consists of
15,000,000
shares at
$0.01
par value per share. A description of the Company's cumulative redeemable preferred stock is listed below.
In October 2012, the Company completed an underwritten public offering of
6,900,000
depositary shares, each representing 1/10
th
of a share of its newly designated Series E Preferred Stock at
$25.00
per depositary share. The Company received net proceeds from the offering of approximately
$166,636
after deducting the underwriting discount and offering expenses. A portion of the net proceeds from this offering were used to redeem all the Company's outstanding Series C Shares with an aggregate liquidation preference of
$115,000
and
$891
related to accrued and unpaid dividends for an aggregate redemption amount of
$115,891
. The remaining net proceeds of
$50,745
were used to reduce outstanding balances on the Company's credit facilities. The Company will pay cumulative dividends on the Series E Preferred Stock from the date of original issuance in the amount of
$1.65625
per depositary share each year, which is equivalent to
6.625%
of the
$25.00
liquidation preference per depositary share. The Company may not redeem the Series E Preferred Stock before October 12, 2017, except in limited circumstances to preserve the Company's REIT status or in connection with a change of control. On or after October 12, 2017,
the Company may, at its option, redeem the Series E Preferred Stock in whole at any time or in part from time to time by paying
$25.00
per depositary share, plus any accrued and unpaid dividends up to, but not including, the date of redemption. The Series E Preferred Stock generally has no stated maturity and will not be subject to any sinking fund or mandatory redemption. The Series E Preferred Stock is not convertible into any of the Company's securities, except under certain circumstances in connection with a change of control. Owners of the depositary shares representing Series E Preferred Stock generally have no voting rights except under dividend default.
The Company had
18,150,000
depositary shares, each representing 1/10
th
of a share of the Company's
7.375%
Series D Preferred Stock with a par value of
$0.01
per share, outstanding as of
December 31, 2012
and
2011
. The Series D Preferred Stock has a liquidation preference of
$250.00
per share (
$25.00
per depositary share). The dividends on the Series D Preferred Stock are cumulative, accrue from the date of issuance and are payable quarterly in arrears at a rate of
$18.4375
per share (
$1.84375
per depositary share) per annum. The Series D Preferred Stock has no stated maturity, is not subject to any sinking fund or mandatory redemption, and is not convertible into any other securities of the Company. The Company may redeem shares, in whole or in part, at any time for a cash redemption price of
$250.00
per share (
$25.00
per depositary share) plus accrued and unpaid dividends.
On November 5, 2012, the Company redeemed all
460,000
Series C Shares and all outstanding depositary shares, each representing 1/10
th
of a Series C Share for
$115,891
. The Company recorded a charge to preferred dividends of
$3,773
upon redemption to write off direct issuance costs related to the Series C Shares and underlying depositary shares.
Dividends
The Company paid first, second and third quarter
2012
cash dividends on its common stock of
$0.22
per share on April 17
th
, July 17
th
and October 16
th
2012
, respectively. On November 28, 2012, the Company's Board of Directors declared a fourth quarter cash dividend of
$0.22
per share that was paid on January 16, 2013, to shareholders of record as of December 28, 2012. The dividend declared in the fourth quarter of
2012
, totaling
$35,485
, is included in accounts payable and accrued liabilities at
December 31, 2012
. The total dividend included in accounts payable and accrued liabilities at
December 31, 2011
was
$31,156
.
The allocations of dividends declared and paid for income tax purposes are as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year Ended December 31,
|
|
2012
|
|
2011
|
|
2010
|
Dividends declared:
|
|
|
|
|
|
Common stock
|
$
|
0.83
|
|
(1)
|
$
|
0.84
|
|
|
$
|
0.80
|
|
Series C preferred stock
|
$
|
14.53
|
|
(2)
|
$
|
19.38
|
|
|
$
|
19.38
|
|
Series D preferred stock
|
$
|
18.44
|
|
|
$
|
18.44
|
|
|
$
|
18.44
|
|
Series E preferred stock
|
$
|
3.91
|
|
(3)
|
$
|
—
|
|
|
$
|
—
|
|
|
|
|
|
|
|
Allocations:
|
|
|
|
|
|
|
|
|
Common stock
|
|
|
|
|
|
|
|
|
Ordinary income
|
100.00
|
%
|
|
100.00
|
%
|
|
100.00
|
%
|
Capital gains 25% rate
|
—
|
%
|
|
—
|
%
|
|
—
|
%
|
Return of capital
|
—
|
%
|
|
—
|
%
|
|
—
|
%
|
Total
|
100.00
|
%
|
|
100.00
|
%
|
|
100.00
|
%
|
|
|
|
|
|
|
Preferred stock
(4)
|
|
|
|
|
|
|
|
|
Ordinary income
|
100.00
|
%
|
|
100.00
|
%
|
|
100.00
|
%
|
Capital gains 25% rate
|
—
|
%
|
|
—
|
%
|
|
—
|
%
|
Total
|
100.00
|
%
|
|
100.00
|
%
|
|
100.00
|
%
|
|
|
(1)
|
Of the
$0.22
per share dividend declared on
November 18, 2012
and paid
January 16, 2013
,
$0.17
per share is taxable in
2012
and
$0.05
per share will be reported and is taxable in 2013.
|
|
|
(2)
|
Represents the three regular quarterly dividends paid in 2012, prior to the redemption on November 5, 2012.
|
|
|
(3)
|
Represents dividends for the partial quarter covering October 5, 2012 through December 31, 2012.
|
|
|
(4)
|
The allocations for income tax purposes are the same for each series of preferred stock for each period presented.
|
NOTE 8. REDEEMABLE NONCONTROLLING INTERESTS AND NONCONTROLLING INTERESTS
Redeemable Noncontrolling Interest and Noncontrolling Interests in the Operating Partnership
The redeemable noncontrolling interest and noncontrolling interests in the Operating Partnership are represented by common units and special common units of limited partnership interest in the Operating Partnership (the “Operating Partnership Units”) that the Company does not own.
Noncontrolling interests include the aggregate noncontrolling partnership interest in the Operating Partnership that is not owned by the Company and for which each of the noncontrolling limited partners has the right to exchange all or a portion of its partnership interests for shares of the Company’s common stock, or at the Company’s election, their cash equivalent. When an exchange occurs, CBL assumes the noncontrolling limited partner’s ownership interests in the Operating Partnership. The number of shares of common stock received by a noncontrolling limited partner of the Operating Partnership upon exercise of its exchange rights will be equal, on a one-for-one basis, to the number of Operating Partnership Units exchanged by the noncontrolling limited partner. The amount of cash received by the noncontrolling limited partner, if CBL elects to pay cash, will be based on the
five
-day trailing average of the trading price at the time of exercise of the shares of common stock that would otherwise have been received by the noncontrolling limited partner in the exchange. Neither the noncontrolling limited partnership interests in the Operating Partnership nor the shares of common stock of the Company are subject to any right of mandatory redemption.
Series S Special Common Units
Redeemable noncontrolling interest includes a noncontrolling partnership interest in the Operating Partnership for which the partnership agreement includes redemption provisions that may require the Company to redeem the partnership interest for real property. In July 2004, the Company issued
1,560,940
Series S special common units (“S-SCUs”), all of which are outstanding as of
December 31, 2012
, in connection with the acquisition of Monroeville Mall. Under the terms of the Operating Partnership’s limited partnership agreement, the holder of the S-SCUs has the right to exchange all or a portion of its partnership interest for shares of the Company’s common stock or, at the Company’s election, their cash equivalent. The holder has the additional right to, at any time after the seventh anniversary of the issuance of the S-SCUs, require the Operating Partnership to acquire a qualifying property and distribute it to the holder in exchange for the S-SCUs. Generally, the acquisition price of the qualifying property cannot be more than the lesser of the consideration that would be received in a normal exchange, as discussed above, or
$20,000
, subject to certain limited exceptions. Should the consideration that would be received in a normal exchange exceed the maximum property acquisition price as described in the preceding sentence, the excess portion of its partnership interest could be exchanged for shares of the Company’s stock or, at the Company’s election, their cash equivalent. The S-SCUs received a minimum distribution of
$2.53825
per unit per year for the first
five
years, and receive a minimum distribution of
$2.92875
per unit per year thereafter.
Series L Special Common Units
In June 2005, the Company issued
571,700
L-SCUs, all of which are outstanding as of
December 31, 2012
, in connection with the acquisition of Laurel Park Place. The L-SCUs receive a minimum distribution of
$0.7572
per unit per quarter (
$3.0288
per unit per year). Upon the earlier to occur of June 1, 2020, or when the distribution on the common units exceeds
$0.7572
per unit for
four
consecutive calendar quarters, the L-SCUs will thereafter receive a distribution equal to the amount paid on the common units. In December 2012, the Company issued
622,278
common units valued at
$14,000
to acquire the remaining
30%
noncontrolling interest in Laurel Park Place. The
$14,000
value of the noncontrolling interest was recorded as a deferred purchase liability in Accounts Payable and Accrued Liabilities on the consolidated balance sheet upon the original acquisition of Laurel Park Place in 2005.
Series K Special Common Units
In November 2005, the Company issued
1,144,924
K-SCUs, all of which are outstanding as of
December 31, 2012
, in connection with the acquisition of Oak Park Mall, Eastland Mall and Hickory Point Mall. The K-SCUs received a dividend at a rate of
6.0%
, or
$2.85
per K-SCU, for the first year following the close of the transaction and receive a dividend at a rate of
6.25%
, or
$2.96875
per K-SCU, thereafter. When the quarterly distribution on the Operating Partnership’s common units exceeds the quarterly K-SCU distribution for
four
consecutive quarters, the K-SCUs will receive distributions at the rate equal to that paid on the Operating Partnership’s common units. At any time following the first anniversary of the closing date, the holders of the K-SCUs may exchange them, on a
one
-for-
one
basis, for shares of the Company’s common stock or, at the Company’s election, their cash equivalent.
Series J Special Common Units
During 2011, a holder of
125,100
J-SCU's exercised its conversion rights. The Company was requested to exchange common stock for these units, and elected to do so. Additionally during 2011, the Company converted
15,435,754
J-SCUs, which represented all of the outstanding J-SCUs, to common units pursuant to its rights to do so. Prior to the conversion the J-SCUs received a minimum distribution equal to
$0.3628125
per unit per quarter (
$1.45125
per unit per year), subject to certain adjustments if the distribution on the common units was equal to or less than
$0.21875
for
four
consecutive quarters. After March 31, 2011, the common units issued in the conversion receive a distribution equal to that paid on all other common units.
Common Units of Limited Partnership Interest in the Operating Partnership
During 2012, holders of
12,690,628
common units of limited partnership interest in the Operating Partnership exercised their conversion rights. The Company elected to pay cash of
$3,965
for
224,628
common units and to issue
12,466,000
shares of common stock in exchange for the remaining common units.
During the fourth quarter of 2011, holders of
401,324
common units of limited partnership interest in the Operating Partnership exercised their conversion rights. The Company elected to pay cash of
$5,869
for these units in the first quarter of 2012.
During 2010, holders of
9,807,013
J-SCUs exercised their conversion rights. The Company was requested to exchange common stock for these units, and elected to do so.
Outstanding rights to convert redeemable noncontrolling interests and noncontrolling interests in the Operating Partnership to common stock were held by the following parties at
December 31, 2012
and
2011
:
|
|
|
|
|
|
|
|
December 31,
|
|
2012
|
|
2011
|
Jacobs
|
—
|
|
|
13,044,407
|
|
CBL’s Predecessor
|
18,172,690
|
|
|
18,604,156
|
|
Third parties
|
11,372,897
|
|
|
10,368,016
|
|
Total Operating Partnership Units
|
29,545,587
|
|
|
42,016,579
|
|
The assets and liabilities allocated to the Operating Partnership’s redeemable noncontrolling interest and noncontrolling interests are based on their ownership percentages of the Operating Partnership at
December 31, 2012
and
2011
. The ownership percentages are determined by dividing the number of Operating Partnership Units held by each of the redeemable noncontrolling interest and the noncontrolling interests at
December 31, 2012
and
2011
by the total Operating Partnership Units outstanding at
December 31, 2012
and
2011
, respectively. The redeemable noncontrolling interest ownership percentage in assets and liabilities of the Operating Partnership was
0.8%
at
December 31, 2012
and
2011
. The noncontrolling interest ownership percentage in assets and liabilities of the Operating Partnership was
14.7%
and
21.3%
at
December 31, 2012
and
2011
, respectively.
Income is allocated to the Operating Partnership’s redeemable noncontrolling interest and noncontrolling interests based on their weighted average ownership during the year. The ownership percentages are determined by dividing the weighted average number of Operating Partnership Units held by each of the redeemable noncontrolling interest and noncontrolling interests by the total weighted average number of Operating Partnership Units outstanding during the year.
A change in the number of shares of common stock or Operating Partnership Units changes the percentage ownership of all partners of the Operating Partnership. An Operating Partnership Unit is considered to be equivalent to a share of common stock since it generally is exchangeable for shares of the Company’s common stock or, at the Company’s election, their cash equivalent. As a result, an allocation is made between redeemable noncontrolling interest, shareholders’ equity and noncontrolling interests in the Operating Partnership in the accompanying balance sheet to reflect the change in ownership of the Operating Partnership’s underlying equity when there is a change in the number of shares and/or Operating Partnership Units outstanding. During
2012
,
2011
and
2010
, the Company allocated
$3,197
,
$3,005
and
$3,139
, respectively, from shareholders’ equity to redeemable noncontrolling interest. During
2012
,
2011
and
2010
, the Company allocated
$163
,
$2,200
and
$12,433
, respectively, from shareholders' equity to noncontrolling interest.
The total redeemable noncontrolling interest in the Operating Partnership was
$33,835
and
$26,036
at
December 31, 2012
and
2011
, respectively. The total noncontrolling interest in the Operating Partnership was
$128,907
and
$202,833
at
December 31, 2012
and
2011
, respectively.
On November 28, 2012, the Operating Partnership declared distributions of
$1,143
and
$7,062
to the Operating Partnership’s redeemable noncontrolling limited partners and noncontrolling limited partners, respectively. The distributions were paid on January 16, 2012. This distribution represented a distribution of
$0.22
per unit for each common unit and
$0.7322
to
$0.7572
per unit for certain special common units in the Operating Partnership. The total distribution is included in accounts payable and accrued liabilities at December 31, 2012.
On November 30, 2011, the Operating Partnership declared distributions of
$1,143
and
$9,418
to the Operating Partnership’s redeemable noncontrolling limited partners and noncontrolling limited partners, respectively. The distributions were paid on January 16, 2013. This distribution represented a distribution of
$0.22
per unit for each common unit and
$0.7322
to
$0.7572
per unit for certain special common units in the Operating Partnership. The total distribution is included in accounts payable and accrued liabilities at December 31, 2011.
Redeemable Noncontrolling Interests and Noncontrolling Interests in Other Consolidated Subsidiaries
Redeemable noncontrolling interests includes the aggregate noncontrolling ownership interest in five of the Company’s other consolidated subsidiaries that is held by third parties and for which the related partnership agreements contain redemption provisions at the holder’s election that allow for redemption through cash and/or properties. The total redeemable noncontrolling interests in other consolidated subsidiaries was
$430,247
and
$430,069
at
December 31, 2012
and
2011
, respectively.
The redeemable noncontrolling interests in other consolidated subsidiaries includes the third party interest in the Company’s subsidiary that provides security and maintenance services and the perpetual preferred joint venture units (“PJV units”) issued to Westfield Group (“Westfield”) for its preferred interest in CW Joint Venture, LLC, a Company-controlled entity (“CWJV”), consisting of four of the Company’s other consolidated subsidiaries. Activity related to the redeemable noncontrolling preferred joint venture interest represented by the PJV units is as follows:
|
|
|
|
|
|
|
|
|
|
Year Ended December 31,
|
|
2012
|
|
2011
|
Beginning Balance
|
$
|
423,834
|
|
|
$
|
423,834
|
|
Net income attributable to redeemable noncontrolling
preferred joint venture interest
|
20,686
|
|
|
20,637
|
|
Distributions to redeemable noncontrolling
preferred joint venture interest
|
(20,686
|
)
|
|
(20,637
|
)
|
Ending Balance
|
$
|
423,834
|
|
|
$
|
423,834
|
|
See
Note 14
for additional information regarding the PJV units.
The Company had
26
and
18
other consolidated subsidiaries at
December 31, 2012
and
2011
, respectively, that had noncontrolling interests held by third parties and for which the related partnership agreements either do not include redemption provisions or are subject to redemption provisions that do not require classification outside of permanent equity. The total noncontrolling interests in other consolidated subsidiaries was
$63,497
and
$4,280
at
December 31, 2012
and
2011
, respectively.
The assets and liabilities allocated to the redeemable noncontrolling interests and noncontrolling interests in other consolidated subsidiaries are based on the third parties’ ownership percentages in each subsidiary at
December 31, 2012
and
2011
. Income is allocated to the redeemable noncontrolling interests and noncontrolling interests in other consolidated subsidiaries based on the third parties’ weighted average ownership in each subsidiary during the year.
Variable Interest Entities
Kirkwood Mall Mezz, LLC
On December 27, 2012, the Company entered into a joint venture, Kirkwood Mall Mezz, LLC, to acquire a
49%
ownership interest in Kirkwood Mall located in Bismarck, ND. The Company executed an agreement to acquire the remaining
51%
interest within 90 days subject to lender approval to assume
$40,368
of non-recourse debt. See
Note 3
for additional information. The Company determined that its investment in this joint venture represents a variable interest in a VIE and that the Company is the primary beneficiary since under the terms of the agreement the Company's equity investment is at risk while the third party has a fixed price for which it will sell its remaining
51%
equity interest to the Company. As a result, the joint venture is presented in the accompanying consolidated financial statements as of
December 31, 2012
on a consolidated basis, with the interests of the third party reflected as a noncontrolling interest. At
December 31, 2012
, this joint venture had total assets of
$102,936
and a mortgage note payable of
$40,368
.
Gettysburg Outlet Holding, LLC
In the second quarter of 2012, the Company entered into a joint venture, Gettysburg Outlet Center Holding LLC, with a third party to develop, own, and operate The Outlet Shoppes at Gettysburg. The Company holds a
50%
ownership interest in this joint venture. The Company determined that its investment in this joint venture represents a variable interest in a VIE and that the Company is the primary beneficiary since it has the power to direct activities of the joint venture that most significantly impact the joint venture's economic performance. As a result, the joint venture is presented in the accompanying consolidated financial statements as of
December 31, 2012
on a consolidated basis, with the interests of the third party reflected as a noncontrolling interest. At
December 31, 2012
, this joint venture had total assets of
$45,047
and a mortgage note payable of
$40,170
.
El Paso Outlet Center Holding, LLC
In the second quarter of 2012, the Company entered into a joint venture, El Paso Outlet Center Holding, LLC, with a third party to develop, own, and operate The Outlet Shoppes at El Paso. The Company holds a
75%
ownership interest in the joint venture. The Company determined that its investment in this joint venture represents a variable interest in a VIE and that the Company is the primary beneficiary since it has the power to direct activities of the joint venture that most significantly impact the joint venture's economic performance. As a result, the joint venture is presented in the accompanying consolidated financial statements as of
December 31, 2012
on a consolidated basis, with the interests of the third party reflected as a noncontrolling interest. At
December 31, 2012
, this joint venture had total assets of
$121,499
and a mortgage note payable of
$66,367
.
Imperial Valley Commons, L.P.
In December 2012, the Company completed its acquisition of the
40%
noncontrolling interest in Imperial Valley Commons, L.P. The Company previously had a
60%
ownership interest in the joint venture with a third party for the potential development of Imperial Valley Commons, a community retail shopping center in El Centro, CA. The Company determined that its investment represented a variable interest in a VIE and that the Company was the primary beneficiary since it had the ability to direct the activities of the joint venture that most significantly impacted the joint venture’s economic performance. As a result, the joint venture was presented in the accompanying consolidated financial statements as of December 31, 2011 on a consolidated basis, with any interests of the third party reflected as noncontrolling interest. At December 31, 2011, this joint venture had total assets of
$26,680
and was not encumbered. Following the Company's acquisition of the noncontrolling interest in December 2012, this subsidiary is now wholly-owned, and is no longer a VIE
PPG Venture I Limited Partnership
The Company had a
10%
ownership interest and was the primary beneficiary in the PPG Venture I Limited Partnership. As a result, the Company consolidated this joint venture. In 2011, the joint venture owned and operated Willowbrook Plaza in Houston, TX, Massard Crossing in Ft. Smith, AR and Pemberton Plaza in Vicksburg, MS. Willowbrook Plaza and Massard Crossing were sold in 2012. See
Note 4
for additional information related to these dispositions. At
December 31, 2011
, this joint venture had total assets of
$49,373
and a mortgage note payable of
$34,349
. Pemberton Plaza was distributed out of the joint venture to the Company prior to
December 31, 2012
and the joint venture was dissolved in January 2013.
NOTE 9. MINIMUM RENTS
The Company receives rental income by leasing retail shopping center space under operating leases. Future minimum rents are scheduled to be received under non-cancellable tenant leases at
December 31, 2012
, as follows:
|
|
|
|
|
2013
|
$
|
606,929
|
|
2014
|
531,262
|
|
2015
|
469,128
|
|
2016
|
398,254
|
|
2017
|
325,306
|
|
Thereafter
|
1,071,570
|
|
|
$
|
3,402,449
|
|
Future minimum rents do not include percentage rents or tenant reimbursements that may become due.
NOTE 10. MORTGAGE AND OTHER NOTES RECEIVABLE
Each of the Company's mortgage notes receivable is collateralized by either a first mortgage, a second mortgage or by an assignment of
100%
of the partnership interests that own the real estate assets. Other notes receivable include amounts due from tenants or government sponsored districts and unsecured notes received from third parties as whole or partial consideration for property or investments. Interest rates on mortgage and other notes receivable range from
2.7%
to
12.0%
, with a weighted average interest rate of
7.33%
and
8.76%
at
December 31, 2012
and
2011
, respectively. Maturities of these notes receivable range from May 2014 to January 2047.
In May 2012, Woodstock GA Investments, LLC, a joint venture in which the Company owns a
75.0%
interest, entered into a
$6,581
loan agreement with an entity that owns an interest in land in Woodstock, GA, adjacent to the site of The Outlet Shoppes at Atlanta. The Company owns a
75.0%
interest in The Outlet Shoppes at Atlanta through its joint venture Atlanta Outlet Shoppes, LLC. The note receivable bears interest of
10.0%
through its maturity date in
May 2014
and is secured by the entity's interest in the adjacent land.
In September 2011, the Company and a noncontrolling interest investor purchased a mezzanine loan with a face amount of
$5,879
for
$5,300
, which represented a discount of
$579
. The borrower under the mezzanine loan was an entity that owned The Outlet Shoppes at Gettysburg, an outlet shopping center located in Gettysburg, PA. The loan bore interest at the greater of LIBOR plus
900
basis points or
10%
and matured on February 11, 2016. The terms of the mezzanine loan agreement provided that the Company and its noncontrolling interest investor could, subject to approval of the senior lender, convert the mezzanine loan into equity of the borrower. Upon conversion, the Company and noncontrolling investor would own
50.0%
and
12.6%
, respectively, of the borrower. The terms also provided that the Company could elect to acquire an additional
10%
interest in borrower for a total interest of
60%
. In April 2012, the Company and its noncontrolling interest partner exercised their rights under the terms of the agreement with the borrower and converted the mezzanine loan into a member interest in the outlet shopping center. See
Note 3
for additional information.
In December 2011, the Company entered into a loan agreement pursuant to which the Company loaned
$9,150
to an entity that owned The Outlet Shoppes at El Paso, an outlet shopping center located in El Paso, TX. The note receivable bore interest of
13.0%
through June 9, 2013, and thereafter, at the greater of
13.0%
or
LIBOR plus 900 basis points
. The loan matured upon the earlier of (i)
60
days prior to the maturity date of the senior loan on the outlet shopping center or (ii) the date on which the senior loan was fully repaid. The terms of the loan agreement provided that if the Company did not elect to acquire a
75%
interest in the borrower, the Company could convert the loan into a non-voting common interest in the borrower, subject to the approval of the senior lender. In April 2012, the Company acquired a
75.0%
interest in the outlet shopping center and the borrower used a portion of the proceeds to repay the
$9,150
mezzanine loan to the Company. See
Note 3
for additional information.
The Company reviews its mortgage and other notes receivable to determine if the balances are realizable based on factors affecting the collectibility of those balances. Factors may include credit quality, timeliness of required periodic payments, past due status and management discussions with obligors. During the first quarter of 2011, the Company was notified that a receivable due in March 2011 of
$3,735
would not be repaid. The receivable was secured by land and, as such, the Company recorded an allowance for credit losses of
$1,500
in other expense and wrote down the amount of the note receivable to the estimated fair value of the land. The Company did not accrue any interest on the receivable for the three months ended March 31, 2011 and has written off any interest that was accrued and outstanding on the loan. The Company gained title to the land during the third quarter of 2011 and reclassified the balance of the note receivable to land. During the third quarter of 2011 the Company wrote off a note receivable from a tenant in the amount of
$400
. A rollforward of the allowance for credit losses for the year ended December 31, 2011 is as follows:
|
|
|
|
|
Beginning Balance, January 1, 2011
|
$
|
—
|
|
Additions in allowance charged to expense
|
1,900
|
|
Reduction for charges against allowance
|
(1,900
|
)
|
Ending Balance, December 31, 2011
|
$
|
—
|
|
As of
December 31, 2012
, the Company believes that its mortgage and other notes receivable balance of
$25,967
is fully collectible.
See subsequent event related to Woodstock GA Investments, LLC note receivable in
Note 20
.
NOTE 11. SEGMENT INFORMATION
The Company measures performance and allocates resources according to property type, which is determined based on certain criteria such as type of tenants, capital requirements, economic risks, leasing terms, and short- and long-term returns on
capital. Rental income and tenant reimbursements from tenant leases provide the majority of revenues from all segments. The accounting policies of the reportable segments are the same as those described in
Note 2
. Information on the Company’s reportable segments is presented as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year Ended December 31, 2012
|
|
Malls
|
|
Associated
Centers
|
|
Community
Centers
|
|
All
Other
(1)
|
|
Total
|
Revenues
|
|
$
|
929,423
|
|
|
$
|
42,380
|
|
|
$
|
11,966
|
|
|
$
|
50,871
|
|
|
$
|
1,034,640
|
|
Property operating expenses
(2)
|
|
(296,298
|
)
|
|
(10,480
|
)
|
|
(4,084
|
)
|
|
21,955
|
|
|
(288,907
|
)
|
Interest expense
|
|
(216,217
|
)
|
|
(8,453
|
)
|
|
(2,568
|
)
|
|
(17,194
|
)
|
|
(244,432
|
)
|
Other expense
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(25,078
|
)
|
|
(25,078
|
)
|
Gain on sales of real estate assets
|
|
1,188
|
|
|
202
|
|
|
677
|
|
|
219
|
|
|
2,286
|
|
Segment profit
|
|
$
|
418,096
|
|
|
$
|
23,649
|
|
|
$
|
5,991
|
|
|
$
|
30,773
|
|
|
$
|
478,509
|
|
Depreciation and amortization expense
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(265,856
|
)
|
General and administrative expense
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(51,251
|
)
|
Interest and other income
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3,955
|
|
Gain on extinguishment of debt
|
|
|
|
|
|
|
|
|
|
|
|
|
|
265
|
|
Loss on impairment of real estate
(4)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(24,379
|
)
|
Gain on investment
|
|
|
|
|
|
|
|
|
|
45,072
|
|
Equity in earnings of unconsolidated affiliates
|
|
|
|
|
|
|
|
|
|
|
|
|
|
8,313
|
|
Income tax provision
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1,404
|
)
|
Income from continuing operations
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
193,224
|
|
Total assets
|
|
$
|
6,213,801
|
|
|
$
|
302,225
|
|
|
$
|
203,261
|
|
|
$
|
370,449
|
|
|
$
|
7,089,736
|
|
Capital expenditures
(3)
|
|
$
|
608,190
|
|
|
$
|
6,630
|
|
|
$
|
13,884
|
|
|
$
|
76,319
|
|
|
$
|
705,023
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year Ended December 31, 2011
|
|
Malls
|
|
Associated
Centers
|
|
Community
Centers
|
|
All
Other
(1)
|
|
Total
|
Revenues
|
|
$
|
951,152
|
|
|
$
|
41,505
|
|
|
$
|
10,639
|
|
|
$
|
48,018
|
|
|
$
|
1,051,314
|
|
Property operating expenses
(2)
|
|
(304,479
|
)
|
|
(10,689
|
)
|
|
(2,978
|
)
|
|
21,962
|
|
|
(296,184
|
)
|
Interest expense
|
|
(233,777
|
)
|
|
(8,841
|
)
|
|
(3,894
|
)
|
|
(20,560
|
)
|
|
(267,072
|
)
|
Other expense
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(28,898
|
)
|
|
(28,898
|
)
|
Gain (loss) on sales of real estate assets
|
|
(13,329
|
)
|
|
306
|
|
|
1,135
|
|
|
71,284
|
|
|
59,396
|
|
Segment profit
|
|
$
|
399,567
|
|
|
$
|
22,281
|
|
|
$
|
4,902
|
|
|
$
|
91,806
|
|
|
518,556
|
|
Depreciation and amortization expense
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(271,458
|
)
|
General and administrative expense
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(44,751
|
)
|
Interest and other income
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2,583
|
|
Gain on extinguishment of debt
|
|
|
|
|
|
|
|
|
|
1,029
|
|
Loss on impairment of real estate
(4)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(51,304
|
)
|
Equity in earnings of unconsolidated affiliates
|
|
|
|
|
|
|
|
|
|
|
|
|
6,138
|
|
Income tax benefit
|
|
|
|
|
|
|
|
|
|
|
|
|
|
269
|
|
Income from continuing operations
(4)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
161,062
|
|
Total assets
|
|
$
|
5,954,414
|
|
|
$
|
308,858
|
|
|
$
|
265,675
|
|
|
$
|
190,481
|
|
|
$
|
6,719,428
|
|
Capital expenditures
(3)
|
|
$
|
265,478
|
|
|
$
|
213,364
|
|
|
$
|
21,452
|
|
|
$
|
16,984
|
|
|
$
|
517,278
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year Ended December 31, 2010
|
|
Malls
|
|
Associated
Centers
|
|
Community
Centers
|
|
All
Other
(1)
|
|
Total
|
Revenues
|
|
$
|
953,893
|
|
|
$
|
40,311
|
|
|
$
|
8,140
|
|
|
$
|
43,359
|
|
|
$
|
1,045,703
|
|
Property operating expenses
(2)
|
|
(306,168
|
)
|
|
(10,528
|
)
|
|
(1,948
|
)
|
|
25,096
|
|
|
(293,548
|
)
|
Interest expense
|
|
(228,346
|
)
|
|
(7,794
|
)
|
|
(2,609
|
)
|
|
(42,353
|
)
|
|
(281,102
|
)
|
Other expense
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(25,523
|
)
|
|
(25,523
|
)
|
Gain (loss) on sales of real estate assets
|
|
1,754
|
|
|
—
|
|
|
1,144
|
|
|
(11
|
)
|
|
2,887
|
|
Segment profit
|
|
$
|
421,133
|
|
|
$
|
21,989
|
|
|
$
|
4,727
|
|
|
$
|
568
|
|
|
448,417
|
|
Depreciation and amortization expense
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(280,575
|
)
|
General and administrative expense
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(43,383
|
)
|
Interest and other income
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3,868
|
|
Gain on investment
|
|
|
|
|
|
|
|
|
|
|
|
|
|
888
|
|
Loss on impairment of real estate
(4)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1,156
|
)
|
Equity in losses of unconsolidated affiliates
|
|
|
|
|
|
|
|
|
|
|
|
|
(188
|
)
|
Income tax benefit
|
|
|
|
|
|
|
|
|
|
|
|
|
|
6,417
|
|
Income from continuing operations
(4)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
134,288
|
|
Total assets
|
|
$
|
6,561,098
|
|
|
$
|
325,395
|
|
|
$
|
67,252
|
|
|
$
|
552,809
|
|
|
$
|
7,506,554
|
|
Capital expenditures
(3)
|
|
$
|
98,277
|
|
|
$
|
7,931
|
|
|
$
|
25,050
|
|
|
$
|
53,856
|
|
|
$
|
185,114
|
|
|
|
(1)
|
The All Other category includes mortgage and other notes receivable, office buildings, the Management Company and the Company’s subsidiary that provides security and maintenance services.
|
|
|
(2)
|
Property operating expenses include property operating, real estate taxes and maintenance and repairs.
|
|
|
(3)
|
Amounts include acquisitions of real estate assets and investments in unconsolidated affiliates. Developments in progress are included in the All Other category.
|
|
|
(4)
|
The referenced amounts for the years ended December 31, 2011 and 2010 have been restated. See
Note 2
for more information. Loss on impairment of real estate for the year ended December 31, 2012 consisted of
$20,315
related to Malls,
$3,000
related to Associated Centers and
$1,064
related to All Other. Loss on impairment of real estate for the year ended December 31, 2011 consisted of
$50,683
related to Malls and
$621
related to All Other. Loss on impairment of real estate for the year ended December 31, 2010 consisted of
$1,156
related to All Other.
|
NOTE 12. SUPPLEMENTAL AND NONCASH INFORMATION
The Company paid cash for interest, net of amounts capitalized, in the amount of
$233,220
,
$265,430
and
$278,783
during
2012
,
2011
and
2010
, respectively.
The Company’s noncash investing and financing activities for
2012
,
2011
and
2010
were as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2012
|
|
2011
|
|
2010
|
Accrued dividends and distributions payable
|
$
|
43,689
|
|
|
$
|
41,717
|
|
|
$
|
41,833
|
|
Additions to real estate assets accrued but not yet paid
|
22,468
|
|
|
21,771
|
|
|
19,125
|
|
Issuance of noncontrolling interests in Operating Partnership
|
14,000
|
|
|
—
|
|
|
—
|
|
Conversion of operating partnership units to common stock
|
59,738
|
|
|
729
|
|
|
56,338
|
|
Addition to real estate assets from conversion of note receivable
|
4,522
|
|
|
—
|
|
|
—
|
|
Assumption of mortgage notes payable in acquisitions
|
220,634
|
|
|
—
|
|
|
—
|
|
Consolidation of joint venture:
|
|
|
|
|
|
|
|
Decrease in investment in unconsolidated affiliates
|
(15,643
|
)
|
|
—
|
|
|
(15,175
|
)
|
Increase in real estate assets
|
111,407
|
|
|
—
|
|
|
33,706
|
|
Increase in intangible lease and other assets
|
18,426
|
|
|
—
|
|
|
3,240
|
|
Increase in mortgage and other indebtedness
|
54,169
|
|
|
—
|
|
|
21,753
|
|
Deconsolidation of joint ventures:
|
|
|
|
|
|
|
|
Decrease in real estate assets
|
—
|
|
|
365,971
|
|
|
—
|
|
Decrease in intangible lease and other assets
|
—
|
|
|
26,798
|
|
|
—
|
|
Decrease in mortgage notes payable
|
—
|
|
|
(266,224
|
)
|
|
—
|
|
Increase in investment in unconsolidated affiliates
|
—
|
|
|
(123,651
|
)
|
|
—
|
|
Decrease in accounts payable and accrued liabilities
|
—
|
|
|
(4,395
|
)
|
|
—
|
|
Additions to real estate assets from forgiveness of mortgage note receivable
|
—
|
|
|
2,235
|
|
|
—
|
|
Notes receivable from sale of interest in unconsolidated affiliate
|
—
|
|
|
—
|
|
|
1,001
|
|
Distribution of real estate assets from unconsolidated affiliate
|
—
|
|
|
—
|
|
|
12,210
|
|
Issuance of additional redeemable noncontrolling preferred joint venture interests
|
—
|
|
|
—
|
|
|
2,146
|
|
Reclassification of mortgage and other notes receivable to other assets
|
—
|
|
|
—
|
|
|
7,269
|
|
NOTE 13. RELATED PARTY TRANSACTIONS
Certain executive officers of the Company and members of the immediate family of Charles B. Lebovitz, Chairman of the Board of the Company, collectively have a significant noncontrolling interest in EMJ Corporation ("EMJ"), a construction company that the Company engaged to build substantially all of the Company’s development Properties. The Company paid approximately
$49,153
,
$59,668
and
$36,922
to EMJ in
2012
,
2011
and
2010
, respectively, for construction and development activities. The Company had accounts payable to EMJ of
$2,096
and
$6,721
at
December 31, 2012
and
2011
, respectively.
Certain executive officers of the Company also collectively had a significant noncontrolling interest in Electrical and Mechanical Group, Inc. (“EMG”), a company to which EMJ subcontracted a portion of its services for the Company. The Company had also engaged EMG directly for certain services. EMJ paid approximate
ly
$15
,
$981
and
$1,189
to EMG in
2012
,
2011
and
2010
, respectively, for such subcontracted services. The Company paid approximately,
$0
,
$86
and
$203
, respectively, directly to EMG in
2012
,
2011
and
2010
for services which EMG performed directly for the Company. EMG
was dissolved in 2012.
The Management Company provides management, development and le
asing services to the Company’s unconsolidated affiliates and other affiliated partnerships. Revenues recognized for these services amounted to
$7,531
,
$4,822
and
$4,835
in
2012
,
2011
and
2010
, respectively.
NOTE 14. CONTINGENCIES
On March 11, 2010, TPD, a subsidiary of the Company, filed a lawsuit in the Circuit Court of Harrison County, Mississippi, against M Hanna, Gallet & Associates, Inc., LA Ash, Inc., EMJ and JEA (f/k/a Jacksonville Electric Authority), seeking damages for alleged property damage and related damages occurring at a shopping center development in D'Iberville, Mississippi. EMJ filed an answer and counterclaim denying liability and seeking to recover from TPD the retainage of approximately
$327
allegedly owed under the construction contract. Kohl's was granted permission to intervene in the lawsuit and, on April 13, 2011, filed a cross-claim against TPD alleging that TPD is liable to Kohl's for unspecified damages resulting from the actions of the defendants and for the failure to perform the obligations of TPD under a Site Development Agreement with Kohl's. Kohl's also made a claim against the Company which guaranteed the performance of TPD under the Site Development Agreement. The case is at the discovery stage.
TPD also has filed claims under several insurance policies in connection with this matter, and there are three pending lawsuits relating to insurance coverage. On October 8, 2010, First Mercury filed an action in the United States District Court for the Eastern District of Texas against M Hanna and TPD seeking a declaratory judgment concerning coverage under a liability insurance policy issued by First Mercury to M Hanna. That case was dismissed for lack of federal jurisdiction and refiled in Texas state court. On June 13, 2011, TPD filed an action in the Chancery Court of Hamilton County, Tennessee against National Union and EMJ seeking a declaratory judgment regarding coverage under a liability insurance policy issued by National Union to EMJ and recovery of damages arising out of National Union's breach of its obligations. In March 2012, Zurich American and Zurich American of Illinois, which also have issued liability insurance policies to EMJ, intervened in that case and the case is set for trial on October 29, 2013. On February 14, 2012, TPD filed claims in the United States District Court for the Southern District of Mississippi against Factory Mutual Insurance Company and Federal Insurance Company seeking a declaratory judgment concerning coverage under certain builders risk and property insurance policies issued by those respective insurers to the Company.
Certain executive officers of the Company and members of the immediate family of Charles B. Lebovitz, Chairman of the Board of the Company, collectively have a significant non-controlling interest in EMJ, a major national construction company that the Company engaged to build a substantial number of the Company's Properties. EMJ is one of the defendants in the Harrison County, MS and Hamilton County, TN cases described above.
The Company also is currently involved in certain litigation that arises in the ordinary course of business. The Company does not believe that the pending litigation will have a materially adverse effect on the Company's financial position or results of operations.
Additionally, management believes that, based on environmental studies completed to date, any exposure to environmental cleanup will not materially affect the financial position and results of operations of the Company.
The Company consolidates its investment in a joint venture, CW Joint Venture, LLC ("CWJV") with Westfield. The terms of the joint venture agreement require that CWJV pay an annual preferred distribution at a rate of
5.0%
, which increased to
6.0%
on July 1, 2013, on the preferred liquidation value of the PJV units of CWJV that are held by Westfield. Westfield has the right to have all or a portion of the PJV units redeemed by CWJV with property owned by CWJV, and subsequent to October 16, 2012, with either cash or property owned by CWJV, in each case for a net equity amount equal to the preferred liquidation value of the PJV units. At any time after January 1, 2013, Westfield may propose that CWJV acquire certain qualifying property that
would be used to redeem the PJV units at their preferred liquidation value. If CWJV does not redeem the PJV units with such qualifying property (a “Preventing Event”), then the annual preferred distribution rate on the PJV units increases to
9.0%
beginning July 1, 2013. The Company will have the right, but not the obligation, to offer to redeem the PJV units from January 31, 2013 through January 31, 2015 at their preferred liquidation value, plus accrued and unpaid distributions. The Company amended the joint venture agreement with Westfield in September 2012 to provide that, if the Company exercises its right to offer to redeem the PJV units on or before August 1, 2013, then the preferred liquidation value will be reduced by
$10,000
so long as Westfield does not reject the offer and the redemption closes on or before September 30, 2013. If the Company fails to make such an offer, the annual preferred distribution rate on the PJV units increases to
9.0%
for the period from July 1, 2013 through June 30, 2016, at which time it decreases to
6.0%
if a Preventing Event has not occurred. If, upon redemption of the PJV units, the fair value of the Company’s common stock is greater than
$32.00
per share, then such excess (but in no case greater than
$26,000
in the aggregate) shall be added to the aggregate preferred liquidation value payable on account of the PJV units. The Company accounts for this contingency using the method prescribed for earnings or other performance measure contingencies. As such, should this contingency result in additional consideration to Westfield, the Company will record the current fair value of the consideration issued as a purchase price adjustment at the time the consideration is paid or payable.
Guarantees
The Company may guarantee the debt of a joint venture primarily because it allows the joint venture to obtain funding at a lower cost than could be obtained otherwise. This results in a higher return for the joint venture on its investment, and a higher return on the Company’s investment in the joint venture. The Company may receive a fee from the joint venture for providing the guaranty. Additionally, when the Company issues a guaranty, the terms of the joint venture agreement typically provide that the Company may receive indemnification from the joint venture or have the ability to increase its ownership interest.
The Company owns a parcel of land in Lee's Summit, MO that it is ground leasing to a third party development company. The third party developed and operates a shopping center on the land parcel. The Company has guaranteed
27%
of the third party’s construction loan and bond line of credit (the “loans”) of which the maximum guaranteed amount, representing
27%
of capacity, is approximately
$15,183
. In the third quarter of 2012, the loans were modified and extended to December 2012. In August 2012, proceeds from a bond issuance were applied to reduce
$10,357
of the outstanding balance on the bond line of credit. Additionally,
$1,000
of the construction loan was repaid. The total amount outstanding at
December 31, 2012
on the loans was
$49,345
of which the Company has guaranteed
$13,323
. The Company included an obligation of
$192
in the accompanying consolidated balance sheets as of
December 31, 2012
and
2011
to reflect the estimated fair value of the guaranty. The loan matured in December 2012. The third party developer is working with the lender to extend the maturity date of the loan. The Company has not increased its accrual for the contingent obligation as the Company does not believe that this contingent obligation is probable.
The Company has guaranteed
100%
of the construction and land loans of West Melbourne I, LLC (“West Melbourne”), an unconsolidated affiliate in which the Company owns a
50%
interest, of which the maximum guaranteed amount is
$45,352
. West Melbourne developed and operates Hammock Landing, a community center in West Melbourne, FL. The total amount outstanding on the loans at
December 31, 2012
was
$45,352
. The guaranty will expire upon repayment of the debt. The land loan and the construction loan, each representing
$2,921
and
$42,431
, respectively, of the amount outstanding at
December 31, 2012
, mature in November 2013. The construction loan has a one-year extension option available. The Company recorded an obligation of
$478
in the accompanying consolidated balance sheets as of
December 31, 2012
and
2011
to reflect the estimated fair value of this guaranty.
The Company has guaranteed
100%
of the construction loan of Port Orange, an unconsolidated affiliate in which the Company owns a
50%
interest, of which the maximum guaranteed amount is
$63,030
. Port Orange developed and operates The Pavilion at Port Orange, a community center in Port Orange, FL. The total amount outstanding at
December 31, 2012
on the loan was
$63,030
. The guaranty will expire upon repayment of the debt. The loan matures in March 2014 and has a
one
-year extension option available. The Company has included an obligation of
$961
in the accompanying consolidated balance sheets as of
December 31, 2012
and
2011
to reflect the estimated fair value of this guaranty.
The Company has guaranteed the lease performance of YTC, an unconsolidated affiliate in which it owns a
50%
interest, under the terms of an agreement with a third party that owns property as part of York Town Center. Under the terms of that agreement, YTC is obligated to cause performance of the third party’s obligations as landlord under its lease with its sole tenant, including, but not limited to, provisions such as co-tenancy and exclusivity requirements. Should YTC fail to cause performance, then the tenant under the third party landlord’s lease may pursue certain remedies ranging from rights to terminate its lease to receiving reductions in rent. The Company has guaranteed YTC’s performance under this agreement up to a maximum of
$22,000
, which decreases by
$800
annually until the guaranteed amount is reduced to
$10,000
. The guaranty expires on December 31, 2020. The maximum guaranteed obligation was
$17,200
as of
December 31, 2012
. The Company entered into an agreement with its joint venture partner under which the joint venture partner has agreed to reimburse the Company
50%
of any amounts it is
obligated to fund under the guaranty. The Company did not record an obligation for this guaranty because it determined that the fair value of the guaranty was not material as of
December 31, 2012
and
2011
.
In July 2012, the Company guaranteed
100%
of a term loan for Gulf Coast, an unconsolidated affiliate in which the Company owns a
50%
interest, of which the maximum guaranteed amount is
$6,786
. The loan is for the third phase expansion of Gulf Coast Town Center, a shopping center located in Ft. Myers, FL. The total amount outstanding as of
December 31, 2012
on the loan was
$6,786
. The guaranty will expire upon repayment of the debt. The loan matures in
July 2015
. The Company did not record an obligation for this guaranty because it determined that the fair value of the guaranty was not material as of
December 31, 2012
.
Performance Bonds
The Company has issued various bonds that it would have to satisfy in the event of non-performance. The total amount outstanding on these bonds was
$29,211
and
$11,156
at
December 31, 2012
and
2011
, respectively.
Ground Leases
The Company is the lessee of land at certain of its Properties under long-term operating leases, which include scheduled increases in minimum rents. The Company recognizes these scheduled rent increases on a straight-line basis over the initial lease terms. Most leases have initial terms of at least
20
years and contain
one
or more renewal options, generally for a minimum of
five
- or
10
-year periods. Lease expense recognized in the consolidated statements of operations for
2012
,
2011
and
2010
was
$1,169
,
$1,967
and
$1,718
, respectively.
The future obligations under these operating leases at
December 31, 2012
, are as follows:
`
|
|
|
|
|
2013
|
$
|
775
|
|
2014
|
783
|
|
2015
|
790
|
|
2016
|
806
|
|
2017
|
807
|
|
Thereafter
|
28,411
|
|
|
$
|
32,372
|
|
NOTE 15. FAIR VALUE MEASUREMENTS
The Company has categorized its financial assets and financial liabilities that are recorded at fair value into a hierarchy in accordance with ASC 820,
Fair Value Measurements and Disclosure
, ("ASC 820") based on whether the inputs to valuation techniques are observable or unobservable. The fair value hierarchy contains three levels of inputs that may be used to measure fair value as follows:
Level 1 – Inputs represent quoted prices in active markets for identical assets and liabilities as of the measurement date.
Level 2 – Inputs, other than those included in Level 1, represent observable measurements for similar instruments in active markets, or identical or similar instruments in markets that are not active, and observable measurements or market data for instruments with substantially the full term of the asset or liability.
Level 3 – Inputs represent unobservable measurements, supported by little, if any, market activity, and require considerable assumptions that are significant to the fair value of the asset or liability. Market valuations must often be determined using discounted cash flow methodologies, pricing models or similar techniques based on the Company’s assumptions and best judgment.
The asset or liability's fair value within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. Under ASC 820, fair value measurements are determined based on the assumptions that market participants would use in pricing the asset or liability in an orderly transaction at the measurement date. Valuation techniques used maximize the use of observable inputs and minimize the use of unobservable inputs and consider assumptions such as inherent risk, transfer restrictions and risk of nonperformance.
Fair Value Measurements on a Recurring Basis
The following tables set forth information regarding the Company’s financial instruments that are measured at fair value on a recurring basis in the accompanying consolidated balance sheets as of
December 31, 2012
and
2011
:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fair Value Measurements at Reporting Date Using
|
|
Fair Value at December 31, 2012
|
|
Quoted Prices in Active Markets
for Identical
Assets (Level 1)
|
|
Significant
Other
Observable
Inputs (Level 2)
|
|
Significant Unobservable
Inputs (Level 3)
|
Assets:
|
|
|
|
|
|
|
|
Available-for-sale securities
|
27,679
|
|
|
16,556
|
|
|
—
|
|
|
11,123
|
|
Privately held debt and equity securities
|
2,475
|
|
|
—
|
|
|
—
|
|
|
2,475
|
|
Interest rate cap
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
|
|
|
|
|
|
Liabilities:
|
|
|
|
|
|
|
|
Interest rate swaps
|
5,805
|
|
|
—
|
|
|
5,805
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fair Value Measurements at Reporting Date Using
|
|
Fair Value at December 31, 2011
|
|
Quoted Prices in Active Markets
for Identical
Assets (Level 1)
|
|
Significant
Other
Observable
Inputs (Level 2)
|
|
Significant Unobservable
Inputs (Level 3)
|
Assets:
|
|
|
|
|
|
|
|
Available-for-sale securities
|
$
|
30,613
|
|
|
$
|
18,784
|
|
|
$
|
—
|
|
|
$
|
11,829
|
|
Privately held debt and equity securities
|
2,475
|
|
|
—
|
|
|
—
|
|
|
2,475
|
|
|
|
|
|
|
|
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
Interest rate swaps
|
$
|
5,617
|
|
|
$
|
—
|
|
|
$
|
5,617
|
|
|
$
|
—
|
|
The Company recognizes transfers in and out of every level at the end of each reporting period. There were
no
transfers between Levels 1 and 2 during the years ended
December 31, 2012
and
2011
.
Intangible lease assets and other assets in the consolidated balance sheets include marketable securities consisting of corporate equity securities, mortgage/asset-backed securities, mutual funds and bonds that are classified as available for sale. Net unrealized gains and losses on available-for-sale securities that are deemed to be temporary in nature are recorded as a component of accumulated other comprehensive income in redeemable noncontrolling interests, shareholders’ equity and noncontrolling interests. The Company recognized realized gains of
$224
related to sales of marketable securities during the year ended December 31, 2012. The Company recognized realized losses of
$22
and
$114
related to sales of marketable securities during the years ended December 31, 2011 and 2010, respectively. During the years ended
December 31, 2012
,
2011
and
2010
, the Company did not recognize any write-downs for other-than-temporary impairments. The fair value of the Company’s available-for-sale securities is based on quoted market prices and, thus, is classified under Level 1. Tax increment financing bonds ("TIF bonds") are classified as Level 3. See
Note 2
for a summary of the available-for-sale securities held by the Company.
The Company uses interest rate swaps and caps to mitigate the effect of interest rate movements on its variable-rate debt. The Company had
four
interest rate swaps and
one
interest rate cap as of
December 31, 2012
that qualify as hedging instruments and are designated as cash flow hedges. The interest rate cap is included in intangible lease assets and other assets and the interest rate swaps are reflected in accounts payable and accrued liabilities in the accompanying consolidated balance sheets. The swaps and cap have predominantly met the effectiveness test criteria since inception and changes in their fair values are, thus, primarily reported in other comprehensive income (loss) and are reclassified into earnings in the same period or periods during which the hedged item affects earnings. The fair values of the Company’s interest rate hedges, classified under Level 2, are determined using a proprietary model which is based on prevailing market data for contracts with matching durations, current and anticipated LIBOR or other interest basis information, consideration of the Company’s credit standing, credit risk of the counterparties and reasonable estimates about relevant future market conditions. See
Notes 2
and
6
for additional information regarding the Company’s interest rate hedging instruments.
The carrying values of cash and cash equivalents, receivables, accounts payable and accrued liabilities are reasonable estimates of their fair values because of the short-term nature of these financial instruments. Based on the interest rates for similar financial instruments, the carrying value of mortgage and other notes receivable is a reasonable estimate of fair value. The fair value of mortgage and other indebtedness was
$5,058,411
and
$4,836,028
at
December 31, 2012
and
2011
, respectively. The fair value was calculated by discounting future cash flows for the notes payable using estimated market rates at which similar loans would be made currently.
The Company holds TIF bonds, which mature in
2028
, received in a private placement as consideration for infrastructure improvements made by the Company related to the development of a community center. The Company had the intent and ability to hold the TIF bonds through the recovery period. The bonds were redeemed in January 2013 and the Company adjusted the value of the bonds to their net realizable value as of
December 31, 2012
. Due to the significant unobservable estimates and assumptions used in the valuation of the TIF bonds, the Company has classified the TIF bonds under Level 3 in the fair value hierarchy. The following table provides a reconciliation of changes between the beginning and ending balances of items measured at fair value on a recurring basis in the tables above that used significant unobservable inputs (Level 3):
|
|
|
|
|
|
|
|
Available For Sale Securities - Government and government
sponsored entities
|
Balance, January 1, 2011
|
|
$
|
11,829
|
|
Change in unrealized loss included in other comprehensive income
|
|
1,542
|
|
Transfer out of Level 3
(1)
|
|
(2,248
|
)
|
Balance, December 31, 2012
|
|
$
|
11,123
|
|
|
|
(1)
|
The TIF bonds were adjusted to their net realizable value as of December 31, 2012 with the difference in estimate recorded as a transfer to long-lived assets. See
for additional information related to the redemption of the bonds in January 2013.
|
In February 2007, the Company received a secured convertible promissory note from, and a warrant to acquire shares of, Jinsheng, in which the Company also holds a cost- method investment. See
Note 5
for additional information. The secured convertible note is non-interest bearing and is secured by shares of Jinsheng. Since the secured convertible note is non-interest bearing and there is no active market for Jinsheng’s debt, the Company performed an analysis on the note considering credit risk and discounting factors to determine the fair value. The warrant was initially valued using estimated share price and volatility variables in a Black Scholes model. Due to the significant estimates and assumptions used in the valuation of the note and warrant, the Company has classified these under Level 3. As part of its investment review as of March 31, 2009, the Company determined that its investment in Jinsheng was impaired on an other-than-temporary basis due to a decline in expected future cash flows as a result of declining occupancy and sales related to the then downturn of the real estate market in China. An impairment charge of
$2,400
is recorded in the Company’s consolidated statement of operations for the year ended December 31, 2009 to reduce the carrying values of the secured convertible note and warrant to their estimated fair values. The warrant expired in January 2010 and had no value. Since the secured convertible note is non-interest bearing and there is no active market for Jinsheng’s debt, the Company performed a probability-weighted discounted cash flow analysis using various sale, redemption and initial public offering ("IPO") exit strategies. The fair value analysis as of
December 31, 2012
forecasts a
0% to 10%
reduction in estimated cash flows. Sale and IPO scenarios employ capitalization rates ranging from
10%
to
12%
which are discounted
20%
for lack of marketability. Due to the significant unobservable estimates and assumptions used in the valuation of the note, the Company has classified it under Level 3 in the fair value hierarchy. Based on the valuation as of
December 31, 2012
, the Company determined that the current balance of the secured convertible note of
$2,475
is not impaired. There were no changes in the
$2,475
classified as privately held debt and equity securities (Level 3) for the period for the period from January 1, 2011 through
December 31, 2012
.
The significant unobservable inputs used in the fair value measurement of the Jinsheng note include revenue estimates and marketability discount. Significant increases (decreases) in revenues could result in a significantly higher (lower) fair value measurement whereas significant increases (decreases) in the marketability discount could result in a significantly lower (higher) fair value measurement.
Fair Value Measurements on a Nonrecurring Basis
The Company measures the fair value of certain long-lived assets on a nonrecurring basis, through quarterly impairment testing or when events or changes in circumstances indicate that the carrying amount of the assets may not be recoverable. The Company considers both quantitative and qualitative factors in its impairment analysis of long-lived assets. Significant quantitative factors include historical and forecasted information for each Property such as net operating income, occupancy statistics and sales levels. Significant qualitative factors used include market conditions, age and condition or the Property and tenant mix. Due to the significant unobservable estimates and assumptions used in the valuation of long-lived assets that experienced impairment, the Company has classified them under Level 3 in the fair value hierarchy. The fair value analysis for long-lived assets as of December 31, 2012 used various probability-weighted scenarios comparing the Property's net book value to the sum of its estimated fair value. Assumptions included up to a
10-year
holding period with a sale at the end of the holding period, capitalization rates ranging from
10%
to
12%
and an estimated sales cost of
1%
.
The following tables set forth information regarding the Company’s assets that are measured at fair value on a nonrecurring basis, restated for discontinued operations for all periods presented:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fair Value Measurements at Reporting Date Using
|
|
|
|
Fair Value at December 31, 2012
|
|
Quoted Prices in Active Markets
for Identical
Assets (Level 1)
|
|
Significant
Other
Observable
Inputs (Level 2)
|
|
Significant Unobservable
Inputs (Level 3)
|
|
Total Losses
|
Assets:
|
|
|
|
|
|
|
|
|
|
Long-lived assets
|
$
|
8,604
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
8,604
|
|
|
$
|
23,315
|
|
In December 2012, the Company acquired the remaining
40.0%
interest in Imperial Valley Commons L.P., a joint venture in which the Company held a 60.0% ownership interest. In accordance with the Company's impairment review process described in
Note 2
, the Company recorded a non-cash impairment of real estate of
$20,315
in the fourth quarter of 2012, related to vacant land available for the future expansion of Imperial Valley Commons located in El Centro, CA, to write down the book value as of December 31, 2012 from
$25,645
to
$5,330
. Development of this asset has been negatively impacted by recent economic conditions and other competition in the market area that have affected pre-development leasing activity.
In accordance with the Company's impairment review process described in
Note 2
, the Company recorded a non-cash impairment of real estate of
$3,000
in the third quarter of 2012 related to The Courtyard at Hickory Hollow, an associated center located in Antioch, TN, to write down the depreciated book value as of September 30, 2012 from
$5,843
to an estimated fair value of
$2,843
as of the same date. The revenues of The Courtyard at Hickory Hollow accounted for approximately 0.03% of total consolidated revenues for the year ended
December 31, 2012
. A reconciliation of the Property's carrying values for the year ended
December 31, 2012
is as follows:
|
|
|
|
|
|
The Courtyard at
Hickory Hollow
|
Beginning carrying value, January 1, 2012
|
$
|
5,754
|
|
Capital expenditures
|
644
|
|
Depreciation expense
|
(124
|
)
|
Loss on impairment of real estate
|
(3,000
|
)
|
Ending carrying value, December 31, 2012
|
$
|
3,274
|
|
During the year ended December 31, 2012, the Company recorded an impairment of real estate of
$1,064
related to the sale of
three
outparcels for total net proceeds after selling costs of
$1,186
, which were less than their total carrying amounts of
$2,250
.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fair Value Measurements at Reporting Date Using
|
|
|
|
Fair Value at December 31, 2011
|
|
Quoted Prices in Active Markets
for Identical
Assets (Level 1)
|
|
Significant
Other
Observable
Inputs (Level 2)
|
|
Significant Unobservable
Inputs (Level 3)
|
|
Total Losses
|
Asset:
|
|
|
|
|
|
|
|
|
|
Long-lived asset
|
$
|
6,141
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
6,141
|
|
|
$
|
50,683
|
|
In accordance with the Company's impairment review process described in
Note 2
, the Company recorded a non-cash impairment of real estate of
$50,683
in the third quarter of 2011 related to Columbia Place, a mall located in Columbia, SC, to write down the depreciated book value as of September 30, 2011 from
$56,746
to an estimated fair value of
$6,063
as of the same date. Columbia Place experienced declining cash flows as a result of changes in property-specific market conditions, which were further exacerbated by economic conditions that negatively impacted leasing activity and occupancy. The fair value reflected in the table above reflects the estimated fair value of Columbia Place as of September 30, 2011, adjusted for capital expenditures and depreciation expense during the fourth quarter of 2011.
The revenues of Columbia Place accounted for
less than 1.0%
of total consolidated revenues for the year ended December 31, 2011. A reconciliation of the Property's carrying values for the year ended December 31, 2011 is as follows:
|
|
|
|
|
|
Columbia Place
|
Beginning carrying value, January 1, 2011
|
$
|
58,207
|
|
Capital expenditures
|
142
|
|
Depreciation expense
|
(1,525
|
)
|
Loss on impairment of real estate
|
(50,683
|
)
|
Ending carrying value, December 31, 2011
|
$
|
6,141
|
|
In September 2011, the Company recorded an impairment of real estate of
$621
related to an outparcel that was sold for net proceeds after selling costs of
$1,477
, which was less than its carrying amount of
$2,098
.
In December 2010, the Company recorded an impairment of real estate of
$1,156
related to the sale of a parcel of land.
NOTE 16. SHARE-BASED COMPENSATION
As of
December 31, 2012
, there were two share-based compensation plans under which the Company has outstanding awards. The CBL & Associates Properties, Inc. 2012 Stock Incentive Plan ("the 2012 Plan") was approved by our shareholders in May 2012. The 2012 Plan permits the Company to issue stock options and common stock to selected officers, employees and non-employee directors of the Company up to a total of
10,400
shares. The CBL & Associates Properties, Inc. Second Amended and Restated Stock Incentive Plan ("the 1993 Plan"), which was approved by our shareholders in May 2003, will expire in May 2013 and no new grants will be issued. The Compensation Committee of the Board of Directors (the “Committee”) administers the plans.
The share-based compensation cost that was charged against income for the plan was
$3,704
,
$1,687
and
$2,201
for
2012
,
2011
and
2010
, respectively. Share-based compensation cost resulting from share-based awards is recorded at the Management Company, which is a taxable entity. The income tax effect resulting from share-based compensation of
$1,815
in 2010 has been reflected as a financing cash flow in the consolidated statements of cash flows. There was no income tax benefit in 2011. Share-based compensation cost capitalized as part of real estate assets was
$128
,
$166
and
$169
in
2012
,
2011
and
2010
, respectively.
Stock Options
Stock options issued under the plans allow for the purchase of common stock at the fair market value of the stock on the date of grant. Stock options granted to officers and employees vest and become exercisable in equal installments on each of the first five anniversaries of the date of grant and expire
10
years after the date of grant. Stock options granted to independent directors are fully vested upon grant; however, the independent directors may not sell, pledge or otherwise transfer their stock options during their board term or for
one
year thereafter. No stock options have been granted since 2002.
The Company’s stock option activity for the year ended
December 31, 2012
is summarized as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shares
|
|
Weighted
Average
Exercise
Price
|
|
Weighted
Average
Remaining
Contractual
Term
|
|
Aggregate
Intrinsic
Value
|
Outstanding at January 1, 2012
|
281,725
|
|
|
$
|
18.27
|
|
|
|
|
|
Cancelled
|
(15,375
|
)
|
|
$
|
18.27
|
|
|
|
|
|
Exercised
|
(266,350
|
)
|
|
$
|
18.27
|
|
|
|
|
|
Outstanding at December 31, 2012
|
—
|
|
|
$
|
—
|
|
|
0
|
|
$
|
—
|
|
Vested and exercisable at December 31, 2012
|
—
|
|
|
$
|
—
|
|
|
0
|
|
$
|
—
|
|
The total intrinsic value of options exercised during
2012
,
2011
and
2010
was
$177
,
$509
and
$346
, respectively.
Stock Awards
Under the plans, common stock may be awarded either alone, in addition to, or in tandem with other stock awards granted under the plans. The Committee has the authority to determine eligible persons to whom common stock will be awarded, the
number of shares to be awarded and the duration of the vesting period, as defined. Generally, an award of common stock vests either immediately at grant, in equal installments over a period of
five
years or in
one
installment at the end of periods up to
five
years. Stock awarded to independent directors is fully vested upon grant; however, the independent directors may not transfer such shares during their board term. The Committee may also provide for the issuance of common stock under the plans on a deferred basis pursuant to deferred compensation arrangements. The fair value of common stock awarded under the plans is determined based on the market price of the Company’s common stock on the grant date and the related compensation expense is recognized over the vesting period on a straight-line basis.
A summary of the status of the Company’s stock awards as of
December 31, 2012
, and changes during the year ended
December 31, 2012
, is presented below:
|
|
|
|
|
|
|
|
|
Shares
|
|
Weighted
Average
Grant-Date
Fair Value
|
Nonvested at January 1, 2012
|
289,290
|
|
|
$
|
16.09
|
|
Granted
|
295,465
|
|
|
$
|
19.09
|
|
Vested
|
(228,415
|
)
|
|
$
|
18.48
|
|
Forfeited
|
(9,480
|
)
|
|
$
|
16.64
|
|
Nonvested at December 31, 2012
|
346,860
|
|
|
$
|
17.06
|
|
The weighted average grant-date fair value of shares granted during
2012
,
2011
and
2010
was
$19.09
,
$17.48
and
$10.34
, respectively. The total fair value of shares vested during
2012
,
2011
and
2010
was
$4,573
,
$1,276
and
$914
, respectively.
As of
December 31, 2012
, there was
$3,325
of total unrecognized compensation cost related to nonvested stock awards granted under the plans, which is expected to be recognized over a weighted average period of
3.5
years. In February 2013, the Company granted
155,400
shares of restricted stock to its employees that will vest over the next
five
years.
NOTE 17. EMPLOYEE BENEFIT PLANS
401(k) Plan
The Management Company maintains a 401(k) profit sharing plan, which is qualified under Section 401(a) and Section 401(k) of the Code to cover employees of the Management Company. All employees who have attained the age of
21
and have completed at least
90 days
of service are eligible to participate in the plan. The plan provides for employer matching contributions on behalf of each participant equal to
50%
of the portion of such participant’s contribution that does not exceed
2.5%
of such participant’s compensation for the plan year. Additionally, the Management Company has the discretion to make additional profit-sharing-type contributions not related to participant elective contributions. Total contributions by the Management Company were
$929
,
$820
and
$957
in
2012
,
2011
and
2010
, respectively.
Employee Stock Purchase Plan
The Company maintains an employee stock purchase plan that allows eligible employees to acquire shares of the Company’s common stock in the open market without incurring brokerage or transaction fees. Under the plan, eligible employees make payroll deductions that are used to purchase shares of the Company’s common stock. The shares are purchased at the prevailing market price of the stock at the time of purchase.
Deferred Compensation Arrangements
The Company has entered into agreements with certain of its officers that allow the officers to defer receipt of selected salary increases and/or bonus compensation for periods ranging from
5
to
10
years. For certain officers, the deferred compensation arrangements provide that when the salary increase or bonus compensation is earned and deferred, shares of the Company’s common stock issuable under the Amended and Restated Stock Incentive Plan are deemed set aside for the amount deferred. The number of shares deemed set aside is determined by dividing the amount of compensation deferred by the fair value of the Company’s common stock on the deferral date, as defined in the arrangements. The shares set aside are deemed to receive dividends equivalent to those paid on the Company’s common stock, which are then deemed to be reinvested in the Company’s common stock in accordance with the Company’s dividend reinvestment plan. When an arrangement terminates, the Company will issue shares of the Company’s common stock to the officer equivalent to the number of shares deemed to have accumulated under the
officer’s arrangement. The Company accrues compensation expense related to these agreements as the compensation is earned during the term of the agreement.
At
December 31, 2012
and
2011
, there were
0
and
68,906
shares, respectively, that were deemed set aside in accordance with these arrangements.
For other officers, the deferred compensation arrangements provide that their bonus compensation is deferred in the form of a note payable to the officer. Interest accumulates on these notes at
5.0%
. When an arrangement terminates, the note payable plus accrued interest is paid to the officer in cash. At
December 31, 2012
and
2011
, the Company had notes payable, including accrued interest, of
$124
and
$81
, respectively, related to these arrangements.
NOTE 18. OPERATING PARTNERSHIP
The Company presents the condensed consolidated financial statements of the Operating Partnership since substantially all of the Company’s business is conducted through it and, therefore, it reflects the financial position and performance of the Company’s Properties in absolute terms regardless of the ownership interests of the Company’s common shareholders and the noncontrolling interest in the Operating Partnership. These statements are provided for informational purposes only and their disclosure is not required.
The condensed consolidated financial statement information for the Operating Partnership is presented as follows:
|
|
|
|
|
|
|
|
|
|
December 31,
|
|
2012
|
|
2011
|
ASSETS:
|
|
|
|
Net investment in real estate assets
|
$
|
6,328,982
|
|
|
$
|
6,005,670
|
|
Other assets
|
761,243
|
|
|
713,889
|
|
Total assets
|
$
|
7,090,225
|
|
|
$
|
6,719,559
|
|
LIABILITIES:
|
|
|
|
|
|
Mortgage and other indebtedness
|
$
|
4,745,683
|
|
|
$
|
4,489,355
|
|
Other liabilities
|
358,800
|
|
|
303,578
|
|
Total liabilities
|
5,104,483
|
|
|
4,792,933
|
|
Redeemable noncontrolling interests
|
465,596
|
|
|
456,105
|
|
|
|
|
|
Partners’ capital
|
1,456,650
|
|
|
1,466,241
|
|
Noncontrolling interests
|
63,496
|
|
|
4,280
|
|
Total partners’ capital and noncontrolling interests
|
1,520,146
|
|
|
1,470,521
|
|
Total liabilities, redeemable noncontrolling interests, partners’ capital and noncontrolling interests
|
$
|
7,090,225
|
|
|
$
|
6,719,559
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year Ended December 31,
|
|
2012
|
|
2011
|
|
2010
|
Total revenues
|
$
|
1,034,640
|
|
|
$
|
1,051,314
|
|
|
$
|
1,045,703
|
|
Depreciation and amortization
|
(265,856
|
)
|
|
(271,458
|
)
|
|
(280,575
|
)
|
Other operating expenses
|
(389,615
|
)
|
|
(421,137
|
)
|
|
(363,611
|
)
|
Income from operations
|
379,169
|
|
|
358,719
|
|
|
401,517
|
|
Interest and other income
|
3,955
|
|
|
2,583
|
|
|
3,869
|
|
Interest expense
|
(244,432
|
)
|
|
(267,072
|
)
|
|
(281,101
|
)
|
Gain on extinguishment of debt
|
265
|
|
|
1,029
|
|
|
—
|
|
Gain on investments
|
45,072
|
|
|
—
|
|
|
888
|
|
Gain on sales of real estate assets
|
2,286
|
|
|
59,396
|
|
|
2,887
|
|
Equity in earnings (losses) of unconsolidated affiliates
|
8,313
|
|
|
6,138
|
|
|
(188
|
)
|
Income tax benefit (provision)
|
(1,404
|
)
|
|
269
|
|
|
6,417
|
|
Income from continuing operations
|
193,224
|
|
|
161,062
|
|
|
134,289
|
|
Operating income (loss) of discontinued operations
|
(19,643
|
)
|
|
23,933
|
|
|
(36,456
|
)
|
Gain (loss) on discontinued operations
|
938
|
|
|
(1
|
)
|
|
379
|
|
Net income
|
174,519
|
|
|
184,994
|
|
|
98,212
|
|
Noncontrolling interest in earnings of other consolidated subsidiaries
|
(23,652
|
)
|
|
(25,217
|
)
|
|
(25,001
|
)
|
Net income attributable to partners of the operating partnership
|
$
|
150,867
|
|
|
$
|
159,777
|
|
|
$
|
73,211
|
|
NOTE 19. QUARTERLY INFORMATION (UNAUDITED)
The following quarterly information differs from previously reported amounts due to the reclassifications of the results of operations of certain long-lived assets to discontinued operations for all periods presented. See
Note 4
for further information.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year Ended December 31, 2012
|
First
Quarter
|
|
Second
Quarter
|
|
Third
Quarter
|
|
Fourth
Quarter
|
|
Total
(1)
|
Total revenues
|
$
|
246,829
|
|
|
$
|
252,326
|
|
|
$
|
257,135
|
|
|
$
|
278,350
|
|
|
$
|
1,034,640
|
|
Income from operations
(2)
|
91,790
|
|
|
94,560
|
|
|
96,786
|
|
|
96,033
|
|
|
379,169
|
|
Income from continuing operations
(3)
|
34,622
|
|
|
36,260
|
|
|
37,879
|
|
|
84,463
|
|
|
193,224
|
|
Discontinued operations
|
1,929
|
|
|
3,133
|
|
|
(25,387
|
)
|
|
1,620
|
|
|
(18,705
|
)
|
Net income
|
36,551
|
|
|
39,393
|
|
|
12,492
|
|
|
86,083
|
|
|
174,519
|
|
Net income attributable to the Company
|
26,049
|
|
|
29,391
|
|
|
8,074
|
|
|
68,086
|
|
|
131,600
|
|
Net income (loss) attributable to common shareholders
|
15,455
|
|
|
18,797
|
|
|
(2,520
|
)
|
|
52,357
|
|
|
84,089
|
|
Basic per share data attributable to common shareholders:
|
|
|
|
|
|
|
|
|
|
|
|
|
Income from continuing operations, net of preferred dividends
|
$
|
0.09
|
|
|
$
|
0.11
|
|
|
$
|
0.12
|
|
|
$
|
0.32
|
|
|
$
|
0.64
|
|
Net income (loss) attributable to common shareholders
|
$
|
0.10
|
|
|
$
|
0.12
|
|
|
$
|
(0.02
|
)
|
|
$
|
0.33
|
|
|
$
|
0.54
|
|
Diluted per share data attributable to common shareholders:
|
|
|
|
|
|
|
|
|
|
|
|
|
Income from continuing operations, net of preferred dividends
|
$
|
0.09
|
|
|
$
|
0.11
|
|
|
$
|
0.12
|
|
|
$
|
0.32
|
|
|
$
|
0.64
|
|
Net income (loss) attributable to common shareholders
|
$
|
0.10
|
|
|
$
|
0.12
|
|
|
$
|
(0.02
|
)
|
|
$
|
0.33
|
|
|
$
|
0.54
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year Ended December 31, 2011
|
First
Quarter
|
|
Second
Quarter
|
|
Third
Quarter
|
|
Fourth
Quarter
|
|
Total
(1)
|
Total revenues
|
$
|
263,049
|
|
|
$
|
258,378
|
|
|
$
|
265,044
|
|
|
$
|
264,843
|
|
|
$
|
1,051,314
|
|
Income from operations
(4)
|
98,016
|
|
|
96,092
|
|
|
51,273
|
|
|
113,338
|
|
|
358,719
|
|
Income (loss) from continuing operations
(5)
|
36,366
|
|
|
32,864
|
|
|
(18,483
|
)
|
|
110,315
|
|
|
161,062
|
|
Discontinued operations
|
27,542
|
|
|
(3,332
|
)
|
|
163
|
|
|
(441
|
)
|
|
23,932
|
|
Net income (loss)
|
63,908
|
|
|
29,532
|
|
|
(18,320
|
)
|
|
109,874
|
|
|
184,994
|
|
Net income (loss) attributable to the Company
|
47,319
|
|
|
20,376
|
|
|
(16,726
|
)
|
|
82,967
|
|
|
133,936
|
|
Net income (loss) attributable to common shareholders
|
36,725
|
|
|
9,782
|
|
|
(27,320
|
)
|
|
72,373
|
|
|
91,560
|
|
Basic per share data attributable to common shareholders:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) from continuing operations, net of preferred dividends
|
$
|
0.10
|
|
|
$
|
0.08
|
|
|
$
|
(0.18
|
)
|
|
$
|
0.49
|
|
|
$
|
0.49
|
|
Net income (loss) attributable to common shareholders
|
$
|
0.25
|
|
|
$
|
0.07
|
|
|
$
|
(0.18
|
)
|
|
$
|
0.49
|
|
|
$
|
0.62
|
|
Diluted per share data attributable to common shareholders:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) from continuing operations, net of preferred dividends
|
$
|
0.10
|
|
|
$
|
0.08
|
|
|
$
|
(0.18
|
)
|
|
$
|
0.49
|
|
|
$
|
0.49
|
|
Net income (loss) attributable to common shareholders
|
$
|
0.25
|
|
|
$
|
0.07
|
|
|
$
|
(0.18
|
)
|
|
$
|
0.49
|
|
|
$
|
0.62
|
|
|
|
(1)
|
The sum of quarterly earnings per share may differ from annual earnings per share due to rounding.
|
|
|
(2)
|
Income from operations for the quarter ended December 31, 2012 includes a loss on impairment of real estate assets of
$20,315
to write down the book value of vacant land available for expansion (see
Note 15
).
|
|
|
(3)
|
Income from continuing operations for the quarter ended December 31, 2012 includes a
$45,072
gain on investment related to the Company's acquisition of a joint venture partner's interest in one Property (see
Note 3
).
|
|
|
(4)
|
Income from operations for the quarter ended September 30, 2011 includes a
$50,683
loss on impairment of real estate related to one Mall (see
Note 15
).
|
|
|
(5)
|
Income from continuing operations for the quarter ended December 31, 2011 includes a
$54,327
gain on sale of real estate for the sale of a partial interest in several Properties as part of the CBL/T-C joint venture (see
Note 5
).
|
NOTE 20. SUBSEQUENT EVENTS
On February 22, 2013, the Company closed on an amended and restated agreement of its
$105,000
secured credit facility with First Tennessee Bank, NA. The facility was converted from secured to unsecured with a capacity of
$100,000
and a maturity date of
February 2016
. Amounts outstanding bear interest at an annual rate equal to one-month LIBOR plus a spread of
155
to
210
basis points, depending on the Company's leverage ratio. Under the terms of the agreement, the Company also obtained a
$50,000
unsecured term loan that bears interest at LIBOR plus
190
basis points and matures in
February 2018
. The
$100,000
facility also provides that in the event the Company obtains an investment grade rating, it may make a one-time irrevocable election to use its credit rating to determine the interest rate on the facility. If the Company were to make such an election, the facility would bear interest at an annual rate equal to LIBOR plus a spread of
100
to
175
basis points.
In February 2013, Woodstock GA Investments, LLC, a joint venture in which the Company owns a
75.0%
interest, received
$3,525
of the balance on its
$6,581
note receivable.
In February 2013, the Company retired an operating property loan with a principal balance of
$13,482
outstanding as of
December 31, 2012
with borrowings from its secured credit facility. The loan was secured by Statesboro Crossing in Statesboro, GA.
In January 2013, the Company sold its Lake Point and Suntrust Bank office buildings, located in Greensboro, NC, for a gross sales price of
$30,875
. Net proceeds from the sale were used to reduce outstanding balances under the Company's credit facilities. As described in
Note 4
, these office buildings were classified as held for sale as of December 31, 2012.
In January 2013, the Company retired an operating property loan with a principal balance of
$63,639
outstanding as of
December 31, 2012
with borrowings from its unsecured credit facilities. The loan was secured by Westmoreland Mall in Greensburg, PA.
In January 2013, TIF bonds, received in a private placement as consideration for infrastructure improvements made by the Company related to the development of a community center, were redeemed for
$12,000
. The Company adjusted the value of the bonds to their net realizable value as of
December 31, 2012
.
Subsequent to December 31, 2012, the Company and Jinsheng amended the secured note to extend the maturity date until
May 2013
. Furthermore, the secured note will bear interest of
8.0%
until the extended maturity date and, if not paid prior to or on the maturity date, will thereafter bear interest at
30.0%
.
Schedule II
CBL & Associates Properties, Inc.
Valuation and Qualifying Accounts
(In thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year Ended December 31,
|
|
2012
|
|
2011
|
|
2010
|
Tenant receivables - allowance for doubtful accounts:
|
|
|
|
|
|
Balance, beginning of year
|
$
|
1,760
|
|
|
$
|
3,167
|
|
|
$
|
3,101
|
|
Additions in allowance charged to expense
|
1,523
|
|
|
1,682
|
|
|
2,726
|
|
Transfer to other receivables - allowance
|
—
|
|
|
(1,400
|
)
|
|
—
|
|
Bad debts charged against allowance
|
(1,306
|
)
|
|
(1,689
|
)
|
|
(2,660
|
)
|
Balance, end of year
|
$
|
1,977
|
|
|
$
|
1,760
|
|
|
$
|
3,167
|
|
|
|
|
|
|
|
|
Year Ended December 31,
|
|
2012
|
|
2011
|
|
2010
|
Other receivables - allowance for doubtful accounts:
|
|
|
|
|
|
Balance, beginning of year
|
$
|
1,400
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Transfer from tenant receivables - allowance
|
—
|
|
|
1,400
|
|
|
—
|
|
Bad debts charged against allowance
|
(130
|
)
|
|
—
|
|
|
—
|
|
Balance, end of year
|
$
|
1,270
|
|
|
$
|
1,400
|
|
|
$
|
—
|
|
SCHEDULE III
CBL & ASSOCIATES PROPERTIES, INC.
REAL ESTATE ASSETS AND ACCUMULATED DEPRECIATION
At December 31, 2012
(In thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Initial Cost(A)
|
|
|
|
|
|
Gross Amounts at Which Carried at Close of Period
|
|
|
Description /Location
|
|
Encumbrances
(B)
|
|
Land
|
|
Buildings and Improvements
|
|
Costs
Capitalized Subsequent to Acquisition
|
|
Sales of Outparcel
Land
|
|
Land
|
|
Buildings and Improvements
|
|
Total (C)
|
|
Accumulated Depreciation (D)
|
|
Date of Construction
/ Acquisition
|
MALLS:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Acadiana Mall, Lafayette, LA
|
|
$
|
137,640
|
|
|
$
|
22,511
|
|
|
$
|
145,769
|
|
|
$
|
7,405
|
|
|
$
|
—
|
|
|
$
|
22,511
|
|
|
$
|
153,174
|
|
|
$
|
175,685
|
|
|
$
|
(51,476
|
)
|
|
2005
|
Alamance Crossing, Burlington, NC
|
|
66,001
|
|
|
20,853
|
|
|
62,799
|
|
|
39,269
|
|
|
(2,112
|
)
|
|
18,741
|
|
|
102,068
|
|
|
120,809
|
|
|
(16,494
|
)
|
|
2007
|
Arbor Place, Douglasville, GA
|
|
121,050
|
|
|
7,862
|
|
|
95,330
|
|
|
23,109
|
|
|
—
|
|
|
7,862
|
|
|
118,439
|
|
|
126,301
|
|
|
(44,988
|
)
|
|
1998-1999
|
Asheville Mall, Asheville, NC
|
|
76,289
|
|
|
7,139
|
|
|
58,747
|
|
|
48,330
|
|
|
(805
|
)
|
|
6,334
|
|
|
107,077
|
|
|
113,411
|
|
|
(38,244
|
)
|
|
1998
|
Bonita Lakes Mall, Meridian, MS
|
|
—
|
|
|
4,924
|
|
|
31,933
|
|
|
6,664
|
|
|
(985
|
)
|
|
4,924
|
|
|
37,612
|
|
|
42,536
|
|
|
(15,423
|
)
|
|
1997
|
Brookfield Square, Brookfield, WI
|
|
92,305
|
|
|
8,996
|
|
|
84,250
|
|
|
43,545
|
|
|
(18
|
)
|
|
9,170
|
|
|
127,603
|
|
|
136,773
|
|
|
(40,394
|
)
|
|
2001
|
Burnsville Center, Burnsville, MN
|
|
79,272
|
|
|
12,804
|
|
|
71,355
|
|
|
51,092
|
|
|
(1,157
|
)
|
|
16,102
|
|
|
117,992
|
|
|
134,094
|
|
|
(41,016
|
)
|
|
1998
|
Cary Towne Center, Cary, NC
|
|
55,910
|
|
|
23,688
|
|
|
74,432
|
|
|
23,708
|
|
|
—
|
|
|
23,701
|
|
|
98,127
|
|
|
121,828
|
|
|
(30,788
|
)
|
|
2001
|
Chapel Hill Mall, Akron, OH
|
|
70,045
|
|
|
6,578
|
|
|
68,043
|
|
|
13,651
|
|
|
—
|
|
|
6,578
|
|
|
81,694
|
|
|
88,272
|
|
|
(19,784
|
)
|
|
2004
|
CherryVale Mall, Rockford, IL
|
|
82,347
|
|
|
11,892
|
|
|
63,973
|
|
|
50,569
|
|
|
(1,667
|
)
|
|
11,608
|
|
|
113,159
|
|
|
124,767
|
|
|
(32,331
|
)
|
|
2001
|
Chesterfield Mall, Chesterfield, MO
|
|
139,022
|
|
|
11,083
|
|
|
282,140
|
|
|
1,915
|
|
|
—
|
|
|
11,083
|
|
|
284,055
|
|
|
295,138
|
|
|
(49,464
|
)
|
|
2007
|
Citadel Mall, Charleston, SC
|
|
68,835
|
|
|
10,990
|
|
|
44,008
|
|
|
7,247
|
|
|
(1,289
|
)
|
|
10,154
|
|
|
50,802
|
|
|
60,956
|
|
|
(16,629
|
)
|
|
2001
|
College Square, Morristown, TN (E)
|
|
—
|
|
|
2,954
|
|
|
17,787
|
|
|
22,836
|
|
|
(88
|
)
|
|
2,866
|
|
|
40,623
|
|
|
43,489
|
|
|
(17,775
|
)
|
|
1987-1988
|
Columbia Place, Columbia, SC
|
|
27,265
|
|
|
1,526
|
|
|
52,348
|
|
|
(47,222
|
)
|
|
(423
|
)
|
|
1,103
|
|
|
5,126
|
|
|
6,229
|
|
|
(261
|
)
|
|
2002
|
Cross Creek Mall, Fayetteville, NC
|
|
137,179
|
|
|
19,155
|
|
|
104,353
|
|
|
14,656
|
|
|
—
|
|
|
19,155
|
|
|
119,009
|
|
|
138,164
|
|
|
(27,877
|
)
|
|
2003
|
Dakota Square Mall, Minot, ND
|
|
61,193
|
|
|
4,552
|
|
|
87,625
|
|
|
178
|
|
|
—
|
|
|
4,552
|
|
|
87,803
|
|
|
92,355
|
|
|
(1,650
|
)
|
|
2012
|
Eastland Mall, Bloomington, IL
|
|
59,400
|
|
|
5,746
|
|
|
75,893
|
|
|
6,582
|
|
|
(753
|
)
|
|
5,304
|
|
|
82,163
|
|
|
87,467
|
|
|
(21,671
|
)
|
|
2005
|
East Towne Mall, Madison, WI
|
|
70,220
|
|
|
4,496
|
|
|
63,867
|
|
|
41,145
|
|
|
(366
|
)
|
|
4,130
|
|
|
105,012
|
|
|
109,142
|
|
|
(32,039
|
)
|
|
2002
|
EastGate Mall , Cincinnati, OH
|
|
42,281
|
|
|
13,046
|
|
|
44,949
|
|
|
26,233
|
|
|
(879
|
)
|
|
12,167
|
|
|
71,182
|
|
|
83,349
|
|
|
(22,049
|
)
|
|
2001
|
Fashion Square, Saginaw, MI
|
|
41,569
|
|
|
15,218
|
|
|
64,970
|
|
|
10,102
|
|
|
—
|
|
|
15,218
|
|
|
75,072
|
|
|
90,290
|
|
|
(23,967
|
)
|
|
2001
|
Fayette Mall, Lexington, KY
|
|
179,227
|
|
|
20,707
|
|
|
84,267
|
|
|
46,326
|
|
|
11
|
|
|
20,718
|
|
|
130,593
|
|
|
151,311
|
|
|
(37,644
|
)
|
|
2001
|
Frontier Mall , Cheyenne, WY
|
|
—
|
|
|
2,681
|
|
|
15,858
|
|
|
18,217
|
|
|
—
|
|
|
2,681
|
|
|
34,075
|
|
|
36,756
|
|
|
(17,508
|
)
|
|
1984-1985
|
Foothills Mall, Maryville, TN (E)
|
|
—
|
|
|
5,558
|
|
|
22,594
|
|
|
11,284
|
|
|
—
|
|
|
5,558
|
|
|
33,878
|
|
|
39,436
|
|
|
(18,589
|
)
|
|
1996
|
Georgia Square, Athens, GA
|
|
—
|
|
|
2,982
|
|
|
31,071
|
|
|
30,879
|
|
|
(31
|
)
|
|
2,951
|
|
|
61,950
|
|
|
64,901
|
|
|
(38,819
|
)
|
|
1982
|
Greenbrier Mall, Chesapeake, VA
|
|
77,085
|
|
|
3,181
|
|
|
107,355
|
|
|
8,300
|
|
|
(626
|
)
|
|
2,555
|
|
|
115,655
|
|
|
118,210
|
|
|
(26,643
|
)
|
|
2004
|
Hamilton Place, Chattanooga, TN
|
|
106,024
|
|
|
2,422
|
|
|
40,757
|
|
|
39,214
|
|
|
(441
|
)
|
|
1,981
|
|
|
79,971
|
|
|
81,952
|
|
|
(37,889
|
)
|
|
1986-1987
|
Hanes Mall, Winston-Salem, NC
|
|
156,208
|
|
|
17,176
|
|
|
133,376
|
|
|
44,343
|
|
|
(948
|
)
|
|
16,808
|
|
|
177,139
|
|
|
193,947
|
|
|
(52,168
|
)
|
|
2001
|
Harford Mall , Bel Air, MD
|
|
—
|
|
|
8,699
|
|
|
45,704
|
|
|
21,140
|
|
|
—
|
|
|
8,699
|
|
|
66,844
|
|
|
75,543
|
|
|
(16,776
|
)
|
|
2003
|
Hickory Point, (Forsyth) Decatur, IL
|
|
29,635
|
|
|
10,732
|
|
|
31,728
|
|
|
11,283
|
|
|
(293
|
)
|
|
10,440
|
|
|
43,010
|
|
|
53,450
|
|
|
(12,780
|
)
|
|
2005
|
Honey Creek Mall, Terre Haute, IN
|
|
30,921
|
|
|
3,108
|
|
|
83,358
|
|
|
9,229
|
|
|
—
|
|
|
3,108
|
|
|
92,587
|
|
|
95,695
|
|
|
(21,935
|
)
|
|
2004
|
Imperial Valley Mall, El Centro, CA
|
|
54,169
|
|
|
35,378
|
|
|
70,549
|
|
|
|
|
—
|
|
|
35,378
|
|
|
70,549
|
|
|
105,927
|
|
|
—
|
|
|
2012
|
JC Penney Store, Maryville, TN (E)
|
|
—
|
|
|
—
|
|
|
2,650
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,650
|
|
|
2,650
|
|
|
(1,877
|
)
|
|
1983
|
Janesville Mall, Janesville, WI
|
|
5,269
|
|
|
8,074
|
|
|
26,009
|
|
|
7,991
|
|
|
—
|
|
|
8,074
|
|
|
34,000
|
|
|
42,074
|
|
|
(12,430
|
)
|
|
1998
|
Jefferson Mall, Louisville, KY
|
|
70,676
|
|
|
13,125
|
|
|
40,234
|
|
|
21,657
|
|
|
(521
|
)
|
|
12,604
|
|
|
61,891
|
|
|
74,495
|
|
|
(19,169
|
)
|
|
2001
|
SCHEDULE III
CBL & ASSOCIATES PROPERTIES, INC.
REAL ESTATE ASSETS AND ACCUMULATED DEPRECIATION
At December 31, 2012
(In thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Initial Cost(A)
|
|
|
|
|
|
Gross Amounts at Which Carried at Close of Period
|
|
|
Description /Location
|
|
Encumbrances
(B)
|
|
Land
|
|
Buildings and Improvements
|
|
Costs
Capitalized Subsequent to Acquisition
|
|
Sales of Outparcel
Land
|
|
Land
|
|
Buildings and Improvements
|
|
Total (C)
|
|
Accumulated Depreciation (D)
|
|
Date of Construction
/ Acquisition
|
Kirkwood Mall , Bismarck ND
|
|
43,338
|
|
|
3,368
|
|
|
118,945
|
|
|
83
|
|
|
—
|
|
|
3,368
|
|
|
119,028
|
|
|
122,396
|
|
|
—
|
|
|
2012
|
The Lakes Mall, Muskegon, MI (E)
|
|
—
|
|
|
3,328
|
|
|
42,366
|
|
|
10,031
|
|
|
—
|
|
|
3,328
|
|
|
52,397
|
|
|
55,725
|
|
|
(20,188
|
)
|
|
2000-2001
|
Lakeshore Mall, Sebring, FL
|
|
—
|
|
|
1,443
|
|
|
28,819
|
|
|
6,409
|
|
|
(169
|
)
|
|
1,274
|
|
|
35,228
|
|
|
36,502
|
|
|
(17,164
|
)
|
|
1991-1992
|
Laurel Park, Livonia, MI
|
|
—
|
|
|
13,289
|
|
|
92,579
|
|
|
9,366
|
|
|
—
|
|
|
13,289
|
|
|
101,945
|
|
|
115,234
|
|
|
(28,811
|
)
|
|
2005
|
Layton Hills Mall, Layton, UT
|
|
98,369
|
|
|
20,464
|
|
|
99,836
|
|
|
12,790
|
|
|
(275
|
)
|
|
20,189
|
|
|
112,626
|
|
|
132,815
|
|
|
(28,625
|
)
|
|
2005
|
Summit Fair Land, Lee's Summit, MO
|
|
—
|
|
|
10,992
|
|
|
|
|
315
|
|
|
—
|
|
|
10,992
|
|
|
315
|
|
|
11,307
|
|
|
—
|
|
|
2010
|
Madison Square, Huntsville, AL
|
|
—
|
|
|
17,596
|
|
|
39,186
|
|
|
19,059
|
|
|
—
|
|
|
17,596
|
|
|
58,245
|
|
|
75,841
|
|
|
(18,820
|
)
|
|
1984
|
Mall del Norte, Laredo, TX (F)
|
|
113,400
|
|
|
21,734
|
|
|
142,049
|
|
|
49,115
|
|
|
—
|
|
|
21,734
|
|
|
191,164
|
|
|
212,898
|
|
|
(52,079
|
)
|
|
2004
|
Meridian Mall , Lansing, MI
|
|
—
|
|
|
529
|
|
|
103,678
|
|
|
64,044
|
|
|
—
|
|
|
2,232
|
|
|
166,019
|
|
|
168,251
|
|
|
(60,818
|
)
|
|
1998
|
Midland Mall, Midland, MI
|
|
34,568
|
|
|
10,321
|
|
|
29,429
|
|
|
8,499
|
|
|
—
|
|
|
10,321
|
|
|
37,928
|
|
|
48,249
|
|
|
(13,406
|
)
|
|
2001
|
Mid Rivers Mall, St. Peters, MO
|
|
89,312
|
|
|
16,384
|
|
|
170,582
|
|
|
7,453
|
|
|
—
|
|
|
16,384
|
|
|
178,035
|
|
|
194,419
|
|
|
(32,320
|
)
|
|
2007
|
Monroeville Mall, Pittsburgh, PA
|
|
—
|
|
|
22,195
|
|
|
177,214
|
|
|
43,169
|
|
|
—
|
|
|
24,716
|
|
|
217,862
|
|
|
242,578
|
|
|
(49,668
|
)
|
|
2004
|
Northgate Mall, Chattanooga, TN
|
|
—
|
|
|
2,330
|
|
|
8,960
|
|
|
(1,031
|
)
|
|
—
|
|
|
2,330
|
|
|
7,929
|
|
|
10,259
|
|
|
(745
|
)
|
|
2011
|
Northpark Mall, Joplin, MO
|
|
33,897
|
|
|
9,977
|
|
|
65,481
|
|
|
32,818
|
|
|
—
|
|
|
10,962
|
|
|
97,314
|
|
|
108,276
|
|
|
(26,390
|
)
|
|
2004
|
Northwoods Mall, Charleston, SC
|
|
72,339
|
|
|
14,867
|
|
|
49,647
|
|
|
16,990
|
|
|
(2,339
|
)
|
|
12,528
|
|
|
66,637
|
|
|
79,165
|
|
|
(20,917
|
)
|
|
2001
|
Oak Hollow Mall Barnes & Noble, High Point, NC
|
|
—
|
|
|
893
|
|
|
1,870
|
|
|
—
|
|
|
—
|
|
|
893
|
|
|
1,870
|
|
|
2,763
|
|
|
(1,582
|
)
|
|
1994-1995
|
Old Hickory Mall, Jackson, TN
|
|
—
|
|
|
15,527
|
|
|
29,413
|
|
|
5,788
|
|
|
—
|
|
|
15,527
|
|
|
35,201
|
|
|
50,728
|
|
|
(11,731
|
)
|
|
2001
|
The Outlet Shoppes at El Paso, El Paso, TX
|
|
73,118
|
|
|
9,165
|
|
|
96,640
|
|
|
379
|
|
|
—
|
|
|
9,165
|
|
|
97,019
|
|
|
106,184
|
|
|
(3,320
|
)
|
|
2012
|
The Outlet Shoppes at Gettysburg, Gettysburg, PA
|
|
40,170
|
|
|
20,940
|
|
|
22,180
|
|
|
480
|
|
|
—
|
|
|
20,940
|
|
|
22,660
|
|
|
43,600
|
|
|
(1,185
|
)
|
|
2012
|
The Outlet Shoppes at Oklahoma City, Oklahoma City, OK
|
|
58,888
|
|
|
8,365
|
|
|
50,268
|
|
|
9,077
|
|
|
—
|
|
|
8,369
|
|
|
59,341
|
|
|
67,710
|
|
|
(5,338
|
)
|
|
2011
|
Panama City Mall, Panama City, FL
|
|
—
|
|
|
9,017
|
|
|
37,454
|
|
|
20,055
|
|
|
—
|
|
|
12,168
|
|
|
54,358
|
|
|
66,526
|
|
|
(14,977
|
)
|
|
2002
|
Parkdale Mall, Beaumont, TX
|
|
91,906
|
|
|
23,850
|
|
|
47,390
|
|
|
46,305
|
|
|
(307
|
)
|
|
23,543
|
|
|
93,695
|
|
|
117,238
|
|
|
(26,671
|
)
|
|
2001
|
Park Plaza Mall, Little Rock, AR
|
|
96,059
|
|
|
6,297
|
|
|
81,638
|
|
|
34,658
|
|
|
—
|
|
|
6,304
|
|
|
116,289
|
|
|
122,593
|
|
|
(34,478
|
)
|
|
2004
|
Parkway Place Mall, Huntsville, AL
|
|
40,244
|
|
|
6,364
|
|
|
67,067
|
|
|
912
|
|
|
—
|
|
|
6,364
|
|
|
67,979
|
|
|
74,343
|
|
|
(6,352
|
)
|
|
2010
|
Pearland Town Center, Pearland, TX
|
|
18,264
|
|
|
16,300
|
|
|
108,615
|
|
|
10,657
|
|
|
(366
|
)
|
|
15,443
|
|
|
119,763
|
|
|
135,206
|
|
|
(21,425
|
)
|
|
2008
|
Post Oak Mall, College Station, TX
|
|
—
|
|
|
3,936
|
|
|
48,948
|
|
|
10,563
|
|
|
(327
|
)
|
|
3,608
|
|
|
59,512
|
|
|
63,120
|
|
|
(24,316
|
)
|
|
1984-1985
|
Randolph Mall, Asheboro, NC
|
|
—
|
|
|
4,547
|
|
|
13,927
|
|
|
8,015
|
|
|
—
|
|
|
4,547
|
|
|
21,942
|
|
|
26,489
|
|
|
(7,188
|
)
|
|
2001
|
Regency Mall, Racine, WI
|
|
—
|
|
|
3,384
|
|
|
36,839
|
|
|
14,979
|
|
|
—
|
|
|
4,244
|
|
|
50,958
|
|
|
55,202
|
|
|
(16,694
|
)
|
|
2001
|
Richland Mall, Waco, TX
|
|
—
|
|
|
9,874
|
|
|
34,793
|
|
|
8,981
|
|
|
—
|
|
|
9,887
|
|
|
43,760
|
|
|
53,647
|
|
|
(13,063
|
)
|
|
2002
|
RiverGate Mall, Nashville, TN
|
|
—
|
|
|
17,896
|
|
|
86,767
|
|
|
25,328
|
|
|
—
|
|
|
17,896
|
|
|
112,095
|
|
|
129,991
|
|
|
(41,150
|
)
|
|
1998
|
River Ridge Mall, Lynchburg, VA
|
|
—
|
|
|
4,824
|
|
|
59,052
|
|
|
9,830
|
|
|
(94
|
)
|
|
4,731
|
|
|
68,881
|
|
|
73,612
|
|
|
(13,219
|
)
|
|
2003
|
South County Center, Mehlville, MO
|
|
71,928
|
|
|
15,754
|
|
|
159,249
|
|
|
3,387
|
|
|
—
|
|
|
15,754
|
|
|
162,636
|
|
|
178,390
|
|
|
(29,044
|
)
|
|
2007
|
Southaven Towne Ctr, Southaven, MS
|
|
41,786
|
|
|
8,255
|
|
|
29,380
|
|
|
9,258
|
|
|
—
|
|
|
8,159
|
|
|
38,734
|
|
|
46,893
|
|
|
(10,967
|
)
|
|
2005
|
Southpark Mall, Colonial Heights, VA
|
|
66,525
|
|
|
9,501
|
|
|
73,262
|
|
|
24,577
|
|
|
—
|
|
|
9,503
|
|
|
97,837
|
|
|
107,340
|
|
|
(24,701
|
)
|
|
2003
|
Stroud Mall, Stroudsburg, PA
|
|
34,469
|
|
|
14,711
|
|
|
23,936
|
|
|
20,320
|
|
|
—
|
|
|
14,711
|
|
|
44,256
|
|
|
58,967
|
|
|
(13,345
|
)
|
|
1998
|
SCHEDULE III
CBL & ASSOCIATES PROPERTIES, INC.
REAL ESTATE ASSETS AND ACCUMULATED DEPRECIATION
At December 31, 2012
(In thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Initial Cost(A)
|
|
|
|
|
|
Gross Amounts at Which Carried at Close of Period
|
|
|
Description /Location
|
|
Encumbrances
(B)
|
|
Land
|
|
Buildings and Improvements
|
|
Costs
Capitalized Subsequent to Acquisition
|
|
Sales of Outparcel
Land
|
|
Land
|
|
Buildings and Improvements
|
|
Total (C)
|
|
Accumulated Depreciation (D)
|
|
Date of Construction
/ Acquisition
|
St. Clair Square, Fairview Heights, IL
|
|
123,875
|
|
|
11,027
|
|
|
75,620
|
|
|
32,001
|
|
|
—
|
|
|
11,027
|
|
|
107,621
|
|
|
118,648
|
|
|
(40,050
|
)
|
|
1996
|
Sunrise Mall, Brownsville, TX
|
|
—
|
|
|
11,156
|
|
|
59,047
|
|
|
5,915
|
|
|
—
|
|
|
11,156
|
|
|
64,962
|
|
|
76,118
|
|
|
(23,065
|
)
|
|
2003
|
Turtle Creek Mall , Hattiesburg, MS
|
|
—
|
|
|
2,345
|
|
|
26,418
|
|
|
18,281
|
|
|
—
|
|
|
3,535
|
|
|
43,509
|
|
|
47,044
|
|
|
(18,221
|
)
|
|
1993-1995
|
Valley View, Roanoke, VA
|
|
62,282
|
|
|
15,985
|
|
|
77,771
|
|
|
17,715
|
|
|
—
|
|
|
15,999
|
|
|
95,472
|
|
|
111,471
|
|
|
(22,555
|
)
|
|
2003
|
Volusia Mall, Daytona, FL
|
|
53,191
|
|
|
2,526
|
|
|
120,242
|
|
|
10,601
|
|
|
—
|
|
|
2,526
|
|
|
130,843
|
|
|
133,369
|
|
|
(29,086
|
)
|
|
2004
|
Walnut Square, Dalton, GA (E)
|
|
—
|
|
|
50
|
|
|
15,138
|
|
|
16,746
|
|
|
—
|
|
|
50
|
|
|
31,884
|
|
|
31,934
|
|
|
(16,181
|
)
|
|
1984-1985
|
Wausau Center, Wausau, WI
|
|
19,187
|
|
|
5,231
|
|
|
24,705
|
|
|
16,775
|
|
|
(5,231
|
)
|
|
—
|
|
|
41,480
|
|
|
41,480
|
|
|
(14,766
|
)
|
|
2001
|
West Towne Mall, Madison, WI
|
|
99,185
|
|
|
9,545
|
|
|
83,084
|
|
|
39,418
|
|
|
—
|
|
|
9,545
|
|
|
122,502
|
|
|
132,047
|
|
|
(37,093
|
)
|
|
2002
|
Westgate Mall, Spartanburg, SC
|
|
39,661
|
|
|
2,149
|
|
|
23,257
|
|
|
44,543
|
|
|
(432
|
)
|
|
1,746
|
|
|
67,774
|
|
|
69,520
|
|
|
(31,069
|
)
|
|
1995
|
Westmoreland Mall, Greensburg, PA
|
|
63,639
|
|
|
4,621
|
|
|
84,215
|
|
|
14,454
|
|
|
—
|
|
|
4,621
|
|
|
98,669
|
|
|
103,290
|
|
|
(29,023
|
)
|
|
2002
|
York Galleria, York, PA
|
|
55,057
|
|
|
5,757
|
|
|
63,316
|
|
|
9,521
|
|
|
—
|
|
|
5,757
|
|
|
72,837
|
|
|
78,594
|
|
|
(25,591
|
)
|
|
1995
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ASSOCIATED CENTERS:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Annex at Monroeville, Monroeville, PA
|
|
—
|
|
|
716
|
|
|
29,496
|
|
|
(945
|
)
|
|
—
|
|
|
716
|
|
|
28,551
|
|
|
29,267
|
|
|
(6,102
|
)
|
|
2004
|
Bonita Crossing, Meridian, MS
|
|
—
|
|
|
794
|
|
|
4,786
|
|
|
8,746
|
|
|
—
|
|
|
794
|
|
|
13,532
|
|
|
14,326
|
|
|
(4,960
|
)
|
|
1997
|
Chapel Hill Surban, Akron, OH
|
|
—
|
|
|
925
|
|
|
2,520
|
|
|
935
|
|
|
—
|
|
|
925
|
|
|
3,455
|
|
|
4,380
|
|
|
(774
|
)
|
|
2004
|
CoolSprings Crossing, Nashville, TN
|
|
12,887
|
|
|
2,803
|
|
|
14,985
|
|
|
4,525
|
|
|
—
|
|
|
3,554
|
|
|
18,759
|
|
|
22,313
|
|
|
(10,037
|
)
|
|
1991-1993
|
Courtyard at Hickory Hollow, Nashville, TN
|
—
|
|
|
3,314
|
|
|
2,771
|
|
|
(3,022
|
)
|
|
(231
|
)
|
|
1,500
|
|
|
1,332
|
|
|
2,832
|
|
|
(22
|
)
|
|
1998
|
Eastgate Crossing, Cincinnati, OH
|
|
15,324
|
|
|
707
|
|
|
2,424
|
|
|
7,442
|
|
|
(11
|
)
|
|
696
|
|
|
9,866
|
|
|
10,562
|
|
|
(2,479
|
)
|
|
2001
|
Foothills Plaza , Maryville, TN
|
|
—
|
|
|
132
|
|
|
2,132
|
|
|
626
|
|
|
—
|
|
|
148
|
|
|
2,742
|
|
|
2,890
|
|
|
(1,920
|
)
|
|
1984-1988
|
Foothills Plaza Expansion, Maryville, TN
|
—
|
|
|
137
|
|
|
1,960
|
|
|
947
|
|
|
—
|
|
|
141
|
|
|
2,903
|
|
|
3,044
|
|
|
(1,440
|
)
|
|
1984-1988
|
Frontier Square, Cheyenne, WY
|
|
—
|
|
|
346
|
|
|
684
|
|
|
374
|
|
|
(86
|
)
|
|
260
|
|
|
1,058
|
|
|
1,318
|
|
|
(555
|
)
|
|
1985
|
General Cinema, Athens, GA
|
|
—
|
|
|
100
|
|
|
1,082
|
|
|
173
|
|
|
—
|
|
|
100
|
|
|
1,255
|
|
|
1,355
|
|
|
(1,020
|
)
|
|
1984
|
Gunbarrel Pointe, Chattanooga, TN
|
|
11,472
|
|
|
4,170
|
|
|
10,874
|
|
|
3,314
|
|
|
—
|
|
|
4,170
|
|
|
14,188
|
|
|
18,358
|
|
|
(3,991
|
)
|
|
2000
|
Hamilton Corner, Chattanooga, TN
|
|
15,595
|
|
|
630
|
|
|
5,532
|
|
|
6,346
|
|
|
—
|
|
|
734
|
|
|
11,774
|
|
|
12,508
|
|
|
(5,380
|
)
|
|
1986-1987
|
Hamilton Crossing, Chattanooga, TN
|
|
10,283
|
|
|
4,014
|
|
|
5,906
|
|
|
7,028
|
|
|
(1,370
|
)
|
|
2,644
|
|
|
12,934
|
|
|
15,578
|
|
|
(5,253
|
)
|
|
1987
|
Hamilton Place Outparcel, Chattanooga, TN
|
—
|
|
|
1,110
|
|
|
1,866
|
|
|
(4
|
)
|
|
—
|
|
|
1,110
|
|
|
1,862
|
|
|
2,972
|
|
|
(770
|
)
|
|
2007
|
Harford Annex , Bel Air, MD
|
|
—
|
|
|
2,854
|
|
|
9,718
|
|
|
750
|
|
|
—
|
|
|
2,854
|
|
|
10,468
|
|
|
13,322
|
|
|
(2,311
|
)
|
|
2003
|
The Landing at Arbor Place, Douglasville, GA
|
—
|
|
|
4,993
|
|
|
14,330
|
|
|
1,487
|
|
|
(748
|
)
|
|
4,245
|
|
|
15,817
|
|
|
20,062
|
|
|
(6,661
|
)
|
|
1998-1999
|
Layton Convenience Center, Layton Hills, UT
|
—
|
|
|
—
|
|
|
8
|
|
|
942
|
|
|
—
|
|
|
—
|
|
|
950
|
|
|
950
|
|
|
(203
|
)
|
|
2005
|
Layton Hills Plaza, Layton Hills, UT
|
|
—
|
|
|
—
|
|
|
2
|
|
|
240
|
|
|
—
|
|
|
—
|
|
|
242
|
|
|
242
|
|
|
(111
|
)
|
|
2005
|
Madison Plaza , Huntsville, AL
|
|
—
|
|
|
473
|
|
|
2,888
|
|
|
3,678
|
|
|
—
|
|
|
473
|
|
|
6,566
|
|
|
7,039
|
|
|
(3,709
|
)
|
|
1984
|
The Plaza at Fayette Mall, Lexington, KY
|
|
40,634
|
|
|
9,531
|
|
|
27,646
|
|
|
4,102
|
|
|
—
|
|
|
9,531
|
|
|
31,748
|
|
|
41,279
|
|
|
(7,286
|
)
|
|
2006
|
Parkdale Crossing, Beaumont, TX
|
|
—
|
|
|
2,994
|
|
|
7,408
|
|
|
2,088
|
|
|
(355
|
)
|
|
2,639
|
|
|
9,496
|
|
|
12,135
|
|
|
(2,465
|
)
|
|
2002
|
The Shoppes At Hamilton Place, Chattanooga, TN (E)
|
—
|
|
|
4,894
|
|
|
11,700
|
|
|
1,493
|
|
|
—
|
|
|
4,894
|
|
|
13,193
|
|
|
18,087
|
|
|
(3,042
|
)
|
|
2003
|
SCHEDULE III
CBL & ASSOCIATES PROPERTIES, INC.
REAL ESTATE ASSETS AND ACCUMULATED DEPRECIATION
At December 31, 2012
(In thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Initial Cost(A)
|
|
|
|
|
|
Gross Amounts at Which Carried at Close of Period
|
|
|
Description /Location
|
|
Encumbrances
(B)
|
|
Land
|
|
Buildings and Improvements
|
|
Costs
Capitalized Subsequent to Acquisition
|
|
Sales of Outparcel
Land
|
|
Land
|
|
Buildings and Improvements
|
|
Total (C)
|
|
Accumulated Depreciation (D)
|
|
Date of Construction
/ Acquisition
|
Sunrise Commons, Brownsville, TX
|
|
—
|
|
|
1,013
|
|
|
7,525
|
|
|
1,108
|
|
|
—
|
|
|
1,013
|
|
|
8,633
|
|
|
9,646
|
|
|
(1,985
|
)
|
|
2003
|
The Shoppes at Panama City, Panama City, FL
|
—
|
|
|
1,010
|
|
|
8,294
|
|
|
781
|
|
|
(318
|
)
|
|
896
|
|
|
8,871
|
|
|
9,767
|
|
|
(1,861
|
)
|
|
2004
|
The Shoppes at St. Clair, St. Louis, MO
|
|
20,594
|
|
|
8,250
|
|
|
23,623
|
|
|
536
|
|
|
(5,044
|
)
|
|
3,206
|
|
|
24,159
|
|
|
27,365
|
|
|
(5,949
|
)
|
|
2007
|
The Terrace, Chattanooga, TN
|
|
14,224
|
|
|
4,166
|
|
|
9,929
|
|
|
7,544
|
|
|
—
|
|
|
6,536
|
|
|
15,103
|
|
|
21,639
|
|
|
(3,781
|
)
|
|
1997
|
Village at RiverGate, Nashville, TN
|
|
—
|
|
|
2,641
|
|
|
2,808
|
|
|
1,075
|
|
|
—
|
|
|
2,641
|
|
|
3,883
|
|
|
6,524
|
|
|
(1,329
|
)
|
|
1998
|
West Towne Crossing, Madison, WI
|
|
—
|
|
|
1,151
|
|
|
2,955
|
|
|
312
|
|
|
—
|
|
|
1,151
|
|
|
3,267
|
|
|
4,418
|
|
|
(924
|
)
|
|
1998
|
Westgate Crossing, Spartanburg, SC
|
|
—
|
|
|
1,082
|
|
|
3,422
|
|
|
6,113
|
|
|
—
|
|
|
1,082
|
|
|
9,535
|
|
|
10,617
|
|
|
(3,240
|
)
|
|
1997
|
Westmoreland South, Greensburg, PA
|
|
—
|
|
|
2,898
|
|
|
21,167
|
|
|
8,981
|
|
|
—
|
|
|
2,898
|
|
|
30,148
|
|
|
33,046
|
|
|
(7,415
|
)
|
|
2002
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
COMMUNITY CENTERS:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cobblestone Village, Palm Coast, FL
|
|
—
|
|
|
6,082
|
|
|
12,070
|
|
|
(310
|
)
|
|
(220
|
)
|
|
4,296
|
|
|
13,326
|
|
|
17,622
|
|
|
(1,760
|
)
|
|
2007
|
The Promenade at D'lberville, D'lberville, MS
|
|
58,000
|
|
|
16,278
|
|
|
48,806
|
|
|
9,124
|
|
|
(706
|
)
|
|
15,879
|
|
|
57,623
|
|
|
73,502
|
|
|
(6,185
|
)
|
|
2009
|
The Forum at Grand View, Madison , MS
|
|
10,200
|
|
|
9,234
|
|
|
17,285
|
|
|
14,956
|
|
|
(288
|
)
|
|
9,048
|
|
|
32,139
|
|
|
41,187
|
|
|
(1,133
|
)
|
|
2010
|
Statesboro Crossing, Statesboro, GA
|
|
13,482
|
|
|
2,855
|
|
|
17,805
|
|
|
362
|
|
|
(235
|
)
|
|
2,840
|
|
|
17,947
|
|
|
20,787
|
|
|
(2,460
|
)
|
|
2008
|
Waynesville Commons, Waynesville, NC
|
|
—
|
|
|
3,511
|
|
|
6,141
|
|
|
—
|
|
|
—
|
|
|
3,511
|
|
|
6,141
|
|
|
9,652
|
|
|
(43
|
)
|
|
2012
|
Pemberton Plaza, Vicksburg, MS
|
|
—
|
|
|
1,284
|
|
|
1,379
|
|
|
288
|
|
|
—
|
|
|
1,284
|
|
|
1,667
|
|
|
2,951
|
|
|
(503
|
)
|
|
2004
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
OFFICE BUILDINGS:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CBL Center, Chattanooga, TN
|
|
21,675
|
|
|
140
|
|
|
24,675
|
|
|
(45
|
)
|
|
—
|
|
|
140
|
|
|
24,630
|
|
|
24,770
|
|
|
(11,672
|
)
|
|
2001
|
CBL Center II, Chattanooga, TN
|
|
—
|
|
|
—
|
|
|
13,648
|
|
|
984
|
|
|
—
|
|
|
—
|
|
|
14,632
|
|
|
14,632
|
|
|
(2,647
|
)
|
|
2008
|
Oak Branch Business Center, Greensboro, NC
|
|
—
|
|
|
535
|
|
|
2,192
|
|
|
(151
|
)
|
|
—
|
|
|
535
|
|
|
2,041
|
|
|
2,576
|
|
|
(365
|
)
|
|
2007
|
One Oyster Point, Newport News, VA
|
|
—
|
|
|
1,822
|
|
|
3,623
|
|
|
235
|
|
|
—
|
|
|
1,822
|
|
|
3,858
|
|
|
5,680
|
|
|
(781
|
)
|
|
2007
|
Pearland Office, Pearland, TX
|
|
—
|
|
|
—
|
|
|
7,849
|
|
|
1,443
|
|
|
—
|
|
|
—
|
|
|
9,292
|
|
|
9,292
|
|
|
(1,102
|
)
|
|
2009
|
Peninsula Business Center I, Newport News
|
|
—
|
|
|
887
|
|
|
1,440
|
|
|
429
|
|
|
—
|
|
|
887
|
|
|
1,869
|
|
|
2,756
|
|
|
(464
|
)
|
|
2007
|
Peninsula Business Center II, Newport News
|
|
—
|
|
|
1,654
|
|
|
873
|
|
|
170
|
|
|
—
|
|
|
1,654
|
|
|
1,043
|
|
|
2,697
|
|
|
(540
|
)
|
|
2007
|
Two Oyster Point, Newport News, VA
|
|
—
|
|
|
1,543
|
|
|
3,974
|
|
|
341
|
|
|
—
|
|
|
1,543
|
|
|
4,315
|
|
|
5,858
|
|
|
(1,017
|
)
|
|
2007
|
840 Greenbrier Circle, Chesapeake, VA
|
|
—
|
|
|
2,096
|
|
|
3,091
|
|
|
(168
|
)
|
|
—
|
|
|
2,096
|
|
|
2,923
|
|
|
5,019
|
|
|
(621
|
)
|
|
2007
|
850 Greenbrier Circle, Chesapeake, VA
|
|
—
|
|
|
3,154
|
|
|
6,881
|
|
|
(360
|
)
|
|
—
|
|
|
3,154
|
|
|
6,521
|
|
|
9,675
|
|
|
(1,025
|
)
|
|
2007
|
1500 Sunday Drive, Raleigh, NC
|
|
—
|
|
|
812
|
|
|
8,872
|
|
|
657
|
|
|
—
|
|
|
812
|
|
|
9,528
|
|
|
10,340
|
|
|
(2,198
|
)
|
|
2007
|
Pearland Hotel, Pearland, TX
|
|
—
|
|
|
—
|
|
|
16,149
|
|
|
289
|
|
|
—
|
|
|
—
|
|
|
16,438
|
|
|
16,438
|
|
|
(2,488
|
)
|
|
2008
|
Pearland Residential, Pearland, TX
|
|
—
|
|
|
—
|
|
|
9,666
|
|
|
9
|
|
|
—
|
|
|
—
|
|
|
9,675
|
|
|
9,675
|
|
|
(1,185
|
)
|
|
2008
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
DISPOSITIONS:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Lake Point Office Building Greensboro, NC (H)
|
—
|
|
|
1,435
|
|
|
14,261
|
|
|
746
|
|
|
—
|
|
|
|
|
16,442
|
|
|
16,442
|
|
|
—
|
|
|
2007
|
Sun Trust Bank Building, Greensboro, NC (H)
|
—
|
|
|
941
|
|
|
18,417
|
|
|
(6,374
|
)
|
|
—
|
|
|
|
|
12,984
|
|
|
12,984
|
|
|
—
|
|
|
2007
|
SCHEDULE III
CBL & ASSOCIATES PROPERTIES, INC.
REAL ESTATE ASSETS AND ACCUMULATED DEPRECIATION
At December 31, 2012
(In thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Initial Cost(A)
|
|
|
|
|
|
Gross Amounts at Which Carried at Close of Period
|
|
|
Description /Location
|
|
Encumbrances
(B)
|
|
Land
|
|
Buildings and Improvements
|
|
Costs
Capitalized Subsequent to Acquisition
|
|
Sales of Outparcel
Land
|
|
Land
|
|
Buildings and Improvements
|
|
Total (C)
|
|
Accumulated Depreciation (D)
|
|
Date of Construction
/ Acquisition
|
Hickory Hollow Mall, Nashville, TN
|
|
—
|
|
|
13,813
|
|
|
111,431
|
|
|
(125,244
|
)
|
|
—
|
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1998
|
Massard Crossing, Ft Smith, AR
|
|
—
|
|
|
2,879
|
|
|
5,176
|
|
|
(8,055
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2004
|
Oak Hollow Square, High Point, NC
|
|
—
|
|
|
8,609
|
|
|
9,097
|
|
|
(17,706
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2007
|
Settler's Ridge-Phase II, Robinson Township, PA
|
—
|
|
|
1,011
|
|
|
14,922
|
|
|
(15,933
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2011
|
Towne Mall, Franklin, OH
|
|
—
|
|
|
3,101
|
|
|
17,033
|
|
|
(20,134
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2001
|
Willowbrook Land, Houston, TX
|
|
—
|
|
|
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2007
|
Willowbrook Plaza, Houston, TX
|
|
—
|
|
|
15,079
|
|
|
27,376
|
|
|
(42,455
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2004
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other - Land
|
|
729,614
|
|
|
1,386
|
|
|
4,486
|
|
|
314
|
|
|
(879
|
)
|
|
508
|
|
|
4,799
|
|
|
5,307
|
|
|
(923
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Developments in progress consisting of construction and Development Properties (G)
|
|
436,887
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
137,956
|
|
|
137,956
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TOTALS
|
|
$
|
5,182,565
|
|
|
$
|
966,434
|
|
|
$
|
5,929,412
|
|
|
$
|
1,300,633
|
|
|
$
|
(33,422
|
)
|
|
$
|
905,339
|
|
|
$
|
7,395,674
|
|
|
$
|
8,301,013
|
|
|
$
|
(1,972,031
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(A)
|
Initial cost represents the total cost capitalized including carrying cost at the end of the first fiscal year in which the property opened or was acquired.
|
|
|
(B)
|
Encumbrances represent the mortgage notes payable balance at
December 31, 2012
.
|
|
|
(C)
|
The aggregate cost of land and buildings and improvements for federal income tax purposes is approximately
$7.667 billion
.
|
|
|
(D)
|
Depreciation for all properties is computed over the useful life which is generally
40
years for buildings,
10
-
20
years for certain improvements and
7
-
10
years for equipment and fixtures.
|
|
|
(E)
|
Property is pledged as collateral on a secured line of credit.
|
|
|
(F)
|
Only certain parcels at these Properties have been pledged as collateral on a secured line of credit.
|
|
|
(G)
|
Includes non-property mortgages and credit line mortgages.
|
|
|
(H)
|
Asset balance is classified as held for sale.
|
SCHEDULE III
CBL & ASSOCIATES PROPERTIES, INC.
REAL ESTATE ASSETS AND ACCUMULATED DEPRECIATION
At December 31, 2012
(In thousands)
CBL & ASSOCIATES PROPERTIES, INC.
REAL ESTATE ASSETS AND ACCUMULATED DEPRECIATION
The changes in real estate assets and accumulated depreciation for the years ending
December 31, 2012
,
2011
, and
2010
are set forth below (in thousands):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year Ended December 31,
|
|
2012
|
|
2011
|
|
2010
|
REAL ESTATE ASSETS:
|
|
|
|
|
|
Balance at beginning of period
|
$
|
7,767,819
|
|
|
$
|
8,611,331
|
|
|
$
|
8,600,875
|
|
Additions during the period:
|
|
|
|
|
|
|
|
|
Additions and improvements
|
217,161
|
|
|
201,359
|
|
|
170,696
|
|
Acquisitions of real estate assets
|
474,623
|
|
|
11,197
|
|
|
72,907
|
|
Deductions during the period:
|
|
|
|
|
|
|
|
|
Disposals, deconsolidations and accumulated depreciation on impairments
|
(108,554
|
)
|
|
(999,685
|
)
|
|
(183,762
|
)
|
Transfers from real estate assets
|
808
|
|
|
(476
|
)
|
|
(23,950
|
)
|
Impairment of real estate assets
|
(50,844
|
)
|
|
(55,907
|
)
|
|
(25,435
|
)
|
Balance at end of period
|
$
|
8,301,013
|
|
|
$
|
7,767,819
|
|
|
$
|
8,611,331
|
|
|
|
|
|
|
|
ACCUMULATED DEPRECIATION:
|
|
|
|
|
|
|
|
|
Balance at beginning of period
|
$
|
1,762,149
|
|
|
$
|
1,721,194
|
|
|
$
|
1,505,840
|
|
Depreciation expense
|
247,702
|
|
|
260,847
|
|
|
268,386
|
|
Accumulated depreciation on real estate assets sold, retired or deconsolidated and on impairments
|
(37,820
|
)
|
|
(219,892
|
)
|
|
(53,032
|
)
|
Balance at end of period
|
$
|
1,972,031
|
|
|
$
|
1,762,149
|
|
|
$
|
1,721,194
|
|
Schedule IV
CBL & ASSOCIATES PROPERTIES, INC.
MORTGAGE NOTES RECEIVABLE ON REAL ESTATE
AT
DECEMBER 31, 2012
(In thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Name Of Center/Location
|
|
Interest
Rate
|
|
Final Maturity Date
|
|
Monthly
Payment
Amount
(1)
|
|
Balloon Payment
At
Maturity
|
|
Prior
Liens
|
|
Face
Amount Of
Mortgage
|
|
Carrying
Amount Of
Mortgage
(2)
|
|
Principal
Amount Of
Mortgage
Subject To
Delinquent
Principal
Or Interest
|
FIRST MORTGAGES:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Coastal Grand-MyrtleBeach - Myrtle Beach, SC
|
|
7.75
|
%
|
|
|
Oct-2014
|
|
$
|
58
|
|
(3
|
)
|
|
|
$
|
9,000
|
|
|
None
|
|
$
|
9,000
|
|
|
$
|
9,000
|
|
|
$
|
—
|
|
One Park Place - Chattanooga, TN
|
|
5.00
|
%
|
|
|
May-2022
|
|
21
|
|
(4
|
)
|
|
|
2,007
|
|
|
None
|
|
3,200
|
|
|
1,902
|
|
|
—
|
|
Village Square - Houghton Lake, MI and Village at Wexford - Cadillac, MI
|
|
4.25
|
%
|
(5)
|
|
Mar-2015
|
|
10
|
|
(3
|
)
|
(4
|
)
|
|
2,600
|
|
|
None
|
|
2,627
|
|
|
2,600
|
|
|
—
|
|
OTHER
|
|
2.71% -
12.00%
|
|
(7)
|
|
Jul-2011/
Jan-2047
|
|
17
|
|
|
|
|
|
3,418
|
|
|
|
|
6,460
|
|
|
5,881
|
|
|
78
|
|
|
|
|
|
|
|
|
|
$
|
106
|
|
|
|
|
|
$
|
17,025
|
|
|
|
|
$
|
21,287
|
|
|
$
|
19,383
|
|
|
$
|
78
|
|
(1) Equal monthly installments comprised of principal and interest, unless otherwise noted.
(2) The aggregate carrying value for federal income tax purposes was
$19,383
at
December 31, 2012
.
(3) Payment represents interest only.
(4) Loans included in the schedule above which were extended or renewed during the year ended
December 31, 2012
aggregated approximately
$4,607
.
(5) Interest rate increases annually to
4.50%
on April 1, 2013 and
4.75%
on April 1, 2014.
(6) Unpaid principal and interest are due upon maturity. Subsequent to
December 31, 2012
,
$3,525
was paid to reduce the balance of the note receivable.
(7) Mortgage and other notes receivable aggregated in Other included a variable-rate note that bears interest at prime plus
2.0%
, currently at
5.25%
, and a variable-rate note that bears interest at LIBOR plus
2.50%
.
The changes in mortgage notes receivable were as follows (in thousands):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year Ended December 31,
|
|
2012
|
|
2011
|
|
2010
|
Beginning balance
|
$
|
34,239
|
|
|
$
|
30,519
|
|
|
$
|
38,208
|
|
Additions
|
—
|
|
|
15,334
|
|
|
1,001
|
|
Receipt of land in lieu of payment
|
—
|
|
|
(2,235
|
)
|
|
—
|
|
Non-cash transfer
|
(12,741
|
)
|
|
—
|
|
|
(7,081
|
)
|
Write-off of uncollectible amounts
|
—
|
|
|
(1,900
|
)
|
|
—
|
|
Payments
|
(2,115
|
)
|
|
(7,479
|
)
|
|
(1,609
|
)
|
Ending balance
|
$
|
19,383
|
|
|
$
|
34,239
|
|
|
$
|
30,519
|
|
EXHIBIT INDEX
|
|
|
Exhibit
Number
|
Description
|
3.1
|
Amended and Restated Certificate of Incorporation of the Company, as amended through May 2, 2011 (v)
|
3.2
|
Amended and Restated Bylaws of the Company, as amended through May 2, 2011 (v)
|
4.1
|
See Amended and Restated Certificate of Incorporation of the Company, as amended, and Amended and Restated Bylaws of the Company relating to the Common Stock, Exhibits 3.1 and 3.2 above
|
4.2
|
Certificate of Designations, dated June 25, 1998, relating to the 9.0% Series A Cumulative Redeemable Preferred Stock (d)
|
4.3
|
Certificate of Designation, dated April 30, 1999, relating to the Series 1999 Junior Participating Preferred Stock (d)
|
4.4
|
Terms of Series J Special Common Units of the Operating Partnership, pursuant to Article 4.4 of the Second Amended and Restated Partnership Agreement of the Operating Partnership (d)
|
4.5
|
Certificate of Designations, dated June 11, 2002, relating to the 8.75% Series B Cumulative Redeemable Preferred Stock (e)
|
4.6
|
Acknowledgement Regarding Issuance of Partnership Interests and Assumption of Partnership Agreement (g)
|
4.7
|
Certificate of Designations, dated August 13, 2003, relating to the 7.75% Series C Cumulative Redeemable Preferred Stock (f)
|
4.8
|
Certificate of Correction of the Certificate of Designations relating to the 7.75% Series C Cumulative Redeemable Preferred Stock (h)
|
4.9
|
Certificate of Designations, dated December 10, 2004, relating to the 7.375% Series D Cumulative Redeemable Preferred Stock (h)
|
4.9.1
|
Amended and Restated Certificate of Designations, dated February 25, 2010, relating to the 7.375% Series D Cumulative Redeemable Preferred Stock (q)
|
4.9.2
|
Second Amended and Restated Certificate of Designations, dated October 14, 2010, relating to the 7.375% Series D Cumulative Redeemable Preferred Stock (s)
|
4.10
|
Certificate of Designations, dated October 1, 2012, relating to the 6.625% Series E Cumulative Redeemable Preferred Stock (z)
|
4.11
|
Terms of the Series S Special Common Units of the Operating Partnership, pursuant to the Third Amendment to the Second Amended and Restated Partnership Agreement of the Operating Partnership (i)
|
4.12
|
Terms of the Series L Special Common Units of the Operating Partnership, pursuant to the Fourth Amendment to the Second Amended and Restated Partnership Agreement of the Operating Partnership (j)
|
4.13
|
Terms of the Series K Special Common Units of the Operating Partnership, pursuant to the First Amendment to the Third Amended and Restated Partnership Agreement of the Operating Partnership (j)
|
10.1.1
|
Fourth Amended and Restated Agreement of Limited Partnership of the Operating Partnership, dated November 2, 2010 (t)
|
10.1.2
|
Certificate of Designation, dated October 1, 2012, relating to the 6.625% Series E Cumulative Preferred Units (aa)
|
10.2
|
Property Management Agreement between the Operating Partnership and the Management Company (a)
|
10.3
|
Property Management Agreement relating to Retained Properties (a)
|
10.4
|
Subscription Agreement relating to purchase of the Common Stock and Preferred Stock of the Management Company (a)
|
10.5.1
|
CBL & Associates Properties, Inc. Second Amended and Restated Stock Incentive Plan† (r)
|
10.5.2
|
Form of Stock Restriction Agreement for restricted stock awards in 2006 and subsequent years† (l)
|
10.5.3
|
First Amendment to CBL & Associates Properties, Inc. Second Amended and Restated Stock Incentive Plan† (w)
|
10.5.4
|
CBL & Associates Properties, Inc. 2012 Stock Incentive Plan† (x)
|
10.5.5
|
Form of Stock Restriction Agreement for Restricted Stock Awards under CBL & Associates Properties, Inc. 2012 Stock Incentive Plan†
|
|
|
|
Exhibit
Number
|
Description
|
10.6
|
Form of Indemnification Agreements between the Company and the Management Company and their officers and directors (a)
|
10.7.1
|
Employment Agreement for Charles B. Lebovitz† (a)
|
10.7.2
|
Employment Agreement for John N. Foy† (a)
|
10.7.3
|
Employment Agreement for Stephen D. Lebovitz† (a)
|
10.7.4
|
Summary Description of CBL & Associates Properties, Inc. Director Compensation Arrangements†
|
10.7.5
|
CBL & Associates Properties, Inc. Tier III Post-65 Retiree Program† (bb)
|
10.8.1
|
Option Agreement relating to certain Retained Properties (a)
|
10.8.2
|
Option Agreement relating to Outparcels (a)
|
10.9.1
|
Property Partnership Agreement relating to Hamilton Place (a)
|
10.9.2
|
Property Partnership Agreement relating to CoolSprings Galleria (a)
|
10.10.1
|
Acquisition Option Agreement relating to Hamilton Place (a)
|
10.10.2
|
Acquisition Option Agreement relating to the Hamilton Place Centers (a)
|
10.11.1
|
Second Amended and Restated Credit Agreement by and among the Operating Partnership and the Company, and Wells Fargo Bank, National Association, et al., dated as of November 2, 2009 (p)
|
10.11.2
|
Letter Agreement, dated October 19, 2010, concerning Second Amended and Restated Credit Agreement by and among the Operating Partnership and the Company, and Wells Fargo Bank, National Association, et al., dated as of November 2, 2009 (u)
|
10.11.3
|
First Amendment to Second Amended and Restated Credit Agreement by and among the Operating Partnership and the Company, and Wells Fargo Bank, National Association, et al., dated as of June 29, 2011 (w)
|
10.11.4
|
Letter Agreement, dated July 12, 2011, concerning First Amendment to Second Amended and Restated Credit Agreement by and among the Operating Partnership and the Company and Wells Fargo Bank, National Association, et. al., dated as of June 29, 2011 (w)
|
10.13.1
|
Share Ownership Agreement by and among the Company and its related parties and the Jacobs entities, dated as of January 31, 2001 (c)
|
10.14.1
|
Registration Rights Agreement by and between the Company and the Holders of SCU’s listed on Schedule A thereto, dated as of January 31, 2001 (c)
|
10.14.2
|
Registration Rights Agreement by and between the Company and Frankel Midland Limited Partnership, dated as of January 31, 2001 (c)
|
10.14.3
|
Registration Rights Agreement by and between the Company and Hess Abroms Properties of Huntsville, dated as of January 31, 2001 (c)
|
10.14.4
|
Registration Rights Agreement by and between the Company and the Holders of Series S Special Common Units of the Operating Partnership listed on Schedule A thereto, dated July 28, 2004 (i)
|
10.14.5
|
Form of Registration Rights Agreements between the Company and Certain Holders of Series K Special Common Units of the Operating Partnership, dated as of November 16, 2005 (j)
|
10.15.1
|
Amended and Restated Loan Agreement between the Operating Partnership, The Lakes Mall, LLC, Lakeshore/Sebring Limited Partnership and First Tennessee Bank National Association, dated June 15, 2011 (w)
|
10.15.2
|
Amended and Restated Loan Agreement between the Operating Partnership and First Tennessee Bank National Association, dated June 8, 2012 (y)
|
10.15.3
|
Amended and Restated Loan Agreement by and amoung the Operating Partnership, the Company and First Tennessee Bank National Association, et. a. dated February 22, 2013 (cc)
|
10.16
|
Amended and Restated Limited Liability Company Agreement of JG Gulf Coast Town Center LLC by and between JG Gulf Coast Member LLC, an Ohio limited liability company and CBL/Gulf Coast, LLC, a Florida limited liability company, dated April 27, 2005 (j)
|
10.17.1
|
Contribution Agreement and Joint Escrow Instructions between the Company and the owners of Oak Park Mall named therein, dated as of October 17, 2005 (j)
|
10.17.2
|
First Amendment to Contribution Agreement and Joint Escrow Instructions between the Company and the owners of Oak Park Mall named therein, dated as of November 8, 2005 (j)
|
|
|
|
Exhibit
Number
|
Description
|
10.17.3
|
Contribution Agreement and Joint Escrow Instructions between the Company and the owners of Eastland Mall named therein, dated as of October 17, 2005 (j)
|
10.17.4
|
First Amendment to Contribution Agreement and Joint Escrow Instructions between the Company and the owners of Eastland Mall named therein, dated as of November 8, 2005 (j)
|
10.17.5
|
Purchase and Sale Agreement and Joint Escrow Instructions between the Company and the owners of Hickory Point Mall named therein, dated as of October 17, 2005 (j)
|
10.17.6
|
Purchase and Sale Agreement and Joint Escrow Instructions between the Company and the owner of Eastland Medical Building, dated as of October 17, 2005 (j)
|
10.17.7
|
Letter Agreement, dated as of October 17, 2005, between the Company and the other parties to the acquisition agreements listed above for Oak Park Mall, Eastland Mall, Hickory Point Mall and Eastland Medical Building (j)
|
10.18.1
|
Master Transaction Agreement by and among REJ Realty LLC, JG Realty Investors Corp., JG Manager LLC, JG North Raleigh L.L.C., JG Triangle Peripheral South LLC, and the Operating Partnership, effective October 24, 2005 (k)
|
10.18.2
|
Amended and Restated Limited Liability Company Agreement of Triangle Town Member, LLC by and among CBL Triangle Town Member, LLC and REJ Realty LLC, JG Realty Investors Corp. and JG Manager LLC, effective as of November 16, 2005 (k)
|
10.19.1
|
Contribution Agreement among Westfield America Limited Partnership, as Transferor, and CW Joint Venture, LLC, as Transferee, and CBL & Associates Limited Partnership, dated August 9, 2007 (m)
|
10.19.2
|
Contribution Agreement among CBL & Associates Limited Partnership, as Transferor, St. Clair Square, GP, Inc. and CW Joint Venture, LLC, as Transferee, and Westfield America Limited Partnership, dated August 9, 2007 (m)
|
10.19.3
|
Purchase and Sale Agreement between Westfield America Limited Partnership, as Transferor, and CBL & Associates Limited Partnership, as Transferee, dated August 9, 2007 (m)
|
10.20.1
|
Unsecured Term Loan Agreement, dated April 22, 2008, by and among CBL & Associates Limited Partnership, as Borrower, and CBL & Associates Properties, Inc., as Parent, Wells Fargo Bank, National Association, as Administrative Agent and Lead Arranger, Accrual Capital Corporation, as Syndication Agent, U.S. Bank National Association and Fifth Third Bank (n)
|
10.20.2
|
Joinder in Unsecured Term Loan Agreement, dated April 30, 2008, by and among CBL & Associates Limited Partnership, as Borrower, and CBL & Associates Properties, Inc., as Parent, Wells Fargo Bank, National Association, as Administrative Agent and Lead Arranger, and Raymond James Bank FSB (n)
|
10.20.3
|
Joinder in Unsecured Term Loan Agreement, dated May 7, 2008, by and among CBL & Associates Limited Partnership, as Borrower, and CBL & Associates Properties, Inc., as Parent, Wells Fargo Bank, National Association, as Administrative Agent and Lead Arranger, and Regions Bank (n)
|
10.21.1
|
Seventh Amended and Restated Credit Agreement between CBL & Associates Limited Partnership and Wells Fargo Bank, National Association, et al., dated September 28, 2009 (o)
|
10.21.2
|
First Amendment to Seventh Amended and Restated Credit Agreement between CBL & Associates Limited Partnership and Wells Fargo Bank, National Association, et al., dated July 26, 2011 (w)
|
10.22
|
Narrative Summary of Material Terms of Aircraft Purchase Effective June 1, 2011 (w)
|
10.23.1
|
Third Amended and Restated Credit Agreement by and among the Operating Partnership and the Company, and Wells Fargo Bank, National Association, et al., dated November 13, 2012
|
10.23.2
|
First Amendment to Third Amended and Restated Credit Agreement by and among the Operating Partnership and the Company, and Wells Fargo Bank, National Association, et al., dated January 31, 2013
|
10.24.1
|
Eighth Amended and Restated Credit Agreement between CBL & Associates Limited Partnership and Wells Fargo Bank, National Association, et al., dated November 13, 2012
|
10.24.2
|
First Amendment to Eighth Amended and Restated Credit Agreement between CBL & Associates Limited Partnership and Wells Fargo Bank, National Association, et al., dated January 31, 2013
|
12
|
Computation of Ratio of Earnings to Combined Fixed Charges and Preferred Dividends
|
21
|
Subsidiaries of the Company
|
23
|
Consent of Deloitte & Touche LLP
|
24
|
Power of Attorney
|
|
|
|
Exhibit
Number
|
Description
|
31.1
|
Certification pursuant to Securities Exchange Act Rule 13a-14(a) by the Chief Executive Officer, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
|
31.2
|
Certification pursuant to Securities Exchange Act Rule 13a-14(a) by the Chief Financial Officer, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
|
32.1
|
Certification pursuant to Securities Exchange Act Rule 13a-14(b) by the Chief Executive Officer, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
|
32.2
|
Certification pursuant to Securities Exchange Act Rule 13a-14(b) by the Chief Financial Officer as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
|
101.INS
|
XBRL Instance Document
|
101.SCH
|
XBRL Taxonomy Extension Schema Document
|
101.CAL
|
XBRL Taxonomy Extension Calculation Linkbase Document
|
101.LAB
|
XBRL Taxonomy Extension Label Linkbase Document
|
101.PRE
|
XBRL Taxonomy Extension Presentation Linkbase Document
|
101.DEF
|
XBRL Taxonomy Extension Definition Linkbase Document
|
|
|
(a)
|
Incorporated by reference to Post-Effective Amendment No. 1 to the Company's Registration Statement on Form S-11 (No. 33-67372), as filed with the Commission on January 27, 1994.*
|
|
|
(b)
|
Incorporated by reference to the Company's Quarterly Report on Form 10-Q for the quarter ended June 30, 1998.*
|
|
|
(c)
|
Incorporated by reference from the Company's Current Report on Form 8-K, filed on February 6, 2001.*
|
|
|
(d)
|
Incorporated by reference from the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2001.*
|
|
|
(e)
|
Incorporated by reference from the Company's Current Report on Form 8-K, dated June 10, 2002, filed on June 17, 2002.*
|
|
|
(f)
|
Incorporated by reference from the Company's Registration Statement on Form 8-A, filed on August 21, 2003.*
|
|
|
(g)
|
Incorporated by reference from the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2002.*
|
|
|
(h)
|
Incorporated by reference from the Company's Registration Statement on Form 8-A, filed on December 10, 2004.*
|
|
|
(i)
|
Incorporated by reference from the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2004.*
|
|
|
(j)
|
Incorporated by reference from the Company's Current Report on Form 8-K, filed on November 22, 2005.*
|
|
|
(k)
|
Incorporated by reference from the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2005.*
|
|
|
(l)
|
Incorporated by reference from the Company's Current Report on Form 8-K, filed on May 24, 2006.*
|
|
|
(m)
|
Incorporated by reference from the Company's Quarterly Report on Form 10-Q for the quarter ended September 30, 2007.*
|
|
|
(n)
|
Incorporated by reference from the Company's Quarterly Report on Form 10-Q for the quarter ended June 30, 2008.*
|
|
|
(o)
|
Incorporated by reference from the Company's Current Report on Form 8-K, filed on September 30, 2009.*
|
|
|
(p)
|
Incorporated by reference from the Company's Current Report on Form 8-K, filed on November 5, 2009.*
|
|
|
(q)
|
Incorporated by reference from the Company's Current Report on Form 8-K, filed on March 1, 2010.*
|
|
|
(r)
|
Incorporated by reference from the Company's Quarterly Report on Form 10-Q for the quarter ended June 30, 2010.*
|
|
|
(s)
|
Incorporated by reference from the Company's Current Report on Form 8-K, filed on October 18, 2010.*
|
|
|
(t)
|
Incorporated by reference from the Company's Current Report on Form 8-K, filed on November 5, 2010.*
|
|
|
(u)
|
Incorporated by reference from the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2010.*
|
|
|
(v)
|
Incorporated by reference from the Company's Current Report on Form 8-K, filed on May 4, 2011.*
|
|
|
(w)
|
Incorporated by reference from the Company's Quarterly Report on Form 10-Q for the quarter ended June 30, 2011.*
|
|
|
(x)
|
Incorporated by reference from the Company's Current Report on Form 8-K, filed on May 10, 2012.*
|
|
|
(y)
|
Incorporated by reference from the Company's Quarterly Report on Form 10-Q for the quarter ended June 30, 2012.*
|
|
|
(z)
|
Incorporated by reference from the Company's Registration Statement on Form 8-A, filed on October 1, 2012.*
|
|
|
(aa)
|
Incorporated by reference from the Company's Current Report on Form 8-K, filed on October 5, 2012.*
|
|
|
(bb)
|
Incorporated by reference from the Company's Current Report on Form 8-K, filed on November 9, 2012.*
|
|
|
(cc)
|
Incorporated by reference from the Company's Current Report on Form 8-K, filed on February 28, 2013.*
|
|
|
|
†
|
A management contract or compensatory plan or arrangement required to be filed pursuant to Item 15(b) of this report.
|
* Commission File No. 1-12494
EXHIBIT 10.5.5
20xx STOCK RESTRICTION AGREEMENT
This 20xx Stock Restriction Agreement (the “
Agreement
”) is made as of the ___ day of ________, 20xx (the “
Agreement Date
”), by and between
CBL & ASSOCIATES PROPERTIES, INC.
, a Delaware corporation (the “
Company
”), and «Name» (the “
Employee
”).
WHEREAS
, Employee is employed by CBL & Associates Management, Inc. (the “
CBL Management Company
”, an affiliate of the Company;
WHEREAS
, pursuant to the Stock Incentive Plan (as hereinafter defined) and subject to the terms of this Agreement, the Company desires to grant to the Employee «Shares» shares of Common Stock, par value $.01 per share (the “
Common Stock
”), of the Company.
NOW, THEREFORE
, in connection with the mutual covenants hereinafter set forth and for other good and valuable consideration, the receipt and adequacy of which is hereby acknowledged, the parties hereto agree as follows:
The Employee's date of receipt of the Stock Award set forth in this Agreement shall be and is _______ ___, 20xx (the “
Receipt Date
”).
1.
Definitions; Conflicts
. Capitalized terms used and not otherwise defined herein shall have the meanings ascribed thereto in the CBL & Associates Properties, Inc. 2012 Stock Incentive Plan (the “
Stock Incentive Plan
”) as may be hereafter amended. The terms and provisions of the Stock Incentive Plan are incorporated herein and in the event of any conflict or inconsistency between the terms and provisions of the Stock Incentive Plan and the terms and provisions of this Agreement, the terms and provisions of the Stock Incentive Plan shall govern and control.
2.
Grant of Common Stock
. Subject to the terms and conditions of this Agreement, the Company hereby grants to the Employee all right, title and interest in «Shares» shares of Common Stock (the “
Stock Award
”).
3.
Vesting
. As used in this Agreement, the term “vest” or “vesting” shall mean the immediate, non-forfeitable, fixed right of present or future enjoyment of the Common Stock pursuant to the Stock Award. The Stock Award, subject to the terms, conditions and limitations contained herein (including but not limited to the provisions of
Paragraph 4
below), shall vest in accordance with the following installments: twenty percent (20%) on the first anniversary of the Agreement Date hereof, and an additional twenty percent (20%) on each of the succeeding four (4) anniversaries of the Agreement Date hereof (the “
Vesting Period
”); provided that, with respect to each such installment, the Employee has remained in continuous employment with the CBL Management Company from the Agreement Date through the date such installment is designated to vest.
4.
Termination of Employment
.
(a)
General
. Except as set forth in
Paragraphs 4(b) and 4(c)
below, if the Employee's employment with the CBL Management Company terminates for any reason, any non-vested portion of the Stock Award shall thereupon be forfeited and returned to the Company and the Employee shall have no further right, title and/or interest in the non-vested portion of the shares of Common Stock subject to the Stock Award.
(b)
Death or Disability
. If the Employee's employment with the CBL Management Company terminates for reasons of the Employee's death or disability (as defined herein), the portion of the Stock Award that is non-vested on the date of such termination shall immediately, on the date of such termination of employment, thereupon vest in the Employee or his/her estate. For purposes hereof, the term “disability” refers to the complete and permanent disability of the Employee as defined by the Company's health insurance plans or as otherwise defined by the Company from time to time. The Employee acknowledges and agrees that the determination of disability shall be within the sole, absolute and exclusive discretion of the Company.
(c)
Retirement After Attainment of 70 Years of Age
. If the Employee's employment with the CBL Management Company terminates by reason of retirement after the Employee has reached 70 years of age and the Employee has maintained at least 10 years of continuous employment with the Company, its Subsidiaries or Affiliates including the CBL Management Company, the portion of the Stock Award that is non-vested on the date of such termination shall immediately, on the date of such termination of employment, thereupon vest in the Employee.
5.
Rights as a Shareholder
. The Employee shall have all of the rights as a shareholder with respect to any shares of Common Stock issued pursuant to the Stock Award subject only to the transfer restrictions set forth in
Paragraph 6
below and forfeiture provisions set forth above. The Employee's rights as a shareholder shall include the rights to receive all dividends on the Common Stock and to exercise any voting rights attributable to the Common Stock for so long as the Employee shall own the Common Stock but such rights shall cease as to any non-vested portion of the shares of Common Stock subject to the Stock Award that are forfeited pursuant to the terms of this Agreement.
6.
Non-Transferability of Stock Award
. Except for any transfers that may be required by law, including pursuant to any domestic relations order or otherwise, no non-vested portion of the Common Stock making up the Stock Award may be transferred by the Employee until the termination of the Vesting Period (or immediate vesting pursuant to the provisions of
Paragraphs 4(b) or 4(c)
above on terminations of employment with the CBL Management Company for death or disability or retirement after attainment of 70 years of age) and any non-permitted attempted transfer by the Employee of any such non-vested portion prior to the termination of the Vesting Period shall be null and void. Any transferee who may receive any of such non-vested portion of the Common Stock making up the Stock Award pursuant to a transfer required by law as set forth above shall be subject to all the terms and provisions of this Agreement and any termination of the employment of the Employee prior to the termination of the Vesting Period (except for terminations of employment pursuant to
Paragraphs 4(b) or 4(c)
above on death or disability or retirement after attainment of 70 years of age) shall cause the forfeiture of any non-vested shares of the Common Stock making up the Stock Award even if such shares are in the hands of a transferee.
7.
Restricted Stock Account; Uncertificated Shares
. The Employee understands and acknowledges that the shares of Common Stock issued to the Employee pursuant to the Stock Award will be held in an uncertificated form in a restricted stock account maintained by the Company's stock transfer agent for the Employee until such time as such shares of Common Stock are no longer subject to the restrictions set forth in this Agreement. The Employee understands and acknowledges that as the shares of Common Stock issued to the Employee pursuant to the Stock Award shall vest during the Vesting Period and upon such vesting, the Company shall cause such vested shares to be issued out of the above-stated restricted stock account and delivered to an unrestricted stock account maintained by the Company's stock transfer agent for the Employee (with reduction in the number of shares necessary to cover any applicable employment taxes unless the Employee shall elect to pay such amounts in cash pursuant to notices and procedures that the Company has instituted or shall institute) and such vested shares shall no longer be subject to the terms and provisions of this Agreement. The Employee understands and acknowledges that in the event the
Employee's employment with the Company, its Subsidiaries or Affiliates including the CBL Management Company, is terminated at any time during the Vesting Period, any non-vested shares of Common Stock making up the Stock Award shall then be cancelled and/or returned to the Company and that the Company shall be entitled to take such action on behalf of the Employee in the form of executing such documents or instruments to authorize the cancellation of such shares and/or return of same to the Company
8.
No Enlargement of Employee Rights
. Nothing in this Agreement shall be construed to confer upon the Employee any right to continued employment or to restrict in any way the right of the Company or any Subsidiary or Affiliate including the CBL Management Company to terminate the Employee's employment at any time.
9.
Income Tax Withholding
. The Company, in its sole discretion, shall make such provisions and take such steps as it may deem necessary or appropriate for the withholding of all Federal, state, local and other taxes required by law to be withheld with respect to the shares of Common Stock issued pursuant to the Stock Award (as such shares vest or if certain tax elections are made by the Employee, i.e., a Section 83(b) election under applicable provisions of the Internal Revenue Code of 1986, as amended (the “
Code
”)) and any dividends paid on any portion of non-vested shares of Common Stock, including, but not limited to, the following: (i) deducting the amount of any such withholding taxes therefrom or from any other amounts then or thereafter payable to the Employee by the Company or any of its Subsidiaries or Affiliates including the CBL Management Company; (ii) requiring the Employee, or the beneficiary or legal representative of the Employee, to pay to the Company the amount required to be withheld or to execute such documents as the Company deems necessary or desirable to enable the Company to satisfy its withholding obligations; and/or (iii) withholding from the shares of Common Stock otherwise payable and/or deliverable one or more of such shares having an aggregate Fair Market Value, determined as of the date the withholding tax obligation arises, less than or equal to the amount of the total withholding tax obligation.
10.
Restricted Stock
. The Stock Award granted hereunder is intended to be a grant of restricted property to the Employee that is subject to a “substantial risk of forfeiture” as defined in Section 83 of the Code.
11.
Binding Effect
. This Agreement shall be binding upon the heirs, executors, administrators and successors of the parties hereto.
12.
Governing Law
. This Agreement shall be construed and interpreted in accordance with the laws of the State of Delaware without reference to the principles of conflicts of laws thereof.
13.
Headings
. Headings are for the convenience of the parties and are not deemed to be part of this Agreement.
14.
Power of Attorney
. The Employee, by execution of this Agreement, does hereby appoint the Company as the Employee's attorney-in-fact for the limited purposes of executing any documents or instruments necessary in conjunction with the shares of Common Stock issued to the Employee pursuant to the Stock Award while such shares are subject to the restrictions provided by this Agreement. The employee understands and acknowledges that the shares of Common Stock issued to the Employee pursuant to the Stock Award may be subject to adjustment or substitution, as determined by the Company or the Company's Compensation Committee, as to the number, price or kind of a share of stock or other consideration subject to such awards or as otherwise determined by the Company or the Company's Compensation Committee to be equitable in the event of changes in the outstanding stock or in the capital structure of the Company by reason of stock dividends, stock splits, reverse stock splits, recapitalizations, reorganizations, mergers, consolidations, combinations, exchanges, or other relevant changes in capitalization occurring after the date of grant of any such award.
15.
Section 83(b) Election
. By execution of this Agreement, the Employee is acknowledging that he/she understands that he/she may make a Section 83(b) Election with respect to the Stock Award pursuant to applicable provisions of the Code but that such election must be made on or before the date that is thirty (30) days from the Receipt Date set forth above.
16.
Reference to Company
.
The Stock Award granted hereunder is being made to the Employee by virtue of the Employee's status as an employee of the CBL Management Company. As stated above, the CBL Management Company is an affiliate of the Company. The use of the term “Company” in this Agreement shall, unless the context specifically states otherwise, be deemed to include both CBL & Associates Properties, Inc. and the CBL Management Company.
IN WITNESS WHEREOF
, the parties hereto have executed this Agreement as of the Agreement Date first written above.
CBL & ASSOCIATES PROPERTIES, INC.
By:
_______________________________________
Stephen D. Lebovitz,
President and Chief Executive Officer
EMPLOYEE
:
______________________________________
«Name»
EXHIBIT 10.23.1
EXECUTION COPY
Loan Number: 101012
THIRD AMENDED AND RESTATED CREDIT AGREEMENT
Dated as of November 13, 2012
by and among
CBL & ASSOCIATES LIMITED PARTNERSHIP,
as Borrower,
CBL & ASSOCIATES PROPERTIES, INC.,
as Parent, solely for the limited purposes
set forth in Section 13.22.,
THE FINANCIAL INSTITUTIONS PARTY HERETO
AND THEIR ASSIGNEES UNDER SECTION 13.6.,
as Lenders,
WELLS FARGO BANK, NATIONAL ASSOCIATION,
as Administrative Agent,
U.S. BANK NATIONAL ASSOCIATION,
as Syndication Agent
and
BANK OF AMERICA, N.A., KEYBANK, NATIONAL ASSOCIATION,
JPMORGAN CHASE BANK, N.A., and PNC BANK, NATIONAL ASSOCIATION,
as Documentation Agents
WELLS FARGO SECURITIES, LLC and
U.S. BANK NATIONAL ASSOCIATION,
as Co-Lead Arrangers and Co-Book Runners
|
|
|
|
|
|
TABLE OF CONTENTS
|
|
|
|
Article I.
|
Definitions
|
|
|
Section 1.1.
|
Definitions
|
|
|
Section 1.2.
|
General; References to Central Time
|
|
|
Section 1.3.
|
Financial Attributes of Non-Wholly Owned Subsidiaries
|
|
|
|
|
|
Article II.
|
Credit Facility
|
|
|
Section 2.1.
|
Revolving Loans
|
|
|
Section 2.2.
|
Letters of Credit
|
|
|
Section 2.3.
|
Swingline Loans
|
|
|
Section 2.4.
|
Rates and Payment of Interest on Loans
|
|
|
Section 2.5.
|
Number of Interest Periods.
|
|
|
Section 2.6.
|
Repayment of Loans
|
|
|
Section 2.7.
|
Prepayments
|
|
|
Section 2.8.
|
Late Charges
|
|
|
Section 2.9.
|
Continuation
|
|
|
Section 2.10.
|
Conversion
|
|
|
Section 2.11.
|
Notes
|
|
|
Section 2.12.
|
Voluntary Reductions of the Revolving Commitment
|
|
|
Section 2.13.
|
Extension of Maturity Date
|
|
|
Section 2.14.
|
Expiration or Maturity Date of Letters of Credit Past Maturity Date
|
|
|
Section 2.15.
|
Amount Limitations
|
|
|
Section 2.16.
|
Funds Transfer Disbursements
|
|
|
Section 2.17.
|
Increase in Revolving Commitments
|
|
|
|
|
|
Article III.
|
Payments, Fees and Other General Provisions
|
|
|
Section 3.1.
|
Payments
|
|
|
Section 3.2.
|
Pro Rata Treatment
|
|
|
Section 3.3.
|
Sharing of Payments, Etc
|
|
|
Section 3.4.
|
Several Obligations
|
|
|
Section 3.5.
|
Fees
|
|
|
Section 3.6.
|
Computations
|
|
|
Section 3.7.
|
Usury
|
|
|
Section 3.8.
|
Statements of Account
|
|
|
Section 3.9.
|
Defaulting Lenders
|
|
|
Section 3.10.
|
Taxes; Foreign Lenders
|
|
|
|
|
|
|
Article IV.
|
[Reserved]
|
|
|
|
|
|
|
Article V.
|
Yield Protection, Etc.
|
|
|
Section 5.1.
|
Additional Costs; Capital Adequacy
|
|
|
Section 5.2.
|
Suspension of LIBOR Loans
|
|
|
Section 5.3.
|
Illegality
|
|
|
Section 5.4.
|
Compensation
|
|
|
Section 5.5.
|
Treatment of Affected Loans
|
|
|
Section 5.6.
|
Affected Lenders
|
|
|
|
|
|
|
|
|
Section 5.7.
|
Change of Lending Office
|
|
|
Section 5.8.
|
Assumptions Concerning Funding of LIBOR Loans.
|
|
|
|
|
|
Article VI.
|
Conditions Precedent
|
|
|
Section 6.1.
|
Initial Conditions Precedent.
|
|
|
Section 6.2.
|
Conditions Precedent to All Loans and Letters of Credit.
|
|
|
Section 6.3.
|
Conditions as Covenants.
|
|
|
|
|
|
Article VII.
|
Representations and Warranties
|
|
|
Section 7.1.
|
Representations and Warranties
|
|
|
Section 7.2.
|
Survival of Representations and Warranties, Etc.
|
|
|
|
|
|
|
Article VIII.
|
Affirmative Covenants
|
|
|
Section 8.1.
|
Preservation of Existence and Similar Matters.
|
|
|
Section 8.2.
|
Compliance with Applicable Law.
|
|
|
Section 8.3.
|
Maintenance of Property.
|
|
|
Section 8.4.
|
Conduct of Business.
|
|
|
Section 8.5.
|
Insurance.
|
|
|
Section 8.6.
|
Payment of Taxes and Claims.
|
|
|
Section 8.7.
|
Books and Records; Inspections.
|
|
|
Section 8.8.
|
Use of Proceeds.
|
|
|
Section 8.9.
|
Environmental Matters.
|
|
|
Section 8.10.
|
Further Assurances.
|
|
|
Section 8.11.
|
Material Contracts.
|
|
|
Section 8.12.
|
REIT Status.
|
|
|
Section 8.13.
|
Exchange Listing.
|
|
|
Section 8.14.
|
Guarantors.
|
|
|
|
|
|
Article IX.
|
Information
|
|
|
Section 9.1.
|
Quarterly Financial Statements.
|
|
|
Section 9.2.
|
Year-End Statements.
|
|
|
Section 9.3.
|
Compliance Certificate.
|
|
|
Section 9.4.
|
Other Information.
|
|
|
Section 9.5.
|
Electronic Delivery of Certain Information.
|
|
|
Section 9.6.
|
Public/Private Information.
|
|
|
Section 9.7.
|
USA Patriot Act Notice; Compliance.
|
|
|
|
|
|
|
Article X.
|
Negative Covenants
|
|
|
Section 10.1.
|
Financial Covenants
|
|
|
Section 10.2.
|
Negative Pledge
|
|
|
Section 10.3.
|
Restrictions on Intercompany Transfers
|
|
|
Section 10.4.
|
Merger, Consolidation, Sales of Assets and Other Arrangements
|
|
|
Section 10.5.
|
Plans
|
|
|
Section 10.6.
|
Fiscal Year
|
|
|
Section 10.7.
|
Modifications of Organizational Documents and Material Contracts
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Section 10.8.
|
Subordinated Debt Prepayments; Amendments
|
|
|
Section 10.9.
|
Transactions with Affiliates
|
|
|
Section 10.10.
|
Environmental Matters
|
|
|
Section 10.11.
|
Derivatives Contracts
|
|
|
|
|
|
|
Article XI.
|
Default
|
|
|
Section 11.1.
|
Events of Default
|
|
|
Section 11.2.
|
Remedies Upon Event of Default
|
|
|
Section 11.3.
|
Remedies Upon Default
|
|
|
Section 11.4.
|
Marshaling; Payments Set Aside
|
|
|
Section 11.5.
|
Allocation of Proceeds
|
|
|
Section 11.6.
|
Letter of Credit Collateral Account
|
|
|
Section 11.7.
|
Reserved
|
|
|
Section 11.8.
|
Performance by Administrative Agent
|
|
|
Section 11.9.
|
Rights Cumulative
|
|
|
|
|
|
|
Article XII.
|
The Administrative Agent
|
|
|
Section 12.1.
|
Appointment and Authorization
|
|
|
Section 12.2.
|
Wells Fargo as Lender
|
|
|
Section 12.3.
|
Approvals of Lenders
|
|
|
Section 12.4.
|
Notice of Events of Default
|
|
|
Section 12.5.
|
Administrative Agent's Reliance
|
|
|
Section 12.6.
|
Indemnification of Administrative Agent
|
|
|
Section 12.7.
|
Lender Credit Decision, Etc.
|
|
|
Section 12.8.
|
Successor Administrative Agent
|
|
|
Section 12.9.
|
Titled Agents
|
|
|
|
|
|
|
Article XIII.
|
Miscellaneous
|
|
|
Section 13.1.
|
Notices
|
|
|
Section 13.2.
|
Expenses
|
|
|
Section 13.3.
|
Stamp, Intangible and Recording Taxes
|
|
|
Section 13.4.
|
Setoff
|
|
|
Section 13.5.
|
Litigation; Jurisdiction; Other Matters; Waivers
|
|
|
Section 13.6.
|
Successors and Assigns
|
|
|
Section 13.7.
|
Amendments and Waivers
|
|
|
Section 13.8.
|
Non-Liability of Administrative Agent and Lenders
|
|
|
Section 13.9.
|
Confidentiality
|
|
|
Section 13.10.
|
Indemnification
|
|
|
Section 13.11.
|
Termination; Survival
|
|
|
Section 13.12.
|
Severability of Provisions
|
|
|
Section 13.13.
|
GOVERNING LAW
|
|
|
Section 13.14.
|
Counterparts
|
|
|
Section 13.15.
|
Obligations with Respect to Loan Parties
|
|
|
Section 13.16.
|
Independence of Covenants
|
|
|
Section 13.17.
|
Limitation of Liability
|
|
|
Section 13.18.
|
Entire Agreement
|
|
|
Section 13.19.
|
Construction, Conflict of Terms
|
|
|
|
|
|
|
|
|
|
|
|
|
Section 13.20.
|
Headings
|
|
|
Section 13.21.
|
Limitation of Liability of Borrower's General Partner
|
|
|
Section 13.22.
|
Limited Nature of Parent's Obligations
|
|
|
Section 13.23.
|
Limitation of Liability of Borrower's Directors, Officers, Etc
|
|
|
Section 13.24.
|
AMENDMENT, RESTATEMENT AND CONSOLIDATION; NO NOVATION.
|
|
|
|
|
|
SCHEDULE I
|
Commitments
|
SCHEDULE 1.1.
|
Liens
|
SCHEDULE 7.1.(b)
|
Ownership Structure
|
SCHEDULE 7.1.(f)
|
Occupancy Status of Properties
|
SCHEDULE 7.1.(h)
|
Material Contracts
|
SCHEDULE 7.1.(i)
|
Litigation
|
SCHEDULE 7.1.(r)
|
Affiliate Transactions
|
SCHEDULE 8.14.(c)
|
Parent Guaranties of Indebtedness
|
|
|
|
EXHIBIT A
|
Form of Assignment and Assumption Agreement
|
EXHIBIT B
|
Form of Amended and Restated Guaranty
|
EXHIBIT C
|
Form of Notice of Borrowing
|
EXHIBIT D
|
Form of Notice of Continuation
|
EXHIBIT E
|
Form of Notice of Conversion
|
EXHIBIT F
|
Form of Notice of Swingline Borrowing
|
EXHIBIT G
|
Form of Amended and Restated Parent Guaranty
|
EXHIBIT H
|
Form of Amended and Restated Revolving Note
|
EXHIBIT I
|
Form of Swingline Note
|
EXHIBIT J
|
Form of Transfer Authorizer Designation Form
|
EXHIBIT K
|
Form of Compliance Certificate
|
THIS THIRD AMENDED AND RESTATED CREDIT AGREEMENT (this “Agreement”) dated as of November 13, 2012 by and among CBL & ASSOCIATES LIMITED PARTNERSHIP, a limited partnership organized under the laws of the State of Delaware (the “Borrower”), CBL & ASSOCIATES PROPERTIES, INC., a corporation organized under the laws of the State of Delaware (the “Parent”), joining in the execution of this Agreement solely for the limited purposes set forth in Section 13.22., each of the financial institutions initially a signatory hereto together with their successors and assignees under Section 13.6. (the “Lenders”), WELLS FARGO BANK, NATIONAL ASSOCIATION (“Administrative Agent”) and U.S. BANK NATIONAL ASSOCIATION, as Syndication Agent (“Syndication Agent”) and BANK OF AMERICA, N.A., KEYBANK, NATIONAL ASSOCIATION, JPMORGAN CHASE BANK, N.A. and PNC BANK, NATIONAL ASSOCIATION, each as Documentation Agent (each a “Documentation Agent”).
WHEREAS, the Lenders have made available to the Borrower a revolving credit facility on the terms and conditions contained in that certain Second Amended and Restated Credit Agreement dated as of November 2, 2009 (as amended and in effect immediately prior to the date hereof, the “Existing Credit Agreement”) by and among the Borrower, Parent, Lenders, and Wells Fargo Bank, National Association, as Administrative Agent;
WHEREAS, the Administrative Agent and the Lenders desire to amend and restate the Existing Credit Agreement in order to make available to the Borrower a $600,000,000 unsecured revolving credit facility, which will include a letter of credit subfacility and a swingline subfacility, on the terms and conditions contained herein.
NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged by the parties hereto, the parties hereto agree that the Existing Credit Agreement is amended and restated in its entirety as follows:
Article I. Definitions
Section 1.1.
Definitions.
In addition to terms defined elsewhere herein, the following terms shall have the following meanings for the purposes of this Agreement:
“
Accession Agreement
” means a Guaranty Supplement substantially in the form of Annex I to the Guaranty.
“
Additional Costs
” has the meaning given that term in Section 5.1.(b).
“
Adjusted Total Asset Value
”
means Total Asset Value determined exclusive of assets that are owned by Excluded Subsidiaries or Unconsolidated Affiliates.
“
Administrative Agent
” means Wells Fargo Bank, National Association, as contractual representative of the Lenders under this Agreement, or any successor Administrative Agent appointed pursuant to Section 12.8.
“
Administrative Questionnaire
” means the Administrative Questionnaire completed by each Lender and delivered to the Administrative Agent in a form supplied by the Administrative Agent to the Lenders from time to time.
“
Affected Lender
” has the meaning given that term in Section 5.6.
“
Affiliate
” means, with respect to any Person, (a) in the case of any such Person which is a partnership or limited liability company, any partner or member in such partnership or limited liability company, respectively, (b) any other Person which is directly or indirectly controlled by, controls or is under common control with such Person or one or more of the Persons referred to in the preceding clause (a), (c) any other Person who is an officer, director, trustee or employee of, or partner in, such Person or any Person referred to in the preceding clauses (a) and (b), (d) any other Person who is a member of the immediate family of such Person or of any Person referred to in the preceding clauses (a) through (c), and (e) any other Person that is a trust solely for the benefit of one or more Persons referred to in clause (d) and of which such Person is sole trustee;
provided
,
however
, in no event shall the Administrative Agent, the Issuing Bank or any Lender or any of its or their respective Affiliates be an Affiliate of Borrower, Parent or any other Loan Party. For purposes of this definition, “control” (including with correlative meanings, the terms “controlling”, “controlled by” and “under common control with”) means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a Person, whether through the ownership of voting securities, by contract or otherwise. The Affiliates of a Person shall include any officer or director of such Person. In no event shall the Administrative Agent, the Issuing Bank or any Lender be deemed to be an Affiliate of the Borrower, Parent or any other Loan Party.
“
Agreement Date
” means the date as of which this Agreement is dated.
“
Applicable Facility Fee
” means the percentage set forth in the table below corresponding to the Level at which the “Applicable Margin” is determined in accordance with the definition thereof upon the occurrence of a Credit Rating Election Event:
|
|
|
Level
|
Facility Fee
|
1
|
0.15%
|
2
|
0.175%
|
3
|
0.225%
|
4
|
0.3%
|
5
|
0.35%
|
Any change in the applicable Level at which the Applicable Margin is determined shall result in a corresponding and simultaneous change in the Applicable Facility Fee. The provisions of this definition shall be subject to Section 2.4.(d).
“
Applicable Law
” means all applicable provisions of constitutions, statutes, treaties, rules, guidelines, administrative or judicial precedents or authorities, regulations and orders of any Governmental Authority, including all orders and decrees of all courts, tribunals and arbitrators.
“
Applicable Margin
” means the percentage rate set forth below corresponding to the ratio of Total Indebtedness to Total Asset Value as determined in accordance with Section 10.1.(b):
|
|
|
|
Level
|
Ratio of Total Indebtedness to Total Asset Value
|
Applicable Margin
|
1
|
Less than 0.45 to 1.00
|
1.55%
|
2
|
Greater than or equal to 0.45 to 1.00 but less than 0.50 to 1.00
|
1.7%
|
3
|
Greater than or equal to 0.50 to 1.00 but less than 0.55 to 1.00
|
1.85%
|
4
|
Greater than or equal to 0.55 to 1.00
|
2.1%
|
The Applicable Margin for Loans shall be determined by the Administrative Agent from time to time, based on the ratio of Total Indebtedness to Total Asset Value as set forth in the Compliance Certificate most recently delivered by the Borrower pursuant to Section 9.3. Any adjustment to the Applicable Margin shall be effective as of the first day of the calendar month immediately following the month during which the Borrower delivers to the Administrative Agent the applicable Compliance Certificate pursuant to Section 9.3.; provided however, if the date for delivery of the Compliance Certificate falls on a day that is not a Business Day, and the Compliance Certificate is delivered on the next Business Day occurring thereafter and such Business Day is in the month following the month in which the due date occurs, the adjustment to the Applicable Margin shall be effective as of the date the Compliance Certificate is delivered. If the Borrower fails to deliver a Compliance Certificate pursuant to Section 9.3., and does not cure such failure within ten (10) days after notice from the Administrative Agent (which notice may be given to the Executive Vice President - Chief Financial Officer by email or telephone), the Applicable Margin shall equal the percentages corresponding to Level 4 until the first day of the calendar month immediately following the month that the required Compliance Certificate is delivered. Notwithstanding the foregoing, for the period from the Effective Date through but excluding the date on which the Administrative Agent first determines the Applicable Margin for Loans as set forth above, the Applicable Margin shall be determined based on Level 3. Thereafter, such Applicable Margin shall be adjusted from time to time as set forth in this definition. The provisions of this definition shall be subject to Section 2.4.(d).
Upon the occurrence of a Credit Rating Election Event and thereafter, the Applicable Margin shall mean the percentage rate set forth in the table below corresponding to the level (each, a “Level”) into which the Borrower's Credit Rating then falls:
|
|
|
|
Level
|
Credit Rating
|
Applicable Margin
|
1
|
A-/A3 or better
|
1.000%
|
2
|
BBB+/Baa1
|
1.075%
|
3
|
BBB/Baa2
|
1.175%
|
|
|
|
|
|
|
4
|
|
BBB-/Baa3
|
1.400
|
%
|
5
|
|
Lower than BBB-/Baa3
|
1.750
|
%
|
Any change in the Borrower's Credit Rating which would cause it to move to a different Level shall be effective as of the first day of the first calendar month immediately following receipt by the Administrative Agent of written notice delivered by the Borrower in accordance with Section 9.4.(l) that the Borrower's Credit Rating has changed; provided, however, if the Borrower has not delivered the notice required by such Section but the Administrative Agent becomes aware that the Borrower's Credit Rating has changed, then the Administrative Agent may, in its sole discretion, adjust the Level effective as of the first day of the first calendar month following the date the Administrative Agent becomes aware that the Borrower's Credit Rating has changed. During any period that the Borrower has received two (2) Credit Ratings that are not equivalent, the Applicable Margin shall be determined based on the Level corresponding to the higher of such two (2) Credit Ratings. During any period for which the Borrower 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 the Borrower has not received a Credit Rating from any Rating Agency, and provided a Credit Rating Election Event has occurred, the Applicable Margin shall be determined based on Level 5. The provisions of this definition shall be subject to Section 2.4.(d).
“
Approved Fund
” means any Fund that is administered or managed by (a) a Lender, (b) an Affiliate of a Lender, or (c) an entity or an Affiliate of any entity that administers or manages a Lender.
“
Assignment and Assumption
” means an Assignment and Assumption Agreement among a Lender, an Eligible Assignee and the Administrative Agent, substantially in the form of
Exhibit A
.
“
Bankruptcy Code
” means the Bankruptcy Code of 1978, as amended.
“
Base Rate
” means the LIBOR Market Index Rate; provided, that if for any reason the LIBOR Market Index Rate is unavailable, Base Rate shall mean the per annum rate of interest equal to the Federal Funds Rate plus one and one-half of one percent (1.50%).
“
Base Rate Loan
” means a Loan bearing interest at a rate based on the Base Rate.
“
Benefit Arrangement
” means at any time an employee benefit plan within the meaning of Section 3(3) of ERISA which is not a Plan or a Multiemployer Plan and which is maintained or otherwise contributed to by any member of the ERISA Group.
“
Borrower
” has the meaning set forth in the introductory paragraph hereof and shall include the Borrower's successors and permitted assigns.
“
Borrower Information
” has the meaning given that term in Section 2.4.(d).
“
Business Day
” means (i) a day of the week (but not a Saturday, Sunday or holiday) on which the offices of the Administrative Agent in Minneapolis, Minnesota are open to the public for carrying on substantially all of the Administrative Agent's business functions, and (ii) if such day relates to a LIBOR
Loan, any such day that is also a day on which dealings in Dollars are carried on in the London interbank market. Unless specifically referenced in this Agreement as a Business Day, all references to “days” shall be to calendar days.
“
Capitalization Rate
” means seven and one-half of one percent (7.5%).
“
Capitalized Lease Obligations
” means obligations under a lease (or other arrangement conveying the right to use) to pay rent or other amounts, in each case that are required to be capitalized for financial reporting purposes in accordance with GAAP. The amount of a Capitalized Lease Obligation is the capitalized amount of such obligation as would be required to be reflected on a balance sheet of the applicable Person prepared in accordance with GAAP as of the applicable date.
“
Capital Reserves
” means, for any period and with respect to any Property, an amount equal to (a) the aggregate square footage of all completed space of such Property owned by the Borrower or any of its Subsidiaries
times
(b) $0.20
times
(c) the number of days in such period divided by (d) 365. If the term Capital Reserves is used without reference to any specific Property, then it shall be determined on an aggregate basis with respect to all Properties and the applicable Ownership Shares of all Properties of all Unconsolidated Affiliates.
“
Cash Collateralize
” means, to pledge and deposit with or deliver to the Administrative Agent, for the benefit of the Issuing Bank or the Lenders, as collateral for Letter of Credit Liabilities or obligations of Lenders to fund participations in respect of Letter of Credit Liabilities, cash or deposit account balances or, if the Administrative Agent and the
Issuing Bank shall agree in their sole discretion, other credit support, in each case pursuant to documentation in form and substance satisfactory to the Administrative Agent and the Issuing Bank. “Cash Collateral” shall have a meaning correlative to the foregoing and shall include the proceeds of such cash collateral and other credit support.
“
Cash Equivalents
” means: (a) securities issued, guaranteed or insured by the United States of America or any of its agencies with maturities of not more than one year from the date acquired; (b) certificates of deposit with maturities of not more than one year from the date acquired issued by a United States federal or state chartered commercial bank of recognized standing, or a commercial bank organized under the laws of any other country which is a member of the Organisation for Economic Cooperation and Development, or a political subdivision of any such country, acting through a branch or agency, which bank has capital and unimpaired surplus in excess of $500,000,000 and which bank or its holding company has a short-term commercial paper rating of at least A-2 or the equivalent by S&P or at least P-2 or the equivalent by Moody's; (c) reverse repurchase agreements with terms of not more than seven days from the date acquired, for securities of the type described in clause (a) above and entered into only with commercial banks having the qualifications described in clause (b) above; (d) commercial paper issued by any Person incorporated under the laws of the United States of America or any State thereof and rated at least A-2 or the equivalent thereof by S&P or at least P-2 or the equivalent thereof by Moody's, in each case with maturities of not more than one year from the date acquired; and (e) investments in money market funds registered under the Investment Company Act of 1940, as amended, which have net assets of at least $500,000,000 and at least eighty-five percent (85%) of whose assets consist of securities and other obligations of the type described in clauses (a) through (d) above.
“
Co-Lead Arrangers
” means each of Wells Fargo Securities, LLC and U.S. Bank National Association, in such capacity, together with their respective successors and assigns.
“
Commitment
” means a Revolving Commitment in an aggregate amount up to, but not exceeding the amount set forth for such Lender on
Schedule I
hereto as such Lender's respective
“Revolving Commitment Amount” (as the same may be reduced from time to time pursuant to Section 2.12. or otherwise pursuant to the terms of this Agreement).
“
Compliance Certificate
” has the meaning given that term in Section 9.3.
“
Continue
”, “
Continuation
” and “
Continued
” each refers to the continuation of a LIBOR Loan from one Interest Period to another Interest Period pursuant to Section 2.9.
“
Convert
”, “
Conversion
” and “
Converted
” each refers to the conversion of a Loan of one Type into a Loan of another Type pursuant to Section 2.10.
“
Credit Event
” means any of the following: (a) the making (or deemed making) of any Loan, (b) the Conversion of a Loan, (c) the Continuation of a LIBOR Loan and (d) the issuance of a Letter of Credit.
“
Credit Rating
” means the rating assigned by a Rating Agency to the senior unsecured long term Indebtedness of a Person.
“
Credit Rating Election Event
” has the meaning given that term in Section 2.4.(b).
“
Debtor Relief Laws
” means the Bankruptcy Code, and all other liquidation, conservatorship, bankruptcy, assignment for the benefit of creditors, moratorium, rearrangement, receivership, insolvency, reorganization, or similar Applicable Laws relating to the relief of debtors in the United States of America or other applicable jurisdictions from time to time in effect.
“
Default
” means any of the events specified in Section 11.1., whether or not there has been satisfied any requirement for the giving of notice, the lapse of time, or both.
“
Defaulting Lender
” means, subject to Section 3.9.(f), any Lender that (a) has failed to (i) fund all or any portion of its Loans within two (2) Business Days of the date such Loans were required to be funded hereunder unless such Lender notifies the Administrative Agent and the Borrower in writing that such failure is the result of such Lender's determination that one or more conditions precedent to funding (each of which conditions precedent, together with any applicable default, shall be specifically identified in such writing) has not been satisfied, or (ii) pay to the Administrative Agent, the Issuing Bank, the Swingline Lender or any other Lender any other amount required to be paid by it hereunder (including in respect of its participation in Letters of Credit or Swingline Loans) within two (2) Business Days of the date when due, (b) has notified the Borrower, the Administrative Agent, the Issuing Bank or the Swingline Lender in writing that it does not intend to comply with its funding obligations hereunder, or has made a public statement to that effect (unless such writing or public statement relates to such Lender's obligation to fund a Loan hereunder and states that such position is based on such Lender's determination that a condition precedent to funding (which condition precedent, together with any applicable default, shall be specifically identified in such writing or public statement) cannot be satisfied), (c) has failed, within three (3) Business Days after written request by the Administrative Agent or the Borrower, to confirm in writing to the Administrative Agent and the Borrower that it will comply with its prospective funding obligations hereunder (provided that such Lender shall cease to be a Defaulting Lender pursuant to this clause (c) upon receipt of such written confirmation by the Administrative Agent and the Borrower), or (d) has, or has a direct or indirect parent company that has, (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; 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 Administrative Agent that a Lender is a Defaulting Lender under clauses (a) through (d) above shall be conclusive and binding absent manifest error, and such Lender shall be deemed to be a Defaulting Lender (subject to Section 3.9.(f)) upon delivery of written notice of such determination to the Borrower, the Issuing Bank, the Swingline Lender and each Lender.
“
Derivatives Contract
” : means (a) any transaction (including any master agreement, confirmation or other agreement with respect to any such transaction) now existing or hereafter entered into by the Parent, the Borrower or any of their respective Subsidiaries (i) which is a rate swap transaction, swap option, basis swap, forward rate transaction, commodity swap, commodity option, equity or equity index swap, equity or equity index option, bond option, interest rate option, foreign exchange transaction, cap transaction, floor transaction, collar transaction, currency swap transaction, cross-currency rate swap transaction, currency option, credit protection transaction, credit swap, credit default swap, credit default option, total return swap, credit spread transaction, repurchase transaction, reverse repurchase transaction, buy/sell-back transaction, securities lending transaction, weather index transaction or forward purchase or sale of a security, commodity or other financial instrument or interest (including any option with respect to any of these transactions) or (ii) which is a type of transaction that is similar to any transaction referred to in clause (i) above that is currently, or in the future becomes, recurrently entered into in the financial markets (including terms and conditions incorporated by reference in such agreement) and which is a forward, swap, future, option or other derivative on one or more rates, currencies, commodities, equity securities or other equity instruments, debt securities or other debt instruments, economic indices or measures of economic risk or value, or other benchmarks against which payments or deliveries are to be made, and (b) any combination of these transactions.
“
Derivatives Support Document
” means (i) any Credit Support Annex comprising part of (and as defined in) any Specified Derivatives Contract, and (ii) any document or agreement pursuant to which cash, deposit accounts, securities accounts or similar financial asset collateral are pledged to or made available for setoff by, a Specified Derivatives Provider, including any banker's lien or similar right, securing or supporting Specified Derivatives Obligation.
“
Derivatives Termination Value
” means, in respect of any one or more Derivatives Contracts, after taking into account the effect of any legally enforceable netting agreement or provision relating thereto, (a) for any date on or after the date such Derivatives Contracts have been terminated or closed out, the termination amount or value determined in accordance therewith, and (b) for any date prior to the date such Derivatives Contracts have been terminated or closed out, the then-current mark-to-market value for such Derivatives Contracts, determined based upon one or more mid-market quotations or estimates provided by any recognized dealer in Derivatives Contracts (which may include the Administrative Agent, any Lender, any Specified Derivatives Provider or any Affiliate of any thereof).
“
Development Property
” means a Property currently under development that has not achieved an Occupancy Rate of eighty-five percent (85%) or more or, subject to the last sentence of this definition, on which the improvements (other than tenant improvements on unoccupied space) related to the development have not been completed. The term “Development Property” shall include real property of
the type described in the immediately preceding sentence that satisfies both of the following conditions: (i) it is to be (but has not yet been) acquired by the Borrower, any Subsidiary or any Unconsolidated Affiliate upon completion of construction pursuant to a contract in which the seller of such real property is required to develop or renovate prior to, and as a condition precedent to, such acquisition and (ii) a third party is developing such property using the proceeds of a loan that is Guaranteed by, or is otherwise recourse to, the Parent, the Borrower, any Subsidiary or any Unconsolidated Affiliate. A Development Property on which all improvements (other than tenant improvements on unoccupied space) related to the development of such Property have been completed for at least fifteen (15) months shall cease to constitute a Development Property notwithstanding the fact that such Property has not achieved an Occupancy Rate of at least eighty-five percent (85%).
“
Dollars
” or “
$
” means the lawful currency of the United States of America.
“
EBITDA
” means, with respect to a Person, for any period and without duplication, the sum of (a) net income (loss) of such Person for such period determined on a consolidated basis excluding the following (but only to the extent included in determining net income (loss) for such period): (i) depreciation and amortization expense (less depreciation and amortization expense allocable to non-controlling interest in Subsidiaries of the Borrower for such period); (ii) interest expense; (iii) income tax expense; (iv) extraordinary or nonrecurring items, including without limitation, gains and losses from the sale of operating Properties; and (v) equity in net income (loss) of its Unconsolidated Affiliates
plus
(b) such Person's Ownership Share of EBITDA of Unconsolidated Affiliates for such period. EBITDA shall be adjusted to remove any impact from straight line rent leveling adjustments required under GAAP and amortization of intangibles pursuant to FASB ASC 805. For purposes of this definition, nonrecurring items shall be deemed to include (v) abandoned projects, (w) impairments and other non-cash charges, (x) gains and losses on early extinguishment of Indebtedness, (y) cash or non-cash severance and other non-cash restructuring charges and (z) transaction costs of acquisitions not permitted to be capitalized pursuant to GAAP.
“
Effective Date
” means the later of (a) the Agreement Date and (b) the date on which all of the conditions precedent set forth in Section 6.1. shall have been fulfilled or waived in accordance with the provisions of Section 13.7.
“
Eligible Assignee
” means (a) a Lender, (b) an Affiliate of a Lender, (c) an Approved Fund and (d) any other Person (other than a natural person) approved by (i) the Administrative Agent and (ii) unless a Default or Event of Default exists, the Borrower (each such approval not to be unreasonably withheld or delayed); provided that notwithstanding the foregoing, “Eligible Assignee” shall not include the Borrower or any of the Borrower's Affiliates or Subsidiaries or any Defaulting Lender or its Affiliates.
“
Eligible Property
” means a Property which satisfies all of the following requirements as confirmed by the Administrative Agent: (a) such Property is wholly owned in fee simple (or with the consent of the Requisite Lenders, leased under a Ground Lease) by the Borrower or a Wholly Owned Subsidiary (which Subsidiary shall be a Guarantor unless Guarantors shall have been released pursuant to the provisions of the second sentence of Section 8.14.(b) or shall be the Management Company or any Wholly Owned Subsidiary of the Management Company); (b) such Property is located in a State of the United States of America or in the District of Columbia; (c) neither such Property, nor any interest of the Borrower or any Subsidiary therein, nor, if such Property is owned by a Subsidiary, any of the Borrower's direct or indirect ownership interest in such Subsidiary, is subject to (i) any Lien other than Permitted Liens (but not Permitted Liens described in clause (g) of the definition of that term) or (ii) any Negative Pledge; (d) regardless of whether such Property is owned (or with the consent of the Requisite Lenders,
leased under a Ground Lease) by the Borrower or a Wholly Owned Subsidiary, the Borrower has the right directly, or indirectly through a Wholly Owned Subsidiary, to take the following actions without the need to obtain the consent of any Person: (i) to create Liens on such Property as security for Indebtedness of the Borrower or such Subsidiary, as applicable, and (ii) to sell, transfer or otherwise dispose of such Property; and (e) to Borrower's knowledge, such Property is free of all structural defects or major architectural deficiencies, title defects, environmental conditions or other adverse matters except for defects, deficiencies, conditions or other matters individually or collectively which are not material to the profitable operation of such Property. The initial list of Eligible Properties shall be provided by the Borrower to the Administrative Agent and the Lenders on the Agreement Date in the Officer's Certificate. For the avoidance of doubt, no Property owned or leased by an Excluded Subsidiary (other than the Management Company or any Wholly Owned Subsidiary of the Management Company) shall be an “Eligible Property” hereunder.
“
Environmental Laws
” means any Applicable Law relating to environmental protection or the manufacture, storage, remediation, disposal or clean-up of Hazardous Materials including, without limitation, the following: Clean Air Act, 42 U.S.C. § 7401 et seq.; Federal Water Pollution Control Act, 33 U.S.C. § 1251 et seq.; Solid Waste Disposal Act, as amended by the Resource Conservation and Recovery Act, 42 U.S.C. § 6901 et seq.; Comprehensive Environmental Response, Compensation and Liability Act, 42 U.S.C. § 9601 et seq.; National Environmental Policy Act, 42 U.S.C. § 4321 et seq.; regulations of the Environmental Protection Agency, any applicable rule of common law and any judicial interpretation thereof relating primarily to the environment or Hazardous Materials, and any analogous or comparable state or local laws, regulations or ordinances that concern Hazardous Materials or protection of the environment.
“
Equity Interest
” means, 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, whether or not certificated, 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 non-voting, and whether or not such share, warrant, option, right or other interest is authorized or otherwise existing on any date of determination.
“
Equity Issuance
” means any issuance or sale by a Person of any Equity Interest in such Person and shall in any event include the issuance of any Equity Interest upon the conversion or exchange of any security constituting Indebtedness that is convertible or exchangeable, or is being converted or exchanged, for Equity Interests.
“
ERISA
” means the Employee Retirement Income Security Act of 1974, as amended.
“
ERISA Group
” means the Borrower, any Subsidiary and all members of a controlled group of corporations and all trades or businesses (whether or not incorporated) under common control which, together with the Borrower or any Subsidiary, are treated as a single employer under Section 414 of the Internal Revenue Code.
“
Event of Default
” means any of the events specified in Section 11.1., provided that any requirement for notice or lapse of time or any other condition has been satisfied.
“
Excluded Subsidiary
” means (a) any Subsidiary of the Borrower that (x)(i) holds title to assets that are or are to become collateral for any Secured Indebtedness of such Subsidiary or (ii) owns, directly or indirectly, any Equity Interests in a Subsidiary or Unconsolidated Affiliate holding title to assets that are or are to become collateral for any Secured Indebtedness of such Subsidiary or Unconsolidated Affiliate and (y) in the case of any such Subsidiary under clause (a)(x)(ii), (1) is prohibited from Guaranteeing the Indebtedness of any other Person pursuant to (i) any document, instrument or agreement evidencing such Secured Indebtedness or (ii) a provision of such Subsidiary's organizational documents, which was included in such Subsidiary's organizational documents as a condition to the incurrence of such Secured Indebtedness or (2) does not own any Specified Equity Interests, (b) any Subsidiary of the Borrower (other than a Wholly Owned Subsidiary of the Borrower) that is prohibited from Guaranteeing the Indebtedness of any other Person pursuant to a provision of such Subsidiary's organizational documents as in effect as of the Agreement Date, (c) Hamilton Insurance Company, LLC, Chattanooga Insurance Company, Ltd., and DM Cayman II, Inc., in each case solely to the extent such Subsidiary continues to be in the business of insurance services of the type in which it is engaged as of the Agreement Date, (d) the Management Company and any of its Wholly Owned Subsidiaries and (e) Arbor Place Limited Partnership, The Galleria Associates, L.P., Oak Park Holding I, LLC, CBL/MS General Partnership, Montgomery Partners, L.P., Jarnigan Road Limited Partnership, Laurel Park Retail Holding LLC, OK City Member, LLC, CW Joint Venture, LLC, CBL SubREIT, Inc., Foothills Mall Associates, LP and The Pavilion at Port Orange, LLC, in each case solely for so long as such Subsidiary would have adverse tax consequences to any owner (either direct or indirect) of its Equity Interests were it not designated an “Excluded Subsidiary” hereunder. The initial list of Excluded Subsidiaries shall be provided by the Borrower to the Administrative Agent and the Lenders on the Agreement Date in the Officer's Certificate.
“
Existing Credit Agreement
” has the meaning given that term in the first “WHEREAS” clause of this Agreement.
“
Fair Market Value
” means, (a) with respect to a security listed on a national securities exchange or the NASDAQ National Market, the price of such security as reported on such exchange or market by any widely recognized reporting method customarily relied upon by financial institutions and (b) with respect to any other property, the price which could be negotiated in an arm's-length free market transaction, for cash, between a willing seller and a willing buyer, neither of which is under pressure or compulsion to complete the transaction. Except as otherwise provided herein, Fair Market Value shall be determined by the Board of Directors of the Parent (or an authorized committee thereof) acting in good faith conclusively evidenced by a board resolution thereof delivered to the Administrative Agent or, with respect to any asset valued at no more than $1,000,000, such determination may be made by the chief financial officer of the Parent evidenced by an officer's certificate delivered to the Administrative Agent, in either case such determination being subject to the Administrative Agent's review and reasonable approval.
“
Federal Funds Rate
” means, for any period, a fluctuating interest rate per annum equal for each day during such period to the weighted average of the rates on overnight Federal Funds transactions with members of the Federal Reserve System arranged by Federal Funds brokers, as published for such day (or, if such day is not a Business Day, for the next preceding Business Day) by the Federal Reserve Bank of New York, or, if such rate is not so published for any day which is a Business Day, the average of the quotations for such day on such transactions received by the Administrative Agent from three (3) Federal Funds brokers of recognized standing selected by the Administrative Agent.
“
Fee Letter
” means that certain fee letter dated as of November 1, 2012, by and between the Borrower and the Administrative Agent.
“
Fees
” means the fees and commissions provided for or referred to in Section 3.5. and any other fees payable by the Borrower hereunder, under any other Loan Document or under the Fee Letter.
“
Fixed Charges
” means, with respect to a Person and for a given period, without duplication, the sum of (a) the Interest Expense of such Person for such period,
plus
(b) the aggregate of all regularly scheduled principal payments on Indebtedness payable by such Person during such period (excluding balloon, bullet or similar payments of principal due upon the stated maturity of Indebtedness). The Parent's Ownership Share of the Fixed Charges of Unconsolidated Affiliates will be included when determining the Fixed Charges of the Parent.
“
Foreign Lender
” means any Lender that is organized under the laws of a jurisdiction other than that in which the Borrower is resident for tax purposes. For purposes of this definition, the United States of America, each State thereof and the District of Columbia shall be deemed to constitute a single jurisdiction.
“
Fronting Exposure
” means, at any time there is a Defaulting Lender, (a) with respect to the Issuing Bank, such Defaulting Lender's Revolving Commitment Percentage of the outstanding Letter of Credit Liabilities other than Letter of Credit Liabilities as to which such Defaulting Lender's participation obligation has been reallocated to other Lenders or Cash Collateralized in accordance with the terms hereof, and (b) with respect to the Swingline Lender, such Defaulting Lender's Revolving Commitment Percentage of outstanding Swingline Loans other than Swingline Loans as to which such Defaulting Lender's participation obligation has been reallocated to other Lenders.
“
Fund
” means any Person (other than a natural person) that is (or will be) engaged in making, purchasing, holding or otherwise investing in commercial loans and similar extensions of credit in the ordinary course of its business.
“
Funds From Operations
” means, with respect to a Person and for a given period, net income (computed in accordance with GAAP), excluding gains (or losses) on sales of operating properties, plus depreciation, amortization, and after adjustments for unconsolidated partnerships, joint ventures and minority interests. Adjustments for unconsolidated partnerships and joint ventures are calculated on the same basis. For purposes of this Agreement, Funds From Operations shall be calculated consistent with the definition of "Funds From Operations" as set forth in the Parent 's Form 10-Q for the second quarter of Fiscal Year 2012 as filed with the Securities and Exchange Commission, as such definition may be modified with the prior approval of Requisite Lenders.
“
GAAP
” means accounting principles generally accepted in the United States of America as set forth in the opinions and pronouncements of the Accounting Principles Board of the American Institute of Certified Public Accountants and statements and pronouncements of the Financial Accounting Standards Board or in such other statements by such other entity including, without limitation, the Securities and Exchange Commission, as may be approved by a significant segment of the accounting profession in the United States of America, which are applicable to the circumstances as of the date of determination.
“
General Partner
” means CBL Holdings I, Inc., a Delaware corporation, and a Wholly Owned Subsidiary of the Parent and the sole general partner of Borrower, and shall include the General Partner's successors and permitted assigns.
“
Governmental Approvals
” means all authorizations, consents, approvals, licenses and exemptions of, registrations and filings with, and reports to, all Governmental Authorities.
“
Governmental Authority
” means any national, state or local government (whether domestic or foreign), any political subdivision thereof or any other governmental, quasi-governmental, judicial, administrative, public or statutory instrumentality, authority, body, agency, bureau, commission, board, department or other entity that has the right to govern any of the parties to this Agreement (including, without limitation, the Federal Deposit Insurance Corporation, the Comptroller of the Currency or the Federal Reserve Board, any central bank or any comparable authority) or any arbitrator with authority to bind a party at law.
“
Ground Lease
” means a ground lease containing the following terms and conditions: (a) the right of the lessee to mortgage and encumber its interest in the leased property without the consent of the lessor; (b) the obligation of the lessor to give the holder of any mortgage Lien on such leased property written notice of any defaults on the part of the lessee and agreement of such lessor that such lease will not be terminated until such holder has had a reasonable opportunity to cure or complete foreclosures, and fails to do so; (c) reasonable transferability of the lessee's interest under such lease, including ability to sublease; and (d) such other rights customarily required by mortgagees making a loan secured by the interest of the holder of the leasehold estate demised pursuant to a ground lease.
“
Guarantors
” means, individually and collectively, as the context shall require: (i) the Parent, (ii) all Material Subsidiaries (other than Excluded Subsidiaries), (iii) any Subsidiary of the Borrower (other than an Excluded Subsidiary) that owns, directly or indirectly, any Equity Interests of any other Guarantor and (iv) any Subsidiary that elects to become a Guarantor.
“
Guaranty
”, “
Guaranteed
” or to “
Guarantee
” as applied to any obligation means and includes: (a) a guaranty (other than by endorsement of negotiable instruments for collection in the ordinary course of business), directly or indirectly, in any manner, of any part or all of such obligation, or (b) an agreement, direct or indirect, contingent or otherwise, and whether or not constituting a guaranty, the practical effect of which is to assure the payment or performance (or payment of damages in the event of non-performance) of any part or all of such obligation whether by: (i) the purchase of securities or obligations, (ii) the purchase, sale or lease (as lessee or lessor) of property or the purchase or sale of services primarily for the purpose of enabling the obligor with respect to such obligation to make any payment or performance (or payment of damages in the event of non-performance) of or on account of any part or all of such obligation, or to assure the owner of such obligation against loss, (iii) the supplying of funds to or in any other manner investing in the obligor with respect to such obligation, (iv) repayment of amounts drawn down by beneficiaries of letters of credit (including Letters of Credit), or (v) the supplying of funds to or investing in a Person on account of all or any part of such Person's obligation under a Guaranty of any obligation or indemnifying or holding harmless, in any way, such Person against any part or all of such obligation. As the context requires, “Guaranty” shall also mean each guaranty executed and delivered pursuant to Section 6.1. or 8.14. and substantially in the form of
Exhibit B
.
“
Hazardous Materials
” means all or any of the following: (a) substances that are defined or listed in, or otherwise classified pursuant to, any applicable Environmental Laws as “hazardous substances”, “hazardous materials”, “hazardous wastes”, “toxic substances” or any other formulation intended to define, list or classify substances by reason of deleterious properties such as ignitability, corrosivity, reactivity, carcinogenicity, reproductive toxicity, “TCLP” toxicity, or “EP toxicity”; (b) oil, petroleum or petroleum derived substances, natural gas, natural gas liquids or synthetic gas and drilling fluids, produced waters and other wastes associated with the exploration, development or production of
crude oil, natural gas or geothermal resources; (c) any flammable substances or explosives or any radioactive materials; (d) asbestos in any form; (e) toxic mold; and (f) electrical equipment which contains any oil or dielectric fluid containing levels of polychlorinated biphenyls in excess of fifty parts per million.
“
Indebtedness
” means, 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 or for the deferred purchase price of property or services (excluding trade debt incurred in the ordinary course of business); (b) all obligations of such Person, whether or not for money borrowed (i) represented by notes payable, or drafts accepted, in each case representing extensions of credit (but only to the extent of any outstanding balance), (ii) evidenced by bonds, debentures, notes or similar instruments (but only to the extent such debt is not otherwise included in Indebtedness), 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 for services rendered; (c) Capitalized Lease Obligations of such Person; (d) all reimbursement obligations (contingent or otherwise) of such Person under or in respect of 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 to purchase, redeem, retire, defease or otherwise make any payment in respect of any Mandatorily Redeemable Stock issued by such Person or any other Person, valued at the greater of its voluntary or involuntary liquidation preference plus accrued and unpaid dividends; (g) 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 (other than Mandatorily Redeemable Stock)); (h) net obligations under any Derivatives Contract not entered into as a hedge against then existing Indebtedness (which shall be deemed to have an amount equal to the Derivatives Termination Value thereof at such time but in no event shall be less than zero); (i) 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, voluntary bankruptcy, collusive involuntary bankruptcy and other similar customary exceptions to non-recourse liability); (j) 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 (k) such Person's Ownership Share of the Indebtedness of any Unconsolidated Affiliate of such Person. Indebtedness of any Person shall include Indebtedness of any partnership or joint venture in which such Person is a general partner or joint venturer to the extent of such Person's Ownership Share of such partnership or joint venture (except if such Indebtedness, or portion thereof, is recourse to such Person, in which case the greater of such Person's Ownership Share of such Indebtedness or the amount of the recourse portion of the Indebtedness shall be included as Indebtedness of such Person). All Loans and Letter of Credit Liabilities shall constitute Indebtedness of the Borrower.
“
Intellectual Property
” has the meaning given that term in Section 7.1.(s).
“
Interest Expense
” means, with respect to any Person, for any period, without duplication, (a) total interest expense of such Person (including, without limitation, capitalized interest not funded under a construction loan interest reserve account, interest expense attributable to Capitalized Lease Obligations, letter of credit fees, and interest expense with respect to any Indebtedness in respect of which such Person is wholly or partially liable whether pursuant to any repayment, interest carry, performance guaranty or
otherwise) determined on a consolidated basis in accordance with GAAP for such period, plus (b) such Person's Ownership Share of Interest Expense of Unconsolidated Affiliates for such period.
“
Interest Period
” means with respect to each LIBOR Loan, each period commencing on the date such LIBOR Loan is made, or in the case of the Continuation of a LIBOR Loan the last day of the preceding Interest Period for such Loan, and ending on the numerically corresponding day in the first, third or sixth calendar month thereafter, as the Borrower may select in a Notice of Borrowing, Notice of Continuation or Notice of Conversion, as the case may be, except that each Interest Period that commences on the last Business Day of a calendar month (or on any day for which there is no numerically corresponding day in the appropriate subsequent calendar month) shall end on the last Business Day of the appropriate subsequent calendar month. Notwithstanding the foregoing: (a) if any Interest Period would otherwise end after the Maturity Date, such Interest Period shall end on the Maturity Date and (b) each Interest Period that would otherwise end on a day which is not a Business Day shall end on the immediately following Business Day (or, if such immediately following Business Day falls in the next calendar month, on the immediately preceding Business Day).
“
Internal Revenue Code
” means the Internal Revenue Code of 1986, as amended.
“
Investment
” means, with respect to any Person, any acquisition or investment (whether or not of a controlling interest) by such Person, by means of any of the following: (a) the purchase or other acquisition of any Equity Interest in another Person, (b) a loan, advance or extension of credit to, capital contribution to, Guaranty of Indebtedness of, or purchase or other acquisition of any Indebtedness of, another Person, including any partnership or joint venture interest in such other Person, or (c) the purchase or other acquisition (in one transaction or a series of transactions) of assets of another Person that constitute the business or a division or operating unit of another Person. Any commitment to make an Investment in any other Person, as well as any option of another Person to require an Investment in such Person, shall constitute an Investment. Except as expressly provided otherwise, for purposes of determining compliance with any covenant contained in a Loan Document, the amount of any Investment shall be the amount actually invested, without adjustment for subsequent increases or decreases in the value of such Investment.
“
Investment Grade Rating
” means a Credit Rating of BBB-/Baa3 (or the equivalent) or higher from a Rating Agency.
“
Issuing Bank
” means Wells Fargo or, after written notice to Borrower, any other Lender, each in its capacity as an issuer of Letters of Credit pursuant to Section 2.2.
“
L/C Commitment Amount
” has the meaning given to that term in Section 2.2.(a).
“
L/C Disbursement
” has the meaning given to that term in Section 3.9.(b).
“
Lender
” means each financial institution from time to time party hereto as a “Lender”, together with its respective successors and permitted assigns, and, as the context requires, includes the Swingline Lender; provided, however, that the term “Lender”, except as otherwise expressly provided herein, shall not include any Lender (or its Affiliates) in its capacity as a Specified Derivatives Provider. With respect to matters requiring the consent or approval of all Lenders at any given time, all then existing Defaulting Lenders will be disregarded and excluded, and, for voting purposes only, “all Lenders” shall be deemed to mean “all Lenders other than Defaulting Lenders”.
“
Lending Office
” means, for each Lender and for each Type of Loan, the office of such Lender specified in such Lender's Administrative Questionnaire or in the applicable Assignment and Assumption, or such other office of such Lender as such Lender may notify the Administrative Agent in writing from time to time.
“
Letter of Credit
” has the meaning given that term in Section 2.2.(a).
“
Letter of Credit Collateral Account
” means a special deposit account maintained by the Administrative Agent, for the benefit of the Administrative Agent, the Issuing Bank and the Lenders, and under its sole dominion and control.
“
Letter of Credit Documents
” means, with respect to any Letter of Credit, collectively, any application therefor, any certificate or other document presented in connection with a drawing under such Letter of Credit and any other agreement, instrument or other document governing or providing for (a) the rights and obligations of the parties concerned or at risk with respect to such Letter of Credit or (b) any collateral security for any of such obligations.
“
Letter of Credit Liabilities
” means, without duplication, at any time and in respect of any Letter of Credit, the sum of (a) the Stated Amount of such Letter of Credit plus (b) the aggregate unpaid principal amount of all Reimbursement Obligations of the Borrower at such time due and payable in respect of all drawings made under such Letter of Credit. For purposes of this Agreement, a Lender (other than the Lender then acting as Issuing Bank) shall be deemed to hold a Letter of Credit Liability in an amount equal to its participation interest under Section 2.2. in the related Letter of Credit, and the Lender then acting as the Issuing Bank shall be deemed to hold a Letter of Credit Liability in an amount equal to its retained interest in the related Letter of Credit after giving effect to the acquisition by the Lenders (other than the Lender then acting as the Issuing Bank) of their participation interests under such Section.
“
Level
” has the meaning given that term in the definition of the term “Applicable Margin.”
“
LIBOR
” means, for the Interest Period for any LIBOR Loan, the rate of interest, rounded up to the nearest whole multiple of one-hundredth of one percent (0.01%), obtained by dividing (i) the rate of interest, rounded upward to the nearest whole multiple of one-hundredth of one percent (0.01%), referred to as the BBA (British Bankers' Association) LIBOR rate as set forth by any service selected by the Administrative Agent that has been nominated by the British Bankers' Association as an authorized information vendor for the purpose of displaying such rate for deposits in U.S. Dollars at approximately 11:00 a.m. Central time, two (2) Business Days prior to the date of commencement of such Interest Period for purposes of calculating effective rates of interest for loans or obligations making reference thereto, for an amount approximately equal to the applicable LIBOR Loan and for a period of time approximately equal to such Interest Period
by
(ii) a percentage equal to 1
minus
the stated maximum rate (stated as a decimal) of all reserves, if any, required to be maintained with respect to Eurocurrency funding (currently referred to as “Eurocurrency liabilities”) as specified in Regulation D of the Board of Governors of the Federal Reserve System (or against any other category of liabilities which includes deposits by reference to which the interest rate on LIBOR Loans is determined or any applicable category of extensions of credit or other assets which includes loans by an office of any Lender outside of the United States of America). Any change in such maximum rate shall result in a change in LIBOR on the date on which such change in such maximum rate becomes effective.
“
LIBOR Loan
” means a Loan bearing interest at a rate based on LIBOR, but
excluding
any Base Rate Loan.
“
LIBOR Market Index Rate
” means, for any day, LIBOR as of that day for one-month deposits in U.S. Dollars at approximately 11:00 a.m. Central time for such day (or if such day is not a Business Day, the immediately preceding Business Day). The LIBOR Market Index Rate shall be determined on a daily basis.
“
Lien
” as applied to the property of any Person means: (a) any security interest, encumbrance, mortgage, deed to secure debt, deed of trust, assignment of leases or rents, pledge, lien, hypothecation, assignment, charge or lease constituting a Capitalized Lease Obligation, conditional sale or other title retention agreement, or other security title or encumbrance of any kind in respect of any property of such Person, or upon the income, rents or profits therefrom; (b) any arrangement, express or implied, under which any property of such Person is transferred, sequestered or otherwise identified for the purpose of subjecting the same to the payment of Indebtedness or performance of any other obligation in priority to the payment of the general, unsecured creditors of such Person; (c) the filing of any financing statement under the Uniform Commercial Code or its equivalent in any jurisdiction, other than any precautionary filing not otherwise constituting or giving rise to a Lien, including a financing statement filed (i) in respect of a lease not constituting a Capitalized Lease Obligation pursuant to Section 9-505 (or a successor provision) of the Uniform Commercial Code or its equivalent as in effect in an applicable jurisdiction or (ii) in connection with a sale or other disposition of accounts or other assets not prohibited by this Agreement in a transaction not otherwise constituting or giving rise to a Lien; and (d) any agreement by such Person to grant, give or otherwise convey any of the foregoing.
“
Limited Subsidiary
” means any Subsidiary of the Parent that, directly or indirectly, owns (a) any Equity Interest in any Loan Party or (ii) any Specified Equity Interests.
“
Loan
” means a Revolving Loan or a Swingline Loan.
“
Loan Document
” means this Agreement, each Note, the Guaranty, the Parent Guaranty, each Letter of Credit Document and each other document or instrument now or hereafter executed and delivered by a Loan Party in connection with, pursuant to or relating to this Agreement (other than the Fee Letter and any Specified Derivatives Contract).
“
Loan Party
” means each of the Borrower, each Guarantor, the General Partner and each other Person who guarantees all or a portion of the Obligations. Part I of
Schedule 7.1.(b)
sets forth the Loan Parties in addition to the Borrower as of the Agreement Date. For purposes of clarity, any Person which is a Loan Party solely by virtue of having Guaranteed all or a portion of the Obligations shall cease to be a Loan Party upon the release of such Person from all of its obligations under such Guaranty.
“
Management Company
” means CBL & Associates Management, Inc., a Delaware corporation, or any other Person that succeeds to the obligations of CBL & Associates Management, Inc. to manage the Properties, together with its successors and permitted assigns.
“
Mandatorily Redeemable Stock
” means, with respect to any Person, any Equity Interest of such Person which by the terms of such Equity Interest (or by the terms of any security into which it is convertible or for which it is exchangeable or exercisable), upon the happening of any event or otherwise, (a) matures or is mandatorily redeemable, pursuant to a sinking fund obligation or otherwise (other than an Equity Interest to the extent redeemable in exchange for common stock or other equivalent common Equity Interests at the option of the issuer of such Equity Interest), (b) is convertible into or exchangeable or exercisable for Indebtedness or Mandatorily Redeemable Stock, or (c) is redeemable at the option of the holder thereof, in whole or in part (other than an Equity Interest which is redeemable solely in
exchange for common stock or other equivalent common Equity Interests, or, at the election of the Borrower, in exchange for cash); in each case, on or prior to the Maturity Date.
“
Material Adverse Effect
” means a materially adverse effect on (a) the business, assets, liabilities, condition (financial or otherwise), results of operations or business prospects of the Borrower and its Subsidiaries, or the Parent and its Subsidiaries, in either case taken as a whole, (b) the ability of the Borrower, any other Loan Party or the Parent to perform its obligations under any Loan Document to which it is a party, (c) the validity or enforceability of any of the Loan Documents, (d) the rights and remedies of the Lenders, the Issuing Bank and the Administrative Agent under any of the Loan Documents or (e) the timely payment of the principal of or interest on the Loans or other amounts payable in connection therewith or the timely payment of all Reimbursement Obligations.
“
Material Contract
” means any contract or other arrangement relating to a Property (other than Loan Documents and Specified Derivatives Contracts), whether written or oral, to which the Borrower, any Subsidiary or any other Loan Party is a party as to which the breach, non-performance, cancellation or failure to renew by any party to such contract or other arrangement could reasonably be expected to have a Material Adverse Effect.
“
Material Plan
” means at any time a Plan or Plans having aggregate Unfunded Liabilities in excess of $1,000,000.
“
Material Subsidiary
” means any Subsidiary having assets with a Fair Market Value greater than or equal to $10,000,000.
“
Maturity Date
” means November 11, 2016, as such date may be extended pursuant to Section 2.13.
“
Moody's
” means Moody's Investors Service, Inc. and its successors.
“
Mortgage
” means a mortgage, deed of trust, deed to secure debt or similar security instrument made or to be made by a Person owning an interest in real estate granting a Lien on such interest in real estate as security for the payment of Indebtedness.
“
Mortgage Receivable
” means Indebtedness secured by Mortgages in favor of the Borrower or any Subsidiary.
“
Multiemployer Plan
” means at any time a multiemployer plan within the meaning of Section 4001(a)(3) of ERISA to which any member of the ERISA Group is then making or accruing an obligation to make contributions or has within the preceding five (5) plan years made contributions, including for these purposes any Person which ceased to be a member of the ERISA Group during such five (5) year period.
“
Negative Pledge
” means, with respect to a given asset, any provision of a document, instrument or agreement (other than any Loan Document or Specified Derivatives Contract) which prohibits or purports to prohibit the creation or assumption of any Lien on such asset as security for Indebtedness of the Person owning such asset or any other Person; provided, however, that an agreement that conditions a Person's ability to encumber its assets upon the maintenance of one or more specified ratios that limit such Person's ability to encumber its assets but that do not generally prohibit the encumbrance of its assets, or the encumbrance of specific assets, shall not constitute a Negative Pledge.
“
Net Operating Income
” or “
NOI
” means, for any Property and for a given period, the sum of the following (without duplication and determined on a consistent basis with prior periods): (a) rents and other revenues received in the ordinary course from such Property (including proceeds of rent loss or business interruption insurance but 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 (excluding interest) related to the ownership, operation or maintenance of such Property, including but not limited to property taxes, assessments and the like, insurance, utilities, payroll costs, maintenance, repair and landscaping expenses, marketing expenses, and general and administrative expenses (including an appropriate allocation for legal, accounting, advertising, marketing and other expenses incurred in connection with such Property, but specifically excluding general overhead expenses of the Parent and its Subsidiaries and any property management fees)
minus
(c) the Capital Reserves for such Property as of the end of such period
minus
(d) an imputed management fee in the amount of three percent (3%) of the aggregate base rents and percentage rents received for such Property for such period.
“
Net Proceeds
” means with respect to an Equity Issuance by a Person, the aggregate amount of all cash and the Fair Market Value of all other property (other than securities of such Person being converted or exchanged in connection with such Equity Issuance) received by such Person in respect of such Equity Issuance net of (a) investment banking fees, legal fees, accountants' fees, underwriting discounts and commissions and other customary fees and expenses actually incurred by such Person in connection with such Equity Issuance and (b) the aggregate amount of cash payments made to holders of Equity Interests of such Person to retire or repurchase such Equity Interests during three calendar month period following the date on which such Equity Issuance occurred, provided that the amount under this clause (b) shall in no event exceed the aggregate cash proceeds received from such Equity Issuance.
“
Non-Defaulting Lender
” means, at any time, each Lender that is not a Defaulting Lender at such time.
“
Non-Recourse Indebtedness
” means, with respect to a Person, Indebtedness for borrowed money in respect of which recourse for payment (except for customary exceptions for fraud, misapplication of funds, environmental indemnities, voluntary bankruptcy, collusive involuntary bankruptcy and other similar customary exceptions to non-recourse liability in a form reasonably acceptable to the Administrative Agent) is contractually limited to specific assets of such Person encumbered by a Lien securing such Indebtedness.
“
Note
” means a Revolving Note or a Swingline Note.
“
Notice of Borrowing
” means a notice substantially in the form of
Exhibit C
(or such other form reasonably acceptable to the Administrative Agent and containing the information required in such Exhibit) to be delivered to the Administrative Agent pursuant to Section 2.1.(b) evidencing the Borrower's request for a borrowing of Revolving Loans.
“
Notice of Continuation
” means a notice substantially in the form of
Exhibit D
(or such other form reasonably acceptable to the Administrative Agent and containing the information required in such Exhibit) to be delivered to the Administrative Agent pursuant to Section 2.9. evidencing the Borrower's request for the Continuation of a LIBOR Loan.
“
Notice of Conversion
” means a notice substantially in the form of
Exhibit E
(or such other form reasonably acceptable to the Administrative Agent and containing the information required in such Exhibit) to be delivered to the Administrative Agent pursuant to Section 2.10. evidencing the Borrower's request for the Conversion of a Loan from one Type to another Type.
“
Notice of Swingline Borrowing
” means a notice substantially in the form of
Exhibit F
(or such other form reasonably acceptable to the Administrative Agent and containing the information required in such Exhibit) to be delivered to the Swingline Lender pursuant to Section 2.3.(b) evidencing the Borrower's request for a Swingline Loan.
“
Obligations
” means, individually and collectively, without duplication: (a) the aggregate principal balance of, and all accrued and unpaid interest on, all Loans; (b) all Reimbursement Obligations and all other Letter of Credit Liabilities; and (c) all other indebtedness, liabilities, obligations, covenants and duties of the Borrower or any of the other Loan Parties owing to the Administrative Agent, the Issuing Bank or any Lender of every kind, nature and description, under or in respect of this Agreement or any of the other Loan Documents, including, without limitation, the Fees and indemnification obligations, whether direct or indirect, absolute or contingent, due or not due, contractual or tortious, liquidated or unliquidated, and whether or not evidenced by any promissory note. For the avoidance of doubt, “Obligations” shall not include Specified Derivatives Obligations.
“
Occupancy Rate
” means, with respect to a Property at any time, the ratio, expressed as a percentage, of (a) the net rentable owned square footage of such Property actually occupied by tenants (unless due to a temporary cessation of business, or tenants scheduled to open within the next one hundred twenty (120) days) that are not affiliated with the Borrower and paying rent, pursuant to binding leases as to which no monetary default has occurred and has continued unremedied for one hundred twenty (120) or more days to (b) the aggregate owned net rentable square footage of such Property.
“
OFAC
” has the meaning given that term in Section 7.1.(x).
“
Off-Balance Sheet Obligations
” means liabilities and obligations of the Parent, the Borrower, any Subsidiary or any other Person in respect of “off-balance sheet arrangements” (as defined in Item 303(a)(4)(ii) of Regulation S-K promulgated under the Securities Act) which the Parent would be required to disclose in the “Management's Discussion and Analysis of Financial Condition and Results of Operations” section of the Parent's report on Form 10-Q or Form 10-K (or their equivalents) which the Parent is required to file with the Securities and Exchange Commission (or any Governmental Authority substituted therefor).
“
Officer's Certificate
” means a certificate from a Senior Officer of the Parent certifying (i) the “Eligible Properties”, (ii) each Subsidiary owning a direct interest in each Eligible Property and (iii) the “Excluded Subsidiaries”, in each case, as of the Agreement Date.
“
Ownership Share
” means, with respect to any Subsidiary of a Person (other than a Wholly Owned Subsidiary) or any Unconsolidated Affiliate of a Person, the greater of (a) such Person's relative nominal direct and indirect ownership interest (expressed as a percentage) in such Subsidiary or Unconsolidated Affiliate or (b) subject to compliance with Section 9.4.(k), such Person's relative direct and indirect economic interest (calculated as a percentage) in such Subsidiary or Unconsolidated Affiliate determined in accordance with the applicable provisions of the declaration of trust, articles or certificate of incorporation or formation, articles of organization, partnership agreement, joint venture agreement or other applicable organizational document of such Subsidiary or Unconsolidated Affiliate.
“
Parent
” has the meaning set forth in the introductory paragraph hereof and shall include the Parent's successors and permitted assigns.
“
Parent Guaranty
” means the Parent Guaranty executed and delivered by the Parent in favor of the Administrative Agent and the Lenders and substantially in the form of
Exhibit G
.
“
Participant
” has the meaning given that term in Section 13.6.(d).
“
PBGC
” means the Pension Benefit Guaranty Corporation and any successor agency.
“
Permitted Liens
” means, with respect to any asset or property of a Person, (a) Liens securing taxes, assessments and other charges or levies imposed by any Governmental Authority (excluding any Lien imposed pursuant to any of the provisions of ERISA or pursuant to any Environmental Laws), (b) the claims of materialmen, mechanics, carriers, warehousemen or landlords for labor, materials, supplies or rentals incurred in the ordinary course of business, which, in each case, are not at the time required to be paid or discharged under Section 8.6; (c) Liens consisting of deposits or pledges made, in the ordinary course of business, in connection with, or to secure payment of, obligations under workers' compensation, unemployment insurance or similar Applicable Laws; (d) Liens consisting of encumbrances in the nature of zoning restrictions, easements, and rights or restrictions of record on the use of real property, which do not materially detract from the value of such property or impair the intended use thereof in the business of such Person; (e) the rights of tenants under leases or subleases not interfering with the ordinary conduct of business of such Person; (f) Liens in favor of the Administrative Agent for its benefit and the benefit of the Lenders, each Specified Derivatives Provider and the Issuing Bank;
and (g) Liens in existence on the Agreement Date and set forth in
Schedule 1.1.
hereto.
“
Person
” means any natural person, corporation, limited partnership, general partnership, joint stock company, limited liability company, limited liability partnership, joint venture, association, company, trust, bank, trust company, land trust, business trust or other organization, whether or not a legal entity, or any other non-governmental entity, or any Governmental Authority.
“
Plan
” means at any time an employee pension benefit plan (other than a Multiemployer Plan) which is covered by Title IV of ERISA or subject to the minimum funding standards under Section 412 of the Internal Revenue Code and either (i) is maintained, or contributed to, by any member of the ERISA Group for employees of any member of the ERISA Group or (ii) has at any time within the preceding five (5) years been maintained, or contributed to, by any Person which was at such time a member of the ERISA Group for employees of any Person which was at such time a member of the ERISA Group.
“
Post-Default Rate
” means, in respect of any Event of Default resulting from the principal of any Loan or any Reimbursement Obligation not being paid when due, the rate otherwise applicable
plus
an additional five percent (5%) per annum and with respect to any Event of Default resulting from any other Obligation that is not paid when due (whether at stated maturity, by acceleration, by optional or mandatory prepayment or otherwise) or any other Event of Default, a rate per annum equal to the Base Rate as in effect from time to time plus the Applicable Margin plus five percent (5%) per annum.
“
Preferred Stock
” means, 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.
“
Principal Office
” means the office of the Administrative Agent located at 608 Second Avenue S., 11
th
Floor, Minneapolis, Minnesota 55402-1916, or such other office as the Administrative Agent may notify the Borrower.
“
Principals
” means (a) Charles B. Lebovitz, John N. Foy, Ben S. Landress, Stephen Lebovitz, Michael Lebovitz, Alan Lebovitz, Augustus N. Stephas and/or Farzana Mitchell (b) any of such individual's immediate family members consisting of his spouse and his lineal descendants (whether natural or adopted), (c) a trust, partnership or other similar entity of which any of the Persons identified in
either of the immediately preceding clauses (a) or (b) are the sole beneficiaries of all of the interest therein, and (d) any Subsidiary of any of the Persons identified in any of the immediately preceding clauses (a) through (c), so long as any of the individuals identified in the immediately preceding clause (a) owns or controls at least ten percent (10%) 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 or other entity (without regard to the occurrence of any contingency).
“
Property
” means a parcel (or group of related parcels) of real property developed (or to be developed) by the Borrower, any Subsidiary or any Unconsolidated Affiliate.
“
Property Management Agreements
” means, collectively, all agreements entered into by the Borrower or any other Loan Party pursuant to which the Borrower or such other Loan Party engages a Person to advise it with respect to the management of a given Property and/or to manage a given Property.
“
Pro Rata Share
” means, as to each Lender, the ratio, expressed as a percentage of (a) the amount of such Lender's Revolving Commitment to (b) the aggregate amount of the Revolving Commitments of all Lenders; provided, however, that if at the time of determination the Revolving Commitments have terminated or been reduced to zero, the “Pro Rata Share” of each Lender shall be the ratio, expressed as a percentage of (A) the sum of the unpaid principal amount of all outstanding Revolving Loans, Swingline Loans and Letter of Credit Liabilities owing to such Lender as of such date to (B) the sum of the aggregate unpaid principal amount of all outstanding Revolving Loans, Swingline Loans and Letter of Credit Liabilities of all Lenders as of such date.
“
Purchase Money Advances
” means Indebtedness in favor of the Borrower or any Subsidiary which has been advanced to a bona fide third party in connection with an arm's length sale by the Borrower or any Subsidiary of a Property to the respective third party.
“
Rating Agency
” means S&P or Moody's.
“
Recourse Indebtedness
” means any Indebtedness of a Person that is not Non-Recourse Indebtedness.
“
Register
” has the meaning given that term in Section 13.6.(c).
“
Regulatory Change
” means, with respect to any Lender, any change effective after the Agreement Date in Applicable Law (including without limitation, Regulation D of the Board of Governors of the Federal Reserve System) or the adoption or making after such date of any interpretation, directive or request applying to a class of banks, including such Lender, of or under any Applicable Law (whether or not having the force of law and whether or not failure to comply therewith would be unlawful) by any Governmental Authority or monetary authority charged with the interpretation or administration thereof or compliance by any Lender with any request or directive regarding capital adequacy or liquidity requirements. Notwithstanding anything herein to the contrary, (a) the Dodd-Frank Wall Street Reform and Consumer Protection Act and all requests, rules, guidelines or directives thereunder or issued in connection therewith and (b) all requests, rules, guidelines or directives promulgated by the Bank for International Settlements, the Basel Committee on Banking Supervision (or any successor or similar authority) or the United States or foreign regulatory authorities, in each case pursuant to Basel III, shall in each case be deemed to be a “Regulatory Change,” regardless of the date enacted, adopted or issued.
“
Reimbursement Obligation
” means the obligation of the Borrower to reimburse the Issuing Bank for any drawing honored by the Issuing Bank under a Letter of Credit.
“
REIT
” means a Person qualifying for treatment as a “real estate investment trust” under the Internal Revenue Code.
“
Related Parties
” means, with respect to any Person, such Person's Affiliates and the partners, directors, officers, employees, agents and advisors of such Person and of such Person's Affiliates.
“
Requisite Lenders
” means, as of any date, (a) Lenders having more than fifty-one percent (51%) of the aggregate amount of the Revolving Commitments or (b) if the Lenders' Revolving Commitments have been terminated or reduced to zero, Lenders holding more than fifty-one percent (51%) of the principal amount of the aggregate outstanding Revolving Loans and Letter of Credit Liabilities; provided that (i) in determining such percentage at any given time, all then existing Defaulting Lenders will be disregarded and excluded, and the Pro Rata Shares shall be redetermined, for voting purposes only, to exclude the Pro Rata Shares of such Defaulting Lenders and (ii) at all times when two (2) or more Lenders are party to this Agreement (excluding Defaulting Lenders), the term “Requisite Lenders” shall in no event mean less than two (2) Lenders.
For purposes of this definition, a Lender shall be deemed to hold a Swingline Loan or a Letter of Credit Liability to the extent such Lender has acquired a participation therein under the terms of this Agreement and has not failed to perform its obligations in respect of such participation.
“
Restricted Payment
” means: (a) any dividend or other distribution, direct or indirect, on account of any Equity Interest of the Parent or any of its Subsidiaries now or hereafter outstanding, except a dividend payable solely in shares of that class of Equity Interest to the holders of that class; (b) any redemption, conversion, exchange, retirement, sinking fund or similar payment, purchase or other acquisition for value, direct or indirect, of any Equity Interest of the Parent or any of its Subsidiaries now or hereafter outstanding; (c) any payment or prepayment of principal of, premium, if any, or interest on, redemption, conversion, exchange, purchase, retirement, defeasance, sinking fund or similar payment with respect to, any Subordinated Debt; and (d) any payment made to retire, or to obtain the surrender of, any outstanding warrants, options or other rights to acquire any Equity Interests of the Parent or any of its Subsidiaries now or hereafter outstanding.
“
Retail Properties
” means a Property developed and operated for retail use or mixed-use.
“
Revolving Commitment
” means, as to each Lender (other than the Swingline Lender), such Lender's obligation to make Revolving Loans pursuant to Section 2.1., and to participate in Letters of Credit pursuant to Section 2.2.(i) and to participate in Swingline Loans pursuant to Section 2.3.(e). in an amount up to, but not exceeding the amount set forth for such Lender on
Schedule I
as such Lender's “Revolving Commitment Amount” or as set forth in any applicable Assignment and Assumption, or agreement executed by a Lender becoming a party hereto in accordance with Section 2.17., as the same may be reduced from time to time pursuant to Section 2.12. or increased or reduced as appropriate to reflect any assignments to or by such Lender effected in accordance with Section 13.6. or increased as appropriate to reflect any increase effected in accordance with Section 2.17.
“
Revolving Commitment Percentage
” means, as to each Lender with a Revolving Commitment, the ratio, expressed as a percentage, of (a) the amount of such Lender's Revolving Commitment to (b) the aggregate amount of the Revolving Commitments of all Lenders hereunder; provided, however, that if at the time of determination the Revolving Commitments have been terminated or been reduced to zero, the “Revolving Commitment Percentage” of each Lender with a Revolving
Commitment shall be the “Revolving Commitment Percentage” of such Lender in effect immediately prior to such termination or reduction.
“
Revolving Credit Exposure
” means, as to any Lender at any time, the aggregate principal amount at such time of its outstanding Revolving Loans and such Lender's participation in Letter of Credit Liabilities and Swingline Loans at such time.
“
Revolving Loan
” means a loan made by a Lender to the Borrower pursuant to Section 2.1.(a).
“
Revolving Note
” means a promissory note of the Borrower substantially in the form of
Exhibit H
, payable to the order of a Lender in a principal amount equal to the amount of such Lender's Revolving Commitment.
“
S&P
” means Standard & Poor's Rating Services, a Standard & Poor's Financing Services LLC business, and its successors.
“
Secured Indebtedness
” means, with respect to a Person as of a given date, the aggregate principal amount of all Indebtedness of such Person outstanding on such date that is secured in any manner by any Lien on any property, and in the case of the Parent, shall include (without duplication), the Parent's Ownership Share of the Secured Indebtedness of its Unconsolidated Affiliates.
“
Securities Act
” means the Securities Act of 1933, as amended from time to time, together with all rules and regulations issued thereunder.
“
Senior Officer
” means the Chairman, Vice Chairman, CEO and President, an Executive Vice President, Vice President - Finance, Vice President - Accounting, Chief Operating Officer, and the Chief Financial Officer of the Borrower or the Parent.
“
Significant Subsidiary
” means an Subsidiary which has assets having an aggregate book value in excess of five percent (5%) of Total Asset Value.
“
Solvent
” means, when used with respect to any Person, that (a) the fair value and the fair salable value of its assets (excluding any Indebtedness due from any affiliate of such Person) are each in excess of the fair valuation of its total liabilities (including all contingent liabilities); (b) such Person is able to pay its debts or other obligations in the ordinary course as they mature; and (c) such Person has capital not unreasonably small to carry on its business and all business in which it proposes to be engaged.
“
Specified Derivatives Contract
” means any Derivatives Contract, together with any Derivatives Support Document relating thereto, that is made or entered into at any time, or in effect at any time now or hereafter, which relate to the Obligations, whether as a result of an assignment or transfer or otherwise, between the Borrower or any Loan Party and any Specified Derivatives Provider.
“
Specified Derivatives Obligations
” means all indebtedness, liabilities, obligations, covenants and duties of the Borrower or its Subsidiaries under or in respect of any Specified Derivatives Contract, whether direct or indirect, absolute or contingent, due or not due, liquidated or unliquidated, and whether or not evidenced by any written confirmation.
“
Specified Derivatives Provider
” means any Lender, or any Affiliate of a Lender that is a party to a Derivatives Contract at the time the Derivatives Contract is entered into.
“
Specified Equity Interests
” has the meaning given that term in Section 10.2.(b).
“
Stated Amount
” means the amount available to be drawn by a beneficiary under a Letter of Credit from time to time, as such amount may be increased or reduced from time to time in accordance with the terms of such Letter of Credit.
“
Subordinated Debt
” means Indebtedness for money borrowed of the Borrower or any of its Subsidiaries that is subordinated in right of payment and otherwise to the Loans, the other Obligations and the Specified Derivatives Obligations, if any, in a manner satisfactory to the Administrative Agent in its sole and absolute discretion.
“
Subsidiary
” means, for any Person, any corporation, partnership, limited liability company or other entity of which at least a majority of the Equity Interests having by the terms thereof ordinary voting power to elect a majority of the board of directors or other individuals 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.
“
Swingline Commitment
” means the Swingline Lender's obligation to make Swingline Loans pursuant to Section 2.3.
in an amount up to, but not exceeding the amount set forth in the first sentence of Section 2.3.(a), as such amount may be reduced from time to time in accordance with the terms hereof.
“
Swingline Lender
” means Wells Fargo Bank, National Association, together with its respective successors and assigns.
“
Swingline Loan
” means a loan made by the Swingline Lender to the Borrower pursuant to Section 2.3.
“
Swingline Maturity Date
” means the date which is seven (7) Business Days prior to the Maturity Date.
“
Swingline Note
” means the promissory note of the Borrower substantially in the form of
Exhibit I
, payable to the order of the Swingline Lender in a principal amount equal to the amount of the Swingline Commitment as originally in effect and otherwise duly completed.
“
Tangible Net Worth
” means, with respect to any Person as of a given date, the stockholders' equity of such Person determined on a consolidated basis
plus
(x) increases in accumulated depreciation and amortization accrued after June 30, 2012 and (y) non-controlling interests (including redeemable non-controlling interests) in any such Person or any Subsidiary of such Person,
minus
(to the extent included when determining stockholders' equity and non-controlling interests including redeemable non-controlling interests of such Person and its Subsidiaries): (a) the amount of any write-up in the book value of any assets reflected in any balance sheet resulting from revaluation thereof or any write up in excess of the cost of such assets acquired (but excluding any such write-up for purchase price adjustments of acquisition properties based on GAAP), and (b) the aggregate of all amounts appearing on any such balance sheet for franchises, licenses, permits, patents, patent applications, copyrights, trademarks, service marks, trade names, goodwill, treasury stock, experimental or organizational expenses and other like assets which would be classified as intangible assets under GAAP (including net lease intangibles) all
determined as of such date on a consolidated basis, and (c) accumulated other comprehensive income (or loss).
“
Taxes
” has the meaning given that term in Section 3.10.
“
Tenant Lease
” means any lease entered into by the Borrower, any Loan Party or any Subsidiary with respect to any portion of a Property.
“
Third Party Affiliate
” means any Person which owns any interest in Parent, Borrower or any Subsidiary or Unconsolidated Affiliate of Borrower, but which Person is neither a Senior Officer nor a Subsidiary of Borrower.
“
Total Asset Value
” means, at a given time, the sum (without duplication) of all of the following of the Parent and its Subsidiaries determined on a consolidated basis in accordance with GAAP applied on a consistent basis: (a) cash and Cash Equivalents (other than tenant deposits and other cash and Cash Equivalents that are subject to a Lien or a Negative Pledge or the disposition of which is restricted in any way, but
including
any escrow deposits for real estate taxes, insurance, tenant allowances and capital expenditures);
plus
(b) the quotient of (i) EBITDA of the Parent and its Subsidiaries calculated for the immediately preceding period of four (4) consecutive fiscal quarters for (x) Properties owned for four (4) or more quarters and (y) Properties owned for fewer than four (4) quarters that have achieved an Occupancy Rate of eighty-five percent (85%) or more, calculated on an annualized basis (excluding EBITDA attributable from assets in (c), (d), (e), (f), (g), (h) and (i) below),
divided by
(ii) the Capitalization Rate; provided that, for purposes of calculating Total Asset Value only, “EBITDA” may include straight line rent leveling adjustments;
plus
(c) the undepreciated GAAP book value of Properties acquired during the four (4) fiscal quarters most recently ended;
plus
(d) the GAAP book value of all Development Properties;
plus
(e) the GAAP book value of Unimproved Land,
plus
(f) the GAAP book value of Mortgages Receivable and Purchase Money Advances;
plus
(g) the GAAP book value of Equity Interests; plus (h) with respect to any purchase obligation, repurchase obligation or forward commitment evidenced by a binding contract included when determining the Indebtedness of the Parent and its Subsidiaries, the reasonably determined value of any amount that would be payable, or property that would be transferable, to the Parent or any Subsidiary as if such contract were closed as of such date; plus (i) to the extent not included in the immediately preceding clauses (a) through (h), the value of any real property owned by a Subsidiary (that is not a Wholly Owned Subsidiary) of the Borrower or an Unconsolidated Affiliate of the Borrower (such Subsidiary or Unconsolidated Affiliate being a "JV"), to the extent the Borrower or a Subsidiary guarantees the Indebtedness of any JV in an amount in excess of its ownership ratio in such JV, provided that if such Indebtedness is paid by the Borrower or a Subsidiary of the Borrower, then the Borrower or a Subsidiary of the Borrower shall automatically acquire, without the necessity of any further payment or action, all Equity Interests in such JV not owned by the Borrower or any Subsidiary. The Borrower's Ownership Share of assets held by Unconsolidated Affiliates (excluding assets of the type described in the immediately preceding clause (a)) will be included in the calculation of Total Asset Value consistent with the above described treatment for wholly owned assets. EBITDA attributable to Properties disposed of during the fiscal quarter ending immediately prior to any date of determination of Total Asset Value shall not be included in the calculation of Total Asset Value. Notwithstanding the foregoing, for purposes of determining Total Asset Value, to the extent the amount of Total Asset Value attributable to Properties leased under Ground Leases would exceed ten percent (10%) of Total Asset Value, such excess shall be excluded.
“
Total Budgeted Cost
” means, with respect to a Development Property, and at any time, the aggregate amount of all costs budgeted to be paid, incurred or otherwise expended or accrued by the
Borrower, a Subsidiary or an Unconsolidated Affiliate with respect to such Property to achieve an Occupancy Rate of one hundred percent (100%), including without limitation, all amounts budgeted with respect to all of the following: (a) acquisition of land and any related improvements; (b) a reasonable and appropriate reserve for construction interest; (c) a reasonable and appropriate operating deficit reserve; (d) tenant improvements, (e) leasing commissions and (f) other hard and soft costs associated with the development or redevelopment of such Property; provided, however, Total Budgeted Cost shall be reduced by cash actually received by Borrower, such Subsidiary or such Unconsolidated Affiliate as a result of governmental reimbursements or in connection with the sale of outparcels. With respect to any Property to be developed in more than one phase, the Total Budgeted Cost shall exclude budgeted costs (other than costs relating to acquisition of land and related improvements) to the extent relating to any phase for which (i) construction has not yet commenced and (ii) a binding construction contract has not been entered into by the Borrower, any other Subsidiary or any Unconsolidated Affiliate, as the case may be.
“
Total Indebtedness
” means all Indebtedness of the Parent and its Ownership Share of all Indebtedness of all of its Subsidiaries.
“
Transfer Authorizer Designation Form
” means a form substantially in the form of
Exhibit J
to be delivered to the Administrative Agent pursuant to Section 6.1., as the same may be amended, restated or modified from time to time with the prior written approval of the Administrative Agent.
“
Type
” with respect to any Loan, refers to whether such Loan or portion thereof is a LIBOR Loan or a Base Rate Loan.
“
Unconsolidated Affiliate
” means, with respect to any Person, any other Person in whom such Person holds, either directly or indirectly through one or more Subsidiaries, an Investment, which Investment is accounted for in the financial statements of such Person on an equity basis of accounting and whose financial results would not be consolidated under GAAP with the financial results of such Person on the consolidated financial statements of such Person.
“
Unencumbered Asset Value
” means the sum of (1) (a) (i) the sum of (x) the NOI (excluding NOI attributable to Development Properties) for Eligible Properties owned for four (4) or more quarters for the immediately preceding period of four (4) consecutive fiscal quarters plus (y) the NOI (excluding NOI attributable to Development Properties) for Eligible Properties owned for less than four (4) quarters that have achieved an Occupancy Rate of eighty-five percent (85%) or more, calculated on an annualized basis, divided by (ii) the Capitalization Rate, plus (b) the undepreciated GAAP book value of all Eligible Properties acquired during the four (4) fiscal quarters most recently ended, plus (c) cash and Cash Equivalents (other than tenant deposits and other cash and Cash Equivalents that are subject to a Lien or a Negative Pledge or the disposition of which is restricted in any way), plus (d) the GAAP book value of Unimproved Land (which meets the requirements for Eligible Property) that is not subject to any Lien (other than Permitted Liens (but not Permitted Liens described in clause (g) of the definition of that term)) or any Negative Pledge, plus (e) the GAAP book value of Mortgages Receivable that are not subject to any Lien (other than Permitted Liens (but not Permitted Liens described in clause (g) of the definition of that term)) or any Negative Pledge, plus (f) the GAAP book value of Purchase Money Advances that are not subject to any Lien (other than Permitted Liens (but not Permitted Liens described in clause (g) of the definition of that term)) or any Negative Pledge, plus (g) the GAAP book value of Development Properties (which meets the requirements for Eligible Property) that are not subject to any Lien (other than Permitted Liens (but not Permitted Liens described in clause (g) of the definition of that term)) or any Negative Pledge, plus (h) Equity Interests that are not subject to any Lien (other than Permitted Liens
described in clause (f) of the definition of that term) or any Negative Pledge, plus (2) Borrower's Ownership Share of value, calculated as in clause (1)(a) above, of non-wholly owned Properties that are not subject to any Lien or any Negative Pledge. Notwithstanding the above, the percentage of Unencumbered Asset Value attributable to Properties subject to a Ground Lease will not exceed ten percent (10%) of the Unencumbered Asset Value. For purposes of this definition, (i) to the extent the Unencumbered Asset Value attributable to clause (1)(d) would exceed five percent (5%) of the Unencumbered Asset Value, such excess shall be excluded, (ii) to the extent the Unencumbered Asset Value attributable to clause (1)(e) would exceed five percent (5%) of the Unencumbered Asset Value, such excess shall be excluded, (iii) to the extent the Unencumbered Asset Value attributable to clause (1)(f) would exceed five percent (5%) of the Unencumbered Asset Value, such excess shall be excluded, (iv) to the extent the Unencumbered Asset Value attributable to clause (1)(g) would exceed ten percent (10%) of the Unencumbered Asset Value, such excess shall be excluded, (v) to the extent the Unencumbered Asset Value attributable to clause (1)(h) would exceed five percent (5%) of the Unencumbered Asset Value, such excess shall be excluded, (vi) to the extent the Unencumbered Asset Value attributable to clause (2) would exceed fifteen percent (15%) of the Unencumbered Asset Value, such excess shall be excluded, (vii) to the extent the Unencumbered Asset Value attributable to the sum of (d), (e), (f), (g) and (h) of clause (1) and clause (2) would exceed twenty percent (20%) of the Unencumbered Asset Value, such excess shall be excluded and (vii) to the extent the Unencumbered Asset Value attributable to hotel and office properties would exceed five percent (5%) of the Unencumbered Asset Value, such excess shall be excluded.
“
Unencumbered NOI
” means, for any period, the sum of NOI from (i) all Eligible Properties plus (ii) Borrower's Ownership Share of NOI of any non-wholly owned Properties to the extent such Properties are included in the calculation of Unencumbered Asset Value and are not subject to any Lien or any Negative Pledge.
“
Unfunded Liabilities
” means, with respect to any Plan at any time, the amount (if any) by which (a) the value of all benefit liabilities under such Plan, determined on a plan termination basis using the assumptions prescribed by the PBGC for purposes of Section 4044 of ERISA, exceeds (b) the fair market value of all Plan assets allocable to such liabilities under Title IV of ERISA (excluding any accrued but unpaid contributions), all determined as of the then most recent valuation date for such Plan, but only to the extent that such excess represents a potential liability of a member of the ERISA Group to the PBGC or any other Person under Title IV of ERISA.
“
Unimproved Land
” means land on which no development (other than improvements that are not material and are temporary in nature) has occurred and for which no development is scheduled in the following twelve (12) months; provided, however, the term Unimproved Land shall not include (a) raw land subject to a Ground Lease under which the Borrower or a Subsidiary is the lessor and a Person not an Affiliate is the lessee; (b) any Development Property, (c) unimproved real estate acquired within the prior eighteen (18) months that will become a Development Property within eighteen (18) months of its acquisition (the Borrower acknowledging that if such Property does not become a Development Property within said eighteen (18) months period, such Property shall thereafter be considered unimproved real estate for purposes of this definition unless and until such Property in fact becomes a Development Property), (d) land subject to a binding contract of sale under which the Borrower or one of its Subsidiaries is the seller and the buyer is not an Affiliate of the Borrower, or (e) out-parcels held for lease or sale at Properties which are either completed or where development has commenced).
“
Unsecured Indebtedness
” means, with respect to a Person, Indebtedness of such Person that is not Secured Indebtedness; provided, however, that any Indebtedness that is secured only by a pledge of Equity Interests shall be deemed to be Unsecured Indebtedness.
“
Unsecured Interest Expense
” means, with respect to a Person and for any period, all Interest Expense of such Person for such Period attributable to Unsecured Indebtedness.
“
Wells Fargo
” means Wells Fargo Bank, National Association, and its successors and permitted assigns.
“
Wholly Owned Subsidiary
” means any Subsidiary of a Person in respect of which all of the Equity Interests (other than, in the case of a corporation, directors' qualifying shares) are at the time directly or indirectly owned or controlled by such Person or one or more other Subsidiaries of such Person or by such Person and one or more other Subsidiaries of such Person.
Section 1.2.
General; References to Central Time.
Unless otherwise indicated, all accounting terms, ratios and measurements shall be interpreted or determined in accordance with GAAP as in effect on the Agreement Date; provided that, if at any time any change in GAAP would affect the computation of any financial ratio or requirement set forth in any Loan Document, Borrower shall give Administrative Agent written notice thereof promptly after Borrower has knowledge thereof, and if either the Borrower or the Requisite Lenders shall so request, the Administrative Agent, the Lenders and the Borrower shall negotiate in good faith to amend such ratio or requirement to preserve the original intent thereof in light of such change in GAAP (subject to the approval of the Requisite Lenders); provided further that, until so amended, (i) such ratio or requirement shall continue to be computed in accordance with GAAP prior to such change therein and (ii) the Borrower shall provide to the Administrative Agent and the Lenders financial statements and other documents required under this Agreement or as reasonably requested hereunder setting forth a reconciliation between calculations of such ratio or requirement made before and after giving effect to such change in GAAP. Notwithstanding the preceding sentence, the calculation of liabilities shall not include any fair value adjustments to the carrying value of liabilities to record such liabilities at fair value pursuant to electing the fair value option election under FASB ASC 825-10-25 (formerly known as FAS 159, The Fair Value Option for Financial Assets and Financial Liabilities) or other FASB standards allowing entities to elect fair value option for financial liabilities. Accordingly, the amount of liabilities shall be the historical cost basis, which generally is the contractual amount owed adjusted for amortization or accretion of any premium or discount. References in this Agreement to “Sections”, “Articles”, “Exhibits” and “Schedules” are to sections, articles, exhibits and schedules herein and hereto unless otherwise indicated. references in this Agreement to any document, instrument or agreement (a) shall include all exhibits, schedules and other attachments thereto, (b) shall include all documents, instruments or agreements issued or executed in replacement thereof, to the extent permitted hereby and (c) shall mean such document, instrument or agreement, or replacement or predecessor thereto, as amended, supplemented, restated or otherwise modified from time to time to the extent not otherwise stated herein or prohibited hereby and in effect at any given time. Wherever from the context it appears appropriate, each term stated in either the singular or plural shall include the singular and plural, and pronouns stated in the masculine, feminine or neuter gender shall include the masculine, the feminine and the neuter. Unless explicitly set forth to the contrary, a reference to “Subsidiary” means a Subsidiary of the Parent or the Borrower (or a Subsidiary of such Subsidiary) and a reference to an “Affiliate” means a reference to an Affiliate of the Borrower or the Parent. Titles and captions of Articles, Sections, subsections and clauses in this Agreement are for convenience only, and neither limit nor amplify the
provisions of this Agreement. Unless otherwise indicated, all references to time are references to Central time.
Section 1.3.
Financial Attributes of Non-Wholly Owned Subsidiaries.
When determining the Applicable Margin and compliance by the Parent or the Borrower with any financial covenant contained in any of the Loan Documents (a) only the Ownership Share of the Parent or the Borrower, as applicable, of the financial attributes of a Subsidiary that is not a Wholly Owned Subsidiary shall be included and (b) the Parent's Ownership Share of the Borrower shall be deemed to be one hundred percent (100.0%).
Article II. Credit Facility
Section 2.1.
Revolving Loans.
(a)
Making of Revolving Loans
. Subject to the terms and conditions set forth in this Agreement, including without limitation, Section 2.15.
below, each Lender severally and not jointly agrees to make Revolving Loans to the Borrower during the period from and including the Effective Date to but excluding the Maturity Date, in an aggregate principal amount at any one time outstanding up to, but not exceeding, such Lender's Revolving Commitment; provided, however Revolving Loans shall not be made if restricted by the amount limitations set forth in Section 2.15. Each borrowing of Revolving Loans hereunder shall be in an aggregate principal amount of $100,000 and integral multiples of $1,000 in excess of that amount (except that, subject to Section 2.15., any such borrowing of Revolving Loans may be in the aggregate amount of the Revolving Commitments of all Lenders
minus
the sum of the aggregate principal balance of all Revolving Loans outstanding and the Letter of Credit Liabilities, which Revolving Loans, if less than $100,000, must be Base Rate Loans). Within the foregoing limits and subject to the terms and conditions of this Agreement, the Borrower may borrow, repay and reborrow Revolving Loans.
(b)
Requests for Revolving Loans
. Not later than 11:00 a.m. Central time at least one (1) Business Day prior to a borrowing of Base Rate Loans and not later than 11:00 a.m. Central time at least three (3) Business Days prior to a borrowing of LIBOR Loans, the Borrower shall deliver to the Administrative Agent a Notice of Borrowing. Each Notice of Borrowing shall specify the aggregate principal amount of the Revolving Loans to be borrowed, the date such Revolving Loans are to be borrowed (which must be a Business Day), the Type of the requested Revolving Loans, and if such Revolving Loans are to be LIBOR Loans, the initial Interest Period for such Revolving Loans. Each Notice of Borrowing shall be irrevocable once given and binding on the Borrower. If the Borrower fails to indicate the Type of Revolving Loans being borrowed in a Notice of Borrowing, then the Borrower shall be deemed to have requested a borrowing of LIBOR Loans having an Interest Period of one month. Prior to delivering a Notice of Borrowing, the Borrower may (without specifying whether a Revolving Loan will be a Base Rate Loan or a LIBOR Loan) request that the Administrative Agent provide the Borrower with the most recent LIBOR available to the Administrative Agent. The Administrative Agent shall provide such quoted rate to the Borrower on the date of such request or as soon as possible thereafter.
(c)
Funding of Revolving Loans
. Promptly after receipt of a Notice of Borrowing under the immediately preceding subsection (b),
the Administrative Agent shall notify each Lender of the proposed borrowing. Each Lender shall deposit an amount equal to the Revolving Loan to be made by such Lender to the Borrower with the Administrative Agent at the Principal Office, in immediately available funds not later than 11:00 a.m. Central time on the date of such proposed Revolving Loans. Subject to fulfillment
of all applicable conditions set forth herein, the Administrative Agent shall make available to the Borrower in the account specified in the Transfer Authorizer Designation Form, not later than 1:00 p.m. Central time on the date of the requested borrowing of Revolving Loans, the proceeds of such amounts received by the Administrative Agent. No Lender shall be responsible for the failure of any other Lender to make a Loan or to perform any other obligation to be made or performed by such other Lender hereunder, and the failure of any Lender to make a Loan or to perform any other obligation to be made or performed by it hereunder shall not relieve the obligation of any other Lender to make any Loan or to perform any other obligation to be made or performed by such other Lender.
(d)
Assumptions Regarding Funding by Lenders
. With respect to Revolving Loans to be made after the Effective Date, unless the Administrative Agent shall have been notified by any Lender that such Lender will not make available to the Administrative Agent a Revolving Loan to be made by such Lender in connection with any borrowing, the Administrative Agent may assume that such Lender will make the proceeds of such Revolving Loan available to the Administrative Agent in accordance with this Section, and the Administrative Agent may (but shall not be obligated to), in reliance upon such assumption, make available to the Borrower the amount of such Revolving Loan to be provided by such Lender. In such event, if such Lender does not make available to the Administrative Agent the proceeds of such Revolving Loan, then such Lender and the Borrower severally agree to pay to the Administrative Agent within three (3) Business Days following written demand the amount of such Revolving Loan with interest thereon, for each day from and including the date such Revolving Loan is made available to the Borrower but excluding the date of payment to the Administrative Agent, at (i) in the case of a payment to be made by such Lender, the greater of the Federal Funds Rate and a rate determined by the Administrative Agent in accordance with banking industry rules on interbank compensation and (ii) in the case of a payment to be made by the Borrower, the interest rate applicable to Base Rate Loans. If the Borrower and such Lender shall pay the amount of such interest to the Administrative Agent for the same or overlapping period, the Administrative Agent shall promptly remit to the Borrower the amount of such interest paid by the Borrower for such period. If such Lender pays to the Administrative Agent the amount of such Revolving Loan, the amount so paid shall constitute such Lender's Revolving Loan included in the borrowing. Any payment by the Borrower shall be without prejudice to any claim the Borrower may have against a Lender that shall have failed to make available the proceeds of a Revolving Loan to be made by such Lender.
Section 2.2.
Letters of Credit.
(a)
Letters of Credit
. Subject to the terms and conditions of this Agreement, including without limitation, Section 2.15., the Issuing Bank, on behalf of the Lenders, agrees to issue for the account of the Borrower during the period from and including the Effective Date to, but excluding, the date thirty (30) days prior to the Maturity Date, one or more standby letters of credit (each a “Letter of Credit”) up to a maximum aggregate Stated Amount at any one time outstanding not to exceed $50,000,000 as such amount may be reduced from time to time in accordance with the terms hereof (the “L/C Commitment Amount”).
(b)
Terms of Letters of Credit
. At the time of issuance, the amount, form, terms and conditions of each Letter of Credit, and of any drafts or acceptances thereunder, shall be subject to approval by the Issuing Bank and the Borrower. Notwithstanding the foregoing, in no event may (i) the expiration date of any Letter of Credit extend (except to the extent permitted under Section 2.14), beyond the Maturity Date, or (ii) any Letter of Credit have an initial duration in excess of one year; provided, however, a Letter of Credit may contain a provision providing for the automatic extension of the expiration date in the absence of a notice of non-renewal from the Issuing Bank but in no event shall any
such provision permit the extension of the expiration date of such Letter of Credit beyond the date that is thirty (30) days prior to the Maturity Date. The initial Stated Amount of each Letter of Credit shall be at least $200,000 (or such lesser amount as may be acceptable to the applicable Issuing Bank, the Administrative Agent and the Borrower).
(c)
Requests for Issuance of Letters of Credit
. The Borrower shall give the Issuing Bank and the Administrative Agent written notice at least four (4) Business Days prior (or such shorter period as may be mutually agreed by the Borrower and the Issuing Bank) to the requested date of issuance of a Letter of Credit, such notice to describe in reasonable detail the proposed terms of such Letter of Credit and the nature of the transactions or obligations proposed to be supported by such Letter of Credit, and in any event shall set forth with respect to such Letter of Credit the proposed (i) initial Stated Amount, (ii) beneficiary, and (iii) expiration date. The Borrower shall also execute and deliver such customary applications and agreements for standby letters of credit, and other forms as requested from time to time by the Issuing Bank. Provided the Borrower has given the notice prescribed by the first sentence of this subsection and delivered such applications and agreements referred to in the preceding sentence, subject to the other terms and conditions of this Agreement, including the satisfaction of any applicable conditions precedent set forth in Article 6.2., the Issuing Bank shall issue the requested Letter of Credit on the requested date of issuance for the benefit of the stipulated beneficiary but in any event no later than the date four (4) Business Days following the date after which the Issuing Bank has received all of the items required to be delivered to it under this subsection. The Issuing Bank shall not at any time be obligated to issue any Letter of Credit if such issuance would conflict with, or cause the Issuing Bank or any Lender to exceed any limits imposed by, any Applicable Law. References herein to “issue” and derivations thereof with respect to Letters of Credit shall also include extensions or modifications of any outstanding Letters of Credit, unless the context otherwise requires. Upon the written request of the Borrower, the Issuing Bank shall deliver to the Borrower a copy of (i) any Letter of Credit proposed to be issued hereunder prior to the issuance thereof and (ii) each issued Letter of Credit within a reasonable time after the date of issuance thereof. To the extent any term of a Letter of Credit Document is inconsistent with a term of any Loan Document, the term of such Loan Document shall control.
(d)
Reimbursement Obligations
. Upon receipt by the Issuing Bank from the beneficiary of a Letter of Credit of any demand for payment under such Letter of Credit, the Issuing Bank shall promptly notify the Borrower and the Administrative Agent of the amount to be paid by the Issuing Bank as a result of such demand and the date on which payment is to be made by the Issuing Bank to such beneficiary in respect of such demand; provided, however, that the Issuing Bank's failure to give, or delay in giving, such notice shall not discharge the Borrower in any respect from the applicable Reimbursement Obligation. The Borrower hereby absolutely, unconditionally and irrevocably agrees to pay and reimburse the Issuing Bank for the amount of each demand for payment under such Letter of Credit at or prior to the date on which payment is to be made by the Issuing Bank to the beneficiary thereunder, without presentment, demand, protest or other formalities of any kind. Upon receipt by the Issuing Bank of any payment in respect of any Reimbursement Obligation, the Issuing Bank shall promptly pay to each Lender that has acquired a participation therein under the second sentence of the immediately following subsection (i) such Lender's Revolving Commitment Percentage of such payment.
(e)
Manner of Reimbursement
. Upon its receipt of a notice referred to in the immediately preceding subsection (d), the Borrower shall advise the Administrative Agent and the Issuing Bank whether or not the Borrower intends to borrow hereunder to finance its obligation to reimburse the Issuing Bank for the amount of the related demand for payment and, if it does, the Borrower shall submit a timely request for such borrowing as provided in the applicable provisions of this Agreement. If the Borrower fails to so advise the Administrative Agent and the Issuing Bank, or if the Borrower fails to reimburse the
Issuing Bank for a demand for payment under a Letter of Credit by the date of such payment, the failure of which the Issuing Bank shall promptly notify the Administrative Agent, then (i) if the applicable conditions contained in Article VI. would permit the making of Revolving Loans, the Borrower shall be deemed to have requested a borrowing of Revolving Loans (which shall be Base Rate Loans) in an amount equal to the unpaid Reimbursement Obligation and the Administrative Agent shall give each Lender prompt notice thereof and of the amount of the Revolving Loan to be made available to the Administrative Agent not later than 12:00 p.m. Central time and (ii) if such conditions would not permit the making of Revolving Loans, the provisions of subsection (j) of this Section shall apply. The limitations set forth in the second sentence of Section 2.1.(a) shall not apply to any borrowing of Base Rate Loans under this subsection.
(f)
Effect of Letters of Credit on Revolving Commitments
. Upon the issuance by the Issuing Bank of any Letter of Credit and until such Letter of Credit shall have expired or been cancelled, the Revolving Commitment of each Lender shall be deemed to be utilized for all purposes of this Agreement in an amount equal to the product of (i) such Lender's Revolving Commitment Percentage and (ii) the sum of (A) the Stated Amount of such Letter of Credit plus (B) any related Reimbursement Obligations then outstanding.
(g)
Issuing Bank's Duties Regarding Letters of Credit; Unconditional Nature of Reimbursement Obligations
. In examining documents presented in connection with drawings under Letters of Credit and making payments under such Letters of Credit against such documents, the Issuing Bank shall only be required to use the same standard of care as it uses in connection with examining documents presented in connection with drawings under letters of credit in which it has not sold participations and making payments under such letters of credit. The Borrower assumes all risks of the acts and omissions of, or misuse of the Letters of Credit by, the respective beneficiaries of such Letters of Credit. In furtherance and not in limitation of the foregoing, none of the Issuing Bank, Administrative Agent or any of the Lenders shall be responsible for, and the Borrower's obligations in respect of Letters of Credit shall not be affected in any manner by, (i) the form, validity, sufficiency, accuracy, genuineness or legal effects of any document submitted by any party in connection with the application for and issuance of or any drawing honored under any Letter of Credit even if such document should in fact prove to be in any or all respects invalid, insufficient, inaccurate, fraudulent or forged; (ii) the validity or sufficiency of any instrument transferring or assigning or purporting to transfer or assign any Letter of Credit, or the rights or benefits thereunder or proceeds thereof, in whole or in part, which may prove to be invalid or ineffective for any reason; (iii) failure of the beneficiary of any Letter of Credit to comply fully with conditions required in order to draw upon such Letter of Credit (provided, however, the within limitation shall not affect Issuing Bank's liability for paying a drawing under any Letter of Credit when the beneficiary of such Letter of Credit has not substantially complied with the requirements imposed by such Letter of Credit for such drawing; provided further, Issuing Bank shall have no duty to verify the existence or reasonableness of any act or condition referenced in or in connection with, or any statement in or in connection with, any drawing or presentment under any Letter of Credit); (iv) errors, omissions, interruptions or delays in transmission or delivery of any messages, by mail, cable, facsimile, electronic mail, telecopy or otherwise, whether or not they be in cipher; (v) errors in interpretation of technical terms; (vi) any loss or delay in the transmission or otherwise of any document required in order to make a drawing under any Letter of Credit, or of the proceeds thereof; (vii) the misapplication by the beneficiary of any Letter of Credit, or of the proceeds of any drawing under any Letter of Credit; or (viii) any consequences arising from causes beyond the control of the Issuing Bank, Administrative Agent or the Lenders. None of the above shall affect, impair or prevent the vesting of any of the Issuing Bank's or Administrative Agent's rights or powers hereunder. Any action taken or omitted to be taken by the Issuing Bank under or in connection with any Letter of Credit, if taken or omitted in the absence of gross
negligence or willful misconduct (as determined by a court of competent jurisdiction in a final, non-appealable judgment), shall not create against the Issuing Bank any liability to the Borrower, the Administrative Agent or any Lender. In this connection, the obligation of the Borrower to reimburse the Issuing Bank for any drawing made under any Letter of Credit, and to repay any Revolving Loan made pursuant to the second sentence of the immediately preceding subsection (e), shall be absolute, unconditional and irrevocable and shall be paid strictly in accordance with the terms of this Agreement or any other applicable Letter of Credit Document under all circumstances whatsoever, including without limitation, the following circumstances: (A) any lack of validity or enforceability of any Letter of Credit Document or any term or provisions therein; (B) any amendment or waiver of or any consent to departure from all or any of the Letter of Credit Documents; (C) the existence of any claim, setoff, defense or other right which the Borrower may have at any time against the Issuing Bank, the Administrative Agent or any Lender, any beneficiary of a Letter of Credit or any other Person, whether in connection with this Agreement, the transactions contemplated hereby or in the Letter of Credit Documents or any unrelated transaction; (D) any breach of contract or dispute between the Borrower, the Issuing Bank, the Administrative Agent, any Lender or any other Person; (E) any demand, statement or any other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein or made in connection therewith being untrue or inaccurate in any respect whatsoever; (F) any non-application or misapplication by the beneficiary of a Letter of Credit or of the proceeds of any drawing under such Letter of Credit; (G) payment by the Issuing Bank under any Letter of Credit against presentation of a draft or certificate which does not strictly comply, but which does substantially comply, with the terms of such Letter of Credit; and (H) any other act, omission to act, delay or circumstance whatsoever that might, but for the provisions of this Section, constitute a legal or equitable defense to or discharge of the Borrower's Reimbursement Obligations.
(h)
Amendments, Etc
. The issuance by the Issuing Bank of any amendment, supplement or other modification to any Letter of Credit shall be subject to the same conditions applicable under this Agreement to the issuance of new Letters of Credit (including, without limitation, that the request therefor be made through the Issuing Bank), and no such amendment, supplement or other modification shall be issued unless either (i) the respective Letter of Credit affected thereby would have complied with such conditions had it originally been issued hereunder in such amended, supplemented or modified form or (ii) the Administrative Agent and Requisite Lenders (or all of the Lenders if required by Section 13.7.) shall have consented thereto. In connection with any such amendment, supplement or other modification, the Borrower shall pay the fees, if any, payable under the last sentence of Section 3.5.(c).
(i)
Lenders' Participation in Letters of Credit
. Immediately upon the issuance by the Issuing Bank of any Letter of Credit each Lender shall be deemed to have absolutely, irrevocably and unconditionally purchased and received from the Issuing Bank, without recourse or warranty, an undivided interest and participation to the extent of such Lender's Revolving Commitment Percentage of the liability of the Issuing Bank with respect to such Letter of Credit and each Lender thereby shall absolutely, unconditionally and irrevocably assume, as primary obligor and not as surety, and shall be unconditionally obligated to the Issuing Bank to pay and discharge when due, such Lender's Revolving Commitment Percentage of the Issuing Bank's liability under such Letter of Credit. In addition, upon the making of each payment by a Lender to the Administrative Agent for the account of the Issuing Bank in respect of any Letter of Credit pursuant to the immediately following subsection (j), such Lender shall, automatically and without any further action on the part of the Issuing Bank, Administrative Agent or such Lender, acquire (i) a participation in an amount equal to such payment in the Reimbursement Obligation owing to the Issuing Bank by the Borrower in respect of such Letter of Credit and (ii) a participation in a percentage equal to such Lender's Revolving Commitment Percentage in any interest or
other amounts payable by the Borrower in respect of such Reimbursement Obligation (other than the Fees payable to the Issuing Bank pursuant to the second and the last sentences of Section 3.5.(c)).
(j)
Payment Obligation of Lenders
. Each Lender severally agrees to pay to the Administrative Agent, for the account of the Issuing Bank, on demand in immediately available funds in Dollars the amount of such Lender's Revolving Commitment Percentage of each drawing paid by the Issuing Bank under each Letter of Credit to the extent such amount is not reimbursed by the Borrower pursuant to the immediately preceding subsection (d); provided, however, that in respect of any drawing under any Letter of Credit, the maximum amount that any Lender shall be required to fund, whether as a Revolving Loan or as a participation, shall not exceed such Lender's Revolving Commitment Percentage of such drawing. If the notice referenced in the second sentence of Section 2.4.(e) is received by a Lender not later than 11:00 a.m. Central time, then such Lender shall make such payment available to the Administrative Agent not later than 2:00 p.m. Central time on the date of demand therefor; otherwise, such payment shall be made available to the Administrative Agent not later than 1:00 p.m. Central time on the next succeeding Business Day. Each Lender's obligation to make such payments to the Administrative Agent under this subsection, and the Administrative Agent's right to receive the same for the account of the Issuing Bank, shall be absolute, irrevocable and unconditional and shall not be affected in any way by any circumstance whatsoever, including without limitation, (i) the failure of any other Lender to make its payment under this subsection, (ii) the financial condition of the Borrower, the Parent or any other Loan Party, (iii) the existence of any Default or Event of Default, including any Event of Default described in Sections 11.1.(e) or (f) or (iv) the termination of the Revolving Commitments. Each such payment to the Administrative Agent for the account of the Issuing Bank shall be made without any offset, abatement, withholding or deduction whatsoever.
(k)
Information to Lenders
. Promptly following any change in Letters of Credit outstanding, the Issuing Bank shall deliver to the Administrative Agent, who shall promptly deliver the same to each Lender and the Borrower a notice describing the aggregate amount of all Letters of Credit outstanding at such time. Upon the request of any Lender from time to time, the Issuing Bank shall deliver any other information reasonably requested by such Lender with respect to each Letter of Credit then outstanding. Other than as set forth in this subsection, the Issuing Bank shall have no duty to notify the Lenders regarding the issuance or other matters regarding Letters of Credit issued hereunder. The failure of the Issuing Bank to perform its requirements under this subsection shall not relieve any Lender from its obligations under the immediately preceding subsection (j).
Section 2.3.
Swingline Loans.
(a)
Swingline Loans
. Subject to the terms and conditions hereof, including without limitation Section 2.15., the Swingline Lender agrees to make Swingline Loans to the Borrower, during the period from the Effective Date to but excluding the Swingline Maturity Date, in an aggregate principal amount at any one time outstanding up to, but not exceeding, $30,000,000, as such amount may be reduced from time to time in accordance with the terms hereof. If at any time the aggregate principal amount of the Swingline Loans outstanding at such time exceeds the Swingline Commitment in effect at such time, the Borrower shall immediately pay the Administrative Agent for the account of the Swingline Lender the amount of such excess. Subject to the terms and conditions of this Agreement, the Borrower may borrow, repay and reborrow Swingline Loans hereunder. The borrowing of a Swingline Loan shall not constitute usage of any Lender's Revolving Commitment for purposes of calculation of the fee payable under Section 3.5.(b).
(b)
Procedure for Borrowing Swingline Loans
. The Borrower shall give the Administrative Agent and the Swingline Lender notice pursuant to a Notice of Swingline Borrowing or telephonic notice of each borrowing of a Swingline Loan. Each Notice of Swingline Borrowing shall be delivered to the Swingline Lender no later than 11:00 a.m. Central time on the proposed date of such borrowing. Any telephonic notice shall include all information to be specified in a written Notice of Swingline Borrowing and shall be promptly confirmed in writing by the Borrower pursuant to a Notice of Swingline Borrowing sent to the Swingline Lender by telecopy on the same day of the giving of such telephonic notice. Not later than 1:00 p.m. Central time on the date of the requested Swingline Loan and subject to satisfaction of the applicable conditions set forth in Article 6.2. for such borrowing, the Swingline Lender will make the proceeds of such Swingline Loan available to the Borrower in Dollars, in immediately available funds, at the account specified by the Borrower in the Notice of Swingline Borrowing.
(c)
Interest
. Swingline Loans shall bear interest at a per annum rate equal to the Base Rate as in effect from time to time plus the Applicable Margin or at such other rate or rates as the Borrower and the Swingline Lender may agree from time to time in writing. Interest on Swingline Loans is solely for the account of the Swingline Lender (except to the extent a Lender acquires a participating interest in a Swingline Loan pursuant to the following subsection (e)). All accrued and unpaid interest on Swingline Loans shall be payable on the dates and in the manner provided in Section 2.4. with respect to interest on Base Rate Loans (except as the Swingline Lender and the Borrower may otherwise agree in writing in connection with any particular Swingline Loan).
(d)
Swingline Loan Amounts, Etc
. Each Swingline Loan shall be in the minimum amount of $100,000 and integral multiples of $1,000 in excess thereof, or such other minimum amounts agreed to by the Swingline Lender and the Borrower. Any voluntary prepayment of a Swingline Loan must be in integral multiples of $100,000 or the aggregate principal amount of all outstanding Swingline Loans (or such other minimum amounts upon which the Swingline Lender and the Borrower may agree) and in connection with any such prepayment, the Borrower must give the Swingline Lender and the Administrative Agent prior written notice thereof no later than 12:00 p.m. Central time on the day prior to the date of such prepayment. The Swingline Loans shall, in addition to this Agreement, be evidenced by the Swingline Note.
(e)
Repayment and Participations of Swingline Loans
. The Borrower agrees to repay each Swingline Loan within one Business Day of demand therefor by the Swingline Lender and, in any event, within five (5) Business Days after the date such Swingline Loan was made; provided, that the proceeds of a Swingline Loan may not be used to pay a Swingline Loan. Notwithstanding the foregoing, the Borrower shall repay the entire outstanding principal amount of, and all accrued but unpaid interest on, the Swingline Loans on the Swingline Maturity Date (or such earlier date as the Swingline Lender and the Borrower may agree in writing). In lieu of demanding repayment of any outstanding Swingline Loan from the Borrower, the Swingline Lender may, on behalf of the Borrower (which hereby irrevocably directs the Swingline Lender to act on its behalf), request a borrowing of Revolving Loans that are Base Rate Loans from the Lenders in an amount equal to the principal balance of such Swingline Loan. The amount limitations contained in the second sentence of Section 2.1.(a) shall not apply to any borrowing of such Revolving Loans made pursuant to this subsection. The Swingline Lender shall give notice to the Administrative Agent of any such borrowing of Revolving Loans not later than 11:00 a.m. Central time at least one Business Day prior to the proposed date of such borrowing. Promptly after receipt of such notice of borrowing of Revolving Loans from the Swingline Lender under the immediately preceding sentence,
the Administrative Agent shall notify each Lender of the proposed borrowing. Not later than 11:00 a.m. Central time on the proposed date of such borrowing, each Lender will make available to the Administrative Agent at the Principal Office for the account of the Swingline Lender, in immediately
available funds, the proceeds of the Revolving Loan to be made by such Lender. The Administrative Agent shall pay the proceeds of such Revolving Loans to the Swingline Lender, which shall apply such proceeds to repay such Swingline Loan. If the Lenders are prohibited from making Revolving Loans required to be made under this subsection for any reason whatsoever, including without limitation, the occurrence of any of the Defaults or Events of Default described in Sections 11.1.(e) or (f)), each Lender shall purchase from the Swingline Lender, without recourse or warranty, an undivided interest and participation to the extent of such Lender's Revolving Commitment Percentage of such Swingline Loan, by directly purchasing a participation in such Swingline Loan in such amount and paying the proceeds thereof to the Administrative Agent for the account of the Swingline Lender in Dollars and in immediately available funds. A Lender's obligation to purchase such a participation in a Swingline Loan shall be absolute and unconditional and shall not be affected by any circumstance whatsoever, including without limitation, (i) any claim of setoff, counterclaim, recoupment, defense or other right which such Lender or any other Person may have or claim against the Administrative Agent, the Swingline Lender or any other Person whatsoever, (ii) the occurrence or continuation of a Default or Event of Default (including without limitation, any of the Defaults or Events of Default described in Sections 11.1. (e) or (f)), or the termination of any Lender's Revolving Commitment, (iii) the existence (or alleged existence) of an event or condition which has had or could have a Material Adverse Effect, (iv) any breach of any Loan Document by the Administrative Agent, any Lender, the Borrower or any other Loan Party, or (v) any other circumstance, happening or event whatsoever, whether or not similar to any of the foregoing. If such amount is not in fact made available to the Swingline Lender by any Lender, the Swingline Lender shall be entitled to recover such amount on demand from such Lender, together with accrued interest thereon for each day from the date of demand thereof, at the Federal Funds Rate. If such Lender does not pay such amount forthwith upon the Swingline Lender's demand therefor, and until such time as such Lender makes the required payment, the Swingline Lender shall be deemed to continue to have outstanding Swingline Loans in the amount of such unpaid participation obligation for all purposes of the Loan Documents (other than those provisions requiring the other Lenders to purchase a participation therein). Further, such Lender shall be deemed to have assigned any and all payments made of principal and interest on its Revolving Loans, and any other amounts due it hereunder, to the Swingline Lender to fund Swingline Loans in the amount of the participation in Swingline Loans that such Lender failed to purchase pursuant to this Section until such amount has been purchased (as a result of such assignment or otherwise).
Section 2.4.
Rates and Payment of Interest on Loans.
(a)
Rates
. The Borrower promises to pay to the Administrative Agent for the account of each Lender interest on the unpaid principal amount of each Loan made by such Lender for the period from and including the date of the making of such Loan to but excluding the date such Loan shall be paid in full, at the following per annum rates:
(i)
during such periods as such Loan is a Base Rate Loan, at the Base Rate (as in effect from time to time), plus the Applicable Margin; and
(ii)
during such periods as such Loan is a LIBOR Loan, at LIBOR for such Loan for the Interest Period therefor, plus the Applicable Margin.
Notwithstanding the foregoing, while an Event of Default exists, the Borrower shall, upon and after the Administrative Agent's demand, pay to the Administrative Agent for the account of each Lender and the Issuing Bank, as the case may be, interest at the Post-Default Rate on the outstanding principal amount of any Loan made by such Lender, on all Reimbursement Obligations and on any other amount payable by
the Borrower hereunder or under the Notes held by such Lender to or for the account of such Lender (including without limitation, accrued but unpaid interest to the extent permitted under Applicable Law).
(b)
Credit Rating Election Event
.
In the event the Borrower obtains an Investment Grade Rating during the term of this Agreement, the Borrower may make a one-time irrevocable election upon written notice to the Administrative Agent (and the Administrative Agent shall promptly notify the Lenders thereof) to utilize its Credit Rating in determining the Applicable Margin (a “Credit Rating Election Event”), pursuant to the relevant table set forth in the definition of Applicable Margin.
(c)
Payment of Interest
. All accrued and unpaid interest on the outstanding principal amount of each Loan shall be payable (i) monthly in arrears on the first day of each month, commencing with the first full calendar month occurring after the Effective Date and (ii) on any date on which the principal balance of such Loan is due and payable in full (whether at maturity, due to acceleration or otherwise). Interest payable at the Post-Default Rate shall be payable from time to time on demand. All determinations by the Administrative Agent of an interest rate hereunder shall be conclusive and binding on the Lenders and the Borrower for all purposes, absent manifest error.
(d)
Borrower Information Used to Determine Applicable Interest Rates
. The parties understand that the applicable interest rate for the Obligations and certain fees set forth herein may be determined and/or adjusted from time to time based upon certain financial ratios and/or other information to be provided or certified to the Lenders by the Borrower (the “Borrower Information”). If it is subsequently determined that any such Borrower Information was incorrect (for whatever reason, including without limitation because of a subsequent restatement of earnings by the Borrower) at the time it was delivered to the Administrative Agent, and if the applicable interest rate or fees calculated for any period were lower than they should have been had the correct information been timely provided, then, such
interest rate and such fees for such period shall be automatically recalculated using correct Borrower Information. The Administrative Agent shall promptly notify the Borrower in writing of any additional interest and fees due because of such recalculation, and the Borrower shall pay such additional interest or fees due to the Administrative Agent, for the account of each Lender, within five (5) Business Days of receipt of such written notice. Any recalculation of interest or fees
required by this provision shall survive the termination of this Agreement, and this provision shall not in any way limit any of the Administrative Agent's, the Issuing Bank's, or any Lender's other rights under this Agreement.
Section 2.5.
Number of Interest Periods.
Notwithstanding anything to the contrary contained in this Agreement, there may be no more than eight (8)
different Interest Periods outstanding at the same time.
Section 2.6.
Repayment of Loans.
The Borrower shall repay the entire outstanding principal amount of, and all accrued but unpaid interest on, the Loans on the Maturity Date.
Section 2.7.
Prepayments.
(a)
Optional
. Subject to Section 5.4., the Borrower may prepay any Loan at any time without premium or penalty. The Borrower shall give the Administrative Agent at least three (3) Business Days prior written notice of the prepayment of any Loan. Each voluntary prepayment of Loans shall be in an aggregate minimum amount of $100,000 and integral multiples of $1,000 in excess thereof.
(b)
Mandatory
. If at any time the aggregate principal amount of all outstanding Revolving Loans and Swingline Loans, together with the aggregate amount of all Letter of Credit Liabilities, exceeds the aggregate amount of the Revolving Commitments, the Borrower shall immediately pay to the Administrative Agent for the account of the Lenders then holding Revolving Commitments (or if the Revolving Commitments have been terminated, then holding outstanding Revolving Loans, Swingline Loans and/or Letter of Credit Liabilities), the amount of such excess. All payments under this subsection (b) shall be applied to pay all amounts of principal outstanding on the Loans and any Reimbursement Obligations pro rata in accordance with Section 3.2. and if any Letters of Credit are outstanding at such time, the remainder, if any, shall be deposited into the Letter of Credit Collateral Account for application to any Reimbursement Obligations. If the Borrower is required to pay any outstanding LIBOR Loans by reason of this Section prior to the end of the applicable Interest Period therefor, the Borrower shall pay all amounts due under Section 5.4.
Section 2.8.
Late Charges.
So long as the Post-Default Rate is not payable with respect to the Obligations as provided in Section 2.4., if any payment required under this Agreement is not paid within fifteen (15) days after it becomes due and payable, the Borrower shall pay a late charge for late payment to compensate the Lenders for the loss of use of funds and for the expenses of handling the delinquent payment, in an amount equal to three percent (3%) of such delinquent payment. Such late charge shall be paid in any event not later than the due date of the next subsequent installment of principal and/or interest. In the event the maturity of the Obligations hereunder occurs or is accelerated pursuant to Section 11.2., this Section shall apply only to payments overdue prior to the time of such acceleration. This Section shall not be deemed to be a waiver of the Lenders' right to accelerate payment of any of the Obligations as permitted under the terms of this Agreement.
Section 2.9.
Continuation.
So long as there exists no Default or Event of Default, the Borrower may on any Business Day, with respect to any LIBOR Loan, elect to maintain such LIBOR Loan or any portion thereof as a LIBOR Loan by selecting a new Interest Period for such LIBOR Loan. Each Continuation of a LIBOR Loan shall be in an aggregate minimum amount of $100,000 and integral multiples of $1,000 in excess of that amount, and each new Interest Period selected under this Section shall commence on the last day of the immediately preceding Interest Period. Each selection of a new Interest Period shall be made by the Borrower giving to the Administrative Agent a Notice of Continuation not later than 11:00 a.m. Central time on the third Business Day prior to the date of any such Continuation. Such notice by the Borrower of a Continuation shall be by telecopy, electronic mail or other similar form of communication in the form of a Notice of Continuation, specifying (a) the proposed date of such Continuation, (b) the LIBOR Loans and portions thereof subject to such Continuation and (c) the duration of the selected Interest Period, all of which shall be specified in such manner as is necessary to comply with all limitations on Loans outstanding hereunder. Each Notice of Continuation shall be irrevocable by and binding on the Borrower once given. Promptly after receipt of a Notice of Continuation, the Administrative Agent shall notify each Lender of the proposed Continuation. If the Borrower shall fail to select in a timely manner a new Interest Period for any LIBOR Loan in accordance with this Section, such Loan will automatically, on the last day of the current Interest Period therefor, continue as a LIBOR Loan with an Interest Period of one month; provided, however, that if a Default or Event of Default exists, such Loan will automatically, on the last day of the current Interest Period therefor, Convert into a Base Rate Loan notwithstanding the first sentence of Section 2.10. or the Borrower's failure to comply with any of the terms of such Section.
Section 2.10.
Conversion.
So long as there exists no Default or Event of Default, the Borrower may on any Business Day, upon the Borrower's giving of a Notice of Conversion to the Administrative Agent by telecopy, electronic mail or other similar form of communication, Convert all or a portion of a Loan of one Type into a Loan of another Type. Each Conversion of Base Rate Loans into LIBOR Loans shall be in an aggregate minimum amount of $100,000 and integral multiples of $1,000 in excess of that amount, and upon Conversion of a Base Rate Loan into a LIBOR Loan, the Borrower shall pay accrued interest to the date of Conversion on the principal amount so Converted in accordance with Section 2.4. Any Conversion of a LIBOR Loan into a Base Rate Loan shall be made on, and only on, the last day of an Interest Period for such LIBOR Loan. Each such Notice of Conversion shall be given not later than 11:00 a.m. Central time one Business Day prior to the date of any proposed Conversion into Base Rate Loans and three (3) Business Days prior to the date of any proposed Conversion into LIBOR Loans. Promptly after receipt of a Notice of Conversion, the Administrative Agent shall notify each Lender of the proposed Conversion. Subject to the restrictions specified above, each Notice of Conversion shall be by telecopy, electronic mail or other similar form of communication in the form of a Notice of Conversion specifying (a) the requested date of such Conversion, (b) the Type of Loan to be Converted, (c) the portion of such Type of Loan to be Converted, (d) the Type of Loan such Loan is to be Converted into and (e) if such Conversion is into a LIBOR Loan, the requested duration of the Interest Period of such Loan. Each Notice of Conversion shall be irrevocable by and binding on the Borrower once given.
Section 2.11.
Notes.
(a)
Notes
. The Revolving Loans made by each Lender shall, in addition to this Agreement, also be evidenced by a promissory note of the Borrower substantially in the form of
Exhibit H
(each a “Revolving Note”), payable to the order of such Lender in a principal amount equal to the amount of its Revolving Commitment as originally in effect and otherwise duly completed. The Swingline Loans made by the Swingline Lender to the Borrower shall, in addition to this Agreement, also be evidenced by a Swingline Note payable to the order of the Swingline Lender.
(b)
Records
. The date, amount, interest rate, Type and duration of Interest Periods (if applicable) of each Loan made by each Lender to the Borrower, and each payment made on account of the principal thereof, shall be recorded by such Lender on its books and such entries shall be binding on the Borrower absent manifest error; provided, however, that (i) the failure of a Lender to make any such record shall not affect the obligations of the Borrower under any of the Loan Documents and (ii) if there is a discrepancy between such records of a Lender and the statements of accounts maintained by the Administrative Agent pursuant to Section 3.8., in the absence of manifest error, the statements of account maintained by the Administrative Agent pursuant to Section 3.8. shall be controlling.
(c)
Lost, Stolen, Destroyed or Mutilated Notes
. Upon receipt by the Borrower of (i) written notice from a Lender that a Note of such Lender has been lost, stolen, destroyed, mutilated, inappropriately cancelled or inappropriately marked, and (ii)(A) in the case of loss, theft or destruction, an unsecured agreement of indemnity from such Lender in form reasonably satisfactory to the Borrower, or (B) in the case of mutilation, inappropriate cancellation or inappropriate marking, upon surrender and cancellation of such Note, the Borrower shall at no expense to Borrower execute and deliver to such Lender a new Note, identical in form and substance and dated the date of such lost, stolen, destroyed, mutilated, inappropriately cancelled or inappropriately marked Note.
Section 2.12.
Voluntary Reductions of the Revolving Commitment.
The Borrower may terminate or reduce the unused amount of the Revolving Commitments (for which purpose use of the Revolving Commitments shall be deemed to include the aggregate amount of all Letter of Credit Liabilities and the aggregate principal amount of all outstanding Swingline Loans) at any time and from time to time without penalty or premium upon not less than five (5) Business Days prior written notice to the Administrative Agent of each such termination or reduction, which notice shall specify the effective date thereof and the amount of any such reduction (which in the case of any partial reduction of the Revolving Commitments shall not be less than $5,000,000 and integral multiples of $1,000,000 in excess of that amount in the aggregate) and shall be irrevocable once given and effective only upon receipt by the Administrative Agent (“Commitment Reduction Notice”). Any such reduction shall reduce the Revolving Commitments of all Lenders on a pro rata basis. Promptly after receipt of a Commitment Reduction Notice the Administrative Agent shall notify each Lender of the proposed termination or Revolving Commitment reduction. The Revolving Commitments, once reduced or terminated pursuant to this Section, may not be increased or reinstated. The Borrower shall pay all interest and fees, on the Loans accrued to the date of such reduction or termination of the Revolving Commitments to the Administrative Agent for the account of the Lenders, including but not limited to any applicable compensation due to each Lender in accordance with Section 5.4. of this Agreement.
Section 2.13.
Extension of Maturity Date.
Subject to the terms of this Section 2.13., the Borrower shall have the right to extend the current Maturity Date by one (1) year by executing and delivering to the Administrative Agent at least ninety (90) days but not more than one hundred eighty (180) days prior to the current Maturity Date, a written notice of such extension (an “Extension Notice”). The Administrative Agent shall forward to each Lender a copy of such Extension Notice delivered to the Administrative Agent promptly upon receipt thereof. Subject to satisfaction of the following conditions, the Maturity Date shall be extended for one (1) year: (x) immediately prior to such extension and immediately after giving effect thereto, (A) no Default or Event of Default shall or would exist and (B) the representations and warranties made or deemed made by the Borrower and each other Loan Party in the Loan Documents to which any of them is a party, shall be true and correct in all material respects on and as of the date of such extension with the same force and effect as if made on and as of such date except to the extent that such representations and warranties expressly relate solely to an earlier date (in which case such representations and warranties shall have been true and correct in all material respects on and as of such earlier date) and except for changes in factual circumstances specifically and expressly permitted under the Loan Documents and (y) the Borrower shall have paid the Fees payable under Section 3.5.(d). At any time prior to the effectiveness of any such extension, upon the Administrative Agent's request, the Borrower shall deliver to the Administrative Agent a certificate from a Senior Officer certifying the matters referred to in the immediately preceding clauses (x)(A) and (x)(B). The Maturity Date may be extended only one time pursuant to this Section 2.13.
Section 2.14.
Expiration or Maturity Date of Letters of Credit Past Maturity Date.
If on the date that is thirty (30) days prior to the Maturity Date or any such other date upon which the Revolving Commitments are terminated or reduced to zero (whether voluntarily, by reason of the occurrence of an Event of Default or otherwise), there are any Letters of Credit outstanding hereunder, the Borrower shall, on such date, pay to the Administrative Agent, for its benefit and the benefit of the Lenders and the Issuing Bank, an amount of money equal to the Stated Amount of such Letter(s) of Credit for deposit into the Letter of Credit Collateral Account; provided, that the expiration date of such Letter of Credit shall be no later than the one year anniversary of the Maturity Date. If a drawing pursuant to any such Letter of Credit occurs on or prior to the expiration date of such Letter of Credit, the Borrower
authorizes the Administrative Agent to use the monies deposited in the Letter of Credit Collateral Account to reimburse the Issuing Bank for the payment made by the Issuing Bank to the beneficiary with respect to such drawing or the payee with respect to such presentment. If no drawing occurs on or prior to the expiration date of such Letter of Credit, the Administrative Agent shall pay to the Borrower (or to whomever else may be legally entitled thereto) the monies deposited in the Letter of Credit Collateral Account with respect to such outstanding Letter of Credit, together with all interest accrued thereon, on or before the date thirty (30) days after the expiration date of such Letter of Credit.
Section 2.15.
Amount Limitations.
Notwithstanding any other term of this Agreement or any other Loan Document, no Lender shall be required to make any Loan, the Issuing Bank shall not be required to issue any Letter of Credit and no reduction of the Revolving Commitments pursuant to Section 2.12. shall take effect, if immediately after the making of such Loan, the issuance of such Letter of Credit or such reduction in the Revolving Commitments the aggregate principal amount of all outstanding Revolving Loans and Swingline Loans, together with the aggregate amount of all Letter of Credit Liabilities, would exceed the aggregate amount of the Revolving Commitments at such time.
Section 2.16.
Funds Transfer Disbursements.
(a)
Generally
. The Borrower hereby authorizes the Administrative Agent to disburse the proceeds of any Loan made by the Lenders or any of their Affiliates pursuant to the Loan Documents as requested by an authorized representative of the Borrower to any of the accounts designated in the Transfer Authorizer Designation Form. The Borrower agrees to be bound by any transfer request: (i) authorized or transmitted by the Borrower; or, (ii) made in the Borrower's name and accepted by the Administrative Agent in good faith and in compliance with these transfer instructions, even if not properly authorized by the Borrower. The Borrower further agrees and acknowledges that the Administrative Agent may rely solely on any bank routing number or identifying bank account number or name provided by the Borrower to effect a wire or funds transfer even if the information provided by the Borrower identifies a different bank or account holder than named by the Borrower. The Administrative Agent will inform Borrower of any errors actually known by Administrative Agent in any information provided by Borrower, but is not obligated or required in any way to take any actions to detect errors in information provided by the Borrower. If the Administrative Agent takes any actions in an attempt to detect errors in the transmission or content of transfer or requests or takes any actions in an attempt to detect unauthorized funds transfer requests, the Borrower agrees that no matter how many times the Administrative Agent takes these actions the Administrative Agent will not in any situation be liable for failing to take or correctly perform these actions in the future and such actions shall not become any part of the transfer disbursement procedures authorized under this provision, the Loan Documents, or any agreement between the Administrative Agent and the Borrower or between any Lender and the Borrower. The Borrower agrees to notify the Administrative Agent of any errors in the transfer of any funds or of any unauthorized or improperly authorized transfer requests within fourteen (14) days after the Administrative Agent's confirmation to the Borrower of such transfer.
(b)
Funds Transfer
. The Administrative Agent will, in its sole discretion, determine the funds transfer system and the means by which each transfer will be made. The Administrative Agent may delay or refuse to accept a funds transfer request if the transfer would: (i) violate the terms of this authorization, (ii) require use of a bank unacceptable to the Administrative Agent or any Lender or prohibited by any Governmental Authority, (iii) cause the Administrative Agent or any Lender to violate
any Federal Reserve or other regulatory risk control program or guideline, or (iv) otherwise cause the Administrative Agent or any Lender to violate any Applicable Law or regulation.
(c)
Limitation of Liability
. Neither the Administrative Agent, the Issuing Bank nor any Lender shall be liable to the Borrower or any other parties for (i) errors, acts or failures to act of others, including other entities, banks, communications carriers or clearinghouses, through which the Borrower's transfers may be made or information received or transmitted, and no such entity shall be deemed an agent of the Administrative Agent, the Issuing Bank or any Lender, (ii) any loss, liability or delay caused by fires, earthquakes, wars, civil disturbances, power surges or failures, acts of government, labor disputes, failures in communications networks, legal constraints or other events beyond Administrative Agent's, Issuing Bank's or any Lender's control, or (iii) any special, consequential, indirect or punitive damages, whether or not (x) any claim for these damages is based on tort or contract or (y) the Administrative Agent, the Issuing Bank, any Lender or the Borrower knew or should have known the likelihood of these damages in any situation. Neither the Administrative Agent, the Issuing Bank nor any Lender makes any representations or warranties other than those expressly made in this Agreement.
Section 2.17.
Increase in Revolving Commitments.
The Borrower shall have the right to request increases in the aggregate amount of the Revolving Commitments by providing written notice to the Administrative Agent, which notice shall be irrevocable once given;
provided
,
however
, that the aggregate amount of such increases under this Agreement and that certain Eighth Amended and Restated Credit Agreement, dated as of the date hereof, by and among the Borrower, the Lenders party hereto and the Administrative Agent (as amended from time to time), shall not exceed $400,000,000. Each such increase in the Revolving Commitments must be an aggregate minimum amount of $25,000,000 and integral multiples of $5,000,000 in excess thereof (or such other amounts as may be acceptable to the Administrative Agent and the Borrower). The Administrative Agent, in consultation with the Borrower, shall manage all aspects of the syndication of such increase in the Revolving Commitments, including decisions as to the selection of the existing Lenders and/or other banks, financial institutions and other institutional lenders to be approached with respect to such increase and the allocations of the increase in the Revolving Commitments among such existing Lenders and/or other banks, financial institutions and other institutional lenders. No Lender shall be obligated in any way whatsoever to increase its Revolving Commitment or provide a new Revolving Commitment, and any new Lender becoming a party to this Agreement in connection with any such requested increase must be an Eligible Assignee. If a new Lender becomes a party to this Agreement, or if any existing Lender is increasing its Revolving Commitment, such Lender shall on the date it becomes a Lender hereunder (or in the case of an existing Lender, increases its Revolving Commitment) (and as a condition thereto) purchase from the other Lenders its Revolving Commitment Percentage (determined with respect to the Lenders' respective Revolving Commitments and after giving effect to the increase of Revolving Commitments) of any outstanding Revolving Loans, by making available to the Administrative Agent for the account of such other Lenders, in same day funds, an amount equal to the sum of (A) the portion of the outstanding principal amount of such Revolving Loans to be purchased by such Lender,
plus
(B) the aggregate amount of payments previously made by the other Lenders under Section 2.2.(j) that have not been repaid,
plus
(C) interest accrued and unpaid to and as of such date on such portion of the outstanding principal amount of such Revolving Loans. The Borrower shall pay to the Lenders amounts payable, if any, to such Lenders under Section 5.4. as a result of the prepayment of any such Revolving Loans. Effecting the increase of the Revolving Commitments under this Section is subject to the following conditions precedent: (x) no Default or Event of Default shall be in existence on the effective date of such increase, (y) the representations and warranties made or deemed made by the Borrower or any other Loan Party in any Loan Document to which such Loan Party is a party shall be true and correct on the
effective date of such increase except to the extent that such representations and warranties expressly relate solely to an earlier date (in which case such representations and warranties shall have been true and correct on and as of such earlier date) and except for changes in factual circumstances specifically and expressly permitted hereunder, and (z) the Administrative Agent shall have received each of the following, in form and substance satisfactory to the Administrative Agent: (i) if not previously delivered to the Administrative Agent, copies certified by the Secretary or Assistant Secretary of (A) all partnership or other necessary action taken by the Borrower to authorize such increase and (B) all corporate, partnership, member or other necessary action taken by each Guarantor authorizing the guaranty of such increase; and (ii) an opinion of counsel to the Borrower and the Guarantors, and addressed to the Administrative Agent and the Lenders covering such matters as reasonably requested by the Administrative Agent; and (iii) new Revolving Notes executed by the Borrower, payable to any new Lenders and replacement Revolving Notes executed by the Borrower, payable to any existing Lenders increasing their Revolving Commitments, in the amount of such Lender's Revolving Commitment at the time of the effectiveness of the applicable increase in the aggregate amount of the Revolving Commitments. In connection with any increase in the aggregate amount of the Revolving Commitments pursuant to this Section 2.17. any Lender becoming a party hereto shall execute such documents and agreements as the Administrative Agent may reasonably request.
Article III. Payments, Fees and Other General Provisions
Section 3.1.
Payments.
(a)
Payments by Borrower
. Except to the extent otherwise provided herein, all payments of principal, interest, Fees and other amounts to be made by the Borrower under this Agreement, the Notes or any other Loan Document shall be made in Dollars, in immediately available funds, without setoff, deduction or counterclaim, to the Administrative Agent at the Principal Office, not later than 1:00 p.m. Central time on the date on which such payment shall become due (each such payment made after such time on such due date to be deemed to have been made on the next succeeding Business Day). Subject to Section 11.5., the Borrower shall, at the time of making each payment under this Agreement or any other Loan Document, specify to the Administrative Agent the amounts payable by the Borrower hereunder to which such payment is to be applied. Each payment received by the Administrative Agent for the account of a Lender under this Agreement or any Note shall be paid to such Lender by wire transfer of immediately available funds in accordance with the wiring instructions provided by such Lender to the Administrative Agent from time to time, for the account of such Lender at the applicable Lending Office of such Lender. Each payment received by the Administrative Agent for the account of a Lender under this Agreement or any Note shall be paid to such Lender by wire transfer of immediately available funds in accordance with the wiring instructions provided by such Lender to the Administrative Agent from time to time, for the account of such Lender at the applicable Lending Office of such Lender. Each payment received by the Administrative Agent for the account of the Issuing Bank under this Agreement shall be paid to the Issuing Bank by wire transfer of immediately available funds in accordance with the wiring instructions provided by the Issuing Bank to the Administrative Agent from time to time, for the account of the Issuing Bank. In the event the Administrative Agent fails to pay such amounts to such Lender or the Issuing Bank, as the case may be, within one Business Day of receipt of such amounts, the Administrative Agent shall pay interest on such amount at a rate per annum equal to the Federal Funds Rate from time to time in effect. If the due date of any payment under this Agreement or any other Loan Document would otherwise fall on a day which is not a Business Day such date shall be extended to the next succeeding Business Day and interest shall continue to accrue at the rate, if any, applicable to such payment for the period of such extension.
(b)
Presumptions Regarding Payments by Borrower
. Unless the Administrative Agent shall have received notice from the Borrower prior to the date on which any payment is due to the Administrative Agent for the account of the Lenders or the Issuing Bank hereunder that the Borrower will not make such payment, the Administrative Agent may assume that the Borrower has made such payment on such date in accordance herewith and may (but shall not be obligated to), in reliance upon such assumption, distribute to the Lenders or the Issuing Bank, as the case may be, the amount due. In such event, if the Borrower has not in fact made such payment, then each of the Lenders or the Issuing Bank, as the case may be, severally agrees to repay to the Administrative Agent on demand that amount so distributed to such Lender or the Issuing Bank, with interest thereon, for each day from and including the date such amount is distributed to it to but excluding the date of payment to the Administrative Agent, at the greater of the Federal Funds Rate and a rate determined by the Administrative Agent in accordance with banking industry rules on interbank compensation.
Section 3.2.
Pro Rata Treatment.
Except to the extent otherwise provided herein: (a) each borrowing from Lenders under Section 2.1.(a), 2.2.(e) and 2.3.(e) shall be made from the Lenders, each payment of the fees under Sections 3.5.(a), 3.5.(b) and 3.5.(d) shall be made for the account of the Lenders, and each termination or reduction of the amount of the Revolving Commitments under Section 2.12. shall be applied to the respective Revolving Commitments of the Lenders, pro rata according to the amounts of their respective Revolving Commitments; (b) each payment or prepayment of principal of Revolving Loans by the Borrower shall be made for the account of the Lenders pro rata in accordance with the respective unpaid principal amounts of the Revolving Loans held by them, provided that if immediately prior to giving effect to any such payment in respect of any Revolving Loans the outstanding principal amount of the Revolving Loans shall not be held by the Lenders pro rata in accordance with their respective Revolving Commitments in effect at the time such Loans were made, then such payment shall be applied to the Revolving Loans in such manner as shall result, as nearly as is practicable, in the outstanding principal amount of the Revolving Loans being held by the Lenders pro rata in accordance with their respective Revolving Commitments; (c) each payment of interest on Revolving Loans by the Borrower shall be made for the account of the Lenders pro rata in accordance with the amounts of interest on such Revolving Loans then due and payable to the respective Lenders; (d) the making, Conversion and Continuation of Loans of a particular Type (other than Conversions provided for by Section 5.1.) shall be made pro rata among the Lenders according to the amounts of their respective Loans and the then current Interest Period for each Lender's portion of each Loan of such Type shall be coterminous; (e) the Lenders' participation in, and payment obligations in respect of, Swingline Loans under Section 2.3., shall be in accordance with their respective Revolving Commitment Percentages; and (f) the Lenders' participation in, and payment obligations in respect of, Letters of Credit under Section 2.2., shall be in accordance with their respective Revolving Commitment Percentages. Any payment or prepayment of principal or interest made (i) during the existence of a Default or Event of Default shall be made for the account of the Lenders in accordance with the order set forth in Section 11.5. and (ii) pursuant to Section 2.7.(b) shall be made for the account of the Lenders holding Revolving Commitments (or, if the Revolving Commitments have been terminated, holding Revolving Loans and Letter of Credit Liabilities) in accordance with the order set forth in Section 11.5. All payments of principal, interest, fees and other amounts in respect of the Swingline Loans shall be for the account of the Swingline Lender only (except to the extent any Lender shall have acquired a participating interest in any such Swingline Loan pursuant to Section 2.3.(e), in which case such payments shall be pro rata in accordance with such participating interests).
Section 3.3.
Sharing of Payments, Etc.
If a Lender shall obtain payment of any principal of, or interest on, any Loan under this Agreement or shall obtain payment on any other Obligation owing by the Borrower or any other Loan Party through the exercise of any right of setoff, banker's lien, counterclaim or similar right or otherwise or through voluntary prepayments directly to a Lender or other payments made by or on behalf of the Borrower or any other Loan Party to a Lender (other than any payment in respect of Specified Derivatives Obligations) not in accordance with the terms of this Agreement and such payment should be distributed to the Lenders in accordance with Section 3.2. or Section 11.5., such Lender shall promptly purchase from such other Lenders participations in (or, if and to the extent specified by such Lender, direct interests in) the Loans made by the other Lenders or other Obligations owed to such other Lenders in such amounts, and make such other adjustments from time to time as shall be equitable, to the end that all the Lenders shall share the benefit of such payment (net of any reasonable expenses which may actually be incurred by such Lender in obtaining or preserving such benefit) in accordance with the requirements of Section 3.2. or Section 11.5., as applicable. To such end, all the Lenders shall make appropriate adjustments among themselves (by the resale of participations sold or otherwise) if such payment is rescinded or must otherwise be restored. The Borrower agrees that any Lender so purchasing a participation (or direct interest) in the Loans or other Obligations owed to such other Lenders may exercise all rights of setoff, banker's lien, counterclaim or similar rights with the respect to such participation as fully as if such Lender were a direct holder of Loans in the amount of such participation. Nothing contained herein shall require any Lender to exercise any such right or shall affect the right of any Lender to exercise and retain the benefits of exercising, any such right with respect to any other indebtedness or obligation of the Borrower.
Section 3.4.
Several Obligations.
No Lender shall be responsible for the failure of any other Lender to make a Loan or to perform any other obligation to be made or performed by such other Lender hereunder, and the failure of any Lender to make a Loan or to perform any other obligation to be made or performed by it hereunder shall not relieve the obligation of any other Lender to make any Loan or to perform any other obligation to be made or performed by such other Lender.
Section 3.5.
Fees.
(a)
Closing Fee
. On the Effective Date, the Borrower agrees to pay to the Administrative Agent and each Lender all loan fees as have been agreed to in writing by the Borrower and the Administrative Agent or each Lender, as applicable.
(b)
Facility Fees and Unused Fees
.
(i)
Unused Fee
. During the period from the Effective Date to but excluding the Maturity Date (or, if earlier, the occurrence of a Credit Rating Election Event), the Borrower agrees to pay to the Administrative Agent for the account of the Lenders an unused facility fee equal to the sum of the average daily amount by which the aggregate amount of the Revolving Commitments (as they may be reduced from time to time pursuant to Section 2.12. or increased pursuant to Section 2.17.) exceeds the aggregate outstanding principal balance of Revolving Loans and Letter of Credit Liabilities set forth in the table below multiplied by the corresponding per annum rate:
|
|
|
Amount by Which Revolving Commitments Exceed Revolving Loans and Letter of Credit Liabilities
|
Unused Fee
(percent per annum)
|
$0 to and including an amount equal to 50% of the aggregate amount of Revolving Commitments
|
0.25%
|
Greater than an amount equal to 50% of the aggregate amount of Revolving Commitments
|
0.30%
|
Such fee shall be computed on a daily basis for each calendar quarter during the term of this Agreement and shall be payable quarterly in arrears on the fifth day of each January, April, July and October during the term of this Agreement and on the Maturity Date or any earlier date of termination of the Revolving Commitments or reduction of the Revolving Commitments to zero. For the avoidance of doubt, for purposes of calculating an unused facility fee, the outstanding principal balance of Swingline Loans shall not be factored into the computation.
(ii)
Facility Fee
. Upon the occurrence of the Credit Rating Election Event until the Maturity Date, and so long as the Applicable Margin shall be determined by reference to the Credit Rating of the Borrower, the Borrower agrees to pay to the Administrative Agent for the account of the Lenders a facility fee equal to the average daily aggregate amount of the Revolving Commitments (whether or not utilized) times a rate per annum equal to the Applicable Facility Fee. Such fee shall be payable quarterly in arrears on the fifth day of each January, April, July and October during the term of this Agreement and on the Maturity Date or any earlier date of termination of the Revolving Commitments or reduction of the Revolving Commitments to zero. The Borrower acknowledges that the fee payable hereunder is a bona fide commitment fee and is intended as reasonable compensation to the Lenders for committing to make funds available to the Borrower as described herein and for no other purposes.
(c)
Letter of Credit Fees
. The Borrower agrees to pay to the Administrative Agent for the account of each Lender a letter of credit fee at a rate per annum equal to the Applicable Margin times the daily average Stated Amount of each Letter of Credit for the period from and including the date of issuance of such Letter of Credit (x) to and including the date such Letter of Credit expires or is cancelled or (y) to but excluding the date such Letter of Credit is drawn in full;
provided
,
however
, in no event shall the aggregate amount of such fee in respect of any Letter of Credit be less than $1,000. In addition to such fees, the Borrower shall pay to the Issuing Bank solely for its own account, a fronting fee in respect of each Letter of Credit at the rate equal to 0.15 percent (0.15%) per annum on the daily average Stated Amount of such Letter of Credit;
provided
,
however
, in no event shall the amount of such fronting fee in respect of any Letter of Credit be less than $1,500. The fees provided for in the immediately preceding two sentences shall be non-refundable and payable in arrears (i) quarterly on the first day of January, April, July and October, (ii) on the Maturity Date, (iii) on the date the Revolving Commitments are terminated or reduced to zero and (iv) thereafter from time to time on demand of the Administrative Agent. The Borrower shall pay directly to the Issuing Bank from time to time on demand all commissions, charges, costs and expenses in the amounts customarily charged by the Issuing Bank from time to time in like circumstances with respect to the issuance of each Letter of Credit, drawings, amendments and other transactions relating thereto.
(d)
Extension Fee
. If the Borrower exercises its right to extend the Maturity Date in accordance with Section 2.13., the Borrower agrees to pay to the Administrative Agent for the account of each Lender an extension fee equal to one-fifth of one percent (0.20%) of the amount of such Lender's Revolving Commitment (whether or not utilized) as of the day immediately prior to the then current Maturity Date (before giving effect to such extension). Such fee shall be paid to the Administrative Agent prior to, and as a condition to, such extension.
(e)
Administrative and Other Fees
. The Borrower agrees to pay the administrative and other fees of the Administrative Agent as provided in the Fee Letter and as may be otherwise agreed to in writing from time to time by the Borrower and the Administrative Agent.
Section 3.6.
Computations.
Unless otherwise expressly set forth herein, any accrued interest on any Loan, any Fees or other Obligations due hereunder shall be computed on the basis of a year of 360 days and the actual number of days elapsed.
Section 3.7.
Usury.
In no event shall the amount of interest due or payable on the Loans or other Obligations exceed the maximum rate of interest allowed by Applicable Law and, if any such payment is paid by the Borrower or any other Loan Party or received by any Lender, then such excess sum shall be credited as a payment of principal, unless the Borrower shall notify the respective Lender in writing that the Borrower elects to have such excess sum returned to it forthwith. It is the express intent of the parties hereto that the Borrower not pay and the Lenders not receive, directly or indirectly, in any manner whatsoever, interest in excess of that which may be lawfully paid by the Borrower under Applicable Law. The parties hereto hereby agree and stipulate that the only charge imposed upon the Borrower for the use of money in connection with this Agreement is and shall be the interest specifically described in Section 2.4.(a)(i) and (ii) and, with respect to Swingline Loans, in Section 2.3.(c). Notwithstanding the foregoing, the parties hereto further agree and stipulate that all agency fees, syndication fees, facility fees, letter of credit fees, underwriting fees, default charges, late charges, funding or “breakage” charges, increased cost charges, attorneys' fees and reimbursement for costs and expenses paid by the Administrative Agent or any Lender to third parties or for damages incurred by the Administrative Agent or any Lender, are charges made to compensate the Administrative Agent or any such Lender for underwriting or administrative services and costs or losses performed or incurred, and to be performed or incurred, by the Administrative Agent and the Lenders in connection with this Agreement and shall under no circumstances be deemed to be charges for the use of money. All charges other than charges for the use of money shall be fully earned and non-refundable when due.
Section 3.8.
Statements of Account.
The Administrative Agent will account to the Borrower monthly with a statement of Loans, accrued interest and Fees, charges and payments made pursuant to this Agreement and the other Loan Documents, and such account rendered by the Administrative Agent shall be deemed conclusive upon the Borrower absent manifest error. The failure of the Administrative Agent to deliver such a statement of accounts shall not relieve or discharge the Borrower from any of its obligations hereunder.
Section 3.9.
Defaulting Lenders.
Notwithstanding anything to the contrary contained in this Agreement, if any Lender becomes a Defaulting Lender, then, until such time as such Lender is no longer a Defaulting Lender, to the extent permitted by Applicable Law:
(a)
Waivers and Amendments
. Such Defaulting Lender's right to approve or disapprove any amendment, waiver or consent with respect to this Agreement shall be restricted as set forth in the definition of Requisite Lenders.
(b)
Defaulting Lender Waterfall
. Any payment of principal, interest, Fees or other amounts received by the Administrative Agent for the account of such Defaulting Lender (whether voluntary or mandatory, at maturity, pursuant to Article XI. or otherwise) or received by the Administrative Agent from a Defaulting Lender pursuant to Section 3.3. shall be applied at such time or times as may be determined by the Administrative Agent as follows:
first
, to the payment of any amounts owing by such Defaulting Lender to the Administrative Agent hereunder;
second
, to the payment on a pro rata basis of any amounts owing by such Defaulting Lender to the Issuing Bank or the Swingline Lender hereunder;
third
, to Cash Collateralize the Issuing Bank's Fronting Exposure with respect to such Defaulting Lender in accordance with subsection (e) below;
fourth
, as the Borrower may request (so long as no Default or Event of Default exists), to the funding of any Loan in respect of which such Defaulting Lender has failed to fund its portion thereof as required by this Agreement, as determined by the Administrative Agent;
fifth
, if so determined by the Administrative Agent and the Borrower, to be held in a deposit account and released pro rata in order to (x) satisfy such Defaulting Lender's potential future funding obligations with respect to Loans under this Agreement and (y) Cash Collateralize the Issuing Bank's future Fronting Exposure with respect to such Defaulting Lender with respect to future Letters of Credit issued under this Agreement, in accordance with subsection (e) below;
sixth
, to the payment of any amounts owing to the Lenders, the Issuing Bank or the Swingline Lender as a result of any judgment of a court of competent jurisdiction obtained by any Lender, the Issuing Bank or the Swingline Lender against such Defaulting Lender as a result of such Defaulting Lender's breach of its obligations under this Agreement;
seventh
, so long as no Default or Event of Default exists, to the payment of any amounts owing to the Borrower as a result of any judgment of a court of competent jurisdiction obtained by the Borrower against such Defaulting Lender as a result of such Defaulting Lender's breach of its obligations under this Agreement; and
eighth
, to such Defaulting Lender or as otherwise directed by a court of competent jurisdiction;
provided
that if (x) such payment is a payment of the principal amount of any Loans or amounts owing by such Defaulting Lender under Section 2.2.(j) in respect of Letters of Credit (such amounts “L/C Disbursements”), in respect of which such Defaulting Lender has not fully funded its appropriate share, and (y) such Loans were made or the related Letters of Credit were issued at a time when the conditions set forth in Article VI. were satisfied or waived, such payment shall be applied solely to pay the Loans of, and L/C Disbursements owed to, all Non-Defaulting Lenders on a pro rata basis prior to being applied to the payment of any Loans of, or L/C Disbursements owed to, such Defaulting Lender until such time as all Loans and funded and unfunded participations in Letter of Credit Liabilities and Swingline Loans are held by the Lenders pro rata in accordance with their respective Revolving Commitment Percentages (determined without giving effect to the immediately following subsection (d)). Any payments, prepayments or other amounts paid or payable to a Defaulting Lender that are applied (or held) to pay amounts owed by a Defaulting Lender or to post Cash Collateral pursuant to this subsection shall be deemed paid to and redirected by such Defaulting Lender, and each Lender irrevocably consents hereto.
(c)
Certain Fees
.
(i)
To the extent the Applicable Margin is determined by reference to the ratio of Total Indebtedness to Total Asset Value, no Defaulting Lender shall be entitled to receive any Fee payable under Section 3.5.(b)(i) for any period during which that Lender is a Defaulting Lender (and the Borrower shall not be required to pay any such fee that otherwise would have been required to have been paid to that Defaulting Lender). To the extent the Applicable Margin is determined by reference to the Credit Rating of the Borrower, each Defaulting Lender shall be entitled to receive the Fee payable under Section 3.5.(b)(ii) for any period during which that Lender is a Defaulting Lender only to the extent allocable to the sum of (1) the outstanding principal amount of the Revolving Loans funded by it, and (2) its Revolving Commitment Percentage of the Stated Amount of Letters of Credit for which it has provided Cash Collateral pursuant to the immediately following subsection (e).
(ii)
Each Defaulting Lender shall be entitled to receive letter of credit fees payable under Section 3.5.(c) for any period during which that Lender is a Defaulting Lender only to the extent allocable to its Revolving Commitment Percentage of the stated amount of Letters of Credit for which it has provided Cash Collateral pursuant to the immediately following subsection (e).
(iii)
With respect to any Fee not required to be paid to any Defaulting Lender pursuant to the immediately preceding clauses (i) or (ii), the Borrower shall (x) pay to each Non‑Defaulting Lender that portion of any such Fee otherwise payable to such Defaulting Lender with respect to such Defaulting Lender's participation in Letter of Credit Liabilities or Swingline Loans that has been reallocated to such Non‑Defaulting Lender pursuant to the immediately following subsection (d), (y) pay to each Issuing Bank and Swingline Lender, as applicable, the amount of any such Fee otherwise payable to such Defaulting Lender to the extent allocable to such Issuing Bank's or Swingline Lender's Fronting Exposure to such Defaulting Lender, and (z) not be required to pay the remaining amount of any such Fee.
(d)
Reallocation of Participations to Reduce Fronting Exposure
. All or any part of such Defaulting Lender's participation in Letter of Credit Liabilities and Swingline Loans shall be reallocated among the Non-Defaulting Lenders in accordance with their respective Revolving Commitment Percentages (determined without regard to such Defaulting Lender's Revolving Commitment) but only to the extent that (x) the conditions set forth in Article VI. are satisfied at the time of such reallocation (and, unless the Borrower shall have otherwise notified the Administrative Agent at such time, the Borrower shall be deemed to have represented and warranted that such conditions are satisfied at such time), and (y) such reallocation does not cause the aggregate Revolving Credit Exposure of any Non-Defaulting Lender to exceed such Non-Defaulting Lender's Revolving Commitment. No reallocation hereunder shall constitute a waiver or release of any claim of any party hereunder against a Defaulting Lender arising from that Lender having become a Defaulting Lender, including any claim of a Non-Defaulting Lender as a result of such Non-Defaulting Lender's increased exposure following such reallocation.
(e)
Cash Collateral, Repayment of Swingline Loans
.
(i)
If the reallocation described in the immediately preceding subsection (d) above cannot, or can only partially, be effected, the Borrower shall, without prejudice to any right or remedy available to it hereunder or under law, (x) first, prepay Swingline Loans in an amount equal to the Swingline Lender's Fronting Exposure and (y) second, Cash Collateralize the Issuing Bank's Fronting Exposure in accordance with the procedures set forth in this subsection.
(ii)
At any time that there shall exist a Defaulting Lender, within one (1) Business Day following the written request of the Administrative Agent or the Issuing Bank (with a copy to the Administrative Agent), the Borrower shall Cash Collateralize the Issuing Bank's Fronting Exposure with respect to such Defaulting Lender (determined after giving effect to the immediately preceding subsection (d) and any Cash Collateral provided by such Defaulting Lender) in an amount not less than the aggregate Fronting Exposure of the Issuing Bank with respect to Letters of Credit issued and outstanding at such time.
(iii)
The Borrower, and to the extent provided by any Defaulting Lender, such Defaulting Lender, hereby grant to the Administrative Agent, for the benefit of the Issuing Bank, and agree to maintain, a first priority security interest in all such Cash Collateral as security for the Defaulting Lenders' obligation to fund participations in respect of Letter of Credit Liabilities, to be applied pursuant to the immediately following clause (iv). If at any time the Administrative Agent determines that Cash Collateral is subject to any right or claim of any Person other than the Administrative Agent and the Issuing Bank as herein provided, or that the total amount of such Cash Collateral is less than the aggregate Fronting Exposure of the Issuing Bank with respect to Letters of Credit issued and outstanding at such time, the Borrower will, promptly upon demand by the Administrative Agent, pay or provide to the Administrative Agent additional Cash Collateral in an amount sufficient to eliminate such deficiency (after giving effect to any Cash Collateral provided by the Defaulting Lender).
(iv)
Notwithstanding anything to the contrary contained in this Agreement, Cash Collateral provided under this Section in respect of Letters of Credit shall be applied to the satisfaction of the Defaulting Lender's obligation to fund participations in respect of Letter of Credit Liabilities (including, as to Cash Collateral provided by a Defaulting Lender, any interest accrued on such obligation) for which the Cash Collateral was so provided, prior to any other application of such property as may otherwise be provided for herein.
(v)
Cash Collateral (or the appropriate portion thereof) provided to reduce the Issuing Bank's Fronting Exposure shall no longer be required to be held as Cash Collateral pursuant to this subsection following (x) the elimination of the applicable Fronting Exposure (including by the termination of Defaulting Lender status of the applicable Lender), or (y) the determination by the Administrative Agent and the Issuing Bank that there exists excess Cash Collateral;
provided
that, subject to the immediately preceding subsection (b), the Person providing Cash Collateral and the Issuing Bank may agree that Cash Collateral shall be held to support future anticipated Fronting Exposure or other obligations and
provided
further
that to the extent that such Cash Collateral was provided by the Borrower, such Cash Collateral shall remain subject to the security interest granted pursuant to the Loan Documents.
(f)
Defaulting Lender Cure
. If the Borrower, the Administrative Agent, the Swingline Lender and the Issuing Bank agree in writing that a Lender is no longer a Defaulting Lender, the Administrative Agent will so notify the parties hereto, whereupon as of the effective date specified in such notice and subject to any conditions set forth therein (which may include arrangements with respect to any Cash Collateral), that Lender will, to the extent applicable, purchase at par that portion of outstanding Loans of the other Lenders or take such other actions as the Administrative Agent may determine to be necessary to cause the Loans and funded and unfunded participations in Letters of Credit and Swingline Loans to be held pro rata by the Lenders in accordance with their respective Revolving Commitment Percentages (determined without giving effect to the immediately preceding subsection (d)), whereupon such Lender will cease to be a Defaulting Lender;
provided
that no adjustments will be made
retroactively with respect to Fees accrued or payments made by or on behalf of the Borrower while that Lender was a Defaulting Lender; and
provided
,
further
, that except to the extent otherwise expressly agreed by the affected parties, no change hereunder from Defaulting Lender to Lender will constitute a waiver or release of any claim of any party hereunder arising from that Lender's having been a Defaulting Lender.
(g)
New Swingline Loans/Letters of Credit
. So long as any Lender is a Defaulting Lender, (i) the Swingline Lender shall not be required to fund any Swingline Loans unless it is satisfied that it will have no Fronting Exposure after giving effect to such Swingline Loan and (ii) the Issuing Bank shall not be required to issue, extend, renew or increase any Letter of Credit unless it is satisfied that it will have no Fronting Exposure after giving effect thereto.
Section 3.10.
Taxes; Foreign Lenders.
(a)
Taxes Generally
. All payments by the Borrower of principal of, and interest on, the Loans and all other Obligations shall be made free and clear of and without deduction for any present or future excise, stamp or other taxes, fees, duties, levies, imposts, charges, deductions, withholdings or other charges of any nature whatsoever imposed by any taxing authority, but excluding (i) franchise taxes, (ii) any taxes (other than withholding taxes) that would not be imposed but for a connection between the Administrative Agent, the Issuing Bank or a Lender and the jurisdiction imposing such taxes (other than a connection arising solely by virtue of the activities of the Administrative Agent, the Issuing Bank or such Lender pursuant to or in respect of this Agreement or any other Loan Document), (iii) any taxes imposed on or measured by the Issuing Bank's or any Lender's assets, net income, receipts or branch profits and (iv) any taxes arising after the Agreement Date solely as a result of or attributable to a Lender changing its designated Lending Office after the date such Lender becomes a party hereto, and (v) any taxes imposed by Sections 1471 through Section 1474 of the Internal Revenue Code (including any official interpretations thereof, collectively “FATCA”) on any “withholdable payment” payable to such recipient as a result of the failure of such recipient to satisfy the applicable requirements as set forth in FATCA after December 31, 2012 (such non‑excluded items being collectively called “Taxes”). If any withholding or deduction from any payment to be made by the Borrower hereunder is required in respect of any Taxes pursuant to any Applicable Law, then the Borrower will:
(i)
pay directly to the relevant Governmental Authority the full amount required to be so withheld or deducted;
(ii)
promptly forward to the Administrative Agent an official receipt or other documentation satisfactory to the Administrative Agent evidencing such payment to such Governmental Authority; and
(iii)
pay to the Administrative Agent for its account or the account of the applicable Lender or the Issuing Bank, as the case may be, such additional amount or amounts as is necessary to ensure that the net amount actually received by the Administrative Agent, the Issuing Bank or such Lender will equal the full amount that the Administrative Agent, the Issuing Bank or such Lender would have received had no such withholding or deduction been required.
(b)
Tax Indemnification
. If the Borrower fails to pay any Taxes when due to the appropriate Governmental Authority or fails to remit to the Administrative Agent, for its account or the account of the Issuing Bank or respective Lender, as the case may be, the required receipts or other required documentary evidence, the Borrower shall indemnify the Administrative Agent, the Issuing Bank and the Lenders for any incremental Taxes, interest or penalties that may become payable by the Administrative
Agent, the Issuing Bank or any Lender as a result of any such failure. For purposes of this Section, a distribution hereunder by the Administrative Agent or any Lender to or for the account of any Lender shall be deemed a payment by the Borrower.
(c)
Tax Forms
. Prior to the date that any Lender or Participant organized under the laws of a jurisdiction other than that in which the Borrower is a resident for tax purposes becomes a party hereto, such Person shall deliver to the Borrower and the Administrative Agent such certificates, documents or other evidence, as required by the Internal Revenue Code or Treasury Regulations issued pursuant thereto (including Internal Revenue Service Forms W-8ECI and W-8BEN, as applicable, or appropriate successor forms), properly completed, currently effective and duly executed by such Lender or Participant establishing that payments to it hereunder and under the Notes are (i) not subject to United States Federal backup withholding tax and (ii) not subject to United States Federal withholding tax under the Internal Revenue Code. Each such Lender or Participant shall, to the extent it may lawfully do so, (x) deliver further copies of such forms or other appropriate certifications on or before the date that any such forms expire or become obsolete and after the occurrence of any event requiring a change in the most recent form delivered to the Borrower or the Administrative Agent and (y) obtain such extensions of the time for filing, and renew such forms and certifications thereof, as may be reasonably requested by the Borrower or the Administrative Agent. The Borrower shall not be required to pay any amount pursuant to the last sentence of subsection (a) above to any Lender or Participant that is organized under the laws of a jurisdiction other than that in which the Borrower is a resident for tax purposes or the Administrative Agent, if it is organized under the laws of a jurisdiction other than that in which the Borrower is a resident for tax purposes, such Lender, such Participant or the Administrative Agent, as applicable, fails to comply with the requirements of this subsection. If any such Lender or Participant, to the extent it may lawfully do so, fails to deliver the above forms or other documentation, then the Administrative Agent may withhold from such payment to such Lender such amounts as are required by the Internal Revenue Code. If any Governmental Authority asserts that the Administrative Agent did not properly withhold or backup withhold, as the case may be, any tax or other amount from payments made to or for the account of any Lender, such Lender shall indemnify the Administrative Agent therefor, including all penalties and interest, any taxes imposed by any jurisdiction on the amounts payable to the Administrative Agent under this Section, and costs and expenses (including all fees and disbursements of any law firm or other external counsel and the allocated cost of internal legal services and all disbursements of internal counsel) of the Administrative Agent. The obligation of the Lenders under this Section shall survive the termination of the Commitments, repayment of all Obligations and the resignation or replacement of the Administrative Agent.
(d)
USA Patriot Act Notice; Compliance
. In order for the Administrative Agent to comply with the USA Patriot Act of 2001 (Public Law 107-56), prior to any Lender or Participant that is organized under the laws of a jurisdiction outside of the United States of America becoming a party hereto, the Administrative Agent may request, and such Lender or Participant shall provide to the Administrative Agent, its name, address, tax identification number and/or such other identification information as shall be necessary for the Administrative Agent to comply with federal law.
Article IV.
[
Reserved
]
Article V. Yield Protection, Etc.
Section 5.1.
Additional Costs; Capital Adequacy.
(a)
Capital Adequacy
. If any Lender in the Loan determines that compliance with any law or regulation or with any guideline or request from any central bank or other Governmental Authority (whether or not having the force of law) affects or would affect the amount of capital required or expected to be maintained by such Lender, or any corporation controlling such Lender, as a consequence of, or with reference to, such Lender's or such corporation's Commitments or its making or maintaining Loans below the rate which such Lender or such corporation controlling such Lender could have achieved but for such compliance (taking into account the policies of such Lender or such corporation with regard to capital), then the Borrower shall, from time to time, within thirty (30) calendar days after written demand by such Lender, pay to such Lender additional amounts sufficient to compensate such Lender or such corporation controlling such Lender to the extent that such Lender determines such increase in capital is allocable to such Lender's obligations hereunder.
(b)
Additional Costs.
In addition to, and not in limitation of the immediately preceding clause (a), the Borrower shall following fifteen (15) days written demand therefor pay to the Administrative Agent for the account of a Lender such amounts as such Lender may reasonably determine to be necessary to compensate such Lender for any costs incurred by such Lender that it reasonably determines are attributable to its making or maintaining of any LIBOR Loans (or Base Rate Loans bearing interest based on the LIBOR Market Index Rate) or its obligation to make any LIBOR Loans (or any Base Rate Loans bearing interest based on the LIBOR Market Index Rate) hereunder, any reduction in any amount receivable by such Lender under this Agreement or any of the other Loan Documents in respect of any of such LIBOR Loans (or such Base Rate Loans bearing interest based on the LIBOR Market Index Rate) or such obligation or the maintenance by such Lender of capital in respect of its LIBOR Loans (or Base Rate Loans bearing interest based on the LIBOR Market Index Rate) or its Commitments (such increases in costs and reductions in amounts receivable being herein called “Additional Costs”), resulting from any Regulatory Change that: (i) changes the basis of taxation of any amounts payable to such Lender under this Agreement or any of the other Loan Documents in respect of any of such LIBOR Loans (or any such Base Rate Loans bearing interest based on the LIBOR Market Index Rate) or its Commitments (other than taxes imposed on or measured by the overall net income of such Lender or of its Lending Office for any of such LIBOR Loans (or such Base Rate Loans bearing interest based on the LIBOR Market Index Rate) by the jurisdiction in which such Lender has its principal office or such Lending Office), or (ii) imposes or modifies any reserve, special deposit or similar requirements (including without limitation, Regulation D of the Board of Governors of the Federal Reserve System or other similar reserve requirement applicable to any other category of liabilities or category of extensions of credit or other assets by reference to which the interest rate on LIBOR Loans (or Base Rate Loans bearing interest based on the LIBOR Market Index Rate) is determined) relating to any extensions of credit or other assets of, or any deposits with or other liabilities of, or other credit extended by, or any other acquisition of funds by such Lender (or its parent corporation), or any commitment of such Lender (including, without limitation, the Commitment of such Lender hereunder) or (iii) has or would have the effect of reducing the rate of return on capital of such Lender to a level below that which such Lender could have achieved or increasing any liquidity requirement but for such Regulatory Change (taking into consideration such Lender's policies with respect to capital adequacy and liquidity).
(c)
Lender's Suspension of LIBOR Loans.
Without limiting the effect of the provisions of the immediately preceding subsection (a) and (b), if by reason of any Regulatory Change, any Lender either (i) incurs Additional Costs based on or measured by the excess above a specified level of the amount of a category of deposits or other liabilities of such Lender that includes deposits by reference to which the interest rate on LIBOR Loans is determined as provided in this Agreement or a category of extensions of credit or other assets of such Lender that includes LIBOR Loans or (ii) becomes subject to restrictions on the amount of such a category of liabilities or assets that it may hold, then, if such Lender
so elects by notice to the Borrower (with a copy to the Administrative Agent), the obligation of such Lender to make or Continue, or to Convert Base Rate Loans into, LIBOR Loans shall be suspended until such Regulatory Change ceases to be in effect (in which case the provisions of Section 5.5. shall apply).
(d)
Additional Costs in Respect of Letters of Credit
. Without limiting the obligations of the Borrower under the preceding subsections of this Section (but without duplication), if as a result of any Regulatory Change or any risk-based capital guideline or other requirement heretofore or hereafter issued by any Governmental Authority there shall be imposed, modified or deemed applicable any tax, reserve, special deposit, capital adequacy, liquidity requirement or similar requirement against or with respect to or measured by reference to Letters of Credit and the result shall be to increase the cost to the Issuing Bank of issuing (or any Lender of purchasing participations in) or maintaining its obligation hereunder to issue (or purchase participations in) any Letter of Credit or reduce any amount receivable by the Issuing Bank or any Lender hereunder in respect of any Letter of Credit, then, upon demand by the Issuing Bank or such Lender, the Borrower shall pay immediately to the Issuing Bank or, in the case of such Lender, to the Administrative Agent for the account of such Lender, from time to time as specified by the Issuing Bank or such Lender, such additional amounts as shall be sufficient to compensate the Issuing Bank or such Lender for such increased costs or reductions in amount.
(e)
Notification and Determination of Additional Costs.
Each of the Administrative Agent, the Issuing Bank and each Lender, as the case may be, agrees to notify the Borrower of any event occurring after the Agreement Date entitling the Administrative Agent, the Issuing Bank or such Lender to compensation under any of the preceding subsections of this Section as promptly as practicable;
provided
,
however
, that if the Administrative Agent, the Issuing Bank or Lender shall fail to give such notice within forty-five (45) days after it obtains actual knowledge of such event, then the Administrative Agent, the Issuing Bank or Lender, as the case may be, shall only be entitled to compensation under any of the preceding subsections for compensable amounts attributable to such event arising following the date the Administrative Agent, the Issuing Bank or Lender, as the case may be, obtains actual knowledge of such event. The Administrative Agent, the Issuing Bank and each Lender, as the case may be, agrees to furnish to the Borrower (and in the case of the Issuing Bank or a Lender to the Administrative Agent as well) a certificate setting forth the basis and amount of each request for compensation under this Section. Determinations by the Administrative Agent, the Issuing Bank or such Lender, as the case may be, of the effect of any Regulatory Change shall be conclusive and binding for all purposes, provided that such determinations are made on a reasonable basis and in good faith.
Section 5.2.
Suspension of LIBOR Loans.
Anything herein to the contrary notwithstanding, if, on or prior to the determination of LIBOR for any Interest Period:
(a)
the Administrative Agent reasonably determines (which determination shall be conclusive) that quotations of interest rates for the relevant deposits referred to in the definition of LIBOR are not being provided in the relevant amounts or for the relevant maturities for purposes of determining rates of interest for LIBOR Loans as provided herein or is otherwise unable to determine LIBOR, or
(b)
the Administrative Agent reasonably determines (which determination shall be conclusive) that the relevant rates of interest referred to in the definition of LIBOR upon the basis of which the rate of interest for LIBOR Loans for such Interest Period is to be determined are not likely to adequately cover the cost to any Lender of making or maintaining LIBOR Loans for such Interest Period;
then the Administrative Agent shall give the Borrower and each Lender prompt notice thereof and, so long as such condition remains in effect, the Lenders shall be under no obligation to, and shall not, make additional LIBOR Loans, Continue LIBOR Loans or Convert Loans into LIBOR Loans and the Borrower shall, on the last day of each current Interest Period for each outstanding LIBOR Loan, either prepay such Loan or Convert such Loan into a Base Rate Loan.
Section 5.3.
Illegality.
Notwithstanding any other provision of this Agreement, if any Lender shall determine (which determination shall be conclusive and binding) that it is unlawful for such Lender to honor its obligation to make or maintain LIBOR Loans hereunder, then such Lender shall promptly notify the Borrower thereof (with a copy of such notice to the Administrative Agent) and such Lender's obligation to make or Continue, or to Convert Loans of any other Type into, LIBOR Loans shall be suspended, in each case, until such time as such Lender may again make and maintain LIBOR Loans (in which case the provisions of Section 5.5. shall be applicable).
Section 5.4.
Compensation.
The Borrower shall pay to the Administrative Agent for the account of each Lender, upon the request of the Administrative Agent, such amount or amounts as the Administrative Agent shall determine in its reasonable discretion shall be sufficient to compensate such Lender for any loss, cost or expense attributable to:
(a)
any payment or prepayment (whether mandatory or optional) of a LIBOR Loan, or Conversion of a LIBOR Loan, made by such Lender for any reason (including, without limitation, acceleration) on a date other than the last day of the Interest Period for such Loan; or
(b)
any failure by the Borrower for any reason (including, without limitation, the failure of any of the applicable conditions precedent specified in Article 6.2. to be satisfied) to borrow a LIBOR Loan from such Lender on the date for such borrowing, or to Convert a Base Rate Loan into a LIBOR Loan or Continue a LIBOR Loan on the requested date of such Conversion or Continuation.
Not in limitation of the foregoing, such compensation shall include, without limitation; in the case of a LIBOR Loan, an amount equal to the then present value of (A) the amount of interest that would have accrued on such LIBOR Loan for the remainder of the Interest Period at the rate applicable to such LIBOR Loan, less (B) the amount of interest that would accrue on the same LIBOR Loan for the same period if LIBOR were set on the date on which such LIBOR Loan was repaid, prepaid or Converted or the date on which the Borrower failed to borrow, Convert or Continue such LIBOR Loan, as applicable, calculating present value by using as a discount rate LIBOR quoted on such date. Upon the Borrower's request (made through the Administrative Agent) any Lender seeking compensation under this Section shall provide the Borrower with a statement setting forth the basis for requesting such compensation and the method for determining the amount thereof. Any such statement shall be conclusive absent manifest error.
Section 5.5.
Treatment of Affected Loans.
If the obligation of any Lender to make LIBOR Loans or to Continue, or to Convert Base Rate Loans into, LIBOR Loans shall be suspended pursuant to Section 5.1.(c), Section 5.2., or Section 5.3. then such Lender's LIBOR Loans shall be automatically Converted into Base Rate Loans on the last day(s) of the then current Interest Period(s) for LIBOR Loans (or, in the case of a Conversion required by
Section 5.1.(c), Section 5.2., or Section 5.3. on such earlier date as such Lender may specify to the Borrower with a copy to the Administrative Agent) and, unless and until such Lender gives notice as provided below that the circumstances specified in Section 5.1., Section 5.2., or Section 5.3. that gave rise to such Conversion no longer exist:
(i)
to the extent that such Lender's LIBOR Loans have been so Converted, all payments and prepayments of principal that would otherwise be applied to such Lender's LIBOR Loans shall be applied instead to its Base Rate Loans; and
(ii)
all Loans that would otherwise be made or Continued by such Lender as LIBOR Loans shall be made or Continued instead as Base Rate Loans, and all Base Rate Loans of such Lender that would otherwise be Converted into LIBOR Loans shall remain as Base Rate Loans.
If such Lender gives notice to the Borrower (with a copy to the Administrative Agent) that the circumstances specified in Section 5.1.(c) or 5.3. that gave rise to the Conversion of such Lender's LIBOR Loans pursuant to this Section no longer exist (which such Lender agrees to do promptly upon such circumstances ceasing to exist) at a time when LIBOR Loans made by other Lenders are outstanding, then such Lender's Base Rate Loans shall be automatically Converted, on the first day(s) of the next succeeding Interest Period(s) for such outstanding LIBOR Loans, to the extent necessary so that, after giving effect thereto, all Loans held by the Lenders holding LIBOR Loans and by such Lender are held pro rata (as to principal amounts, Types and Interest Periods) in accordance with their respective Commitments.
Section 5.6.
Affected Lenders.
If (a) a Lender (other than the Lender then acting as the Administrative Agent) requests compensation pursuant to Section 3.10. or 5.1., and the Requisite Lenders are not also doing the same, (b) the obligation of any Lender (other than the Lender then acting as the Administrative Agent) to make LIBOR Loans that are Revolving Loans or to Continue, or to Convert Base Rate Loans into, LIBOR Loans that are Revolving Loans shall be suspended pursuant to Section 5.1.(c) or 5.3. but the obligation of the Requisite Lenders shall not have been suspended under such Sections, or (c) a Lender does not vote in favor of any amendment, modification or waiver to this Agreement or any other Loan Document, which, pursuant to Section 13.7., requires the vote of such Lender, and the Requisite Lenders shall have voted in favor of such amendment, modification or waiver, then, so long as there does not then exist any Default or Event of Default, the Borrower may demand that such Lender (the “Affected Lender”), and upon such demand the Affected Lender shall promptly, assign its Commitments to an Eligible Assignee subject to and in accordance with the provisions of Section 13.6.(c) for a purchase price equal to (x) the aggregate principal balance of all Loans then owing to the Affected Lender, plus (y) the aggregate amount of payments previously made by the Affected Lender under Section 2.2.(j) that have not been repaid, plus (z) any accrued but unpaid interest thereon and accrued but unpaid fees owing to the Affected Lender, or any other amount as may be mutually agreed upon by such Affected Lender and Eligible Assignee. Each of the Administrative Agent and the Affected Lender shall reasonably cooperate in effectuating the replacement of such Affected Lender under this Section, but at no time shall the Administrative Agent, such Affected Lender nor any other Lender be obligated in any way whatsoever to initiate any such replacement or to assist in finding an Eligible Assignee. The exercise by the Borrower of its rights under this Section shall be at the Borrower's sole cost and expenses and at no cost or expense to the Administrative Agent, the Affected Lender or any of the other Lenders; provided, however, the Borrower shall not be obligated to reimburse or otherwise pay an Affected Lender's administrative or legal costs
incurred as a result of the Borrower's exercise of its rights under this Section. The terms of this Section shall not in any way limit the Borrower's obligation to pay to any Affected Lender compensation owing to such Affected Lender pursuant to Sections 3.10., 5.1. or 5.4. with respect to any matters or events existing on or prior to the date an Affected Lender ceases to be a party to this Agreement.
Section 5.7.
Change of Lending Office.
Each Lender agrees that it will use reasonable efforts (consistent with its internal policy and legal and regulatory restrictions) to designate an alternate Lending Office with respect to any of its Loans affected by the matters or circumstances described in Sections 3.10., 5.1. or 5.3. to reduce the liability of the Borrower or avoid the results provided thereunder, so long as such designation is not disadvantageous to such Lender as determined by such Lender in its sole discretion, except that such Lender shall have no obligation to designate a Lending Office located in the United States of America.
Section 5.8.
Assumptions Concerning Funding of LIBOR Loans.
Calculation of all amounts payable to a Lender under this Article V. shall be made as though such Lender had actually funded LIBOR Loans through the purchase of deposits in the relevant market bearing interest at the rate applicable to such LIBOR Loans in an amount equal to the amount of the LIBOR Loans and having a maturity comparable to the relevant Interest Period; provided, however, that each Lender may fund each of its LIBOR Loans in any manner it sees fit and the foregoing assumption shall be used only for calculation of amounts payable under this Article.
Article VI. Conditions Precedent
Section 6.1.
Initial Conditions Precedent.
The closing and effectiveness of this Agreement and the obligation of the Lenders to effect or permit the occurrence of the first Credit Event hereunder, whether as the making of a Loan or the issuance of a Letter of Credit, is subject to the satisfaction or waiver of the following conditions precedent (as confirmed to the Lenders by Administrative Agent):
(a)
The Administrative Agent shall have received each of the following, in form and substance satisfactory to the Administrative Agent:
(i)
counterparts of this Agreement executed by each of the parties hereto;
(ii)
Revolving Notes executed by the Borrower, payable to each Lender and complying with the terms of Section 2.11.(a) and the Swingline Note executed by the Borrower;
(iii)
a Guaranty executed by each of the Guarantors initially to be a party thereto, and the Parent Guaranty executed by the Parent;
(iv)
opinions of in-house and outside counsel of the Parent and the Borrower and the other Loan Parties, addressed to the Administrative Agent and the Lenders in form and substance acceptable to Administrative Agent;
(v)
the certificate or articles of incorporation or formation, articles of organization, certificate of limited partnership, declaration of trust or other comparable organizational instrument (if any) of (i) the Borrower and the Parent certified as of a recent date
by the Secretary of State of the state of formation of such Person and (ii) each other Loan Party filed with the Secretary of State of the state of formation of such Person, and in each case, certified by the Secretary or Assistant Secretary (or other individual performing similar functions) of such Person;
(vi)
a certificate of good standing (or certificate of similar meaning) with respect to the Parent and each Loan Party other than Georgia Square Partnership, Georgia Square Associates, Ltd. and Old Hickory Mall Venture issued as of a recent date by the Secretary of State of the state of formation of each such Person;
(vii)
a certificate of incumbency signed by the Secretary or Assistant Secretary (or other individual performing similar functions) of each Loan Party and the Parent with respect to each of the officers of such Person authorized to execute and deliver the Loan Documents to which such Person is a party, and in the case of the Borrower, authorized to execute and deliver on behalf of the Borrower Notices of Borrowing, Notices of Swingline Borrowing, requests for Letters of Credit, Notices of Conversion and Notices of Continuation;
(viii)
copies certified by the Secretary or Assistant Secretary (or other individual performing similar functions) of each Loan Party and the Parent of (A) the by-laws of such Person, if a corporation, the operating agreement, if a limited liability company, the partnership agreement, if a limited or general partnership, or other comparable document in the case of any other form of legal entity and (B) all corporate, partnership, member or other necessary action taken by such Person to authorize the execution, delivery and performance of the Loan Documents to which it is a party;
(ix)
a Compliance Certificate calculated on a pro forma basis for the Borrower's fiscal quarter ending June 30, 2012;
(x)
a Transfer Authorizer Designation Form effective as of the Agreement Date;
(xi)
the Fee Letter;
(xii)
evidence that the Fees, if any, then due and payable under Section 3.5., together with all other fees, expenses and reimbursement amounts due and payable to the Administrative Agent and any of the Lenders, including without limitation, the fees and expenses of counsel to the Administrative Agent, have been paid;
(xiii)
insurance certificates, or other evidence, providing that the insurance coverage required under Section 8.5. (including, without limitation, both property and liability insurance) is in full force and effect;
(xiv)
evidence that all Liens securing the indebtedness, liabilities or other obligations under the Existing Credit Agreement have been released; provided, that provision shall have been made for certain releases and terminations to be filed and fully effective within thirty (30) days after the Effective Date;
(xv)
the duly executed Officer's Certificate; and
(xvi)
such other documents and instruments as the Administrative Agent, or any Lender through the Administrative Agent, may reasonably request.
(b)
In the good faith judgment of the Administrative Agent:
(i)
there shall not have occurred or become known to the Administrative Agent or any of the Lenders any event, condition, situation or status since the date of the information contained in the financial and business projections, budgets, pro forma data and forecasts concerning the Parent, the Borrower and their Subsidiaries delivered to the Administrative Agent and the Lenders prior to the Agreement Date that has had or could reasonably be expected to result in a Material Adverse Effect;
(ii)
no litigation, action, suit, investigation or other arbitral, administrative or judicial proceeding shall be pending or threatened which could reasonably be expected to (A) result in a Material Adverse Effect or (B) restrain or enjoin, impose materially burdensome conditions on, or otherwise materially and adversely affect, the ability of any Loan Party or the Parent to fulfill its obligations under the Loan Documents to which it is a party;
(iii)
the Parent, the Borrower and the other Loan Parties shall have received all approvals, consents and waivers, and shall have made or given all necessary filings and notices as shall be required to consummate the transactions contemplated hereby without the occurrence of any default under, conflict with or violation of (A) any Applicable Law or (B) any agreement, document or instrument to which any Loan Party is a party or by which any of them or their respective properties is bound, except for such approvals, consents, waivers, filings and notices the receipt, making or giving of which, or the failure to make, give or receive which, would not reasonably be likely to (1) have a Material Adverse Effect, or (2) restrain or enjoin, impose materially burdensome conditions on, or otherwise materially and adversely affect the ability of the Borrower, any other Loan Party or the Parent to fulfill its obligations under the Loan Documents to which it is a party;
(iv)
the Borrower and each other Loan Party shall have provided all information requested by the Administrative Agent and each Lender in order to comply with the USA Patriot Act (Title III of Pub. L. 107-56 (signed into law October 26, 2001)); and
(v)
there shall not have occurred or exist any material disruption of financial or capital markets that could reasonably be expected to materially and adversely affect the transactions contemplated by the Loan Documents.
(c)
the Administrative Agent shall have received evidence satisfactory to it that (i) that certain $167,000,000 credit facility dated as of November 30, 2007, by and among Borrower and the Administrative Agent (and other lenders), known as “Starmount”, shall have been (or shall be concurrently with the effectiveness of this Agreement) repaid in full and terminated and (ii) the “Unsecured Indebtedness” covenant set forth in that certain $228,000,000 credit facility dated as of April 22, 2008, by and among Borrower and the Administrative Agent (and other lenders), known as “Westfield”, shall have been amended to allow the maximum ratio of “Unsecured Indebtedness” to “Gross Asset Value” (each as defined therein) to be increased to 0.15 to 1.00.
Section 6.2.
Conditions Precedent to All Loans and Letters of Credit.
The obligations of (i) Lenders to make any Loans, and (ii) the Issuing Bank to issue Letters of Credit are each subject to the terms of Section 2.15. and to the further conditions precedent that:
(a)
in the case of the making of a Loan, no Default or Event of Default shall exist as of the date of the making of such Loan or would exist immediately after giving effect thereto;
(b)
in the case of the issuance of a Letter of Credit, no Default or Event of Default shall exist as of the date of the issuance of such Letter of Credit or would exist immediately after giving effect thereto;
(c)
none of the conditions described in Section 2.15. would exist after giving effect to the making of such Loan or the issuance of such Letter of Credit;
(d)
the representations and warranties made or deemed made by the Parent, the Borrower and each other Loan Party in the Loan Documents to which any of them is a party, shall be true and correct in all material respects (except in the case of a representation or warranty qualified by materiality, in which case such representation or warranty shall be true and correct in all respects) on and as of the date of the making of such Loan or date of issuance of such Letter of Credit with the same force and effect as if made on and as of such date except to the extent that such representations and warranties expressly relate solely to an earlier date (in which case such representations and warranties shall have been true and accurate in all material respects (except in the case of a representation or warranty qualified by materiality, in which case such representation or warranty shall be true and correct in all respects) on and as of such earlier date) and except for changes in factual circumstances specifically and expressly permitted hereunder; and
(e)
in the case of the borrowing of Revolving Loans, the Administrative Agent shall have received a timely Notice of Borrowing, or in the case of a Swingline Loan, the Swingline Lender shall have received a timely Notice of Swingline Borrowing.
The occurrence of each Credit Event shall constitute a certification by the Borrower to the effect set forth in the preceding subsections (a) through (d) (both as of the date of the giving of notice relating to such Credit Event and, unless the Borrower otherwise notifies the Administrative Agent prior to the date of such Credit Event, as of the date of the occurrence of such Credit Event). In addition, the Borrower shall be deemed to have represented to the Administrative Agent and the Lenders at the time such Loan is made or such Letter of Credit is issued that to the best of the Borrower's knowledge all conditions to the making of such Loan or issuing of such Letter of Credit contained in this Article VI. have been satisfied.
Section 6.3.
Conditions as Covenants.
If the Lenders permit the making of any Loans, or the Issuing Bank issues a Letter of Credit, prior to the satisfaction of all conditions precedent set forth in Sections 6.1. and 6.2., such condition or conditions shall not be deemed waived unless Lenders or the Issuing Bank, as applicable, waive such condition or conditions in writing and, if requested by Lenders or the Issuing Bank, as applicable, Borrower shall nevertheless cause such condition or conditions to be satisfied within a reasonable period of time after the date of the making of such Loans or the issuance of such Letter of Credit. Unless set forth in writing to the contrary, the making of its initial Loan by a Lender shall constitute a confirmation by such Lender to the Administrative Agent and the other Lenders that insofar as such Lender is concerned the Borrower has satisfied the conditions precedent for initial Loans set forth in Sections 6.1. and 6.2.
Article VII. Representations and Warranties
Section 7.1.
Representations and Warranties.
In order to induce the Administrative Agent and each Lender to enter into this Agreement and to make Loans and to acquire participations in Letters of Credit and, in the case of the Issuing Bank, to issue Letters of Credit, the Borrower represents and warrants to the Administrative Agent, the Issuing Bank and each Lender as follows:
(a)
Organization; Power; Qualification
. Each of the Parent and the Loan Parties and the other Subsidiaries is a corporation, partnership or other legal entity, duly organized or formed, validly existing and in good standing under the jurisdiction of its incorporation or formation, has the power and authority to own or lease its respective properties and to carry on its respective business as now being and hereafter proposed to be conducted and is duly qualified and is in good standing as a domestic or foreign corporation, partnership or other legal entity, and authorized to do business, in each jurisdiction in which the character of its properties or the nature of its business requires such qualification or authorization and where the failure to be so qualified or authorized could reasonably be expected to have, in each instance, a Material Adverse Effect.
(b)
Ownership Structure
. Part I of
Schedule 7.1.(b)
is, as of the Agreement Date, a complete and correct list of each Loan Party and each other Limited Subsidiary, directly or indirectly, holding an Equity Interest in any Loan Party, setting forth for each such Person, (i) the jurisdiction of organization of such Person, (ii) each Person holding any Equity Interest in such Person, (iii) the nature of the Equity Interests held by each such Person and (iv) the percentage of ownership of such Person represented by such Equity Interests. As of the Agreement Date, except as disclosed in such Schedule, (A) each of the Parent, the Borrower and its applicable Subsidiaries owns, free and clear of all Liens, and has the unencumbered right to vote, all outstanding Equity Interests in each Person shown to be held by it on such Schedule, (B) all of the issued and outstanding capital stock of each such Person organized as a corporation is validly issued, fully paid and non-assessable and (C) there are no outstanding subscriptions, options, warrants, commitments, preemptive rights or agreements of any kind (including, without limitation, any stockholders' or voting trust agreements) for the issuance, sale, registration or voting of, or outstanding securities convertible into, any additional shares of capital stock of any class, or partnership or other ownership interests of any type in, any such Person. As of the Agreement Date, Part II of
Schedule 7.1.(b)
correctly sets forth (i) all Persons which have assets included in the Unencumbered Asset Value pursuant to clause (2) of the definition thereof and (ii) to the extent each such Person owns an Eligible Property, the Management Company and each Wholly Owned Subsidiary thereof, including the correct legal name of such Person, the type of legal entity which each such Person is, and all Equity Interests in such Person held directly or indirectly by the Borrower. Exhibit 21 to the Parent's Form 10-K for the fiscal year ended December 31, 2011 is an accurate list of the Subsidiaries of the Parent as of such date (excluding those Subsidiaries that need not be disclosed on such Exhibit pursuant to Regulation S-K of the Securities Act).
(c)
Authorization of Agreement, Notes, Loan Documents and Borrowings
. The Borrower has the right and power, and has taken all necessary action to authorize it, to borrow and obtain other extensions of credit hereunder. The Borrower, each other Loan Party and the Parent has the right and power, and has taken all necessary action to authorize it, to execute, deliver and perform each of the Loan Documents and the Fee Letter to which it is a party in accordance with their respective terms and to consummate the transactions contemplated hereby and thereby. The Loan Documents and the Fee Letter to which the Borrower, any other Loan Party or the Parent is a party have been duly executed and
delivered by the duly authorized officers of such Person and each is a legal, valid and binding obligation of such Person enforceable against such Person in accordance with its respective terms, except as the same may be limited by bankruptcy, insolvency, and other similar laws affecting the rights of creditors generally and the availability of equitable remedies for the enforcement of certain obligations contained herein or therein and as may be limited by equitable principles generally.
(d)
Compliance of Agreement, Etc. with Laws
. The execution, delivery and performance of this Agreement, the other Loan Documents to which any Loan Party or the Parent is a party and the Fee Letter in accordance with their respective terms and the borrowings and other extensions of credit hereunder do not and will not, by the passage of time, the giving of notice, or both: (i) require any Governmental Approval or violate any Applicable Law (including all Environmental Laws) relating to any Loan Party or the Parent; (ii) conflict with, result in a breach of or constitute a default under the organizational documents of the Borrower, any other Loan Party or the Parent, or any indenture, agreement or other instrument to which any Loan Party or the Parent is a party or by which it or any of its respective properties may be bound; or (iii) result in or require the creation or imposition of any Lien upon or with respect to any Property now owned or hereafter acquired by any Loan Party or the Parent other than in favor of the Administrative Agent for its benefit and the benefit of the Lenders and the Issuing Bank.
(e)
Compliance with Law; Governmental Approvals
. To the best of the knowledge of the Parent and the Borrower after due inquiry, the Parent, each Loan Party and each other Subsidiary is in compliance with each Governmental Approval and all other Applicable Laws relating to it except for non-compliances which, and Governmental Approvals the failure to possess which, could not, individually or in the aggregate, reasonably be expected to cause a Default or Event of Default or have a Material Adverse Effect.
(f)
Title to Properties; Liens
.
Schedule 7.1.(f)
is, as of the Agreement Date, a complete and correct listing of all Eligible Properties of the Borrower, each other Loan Party and each other Limited Subsidiary, setting forth, for each such Property, the current occupancy status of such Property and whether such Property is a Development Property or Unimproved Land. Each of the Loan Parties and each other Limited Subsidiary has good, marketable and legal title to, or a valid leasehold interest in, its respective assets.
(g)
Existing Indebtedness; Total Indebtedness
. The Parent's form 10-Q for the second quarter of fiscal year 2012 as filed with the Securities and Exchange Commission sets forth true, correct and complete information, on a consolidated basis, as of June 30, 2012, regarding all Indebtedness (including all Guarantees) and Total Indebtedness of the Parent and each of the Loan Parties. As of the Agreement Date, the Parent and the Loan Parties have materially performed and are in material compliance with all of the terms of such Indebtedness and all instruments and agreements relating thereto, and no default or event of default, or event or condition which with the giving of notice, the lapse of time, or both, would constitute a default or event of default, exists with respect to any such Indebtedness.
(h)
Material Contracts
.
Schedule 7.1.(h)
is, as of the Agreement Date, a true, correct and complete listing of all Material Contracts (other than Tenant Leases). Each of the Parent and the Loan Parties that are parties to any Material Contract has performed and is in compliance with all of the terms of such Material Contract, and no default or event of default, or event or condition which with the giving of notice, the lapse of time, or both, would constitute such a default or event of default, exists with respect to any such Material Contract.
(i)
Litigation
. Except as set forth on
Schedule 7.1.(i)
, there are no actions, suits or proceedings pending (nor, to the knowledge of any Loan Party or the Parent, are there any actions, suits or proceedings threatened, nor is there any basis therefor) against or in any other way relating adversely to or affecting the Parent, any Loan Party, any other Subsidiary or any of their respective property in any court or before any arbitrator of any kind or before or by any other Governmental Authority which, (i) if adversely determined, could reasonably be expected to have a Material Adverse Effect or (ii) in any manner draws into question the validity or enforceability of any Loan Documents or the Fee Letter. There are no strikes, slow downs, work stoppages or walkouts or other labor disputes in progress or threatened relating to, any Loan Party or any other Subsidiary that could reasonably be expected to have a Material Adverse Effect.
(j)
Taxes
. All federal, state and other tax returns of, the Borrower and the Parent required by Applicable Law to be filed have been duly filed (other than any return the filing date of which has been extended in accordance with Applicable Law), and all federal, state and other taxes, assessments and other governmental charges or levies upon, the Borrower and the Parent and each of their respective properties, income, profits and assets which are due and payable have been paid, except any such non-payment or non-filing which is at the time permitted under Section 8.6. As of the Agreement Date, none of the United States income tax returns of, either the Borrower or the Parent is under audit. All charges, accruals and reserves on the books of the Borrower and the Parent in respect of any taxes or other governmental charges are in accordance with GAAP.
(k)
Financial Statements
. The Borrower has furnished to each Lender copies of (i) the audited consolidated balance sheet of the Parent and its consolidated Subsidiaries for the fiscal years ended December 31, 2010 and December 31, 2011, and the related consolidated statements of operations, shareholders' equity and cash flow for the fiscal years ended on such dates, with the opinion thereon of Deloitte & Touche, and (ii) the unaudited consolidated balance sheet of the Parent and its consolidated Subsidiaries for the fiscal quarter ended June 30, 2012, and the related consolidated statements of operations, shareholders' equity and cash flow of the Parent and its consolidated Subsidiaries for the two (2) fiscal quarters ended on such date. Such balance sheets and statements (including in each case related schedules and notes) are complete and correct in all material respects and present fairly, in accordance with GAAP consistently applied throughout the periods involved, the consolidated financial position of the Borrower and its consolidated Subsidiaries as of their respective dates and the results of operations and the cash flow for such periods (subject, as to interim statements, to changes resulting from normal year‑end audit adjustments). Neither the Parent, the Borrower nor any consolidated Subsidiary has on the Agreement Date any material contingent liabilities, liabilities, liabilities for taxes, unusual or long-term commitments or unrealized or forward anticipated losses from any unfavorable commitments, except as referred to or reflected or provided for in said financial statements.
(l)
No Material Adverse Change
. Since June 30, 2012, there has been no material adverse change in the consolidated financial condition, results of operations, business or prospects of the Parent and its Subsidiaries, or Borrower and its Subsidiaries, in each case, taken as a whole. Each of the Parent, the Borrower, the other Loan Parties and the other Limited Subsidiaries is Solvent.
(m)
ERISA
. Management Company and each member of the ERISA Group has fulfilled its obligations under the contribution requirements of ERISA and the Internal Revenue Code with respect to each Plan and is in compliance in all material respects with the presently applicable provisions of ERISA and the Internal Revenue Code with respect to each Plan. Neither Management Company nor any member of the ERISA Group has (i) sought a waiver of the minimum funding standard under Section 412 of the Internal Revenue Code in respect of any Plan, (ii) failed to make any contribution or payment to
any Plan or Multiemployer Plan or in respect of any Benefit Arrangement, or made any amendment to any Plan or Benefit Arrangement, which has resulted or could result in the imposition of a Lien or the posting of a bond or other security under ERISA or the Internal Revenue Code or (iii) incurred any liability under Title IV of ERISA other than a liability to the PBGC for premiums under Section 4007 of ERISA.
(n)
Absence of Default
. None of the Parent, the Loan Parties or the other Subsidiaries is in default under its certificate or articles of incorporation or formation, bylaws, partnership agreement or other similar organizational documents, and no event has occurred, which has not been remedied, cured or waived: (i) which constitutes a Default or an Event of Default; or (ii) which constitutes, or which with the passage of time, the giving of notice, or both, would constitute, a default or event of default by, the Parent or any Loan Party under any agreement (other than this Agreement) or judgment, decree or order to which any such Person is a party or by which any such Person or any of its respective properties may be bound where such default or event of default could, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.
(o)
Environmental Laws
. To the best of the knowledge of the Parent and the Borrower after due inquiry, each of Parent, the Loan Parties and the other Subsidiaries: (i) is in compliance with all Environmental Laws applicable to its business, operations and the Properties, (ii) has obtained all Governmental Approvals which are required under Environmental Laws, and each such Governmental Approval is in full force and effect, and (iii) is in compliance with all terms and conditions of such Governmental Approvals, where with respect to each of the immediately preceding clauses (i) through (iii) the failure to obtain or to comply with could be reasonably expected to have a Material Adverse Effect. Except for any of the following matters that could not be reasonably expected to have a Material Adverse Effect to the best of the knowledge of the Parent and the Borrower after due inquiry, neither the Parent nor any Loan Party is aware of, nor has it received notice of, any past present or pending releases, events, conditions, circumstances, activities, practices, incidents, facts, occurrences, actions, or plans that, with respect to Parent, any Loan Party or any other Subsidiary, their respective businesses, operations or with respect to the Properties, may: (i) cause or contribute to an actual or alleged violation of or non-compliance with Environmental Laws, (ii) cause or contribute to any other potential common-law or legal claim or other liability, or (iii) cause any of the Properties to become subject to any restrictions on ownership, occupancy, use or transferability under any Environmental Law or require the filing or recording of any notice, approval or disclosure document under any Environmental Law and, with respect to the immediately preceding clauses (i) through (iii) is based on or related to the on-site or off-site manufacture, generation, processing, distribution, use, treatment, storage, disposal, transport, removal, clean up or handling, or the emission, discharge, release or threatened release of any wastes or Hazardous Material, or any other requirement under Environmental Law. There is no civil, criminal, or administrative action, suit, demand, claim, hearing, notice, or demand letter, mandate, order, lien, request, investigation, or proceeding pending or, to the Parent's or the Borrower's knowledge after due inquiry, threatened, against Parent, any Loan Party or any other Subsidiary relating in any way to Environmental Laws which, reasonably could be expected to have a Material Adverse Effect. None of the Properties is listed on or proposed for listing on the National Priority List promulgated pursuant to the Comprehensive Environmental Response, Compensation and Liability Act of 1980 and its implementing regulations, or any state or local priority list promulgated pursuant to any analogous state or local law. To Parent's and Borrower's knowledge, no Hazardous Materials generated at or transported from the Properties is or has been transported to, or disposed of at, any location that is listed or proposed for listing on the National Priority List or any analogous state or local priority list, or any other location that is or has been the subject of a clean-up, removal or remedial action pursuant to any Environmental Law, except to the extent
that such transportation or disposal could not reasonably be expected to result in a Material Adverse Effect.
(p)
Investment Company
. Neither Parent, any Loan Party, nor any other Subsidiary is (i) an “investment company” or a company “controlled” by an “investment company” within the meaning of the Investment Company Act of 1940, as amended, or (ii) subject to any other Applicable Law which purports to regulate or restrict its ability to borrow money or obtain other extensions of credit or to consummate the transactions contemplated by this Agreement or to perform its obligations under any Loan Document to which it is a party.
(q)
Margin Stock
. Neither the Parent, any Loan Party nor any other Subsidiary is engaged principally, or as one of its important activities, in the business of extending credit for the purpose, whether immediate, incidental or ultimate, of buying or carrying “margin stock” within the meaning of Regulation U of the Board of Governors of the Federal Reserve System.
(r)
Affiliate Transactions
. Except as permitted by Section 10.9. or as otherwise set forth on
Schedule 7.1.(r)
, neither Parent nor any Loan Party is a party to or bound by any agreement or arrangement (whether oral or written) with any Affiliate (other than a Third Party Affiliate).
(s)
Intellectual Property
. Each of the Parent, the Loan Parties and each other Subsidiary owns or has the right to use, under valid license agreements or otherwise, all patents, licenses, franchises, trademarks, trademark rights, service marks, service mark rights, trade names, trade name rights, trade secrets and copyrights (collectively, “Intellectual Property”) necessary to the conduct of its businesses, without known conflict with any patent, license, franchise, trademark, trademark right, service mark, service mark right, trade secret, trade name, copyright, or other proprietary right of any other Person. All such Intellectual Property is fully protected and/or duly and properly registered, filed or issued in the appropriate office and jurisdictions for such registrations, filing or issuances. To Borrower's knowledge, no material claim has been asserted by any Person with respect to the use of any such Intellectual Property, or challenging or questioning the validity or effectiveness of any such Intellectual Property. To Borrower's knowledge, the use of such Intellectual Property by the Borrower, the other Loan Parties and the other Subsidiaries does not infringe on the rights of any Person, subject to such claims and infringements as do not, in the aggregate, give rise to any liabilities on the part of the Borrower, any other Loan Party or any other Subsidiary that could reasonably be expected to have a Material Adverse Effect.
(t)
Business
. As of the Agreement Date, the Parent, the Loan Parties and the other Limited Subsidiaries are primarily engaged in the business of owning and operating regional malls, strip shopping centers, outlet malls, and mixed-use commercial properties.
(u)
Broker's Fees
. No broker's or finder's fee, commission or similar compensation will be payable with respect to the transactions contemplated hereby.
(v)
Accuracy and Completeness of Information
. All written information, reports and other papers and data furnished to the Administrative Agent or any Lender by, on behalf of, or at the direction of, the Parent, any Loan Party or any other Subsidiary were, at the time the same were so furnished, complete and correct in all material respects, to the extent necessary to give the recipient a true and accurate knowledge of the subject matter, or, in the case of financial statements, present fairly, in accordance with GAAP consistently applied throughout the periods involved, the financial position of the Persons involved as at the date thereof and the results of operations for such periods. No fact is known to the Parent or any Loan Party which has had, or may in the future have (so far as any Loan Party can reasonably foresee), a Material Adverse Effect which has not been set forth in the financial statements
referred to in Section 7.1.(k) or in such information, reports or other papers or data or otherwise disclosed in writing to the Administrative Agent and the Lenders prior to the Effective Date. No document furnished or written statement made to the Administrative Agent or any Lender in connection with the negotiation, preparation or execution of, or pursuant to, this Agreement or any of the other Loan Documents contains or will contain any untrue statement of a fact material to the creditworthiness of Parent, any Loan Party or any other Subsidiary or omits or will omit to state a material fact necessary in order to make the statements contained therein not misleading.
(w)
Not Plan Assets; No Prohibited Transactions
. For purposes of ERISA and the Internal Revenue Code, none of the assets of the Parent, any Loan Party or any other Subsidiary constitutes “plan assets”, within the meaning of ERISA, the Internal Revenue Code and the respective regulations promulgated thereunder, of any Plan. The execution, delivery and performance of the Loan Documents and the Fee Letter by the Loan Parties and the Parent, and the borrowing, other credit extensions and repayment of amounts thereunder, do not and will not constitute “prohibited transactions” under ERISA or the Internal Revenue Code.
(x)
OFAC
. None of the Parent, the Borrower, any of the other Loan Parties, any of the other Subsidiaries, or any other Affiliate of the Parent or the Borrower (provided, however, such representation or warranty with respect to any Third Party Affiliate is made to the best knowledge of the Parent and the Borrower): (i) is a person named on the list of Specially Designated Nationals or Blocked Persons maintained by the U.S. Department of the Treasury's Office of Foreign Assets Control (“OFAC”) available at http://www.treas.gov/offices/enforcement/ofac/index.shtml, or as otherwise published from time to time; (ii) is (A) an agency of the government of a country, (B) an organization controlled by a country, or (C) a person resident in a country that is subject to a sanctions program identified on the list maintained by OFAC and available at http://www.treas.gov/offices/enforcement/ofac/index.shtml, or as otherwise published from time to time, as such program may be applicable to such agency, organization or person; or (iii) derives any of its assets or operating income from investments in or transactions with any such country, agency, organization or person; and none of the proceeds from the Loan will be used to finance any operations, investments or activities in, or make any payments to, any such country, agency, organization, or person.
(y)
REIT Status
. The Parent qualifies as, and has elected to be treated as, a REIT and is in compliance with all requirements and conditions imposed under the Internal Revenue Code to allow the Parent to maintain its status as a REIT.
(z)
Unencumbered Properties
. Each Property included in calculations of the Unencumbered Asset Value satisfies all of the requirements (including those in the definition of “Eligible Property”) contained in this Agreement for the same to be included therein.
(aa)
Legal Restrictions on Ability to Borrow
. Neither the Parent nor any Loan Party is subject to any Applicable Law which purports to regulate or restrict its ability to borrow money or obtain other extensions of credit or to consummate the transactions contemplated by this Agreement or to perform its obligations under any Loan Document to which it is a party.
Section 7.2.
Survival of Representations and Warranties, Etc.
All statements contained in any certificate, financial statement or other instrument delivered by or on behalf of any Loan Party or the Parent, to the Administrative Agent or any Lender pursuant to or in connection with this Agreement or any of the other Loan Documents (including, but not limited to, any such statement made in or in connection with any amendment thereto or any statement contained in any
certificate, financial statement or other instrument delivered by or on behalf of any Loan Party or the Parent prior to the Agreement Date and delivered to the Administrative Agent or any Lender in connection with the underwriting or closing the transactions contemplated hereby) shall constitute representations and warranties made by the Borrower under this Agreement. All representations and warranties made under this Agreement and the other Loan Documents shall be deemed to be made at and as of the Agreement Date, the Effective Date and at and as of the date of the occurrence of each Credit Event, except to the extent that such representations and warranties expressly relate solely to an earlier date (in which case such representations and warranties shall have been true and accurate on and as of such earlier date) and except for changes in factual circumstances expressly and specifically permitted hereunder. All such representations and warranties shall survive the effectiveness of this Agreement, the execution and delivery of the Loan Documents and the making of the Loans and the issuance of the Letters of Credit, but shall terminate upon the termination of this Agreement in accordance with, but subject to, the provisions of Section 13.11.
Article VIII. Affirmative Covenants
For so long as this Agreement is in effect, unless the Requisite Lenders (or, if required pursuant to Section 13.7., all of the Lenders) shall otherwise consent in the manner provided for in Section 13.7., the Parent and the Borrower, as applicable, shall comply with the following covenants:
Section 8.1.
Preservation of Existence and Similar Matters.
Except as otherwise permitted under Section 10.4., the Parent and the Borrower shall, and shall cause each other Loan Party and each other Subsidiary to, preserve and maintain its respective existence, rights, franchises, licenses and privileges in the jurisdiction of its incorporation or formation and qualify and remain qualified and authorized to do business in each jurisdiction in which the character of its properties or the nature of its business requires such qualification and authorization and where the failure to be so authorized and qualified could reasonably be expected to have a Material Adverse Effect.
Section 8.2.
Compliance with Applicable Law.
The Parent and the Borrower shall, and shall cause each other Loan Party and each other Subsidiary to, comply with all Applicable Law, including the obtaining of all Governmental Approvals, the failure with which to comply could, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.
Section 8.3.
Maintenance of Property.
In addition to the requirements of any of the other Loan Documents, the Borrower shall, and shall cause each Subsidiary to, (a) protect and preserve all of its respective material properties, including, but not limited to, all Intellectual Property necessary to the conduct of its respective business, and maintain in good repair, working order and condition all tangible properties, ordinary wear and tear and insured casualty losses excepted, and (b) from time to time make or cause to be made all necessary repairs and replacements to such Properties, so that the business carried on in connection therewith may be properly conducted at all times.
Section 8.4.
Conduct of Business.
The Borrower shall, and shall cause the other Loan Parties and each other Limited Subsidiary to, carry on its respective businesses as described in Section 7.1.(t).
Section 8.5.
Insurance.
In addition to the requirements of any of the other Loan Documents, the Borrower shall, and shall cause each other Loan Party and each other Subsidiary to, maintain insurance (on a replacement cost basis) with financially sound and reputable insurance companies against such risks and in such amounts as are customarily maintained by Persons engaged in similar businesses or as may be required by Applicable Law. The Borrower shall from time to time deliver to the Administrative Agent upon request a detailed list, together with copies of certificates evidencing all policies of the insurance then in effect, stating the names of the insurance companies, the amounts and rates of the insurance, the dates of the expiration thereof and the properties and risks covered thereby. Such insurance shall, in any event, include terrorism coverage (to the extent reasonably available).
Section 8.6.
Payment of Taxes and Claims.
The Parent and the Borrower shall, and shall cause each other Loan Party and each other Subsidiary to, pay and discharge when due (a) all taxes, assessments and governmental charges or levies imposed upon it or upon its income or profits or upon any properties belonging to it, and (b) all lawful claims of materialmen, mechanics, carriers, warehousemen and landlords for labor, materials, supplies and rentals which, if unpaid, might become a Lien on any properties of such Person; provided, however, that this Section shall not require the payment or discharge of any such tax, assessment, charge, levy or claim which is (x) being contested in good faith by appropriate proceedings which operate to suspend the collection thereof and for which adequate reserves have been established on the books of such Person, or (y) bonded or otherwise insured against to the reasonable satisfaction of the Administrative Agent.
Section 8.7.
Books and Records; Inspections.
The Parent and the Borrower will, and will cause each other Loan Party and each other Subsidiary to, keep proper books of record and account in which full, true and correct entries shall be made of all dealings and transactions in relation to its business and activities. The Parent and the Borrower will, and the Borrower will cause each other Loan Party and each other Subsidiary to, permit representatives of the Administrative Agent or any Lender to visit and inspect any of their respective properties, to examine and make abstracts from any of their respective books and records and to discuss their respective affairs, finances and accounts with their respective officers, employees and independent public accountants (in the Borrower's presence if an Event of Default does not then exist), all at such reasonable times during business hours and as often as may reasonably be requested and so long as no Event of Default exists, with reasonable prior notice; provided, however, unless an Event of Default exists (a) only the Administrative Agent may exercise its rights under this Section which shall be limited to two (2) inspections during any period of twelve (12) consecutive months, and (b) the Administrative Agent may not discuss the affairs, finances and accounts of the Parent or the Borrower with their employees pursuant to this Section. The Borrower shall be obligated to reimburse the Administrative Agent and the Lenders for their actual costs and expenses incurred in connection with the exercise of their rights under this Section only if such exercise occurs while a Default or Event of Default exists.
Section 8.8.
Use of Proceeds.
The Borrower will only use the proceeds of Loans (a) for the payment of pre-development and development costs incurred in connection with Properties owned by the Borrower or any Subsidiary; (b) to finance acquisitions otherwise permitted under this Agreement; (c) to finance capital expenditures and the repayment of Indebtedness of the Borrower and its Subsidiaries; (d) to make equity investments otherwise permitted under this Agreement and (e) to provide for the general working capital needs of the
Borrower and its Subsidiaries and for other general corporate purposes of the Borrower and its Subsidiaries. The Borrower shall only use Letters of Credit for the same purposes for which it may use the proceeds of Loans. The Borrower shall not, and shall not permit any other Loan Party or any other Subsidiary or the Parent to, use any part of such proceeds to purchase or carry, or to reduce or retire or refinance any credit incurred to purchase or carry, any margin stock (within the meaning of Regulation U of the Board of Governors of the Federal Reserve System) or to extend credit to others for the purpose of purchasing or carrying any such margin stock if, in any such case, such use might result in any of the Loans or other Obligations being considered to be “purpose credit” directly or indirectly secured by margin stock within the meaning of Regulation U or Regulation X of the Board of Governors of the Federal Reserve System.
Section 8.9.
Environmental Matters.
The Borrower shall, and shall cause Parent, each Loan Party and each other Subsidiary to, comply with all Environmental Laws the failure with which to comply could reasonably be expected to have a Material Adverse Effect. The Borrower shall comply, and shall cause the Parent and each other Loan Party and each other Subsidiary to comply, and the Borrower shall use, and shall cause the Parent and each other Loan Party and each other Subsidiary to use, commercially reasonable efforts to cause all other Persons occupying, using or present on the Properties to comply, with all Environmental Laws in all material respects. The Borrower shall, and shall cause the Parent and each other Loan Party and each other Subsidiary to, promptly take all actions and pay or arrange to pay all costs necessary for it and for the Properties to comply in all material respects with all Environmental Laws and all Governmental Approvals, including actions to remove and dispose of all Hazardous Materials and to clean up the Properties as required under Environmental Laws, except that such requirement shall not prevent Borrower from first contesting matters in which it reasonably believes there has been no violation of any Environmental Law or Governmental Approval The Borrower shall, and shall cause the Parent and the Loan Parties and the other Subsidiaries to, promptly take all actions necessary to prevent the imposition of any Liens on any of their respective properties arising out of or related to any Environmental Laws. Nothing in this Section shall impose any obligation or liability whatsoever on the Administrative Agent or any Lender.
Section 8.10.
Further Assurances.
At the Borrower's cost and expense (provided such cost is reasonable and shall not have a Material Adverse Effect) and upon request of the Administrative Agent, the Borrower shall, and shall cause each other Loan Party and each other Subsidiary to, duly execute and deliver or cause to be duly executed and delivered, to the Administrative Agent such further instruments, documents and certificates, and do and cause to be done such further acts that may be reasonably necessary or advisable in the reasonable opinion of the Administrative Agent to carry out more effectively the provisions and purposes of this Agreement and the other Loan Documents.
Section 8.11.
Material Contracts.
The Borrower shall, and shall cause the Parent and each other Loan Party to, duly and punctually perform and comply with any and all material representations, warranties, covenants and agreements expressed as binding upon any such Person under any Material Contract. The Borrower shall not, and shall not permit the Parent and any other Loan Party to, do or knowingly permit to be done anything to impair materially the value of any of the Material Contracts.
Section 8.12.
REIT Status.
The Parent shall at all times maintain its status as, and election to be treated as, a REIT.
Section 8.13.
Exchange Listing.
The Parent shall maintain outstanding at least one class of common shares of the Parent having trading privileges on the New York Stock Exchange or the American Stock Exchange or which is subject to price quotations on The NASDAQ Stock Market's National Market System.
Section 8.14.
Guarantors.
(a)
Within five (5) Business Days (or such longer period as the Administrative Agent may reasonably determine) of (i) any Person becoming a Material Subsidiary (other than an Excluded Subsidiary) after the Agreement Date, (ii) any Subsidiary of the Borrower (other than an Excluded Subsidiary) becoming the owner, directly or indirectly, of the equity interests of any other Guarantor, (iii) solely with respect to any Subsidiary (other than an Excluded Subsidiary) that was a Material Subsidiary as of the Agreement Date and in good faith and without the actual knowledge of the Borrower did not become a Guarantor as of the Agreement Date, such Subsidiary's identification as being a Material Subsidiary, (iv) solely with respect to any Material Subsidiary that was not an Excluded Subsidiary but in good faith and with reasonable belief was identified by the Borrower to be an Excluded Subsidiary as of the Agreement Date and did not become a Guarantor as of the Agreement Date, May 13, 2013, (v) any Subsidiary that owns an Eligible Property or other asset, the value of which is included in the determination of Unencumbered Asset Value, incurring, acquiring or suffering to exist any Recourse Indebtedness of such Subsidiary, and (vi) any Subsidiary executing and delivering a Guaranty of, or otherwise becoming obligated in respect of, any Indebtedness of the Parent, the Borrower or any Subsidiary of the Borrower, the Borrower shall deliver to the Administrative Agent each of the following in form and substance satisfactory to the Administrative Agent: (a) an Accession Agreement executed by such Subsidiary and (b) the items that would have been delivered under subsections (iv) through (viii) and (xvi) of Section 6.1.(a) if such Person had been a Material Subsidiary on the Agreement Date; provided, that promptly (and in any event within five (5) Business Days) upon any Material Subsidiary which is an Excluded Subsidiary ceasing to be subject to the restriction which prevented it from becoming a Guarantor on the Effective Date or delivering an Accession Agreement pursuant to this Section, as the case may be, such Material Subsidiary shall comply with the provisions of this Section.
(b)
The Borrower may request in writing that the Administrative Agent release, and upon receipt of such request the Administrative Agent shall release, a Guarantor (but not the Parent) from its Guaranty so long as: (i) no Property owned by such Guarantor shall thereafter be included in the list of Eligible Properties, (ii) such Guarantor shall no longer be a Material Subsidiary and is not otherwise required to be a party to the Guaranty under the immediately preceding subsection (a) and (iii) no Default or Event of Default shall then be in existence or would occur as a result of such release. In the event the Borrower obtains an Investment Grade Rating during the term of this Agreement, the Borrower may request in writing that the Administrative Agent release, so long as there is no Default or Event of Default in existence or that would occur as a result of such release, and upon receipt of such request the Administrative Agent shall release, each of the Guarantors (but not (x) the Parent, (y) any Subsidiary required to become a Guarantor pursuant to Section 8.14.(a)(v) or (vi), or (z) any Subsidiary that holds title to any Eligible Property or any other asset the value of which is included in the determination of Unencumbered Asset Value solely to the extent any Equity Interests of such Subsidiary are owned, directly or indirectly, by any Subsidiary of the Borrower that is an Excluded Subsidiary pursuant to clause (a)(x)(ii) of the definition of such term (such Subsidiary under this clause (z) being a “Continuing Guarantor Subsidiary”)) from the Guaranty, the Guaranty (but not the Parent Guaranty and other than
with respect to any Subsidiary required to become a Guarantor pursuant to Section 8.14(a)(v) or (vi) and any Continuing Guarantor Subsidiary) shall be terminated in accordance with the terms hereof and thereof, and, except to the extent required pursuant to Section 8.14.(a)(v) or (vi) and with respect to any Continuing Guarantor Subsidiary, no future Subsidiary of the Borrower shall be required to provide a Guaranty.
(c)
Within five (5) Business Days of the Parent executing and delivering a Guaranty of any Indebtedness of the Borrower or any Subsidiary (except for (i) guaranties of customary exceptions for fraud, misapplication of funds, environmental indemnities, voluntary bankruptcy, collusive involuntary bankruptcy and other similar exceptions to non-recourse liability, (ii) the Indebtedness set forth on
Schedule 8.14.(c)
, and (iii) guaranties of tenant improvement allowances with respect to any Property owned by any of its Subsidiaries
to the extent such guaranties are entered into in the ordinary course of the Borrower's business and consistent with past practice),
the Borrower shall cause the Parent to amend the Parent Guaranty to unconditionally guaranty the Obligations hereunder in their entirety.
Article IX. Information
For so long as this Agreement is in effect, unless the Requisite Lenders (or, if required pursuant to Section 13.7., all of the Lenders) shall otherwise consent in the manner set forth in Section 13.7., the Borrower shall furnish to the Administrative Agent at the Principal Office for distribution to each of the Lenders:
Section 9.1.
Quarterly Financial Statements.
Within five (5) Business Days of the filing thereof, a copy of each report on Form 10-Q (or its equivalent) which the Parent shall file with the Securities and Exchange Commission (or any Governmental Authority substituted therefor). If the Parent ceases to file such reports, or if any such report filed does not contain any of the following, then the Borrower shall deliver as soon as available and in any event within forty-five (45) days after the close of each of the first, second and third fiscal quarters of the Parent, the unaudited consolidated balance sheet of the Parent and its Subsidiaries as at the end of such period and the related unaudited consolidated statements of operations, stockholders' equity and cash flows of the Parent and its Subsidiaries for such period, setting forth in each case in comparative form the figures as of the end of and for the corresponding periods of the previous fiscal year, all of which shall be certified by the chief financial officer of the Parent, in his or her opinion, to present fairly, in accordance with GAAP and in all material respects, the consolidated financial position of the Parent and its Subsidiaries as at the date thereof and the results of operations for such period (subject to normal year-end audit adjustments).
Section 9.2.
Year-End Statements.
Within five (5) Business Days of the filing thereof, a copy of each report on Form 10‑K (or its equivalent) which the Parent shall file with the Securities and Exchange Commission (or any Governmental Authority substituted therefor). If the Parent ceases to file such reports, or if any such report filed does not contain any of the following, then the Borrower shall deliver as soon as available and in any event within ninety (90) days after the end of each fiscal year of the Parent, the audited consolidated balance sheet of the Parent and its Subsidiaries as at the end of such fiscal year and the related audited consolidated statements of operations, stockholders' equity and cash flows of the Parent and its Subsidiaries for such fiscal year, setting forth in comparative form the figures as at the end of and
for the previous fiscal year, all of which shall be certified by (a) the chief financial officer of the Parent, in his or her opinion, to present fairly, in accordance with GAAP, the financial position of the Parent and its Subsidiaries as at the date thereof and the result of operations for such period and (b) Deloitte & Touche or any other independent certified public accountants of recognized national standing reasonably acceptable to the Requisite Lenders, whose certificate shall be unqualified and in scope and substance required by generally accepted auditing standards and who shall have authorized the Parent to deliver such financial statements and certification thereof to the Administrative Agent and the Lenders pursuant to this Agreement.
Section 9.3.
Compliance Certificate.
At the time the financial statements are furnished pursuant to the immediately preceding Sections 9.1. and 9.2., (a) a certificate substantially in the form of
Exhibit K
(a “Compliance Certificate”) executed on behalf of the Borrower by any officer of the Parent having a position of at least a senior vice-president or the Parent's vice president of accounting (i) setting forth as of the end of such quarterly accounting period or fiscal year, as the case may be, the calculations required to establish whether the Parent was in compliance with the covenants contained in Section 10.1.; and (ii) stating that to the best of such officer's knowledge, no Default or Event of Default exists, or, if such is not the case, specifying such Default or Event of Default and its nature, when it occurred and the steps being taken by the Parent with respect to such event, condition or failure, (b) a statement of cash flow for such quarterly accounting period or fiscal year, (c) a report of newly acquired Properties for such quarterly accounting period or fiscal year, including the Net Operating Income, cost and Mortgage Indebtedness, if any, of each such Property, and (d) a schedule of the Properties comprising Unencumbered Asset Value detailing trailing twelve (12) month Net Operating Income, GAAP undepreciated cost basis, Occupancy Rate and a calculation of Unencumbered Asset Value for such quarterly accounting period or fiscal year.
Section 9.4.
Other Information.
(a)
Within ten (10) Business Days of the filing thereof, and if the same are not available on-line free of charge from either the website of the Securities and Exchange Commission or the website of the Parent, copies of all press releases, shareholder reports, registration statements (excluding the exhibits thereto and any registration statements on Form S-8 or its equivalent), reports on Forms 10-K, 10-Q and 8-K (or their equivalents) and all other periodic reports which the Parent, any Loan Party or any other Subsidiary shall file with the Securities and Exchange Commission (or any Governmental Authority substituted therefor) or any national securities exchange;
(b)
No later than sixty (60) days after the end of each fiscal year of the Parent ending prior to the Maturity Date, projected balance sheets, operating statements, profit and loss projections and cash flow budgets (including sources and uses of cash) of the Parent and its Subsidiaries on a consolidated basis for each quarter
of the next succeeding fiscal year, all itemized in reasonable detail. The foregoing shall be accompanied by pro forma calculations, together with detailed assumptions, required to establish whether or not the Parent, and when appropriate its consolidated Subsidiaries, will be in compliance with the covenants contained in Sections 10.1. and at the end of each fiscal quarter of the remainder of the fiscal year;
(c)
If and when any member of the ERISA Group or the Management Company (i) gives or is required to give notice to the PBGC of any “reportable event” (as defined in Section 4043 of ERISA) with respect to any Plan which might constitute grounds for a termination of such Plan under Title IV of ERISA, or knows that the plan administrator of any Plan has given or is required to give notice of any
such reportable event, a copy of the notice of such reportable event given or required to be given to the PBGC; (ii) receives notice of complete or partial withdrawal liability under Title IV of ERISA or notice that any Multiemployer Plan is in reorganization, is insolvent or has been terminated, a copy of such notice; (iii) receives notice from the PBGC under Title IV of ERISA of an intent to terminate, impose liability (other than for premiums under Section 4007 of ERISA) in respect of, or appoint a trustee to administer any Plan, a copy of such notice; (iv) applies for a waiver of the minimum funding standard under Section 412 of the Internal Revenue Code, a copy of such application; (v) gives notice of intent to terminate any Plan under Section 4041(c) of ERISA, a copy of such notice and other information filed with the PBGC; (vi) gives notice of withdrawal from any Plan pursuant to Section 4063 of ERISA, a copy of such notice; or (vii) fails to make any payment or contribution to any Plan or Multiemployer Plan or in respect of any Benefit Arrangement or makes any amendment to any Plan or Benefit Arrangement which has resulted or could result in the imposition of a Lien or the posting of a bond or other security, a certificate of the controller of the Borrower setting forth details as to such occurrence and action, if any, which the Borrower, Management Company, or applicable member of the ERISA Group is required or proposes to take;
(d)
To the extent any Senior Officer is aware of the same, prompt notice of any notification received from, any inquiry by or the commencement of any proceeding or investigation by or before any Governmental Authority and any action or proceeding in any court or other tribunal or before any arbitrator against or in any other way relating adversely to, or adversely affecting, the Parent, any Loan Party or any other Subsidiary or any of their respective properties, assets or businesses (including but not limited to any notification of a material violation of any law or regulation) which, if determined or resolved adversely to such Person, could reasonably be expected to have a Material Adverse Effect, and prompt notice of the receipt of notice that any United States income tax returns of any Loan Party or any other Subsidiary are being audited;
(e)
A copy of any amendment to the certificate or articles of incorporation or formation, bylaws, partnership agreement or other similar organizational documents of the Parent, the Borrower, or any other Loan Party within five (5) Business Days after the effectiveness thereof;
(f)
Prompt notice of any change in the Chairman, Chief Executive Officer, President or Chief Financial Officer of the Parent, the Borrower, the Management Company or any other Loan Party and any change in the business, assets, liabilities, financial condition, results of operations or business prospects of the Parent or any Loan Party which has had or could reasonably be expected to have Material Adverse Effect;
(g)
Prompt notice of (i) the occurrence of any Default or Event of Default or (ii) any event which constitutes or which with the passage of time, the giving of notice, or otherwise, would constitute a default or event of default by Parent, any Loan Party or any other Subsidiary under any Material Contract to which any such Person is a party or by which any such Person or any of its respective properties may be bound;
(h)
Prompt notice of any order, judgment or decree which is not covered by insurance and which is in excess of $1,000,000 having been entered against the Parent or any Loan Party or any of their respective properties or assets;
(i)
Prompt notice of any guaranty executed by a Subsidiary guaranteeing indebtedness of the Parent or Borrower and which, as a result thereof, is required to execute an Accession Agreement pursuant to Section 8.14.;
(j)
Prompt notice of the acquisition, incorporation or other creation of any Subsidiary, the purpose for such Subsidiary, the nature of the assets and liabilities thereof, whether such Subsidiary is a Wholly Owned Subsidiary of the Borrower, and whether such Subsidiary is a Material Subsidiary;
(k)
Promptly upon the request of the Administrative Agent, evidence of the Borrower's calculation of the Ownership Share with respect to a Subsidiary or an Unconsolidated Affiliate, such evidence to be in form and detail satisfactory to the Administrative Agent;
(l)
Promptly, upon any change in the Parent's or Borrower's Credit Rating, a certificate stating that the Parent's or the Borrower's Credit Rating has changed and the new Credit Rating that is in effect;
(m)
Promptly, upon each request, information identifying the Parent or Borrower as a Lender may request in order to comply with the USA Patriot Act (Title III of Pub. L. 107-56 (signed into law October 26, 2001));
(n)
Within ten (10) days after the Borrower obtains knowledge thereof, the Borrower shall provide the Administrative Agent with written notice of the occurrence of any of the following: (i) the Borrower, the Parent, any Loan Party or any other Subsidiary shall receive notice that any violation of or non-compliance with any Environmental Law has or may have been committed; (ii) the Borrower, the Parent, any Loan Party or any other Subsidiary shall receive notice that any administrative or judicial complaint, order or petition has been filed or other proceeding has been initiated, or is about to be filed or initiated against any such Person alleging any violation of or non-compliance with any Environmental Law or requiring any such Person to take any action in connection with the release or threatened release of Hazardous Materials; or (iii) the Parent, the Borrower, any Loan Party or any other Subsidiary shall receive any notice from a Governmental Authority or private party alleging that any such Person may be liable or responsible for any costs associated with a response to, or remediation or cleanup of, a release or threatened release of Hazardous Materials or any damages caused thereby, and
such notice(s), whether individually or in the aggregate, could reasonably be expected to have a Material Adverse Effect;
(o)
From time to time and promptly upon each request, such data, certificates, reports, statements, documents or further information regarding any Property or the business, assets, liabilities, financial condition, results of operations or business prospects of the Parent, the Borrower, any of their respective Subsidiaries, any other Loan Party or the Management Company as the Administrative Agent or any Lender may reasonably request; and
(p)
No more than thirty (30) days following the consummation of any transaction of acquisition, merger or purchase of assets, involving consideration, or valued, in excess of $300,000,000, whether in a single transaction or related series of transactions, written notice of such transaction or transactions, together with a reasonably detailed description thereof, provided however, that this Section 9.4.(p) shall not eliminate any requirement in Section 10.4. or elsewhere herein that Borrower provide notice to the Administrative Agent and/or receive approval or consent from the Administrative Agent and/or the Lenders prior to such transactions.
(q)
No more than ten (10) Business Days following the consummation of any disposition of an asset or pool of assets, involving consideration, or valued, in excess of $500,000,000, whether in a single transaction or related series of transactions, written notice of such transaction or transactions, together with a reasonably detailed description thereof, provided however, that this Section 9.4.(q) shall not eliminate any requirement in Section 10.4. or elsewhere herein that Borrower provide notice to the
Administrative Agent and/or receive approval or consent from the Administrative Agent and/or the Lenders prior to such transactions.
Section 9.5.
Electronic Delivery of Certain Information.
(a)
Documents required to be delivered pursuant to the Loan Documents shall be delivered by electronic communication and delivery, including, the Internet, e-mail or intranet websites to which the Administrative Agent and each Lender have access (including a commercial, third-party website such as www.sec.gov <http://www.sec.gov> or a website sponsored or hosted by the Administrative Agent or the Borrower) provided that the foregoing shall not apply to (i) notices to any Lender (or the Issuing Bank) pursuant to Article II., (ii) any Lender that has notified the Administrative Agent or Borrower that it cannot or does not want to receive electronic communications and (iii) notices of Default or Event of Default. The Administrative Agent or the Borrower may, in its discretion, agree to accept notices and other communications to it hereunder by electronic delivery pursuant to procedures approved by it for all or particular notices or communications. Documents or notices delivered electronically shall be deemed to have been delivered twenty-four (24) hours after the date and time on which the Administrative Agent or Borrower posts such documents or the documents become available on a commercial website and the Administrative Agent or Borrower notifies each Lender of said posting and provides a link thereto provided if such notice or other communication is not sent or posted during the normal business hours of the recipient, said posting date and time shall be deemed to have commenced as of 11:00 a.m. Central time on the opening of business on the next Business Day for the recipient. Notwithstanding anything contained herein, in every instance the Borrower shall be required to provide paper copies of the Compliance Certificate required by Section 9.3. to the Administrative Agent and shall deliver paper copies of any documents to the Administrative Agent or to any Lender that requests such paper copies until a written request to cease delivering paper copies is given by the Administrative Agent or such Lender. Except for the Compliance Certificates required by Section 9.3., the Administrative Agent shall have no obligation to request the delivery of or to maintain paper copies of the documents delivered electronically, and in any event shall have no responsibility to monitor compliance by the Borrower with any such request for delivery. Each Lender shall be solely responsible for requesting delivery to it of paper copies and maintaining its paper or electronic documents.
(b)
Documents required to be delivered pursuant to Article II. may be delivered electronically to a website provided for such purpose by the Administrative Agent pursuant to the procedures provided to the Borrower by the Administrative Agent.
Section 9.6.
Public/Private Information.
The Borrower and the Parent shall cooperate with the Administrative Agent in connection with the publication of certain materials and/or information provided by or on behalf of the Borrower or the Parent. Documents required to be delivered pursuant to the Loan Documents shall be delivered by or on behalf of the Borrower or the Parent to the Administrative Agent and the Lenders (collectively, “Information Materials”) pursuant to this Article and shall designate Information Materials (a) that are either available to the public or not material with respect to the Borrower and its Subsidiaries or any of their respective securities for purposes of United States federal and state securities laws, as “Public Information” and (b) that are not Public Information as “Private Information”.
Section 9.7.
USA Patriot Act Notice; Compliance.
The USA Patriot Act of 2001 (Public Law 107-56) and federal regulations issued with respect thereto require all financial institutions to obtain, verify and record certain information that identifies
individuals or business entities which open an “account” with such financial institution. Consequently, a Lender (for itself and/or as Administrative Agent for all Lenders hereunder) may from time-to-time request, and the Borrower shall, and shall cause the Parent and the other Loan Parties, to provide to such Lender, Borrower's, Parent's, each Guarantor's and each other Loan Party's name, address, tax identification number and/or such other identification information as shall be necessary for such Lender to comply with federal law. An “account” for this purpose may include, without limitation, a deposit account, cash management service, a transaction or asset account, a credit account, a loan or other extension of credit, and/or other financial services product. Each Lender will treat all information furnished to it in accordance with this Section 9.7. in the manner required by Section 13.9. of this Agreement.
Article X. Negative Covenants
For so long as this Agreement is in effect, unless the Requisite Lenders (or, if required pursuant to Section 13.7., all of the Lenders) shall otherwise consent in the manner set forth in Section 13.7., the Borrower or the Parent, as the case may be, shall comply with the following covenants:
Section 10.1.
Financial Covenants.
(a)
Minimum Tangible Net Worth
. The Parent shall not permit Tangible Net Worth of the Parent and its Subsidiaries at any time to be less than (i) $1,279,179,000,
plus
(ii) seventy percent (70%) of the Net Proceeds of all Equity Issuances effected at any time after June 30, 2012 by the Parent or any of its Subsidiaries to any Person other than the Parent or any of the Parent's Wholly Owned Subsidiaries.
(b)
Ratio of Total Indebtedness to Total Asset Value
. The Parent shall not permit the ratio of (i) Total Indebtedness of the Parent and its Subsidiaries determined on a consolidated basis to (ii) Total Asset Value of the Parent and its Subsidiaries determined on a consolidated basis to exceed 0.60 to 1.00 at any time.
(c)
Ratio of Unencumbered Asset Value to Unsecured Indebtedness
. The Parent shall not permit the ratio of (i) Unencumbered Asset Value determined on a consolidated basis to (ii) Unsecured Indebtedness of the Parent and its Subsidiaries determined on a consolidated basis to be less than 1.60 to 1.00 at any time.
(d)
Ratio of EBITDA to Fixed Charges
. The Parent shall not permit the ratio of (i) EBITDA of the Parent and its Subsidiaries determined on a consolidated basis for the four (4) fiscal quarters most recently ending to (ii) Fixed Charges of the Parent and its Subsidiaries determined on a consolidated basis for such period, to be less than 1.50 to 1.00 as of the last day of such period.
(e)
Permitted Investments
. The Parent shall not, and shall not permit the Borrower, any other Loan Party or other Subsidiary to, make an Investment in or otherwise own the following items which would cause the aggregate value of such holdings (for purposes of this Section 10.1. the value of the holdings described in items (i) through (vi) shall be calculated in accordance with GAAP, and the value of the holdings described in item (ii) shall be the lower of cost or market) of such Persons to exceed the following percentages of Total Asset Value at any time:
(i)
Unimproved Land, such that the aggregate book value of all such Unimproved Land exceeds five percent (5%) of Total Asset Value;
(ii)
Common stock, Preferred Stock, other capital stock, beneficial interest in trust, membership interest in limited liability companies and other equity interests in Persons (other than consolidated Subsidiaries and Unconsolidated Affiliates), such that the aggregate value of such interests calculated on the basis of the lower of cost or market, exceeds five percent (5%) of Total Asset Value;
(iii)
Mortgage Receivables, such that the aggregate book value of Indebtedness secured by such Mortgage Receivables exceeds five percent (5%) of Total Asset Value;
(iv)
Investments in Unconsolidated Affiliates of the Borrower or the Parent, such that the aggregate book value of such Investments in Unconsolidated Affiliates exceeds ten percent (10%) of Total Asset Value;
(v)
the aggregate amount of the Total Budgeted Costs for Development Properties in which the Borrower either has a direct or indirect ownership interest shall not exceed fifteen percent (15%) of Total Asset Value. If a Development Property is owned by an Unconsolidated Affiliate of the Borrower or any Subsidiary, then the greater of (1) the product of (A) the Borrower's or such Subsidiary's Ownership Share in such Unconsolidated Affiliate and (B) the amount of the Total Budgeted Costs for such Development Property or (2) the recourse obligations of the Borrower or any Subsidiary relating to the Indebtedness of such Unconsolidated Affiliate, shall be used in calculating such investment limitation;
(vi)
Investments in Properties that are not Retail Properties (other than the real estate located at CBL Center, 2030 Hamilton Place Boulevard, Chattanooga, Tennessee), such that the aggregate value of all such Investments exceeds five percent (5%) of Total Asset Value; and
(vii)
Purchase Money Advances, such that the aggregate book value of all such Purchase Money Advances exceeds five percent (5%) of Total Asset Value.
In addition to the foregoing limitations, the aggregate value of (i), (ii), (iii), (iv), (v), (vi) and (vii) shall not exceed thirty percent (30%) of Total Asset Value.
(f)
Dividends and Other Restricted Payments
. The Parent and the Borrower shall not, and shall not permit any of their Subsidiaries to, declare or make any Restricted Payment; provided, however, that the Parent, the Borrower and their Subsidiaries may declare and make the following Restricted Payments so long as no Default or Event of Default would result therefrom: the Borrower may pay cash dividends to the Parent and other holders of partnership interests in the Borrower with respect to any fiscal year ending during the term of this Agreement to the extent necessary for the Parent to distribute, and the Parent may so distribute, cash dividends to its shareholders in an aggregate amount not to exceed the greater of (i) the amount required to be distributed for the Parent to remain in compliance with Section 8.12. or (ii) ninety-five percent (95%) of Funds From Operations. Notwithstanding the foregoing, but subject to the following sentence, if a Default or Event of Default exists, the Parent may only cause the Borrower (directly or indirectly through any intermediate Subsidiaries) to make cash distributions to the Parent and other holders of partnership interests in the Borrower with respect to any fiscal year ending during the term of this Agreement to the extent necessary for the Parent to distribute, and the Parent may so distribute, cash dividends to its shareholders in an aggregate amount required to be distributed for the Parent to remain in compliance with Section 8.12. Notwithstanding the foregoing, if a Default or Event of Default specified in Section 11.1.(a) resulting from the Borrower's failure to pay when due the
principal of, or interest on, any of the Loans or any Fees, Section 11.1.(e) or (f) shall have occurred and be continuing, or if as a result of the occurrence of any other Event of Default the Obligations have been accelerated pursuant to Section 11.2.(a), the Parent and the Borrower shall not, and shall not permit any other Subsidiary to, make any Restricted Payments whatsoever. Subsidiaries other than the Borrower may make Restricted Payments to the Borrower and the other Subsidiaries at any time.
(g)
Ratio of Unencumbered NOI to Unsecured Interest Expense
. The Parent shall not permit the ratio of (i) Unencumbered NOI for any fiscal quarter to (ii) Unsecured Interest Expense of the Parent and its Subsidiaries determined on a consolidated basis for such fiscal quarter, to be less than 1.75 to 1.00 as of the last day of such fiscal quarter.
(h)
Ratio of Secured Recourse Indebtedness to Total Asset Value
.
The Parent shall not permit the ratio of (i) the sum of all Recourse Indebtedness which is Secured Indebtedness of the Parent and its Subsidiaries determined on a consolidated basis to (ii) Total Asset Value of the Parent and its Subsidiaries determined on a consolidated basis to exceed 0.20 to 1.00 at any time.
(i)
Ratio of Secured Indebtedness to Total Asset Value
.
The Parent shall not permit the ratio of (i) Secured Indebtedness of the Parent and its Subsidiaries determined on a consolidated basis to (ii) Total Asset Value of the Parent and its Subsidiaries determined on a consolidated basis to exceed, at any time, (x) from the Effective Date until December 31, 2013, 0.60 to 1.00 or (y) from January 1, 2014 through the Maturity Date, 0.55 to 1.00.
(j)
Ratio of Adjusted Total Asset Value
. Prior to the occurrence of a Credit Rating Election Event, the Parent shall not permit the ratio of (i) the Adjusted Total Asset Value attributable solely to the Borrower and the Guarantors (other than the Parent) to (ii) the Adjusted Total Asset Value determined on a consolidated basis to be less than 0.90 to 1.00 at any time.
(k)
Ratio of Total Asset Value
. The Parent shall not permit (i) the ratio of (x) the Total Asset Value attributable to the Borrower and its Subsidiaries to (y) the Total Asset Value of the Parent and its Subsidiaries determined on a consolidated basis to be less than 0.98 to 1.00 at any time and (ii) the ratio of (x) the amount of rents and other revenues received in the ordinary course from all Property owned by the Borrower and its Subsidiaries to (y) the amount of rents and other revenues received in the ordinary course from all Property owned by the Parent and its Subsidiaries determined on a consolidated basis (in each case, including proceeds of rent loss or business interruption insurance but excluding pre-paid rents and revenues and security deposits except to the extent applied in satisfaction of tenants' obligations for rent) to be less than 0.98 to 1.00 at any time.
Section 10.2.
Negative Pledge.
(a)
The Borrower shall not, and shall not permit any other Loan Party or Subsidiary (other than an Excluded Subsidiary of the type described in clause (a) of the definition of “Excluded Subsidiary”) to, (i) create, assume, incur, permit or suffer to exist any Lien on any of its properties, assets, income or profits of any character whether now owned or hereafter acquired, except for Permitted Liens or (ii) permit any of its properties, assets, income or profits or any direct or indirect ownership interest of the Borrower or in any Person owning any properties, assets, income or profits, to be subject to a Negative Pledge (other than the Negative Pledge under this Agreement).
(b)
The Borrower shall not, and shall not permit any Excluded Subsidiary to, (i) create, assume, incur, permit or suffer to exist any Lien on any Equity Interests of any Subsidiary of the Borrower holding title to any Eligible Property or any other asset the value of which is included in the
determination of Unencumbered Asset Value or the Equity Interests of any Subsidiary of the Borrower that owns, directly or indirectly any Equity Interests in any Subsidiary of the Borrower holding title to any Eligible Property or any other asset the value of which is included in the determination of Unencumbered Asset Value (all such Equity Interests under this clause (i) being “Specified Equity Interests”), except for Permitted Liens described in clause (f) of the definition of that term or (ii) permit any Specified Equity Interests to be subject to a Negative Pledge (other than the Negative Pledge under this Agreement).
Section 10.3.
Restrictions on Intercompany Transfers.
The Borrower shall not, and shall not permit any other Loan Party or any other Subsidiaries (other than an Excluded Subsidiary of the type described in clause (a) of the definition of “Excluded Subsidiary”) to, create or otherwise cause or suffer to exist or become effective any consensual encumbrance or restriction of any kind on the ability of any Subsidiary to: (a) pay dividends or make any other distribution on any of such Subsidiary's capital stock or other equity interests owned by the Borrower or any other Subsidiary; (b) pay any Indebtedness owed to the Borrower or any other Subsidiary; (c) make loans or advances to the Borrower or any other Subsidiary; or (d) transfer any of its property or assets to the Borrower or any other Subsidiary; other than (i) with respect to clauses (a) - (d) those encumbrances or restrictions contained in any Loan Document or, (ii) with respect to clause (d), customary provisions restricting assignment of any agreement entered into by the Borrower, any other Loan Party or any Subsidiary in the ordinary course of business.
Section 10.4.
Merger, Consolidation, Sales of Assets and Other Arrangements.
Without the prior written consent of the Requisite Lenders, such consent not to be unreasonably withheld, the Parent and the Borrower shall not, and shall not permit any other Loan Party or any other Subsidiary to, (a) enter into any transaction of merger or consolidation; (b) liquidate, windup or dissolve itself (or suffer any liquidation or dissolution); (c) convey, sell, lease, sublease, transfer or otherwise dispose of, in one transaction or a series of transactions, all or any substantial part of its business or assets, or the capital stock of or other Equity Interests in any of its Subsidiaries, whether now owned or hereafter acquired; or (d) acquire the assets of, or make an Investment in, any other Person involving consideration, or value, in excess of fifteen percent (15%) of Total Asset Value for the quarter most recently ended as reported on the Compliance Certificate for such quarter; provided, however, that:
(i)
any Subsidiary may merge with a Loan Party so long as such Loan Party is the survivor;
(ii)
any Subsidiary may sell, transfer or dispose of its assets to a Loan Party;
(iii)
a Loan Party (other than the Borrower) and any Subsidiary that is not (and is not required to be) a Loan Party may convey, sell, transfer or otherwise dispose of, in one transaction or a series of transactions, all or any substantial part of its business or assets, or the capital stock of or other Equity Interests in any of its Subsidiaries, and immediately thereafter liquidate, provided that immediately prior to any such conveyance, sale, transfer, disposition or liquidation and immediately thereafter and after giving effect thereto, no Default or Event of Default is or would be in existence;
(iv)
any Loan Party and any other Subsidiary may, directly or indirectly, (A) acquire (whether by purchase, acquisition of Equity Interests of a Person, or as a result of a merger or consolidation) the assets of, or make an Investment in, any other Person in excess of
fifteen percent (15%) of Total Asset Value for the quarter most recently ended as reported on the Compliance Certificate for such quarter, and (B) sell, lease or otherwise transfer, whether by one or a series of transactions, assets (including capital stock or other securities of Subsidiaries) in excess of fifteen percent (15%) of Total Asset Value for the quarter most recently ended as reported on the Compliance Certificate for such quarter to any other Person, so long as, in each case, (1) the Borrower shall have given the Administrative Agent and the Lenders at least thirty (30) days prior written notice of such consolidation, merger, acquisition, Investment, sale, lease or other transfer, together with all information related to such consolidation, merger, acquisition, Investment, sale, lease or transfer as Administrative Agent may reasonably request; (2) immediately prior thereto, and immediately thereafter and after giving effect thereto, no Default or Event of Default is or would be in existence, including, without limitation, a Default or Event of Default resulting from a breach of Section 10.1.; (3) in the case of a consolidation or merger involving the Borrower or a Loan Party which owns an Eligible Property, such Person shall be the survivor thereof; (4) at the time the Borrower gives notice pursuant to clause (1) of this subsection, the Borrower shall have delivered to the Administrative Agent for distribution to each of the Lenders a Compliance Certificate, calculated on a pro forma basis, evidencing the continued compliance by the Loan Parties with the terms and conditions of this Agreement and the other Loan Documents, including without limitation, the financial covenants contained in Section 10.1., after giving effect to such consolidation, merger, acquisition, Investment, sale, lease or other transfer; and (5)(A) with respect to any such acquisition or Investment involving consideration, or valued, in excess of fifteen percent (15%), but less than twenty-five percent (25%), of Total Asset Value for the quarter most recently ended as reported on the Compliance Certificate for such quarter, Administrative Agent has consented thereto or (B) with respect to any such acquisition or Investment involving consideration, or valued, in excess of twenty-five percent (25%) of Total Asset Value for the quarter most recently ended as reported on the Compliance Certificate for such quarter, Requisite Lenders have consented thereto; and
(v)
the Loan Parties may lease and sublease their respective assets, as lessor or sublessor (as the case may be), in the ordinary course of their business.
Further, no Loan Party shall enter into any sale‑leaseback transactions or other transaction by which such Person shall remain liable as lessee (or the economic equivalent thereof) of any real or personal property that it has sold or leased to another Person.
Section 10.5.
Plans.
The Borrower shall not, and shall not permit the Parent or any Subsidiary to, permit any of its respective assets to become or be deemed to be “plan assets” within the meaning of ERISA or the Internal Revenue Code and the respective regulations promulgated thereunder for purposes of ERISA and the Internal Revenue Code.
Section 10.6.
Fiscal Year.
The Parent and the Borrower shall not, and shall not permit any other Loan Party or other Subsidiary to, change its fiscal year from that in effect as of the Agreement Date.
Section 10.7.
Modifications of Organizational Documents and Material Contracts.
The Parent and the Borrower shall not, and shall not permit any other Loan Party or any other Subsidiary to, amend, supplement, restate or otherwise modify its certificate or articles of incorporation or
formation, by-laws, operating agreement, declaration of trust, partnership agreement or other applicable organizational document if such amendment, supplement, restatement or other modification (a) is adverse to the interest of the Administrative Agent, the Issuing Bank or the Lenders or (b) could reasonably be expected to have a Material Adverse Effect. The Borrower shall not enter into, and shall not permit any other Loan Party or any Subsidiary to enter into, any amendment or modification to any Material Contract which could reasonably be expected to have a Material Adverse Effect or default in the performance of any obligations of any other Loan Party or any Subsidiary in any Material Contract or permit any Material Contract to be canceled or terminated prior to its stated maturity.
Section 10.8.
Subordinated Debt Prepayments; Amendments.
The Borrower shall not, and shall not permit any other Loan Party to, prepay any principal of, or accrued interest on, any Subordinated Debt or otherwise make any voluntary or optional payment with respect to any principal of, or accrued interest on, any Subordinated Debt prior to the originally scheduled maturity date thereof or otherwise redeem or acquire for value any Subordinated Debt. Further, the Borrower shall not, and shall not permit any other Loan Party to, amend or modify, or permit the amendment or modification of, any agreement or instrument evidencing any Subordinated Debt where such amendment or modification provides for the following or which has any of the following effects:
(a)
increases the rate of interest accruing on such Subordinated Debt;
(b)
increases the amount of any scheduled installment of principal or interest, or shortens the date on which any such installment or principal or interest becomes due;
(c)
shortens the final maturity date of such Subordinated Debt;
(d)
increases the principal amount of such Subordinated Debt;
(e)
amends any financial or other covenant contained in any document or instrument evidencing any Subordinated Debt in a manner which is more onerous to the Borrower or which requires the Borrower to improve its financial performance;
(f)
provides for the payment of additional fees or the increase in existing fees; and/or
(g)
otherwise could reasonably be expected to be adverse to the interests of the Administrative Agent or the Lenders.
Section 10.9.
Transactions with Affiliates.
The Borrower shall not permit to exist or enter into, and will not permit any Loan Party or other Subsidiary 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 of any Loan Party or any Subsidiary, except (a) as set forth on
Schedule 7.1.(r)
, or (b) transactions in the ordinary course of and pursuant to the reasonable requirements of the business of the Borrower, any of its Subsidiaries, or any Loan Party and upon fair and reasonable terms which are no less favorable to the Borrower, such Subsidiary, or any Loan Party than would be obtained in a comparable arm's length transaction with a Person that is not an Affiliate (which shall include but not be limited to Property Management Agreements). Notwithstanding the forgoing, no payments may be made with respect to any items set forth on such
Schedule 7.1.(r)
if a Default or Event of Default exists or would result therefrom.
Section 10.10.
Environmental Matters.
The Borrower shall not, and shall not permit Parent, any other Loan Party or other Subsidiary or any other Person to, use, generate, discharge, emit, manufacture, handle, process, store, release, transport, remove, dispose of or clean up any Hazardous Materials on, under or from the Properties in material violation of any Environmental Law or in a manner that could reasonably be expected to lead to any material environmental claim or pose a material risk to human health, safety or the environment. Nothing in this Section shall impose any obligation or liability whatsoever on the Administrative Agent or any Lender.
Section 10.11.
Derivatives Contracts.
The Borrower shall not, and shall not permit Parent or any other Loan Party to enter into or become obligated in respect of, Derivatives Contracts, other than (a) Specified Derivatives Contracts or (b) Derivatives Contracts entered into by the Parent, the Borrower or a Loan Party in the ordinary course of business and which establish an effective hedge in respect of liabilities, commitments or assets held or reasonably anticipated by the Parent, the Borrower or a Loan Party (including, without limitation, liabilities under this Agreement).
Article XI. Default
Section 11.1.
Events of Default.
Each of the following shall constitute an Event of Default, whatever the reason for such event and whether it shall be voluntary or involuntary or be effected by operation of Applicable Law or pursuant to any judgment or order of any Governmental Authority:
(a)
Default in Payment
. The Borrower shall fail to pay when due under this Agreement or any other Loan Document (whether upon demand, at maturity, by reason of acceleration or otherwise) the principal of, or any accrued interest on, any of the Loans or any Reimbursement Obligation, or shall fail to pay any of the other payment Obligations owing by the Borrower under this Agreement, any other Loan Document or the Fee Letter, or any other Loan Party shall fail to pay when due any payment obligation owing by such Loan Party under any Loan Document to which it is a party, and, solely in the case of interest or any other payment Obligation (other than principal of any Loan), such failure continues for a period of ten (10) days after the date the Administrative Agent gives the Borrower notice of such failure.
(b)
Default in Performance
.
(i)
Any Loan Party or the Parent shall fail to perform or observe any term, covenant, condition or agreement on its part to be performed or observed and contained in Section 8.1., Section 8.8., Section 8.12., Section 9.4.(g)(i), or Article X; or
(ii)
Any Loan Party or the Parent shall fail to perform or observe any term, covenant, condition or agreement on its part to be performed or observed and contained Section 8.14 or Article IX (other than Section 9.4.(g)(i)) and such failure shall continue for a period of five (5) Business Days; or
(iii)
Any Loan Party or the Parent shall fail to perform or observe any other term, covenant, condition or agreement contained in this Agreement or any other Loan Document
to which it is a party and not otherwise mentioned in this Section and such failure shall continue for a period of thirty (30)
calendar days after the earlier of (x) the date upon which any Senior Officer of the Borrower has actual knowledge of such failure or (y) the date upon which the Borrower has received written notice of such failure from the Administrative Agent.
(c)
Misrepresentations
. Any written statement, representation or warranty made or deemed made by or on behalf of any Loan Party or the Parent under this Agreement or under any other Loan Document, or any amendment hereto or thereto, or in any other writing or statement at any time furnished by, or at the direction of, any Loan Party or the Parent to the Administrative Agent, the Issuing Bank or any Lender under or in connection with this Agreement or any other Loan Documents, shall at any time prove to have been incorrect or misleading in any material respect when furnished or made or deemed made.
(d)
Cross-Default
.
(i)
Any of the Borrower, Parent, any other Loan Party or any Subsidiary shall fail to make any payment when due and payable (subject to any notice and after giving effect to any applicable grace or cure period) in respect of any Recourse Indebtedness or Non-Recourse Indebtedness (other than the Loans and Reimbursement Obligations) having an outstanding principal amount (or, in the case of any Derivatives Contract, having, without regard to the effect of any close-out netting provision, a Derivatives Termination Value) (x) in the case of Recourse Indebtedness, equal to or greater than $50,000,000 for any such Recourse Indebtedness and (y) in the case of Non-Recourse Indebtedness, equal to or greater than $150,000,000 for any such Person's Ownership Share of such Non-Recourse Indebtedness (in the case of each of clause (x) and (y), “Material Indebtedness”); or
(ii)
The maturity of any Material Indebtedness shall have been accelerated in accordance with the provisions of any indenture, contract or instrument evidencing, providing for the creation of or otherwise concerning such Material Indebtedness; or
(iii)
Any Material Indebtedness shall have been required to be prepaid or repurchased prior to the stated maturity thereof; or
(iv)
Any other event shall have occurred and be continuing which, with or without the passage of time, the giving of notice, or otherwise, would permit any holder of Material Indebtedness, any trustee or agent acting on behalf of such holder or holders or any other Person, to accelerate the maturity of any such Material Indebtedness or require any such Material Indebtedness to be prepaid or repurchased prior to its stated maturity; or
(v)
There occurs an “Event of Default” under and as defined in any Specified Derivatives Contract as to which the Parent, the Borrower, any Loan Party or any Subsidiary is a “Defaulting Party” (as defined therein), or there occurs an “Early Termination Date” (as defined therein) in respect of any Specified Derivatives Contract as a result of a “Termination Event” (as defined therein) as to which the Parent, the Borrower or any Subsidiary is an “Affected Party” (as defined therein).
(e)
Voluntary Bankruptcy Proceeding
. The Borrower, the Parent, any Loan Party or any other Significant Subsidiary shall: (i) commence a voluntary case under the Bankruptcy Code or other federal bankruptcy laws (as now or hereafter in effect); (ii) file a petition seeking to take advantage of any other Applicable Laws, domestic or foreign, relating to bankruptcy, insolvency, reorganization,
winding-up, or composition or adjustment of debts; (iii) consent to, or fail to contest in a timely and appropriate manner, any petition filed against it in an involuntary case under such bankruptcy laws or other Applicable Laws or consent to any proceeding or action described in the immediately following subsection (f); (iv) apply for or consent to, or fail to contest in a timely and appropriate manner, the appointment of, or the taking of possession by, a receiver, custodian, trustee, or liquidator of itself or of a substantial part of its property, domestic or foreign; (v) admit in writing its inability to pay its debts as they become due; (vi) make a general assignment for the benefit of creditors; (vii) make a conveyance fraudulent as to creditors under any Applicable Law; or (viii) take any corporate, partnership or similar action for the purpose of effecting any of the foregoing.
(f)
Involuntary Bankruptcy Proceeding
. A case or other proceeding shall be commenced against the Borrower, the Parent, any Loan Party or any other Significant Subsidiary in any court of competent jurisdiction seeking: (i) relief under the Bankruptcy Code or other federal bankruptcy laws (as now or hereafter in effect) or under any other Applicable Laws, domestic or foreign, relating to bankruptcy, insolvency, reorganization, winding‑up, or composition or adjustment of debts; or (ii) the appointment of a trustee, receiver, custodian, liquidator or the like of such Person, or of all or any substantial part of the assets, domestic or foreign, of such Person, and in the case of either clause (i) or (ii) such case or proceeding shall continue undismissed or unstayed for a period of ninety (90) consecutive calendar days, or an order granting the relief requested in such case or proceeding (including, but not limited to, an order for relief under such Bankruptcy Code or such other federal bankruptcy laws) shall be entered.
(g)
Revocation of Loan Documents
. Any Loan Party or the Parent shall (or shall attempt to) disavow, revoke or terminate any Loan Document to which it is a party or the Fee Letter or shall otherwise challenge or contest in any action, suit or proceeding in any court or before any Governmental Authority the validity or enforceability of any Loan Document or the Fee Letter or any Loan Document or the Fee Letter shall cease to be in full force and effect (except as a result of the express terms thereof).
(h)
Judgment
. A judgment or order for the payment of money or for an injunction or other non-monetary relief shall be entered against the Borrower, any other Loan Party, the Parent, or any Subsidiary by any court or other tribunal and (i) such judgment or order shall continue for a period of thirty (30) days without being paid, stayed, dismissed through appropriate appellate proceedings or otherwise bonded and (ii) either (A) the amount of such judgment or order for which insurance has not been acknowledged in writing by the applicable insurance carrier (or the amount as to which the insurer has denied liability) exceeds, individually or together with all other such judgments or orders entered against the Parent, the Loan Parties and Subsidiaries, $50,000,000, or (B) in the case of an injunction or other non-monetary relief, such judgment or order could reasonably be expected to have a Material Adverse Effect.
(i)
Attachment
. A warrant, writ of attachment, execution or similar process shall be issued against any property of the Borrower, the Parent, any Loan Party or any Subsidiary, which exceeds, individually or together with all other such warrants, writs, executions and processes, $50,000,000 and such warrant, writ, execution or process shall not be paid, discharged, vacated, stayed or bonded for a period of sixty (60) days; provided, however, that if a bond has been issued in favor of the claimant or other Person obtaining such warrant, writ, execution or process, the issuer of such bond shall execute a waiver or subordination agreement in form and substance satisfactory to the Administrative Agent pursuant to which the issuer of such bond subordinates its right of reimbursement, contribution or subrogation to the Obligations and waives or subordinates any Lien it may have on the assets of the Borrower, any Loan Party, any Subsidiary or the Parent.
(j)
ERISA
. Any member of the ERISA Group or Management Company shall fail to pay when due an amount or amounts which it shall have become liable to pay under Title IV of ERISA; or notice of intent to terminate a Material Plan shall be filed under Title IV of ERISA by any member of the ERISA Group or Management Company any plan administrator or any combination of the foregoing; or the PBGC shall institute proceedings under Title IV of ERISA to terminate, to impose liability (other than for premiums under Section 4007 of ERISA) in respect of, or to cause a trustee to be appointed to administer any Material Plan; or a condition shall exist by reason of which the PBGC would be entitled to obtain a decree adjudicating that any Material Plan must be terminated; or there shall occur a complete or partial withdrawal from, or a default, within the meaning of Section 4219(c)(5) of ERISA, with respect to, one or more Multiemployer Plans which could cause one or more members of the ERISA Group or Management Company to incur withdrawal liability or a current payment obligation; and such failure, action, event or occurrence could reasonably be expected to have a Material Adverse Effect.
(k)
Loan Documents
. An Event of Default (as defined therein) shall occur under any of the other Loan Documents.
(l)
Change of Control/Change in Management
.
(i)
Any “person” or “group” (as such terms are used in Sections 13(d) and 14(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)), is or becomes the “beneficial owner” (as defined in Rules 13d-3 and 13d-5 under the Exchange Act, except that a Person will be deemed to have “beneficial ownership” of all securities that such Person has the right to acquire, whether such right is exercisable immediately or only after the passage of time), directly or indirectly, of more than thirty-five percent (35%) of the total voting power of the then outstanding voting stock of the Parent entitled to vote for the election of directors (“Parent Voting Stock”);
provided
,
however
, this clause shall not apply to any Parent Voting Stock acquired after the date hereof by a Person as a result of the conversion of limited partnership interests in the Borrower into Parent Voting Stock in accordance with Borrower's partnership agreement;
provided further
, however, this clause shall not apply to any Parent Voting Stock acquired after the date hereof by Borrower, the Principals, or any combination thereof, as a result of purchases of Parent Voting Stock by Borrower or the Principals or as a result of the conversion of limited partnership interests in the Borrower into Parent Voting Stock in accordance with Borrower's partnership agreement;
(ii)
during any twelve‑month period (whether before or after the Agreement Date), individuals who at the beginning of such period were directors of the Parent (together with any new directors whose election by such board of directors or election by the shareholders of the Parent was approved by a vote of a majority of the directors then still in office who were either directors at the beginning of such period or whose election or nomination for election was previously so approved but excluding any director whose initial nomination for, or assumption of office as, a director occurs as a result of an actual or threatened solicitation of proxies or consents for the election or removal of one or more directors by any Person or group other than a solicitation for the election of one or more directors by or on behalf of the board of directors) shall cease for any reason (other than death or mental or physical disability) to constitute a majority of the board of directors of the Parent;
(iii)
the general partner of the Borrower shall cease to be a Wholly Owned Subsidiary of the Parent or the Parent shall cease to have the sole and exclusive power to exercise all management and control over the Borrower; or
(iv)
the Parent shall cease to beneficially own, directly or indirectly, at least sixty-five percent (65%) of the outstanding Equity Interests of the Borrower.
(m)
Damage; Strike; Casualty
. Any strike, lockout, labor dispute, embargo, condemnation, act of God or public enemy, or other casualty which causes, for more than thirty (30) consecutive days beyond the coverage period of any applicable business interruption insurance, the cessation or substantial curtailment of revenue producing activities of the Borrower or any other Loan Party taken as a whole and only if any such event or circumstance could reasonably be expected to have a Material Adverse Effect. Notwithstanding the foregoing, no Event of Default shall exist if within thirty (30) days of the occurrence of any such event or circumstance described in the preceding sentence, Borrower delivers to the Administrative Agent for prompt distribution to each Lender a written plan acceptable to all of the Lenders to eliminate such event or circumstance. If such event or circumstance is not eliminated within ninety (90) days of the occurrence of such event or circumstance, an Event of Default shall be deemed to have occurred hereunder.
(n)
Subordinated Debt Documents
. The failure of the Parent or any Loan Party to comply with the terms of any intercreditor agreement or any subordination provisions of any note or other document running to the benefit of the Administrative Agent or Lenders, or if any such document becomes null and void or unenforceable against any lender holding the Subordinated Debt.
Section 11.2.
Remedies Upon Event of Default.
Upon the occurrence of an Event of Default the following provisions shall apply:
(a)
Acceleration; Termination of Facilities
.
(i)
Automatic
. Upon the occurrence of an Event of Default specified in Sections 11.1.(e) or 11.1.(f), (1)(A) the principal of, and all accrued interest on, the Loans and the Notes at the time outstanding, (B) an amount equal to the Stated Amount of all Letters of Credit outstanding as of the date of the occurrence of such Event of Default for deposit into the Letter of Credit Collateral Account and (C) all of the other Obligations, including, but not limited to, the other amounts owed to the Lenders and the Administrative Agent under this Agreement, the Notes or any of the other Loan Documents shall become immediately and automatically due and payable without presentment, demand, protest, or other notice of any kind, all of which are expressly waived by the Borrower on behalf of itself and the other Loan Parties, and (2) the Commitments and the Swingline Commitment and the obligation of the Issuing Bank to issue Letters of Credit hereunder shall all immediately and automatically terminate.
(ii)
Optional
. If any other Event of Default shall exist, the Administrative Agent may, and at the direction of the Requisite Lenders shall: (1) declare (A) the principal of, and accrued interest on, the Loans and the Notes at the time outstanding, (B) an amount equal to the Stated Amount of all Letters of Credit outstanding as of the date of the occurrence of such Event of Default for deposit into the Letter of Credit Collateral Account, and (C) all of the other Obligations, including, but not limited to, the other amounts owed to the Lenders and the Administrative Agent under this Agreement, the Notes or any of the other Loan Documents to be forthwith due and payable, whereupon the same shall immediately become due and payable without presentment, demand, protest or other notice of any kind, all of which are expressly waived by the Borrower on behalf of itself and the other Loan Parties, and (2) terminate the Commitments and the Swingline Commitment and the obligation of the Issuing Bank to issue Letters of Credit hereunder.
(b)
Loan Documents
. The Requisite Lenders may direct the Administrative Agent to, and the Administrative Agent if so directed shall, exercise any and all of its rights under any and all of the other Loan Documents.
(c)
Applicable Law
. The Requisite Lenders may direct the Administrative Agent to, and the Administrative Agent if so directed shall, exercise all other rights and remedies it may have under any Applicable Law.
(d)
Appointment of Receiver
. To the extent permitted by Applicable Law, the Administrative Agent and the Lenders shall be entitled to the appointment of a receiver for the assets and properties of the Parent, the Borrower and the Subsidiaries of the Parent, without notice of any kind whatsoever and without regard to the adequacy of any security for the Obligations or the solvency of any party bound for its payment, to take possession of all or any portion of the property and/or the business operations of the Borrower, the Parent and their Subsidiaries related thereto and to exercise such power as the court shall confer upon such receiver.
(e)
Specified Derivatives Contract Remedies
. Notwithstanding any other provision of this Agreement or other Loan Document, each Specified Derivatives Provider shall have the right, with the prompt notice to the Administrative Agent, but without the approval or consent of or other action by the Administrative Agent or the Lenders, and without limitation of other remedies available to such Specified Derivatives Provider under contract or Applicable Law, to undertake any of the following: (a) to declare an event of default, termination event or other similar event under any Specified Derivatives Contract and to create an “Early Termination Date” (as defined therein) in respect thereof, (b) to determine net termination amounts in respect of any and all Specified Derivatives Contracts in accordance with the terms thereof, and to set off amounts among such contracts, (c) to set off or proceed against deposit account balances, securities account balances and other property and amounts held by such Specified Derivatives Provider pursuant to any Derivatives Support Document, including any “Posted Collateral” (as defined in any credit support annex including in any such Derivatives Support Document to which such Specified Derivatives Provider may be a party), and (d) to prosecute any legal action against the Borrower, the Parent, any Loan Party or other Subsidiary to enforce or collect net amounts owing to such Specified Derivatives Provider pursuant to any Specified Derivatives Contract.
Section 11.3.
Remedies Upon Default.
Upon the occurrence of a Default specified in Section 11.1.(f), the Commitments shall immediately and automatically terminate.
Section 11.4.
Marshaling; Payments Set Aside.
None of the Administrative Agent, the Issuing Bank, any Lender or any Specified Derivatives Provider shall be under any obligation to marshal any assets in favor of any Loan Party or any other party or against or in payment of any or all of the Obligations or the Specified Derivatives Obligations. To the extent that any Loan Party makes a payment or payments to the Administrative Agent and/or the Issuing Bank and/or any Lender and/or any Specified Derivatives Provider, or the Administrative Agent and/or the Issuing Bank and/or any Lender and/or any Specified Derivatives Provider enforce their security interests or exercise their rights of setoff, and such payment or payments or the proceeds of such enforcement or setoff or any part thereof are subsequently invalidated, declared to be fraudulent or preferential, set aside and/or required to be repaid to a trustee, receiver or any other party under any bankruptcy law, state or federal law, common law or equitable cause, then to the extent of such recovery, the Obligations or Specified Derivatives Obligations, or part thereof originally intended to be satisfied,
and all Liens, rights and remedies therefor, shall be revived and continued in full force and effect as if such payment had not been made or such enforcement or setoff had not occurred.
Section 11.5.
Allocation of Proceeds.
If an Event of Default exists and maturity of any of the Obligations has been accelerated or the Maturity Date has occurred, all payments received by the Administrative Agent under any of the Loan Documents, in respect of any principal of or interest on the Obligations or any other amounts payable by the Borrower, the Parent or any other Loan Party hereunder or thereunder, shall be applied in the following order and priority:
(a)
amounts due to the Administrative Agent, the Issuing Bank and the Lenders in respect of expenses due under Section 13.2. until paid in full, and then Fees;
(b)
payments of interest on all Loans, including Swingline Loans;
(c)
payments of principal of all Loans, including Swingline Loans, to be applied for the ratable benefit of the Lenders in such order as the Lenders may determine in their sole discretion;
(d)
amounts to be deposited into the Letter of Credit Collateral Account in respect of Letters of Credit;
(e)
amounts due to the Administrative Agent and the Lenders pursuant to Sections 12.8. and 13.10.;
(f)
payments of all other amounts due under any of the Loan Documents, if any, to be applied for the ratable benefit of the Lenders; and
(g)
any amount remaining after application as provided above, shall be paid to the Borrower or whoever else may be legally entitled thereto.
Section 11.6.
Letter of Credit Collateral Account.
(a)
As collateral security for the prompt payment in full when due of all Letter of Credit Liabilities and the other Obligations, the Borrower hereby pledges and grants to the Administrative Agent, for the ratable benefit of the Administrative Agent, the Issuing Bank and the Lenders as provided herein, a security interest in all of its right, title and interest in and to the Letter of Credit Collateral Account established pursuant to the requirements of Section 2.14. and the balances from time to time in the Letter of Credit Collateral Account (including the investments and reinvestments therein provided for below). The balances from time to time in the Letter of Credit Collateral Account shall not constitute payment of any Letter of Credit Liabilities until applied by the Administrative Agent as provided herein. Anything in this Agreement to the contrary notwithstanding, funds held in the Letter of Credit Collateral Account shall be subject to withdrawal only as provided in this Section and in Section 2.14.
(b)
Amounts on deposit in the Letter of Credit Collateral Account shall be invested and prudently reinvested by the Administrative Agent in such Cash Equivalents as the Administrative Agent shall determine in its sole discretion. All such investments and reinvestments shall be held in the name of and be under the sole dominion and control of the Administrative Agent for the ratable benefit of the Administrative Agent, the Issuing Bank and the Lenders, provided, that all earnings on such investments will be credited to and retained in the Letter of Credit Collateral Account. The Administrative Agent
shall exercise reasonable care in the custody and preservation of any funds held in the Letter of Credit Collateral Account and shall be deemed to have exercised such care if such funds are accorded treatment substantially equivalent to that which the Administrative Agent accords other funds deposited with the Administrative Agent, it being understood that the Administrative Agent shall not have any responsibility for taking any necessary steps to preserve rights against any parties with respect to any funds held in the Letter of Credit Collateral Account.
(c)
If a drawing pursuant to any Letter of Credit occurs on or prior to the expiration date of such Letter of Credit, the Borrower and the Lenders authorize the Administrative Agent to use the monies deposited in the Letter of Credit Collateral Account to reimburse the Issuing Bank for the payment made by the Issuing Bank to the beneficiary with respect to such drawing or the payee with respect to such presentment.
(d)
If an Event of Default exists, the Administrative Agent may (and, if instructed by the Requisite Lenders, shall) in its (or their) discretion at any time and from time to time elect to liquidate any such investments and reinvestments and credit the proceeds thereof to the Letter of Credit Collateral Account and apply or cause to be applied such proceeds and any other balances in the Letter of Credit Collateral Account to the payment of any of the Letter of Credit Liabilities due and payable.
(e)
So long as no Default or Event of Default exists, the Administrative Agent shall, from time to time, at the request of the Borrower, deliver to the Borrower, against receipt but without any recourse, warranty or representation whatsoever, such of the balances in the Letter of Credit Collateral Account as exceed the aggregate amount of Letter of Credit Liabilities at such time. When all of the Obligations shall have been indefeasibly paid in full and no Letters of Credit remain outstanding, the Administrative Agent shall deliver to the Borrower, against receipt but without any recourse, warranty or representation whatsoever, the balances remaining in the Letter of Credit Collateral Account.
(f)
The Borrower shall pay to the Administrative Agent from time to time such reasonable fees as the Administrative Agent normally charges for similar services in connection with the Administrative Agent's administration of the Letter of Credit Collateral Account and investments and reinvestments of funds therein.
Section 11.7.
Reserved.
Section 11.8.
Performance by Administrative Agent.
If the Borrower or any other Loan Party shall fail to perform any covenant, duty or agreement contained in any of the Loan Documents, the Administrative Agent may, but shall not be obligated to, perform or attempt to perform such covenant, duty or agreement on behalf of the Borrower or such other Loan Party after the expiration of any cure or grace periods set forth herein. In such event, the Borrower shall, at the request of the Administrative Agent, promptly pay any amount reasonably expended by the Administrative Agent in such performance or attempted performance to the Administrative Agent, together with interest thereon at the applicable Post-Default Rate from the date of such expenditure until paid. Notwithstanding the foregoing, neither the Administrative Agent nor any Lender shall have any liability or responsibility whatsoever for the performance of any obligation of the Borrower under this Agreement or any other Loan Document.
Section 11.9.
Rights Cumulative.
The rights and remedies of the Administrative Agent, the Issuing Bank, the Lenders and the Specified Derivatives Providers under this Agreement, each of the other Loan Documents, the Fee Letter and Specified Derivatives Contracts shall be cumulative and not exclusive of any rights or remedies which any of them may otherwise have under Applicable Law. In exercising their respective rights and remedies the Administrative Agent, the Issuing Bank, the Lenders and the Specified Derivatives Providers may be selective and no failure or delay by the Administrative Agent, the Issuing Bank, any of the Lenders or any of the Specified Derivatives Providers in exercising any right shall operate as a waiver of it, nor shall any single or partial exercise of any power or right preclude its other or further exercise or the exercise of any other power or right.
Article XII. The Administrative Agent
Section 12.1.
Appointment and Authorization.
Each Lender hereby irrevocably appoints and authorizes the Administrative Agent to take such action as contractual representative on such Lender's behalf and to exercise such powers under this Agreement and the other Loan Documents as are specifically delegated to the Administrative Agent by the terms hereof and thereof, together with such powers as are reasonably incidental thereto. Not in limitation of the foregoing, each Lender authorizes and directs the Administrative Agent to enter into the Loan Documents for the benefit of the Lenders. Each Lender hereby agrees that, except as otherwise set forth herein, any action taken by the Requisite Lenders in accordance with the provisions of this Agreement or the Loan Documents, and the exercise by the Requisite Lenders of the powers set forth herein or therein, together with such other powers as are reasonably incidental thereto, shall be authorized and binding upon all of the Lenders. Nothing herein shall be construed to deem the Administrative Agent a trustee or fiduciary for any Lender or to impose on the Administrative Agent duties or obligations other than those expressly provided for herein. Without limiting the generality of the foregoing, the use of the terms “Agent”, “Administrative Agent”, “agent” and similar terms in the Loan Documents with reference to the Administrative Agent is not intended to connote any fiduciary or other implied (or express) obligations arising under agency doctrine of any Applicable Law. Instead, use of such terms is merely a matter of market custom, and is intended to create or reflect only an administrative relationship between independent contracting parties. The Administrative Agent shall deliver to each Lender, promptly upon receipt thereof by the Administrative Agent, copies of each of the financial statements, certificates, notices and other documents delivered to the Administrative Agent pursuant to Article IX. that the Borrower is not otherwise required to deliver directly to the Lenders. The Administrative Agent will furnish to any Lender, upon the request of such Lender, a copy (or, where appropriate, an original) of any document, instrument, agreement, certificate or notice furnished to the Administrative Agent by the Parent, the Borrower, any Loan Party or any other Affiliate of the Borrower, pursuant to this Agreement or any other Loan Document not already delivered to such Lender pursuant to the terms of this Agreement or any such other Loan Document. As to any matters not expressly provided for by the Loan Documents (including, without limitation, enforcement or collection of any of the Obligations), the Administrative Agent shall not be required to exercise any discretion or take any action, but shall be required to act or to refrain from acting (and shall be fully protected in so acting or refraining from acting) upon the instructions of the Requisite Lenders (or all of the Lenders if explicitly required under any other provision of this Agreement), and such instructions shall be binding upon all Lenders and all holders of any of the Obligations; provided, however, that, notwithstanding anything in this Agreement to the contrary, the Administrative Agent shall not be required to take any action which exposes the Administrative Agent to personal liability or which is contrary to this Agreement or any other Loan Document or Applicable Law. Not in limitation of the foregoing, the Administrative Agent may exercise any right or remedy it or the Lenders may have under any Loan Document upon the occurrence of a
Default or an Event of Default unless the Requisite Lenders have directed the Administrative Agent otherwise. Without limiting the foregoing, no Lender shall have any right of action whatsoever against the Administrative Agent as a result of the Administrative Agent acting or refraining from acting under this Agreement or any of the other Loan Documents in accordance with the instructions of the Requisite Lenders, or where applicable, all the Lenders.
Section 12.2.
Wells Fargo as Lender.
Wells Fargo, as a Lender or as a Specified Derivatives Provider, as the case may be, shall have the same rights and powers under this Agreement and any other Loan Document and under any Specified Derivatives Contract, as the case may be, as any other Lender or Specified Derivatives Provider and may exercise the same as though it were not the Administrative Agent; and the term “Lender” or “Lenders” shall, unless otherwise expressly indicated, include Wells Fargo in each case in its individual capacity. Wells Fargo and its affiliates may each accept deposits from, maintain deposits or credit balances for, invest in, lend money to, act as trustee under indentures of, serve as financial advisor to, and generally engage in any kind of business with the Borrower, any other Loan Party, the Parent or any other affiliate thereof as if it were any other bank and without any duty to account therefor to the Issuing Bank, other Lenders, or any other Specified Derivatives Providers. Further, the Administrative Agent and any affiliate may accept fees and other consideration from the Borrower for services in connection with this Agreement or any Specified Derivatives Contract, or otherwise without having to account for the same to the Issuing Bank, the other Lenders or any other Specified Derivatives Providers. The Issuing Bank and the Lenders acknowledge that, pursuant to such activities, Wells Fargo or its affiliates may receive information regarding the Parent, the Borrower, other Loan Parties, other Subsidiaries and other Affiliates (including information that may be subject to confidentiality obligations in favor of such Person) and acknowledge that the Administrative Agent shall be under no obligation to provide such information to them.
Section 12.3.
Approvals of Lenders.
All communications from the Administrative Agent to any Lender requesting such Lender's determination, consent, approval or disapproval (a) shall be given in the form of a written notice to such Lender, (b) shall be accompanied by a description of the matter or issue as to which such determination, approval, consent or disapproval is requested, or shall advise such Lender where information, if any, regarding such matter or issue may be inspected, or shall otherwise describe the matter or issue to be resolved, (c) shall include, if reasonably requested by such Lender and to the extent not previously provided to such Lender, written materials provided to the Administrative Agent by the Borrower in respect of the matter or issue to be resolved, and (d) shall include the Administrative Agent's recommended course of action or determination in respect thereof. Unless a Lender shall give written notice to the Administrative Agent that it specifically objects to the recommendation or determination of the Administrative Agent (together with a reasonable written explanation of the reasons behind such objection) within ten (10) Business Days (or such lesser or greater period as may be specifically required under the express terms of the Loan Documents) of receipt of such communication, such Lender shall be deemed to have conclusively approved of or consented to such recommendation or determination.
Section 12.4.
Notice of Events of Default.
The Administrative Agent shall not be deemed to have knowledge or notice of the occurrence of a Default or Event of Default (excepting only a Default or Event of Default under Section 11.1(a)) unless the Administrative Agent has received notice from a Lender or the Borrower referring to this Agreement,
describing with reasonable specificity such Default or Event of Default and stating that such notice is a “notice of default.” If any Lender (excluding the Lender which is also serving as the Administrative Agent) becomes aware of any Default or Event of Default, it shall promptly send to the Administrative Agent such a “notice of default”. Further, if the Administrative Agent receives such a “notice of default,” the Administrative Agent shall give prompt notice thereof to the Lenders.
Section 12.5.
Administrative Agent's Reliance.
Notwithstanding any other provisions of this Agreement or any other Loan Documents, neither the Administrative Agent nor any of its directors, officers, agents, employees or counsel shall be liable for any action taken or not taken by it under or in connection with this Agreement or any other Loan Document, except for its or their own gross negligence or willful misconduct in connection with its duties expressly set forth herein or therein as determined by a court of competent jurisdiction in a final non-appealable judgment. Without limiting the generality of the foregoing, the Administrative Agent: may consult with legal counsel (including its own counsel or counsel for the Borrower, any other Loan Party or the Parent), independent public accountants and other experts selected by it and shall not be liable for any action taken or omitted to be taken in good faith by it in accordance with the advice of such counsel, accountants or experts. Neither the Administrative Agent nor any of its directors, officers, agents, employees or counsel: (a) makes any warranty or representation to any Lender, the Issuing Bank or any other Person and shall be responsible to any Lender, the Issuing Bank or any other Person for any statement, warranty or representation made or deemed made by the Borrower, any other Loan Party, the Parent or any other Person in or in connection with this Agreement or any other Loan Document; (b) shall have any duty to ascertain or to inquire as to the performance or observance of any of the terms, covenants or conditions of this Agreement or any other Loan Document or the satisfaction of any conditions precedent under this Agreement or any Loan Document on the part of the Borrower or other Persons or inspect the property, books or records of the Borrower or any other Person; (c) shall be responsible to any Lender or the Issuing Bank for the due execution, legality, validity, enforceability, genuineness, sufficiency or value of this Agreement or any other Loan Document, any other instrument or document furnished pursuant thereto or any collateral covered thereby or the perfection or priority of any Lien in favor of the Administrative Agent on behalf of the Lenders, the Issuing Bank and the Specified Derivatives Providers in any such collateral; (d) shall have any liability in respect of any recitals, statements, certifications, representations or warranties contained in any of the Loan Documents or any other document, instrument, agreement, certificate or statement delivered in connection therewith; and (e) shall incur any liability under or in respect of this Agreement or any other Loan Document by acting upon any notice, consent, certificate or other instrument or writing (which may be by telephone, telecopy or electronic mail) believed by it to be genuine and signed, sent or given by the proper party or parties. The Administrative Agent may execute any of its duties under the Loan Documents by or through agents, employees or attorneys-in-fact and shall not be responsible for the negligence or misconduct of any agent or attorney-in-fact that it selects in the absence of gross negligence or willful misconduct as determined by a court of competent jurisdiction in a final non-appealable judgment.
Section 12.6.
Indemnification of Administrative Agent.
Regardless of whether the transactions contemplated by this Agreement and the other Loan Documents are consummated, each Lender agrees to indemnify the Administrative Agent (to the extent not reimbursed by the Borrower and without limiting the obligation of the Borrower to do so) pro rata in accordance with such Lender's respective Pro Rata Share, from and against any and all liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements of any kind or nature whatsoever which may at any time be imposed on, incurred by, or asserted against the
Administrative Agent (in its capacity as Administrative Agent but not as a “Lender”) in any way relating to or arising out of the Loan Documents, any transaction contemplated hereby or thereby or any action taken or omitted by the Administrative Agent under the Loan Documents (collectively, “Indemnifiable Amounts”); provided, however, that no Lender shall be liable for any portion of such Indemnifiable Amounts to the extent resulting from the Administrative Agent's gross negligence or willful misconduct as determined by a court of competent jurisdiction in a final, non-appealable judgment;
provided
,
however
, that no action taken in accordance with the directions of the Requisite Lenders (or all of the Lenders, if expressly required hereunder) shall be deemed to constitute gross negligence or willful misconduct for purposes of this Section. Without limiting the generality of the foregoing, each Lender agrees to reimburse the Administrative Agent (to the extent not reimbursed by the Borrower and without limiting the obligation of the Borrower to do so) promptly upon demand for its ratable share of any expenses (including the reasonable fees and expenses of outside counsel to the Administrative Agent but excluding the allocated costs, fees and expenses of the Administrative Agent's in-house counsel and legal staff and any expenses incurred by the Administrative Agent in connection with its review of any appraisal or environmental, structural or engineering report) reasonably incurred by the Administrative Agent in connection with the preparation, negotiation, execution, administration, or enforcement (whether through negotiations, legal proceedings, or otherwise) of, or legal advice with respect to the rights or responsibilities of the parties under, the Loan Documents, any suit or action brought by the Administrative Agent to enforce the terms of the Loan Documents and/or collect any Obligations, any “lender liability” suit or claim brought against the Administrative Agent and/or the Lenders, and any claim or suit brought against the Administrative Agent and/or the Lenders arising under any Environmental Laws. Such expenses (including counsel fees) shall be advanced by the Lenders on the request of the Administrative Agent notwithstanding any claim or assertion that the Administrative Agent is not entitled to indemnification hereunder upon receipt of an undertaking by the Administrative Agent that the Administrative Agent will reimburse the Lenders if it is actually and finally determined by a court of competent jurisdiction that the Administrative Agent is not so entitled to indemnification. The agreements in this Section shall survive the payment of the Loans and all other amounts payable hereunder or under the other Loan Documents and the termination of this Agreement. If the Borrower shall reimburse the Administrative Agent for any Indemnifiable Amount following payment by any Lender to the Administrative Agent in respect of such Indemnifiable Amount pursuant to this Section, the Administrative Agent shall share such reimbursement on a ratable basis with each Lender making any such payment.
Section 12.7.
Lender Credit Decision, Etc.
Each of the Lenders and the Issuing Bank expressly acknowledges and agrees that neither the Administrative Agent nor any of its officers, directors, employees, agents, counsel, attorneys-in-fact or other affiliates has made any representations or warranties to the Issuing Bank or such Lender and that no act by the Administrative Agent hereafter taken, including any review of the affairs of the Parent, the Borrower, any other Loan Party or any other Subsidiary or Affiliate, shall be deemed to constitute any such representation or warranty by the Administrative Agent to the Issuing Bank or any Lender. Each of the Lenders and the Issuing Bank acknowledges that it has, independently and without reliance upon the Administrative Agent, any other Lender or counsel to the Administrative Agent, or any of their respective officers, directors, employees, agents or counsel, and based on the financial statements of the Parent, the Borrower, the other Loan Parties, the other Subsidiaries and other Affiliates, and inquiries of such Persons, its independent due diligence of the business and affairs of the Parent, the Borrower, the other Loan Parties, the other Subsidiaries and other Persons, its review of the Loan Documents, the legal opinions required to be delivered to it hereunder, the advice of its own counsel and such other documents and information as it has deemed appropriate, made its own credit and legal analysis and decision to enter
into this Agreement and the transactions contemplated hereby. Each of the Lenders and the Issuing Bank also acknowledges that it will, independently and without reliance upon the Administrative Agent, any other Lender or counsel to the Administrative Agent or any of their respective officers, directors, employees and agents, and based on such review, advice, documents and information as it shall deem appropriate at the time, continue to make its own decisions in taking or not taking action under the Loan Documents. The Administrative Agent shall not be required to keep itself informed as to the performance or observance by the Parent, the Borrower or any other Loan Party of the Loan Documents or any other document referred to or provided for therein or to inspect the properties or books of, or make any other investigation of, the Parent, the Borrower, any other Loan Party or any other Subsidiary. Except for notices, reports and other documents and information expressly required to be furnished to the Lenders and the Issuing Bank by the Administrative Agent under this Agreement or any of the other Loan Documents, the Administrative Agent shall have no duty or responsibility to provide any Lender or the Issuing Bank with any credit or other information concerning the business, operations, property, financial and other condition or creditworthiness of the Parent, the Borrower, any other Loan Party or any other Affiliate thereof which may come into possession of the Administrative Agent or any of its officers, directors, employees, agents, attorneys-in-fact or other Affiliates. Each of the Lenders and the Issuing Bank acknowledges that the Administrative Agent's legal counsel in connection with the transactions contemplated by this Agreement is only acting as counsel to the Administrative Agent and is not acting as counsel to any Lender or the Issuing Bank.
Section 12.8.
Successor Administrative Agent.
The Administrative Agent may resign at any time as Administrative Agent under the Loan Documents by giving written notice thereof to the Lenders and the Borrower. The Administrative Agent may be removed as administrative agent by all of the Lenders (other than the Lender then acting as Administrative Agent) and the Borrower upon 30 days' prior written notice if the Administrative Agent (i) is found by a court of competent jurisdiction in a final, non-appealable judgment to have committed gross negligence or willful misconduct in the course of performing its duties hereunder or (ii) has become or is insolvent or has become the subject of a bankruptcy or insolvency proceeding, or has had a receiver, conservator, trustee or custodian appointed for it, or has taken any action in furtherance of, or indicating its consent to, approval of or acquiescence in any such proceeding or appointment. Upon any such resignation or removal, the Requisite Lenders shall have the right to appoint a successor Administrative Agent which appointment shall, provided no Default or Event of Default exists, be subject to the Borrower's approval, which approval shall not be unreasonably withheld or delayed (except that the Borrower shall, in all events, be deemed to have approved each Lender and any of its affiliates as a successor Administrative Agent). If no successor Administrative Agent shall have been so appointed in accordance with the immediately preceding sentence, and shall have accepted such appointment, within thirty (30) days after the current Administrative Agent's giving of notice of resignation or the Lenders' removal of the current Administrative Agent, then the current Administrative Agent may, on behalf of the Lenders and the Issuing Bank, appoint a successor Administrative Agent, which shall be a Lender, if any Lender shall be willing to serve, and otherwise shall be an Eligible Assignee. Upon the acceptance of any appointment as Administrative Agent hereunder by a successor Administrative Agent, such successor Administrative Agent shall thereupon succeed to and become vested with all the rights, powers, privileges and duties of the current Administrative Agent, and the current Administrative Agent shall be discharged from its duties and obligations under the Loan Documents. Such successor Administrative Agent shall issue letters of credit in substitution for the Letters of Credit, if any, outstanding at the time of such succession or shall make other arrangements satisfactory to the current Administrative Agent, in either case, to assume effectively the obligations of the current Administrative Agent with respect to such Letters of Credit. After any Administrative Agent's resignation or removal hereunder as Administrative
Agent, the provisions of this Article XII. shall continue to inure to its benefit as to any actions taken or omitted to be taken by it while it was Administrative Agent under the Loan Documents. Notwithstanding anything contained herein to the contrary, the Administrative Agent may assign its rights and duties under the Loan Documents to any of its affiliates by giving the Borrower and each Lender prior written notice.
Section 12.9.
Titled Agents.
The Syndication Agent, each Documentation Agent and each Co-Lead Arranger (each a “Titled Agent”) in each such respective capacity, assumes no responsibility or obligation hereunder, including, without limitation, for servicing, enforcement or collection of any of the Loans, nor any duties as an agent hereunder for the Lenders. The titles given to the Titled Agents are solely honorific and imply no fiduciary responsibility on the part of the Titled Agents to the Administrative Agent, any Lender, the Parent, the Borrower or any other Loan Party and the use of such titles does not impose on the Titled Agents any duties or obligations greater than those of any other Lender or entitle the Titled Agents to any rights other than those to which any other Lender is entitled.
Article XIII. Miscellaneous
Section 13.1.
Notices.
Unless otherwise provided herein (including without limitation as provided in Section 9.5.), communications provided for hereunder shall be in writing and shall be mailed, telecopied, or delivered as follows:
If to the Borrower:
CBL & Associates Limited Partnership
c/o CBL & Associates Properties, Inc.
2030 Hamilton Place Blvd., Suite 500
Chattanooga, Tennessee 37421-6000
Attention: Chief Financial Officer
Telecopy Number:
(423) 490-8390
Telephone Number:
(423) 855-0001
with an informational copy to:
CBL & Associates Limited Partnership
c/o CBL & Associates Properties, Inc.
2030 Hamilton Place Blvd., Suite 500
Chattanooga, Tennessee 37421-6000
Attention: Finance Counsel
Telecopy Number:
(423) 490-8390
Telephone Number:
(423) 855-0001
If to the Administrative Agent:
Wells Fargo Bank, National Association
123 North Wacker Drive, Suite 1900
Chicago, IL 60606
Attn: Loan Administration
Telecopier Number: 312/782-0969
Telephone Number: 312/269-8250
If to the Issuing Bank:
Wells Fargo Bank, National Association
123 North Wacker Drive, Suite 1900
Chicago, IL 60606
Attn: Loan Administration
Telecopier Number: 312/782-0969
Telephone Number: 312/269-8250
If to any other Lender:
To such Lender's address or telecopy number as set forth in the applicable Administrative Questionnaire.
or, as to each party at such other address as shall be designated by such party in a written notice to the other parties delivered in compliance with this Section; provided, a Lender or the Issuing Bank shall only be required to give notice of any such other address to the Administrative Agent and the Borrower. All such notices and other communications shall be effective (i) if mailed, upon the first to occur of receipt or the expiration of three (3) days after the deposit in the United States Postal Service mail, postage prepaid and addressed to the address of the Borrower or the Administrative Agent, the Issuing Bank and Lenders at the addresses specified; (ii) if telecopied, upon confirmation of transmission; (iii) if hand delivered or sent by overnight courier, when delivered; or (iv) if delivered in accordance with Section 9.5. to the extent applicable; provided, however, that, in the case of the immediately preceding clauses (i), (ii) and (iii), non-receipt of any communication as of the result of any change of address of which the sending party was not notified or as the result of a refusal to accept delivery shall be deemed receipt of such communication. Notwithstanding the immediately preceding sentence, all notices or communications to the Administrative Agent, the Issuing Bank or any Lender under Articles II. and IV. shall be effective only when actually received. None of the Administrative Agent, the Issuing Bank or any Lender shall incur any liability to the Parent, the Borrower or any Loan Party (nor shall the Administrative Agent incur any liability to the Lenders) for acting upon any telephonic notice referred to in this Agreement which the Administrative Agent, the Issuing Bank or such Lender, as the case may be, believes in good faith to have been given by a Person authorized to deliver such notice or for otherwise acting in good faith hereunder. In addition to the Administrative Agent's Lending Office, the Borrower shall send copies of the notices described in Article II. to the following address of the Administrative Agent:
Wells Fargo Bank, National Association
Minneapolis Loan Center
608 2nd Avenue South, 11th Floor
Minneapolis, MN 55402
Attention: Treva Lee
Telecopier Number: 877/718-0796
Telephone Number: 612/316-4317
Section 13.2.
Expenses.
The Borrower agrees (a) to pay or reimburse the Administrative Agent for all of its reasonable costs and expenses incurred in connection with the preparation, negotiation and execution of, and any amendment, supplement or modification to, any of the Loan Documents (including due diligence expense and reasonable travel expenses related to closing), and the consummation of the transactions contemplated hereby and thereby, including the reasonable fees and disbursements of counsel to the Administrative Agent and all costs and expenses of the Administrative Agent in connection with the use of IntraLinks, SyndTrak or other similar information transmission systems in connection with the Loan Documents and the reasonable fees and disbursements of counsel to the Administrative Agent relating to all such activities, (b) to pay to the Issuing Bank all reasonable out-of-pocket costs and expenses incurred by the Issuing Bank in connection with the issuance, amendment, renewal or extension of any Letter of Credit or any demand for payment thereunder, (c) to pay or reimburse the Administrative Agent, the Issuing Bank and the Lenders for all their reasonable costs and expenses incurred in connection with the enforcement or preservation of any rights under the Loan Documents and the Fee Letter, including the reasonable fees and disbursements of counsel retained by the Administrative Agent and of one law firm retained by the Lenders (including the allocated fees and expenses of in-house counsel) and any payments in indemnification or otherwise payable by the Lenders to the Administrative Agent pursuant to the Loan Documents, (d) to pay, and indemnify and hold harmless the Administrative Agent, the Issuing Bank and the Lenders from, any and all recording and filing fees and any and all liabilities with respect to, or resulting from any failure to pay or delay in paying, documentary, stamp, excise and other similar taxes, if any, which may be payable or determined to be payable in connection with the execution and delivery of any of the Loan Documents, or consummation of any amendment, supplement or modification of, or any waiver or consent under or in respect of, any Loan Document and (e) to the extent not already covered by any of the preceding subsections, to pay the reasonable fees and disbursements of counsel to the Administrative Agent, the Issuing Bank and any Lender incurred in connection with the representation of the Administrative Agent, the Issuing Bank or such Lender in any matter relating to or arising out of any bankruptcy or other proceeding of the type described in Sections 11.1.(e) or 11.1.(f), including, without limitation (i) any motion for relief from any stay or similar order, (ii) the negotiation, preparation, execution and delivery of any document relating to the Obligations and (iii) the negotiation and preparation of any debtor-in-possession financing or any plan of reorganization of the Parent, the Borrower or any other Loan Party, whether proposed by the Parent, the Borrower, such Loan Party, the Lenders or any other Person, and whether such fees and expenses are incurred prior to, during or after the commencement of such proceeding or the confirmation or conclusion of any such proceeding. If the Borrower shall fail to pay any amounts required to be paid by it pursuant to this Section, the Administrative Agent and/or the Lenders may pay such amounts on behalf of the Borrower and such amounts shall be deemed to be Obligations owing hereunder.
Section 13.3.
Stamp, Intangible and Recording Taxes.
The Borrower will pay any and all stamp, excise, intangible, registration, recordation and similar taxes, fees or charges and shall indemnify the Administrative Agent and each Lender against any and all liabilities with respect to or resulting from any delay in the payment or omission to pay any such taxes, fees or charges, which may be payable or determined to be payable in connection with the execution, delivery, recording, performance or enforcement of this Agreement, the Notes and any of the other Loan Documents, the amendment, supplement, modification or waiver of or consent under this Agreement, the Notes or any of the other Loan Documents or the perfection of any rights or Liens under this Agreement, the Notes or any of the other Loan Documents.
Section 13.4.
Setoff.
Subject to Section 3.3. and in addition to any rights now or hereafter granted under Applicable Law and not by way of limitation of any such rights, the Borrower hereby authorizes the Administrative Agent, the Issuing Bank, each Lender, each Affiliate of the Administrative Agent, the Issuing Bank or any Lender, and each Participant, at any time or from time to time while an Event of Default exists, without notice to the Borrower or to any other Person, any such notice being hereby expressly waived, but in the case of the Issuing Bank, a Lender, an Affiliate of the Issuing Bank or a Lender, or a Participant, subject to receipt of the prior written consent of the Requisite Lenders exercised in their sole discretion, to set off and to appropriate and to apply any and all deposits (general or special, including, but not limited to, indebtedness evidenced by certificates of deposit, whether matured or unmatured) and any other indebtedness at any time held or owing by the Administrative Agent, the Issuing Bank, such Lender, any Affiliate of the Administrative Agent, the Issuing Bank or such Lender, or such Participant, to or for the credit or the account of the Borrower against and on account of any of the Obligations, irrespective of whether or not any or all of the Loans and all other Obligations have been declared to be, or have otherwise become, due and payable as permitted by Section 11.2., and although such Obligations shall be contingent or unmatured. Notwithstanding the foregoing, each Lender hereby waives any right of setoff against the Obligations it has with respect to any deposit account of any Guarantor (other than the Parent) maintained with such Lender or any other account or property of such Guarantor held by such Lender; provided however, that this waiver is not intended, and shall not be deemed, to waive any right of setoff (a) any Lender has with respect to any account required to be maintained pursuant to this Agreement or any other Loan Document or (b) arising other than pursuant to this Agreement or the other Loan Documents.
Section 13.5.
Litigation; Jurisdiction; Other Matters; Waivers.
(a)
EACH PARTY HERETO ACKNOWLEDGES THAT ANY DISPUTE OR CONTROVERSY BETWEEN OR AMONG THE BORROWER, THE PARENT, THE ADMINISTRATIVE AGENT, THE ISSUING BANK OR ANY OF THE LENDERS WOULD BE BASED ON DIFFICULT AND COMPLEX ISSUES OF LAW AND FACT AND WOULD RESULT IN DELAY AND EXPENSE TO THE PARTIES. ACCORDINGLY, TO THE EXTENT PERMITTED BY APPLICABLE LAW, EACH OF THE LENDERS, THE ADMINISTRATIVE AGENT, THE ISSUING BANK, THE BORROWER AND THE PARENT HEREBY WAIVES ITS RIGHT TO A TRIAL BY JURY IN ANY ACTION OR PROCEEDING OF ANY KIND OR NATURE IN ANY COURT OR TRIBUNAL IN WHICH AN ACTION MAY BE COMMENCED BY OR AGAINST ANY PARTY HERETO ARISING OUT OF THIS AGREEMENT, THE NOTES, OR ANY OTHER LOAN DOCUMENT OR THE FEE LETTER OR BY REASON OF ANY OTHER SUIT, CAUSE OF ACTION OR DISPUTE WHATSOEVER BETWEEN OR AMONG THE BORROWER, THE PARENT, THE ADMINISTRATIVE AGENT, THE ISSUING BANK OR ANY OF THE LENDERS OF ANY KIND OR NATURE.
(b)
THE BORROWER AND EACH OTHER LOAN PARTY IRREVOCABLY AND UNCONDITIONALLY AGREES THAT IT WILL NOT COMMENCE ANY ACTION, LITIGATION OR PROCEEDING OF ANY KIND OR DESCRIPTION, WHETHER IN LAW OR EQUITY, WHETHER IN CONTRACT OR IN TORT OR OTHERWISE, AGAINST THE ADMINISTRATIVE AGENT, ANY LENDER, THE ISSUING BANK, OR ANY RELATED PARTY OF THE FOREGOING IN ANY WAY RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS RELATING HERETO OR THERETO, IN ANY FORUM OTHER THAN THE COURTS OF THE STATE OF NEW YORK 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, AND EACH OF THE PARTIES HERETO IRREVOCABLY AND UNCONDITIONALLY SUBMITS TO THE JURISDICTION OF SUCH COURTS AND AGREES THAT ALL CLAIMS IN RESPECT OF ANY SUCH ACTION, LITIGATION OR PROCEEDING MAY BE HEARD AND DETERMINED IN SUCH NEW YORK STATE COURT OR, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, IN SUCH FEDERAL COURT. EACH OF THE PARTIES HERETO AGREES THAT A FINAL, NON-APPEALABLE JUDGMENT IN ANY SUCH ACTION, LITIGATION 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 AGREEMENT OR IN ANY OTHER LOAN DOCUMENT SHALL AFFECT ANY RIGHT THAT THE ADMINISTRATIVE AGENT, ANY LENDER OR THE ISSUING BANK MAY OTHERWISE HAVE TO BRING ANY ACTION OR PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT AGAINST THE BORROWER OR ANY OTHER LOAN PARTY OR ITS PROPERTIES IN THE COURTS OF ANY JURISDICTION. EACH PARTY FURTHER WAIVES ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH ACTION OR PROCEEDING IN ANY SUCH COURT OR THAT SUCH ACTION OR PROCEEDING WAS BROUGHT IN AN INCONVENIENT FORUM AND EACH AGREES NOT TO PLEAD OR CLAIM THE SAME. THE CHOICE OF FORUM SET FORTH IN THIS SECTION SHALL NOT BE DEEMED TO PRECLUDE THE BRINGING OF ANY ACTION BY THE ADMINISTRATIVE AGENT, THE ISSUING BANK OR ANY LENDER OR THE ENFORCEMENT BY THE ADMINISTRATIVE AGENT, THE ISSUING BANK OR ANY LENDER OF ANY JUDGMENT OBTAINED IN SUCH FORUM IN ANY OTHER APPROPRIATE JURISDICTION.
(c)
THE BORROWER HEREBY WAIVES PERSONAL SERVICE OF THE SUMMONS AND COMPLAINT, OR OTHER PROCESS OR PAPERS ISSUED THEREIN, AND AGREES THAT SERVICE OF SUCH SUMMONS AND COMPLAINT, OR OTHER PROCESS OR PAPERS MAY BE MADE BY REGISTERED OR CERTIFIED MAIL ADDRESSED TO THE BORROWER AT ITS ADDRESS FOR NOTICES PROVIDED FOR HEREIN. SHOULD THE BORROWER FAIL TO APPEAR OR ANSWER ANY SUMMONS, COMPLAINT, PROCESS OR PAPERS SO SERVED WITHIN THIRTY (30) DAYS AFTER THE MAILING THEREOF, THE BORROWER SHALL BE DEEMED IN DEFAULT AND AN ORDER AND/OR JUDGMENT MAY BE ENTERED AGAINST IT AS DEMANDED OR PRAYED FOR IN SUCH SUMMONS, COMPLAINT, PROCESS OR PAPERS.
(d)
THE PROVISIONS OF THIS SECTION HAVE BEEN CONSIDERED BY EACH PARTY WITH THE ADVICE OF COUNSEL AND WITH A FULL UNDERSTANDING OF THE LEGAL CONSEQUENCES THEREOF, AND SHALL SURVIVE THE PAYMENT OF THE LOANS AND ALL OTHER AMOUNTS PAYABLE HEREUNDER OR UNDER THE OTHER LOAN DOCUMENTS, THE TERMINATION OR EXPIRATION OF ALL LETTERS OF CREDIT AND THE TERMINATION OF THIS AGREEMENT.
Section 13.6.
Successors and Assigns.
(a)
Successors and Assigns Generally
. The provisions of this Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns permitted hereby, except that neither the Borrower nor any other Loan Party may assign or otherwise transfer any of its rights or obligations hereunder without the prior written consent of the Administrative Agent and each Lender and no Lender may assign or otherwise transfer any of its rights or obligations hereunder except (i) to an Eligible Assignee in accordance with the provisions of the immediately following subsection (b),
(ii) by way of participation in accordance with the provisions of the immediately following subsection (d) or (iii) by way of pledge or assignment of a security interest subject to the restrictions of the immediately following subsection (f) (and, subject to the last sentence of the immediately following subsection (b), any other attempted assignment or transfer by any party hereto shall be null and void). Nothing in this Agreement, expressed or implied, shall be construed to confer upon any Person (other than the parties hereto, their respective successors and assigns permitted hereby, Participants to the extent provided in the immediately following subsection (d) and, to the extent expressly contemplated hereby, the Related Parties of the Administrative Agent and the Lenders) any legal or equitable right, remedy or claim under or by reason of this Agreement.
(b)
Assignments by Lenders
. Any Lender may at any time assign to one or more Eligible Assignees all or a portion of its rights and obligations under this Agreement (including all or a portion of its Commitment and the Loans at the time owing to it);
provided
that any such assignment shall be subject to the following conditions:
(i)
Minimum Amounts
.
(A)
in the case of an assignment of the entire remaining amount of an assigning Lender's Revolving Commitment and the Loans at the time owing to it, or in the case of an assignment to a Lender, an Affiliate of a Lender or an Approved Fund, no minimum amount need be assigned; and
(B)
in any case not described in the immediately preceding subsection (A), the aggregate amount of the Revolving Commitment (which for this purpose includes Loans outstanding thereunder) or, if the applicable Revolving Commitment is not then in effect, the principal outstanding balance of the Loans of the assigning Lender subject to each such assignment (as determined as of the date the Assignment and Assumption with respect to such assignment is delivered to the Administrative Agent or, if “Trade Date” is specified in the Assignment and Assumption, as of the Trade Date) shall not be less than $5,000,000 in the case of any assignment of a Revolving Commitment, unless each of the Administrative Agent and, so long as no Default or Event of Default shall exist, the Borrower otherwise consents (each such consent not to be unreasonably withheld or delayed); provided, however, that if, after giving effect to such assignment, the amount of the Commitment held by such assigning Lender or the outstanding principal balance of the Loans of such assigning Lender, as applicable, would be less than $5,000,000 in the case of a Commitment or Revolving Loans, then such assigning Lender shall assign the entire amount of its Commitment and the Loans at the time owing to it.
(ii)
Proportionate Amounts
. Each partial assignment shall be made as an assignment of a proportionate part of all the assigning Lender's rights and obligations under this Agreement with respect to the Loan or the Revolving Commitment assigned.
(iii)
Required Consents
. No consent shall be required for any assignment except to the extent required by clause (i)(B) of this subsection (b) and, in addition:
(A)
the consent of the Borrower (such consent not to be unreasonably withheld or delayed) shall be required unless (x) a Default or Event of Default shall exist at the time of such assignment or (y) such assignment is to a Lender, an Affiliate of a Lender or an Approved Fund; provided that the Borrower shall be deemed to have
consented to any such assignment unless it shall object thereto by written notice to the Administrative Agent within five (5) Business Days after having received notice thereof;
(B)
the consent of the Administrative Agent (such consent not to be unreasonably withheld or delayed) shall be required for assignments in respect of a Revolving Commitment if such assignment is to a Person that is not already a Lender with a Commitment, an Affiliate of such a Lender or an Approved Fund with respect to such a Lender; and
(C)
the consent of the Swingline Lender and the Issuing Bank (such consent not to be unreasonably withheld or delayed) shall be required for any assignment in respect of a Revolving Commitment.
(iv)
Assignment and Acceptance; Notes
. The parties to each assignment shall execute and deliver to the Administrative Agent an Assignment and Acceptance, together with a processing and recordation fee of $4,500 for each assignment ($7,500 for any Defaulting Lender), and the assignee, if it is not a Lender, shall deliver to the Administrative Agent an Administrative Questionnaire. If requested by the transferor Lender or the assignee, upon the consummation of any assignment, the transferor Lender, the Administrative Agent and the Borrower shall make appropriate arrangements so that new Notes are issued to the assignee and such transferor Lender, as appropriate.
(v)
No Assignment to Borrower
. No such assignment shall be made to the Borrower or any of the Borrower's Affiliates or Subsidiaries.
(vi)
No Assignment to Natural Persons
. No such assignment shall be made to a natural person.
(vii)
Assignments by Specified Derivatives Provider
. If the assigning Lender (or its Affiliate) is a Specified Derivatives Provider and if after giving effect to such assignment such Lender will hold no further Loans or Revolving Commitments under this Agreement, such Lender shall undertake such assignment only contemporaneously with an assignment by such Lender (or its Affiliate, as the case may be) of all of its Specified Derivatives Contracts to the assignee or another Lender (or Affiliate thereof).
Subject to acceptance and recording thereof by the Administrative Agent pursuant to the immediately following subsection (c), from and after the effective date specified in each Assignment and Acceptance, the assignee thereunder shall be a party to this Agreement and, to the extent of the interest assigned by such Assignment and Assumption, have the rights and obligations of a Lender under this Agreement, and the assigning Lender thereunder shall, to the extent of the interest assigned by such Assignment and Assumption, be released from its obligations under this Agreement (and, in the case of an Assignment and Assumption covering all of the assigning Lender's rights and obligations under this Agreement, such Lender shall cease to be a party hereto) but shall continue to be entitled to the benefits of Sections 5.4., 13.2. and 13.10. and the other provisions of this Agreement and the other Loan Documents as provided in Section 13.11. with respect to facts and circumstances occurring prior to the effective date of such assignment. Any assignment or transfer by a Lender of rights or obligations under this Agreement that does not comply with this paragraph shall be treated for purposes of this Agreement as a sale by such Lender of a participation in such rights and obligations in accordance with the immediately following subsection (d).
(c)
Register
. The Administrative Agent, acting solely for this purpose as an agent of the Borrower, shall maintain at the Principal Office a copy of each Assignment and Assumption delivered to it and a register for the recordation of the names and addresses of the Lenders, and the Commitments of, and principal amounts of the Loans owing to, each Lender pursuant to the terms hereof from time to time (the “Register”). The entries in the Register shall be conclusive, and the Borrower, the Administrative Agent and the Lenders may treat each Person whose name is recorded in the Register pursuant to the terms hereof as a Lender hereunder for all purposes of this Agreement, notwithstanding notice to the contrary. The Register shall be available for inspection by the Borrower and any Lender, at any reasonable time and from time to time upon reasonable prior notice. Each Lender that sells a participation as described in Section 13.6.(d) shall, acting solely for this purpose as an agent of the Borrower, maintain a register on which it enters the name and address of each Participant and the principal amounts (and stated interest) of each Participant's interest in the Loans or other obligations under this Agreement (the “Participant Register”); provided that no Lender shall have any obligation to disclose all or any portion of the Participant Register to any Person (including the identity of any Participant or any information relating to a Participant's interest in any Commitments, Loans, or its other obligations under this Agreement) 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 Treasury Regulations. 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.
(d)
Participations
. Any Lender may at any time, without the consent of, or notice to, the Borrower or the Administrative Agent, sell participations to any Person (other than a natural person or the Borrower or any of the Borrower'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 Loans 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) the Borrower, the Administrative 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 (w) increase such Lender's Commitment, (x) extend the date fixed for the payment of principal on the Loans or portions thereof owing to such Lender, (y) reduce the rate at which interest is payable thereon or (z) release any Guarantor from its Obligations under the Guaranty. Subject to the immediately following subsection (e), the Borrower agrees that each Participant shall be entitled to the benefits of Sections 3.10., 5.1., 5.4.
to the same extent as if it were a Lender and had acquired its interest by assignment pursuant to paragraph (b) of this Section. To the extent permitted by Applicable Law, each Participant also shall be entitled to the benefits of Section 13.4. as though it were a Lender, provided such Participant agrees to be subject to Section 3.3. as though it were a Lender.
(e)
Limitations upon Participant Rights
. A Participant shall not be entitled to receive any greater payment under Sections 3.10. and 5.1. 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 the Borrower's prior written consent. A Participant that would be a Foreign Lender if it were a Lender shall not be entitled to the benefits of Section 3.10. unless the Borrower is notified of the participation sold to such Participant and such Participant agrees, for the benefit of the Borrower and the Administrative Agent, to comply with Section 3.10.(c) as though it were a Lender.
(f)
Certain Pledges
. Any Lender may at any time pledge or assign a security interest in all or any portion of its rights under this Agreement to secure obligations of such Lender, including any pledge or assignment to secure obligations to a Federal Reserve Bank; provided that no such pledge or assignment shall release such Lender from any of its obligations hereunder or substitute any such pledgee or assignee for such Lender as a party hereto.
(g)
No Registration
. Each Lender agrees that, without the prior written consent of the Borrower and the Administrative Agent, it will not make any assignment hereunder in any manner or under any circumstances that would require registration or qualification of, or filings in respect of, any Loan or Note under the Securities Act or any other securities laws of the United States of America or of any other jurisdiction.
Section 13.7.
Amendments and Waivers.
(a)
Generally
. Except as otherwise expressly provided in this Agreement, (i) any consent or approval required or permitted by this Agreement or in any Loan Document to be given by the Lenders may be given, (ii) any term of this Agreement or of any other Loan Document (other than any fee letter solely between Borrower and the Administrative Agent) may be amended, (iii) the performance or observance by the Borrower or any other Loan Party of any terms of this Agreement or such other Loan Document (other than any fee letter solely between Borrower and the Administrative Agent) may be waived, and (iv) 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 Requisite Lenders (or the Administrative Agent at the written direction of the Requisite Lenders), and, in the case of an amendment to any Loan Document, the written consent of each Loan Party which is party thereto. Subject to the immediately following subsection (c), any term of this Agreement or of any other Loan Document relating to the rights or obligations of the Lenders may be amended, and the performance or observance by the Borrower or any other Loan Party or any Subsidiary of any such terms may be waived (either generally or in a particular instance and either retroactively or prospectively) with, and only with, the written consent of the Requisite Lenders (and, in the case of an amendment to any Loan Document, the written consent of each Loan Party a party thereto). Notwithstanding anything to the contrary set forth in this Section 13.7.(a), the Administrative Agent shall be authorized on behalf of all the Lenders, without the necessity of any notice to, or further consent from, any Lender, to waive the imposition of the late fees provided in Section 2.8.
(b)
Unanimous Consent of Lenders Directly Affected
. Notwithstanding the foregoing, no amendment, waiver or consent shall, unless in writing, and signed by all of the Lenders directly and adversely affected thereby (or the Administrative Agent at the written direction of the Lenders), do any of the following:
(i)
increase the Commitments of the Lenders (excluding any increase as a result of an assignment of Commitments permitted under Section 13.6. and any increases contemplated under Section 2.17.)
or subject the Lenders to any additional obligations;
(ii)
reduce the principal of, or interest rates that have accrued or that will be charged on the outstanding principal amount of, any Loans or other Obligations;
(iii)
reduce the amount of any Fees payable to the Lenders hereunder ; provided, however, the Administrative Agent shall be authorized on behalf of all Lenders, without the necessity of any notice to, or further consent from, any Lender, to waive the
imposition of the late fees provided in Section 2.8., up to a maximum of three (3) times per calendar year;
(iv)
postpone any date fixed for any payment of principal of, or interest on, any Loans or for the payment of Fees or any other Obligations, or extend the expiration date of any Letter of Credit beyond the Maturity Date except in accordance with Section 2.13.;
(v)
change the definitions of Revolving Commitment Percentage or Pro Rata Share (excluding any change as a result of an assignment of Commitments permitted under Section 13.6.);
(vi)
amend this Section or amend the definitions of the terms used in this Agreement or the other Loan Documents insofar as such definitions affect the substance of this Section;
(vii)
modify the definition of the term “Requisite Lenders” or modify in any other manner the number or percentage of the Lenders required to make any determinations or waive any rights hereunder or to modify any provision hereof;
(viii)
release any Guarantor from its obligations under the Guaranty
except as contemplated by Section 8.14.(b) or release Parent from the Parent Guaranty;
(ix)
waive a Default or Event of Default under Section 11.1.(a); or
(x)
amend, or waive the Borrower's compliance with, Section 2.15.
(c)
Amendment or Waiver by Administrative Agent
. The Administrative Agent may, subject to the terms of subsections (a) and (b) above, (i) approve any amendment to this Agreement that is administrative in nature or is otherwise reasonably determined by the Administrative Agent in good faith not to be material, and (ii) waive any obligation or waive or confirm as cured any default of any Loan Party hereunder or under any of the Loan Documents, to the extent such waiver is administrative in nature or such obligation or default is otherwise reasonably determined by the Administrative Agent in good faith not to be material.
(d)
Amendment of Administrative Agent's Duties, Etc
. No amendment, waiver or consent unless in writing and signed by the Administrative Agent, in addition to the Lenders required hereinabove to take such action, shall affect the rights or duties of the Administrative Agent under this Agreement or any of the other Loan Documents. Any amendment, waiver or consent relating to Section 2.3. or the obligations of the Swingline Lender under this Agreement or any other Loan Document shall, in addition to the Lenders required hereinabove to take such action, require the written consent of the Swingline Lender. Any amendment, waiver or consent relating to Section 2.2. or the obligations of the Issuing Bank under this Agreement or any other Loan Document shall, in addition to the Lenders required hereinabove to take such action, require the written consent of the Issuing Bank. Any amendment, waiver or consent with respect to any Loan Document that (i) diminishes the rights of a Specified Derivatives Provider in a manner or to an extent dissimilar to that affecting the Lenders or (ii) increases the liabilities or obligations of a Specified Derivatives Provider shall, in addition to the Lenders required hereinabove to take such action, require the consent of the Lender that is (or having an Affiliate that is) such Specified Derivatives Provider. No waiver shall extend to or affect any obligation not expressly waived or impair any right consequent thereon and any amendment, waiver or consent shall be effective only in the specific instance and for the specific purpose set forth therein. No course of dealing or delay or omission on the part of the
Administrative Agent or any Lender in exercising any right shall operate as a waiver thereof or otherwise be prejudicial thereto. Any Event of Default occurring hereunder shall continue to exist until such time as such Event of Default is waived in writing in accordance with the terms of this Section, notwithstanding any attempted cure or other action by the Parent, the Borrower, any other Loan Party or any other Person subsequent to the occurrence of such Event of Default. Except as otherwise explicitly provided for herein or in any other Loan Document, no notice to or demand upon the Borrower shall entitle the Borrower to other or further notice or demand in similar or other circumstances.
Section 13.8.
Non-Liability of Administrative Agent and Lenders.
The relationship between the Borrower, on the one hand, and the Lenders, the Issuing Bank and the Administrative Agent, on the other hand, shall be solely that of borrower and lender. Neither the Administrative Agent, the Issuing Bank nor any Lender shall have any fiduciary responsibilities to the Borrower and no provision in this Agreement or in any of the other Loan Documents, and no course of dealing between or among any of the parties hereto, shall be deemed to create any fiduciary duty owing by the Administrative Agent, the Issuing Bank or any Lender to any Lender, the Parent, the Borrower, any Subsidiary or any other Loan Party. Neither the Administrative Agent, the Issuing Bank nor any Lender undertakes any responsibility to the Borrower or the Parent to review or inform the Borrower or the Parent of any matter in connection with any phase of the business or operations of the Borrower, the Parent or any of their respective Subsidiaries or Affiliates.
Section 13.9.
Confidentiality.
Except as otherwise provided by Applicable Law, the Administrative Agent, the Issuing Bank and each Lender shall maintain the confidentiality of all Information (as defined below) in accordance with its customary procedure for handling confidential information of this nature and in accordance with safe and sound banking practices but in any event may make disclosure: (a) to its Affiliates and to its and its Affiliates' respective 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); (b) subject to an agreement containing provisions substantially the same as those of this Section, to (i) any actual or proposed assignee, Participant or other transferee in connection with a potential transfer of any Commitment or participation therein as permitted hereunder, or (ii) any actual or prospective counterparty (or its advisors) to any swap or derivative transaction relating to the Borrower and its obligations; (c) as required or requested by any Governmental Authority or representative thereof or pursuant to legal process or in connection with any legal proceedings, or as otherwise required by Applicable Law; (d) to the Administrative Agent's, Issuing Bank's or such Lender's independent auditors and other professional advisors (provided they shall be notified of the confidential nature of the information); (e) in connection with the exercise of any remedies under any Loan Document (or any Specified Derivatives Contract) or any action or proceeding relating to any Loan Document (or any such Specified Derivatives Contract) or the enforcement of rights hereunder or thereunder; (f) to the extent such Information (i) becomes publicly available other than as a result of a breach of this Section actually known by the Administrative Agent, the Issuing Bank or such Lender to be a breach of this Section or (ii) becomes available to the Administrative Agent, the Issuing Bank, any Lender or any Affiliate of the Administrative Agent, the Issuing Bank or any Lender on a non-confidential basis from a source other than the Borrower or any Affiliate of the Borrower; (g) to the extent requested by, or required to be disclosed to, any nationally recognized rating agency or regulatory or similar authority (including any self-regulatory authority, such as the National Association of Insurance Commissioners) having or purporting to have jurisdiction over it; (h) to bank trade publications, such information to consist of deal terms and other information
customarily found in such publications; (i) to any other party hereto; and (j) with the consent of the Borrower. Notwithstanding the foregoing, the Administrative Agent, the Issuing Bank and each Lender may disclose any such confidential information, without notice to the Borrower or any other Loan Party, to Governmental Authorities in connection with any regulatory examination of the Administrative Agent, the Issuing Bank or such Lender or in accordance with the regulatory compliance policy of the Administrative Agent, the Issuing Bank or such Lender. As used in this Section, the term “Information” means all information received from the Borrower, any other Loan Party, any other Subsidiary or Affiliate relating to any Loan Party or any of their respective businesses, other than any such information that is available to the Administrative Agent, any Lender or the Issuing Bank on a non-confidential basis prior to disclosure by the Borrower, any other Loan Party, any other Subsidiary or any Affiliate, provided that, in the case of any such information received from the Borrower, any other Loan Party, any other Subsidiary or any Affiliate after the date hereof, such information is clearly identified at the time of delivery as confidential. 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.
Section 13.10.
Indemnification.
(a)
The Borrower shall and hereby agrees to indemnify, defend and hold harmless the Administrative Agent, the Issuing Bank, the Lenders, all of the Affiliates of the Administrative Agent, each of the Lenders and the Issuing Bank and their respective directors, officers, shareholders, agents, employees and counsel (each referred to herein as an "Indemnified Party") from and against any and all of the following (collectively, the “Indemnified Costs”): losses, costs, claims, penalties, damages, liabilities, deficiencies, judgments or expenses of every kind and nature (including, without limitation, amounts paid in settlement, court costs and the fees and disbursements of counsel incurred in connection with any litigation, investigation, claim or proceeding or any advice rendered in connection therewith, but excluding Indemnified Costs indemnification in respect of which is specifically covered by Section 3.10. or 5.1. or expressly excluded from the coverage of such Sections) incurred by an Indemnified Party in connection with, arising out of, or by reason of, any suit, cause of action, claim, arbitration, investigation or settlement, consent decree or other proceeding (the foregoing referred to herein as an "Indemnity Proceeding") which is in any way related directly or indirectly to: (i) this Agreement or any other Loan Document or the transactions contemplated thereby; (ii) the making of any Loans or issuance of Letters of Credit hereunder; (iii) any actual or proposed use by the Borrower of the proceeds of the Loans or Letters of Credit; (iv) the Administrative Agent's, the Issuing Bank's or any Lender's entering into this Agreement or any other Loan Document; (v) the fact that the Administrative Agent, the Issuing Bank and the Lenders have established the credit facility evidenced hereby in favor of the Borrower; (vi) the fact that the Administrative Agent, the Issuing Bank and the Lenders are creditors of the Borrower and have or are alleged to have information regarding the financial condition, strategic plans or business operations of the Borrower and the Subsidiaries; (vii) the fact that the Administrative Agent, the Issuing Bank and the Lenders are material creditors of the Borrower and are alleged to influence directly or indirectly the business decisions or affairs of the Borrower and the Subsidiaries or their financial condition; (viii) the exercise of any right or remedy the Administrative Agent, the Issuing Bank or the Lenders may have under this Agreement or the other Loan Documents; provided, however, that the Borrower shall not be obligated to indemnify any Indemnified Party as set forth above for any acts or omissions of such Indemnified Party in connection with matters described in this clause (viii) that constitute gross negligence or willful misconduct on the part of such Indemnified Party as determined in a final non-appealable judgment by a court of competent jurisdiction; (ix) any civil penalty or fine assessed by the OFAC against, and all costs and expenses (including counsel fees and disbursements) incurred in
connection with defense thereof by, the Administrative Agent, the Issuing Bank or any Lender as a result of conduct of the Borrower, any other Loan Party or any other Subsidiary that violates a sanction administered or enforced by the OFAC; or (x) any violation or non-compliance by the Borrower or any Subsidiary of any Applicable Law (including any Environmental Law) including, but not limited to, any Indemnity Proceeding commenced by (A) the Internal Revenue Service or state taxing authority or (B) any Governmental Authority or other Person under any Environmental Law, including any Indemnity Proceeding commenced by a Governmental Authority or other Person seeking remedial or other action to cause the Borrower, its Subsidiaries or any other Loan Party (or its respective properties) (or the Administrative Agent and/or the Lenders and/or the Issuing Bank as successors to the Borrower) to be in compliance with such Environmental Laws.
(b)
The Borrower's indemnification obligations under this Section shall apply to all Indemnity Proceedings arising out of, or related to, the foregoing whether or not an Indemnified Party is a named party in such Indemnity Proceeding. In this connection, this indemnification shall cover all Indemnified Costs of any Indemnified Party in connection with any deposition of any Indemnified Party or compliance with any subpoena (including any subpoena requesting the production of documents). This indemnification shall, among other things, apply to any Indemnity Proceeding commenced by other creditors of the Borrower or any Subsidiary, any shareholder of the Borrower or any Subsidiary (whether such shareholder(s) are prosecuting such Indemnity Proceeding in their individual capacity or derivatively on behalf of the Borrower), any account debtor of the Borrower or any Subsidiary or by any Governmental Authority.
(c)
This indemnification shall apply to any Indemnity Proceeding arising during the pendency of any bankruptcy proceeding filed by or against the Borrower and/or any Subsidiary.
(d)
All out-of-pocket fees and expenses of, and all amounts paid to third-persons by, an Indemnified Party shall be advanced by the Borrower at the request of such Indemnified Party notwithstanding any claim or assertion by the Borrower that such Indemnified Party is not entitled to indemnification hereunder upon receipt of an undertaking by such Indemnified Party that such Indemnified Party will reimburse the Borrower if it is actually and finally determined by a court of competent jurisdiction that such Indemnified Party is not so entitled to indemnification hereunder. Each Indemnified Party shall use its reasonable efforts to give Borrower as much advance notice of anticipated fees, expenses and costs as is reasonably practicable under the circumstances, but failure to give such notice shall not absolve Borrower of Borrower's obligation to pay the same.
(e)
An Indemnified Party may conduct its own investigation and defense of, and may formulate its own strategy with respect to, any Indemnity Proceeding covered by this Section and, as provided above, all Indemnified Costs incurred by such Indemnified Party shall be reimbursed by the Borrower. No action taken by legal counsel chosen by an Indemnified Party in investigating or defending against any such Indemnity Proceeding shall vitiate or in any way impair the obligations and duties of the Borrower hereunder to indemnify and hold harmless each such Indemnified Party; provided, however, that (i) if the Borrower is required to indemnify an Indemnified Party pursuant hereto and (ii) the Borrower has provided evidence reasonably satisfactory to such Indemnified Party that the Borrower has the financial wherewithal to reimburse such Indemnified Party for any amount paid by such Indemnified Party with respect to such Indemnity Proceeding, such Indemnified Party shall not settle or compromise any such Indemnity Proceeding without the prior written consent of the Borrower (which consent shall not be unreasonably withheld or delayed). Notwithstanding the foregoing, an Indemnified Party may settle or compromise any such Indemnity Proceeding without the prior written consent of the Borrower
where (x) no monetary relief is sought against such Indemnified Party in such Indemnity Proceeding or (y) there is an allegation of a violation of law by such Indemnified Party.
(f)
If and to the extent that the obligations of the Borrower hereunder are unenforceable for any reason, the Borrower hereby agrees to make the maximum contribution to the payment and satisfaction of such obligations which is permissible under Applicable Law.
(g)
Subject to the immediately following Section 13.11., the Borrower's obligations hereunder shall survive any termination of this Agreement and the other Loan Documents and the payment in full in cash of the Obligations, and are in addition to, and not in substitution of, any of the other obligations set forth in this Agreement or any other Loan Document to which it is a party.
References in this Section 13.10. to “Lender” or “Lenders” shall be deemed to include such Persons (and their Affiliates) in their capacity as Specified Derivatives Providers.
Section 13.11.
Termination; Survival.
At such time as (a) all of the Commitments have been terminated, (b) all Letters of Credit have terminated or expired or been cancelled, (c) none of the Lenders is obligated any longer under this Agreement to make any Loans and no Issuing Bank is obligated any longer under this Agreement to issue Letters of Credit and (d) all Obligations (other than obligations which survive as provided in the following sentence) have been paid and satisfied in full, this Agreement shall terminate. The indemnities to which the Administrative Agent, the Issuing Bank and the Lenders are entitled under the provisions of Sections 3.10., 5.1., 5.4., 12.8., 13.2. and 13.10. and any other provision of this Agreement and the other Loan Documents, and the provisions of Section 13.5., shall continue in full force and effect and shall protect the Administrative Agent, the Issuing Bank and the Lenders (i) notwithstanding any termination of this Agreement, or of the other Loan Documents, against events arising after such termination as well as before and (ii) at all times after any such party ceases to be a party to this Agreement with respect to all matters and events existing on or prior to the date such party ceased to be a party to this Agreement.
Section 13.12.
Severability of Provisions.
If any provision under this Agreement or the other Loan Documents shall be determined by a court of competent jurisdiction to be invalid or unenforceable, that provision shall be deemed severed from the Loan Documents, and the validity, legality and enforceability of the remaining provisions shall remain in full force as though the invalid, illegal, or unenforceable provision had never been part of the Loan Documents.
Section 13.13.
GOVERNING LAW.
THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO CONTRACTS EXECUTED, AND TO BE FULLY PERFORMED, IN SUCH STATE.
Section 13.14.
Counterparts.
To facilitate execution, this Agreement and any amendments, waivers, consents or supplements may be executed in any number of counterparts as may be convenient or required (which may be effectively delivered by facsimile, in portable document format (“PDF”) or other similar electronic means). It shall not be necessary that the signature of, or on behalf of, each party, or that the signature of
all persons required to bind any party, appear on each counterpart. All counterparts shall collectively constitute a single document. It shall not be necessary in making proof of this document to produce or account for more than a single counterpart containing the respective signatures of, or on behalf of, each of the parties hereto.
Section 13.15.
Obligations with Respect to Loan Parties.
The obligations of the Borrower to direct or prohibit the taking of certain actions by the Parent or the other Loan Parties as specified herein shall be absolute and not subject to any defense the Borrower may have that the Borrower does not control the Parent or such Loan Parties.
Section 13.16.
Independence of Covenants.
All covenants hereunder shall be given in any jurisdiction independent effect so that if a particular action or condition is not permitted by any of such covenants, the fact that it would be permitted by an exception to, or be otherwise within the limitations of, another covenant shall not avoid the occurrence of a Default or an Event of Default if such action is taken or condition exists.
Section 13.17.
Limitation of Liability.
None of the Administrative Agent, the Issuing Bank or any Lender, or any affiliate, officer, director, employee, attorney, or agent of the Administrative Agent, the Issuing Bank or any Lender shall have any liability with respect to, and the Borrower and the Parent hereby waive, release, and agree not to sue any of them upon, any claim for any special, indirect, incidental, or consequential damages suffered or incurred by the Borrower or the Parent in connection with, arising out of, or in any way related to, this Agreement, any of the other Loan Documents or the Fee Letter, or any of the transactions contemplated by this Agreement or any of the other Loan Documents. The Borrower and the Parent hereby waive, release, and agree not to sue the Administrative Agent, the Issuing Bank or any Lender or any of the Administrative Agent's, the Issuing Bank's or any Lender's affiliates, officers, directors, employees, attorneys, or agents for punitive damages in respect of any claim in connection with, arising out of, or in any way related to, this Agreement, any of the other Loan Documents, the Fee Letter, or any of the transactions contemplated by this Agreement or financed hereby.
Section 13.18.
Entire Agreement.
This Agreement, the Notes, the other Loan Documents and the Fee Letter embody the final, entire agreement among the parties hereto and supersede any and all prior commitments, agreements, representations, and understandings, whether written or oral, relating to the subject matter hereof and thereof and may not be contradicted or varied by evidence of prior, contemporaneous, or subsequent oral agreements or discussions of the parties hereto. There are no oral agreements among the parties hereto.
Section 13.19.
Construction, Conflict of Terms.
The Administrative Agent, the Issuing Bank, the Borrower, the Parent and each Lender acknowledge that each of them has had the benefit of legal counsel of its own choice and has been afforded an opportunity to review this Agreement and the other Loan Documents with its legal counsel and that this Agreement and the other Loan Documents shall be construed as if jointly drafted by the Administrative Agent, the Issuing Bank, the Borrower, each Lender and the Parent. In the event of a conflict between the terms and provisions of this Agreement and the terms and provisions of any of the other Loan Documents, the terms of this Agreement shall govern.
Section 13.20.
Headings.
The paragraph and section headings in this Agreement are provided for convenience of reference only and shall not affect its construction or interpretation.
Section 13.21.
Limitation of Liability of Borrower's General Partner.
Subject to the exceptions and qualifications described below, the General Partner, shall not be personally liable for the payment of the Obligations. Notwithstanding the foregoing: (a) if an Event of Default occurs, nothing contained herein shall in any way prevent or hinder the Administrative Agent or the Lenders in the pursuit or enforcement of any right, remedy or judgment against the Borrower or any other Loan Party, or any of their respective assets; and (b) the General Partner shall be fully liable to the Administrative Agent and the Lenders to the same extent that the General Partner would be liable absent the foregoing provisions of this Section for fraud or willful misrepresentation by the Borrower, the General Partner, its or their Affiliates or predecessor general partner (
i.e.
, the Parent), (to the full extent of losses suffered by the Administrative Agent or any Lender by reason of such fraud or willful misrepresentations).
Section 13.22.
Limited Nature of Parent's Obligations.
THE LENDERS AND THE ADMINISTRATIVE AGENT ACKNOWLEDGE AND AGREE THAT THE PARENT IS JOINING IN THE EXECUTION OF THIS AGREEMENT SOLELY FOR THE LIMITED PURPOSE OF BEING BOUND BY THE TERMS OF THE SECTIONS SPECIFICALLY APPLICABLE TO THE PARENT, INCLUDING SECTIONS 8.1., 8.2., 8.6, 8.7., 8.12., 8.13., 9.6., 10.1., 10.4., 10.6., and 10.7. OF THIS AGREEMENT. THE PARTIES HERETO ACKNOWLEDGE AND AGREE THAT THE OCCURRENCE OF ANY DEFAULT OR EVENT OF DEFAULT UNDER THIS AGREEMENT OR OTHER LOAN DOCUMENT RESULTING FROM A BREACH BY THE PARENT OF, OR A MISREPRESENTATION BY THE PARENT UNDER OR IN ANY WAY RELATING TO, ANY OF SUCH SECTIONS SHALL NOT CREATE ANY PERSONAL LIABILITY ON THE PART OF THE PARENT FOR THE PAYMENT OF THE OBLIGATIONS. NOTHING CONTAINED IN THIS SECTION IS INTENDED TO LIMIT THE OBLIGATIONS OF THE PARENT UNDER THE PARENT GUARANTY.
Section 13.23.
Limitation of Liability of Borrower's Directors, Officers, Etc.
The parties hereto acknowledge and agree that no director, officer, shareholder, employee or agent of the Borrower or any Affiliate of the Borrower shall be held to any personal liability, jointly or severally, for any obligation of, or claim against, the Borrower.
Section 13.24.
AMENDMENT, RESTATEMENT AND CONSOLIDATION; NO NOVATION.
THE EXISTING CREDIT AGREEMENT IS BEING AMENDED, RESTATED AND CONSOLIDATED IN ITS ENTIRETY BY THIS AGREEMENT FOR THE CONVENIENCE OF THE PARTIES. THIS AGREEMENT MERELY AMENDS, MODIFIES, RESTATES AND CONSOLIDATES THE INDEBTEDNESS, LIABILITIES AND OBLIGATIONS EVIDENCED BY THE EXISTING CREDIT AGREEMENT AND THE OTHER LOAN DOCUMENTS (AS DEFINED IN THE EXISTING CREDIT AGREEMENT) AND DOES NOT CONSTITUTE, AND IT IS THE EXPRESS INTENT OF THE PARTIES HERETO THAT THIS AGREEMENT DOES NOT EFFECT, A NOVATION OF THE EXISTING INDEBTEDNESS, LIABILITIES AND OBLIGATIONS OWING BY
THE BORROWER PURSUANT TO THE EXISTING CREDIT AGREEMENT. ALL SUCH INDEBTEDNESS, LIABILITIES AND OBLIGATIONS CONTINUE TO REMAIN OUTSTANDING AND EVIDENCED BY THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS. THE AMENDMENT, RESTATEMENT AND CONSOLIDATION EFFECTED HEREBY SHALL BE DEEMED TO HAVE PROSPECTIVE APPLICATION ONLY FROM AND AFTER THE EFFECTIVE DATE, UNLESS OTHERWISE EXPRESSLY STATED HEREIN.
IN WITNESS WHEREOF, the parties hereto have caused this Third Amended and Restated Credit Agreement to be executed by their authorized officers all as of the day and year first above written.
BORROWER:
CBL & ASSOCIATES LIMITED PARTNERSHIP
By: CBL Holdings I, Inc., its sole general partner
|
|
|
|
By:
|
/s/ Farzana K. Mitchell
|
|
Name:
|
Farzana K. Mitchell
|
|
Title:
|
Executive Vice President - Finance and CFO
|
PARENT:
CBL & ASSOCIATES PROPERTIES, INC., solely for
the limited purposes set forth in Section 13.22.
|
|
|
|
By:
|
/s/ Farzana K. Mitchell
|
|
Name:
|
Farzana K. Mitchell
|
|
Title:
|
Executive Vice President - Finance and CFO
|
[
Signatures Continued on Next Page
]
[
Signature Page to Third Amended and Restated Credit Agreement
]
WELLS FARGO BANK, NATIONAL ASSOCIATION,
as Administrative Agent and as a Lender
|
|
|
|
By:
|
/s/ Sam Supple
|
|
Name:
|
Sam Supple
|
|
Title:
|
Senior Vice President
|
[
Signatures Continued on Following Page
]
[
Signature Page to Third Amended and Restated Credit Agreement
]
U.S. BANK NATIONAL ASSOCIATION,
as Syndication Agent and as a Lender
|
|
|
|
By:
|
/s/ Michael Raarup
|
|
Name:
|
Michael Raarup
|
|
Title:
|
Senior Vice President
|
[
Signatures Continued on Following Page
]
[
Signature Page to Third Amended and Restated Credit Agreement
]
BANK OF AMERICA, N.A.,
as a Documentation Agent and as a Lender
|
|
|
|
By:
|
/s/ Lissette Rivera-Pauley
|
|
Name:
|
Lissette Rivera-Pauley
|
|
Title:
|
Senior Vice President
|
[
Signatures Continued on Following Page
]
[
Signature Page to Third Amended and Restated Credit Agreement
]
KEYBANK NATIONAL ASSOCIATION,
as a Documentation Agent and as a Lender
|
|
|
|
By:
|
/s/ Michael P. Szuba
|
|
Name:
|
Michael P. Szuba
|
|
Title:
|
Vice President
|
[
Signatures Continued on Following Page
]
[
Signature Page to Third Amended and Restated Credit Agreement
]
JPMORGAN CHASE BANK, N.A.,
as a Documentation Agent and as a Lender
|
|
|
|
By:
|
/s/ Elizabeth R. Johnson
|
|
Name:
|
Elizabeth R. Johnson
|
|
Title:
|
Senior Credit Banker
|
[
Signatures Continued on Following Page
]
[
Signature Page to Third Amended and Restated Credit Agreement
]
PNC BANK, NATIONAL ASSOCIATION,
as a Documentation Agent and as a Lender
|
|
|
|
By:
|
/s/ Andrew T. White
|
|
Name:
|
Andrew T. White
|
|
Title:
|
Senior Vice President
|
[
Signatures Continued on Following Page
]
[
Signature Page to Third Amended and Restated Credit Agreement
]
REGIONS BANK,
as a Lender
|
|
|
|
By:
|
/s/ Lori Chambers
|
|
Name:
|
Lori Chambers
|
|
Title:
|
Vice President
|
[
Signatures Continued on Following Page
]
[
Signature Page to Third Amended and Restated Credit Agreement
]
ROYAL BANK OF CANADA,
as a Lender
|
|
|
|
By:
|
/s/ Brian Gross
|
|
Name:
|
Brian Gross
|
|
Title:
|
Authorized Signatory
|
[
Signatures Continued on Following Page
]
[
Signature Page to Third Amended and Restated Credit Agreement
]
UNION BANK, N.A.,
as a Lender
|
|
|
|
By:
|
/s/ Mark Dunn
|
|
Name:
|
Mark Dunn
|
|
Title:
|
Vice President
|
[
Signatures Continued on Following Page
]
[
Signature Page to Third Amended and Restated Credit Agreement
]
BRANCH BANKING AND TRUST COMPANY,
as a Lender
|
|
|
|
By:
|
/s/ Ahaz A. Armstrong
|
|
Name:
|
Ahaz A. Armstrong
|
|
Title:
|
Assistant Vice President
|
[
Signatures Continued on Following Page
]
[
Signature Page to Third Amended and Restated Credit Agreement
]
FIFTH THIRD BANK,
as a Lender
|
|
|
|
By:
|
/s/ John H. Reynolds
|
|
Name:
|
John H. Reynolds
|
|
Title:
|
Vice President
|
[
Signatures Continued on Following Page
]
[
Signature Page to Third Amended and Restated Credit Agreement
]
RAYMOND JAMES BANK, N.A.,
as a Lender
|
|
|
|
By:
|
/s/ James M. Armstrong
|
|
Name:
|
James M. Armstrong
|
|
Title:
|
Senior Vice President
|
[
Signatures Continued on Following Page
]
[
Signature Page to Third Amended and Restated Credit Agreement
]
MIDFIRST BANK,
as a Lender
|
|
|
|
By:
|
/s/ Darrin Rigler
|
|
Name:
|
Darrin Rigler
|
|
Title:
|
Vice President
|
[
End of
Signatures
]
SCHEDULE I
Commitments
|
|
|
Lender
|
Commitment
|
|
|
Wells Fargo Bank, National Association
|
$125,000,000
|
|
|
U.S. Bank National Association
|
$105,000,000
|
|
|
Bank of America, N.A.
|
$75,000,000
|
|
|
KeyBank National Association
|
$60,000,000
|
|
|
JPMorgan Chase Bank, N.A.
|
$50,000,000
|
|
|
PNC Bank, National Association
|
$50,000,000
|
|
|
Regions Bank
|
$30,000,000
|
|
|
Royal Bank of Canada
|
$25,000,000
|
|
|
Union Bank, N.A.
|
$25,000,000
|
|
|
Branch Banking and Trust Company
|
$20,000,000
|
|
|
Fifth Third Bank
|
$17,500,000
|
|
|
Raymond James Bank, N.A.
|
$10,000,000
|
|
|
MidFirst Bank
|
$7,500,000
|
SCHEDULE 1.1
Permitted Liens
|
|
•
|
Liens on the Borrower's Property known as Foothills Mall and related assets, and cash collateral delivered in substitution therefor, which Liens secure the Borrower's obligations under that certain Loan Agreement (Letter of Credit Facility), entered into December 19, 2001, by and among Regions Bank, Borrower, Parent, and certain subsidiaries of Borrower (as amended or otherwise modified from time to time, the “Regions LC Facility”), solely to the extent the aggregate obligations (contingent or otherwise) under the Regions LC Facility do not currently and shall not exceed $13,000,000.00.
|
SCHEDULE 7.1.(b)
Ownership Structure
SCHEDULE 7.1.(b) - PART I
Loan Parties, Limited Subsidiaries and Equity Interests
* Entities shown in bold are Guarantors
CBL & Associates Properties, Inc. (Delaware)
CBL & Associates Limited Partnership (Delaware)
CBL Holdings I, Inc. (Delaware) - 1% general partnership interest
CBL & Associates Properties, Inc. - 100% common stock
CBL Holdings II, Inc. (Delaware) - 83% limited partnership interest
CBL & Associates Properties, Inc. - 100% common stock
Other Limited Partners - 16% limited partnership interest
Acadiana Expansion Parcel, LLC (Louisiana)
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
Acadiana Mall of Delaware, LLC (Delaware)
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
Alamance Crossing, LLC (North Carolina)
CBL & Associates Limited Partnership - 100% membership interest
Bonita Lakes Mall Limited Partnership (Mississippi)
CBL/GP III, Inc. (Mississippi) - 1% general partnership interest
CBL & Associates Management, Inc. (Delaware) - 100% common stock
CBL & Associates Limited Partnership (Delaware) - 99% limited partnership interest
CBL/Low Limited Partnership (Wyoming)
CBL/GP, Inc. (Wyoming) - 1% general partnership interest
CBL & Associates Management, Inc. (Delaware) - 100% common stock
CBL & Associates Limited Partnership (Delaware) - 99% limited partnership interest
Brookfield Square Parcel, LLC (Wisconsin)
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
Akron Mall Land, LLC (Delaware)
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
Columbia Place/Anchor, LLC (South Carolina)
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
The Courtyard at Hickory Hollow Limited Partnership (Delaware)
Hickory Hollow Courtyard, Inc. (Delaware) - 1% general partnership interest
CBL & Associates Limited Partnership (Delaware) - 99% limited partnership interest
Eastgate Company (Ohio)
CBL/Eastgate I, LLC (Delaware) - 53.8475% general partnership interest
CBL/J II, LLC (Delaware) - 100% membership interest
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
CBL/Eastgate II, LLC (Delaware) - 46.1525% general partnership interest
CBL/J II, LLC (Delaware) - 100% membership interest
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
CBL/Eastgate I, LLC (Delaware)
CBL/J II, LLC (Delaware) - 100% membership interest
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
CBL/Eastgate II, LLC (Delaware)
CBL/J II, LLC (Delaware) - 100% membership interest
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
CBL/J II, LLC (Delaware)
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
FHM Anchor, LLC (Tennessee)
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
Frontier Mall Associates Limited Partnership (Wyoming)
CBL & Associates Limited Partnership (Delaware) - 99.9% general partnership interest
CBL & Associates Properties, Inc. (Delaware) - .1% limited partnership interest
Georgia Square Partnership (Georgia)
CBL & Associates Limited Partnership (Delaware) - 99.9% general partnership interest
CBL & Associates Properties, Inc. (Delaware) - .1% limited partnership interest
Georgia Square Associates, Ltd. (Georgia)
CBL & Associates Limited Partnership (Delaware) - 99.9% general partnership interest
CBL & Associates Properties, Inc. (Delaware) - .1% limited partnership interest
Harford Mall Business Trust (Maryland)
CBL/Nashua Limited Partnership (New Hampshire) - 100% ownership interest
CBL & Associates Limited Partnership (Delaware) - 99.9209% general partnership interest
CBL & Associates Properties, Inc. (Delaware) - .0791% limited partnership interest
CBL/Nashua Limited Partnership (New Hampshire)
CBL & Associates Limited Partnership (Delaware) - 99.9209% general partnership interest
CBL & Associates Properties, Inc. (Delaware) - .0791% limited partnership interest
Lakeshore/Sebring Limited Partnership (Florida)
CBL & Associates Limited Partnership (Delaware) - 99.9% general partnership interest
CBL & Associates Properties, Inc. (Delaware) - .1% limited partnership interest
Madison Plaza Associates, LTD (Alabama)
CBL & Associates Limited Partnership (Delaware) - 75% general partnership interest
CBL & Associates Limited Partnership (Delaware) - 24.9% limited partnership interest
CBL/Huntsville, LLC (Delaware) - .1% limited partnership interest
CBL & Associates Limited Partnership - 100% membership interest
Madison Square Associates, Ltd. (Alabama)
CBL & Associates Limited Partnership (Delaware) - 49.9% general partnership interest
CBL & Associates Limited Partnership (Delaware) - 50% limited partnership interest
CBL/Huntsville, LLC (Delaware) - .1% limited partnership interest
CBL & Associates Limited Partnership - 100% membership interest
CBL/Huntsville, LLC (Delaware)
CBL & Associates Limited Partnership - 100% membership interest
Meridian Mall Limited Partnership (Michigan)
Meridian Mall Company, Inc. (Michigan) - 1% general partnership interest
CBL & Associates Management, Inc. (Delaware) - 100% common stock
CBL & Associates Limited Partnership (Delaware) - 99% limited partnership interest
CBL/ Monroeville Partner, L.P. (Pennsylvania)
CBL/Monroeville II, LLC (Pennsylvania) - .5% general partnership interest
CBL & Associates Limited Partnership - 100% membership interest
CBL/Monroeville III, LLC (Pennsylvania) - 99.5% limited partnership interest
CBL & Associates Limited Partnership - 100% membership interest
CBL/Monroeville II, LLC (Pennsylvania)
CBL & Associates Limited Partnership - 100% membership interest
CBL/Monroeville III, LLC (Pennsylvania)
CBL & Associates Limited Partnership - 100% membership interest
CBL/Monroeville, L.P. (Pennsylvania)
CBL/Monroeville I, LLC (Delaware) - .5% general partnership interest
CBL & Associates Limited Partnership - 100% membership interest
CBL/ Monroeville Partner, L.P. (Pennsylvania) - 99.5% limited partnership interest
CBL/Monroeville II, LLC (Pennsylvania) - .5% general partnership interest
CBL & Associates Limited Partnership - 100% membership interest
CBL/Monroeville III, LLC (Pennsylvania) - 99.5% limited partnership interest
CBL & Associates Limited Partnership - 100% membership interest
CBL/Monroeville I, LLC (Delaware)
CBL & Associates Limited Partnership - 100% membership interest
Monroeville Anchor Limited Partnership (Pennsylvania)
CBL/Monroeville II, LLC (Pennsylvania) - .5% general partnership interest
CBL & Associates Limited Partnership - 100% membership interest
CBL/Monroeville III, LLC (Pennsylvania) - 99.5% limited partnership interest
CBL & Associates Limited Partnership - 100% membership interest
Hixson Mall, LLC (Tennessee)
CBL & Associates Limited Partnership - 100% membership interest
Old Hickory Mall Venture II, LLC (Delaware)
Old Hickory Mall Venture (Tennessee) - 99.5% membership interest
CBL/Old Hickory I, LLC (Delaware) - 95% general partnership interest
CBL/J II, LLC (Delaware) - 100% membership interest
CBL & Associates Limited Partnership - 100% membership interest
CBL/Old Hickory II, LLC (Delaware) - 5% general partnership interest
CBL/J II, LLC (Delaware) - 100% membership interest
CBL & Associates Limited Partnership - 100% membership interest
CBL Old Hickory Mall, Inc. (Tennessee) - .5% membership interest
Old Hickory Mall Venture (Tennessee)
CBL/Old Hickory I, LLC (Delaware) - 95% general partnership interest
CBL/J II, LLC (Delaware) - 100% membership interest
CBL & Associates Limited Partnership - 100% membership interest
CBL/Old Hickory II, LLC (Delaware) - 5% general partnership interest
CBL/J II, LLC (Delaware) - 100% membership interest
CBL & Associates Limited Partnership - 100% membership interest
CBL/Old Hickory I, LLC (Delaware)
CBL/J II, LLC (Delaware) - 100% membership interest
CBL & Associates Limited Partnership - 100% membership interest
CBL/Old Hickory II, LLC (Delaware)
CBL/J II, LLC (Delaware) - 100% membership interest
CBL & Associates Limited Partnership - 100% membership interest
Panama City Mall, LLC (Delaware)
CBL & Associates Limited Partnership - 100% membership interest
Willowbrook Plaza Limited Partnership (Maine)
CBL/GP, Inc. (Wyoming) - 1% general partnership interest
CBL & Associates Management, Inc. (Delaware) - 100% common stock
CBL & Associates Limited Partnership (Delaware) - 99% limited partnership interest
Port Orange Holdings II, LLC (Florida)
The Pavilion at Port Orange, LLC (Florida) - 100% membership interest
CBL & Associates Limited Partnership (Delaware) - 91.09% membership interest
CBL & Associates Management, Inc. (Delaware) - 9.91 % membership interest
College Station Partners, Ltd. (Texas)
CBL & Associates Limited Partnership (Delaware) - 99.9% membership interest
CBL & Associates Properties, Inc. (Delaware) - .1% membership interest
POM-College Station, LLC (Texas)
CBL & Associates Limited Partnership (Delaware) - 99.9% membership interest
CBL & Associates Properties, Inc. (Delaware) - .1% membership interest
JG Randolph II, LLC (Delaware)
JG Randolph, LLC (Ohio) - 100% membership interest
CBL/J II, LLC (Delaware) - 100% membership interest
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
JG Randolph, LLC (Ohio)
CBL/J II, LLC (Delaware) - 100% membership interest
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
Racine Joint Venture II, LLC (Delaware)
Racine Joint Venture (Ohio) - (100% membership interest)
CBL/Regency I, LLC (Delaware) - 74.1% general partnership interest
CBL/J II, LLC (Delaware) - 100% membership interest
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
CBL/Regency II, LLC (Delaware) - 25.9% general partnership interest
CBL/J II, LLC (Delaware) - 100% membership interest
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
Racine Joint Venture (Ohio)
CBL/Regency I, LLC (Delaware) - 74.1% general partnership interest
CBL/J II, LLC (Delaware) - 100% membership interest
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
CBL/Regency II, LLC (Delaware) - 25.9% general partnership interest
CBL/J II, LLC (Delaware) - 100% membership interest
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
CBL/Regency I, LLC (Delaware)
CBL/J II, LLC (Delaware) - 100% membership interest
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
CBL/Regency II, LLC (Delaware)
CBL/J II, LLC (Delaware) - 100% membership interest
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
CBL RM-Waco, LLC (Texas)
CBL/Richland G.P., LLC (Texas) - .5% membership interest
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
CBL & Associates Limited Partnership (Delaware) - 99.5% membership interest
CBL/Richland G.P., LLC (Texas)
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
River Ridge Mall, LLC (Virginia)
Seacoast Shopping Center Limited Partnership (New Hampshire) - 100% membership interest
CBL & Associates Limited Partnership (Delaware) - 99.92% general partnership interest
CBL & Associates Properties, Inc. (Delaware) - .08% limited partnership interest
Seacoast Shopping Center Limited Partnership (New Hampshire)
CBL & Associates Limited Partnership (Delaware) - 99.92% general partnership interest
CBL & Associates Properties, Inc. (Delaware) - .08% limited partnership interest
Rivergate Mall Limited Partnership (Delaware)
Rivergate Mall, Inc. (Delaware) - 1% general partnership interest
CBL & Associates Limited Partnership (Delaware) - 99% limited partnership interest
The Village at Rivergate Limited Partnership (Delaware)
The Village at Rivergate, Inc. (Delaware) - 1% general partnership interest
CBL & Associates Limited Partnership (Delaware) - 99% limited partnership interest
Hickory Point-OP Outparcel, LLC (Illinois)
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
The Shoppes at Panama City, LLC (Florida)
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
CBL SM-Brownsville, LLC (Texas)
CBL/Sunrise GP, LLC (Delaware) - .5% membership interest
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
CBL & Associates Limited Partnership (Delaware) - 99.5% membership interest
CBL/Sunrise GP, LLC (Delaware)
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
CBL/Sunrise Commons, L.P. (Texas)
CBL/Sunrise Commons GP, LLC (Texas) - .5% general partnership interest
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
CBL & Associates Limited Partnership (Delaware) - 99.5% limited partnership interest
CBL/Sunrise Commons GP, LLC (Texas)
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
CBL/Sunrise XS Land, L.P. (Texas)
CBL/Sunrise Land, LLC (Texas) - .5% general partnership interest
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
CBL & Associates Limited Partnership (Delaware) - 99.5% limited partnership interest
CBL/Sunrise Land, LLC (Texas)
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
CBL/Monroeville Expansion, L.P. (Pennsylvania)
CBL/Monroeville Expansion I, LLC (Pennsylvania) - .5% general partnership interest
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
CBL/Monroeville Expansion Partner, L.P. (Pennsylvania) - 99.5% limited partnership interest
CBL/Monroeville Expansion II, LLC (Pennsylvania) - .5% general partnership interest
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
CBL/Monroeville Expansion III, LLC (Pennsylvania) - 99.5% limited partnership interest
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
CBL/Monroeville Expansion I, LLC (Pennsylvania)
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
CBL/Monroeville Expansion Partner, L.P. (Pennsylvania)
CBL/Monroeville Expansion II, LLC (Pennsylvania) - .5% general partnership interest
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
CBL/Monroeville Expansion III, LLC (Pennsylvania) - 99.5% limited partnership interest
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
CBL/Monroeville Expansion II, LLC (Pennsylvania)
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
CBL/Monroeville Expansion III, LLC (Pennsylvania)
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
The Landing at Arbor Place II, LLC (Delaware)
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
Turtle Creek Limited Partnership (Mississippi)
CBL & Associates Limited Partnership (Delaware) - 99.9% general partnership interest
CBL & Associates Properties, Inc. (Delaware) - .1% limited partnership interest
CBL Walden Park, LLC (Texas)
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
WNC Shopping Center, LLC (North Carolina)
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
Madison Joint Venture (Ohio)
CBL/Madison I, LLC (Delaware) - 65% general partnership interest
CBL/J I, LLC (Delaware) - 100% membership interest
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
CBL/Madison II, LLC (Delaware) - 35% general partnership interest
CBL/J I, LLC (Delaware) - 100% membership interest
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
CBL/Madison I, LLC (Delaware)
CBL/J I, LLC (Delaware) - 100% membership interest
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
CBL/Madison II, LLC (Delaware)
CBL/J I, LLC (Delaware) - 100% membership interest
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
CBL/J I, LLC (Delaware)
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
Westgate Crossing Limited Partnership (South Carolina)
CBL/GP II, Inc. (Wyoming) - 1% general partnership interest
CBL & Associates Management, Inc. (Delaware) - 100% common stock
CBL & Associates Limited Partnership - 99% limited partnership interest
Houston Willowbrook, LLC (Texas)
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
CBL El Paso Member, LLC (Delaware)
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
Parkdale Mall, LLC (Texas)
CBL/Parkdale Mall GP, LLC (Delaware) - .05% membership interest
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
Parkdale Mall Associates, L.P. (Texas) - 99.95 % membership interest
CBL/Parkdale, LLC (Texas) - .05% general partnership interest
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
CBL & Associates Limited Partnership (Delaware) - 99.95% limited partnership interest
CBL/Parkdale Mall GP, LLC
(Delaware)
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
Parkdale Mall Associates, L.P. (Texas)
CBL/Parkdale, LLC (Texas) - .05% general partnership interest
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
CBL & Associates Limited Partnership (Delaware) - 99.95% limited partnership interest
CBL/Parkdale, LLC (Texas)
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
IV Commons, LLC (California)
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
Jefferson Mall Company II, LLC (Delaware)
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
Pearland-OP Parcel 8, LLC (Texas)
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
Southpark Mall-DSG, LLC (Virginia)
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
CBL Gettysburg Member, LLC (Delaware)
CBL & Associates Limited Partnership - 100% membership interest
CBL-TRS Member I, LLC (Delaware)
CBL & Associates Limited Partnership - 100% membership interest
CBL/MSC, LLC
(South Carolina)
CBL & Associates Limited Partnership - 100% membership interest
CBL/Gulf Coast, LLC (Florida)
CBL & Associates Limited Partnership - 100% membership interest
Laurel Park Retail Properties, LLC (Delaware)
Laurel Park Retail Holdings, LLC (Delaware) - 100% membership interest
CBL & Associates Limited Partnership - 70% membership interest
Shostak Laurel Park Retail Holding LLC - 30% membership interest
SCHEDULE 7.1.(b) - PART II
Non-Loan Party Borrower Affiliates Owning
Assets Included in Unencumbered Asset Value
Non-Guarantor Wholly Owned Subsidiaries
CBL & Associates Management, Inc.
, a Delaware corporation
CBL & Associates Limited Partnership - 100% ownership interest
CBL Sunday Drive, LLC
, a North Carolina limited liability company
CBL & Associates Management, Inc. - 100% membership interest
CBL 840 GC, LLC
, a Virginia limited liability company
CBL & Associates Management, Inc. - 100% membership interest
CBL 850 GC, LLC
, a Virginia limited liability company
CBL & Associates Management, Inc. - 100% membership interest
CVPC Outparcels, LLC
, a Florida limited liability company
CBL & Associates Management, Inc. - 100% membership interest
Hickory Point Outparcels, LLC
, an Illinois limited liability company
CBL & Associates Management, Inc. - 100% membership interest
CBL-LP Office Building, LLC
, a North Carolina limited liability company
CBL & Associates Management, Inc. - 100% membership interest
CBL-OB Business Center, LLC
, a North Carolina limited liability company
CBL & Associates Management, Inc. - 100% membership interest
CBL One Oyster Point, LLC
, a Virginia limited liability company
CBL & Associates Management, Inc. - 100% membership interest
Pearland Hotel Operator, Inc.
, a Texas corporation
CBL & Associates Management, Inc. - 100% membership interest
CBL-PB Center I, LLC
, a Virginia limited liability company
CBL & Associates Management, Inc. - 100% membership interest
CBL-ST Building, LLC
, a North Carolina limited liability company
CBL & Associates Management, Inc. - 100% membership interest
CBL Two Oyster Point, LLC
, a Virginia limited liability company
CBL & Associates Management, Inc. - 100% membership interest
CBL Lee's Summit East, LLC
, a Delaware limited liability company
CBL & Associates Management, Inc. - 100% membership interest
Consolidated JV Entities
:
Imperial Valley Commons, L.P.
, a California limited partnership
CBL & Associates Limited Partnership - 59.5% limited partnership interest
IV Commons, LLC - .5% general partnership interest
CBL & Associates Limited Partnership - 100% membership interest
High Point Development Limited Partnership II,
a North Carolina limited partnership
CBL & Associates Limited Partnership - 74% limited partnership interest
CBL/GP, Inc. - 1% general partnership interest
Pearland Town Center Limited Partnership,
a Texas limited partnership
CBL/T-C, LLC - 99.5% limited partnership interest (JV Entity)
Pearland Town Center GP, LLC - 0.5% general partnership interest
CBL/T-C, LLC - 100% membership interest
CBL SubREIT, Inc. - 34.44% membership interest
CW Joint Venture, LLC - 85% ownership interest
CBL & Associates Limited Partnership - 55.56% membership interest
Arbor Place Limited Partnership - 12.17% membership interest
CBL & Associates Limited Partnership - 99% general partnership interest
Arbor Place GP, Inc. -
1% general partnership interest
St. Clair Square GP, Inc. - .16% membership interest
The Galleria Associates, L.P. - 20.33% membership interest
CBL & Associates Limited Partnership - 89.9% general partnership interest
CBL & Associates Properties, Inc. - .1% limited partnership interest
Oak Park Holding I, LLC - 5.54% membership interest
CBL & Associates Limited Partnership - 99.5% membership interest
CBL SubREIT, Inc. - 0.5% membership interest
OK City JV, LLC
, a Delaware limited liability company
OK City Member, LLC - 75% membership interest
CBL & Associates Limited Partnership - 92.5% membership interest
CBL & Associates Management, Inc. - 7.5% membership interest
EL Paso Outlet Center II, LLC
, a Delaware limited liability company
CBL El Paso Member, LLC - 75% membership interest
CBL & Associates Limited Partnership - 100% membership interest
EL Paso Outlet Outparcels, LLC
, a Delaware limited liability company
CBL El Paso Outparcel Member, LLC - 50% membership interest
CBL & Associates Management, Inc. - 100% membership interest
Gettysburg Outlet Center, LLC
, a Delaware limited liability company
CBL Gettysburg Member, LLC - 50% membership interest
CBL & Associates Limited Partnership - 100% membership interest
Atlanta Outlet Outparcels, LLC
, a Delaware limited liability company
CBL Woodstock Outparcel Member, LLC - 75% membership interest
CBL & Associates Limited Partnership - 75% membership interest
CBL & Associates Management, Inc. - 25% membership interest
Lebcon Associates
, a Tennessee limited partnership
CBL & Associates Limited Partnership - 89.9% general partnership interest
CBL & Associates Limited Partnership - .1% limited partnership interest
Village at Orchard Hills, LLC
, a Michigan limited liability company
CBL & Associates Limited Partnership - 66% membership interest
Beltline Properties, LLC - 34% membership interest
Unconsolidated JV Entities
:
Governor's Square Company IB
, an Ohio general partnership
Montgomery Partners, L.P. - 50% general partnership interest
CBL & Associates Limited Partnership - 99% limited partnership interest
CBL/GP VI, Inc. - 1% general partnership interest
CBL-Shops at Friendly II, LLC
, a North Carolina limited liability company
CBL-TRS Member I, LLC - 50% membership interest in CBL-TRS Joint Venture, LLC, which is the Joint Venture that owns CBL-Shops at Friendly II, LLC
CBL & Associates Limited Partnership - 100% membership interest
Mall of South Carolina Limited Partnership
, a South Carolina limited
partnership
CBL & Associates Limited Partnership - 49% limited partnership interest
CBL/MSC, LLC - 1% general partnership interest
CBL & Associates Limited Partnership - 100% membership interest
GCTC Peripheral IV, LLC,
a Florida limited liability company
CBL/Gulf Coast, LLC - 50% membership interest in JG Gulf Coast Town Center LLC, which is the Joint Venture that owns GCTC Peripheral IV, LLC
CBL & Associates Limited Partnership - 100% membership interest
SCHEDULE 7.1.(f)
Occupancy Status of Properties
SCHEDULE 7.1.(f) - PART II
Eligible Properties
Property Description
Occupancy
Property
Rate
Classification
|
|
|
|
1500 Sunday Drive
|
84.2%
|
|
840 Greenbrier Circle
|
87.0%
|
|
850 Greenbrier Circle
|
100.0%
|
|
Acadiana Expansion Land
|
|
Land
|
Alamance Outparcel
|
|
Land
|
Bonita Crossing
|
97.2%
|
|
Bonita Lakes Mall
|
91.4%
|
|
Brookfield Square Lifestyle Center
|
100.0%
|
|
Chapel Hill Asso. Center
|
100.0%
|
|
Chapel Hill Vacant Land (RET Exp)
|
|
Land
|
Cobblestone at PC Outparcels
|
|
Land
|
Columbia JCP
|
49.7%
|
|
Courtyard at Hickory
|
98.2%
|
|
Douglasville, GA Outparcels 1
|
|
Land
|
Eastgate Land
|
|
Land
|
Foothills Carmike FHM Anchor
|
100.0%
|
Development
|
Foothills Plaza Expansion
|
100.0%
|
|
Frontier Mall
|
91.1%
|
|
Frontier Square
|
100.0%
|
|
Georgia Square
|
92.9%
|
|
Georgia Square Cinema
|
100.0%
|
|
Greenbriar Out parcel
|
|
Land
|
Harford Annex
|
100.0%
|
|
Harford Mall
|
99.3%
|
|
Hickory Point Outparcel
|
|
Land
|
Honey Creek OP
|
|
Land
|
J.C. Penney Maryville
|
100.0%
|
|
Jacksonville Regal Cinema Mgt
|
|
Land
|
Jefferson Mall Outparcels
|
|
Land
|
Lake Point Office B
|
94.0%
|
|
Lakeshore Mall
|
76.9%
|
|
Lansing, MI Land
|
|
Land
|
Laural Park Mall
|
97.9%
|
|
Lees Sumitt Land (CBL Mgmt Ops)
|
|
Land
|
Madison Plaza
|
59.7%
|
|
Madison Square
|
83.6%
|
|
Meridian Mall
|
89.3%
|
|
Monroeville
|
90.8%
|
|
Monroeville Mall Anchor
|
|
Development
|
Northgate Mall
|
81.1%
|
|
|
|
|
|
Oak Branch Bus. Center
|
77.1%
|
|
Old Hickory Mall
|
94.0%
|
|
One Oyster Point
|
24.5%
|
|
Panama City Mall
|
89.9%
|
|
Pearland Hotel
|
75.6%
|
|
Pearland Outparcel
|
|
Land
|
Pearland Residential
|
93.7%
|
|
Pemberton Plaza
|
81.1%
|
|
Peninsula Bus Center I
|
91.4%
|
|
Peninsula Bus Center II
|
100.0%
|
|
Port Orange FL West (CBL Mgmt Ops)
|
|
Land
|
Post Oak Mall
|
89.2%
|
|
Randolph Mall
|
85.9%
|
|
Regency Mall
|
89.6%
|
|
Richland Mall
|
96.4%
|
|
River Ridge
|
77.5%
|
|
Rivergate Mall
|
96.9%
|
|
Settler's Ridge Phase III Mgmt
|
|
Land
|
Shopps at Eastgate Cincinnati
|
|
Development
|
Shopps At Hickory Point
|
66.7%
|
|
Southaven Out Parcel
|
|
Land
|
Southpark - Dick's Sporting Goods
|
|
Land
|
Stillwater Outparcels
|
|
Land
|
Sunrise Commons
|
100.0%
|
|
Sunrise Excess Land
|
|
Land
|
Sunrise Mall
|
93.4%
|
|
SunTrust Bank Bldg
|
95.9%
|
|
The District @ Monroeville
|
95.2%
|
|
The Lakes OP 2
|
|
Land
|
The Landing @ Arbor Place
|
75.5%
|
|
The Landing Out Parcels1
|
|
Land
|
The Shoppes @ Panama City
|
96.2%
|
|
Township Property Land
|
0.0%
|
Land
|
Turtle Creek Mall
|
94.0%
|
|
Two Oyster Point
|
79.4%
|
|
Village at Rivergate
|
95.8%
|
|
Walden Park Austin TX
|
|
Land
|
Waynesville Comm Waynesville N
|
|
Development
|
West Towne Crossing
|
100.0%
|
|
Westgate Crossing
|
56.3%
|
|
Whitehall Station
|
|
Development
|
Willowbrook Plaza
|
72.0%
|
|
Willowbrook Land Houston TX 1
|
100.0%
|
|
SCHEDULE 7.1.(h)
Material Contracts
None.
SCHEDULE 7.1.(i)
Material Litigation
None.
SCHEDULE 7.1.(r)
Affiliate Transactions
None.
Schedule 8.14(C)
Parent Guaranties
• Guaranty Agreement dated December 30, 2011, by CBL & Associates Properties, Inc. and CBL & Associates Limited Partnership, in favor of Wells Fargo Bank, National Association, as Trustee and Administrative Agent for the Bondholders under Mississippi Business Finance Corporation Revenue Refunding Bonds, Series 2011A and Series 2011B, in the cumulative amount of $58,000,000.00.
• Guaranty Agreement dated December 19, 2001, by CBL & Associates Properties, Inc., in favor of Regions Bank, as additional security for that certain Loan Agreement (Letter of Credit Facility), entered into December 19, 2001, by and among Regions Bank and CBL & Associates Limited Partnership (and certain of its subsidiaries), as such Facility has been subsequently amended; provided that the Parent and the Borrower shall use commercially reasonable efforts to amend or otherwise modify or replace such Guaranty Agreement so that on or before the 90
th
day following the Agreement Date such Guaranty Agreement (or any replacement guaranty in respect thereof) shall provide rights and benefits not greater than the rights and benefits provided to the Administrative Agent and the Lenders pursuant to the Parent Guaranty.
• Guaranty Agreement dated June 8, 2012, by CBL & Associates Properties, Inc., in favor of First Tennessee Bank National Association as Administrative Agent, and for the benefit of the Lenders of that certain Amended and Restated Loan Agreement by and among CBL & Associates Limited Partnership and First Tennessee Bank National Association as Administrative Agent for the Lenders named therein; provided that the Parent and the Borrower shall use commercially reasonable efforts to amend or otherwise modify or replace such Guaranty Agreement so that on or before the 90
th
day following the Agreement Date such Guaranty Agreement (or any replacement guaranty in respect thereof) shall provide rights and benefits not greater than the rights and benefits provided to the Administrative Agent and the Lenders pursuant to the Parent Guaranty.
EXHIBIT A
FORM OF ASSIGNMENT AND ASSUMPTION AGREEMENT
THIS ASSIGNMENT AND ASSUMPTION AGREEMENT dated as of _______, 20__ (the “Agreement”) by and among _________________________ (the “Assignor”), _________________________ (the “Assignee”), CBL & Associates Limited Partnership (the “Borrower”), and Wells Fargo BANK, NATIONAL ASSOCIATION, as Administrative Agent (the “Administrative Agent”).
WHEREAS, the Assignor is a Lender under that certain Third Amended and Restated Credit Agreement dated as of November 13, 2012 (as amended, restated, supplemented or otherwise modified from time to time, the “Credit Agreement”), by and among the Borrower, the financial institutions party thereto and their assignees under Section 13.6. thereof, the Administrative Agent, and the other parties thereto;
WHEREAS, the Assignor desires to assign to the Assignee all or a portion of the Assignor's Revolving Commitment under the Credit Agreement, all on the terms and conditions set forth herein; and
WHEREAS, the
[Borrower, the]
Swingline Lender, the Issuing Bank and the Administrative Agent consents to such assignment on the terms and conditions set forth herein.
NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which hereby are acknowledged by the parties hereto, the parties hereto hereby agree as follows:
Section 1.
Assignment
.
(a)
Subject to the terms and conditions of this Agreement and in consideration of the payment to be made by the Assignee to the Assignor pursuant to Section 2 of this Agreement, effective as of ____________, 20__ (the “Assignment Date”) the Assignor hereby irrevocably sells, transfers and assigns to the Assignee, without recourse, a $__________ interest (such interest being the “Assigned Commitment”) in and to the Assignor's Revolving Commitment, and all of the other rights and obligations of the Assignor under the Credit Agreement, such Assignor's Revolving Note, and the other Loan Documents representing ______% in respect of the aggregate amount of all Lenders' Revolving Commitments, including without limitation, a principal amount of outstanding Revolving Loans equal to $_________, all voting rights of the Assignor associated with the Assigned Commitment all rights to receive interest on such amount of Loans and all Fees with respect to the Assigned Commitment and other rights of the Assignor under the Credit Agreement and the other Loan Documents with respect to the Assigned Commitment, all as if the Assignee were an original Lender under and signatory to the Credit Agreement having a Revolving Commitment equal to the amount of the Assigned Commitment. The Assignee, subject to the terms and conditions hereof, hereby assumes all obligations of the Assignor with respect to the Assigned Commitment as if the Assignee were an original Lender under and signatory to the Credit Agreement having a Revolving Commitment equal to the Assigned Commitment, which obligations shall include, but shall not be limited to, the obligation
of the Assignor to make Revolving Loans to the Borrower with respect to the Assigned Commitment and the obligation to indemnify the Administrative Agent as provided in the Credit Agreement (the foregoing obligations, together with all other similar obligations more particularly set forth in the Credit Agreement and the other Loan Documents, shall be referred to hereinafter, collectively, as the “Assigned Obligations”). The Assignor shall have no further duties or obligations with respect to, and shall have no further interest in, the Assigned Obligations or the Assigned Commitment from and after the Assignment Date.
(b)
The assignment by the Assignor to the Assignee hereunder is without recourse to the Assignor. The Assignee makes and confirms to the Administrative Agent, the Assignor, and the other Lenders all of the representations, warranties and covenants of a Lender under Article XII of the Credit Agreement. Not in limitation of the foregoing, the Assignee acknowledges and agrees that, except as set forth in Section 4. below, the Assignor is making no representations or warranties with respect to, and the Assignee hereby releases and discharges the Assignor for any responsibility or liability for: (i) the present or future solvency or financial condition of the Borrower, any other Loan Party or any other Subsidiary, (ii) any representations, warranties, statements or information made or furnished by the Borrower, any other Loan Party or any other Subsidiary in connection with the Credit Agreement or otherwise, (iii) the validity, efficacy, sufficiency, or enforceability of the Credit Agreement, any Loan Document or any other document or instrument executed in connection therewith, or the collectibility of the Assigned Obligations, (iv) the perfection, priority or validity of any Lien with respect to any collateral at any time securing the Obligations or the Assigned Obligations under the Notes or the Credit Agreement and (v) the performance or failure to perform by the Borrower or any other Loan Party of any obligation under the Credit Agreement or any other Loan Document. Further, the Assignee acknowledges that it has, independently and without reliance upon the Administrative Agent, any other Lender or counsel to the Administrative Agent or any of their respective officers, directors, employees and agents and based on the financial statements supplied by the Borrower and such other documents and information as it has deemed appropriate, made its own credit analysis and decision to become a Lender under the Credit Agreement. The Assignee also acknowledges that it will, independently and without reliance upon the Administrative Agent or any other Lender and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit decisions in taking or not taking action under the Credit Agreement or any Note or pursuant to any other obligation. The Administrative Agent shall have no duty or responsibility whatsoever, either initially or on a continuing basis, to provide the Assignee with any credit or other information with respect to the Borrower, any other Loan Party or any other Subsidiary or to notify the undersigned of any Default or Event of Default except as expressly provided in the Credit Agreement. The Assignee has not relied on the Administrative Agent as to any legal or factual matter in connection therewith or in connection with the transactions contemplated thereunder.
Section 2.
Payment by Assignee
. In consideration of the assignment made pursuant to Section 1. of this Agreement, the Assignee agrees to pay to the Assignor on the Assignment Date
,
an amount equal to $_________ representing the aggregate principal amount outstanding of the
Revolving Loans owing to the Assignor under the Credit Agreement and the other Loan Documents being assigned hereby.
Section 3.
Payments by Assignor
. The Assignor agrees to pay to the Administrative Agent on the Assignment Date the administrative fee payable under Section 13.6.(b)(iv) of the Credit Agreement.
Section 4.
Representations and Warranties of Assignor
. The Assignor hereby represents and warrants to the Assignee that (a) as of the Assignment Date (i) the Assignor is a Lender under the Credit Agreement having a Revolving Commitment under the Credit Agreement immediately prior to the Assignment Date, equal to $____________ and that the Assignor is not in default of its obligations under the Credit Agreement; and (ii) the outstanding balance of Revolving Loans owing to the Assignor is $____________ and (b) it is the legal and beneficial owner of the Assigned Commitment which is free and clear of any adverse claim created by the Assignor.
Section 5.
Representations, Warranties and Agreements of Assignee
. The Assignee (a) represents and warrants that it is (i) legally authorized to enter into this Agreement; (ii) an “accredited investor” (as such term is used in Regulation D of the Securities Act) and (iii) an Eligible Assignee; (b) confirms that it has received a copy of the Credit Agreement, together with copies of the most recent financial statements delivered pursuant thereto and such other documents and information (including without limitation the Loan Documents) as it has deemed appropriate to make its own credit analysis and decision to enter into this Agreement; (c) appoints and authorizes the Administrative Agent to take such action as contractual representative on its behalf and to exercise such powers under the Loan Documents as are delegated to the Administrative Agent by the terms thereof together with such powers as are reasonably incidental thereto; (d) agrees that it will become a party to and shall be bound by the Credit Agreement and the other Loan Documents to which the other Lenders are a party on the Assignment Date and will perform in accordance therewith all of the obligations which are required to be performed by it as a Lender; and (e) is either (i) not organized under the laws of a jurisdiction outside the United States of America or (ii) has delivered to the Administrative Agent (with an additional copy for the Borrower) such items required under Section 3.10. of the Credit Agreement.
Section 6.
Recording and Acknowledgment by the Administrative Agent
. Following the execution of this Agreement, the Assignor will deliver to the Administrative Agent (a) a duly executed copy of this Agreement for acknowledgment and recording by the Administrative Agent and (b) the Assignor's Revolving Note. Upon such acknowledgment and recording, from and after the Assignment Date, the Administrative Agent shall make all payments in respect of the interest assigned hereby (including payments of principal, interest, fees and other amounts) to the Assignee. The Assignor and Assignee shall make all appropriate adjustments in payments under the Credit Agreement for periods prior to the Assignment Date directly between themselves.
Section 7.
Addresses
. The Assignee specifies as its address for notices and its Lending Office for all Loans, the offices set forth below:
_______________________
_______________________
Attention: ___________________
Telephone No.: _______________
Telecopy No.: ________________
Section 8.
Payment Instructions
. All payments to be made to the Assignee under this Agreement by the Assignor, and all payments to be made to the Assignee under the Credit Agreement, shall be made as provided in the Credit Agreement in accordance with the following instructions:
____________________________
____________________________
____________________________
____________________________
Section 9.
Effectiveness of Assignment
. This Agreement, and the assignment and assumption contemplated herein, shall not be effective until (a) this Agreement is executed and delivered by each of the Assignor, the Assignee, the Administrative Agent, the Swingline Lender, the Issuing Bank and if required, the Borrower, and (b) the payment to the Assignor of the amounts owing by the Assignee pursuant to Section 2. hereof and (c) the payment to the Administrative Agent of the amounts owing by the Assignor pursuant to Section 3. hereof. Upon recording and acknowledgment of this Agreement by the Administrative Agent, from and after the Assignment Date, (i) the Assignee shall be a party to the Credit Agreement and, to the extent provided in this Agreement, have the rights and obligations of a Lender thereunder and (ii) the Assignor shall, to the extent provided in this Agreement, relinquish its rights (except as otherwise provided in Section 13.11 of the Credit Agreement) and be released from its obligations under the Credit Agreement;
provided
,
however
, that if the Assignor does not assign its entire interest under the Loan Documents, it shall remain a Lender entitled to all of the benefits and subject to all of the obligations thereunder with respect to its Commitment.
Section 10.
Governing Law
. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO CONTRACTS EXECUTED, AND TO BE FULLY PERFORMED, IN SUCH STATE.
Section 11.
Counterparts
. This Agreement may be executed in any number of counterparts each of which, when taken together, shall constitute one and the same agreement.
Section 12.
Headings
. Section headings have been inserted herein for convenience only and shall not be construed to be a part hereof.
Section 13.
Amendments; Waivers
. This Agreement may not be amended, changed, waived or modified except by a writing executed by the Assignee and the Assignor.
Section 14.
Entire Agreement
. This Agreement embodies the entire agreement between the Assignor and the Assignee with respect to the subject matter hereof and supersedes all other prior arrangements and understandings relating to the subject matter hereof.
Section 15.
Binding Effect
. This Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and permitted assigns.
Section 16.
Definitions
. Terms not otherwise defined herein are used herein with the respective meanings given them in the Credit Agreement.
[Include this Section only if the Borrower's consent is required under Section 13.6.(b) of the Credit Agreement]
Section 17.
Agreements of the Borrower
. The Borrower hereby agrees that the Assignee shall be a Lender under the Credit Agreement having a Revolving Commitment equal to the Assigned Commitment. The Borrower agrees that the Assignee shall have all of the rights and remedies of a Lender under the Credit Agreement and the other Loan Documents as if the Assignee were an original Lender under and signatory to the Credit Agreement, including, but not limited to, the right of a Lender to receive payments of principal and interest with respect to the Assigned Obligations, if any, and to the Revolving Loans made by the Lenders after the date hereof and to receive the Fees payable to the Lenders as provided in the Credit Agreement. Further, the Assignee shall be entitled to the benefit of the indemnification provisions from the Borrower in favor of the Lenders as provided in the Credit Agreement and the other Loan Documents. The Borrower further agrees, upon the execution and delivery of this Agreement, to execute in favor of the Assignee a Revolving Note in an initial amount equal to the Assigned Commitment. Further, the Borrower agrees that, upon the execution and delivery of this Agreement, the Borrower shall owe the Assigned Obligations to the Assignee as if the Assignee were the Lender originally making such Loans and entering into such other obligations.
[Signatures on Following Page]
IN WITNESS WHEREOF, the parties hereto have duly executed this Assignment and Assumption Agreement as of the date and year first written above.
ASSIGNOR:
[NAME OF ASSIGNOR]
By: ________________________________
Name: ___________________________
Title: ____________________________
Payment Instructions
[Bank]
[Address]
ABA No. :
Account No.:
Account Name:
Reference:
ASSIGNEE:
[NAME OF ASSIGNEE]
By: _______________________________
Name: __________________________
Title: ___________________________
Payment Instructions
[Bank]
[Address]
ABA No. :
Account No.:
Account Name:
Reference:
[Signatures continued on Following Page]
Agreed and Consented to as of the date first written above.
[Include signature of the Borrower only if required under Section 13.6.(b) of the Credit Agreement]
BORROWER:
[NAME OF BORROWER]
By: __________________________________
Name: _____________________________
Title: ______________________________
Accepted as of the date first written above.
ADMINISTRATIVE AGENT:
WELLS FARGO BANK, NATIONAL ASSOCIATION, as Administrative Agent
By: _________________________
Name: ____________________
Title: _____________________
Accepted as of the date first written above.
SWINGLINE LENDER:
WELLS FARGO BANK, NATIONAL ASSOCIATION, as Swingline Lender
By: _________________________
Name: ____________________
Title: _____________________
Accepted as of the date first written above.
ISSUING BANK:
WELLS FARGO BANK, NATIONAL ASSOCIATION, as Issuing Bank
By: _________________________
Name: ____________________
Title: _____________________
EXHIBIT B
FORM OF AMENDED AND RESTATED GUARANTY
THIS AMENDED AND RESTATED GUARANTY (as the same may be amended, restated, supplemented or otherwise modified from time to time, this “Guaranty”) is made as of ____________ __, _____ by and among each of the Subsidiaries of CBL & Associates Limited Partnership (the “Borrower”) listed on the signature pages hereto (collectively, the “Initial Guarantors” and each an “Initial Guarantor”) and those additional Subsidiaries of the Borrower which become parties to this Guaranty by executing a supplement hereto (a “Guaranty Supplement”) in the form attached hereto as Annex I (such additional Subsidiaries, together with the Initial Guarantors, the “Guarantors”), in favor of Wells Fargo Bank, National Association, as Administrative Agent (the “Administrative Agent”), for its benefit and for the benefit of the Lenders and the Issuing Bank under the Credit Agreement described below (the Administrative Agent, the Lenders and the Issuing Bank, each individually a “Guaranteed Party” and collectively, the “Guaranteed Parties”). Unless otherwise defined herein, capitalized terms used herein and not defined herein shall have the meanings ascribed to such terms in the Credit Agreement.
W
I
T
N
E
S
S
E
T
H
:
WHEREAS, the Borrower, CBL & Associates Properties, Inc. (the “Parent”), the financial institutions party thereto from time to time (the “Existing Lenders”), and Wells Fargo Bank, National Association, as Administrative Agent (the “Existing Administrative Agent”) are party to that certain Second Amended and Restated Credit Agreement dated as of November 2, 2009 (as amended and in effect immediately prior to the date hereof, the “Existing Credit Agreement”);
WHEREAS, pursuant to the Existing Credit Agreement, certain entities entered into Guaranties in favor of the Existing Administrative Agent for the benefit of the Existing Lenders under the Existing Credit Agreement (collectively, as amended and in effect immediately prior to the date hereof, the “Existing Guaranty”);
WHEREAS, the Borrower, the Parent, each of the financial institutions initially a signatory thereto together with their successors and assignees (the “Lenders”) and the Administrative Agent have entered into that certain Third Amended and Restated Credit Agreement of even date herewith (as the same may be amended, restated, supplemented or otherwise modified from time to time, the “Credit Agreement”), which Credit Agreement provides, subject to the terms and conditions thereof, for extensions of credit and other financial accommodations to be made by the Lenders to or for the benefit of the Borrower;
WHEREAS, it is a condition precedent to the extensions of credit by the Lenders under the Credit Agreement that each of the Guarantors (constituting all of the Subsidiaries of the Borrower required to execute this Guaranty pursuant to Section 8.14. of the Credit Agreement) agree to amend and restate the Existing Guaranty in the form of this Guaranty, whereby each of the Guarantors, without limitation and with full recourse, shall guarantee the payment when due of all Obligations, including, without limitation, all principal, interest, letter of credit reimbursement obligations and other amounts that shall be at any time payable by the Borrower under the Credit Agreement or the other Loan Documents; and
WHEREAS, in consideration of the direct and indirect financial and other support and benefits that the Borrower has provided, and such direct and indirect financial and other support and benefits as the Borrower may in the future provide, to the Guarantors, and in consideration of the increased ability of each Guarantor to receive funds through contributions to capital, and for each Guarantor to receive funds through intercompany advances or otherwise, from funds provided to the Borrower pursuant to the Credit
Agreement and the flexibility provided by the Credit Agreement for each Guarantor to do so which significantly facilitates the business operations of the Borrower and each Guarantor and in order to induce the Lenders and the Administrative Agent to enter into the Credit Agreement, and to make the Loans and the other financial accommodations to the Borrower and to issue the Letters of Credit described in the Credit Agreement, each of the Guarantors is willing to guarantee the Obligations under the Credit Agreement and the other Loan Documents;
NOW, THEREFORE, in consideration of the foregoing premises and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:
SECTION 1.
Representations, Warranties and Covenants
. Each of the Guarantors represents and warrants to each Guaranteed Party and the Administrative Agent as of the date of this Guaranty, giving effect to the consummation of the transactions contemplated by the Loan Documents on the Effective Date, and thereafter on each date as required by Section 6.2. of the Credit Agreement that:
(a)
It is a corporation, partnership or other legal entity, duly organized or formed, validly existing and in good standing under the jurisdiction of its incorporation or formation, has the power and authority to own or lease its respective properties and to carry on its respective business as now being and hereafter proposed to be conducted and is duly qualified and is in good standing as a domestic or foreign corporation, partnership or other legal entity, and authorized to do business, in each jurisdiction in which the character of its properties or the nature of its business requires such qualification or authorization and where the failure to be so qualified or authorized could reasonably be expected to have, in each instance, a Material Adverse Effect.
(b)
It has the right and power, and has taken all necessary action to authorize it, to execute, deliver and perform this Guaranty in accordance with its terms and to perform its obligations hereunder. This Guaranty has been duly executed and delivered by the duly authorized officers of such Guarantor and is a legal, valid and binding obligation of such Guarantor enforceable against such Guarantor in accordance with its terms, except as the same may be limited by bankruptcy, insolvency, and other similar laws affecting the rights of creditors generally and the availability of equitable remedies for the enforcement of certain obligations contained herein and as may be limited by equitable principles generally.
(c)
The execution, delivery and performance of this Guaranty in accordance with its terms and the obligations hereunder do not and will not, by the passage of time, the giving of notice, or both: (i) require any Governmental Approval or violate any Applicable Law (including all Environmental Laws) relating to such Guarantor; (ii) conflict with, result in a breach of or constitute a default under the organizational documents of such Guarantor, or any indenture, agreement or other instrument to which such Guarantor is a party or by which it or any of its respective properties may be bound; or (iii) result in or require the creation or imposition of any Lien upon or with respect to any Property now owned or hereafter acquired by such Guarantor other than in favor of the Administrative Agent for its benefit and the benefit of the Guaranteed Parties and the Issuing Bank. It is in compliance with each Governmental Approval and all other Applicable Laws relating to it except for non-compliances which, and Governmental Approvals the failure to possess which, could not, individually or in the aggregate, reasonably be expected to cause a Default or Event of Default or have a Material Adverse Effect.
(d)
It has no Indebtedness other than Indebtedness permitted under the Credit Agreement.
In addition to the foregoing, each of the Guarantors covenants that, so long as any Guaranteed Party has any Revolving Commitment, Swingline Commitment or Letter of Credit outstanding under the
Credit Agreement or any amount payable under the Credit Agreement or any other Obligations shall remain unpaid, it will, and, if necessary, will cause the Borrower to, fully comply with those covenants and agreements of the Borrower applicable to such Guarantor set forth in the Credit Agreement.
SECTION 2.
The Guaranty
. Each of the Guarantors hereby irrevocably and unconditionally guarantees, jointly and severally with the other Guarantors, the full and punctual payment and performance when due (whether at stated maturity, upon acceleration or otherwise) of the Obligations, including, without limitation, (i) the principal of and interest on each Loan made to the Borrower pursuant to the Credit Agreement, (ii) obligations owing under or in connection with Letters of Credit, (iii) all other amounts payable by the Borrower under the Credit Agreement and the other Loan Documents, and (iv) the punctual and faithful performance, keeping, observance, and fulfillment by the Borrower of all of the agreements, conditions, covenants, and obligations of the Borrower contained in the Loan Documents (all of the foregoing being referred to collectively as the “Guaranteed Obligations”). Upon the failure by the Borrower, or any of its Affiliates, as applicable, to pay punctually any such amount or perform such obligation, subject to any applicable grace or notice and cure period, each of the Guarantors agrees that it shall forthwith on demand pay such amount or perform such obligation at the place and in the manner specified in the Credit Agreement or the relevant other Loan Document, as the case may be. Each of the Guarantors hereby agrees that this Guaranty is an absolute, irrevocable and unconditional guaranty of payment and is not a guaranty of collection.
SECTION 3.
Guaranty Unconditional
. The obligations of each of the Guarantors hereunder shall be unconditional and absolute and, without limiting the generality of the foregoing, shall not be released, discharged or otherwise affected by:
(i)
any extension, renewal, settlement, indulgence, compromise, waiver or release of or with respect to the Guaranteed Obligations or any part thereof or any agreement relating thereto, or with respect to any obligation of any other guarantor of any of the Guaranteed Obligations, whether (in any such case) by operation of law or otherwise, or any failure or omission to enforce any right, power or remedy with respect to the Guaranteed Obligations or any part thereof or any agreement relating thereto, or with respect to any obligation of any other guarantor of any of the Guaranteed Obligations;
(ii)
any modification or amendment of or supplement to the Credit Agreement or any other Loan Document, including, without limitation, any such amendment which may increase the amount of, or the interest rates applicable to, any of the Guaranteed Obligations guaranteed hereby;
(iii)
any release, surrender, compromise, settlement, waiver, subordination or modification, with or without consideration, of any other guaranties with respect to the Guaranteed Obligations or any part thereof, or any other obligation of any person or entity with respect to the Guaranteed Obligations or any part thereof;
(iv)
any change in the corporate, partnership, limited liability company or other existence, structure or ownership of the Borrower or any other guarantor of any of the Guaranteed Obligations, or any insolvency, bankruptcy, reorganization or other similar proceeding affecting the Borrower or any other guarantor of the Guaranteed Obligations, or any of their respective assets or any resulting release or discharge of any obligation of the Borrower or any other guarantor of any of the Guaranteed Obligations;
(v)
the existence of any claim, setoff or other rights which the Guarantors may have at any time against the Borrower, any other guarantor of any of the Guaranteed Obligations, the
Administrative Agent, any Guaranteed Party or any other Person, whether in connection herewith or in connection with any unrelated transactions,
provided
that nothing herein shall prevent the assertion of any such claim by separate suit or compulsory counterclaim;
(vi)
the enforceability or validity of the Guaranteed Obligations or any part thereof or the genuineness, enforceability or validity of any agreement relating thereto, or any other invalidity or unenforceability relating to or against the Borrower or any other guarantor of any of the Guaranteed Obligations, for any reason related to the Credit Agreement or any other Loan Document, or any provision of applicable law, decree, order or regulation purporting to prohibit the payment by the Borrower or any other guarantor of the Guaranteed Obligations, of any of the Guaranteed Obligations or otherwise affecting any term of any of the Guaranteed Obligations;
(vii)
the election by, or on behalf of, any one or more of the Guaranteed Parties, in any proceeding instituted under Chapter 11 of Title 11 of the United States Code (11 U.S.C. 101 et seq.) (or any successor statute, the “
Bankruptcy Code
”), of the application of Section 1111(b)(2) of the Bankruptcy Code;
(viii)
any borrowing or grant of a security interest by the Borrower, as debtor-in-possession, under Section 364 of the Bankruptcy Code;
(ix)
the disallowance, under Section 502 of the Bankruptcy Code, of all or any portion of the claims of the Guaranteed Parties or the Administrative Agent for repayment of all or any part of the Guaranteed Obligations;
(x)
the failure of any other guarantor to sign or become party to this Guaranty or any amendment, change, or reaffirmation hereof; or
(xi)
any other act or omission to act or delay of any kind by the Borrower, any other guarantor of the Guaranteed Obligations, the Administrative Agent, any Guaranteed Party or any other Person or any other circumstance whatsoever which might, but for the provisions of this Section 3, constitute a legal or equitable discharge of any Guarantor's obligations hereunder or otherwise reduce, release, prejudice or extinguish its liability under this Guaranty.
SECTION 4.
Discharge Only Upon Payment In Full; Reinstatement In Certain Circumstances
. Each of the Guarantors' obligations hereunder shall remain in full force and effect until all Guaranteed Obligations shall have been paid in full in cash (other than Unliquidated Obligations that have not yet arisen) and the Revolving Commitments and Swingline Commitments and all Letters of Credit issued under the Credit Agreement shall have terminated or expired or, in the case of all Letters of Credit, are fully collateralized on terms reasonably acceptable to the Administrative Agent, at which time, subject to all the foregoing conditions, the guarantees made hereunder shall automatically terminate. If at any time any payment of the principal of or interest on any Loan, Obligation or any other amount payable by the Borrower or any other party under the Credit Agreement or any other Loan Document (including a payment effected through exercise of a right of setoff) is rescinded, or is or must be otherwise restored or returned upon the insolvency, bankruptcy or reorganization of the Borrower or otherwise (including pursuant to any settlement entered into by a Guaranteed Party in its discretion), each of the Guarantors' obligations hereunder with respect to such payment shall be reinstated as though such payment had been due but not made at such time. “Unliquidated Obligations” means at any time, any Obligations (or portion thereof) that are contingent in nature or unliquidated at such time, including any Obligation that is: (i) an obligation under the Credit Agreement to reimburse the Issuing Bank for drawings not yet made under a Letter of Credit issued by it; (ii) any other obligation (including any guarantee) under the Credit
Agreement that is contingent in nature at such time; or (iii) an obligation under the Credit Agreement to provide collateral to secure any of the foregoing types of obligations.
SECTION 5.
General Waivers; Additional Waivers
.
(a)
General Waivers
. Each of the Guarantors irrevocably waives acceptance hereof, presentment, demand or action on delinquency, protest, the benefit of any statutes of limitations and, to the fullest extent permitted by law, any notice not provided for herein or under the other Loan Documents, as well as any requirement that at any time any action be taken by any Person against the Borrower, any other guarantor of the Guaranteed Obligations, or any other Person.
(b)
Additional Waivers
. Notwithstanding anything herein to the contrary, each of the Guarantors hereby absolutely, unconditionally, knowingly, and expressly waives, to the fullest extent permitted by law:
(i) any right it may have to revoke this Guaranty as to future indebtedness or notice of acceptance hereof;
(ii) (1) notice of acceptance hereof; (2) notice of any Loans, Letters of Credit or other financial accommodations made or extended under the Loan Documents or the creation or existence of any Guaranteed Obligations; (3) notice of the amount of the Guaranteed Obligations, subject, however, to each Guarantor's right to make inquiry of the Administrative Agent and the Guaranteed Parties to ascertain the amount of the Guaranteed Obligations at any reasonable time; (4) notice of any adverse change in the financial condition of the Borrower or of any other fact that might increase such Guarantor's risk hereunder; (5) notice of presentment for payment, demand, protest, and notice thereof as to any instruments among the Loan Documents; (6) notice of any Default or Event of Default; and (7) all other notices (except if such notice is specifically required to be given to such Guarantor hereunder or under the Loan Documents) and demands to which each Guarantor might otherwise be entitled;
(iii) its right, if any, to require the Administrative Agent and the other Guaranteed Parties to institute suit against, or to exhaust any rights and remedies which the Administrative Agent and the other Guaranteed Parties has or may have against, the other Guarantors or any third party; and each Guarantor further waives any defense arising by reason of any disability or other defense (other than the defense that the Guaranteed Obligations shall have been fully and finally performed and indefeasibly paid in full in cash) of the other Guarantors or by reason of the cessation from any cause whatsoever of the liability of the other Guarantors in respect thereof;
(iv) (a) any rights to assert against the Administrative Agent and the other Guaranteed Parties any defense (legal or equitable), set-off, counterclaim, or claim which such Guarantor may now or at any time hereafter have against the other Guarantors or any other party liable to the Administrative Agent and the other Guaranteed Parties unless due to the
gross negligence or willful misconduct of the Administrative Agent or such Guaranteed Party as determined by a court of competent jurisdiction in a final non-appealable judgment
; (b) any defense, set-off, counterclaim, or claim, of any kind or nature, arising directly or indirectly from the present or future lack of sufficiency, validity, or enforceability of the Guaranteed Obligations; (c) any defense such Guarantor has to performance hereunder, and any right such Guarantor has to be exonerated, arising by reason of: (1) the impairment or suspension of the Administrative Agent's and the other Guaranteed Parties' rights or remedies against the other guarantor of the Guaranteed Obligations; (2) the alteration by the Administrative Agent and the other Guaranteed Parties of the Guaranteed Obligations; (3) any discharge of the other Guarantors' obligations to the
Administrative Agent and the other Guaranteed Parties by operation of law as a result of the Administrative Agent's and the other Guaranteed Parties' intervention or omission; or (4) the acceptance by the Administrative Agent and the other Guaranteed Parties of anything in partial satisfaction of the Guaranteed Obligations; and (d) the benefit of any statute of limitations affecting such Guarantor's liability hereunder or the enforcement thereof, and any act which shall defer or delay the operation of any statute of limitations applicable to the Guaranteed Obligations shall similarly operate to defer or delay the operation of such statute of limitations applicable to such Guarantor's liability hereunder; and
(v) any defense arising by reason of or deriving from (a) any claim or defense based upon an election of remedies by the Administrative Agent and the Guaranteed Parties; or (b) any election by the Administrative Agent and the other Guaranteed Parties under the Bankruptcy Code, to limit the amount of its claim against the Guarantors.
SECTION 6.
Subordination of Subrogation; Subordination of Intercompany Indebtedness
.
(a)
Subordination of Subrogation
. Until the Guaranteed Obligations have been fully and finally performed and indefeasibly paid in full in cash (other than Unliquidated Obligations), the Guarantors (i) shall have no right of subrogation with respect to such Guaranteed Obligations and (ii) waive any right to enforce any remedy which the Issuing Bank, any of the Guaranteed Parties or the Administrative Agent now have or may hereafter have against the Borrower, any endorser or any guarantor of all or any part of the Guaranteed Obligations or any other Person. Should any Guarantor have the right, notwithstanding the foregoing, to exercise its subrogation rights, each Guarantor hereby expressly and irrevocably (A) subordinates any and all rights at law or in equity to subrogation, reimbursement, exoneration, contribution, indemnification or set off that such Guarantor may have to the payment in full in cash of the Guaranteed Obligations until the Guaranteed Obligations are indefeasibly paid in full in cash (other than Unliquidated Obligations) and (B) waives any and all defenses available to a surety, guarantor or accommodation co-obligor until the Guaranteed Obligations are indefeasibly paid in full in cash (other than Unliquidated Obligations that have not yet arisen). Each Guarantor acknowledges and agrees that this subordination is intended to benefit the Administrative Agent and the Guaranteed Parties and shall not limit or otherwise affect such Guarantor's liability hereunder or the enforceability of this Guaranty, and that the Administrative Agent, the Guaranteed Parties and their respective successors and assigns are intended third party beneficiaries of the waivers and agreements set forth in this Section 6(a).
(b)
Subordination of Intercompany Indebtedness
. Each Guarantor agrees that any and all claims of such Guarantor against the Borrower or any other Guarantor hereunder (each an “Obligor”) with respect to any “Intercompany Indebtedness” (as hereinafter defined), any endorser, obligor or any other guarantor of all or any part of the Guaranteed Obligations, or against any of its properties shall be subordinate and subject in right of payment to the prior payment, in full and in cash, of all Guaranteed Obligations; provided that, as long as no Event of Default has occurred and is continuing, such Guarantor may receive payments of principal and interest from any Obligor with respect to Intercompany Indebtedness. Notwithstanding any right of any Guarantor to ask, demand, sue for, take or receive any payment from any Obligor, all rights, liens and security interests of such Guarantor, whether now or hereafter arising and howsoever existing, in any assets of any other Obligor shall be and are subordinated to the rights of the Guaranteed Parties and the Administrative Agent in those assets. No Guarantor shall have any right to possession of any such asset or to foreclose upon any such asset, whether by judicial action or otherwise, unless and until all of the Guaranteed Obligations shall have been fully paid and satisfied (in cash) and all financing arrangements pursuant to any Loan Document have been terminated. If all or any part of the assets of any Obligor, or the proceeds thereof, are subject to any distribution, division or application to the creditors of such Obligor, whether partial or complete, voluntary or
involuntary, and whether by reason of liquidation, bankruptcy, arrangement, receivership, assignment for the benefit of creditors or any other action or proceeding, or if the business of any such Obligor is dissolved or if substantially all of the assets of any such Obligor are sold, then, and in any such event (such events being herein referred to as an “
Insolvency Event
”), any payment or distribution of any kind or character, either in cash, securities or other property, which shall be payable or deliverable upon or with respect to any indebtedness of any Obligor to any Guarantor (“
Intercompany Indebtedness
”) shall be paid or delivered directly to the Administrative Agent for application on any of the Guaranteed Obligations, due or to become due, until such Guaranteed Obligations shall have first been fully paid and satisfied (in cash). Should any payment, distribution, security or instrument or proceeds thereof be received by the applicable Guarantor upon or with respect to the Intercompany Indebtedness after any Insolvency Event and prior to the satisfaction of all of the Guaranteed Obligations and the termination of all financing arrangements pursuant to any Loan Document among the Borrower and the Guaranteed Parties, such Guarantor shall receive and hold the same in trust, as trustee, for the benefit of the Guaranteed Parties and shall forthwith deliver the same to the Administrative Agent, for the benefit of the Guaranteed Parties, in precisely the form received (except for the endorsement or assignment of such Guarantor where necessary), for application to any of the Guaranteed Obligations, due or not due, and, until so delivered, the same shall be held in trust by the Guarantor as the property of the Guaranteed Parties. If any such Guarantor fails to make any such endorsement or assignment to the Administrative Agent, the Administrative Agent or any of its officers or employees is irrevocably authorized to make the same. Each Guarantor agrees that until the Guaranteed Obligations (other than the Unliquidated Obligations) have been paid in full (in cash) and satisfied and all financing arrangements pursuant to any Loan Document among the Borrower and the Guaranteed Parties have been terminated, no Guarantor will assign or transfer to any Person (other than the Administrative Agent) any claim any such Guarantor has or may have against any Obligor.
SECTION 7.
Contribution with Respect to Guaranteed Obligations
.
(a) To the extent that any Guarantor shall make a payment under this Guaranty (a “
Guarantor Payment
”) which, taking into account all other Guarantor Payments then previously or concurrently made by any other Guarantor, exceeds the amount which otherwise would have been paid by or attributable to such Guarantor if each Guarantor had paid the aggregate Guaranteed Obligations satisfied by such Guarantor Payment in the same proportion as such Guarantor's “Allocable Amount” (as defined below) (as determined immediately prior to such Guarantor Payment) bore to the aggregate Allocable Amounts of each of the Guarantors as determined immediately prior to the making of such Guarantor Payment,
then
, following indefeasible payment in full in cash of the Guarantor Payment and the Guaranteed Obligations (other than Unliquidated Obligations that have not yet arisen), and all Revolving Commitments, Swingline Commitments and Letters of Credit have terminated or expired or, in the case of all Letters of Credit, are fully collateralized on terms reasonably acceptable to the Administrative Agent, and the Credit Agreement has terminated, such Guarantor shall be entitled to receive contribution and indemnification payments from, and be reimbursed by, each other Guarantor for the amount of such excess,
pro
rata
based upon their respective Allocable Amounts in effect immediately prior to such Guarantor Payment.
(b) As of any date of determination, the “Allocable Amount” of any Guarantor shall be equal to the excess of the fair saleable value of the property of such Guarantor over the total liabilities of such Guarantor (including the maximum amount reasonably expected to become due in respect of contingent liabilities, calculated, without duplication, assuming each other Guarantor that is also liable for such contingent liability pays its ratable share thereof), giving effect to all payments made by other Guarantors as of such date in a manner to maximize the amount of such contributions.
(c) This Section 7 is intended only to define the relative rights of the Guarantors, and nothing set forth in this Section 7 is intended to or shall impair the obligations of the Guarantors, jointly and severally, to pay any amounts as and when the same shall become due and payable in accordance with the terms of this Guaranty.
(d) The parties hereto acknowledge that the rights of contribution and indemnification hereunder shall constitute assets of the Guarantor or Guarantors to which such contribution and indemnification is owing.
(e)
The rights of the indemnifying Guarantors against other Guarantors under this Section 7 shall be exercisable upon the full and indefeasible payment of the Guaranteed Obligations in cash (other than Unliquidated Obligations that have not yet arisen) and the termination or expiry (or in the case of all Letters of Credit full collateralization), on terms reasonably acceptable to the Administrative Agent, of the Revolving Commitments, Swingline Commitments and all Letters of Credit issued under the Credit Agreement and the termination of the Credit Agreement.
SECTION 8.
Limitation of Guaranty
. Notwithstanding any other provision of this Guaranty, the amount guaranteed by each Guarantor hereunder shall be limited to the extent, if any, required so that its obligations hereunder shall not be subject to avoidance under Section 548 of the Bankruptcy Code or under any applicable state Uniform Fraudulent Transfer Act, Uniform Fraudulent Conveyance Act or similar statute or common law. In determining the limitations, if any, on the amount of any Guarantor's obligations hereunder pursuant to the preceding sentence, it is the intention of the parties hereto that any rights of subrogation, indemnification or contribution which such Guarantor may have under this Guaranty, any other agreement or applicable law shall be taken into account.
SECTION 9.
Stay of Acceleration
. If acceleration of the time for payment of any amount payable by the Borrower under the Credit Agreement or any other Loan Document is stayed upon the insolvency, bankruptcy or reorganization of the Borrower or any of its Affiliates, all such amounts otherwise subject to acceleration under the terms of the Credit Agreement or any other Loan Document shall nonetheless be payable by each of the Guarantors hereunder forthwith on demand by the Administrative Agent.
SECTION 10.
Notices
. All notices, requests and other communications to any party hereunder shall be given in the manner prescribed in Section 13.1. of the Credit Agreement with respect to the Administrative Agent at its notice address therein and, with respect to any Guarantor, in the care of the Borrower at the address of the Borrower set forth in the Credit Agreement, or such other address or telecopy number as such party may hereafter specify for such purpose in accordance with the provisions of Section 13.1. of the Credit Agreement.
SECTION 11.
No Waivers
. No failure or delay by the Administrative Agent or any Guaranteed Party in exercising any right, power or privilege hereunder shall operate as a waiver thereof nor shall any single or partial exercise thereof preclude any other or further exercise thereof or the exercise of any other right, power or privilege. The rights and remedies provided in this Guaranty, the Credit Agreement and the other Loan Documents shall be cumulative and not exclusive of any rights or remedies provided by law.
SECTION 12.
Successors and Assigns
. This Guaranty is for the benefit of the Administrative Agent and the Guaranteed Parties and their respective successors and permitted assigns,
provided
, that no Guarantor shall have any right to assign its rights or obligations hereunder without the consent of the Administrative Agent, and any such assignment in violation of this Section 12 shall be null and void; and in the event of an assignment of any amounts payable under the Credit Agreement or the other Loan
Documents in accordance with the respective terms thereof, the rights hereunder, to the extent applicable to the indebtedness so assigned, may be transferred with such indebtedness. This Guaranty shall be binding upon each of the Guarantors and their respective successors and assigns.
SECTION 13.
Changes in Writing
. Other than in connection with the addition of additional Subsidiaries, which become parties hereto by executing a Guaranty Supplement hereto in the form attached as
Annex I
, neither this Guaranty nor any provision hereof may be changed, waived, discharged or terminated orally, but only in writing signed by each of the Guarantors and the Administrative Agent.
SECTION 14.
Governing Law; Jurisdiction
.
(a) THIS GUARANTY
SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO CONTRACTS EXECUTED, AND TO BE FULLY PERFORMED, IN SUCH STATE
.
(b) EACH PARTY HERETO ACKNOWLEDGES THAT ANY DISPUTE OR CONTROVERSY BETWEEN OR AMONG THE GUARANTORS OR THE ADMINISTRATIVE AGENT WOULD BE BASED ON DIFFICULT AND COMPLEX ISSUES OF LAW AND FACT AND WOULD RESULT IN DELAY AND EXPENSE TO THE PARTIES. ACCORDINGLY, TO THE EXTENT PERMITTED BY APPLICABLE LAW, THE ADMINISTRATIVE AGENT AND EACH OF THE GUARANTORS HEREBY WAIVES ITS RIGHT TO A TRIAL BY JURY IN ANY ACTION OR PROCEEDING OF ANY KIND OR NATURE IN ANY COURT OR TRIBUNAL IN WHICH AN ACTION MAY BE COMMENCED BY OR AGAINST ANY PARTY HERETO ARISING OUT OF THIS GUARANTY, THE CREDIT AGREEMENT, THE NOTES, OR ANY OTHER LOAN DOCUMENT OR THE FEE LETTER OR BY REASON OF ANY OTHER SUIT, CAUSE OF ACTION OR DISPUTE WHATSOEVER BETWEEN OR AMONG THE BORROWER, THE GUARANTORS, THE PARENT, THE ADMINISTRATIVE AGENT, THE ISSUING BANK OR ANY OF THE LENDERS OF ANY KIND OR NATURE.
(c) EACH GUARANTOR IRREVOCABLY AND UNCONDITIONALLY AGREES THAT IT WILL NOT COMMENCE ANY ACTION, LITIGATION OR PROCEEDING OF ANY KIND OR DESCRIPTION, WHETHER IN LAW OR EQUITY, WHETHER IN CONTRACT OR IN TORT OR OTHERWISE, AGAINST THE ADMINISTRATIVE AGENT, ANY LENDER, THE ISSUING BANK, OR ANY RELATED PARTY OF THE FOREGOING IN ANY WAY RELATING TO THIS GUARANTY OR ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS RELATING HERETO OR THERETO, IN ANY FORUM OTHER THAN THE COURTS OF THE STATE OF NEW YORK 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, AND EACH OF THE PARTIES HERETO IRREVOCABLY AND UNCONDITIONALLY SUBMITS TO THE JURISDICTION OF SUCH COURTS AND AGREES THAT ALL CLAIMS IN RESPECT OF ANY SUCH ACTION, LITIGATION OR PROCEEDING MAY BE HEARD AND DETERMINED IN SUCH NEW YORK STATE COURT OR, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, IN SUCH FEDERAL COURT. EACH OF THE PARTIES HERETO AGREES THAT A FINAL, NON-APPEALABLE JUDGMENT IN ANY SUCH ACTION, LITIGATION 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 OR IN ANY OTHER LOAN DOCUMENT SHALL AFFECT ANY RIGHT THAT THE ADMINISTRATIVE AGENT, ANY LENDER OR THE ISSUING BANK MAY OTHERWISE HAVE TO BRING ANY ACTION OR PROCEEDING RELATING TO THIS GUARANTY OR ANY OTHER LOAN DOCUMENT AGAINST ANY GUARANTOR OR ITS PROPERTIES IN THE COURTS OF ANY JURISDICTION. EACH PARTY FURTHER WAIVES ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH ACTION OR PROCEEDING IN ANY SUCH COURT OR THAT SUCH ACTION OR PROCEEDING WAS BROUGHT IN AN INCONVENIENT FORUM AND EACH AGREES NOT TO PLEAD OR CLAIM THE SAME. THE CHOICE OF FORUM SET FORTH IN THIS SECTION SHALL NOT BE DEEMED TO PRECLUDE THE BRINGING OF ANY ACTION BY THE ADMINISTRATIVE AGENT, THE ISSUING BANK OR ANY LENDER OR THE ENFORCEMENT BY THE ADMINISTRATIVE AGENT, THE ISSUING BANK OR ANY LENDER OF ANY JUDGMENT OBTAINED IN SUCH FORUM IN ANY OTHER APPROPRIATE JURISDICTION.
(d) EACH GUARANTOR HEREBY WAIVES PERSONAL SERVICE OF THE SUMMONS AND COMPLAINT, OR OTHER PROCESS OR PAPERS ISSUED THEREIN, AND AGREES THAT SERVICE OF SUCH SUMMONS AND COMPLAINT, OR OTHER PROCESS OR PAPERS MAY BE MADE BY REGISTERED OR CERTIFIED MAIL ADDRESSED TO THE BORROWER AT ITS ADDRESS FOR NOTICES PROVIDED FOR IN THE CREDIT AGREEMENT. SHOULD A GUARANTOR FAIL TO APPEAR OR ANSWER ANY SUMMONS, COMPLAINT, PROCESS OR PAPERS SO SERVED WITHIN THIRTY (30) DAYS AFTER THE MAILING THEREOF, SUCH GUARANTOR SHALL BE DEEMED IN DEFAULT AND AN ORDER AND/OR JUDGMENT MAY BE ENTERED AGAINST IT AS DEMANDED OR PRAYED FOR IN SUCH SUMMONS, COMPLAINT, PROCESS OR PAPERS.
(e) THE PROVISIONS OF THIS SECTION HAVE BEEN CONSIDERED BY EACH PARTY WITH THE ADVICE OF COUNSEL AND WITH A FULL UNDERSTANDING OF THE LEGAL CONSEQUENCES THEREOF, AND SHALL SURVIVE THE PAYMENT OF THE LOANS AND ALL OTHER GUARANTEED OBLIGATIONS, THE TERMINATION OR EXPIRATION OF ALL LETTERS OF CREDIT, THE TERMINATION OF THE CREDIT AGREEMENT AND THE TERMINATION OF THIS GUARANTY
.
SECTION 15.
No Strict Construction
. The parties hereto have participated jointly in the negotiation and drafting of this Guaranty. In the event an ambiguity or question of intent or interpretation arises, this Guaranty shall be construed as if drafted jointly by the parties hereto and no presumption or burden of proof shall arise favoring or disfavoring any party by virtue of the authorship of any provisions of this Guaranty.
SECTION 16.
Taxes; Expenses of Enforcement, Etc.
(a)
Taxes
. All payments by any Guarantor of principal of, and interest on, the Loans and all other Obligations shall be made free and clear of and without deduction for any Taxes. If any
withholding or deduction from any payment to be made by a Guarantor hereunder is required in respect of any Taxes pursuant to any Applicable Law, then such Guarantor will:
(i)
pay directly to the relevant Governmental Authority the full amount required to be so withheld or deducted;
(ii)
promptly forward to the Administrative Agent an official receipt or other documentation satisfactory to the Administrative Agent evidencing such payment to such Governmental Authority; and
(iii)
pay to the Administrative Agent for its account or the account of the applicable Lender or the Issuing Bank, as the case may be, such additional amount or amounts as is necessary to ensure that the net amount actually received by the Administrative Agent, the Issuing Bank or such Lender will equal the full amount that the Administrative Agent, the Issuing Bank or such Lender would have received had no such withholding or deduction been required.
(iv)
If any Guarantor fails to pay any Taxes when due to the appropriate Governmental Authority or fails to remit to the Administrative Agent, for its account or the account of the Issuing Bank or respective Lender, as the case may be, the required receipts or other required documentary evidence, the Guarantors shall indemnify the Administrative Agent, the Issuing Bank and the Lenders for any incremental Taxes, interest or penalties that may become payable by the Administrative Agent, the Issuing Bank or any Lender as a result of any such failure.
(v)
By accepting the benefits hereof, each Lender agrees that it will comply with Section 3.10.(c) of the Credit Agreement.
(b) The Guarantors agree to reimburse the Guaranteed Parties for any reasonable costs and out-of-pocket expenses (including attorneys' fees) paid or incurred by any Guaranteed Party in connection with the collection and enforcement of amounts due under the Loan Documents, including without limitation this Guaranty.
SECTION 17.
[
Reserved
]
SECTION 18.
Financial Information
. Each Guarantor hereby assumes responsibility for keeping itself informed of the financial condition of the Borrower, the other Guarantors and any and all endorsers and/or other guarantors of all or any part of the Guaranteed Obligations, and of all other circumstances bearing upon the risk of nonpayment of the Guaranteed Obligations, or any part thereof, that diligent inquiry would reveal, and each Guarantor hereby agrees that none of the Guaranteed Parties or the Administrative Agent shall have any duty to advise such Guarantor of information known to any of them regarding such condition or any such circumstances. In the event any Guaranteed Party or the Administrative Agent, in its sole discretion, undertakes at any time or from time to time to provide any such information to a Guarantor, such Guaranteed Party or the Administrative Agent shall be under no obligation (i) to undertake any investigation not a part of its regular business routine, (ii) to disclose any information which such Guaranteed Party or the Administrative Agent, pursuant to accepted or reasonable commercial finance or banking practices, wishes to maintain confidential or (iii) to make any other or future disclosures of such information or any other information to such Guarantor.
SECTION 19.
Severability
. Wherever possible, each provision of this Guaranty shall be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Guaranty shall be prohibited by or invalid under such law, such provision shall be ineffective to the extent
of such prohibition or invalidity without invalidating the remainder of such provision or the remaining provisions of this Guaranty.
SECTION 20.
Merger
. This Guaranty represents the final agreement of each of the Guarantors with respect to the matters contained herein and may not be contradicted by evidence of prior or contemporaneous agreements, or subsequent oral agreements, between each such Guarantor and any Guaranteed Party or the Administrative Agent.
SECTION 21.
Headings
. Section headings in this Guaranty are for convenience of reference only and shall not govern the interpretation of any provision of this Guaranty.
SECTION 22.
Termination of Guarantors
. The obligations of any Guarantor under this Guaranty shall automatically terminate in accordance with Section 8.14.(b) of the Credit Agreement.
SECTION 23.
AMENDMENT, RESTATEMENT AND CONSOLIDATION; NO NOVATION
. THE EXISTING GUARANTY IS BEING AMENDED, RESTATED AND CONSOLIDATED IN ITS ENTIRETY BY THIS GUARANTY FOR THE CONVENIENCE OF THE PARTIES. THIS GUARANTY MERELY AMENDS, MODIFIES, RESTATES AND CONSOLIDATES THE OBLIGATIONS EVIDENCED BY THE EXISTING GUARANTY AND DOES NOT CONSTITUTE, AND IT IS THE EXPRESS INTENT OF THE PARTIES HERETO THAT THIS GUARANTY DOES NOT EFFECT, A NOVATION OF THE EXISTING OBLIGATIONS OF THE GUARANTORS PARTY TO THE EXISTING GUARANTY. ALL SUCH OBLIGATIONS CONTINUE TO REMAIN OUTSTANDING AND EVIDENCED BY THIS GUARANTY. THE AMENDMENT, RESTATEMENT AND CONSOLIDATION EFFECTED HEREBY SHALL BE DEEMED TO HAVE PROSPECTIVE APPLICATION ONLY FROM AND AFTER THE EFFECTIVE DATE, UNLESS OTHERWISE EXPRESSLY STATED HEREIN.
SECION 24.
General Partners
.
(a) CBL Holdings I, Inc., the general partner of the Borrower, shall not be personally liable for the payment of the Guaranteed Obligations, except to the extent provided for in Section 13.21. of the Credit Agreement.
(b) Subject to the exceptions and qualifications described below, so long as any general partner of a Guarantor (specifically excluding, however, CBL & Associates Limited Partnership) (each a “General Partner”) owns no property or assets (including Equity Interests in any Person) other than its interest in Guarantor, said General Partner (specifically excluding, however, CBL & Associates Limited Partnership) shall not be personally liable for the payment of the Guaranteed Obligations. Notwithstanding the foregoing: (i) if an Event of Default occurs, nothing contained herein shall in any way prevent or hinder the Administrative Agent, the Issuing Bank or the Lenders in the enforcement or foreclosure of any Lien securing any of the Obligations, or in the pursuit or enforcement of any right, remedy or judgment against the Guarantor, the Borrower or any other Loan Party, or any of their respective assets; (ii) the General Partner shall be fully liable to the Administrative Agent and the Lenders to the same extent that the General Partner would be liable absent the foregoing provisions of this Section for fraud or willful misrepresentation by the General Partner, or its Affiliates, (to the full extent of losses suffered by the Administrative Agent or any Lender by reason of such fraud or willful misrepresentations); and (iii) CBL & Associates Limited Partnership shall in all events be fully and personally liable for payment of the Obligations as set forth in the Loan Documents.
[
SIGNATURE PAGES TO FOLLOW
]
IN WITNESS WHEREOF, each Initial Guarantor has caused this Guaranty to be duly executed by its authorized officer as of the day and year first above written.
|
|
|
|
[
GUARANTORS TO COME
]
By:______________________________
Name:
Title:
|
Signature Page to Guaranty
Acknowledged and Agreed to:
WELLS FARGO BANK, NATIONAL ASSOCIATION, as Administrative Agent
By:__________________________________
Name:
Title:
Signature Page to Guaranty
ANNEX I TO AMENDED AND RESTATED GUARANTY
Reference is hereby made to the Amended and Restated Guaranty (as the same may be amended, restated, supplemented or otherwise modified from time to time, the “Guaranty”), dated as of ____________ __, _____, made by each of the Subsidiaries of CBL & Associates Limited Partnership (the “Borrower”) listed on the signature pages thereto (each an “Initial Guarantor”, and together with any additional Subsidiaries which become parties to the Guaranty by executing Guaranty Supplements thereto substantially similar in form and substance hereto, the “Guarantors”), in favor of the Administrative Agent, for the ratable benefit of the Guaranteed Parties, under the Credit Agreement. Each capitalized term used herein and not defined herein shall have the meaning given to it in the Guaranty.
By its execution below, the undersigned,
[
NAME OF NEW GUARANTOR
]
, a
[
________________
] [
corporation
]
[
partnership
]
[
limited liability company
]
(the “New Guarantor”), agrees to become, and does hereby become, a Guarantor under the Guaranty and agrees to be bound by such Guaranty as if originally a party thereto. By its execution below, the undersigned represents and warrants as to itself that all of the representations and warranties contained in Section 1 of the Guaranty are true and correct in all respects as of the date hereof.
IN WITNESS WHEREOF, the New Guarantor has executed and delivered this
Annex I
counterpart to the Guaranty as of this __________ day of _________, 20___.
[
NAME OF NEW GUARANTOR
]
By:____________________________________
Name:
Title:
EXHIBIT C
NOTICE OF BORROWING
CBL & ASSOCIATES
LIMITED PARTNERSHIP
__________ __, 20__
Wells Fargo Bank, National Association
123 North Wacker Drive, Suite 1900
Chicago, Illinois 60606
ATTN: ____________________
Ladies and Gentlemen:
Reference is made to that certain Third Amended and Restated Credit Agreement dated as of November 13, 2012 (as it may be modified, amended and restated from time to time, the "Credit Agreement"), by and among CBL & Associates Limited Partnership (the "Borrower"), CBL & Associates Properties, Inc., Wells Fargo Bank, National Association and the other lenders from time to time party thereto (collectively, together with Assignees under
Section 13.6
thereof, the "Lenders") and Wells Fargo Bank, National Association, as administrative agent (in such capacity, "Administrative Agent"). Capitalized terms used herein, and not otherwise defined herein, have their respective meanings given them in the Credit Agreement.
|
|
1.
|
Pursuant to
Section 2.1(b)
of the Credit Agreement, the Borrower hereby requests that the Lenders make a Revolving Loan to the Borrower in an amount equal to ____________ Dollars ($________).
|
|
|
2.
|
The Borrower requests that the Revolving Loan be made available to the Borrower on _____________, 20__.
|
|
|
3.
|
The Borrower hereby requests that the requested Revolving Loan be of the following Type:
|
[Check one box only]
□
Base Rate Loan
□
LIBOR Loan, with an initial Interest Period for a duration of:
□
one month
□
three months
□
six months
Wells Fargo Bank, National Association
___________, ____
Page 2
The Borrower hereby certifies to the Administrative Agent and the Lenders that as of the date hereof, as of the proposed date of the requested Revolving Loan, and after giving effect to such Revolving Loan, (a) the proposed use of the proceeds of such Loan set forth above is consistent with the provisions of
Section 8.8
of the Credit Agreement; (b) there exists no Default or Event of Default, nor will a Default or Event of Default exist immediately after giving effect to the Revolving Loan requested hereunder; (c) none of the conditions described in Section 2.15. would exist after giving effect to the making of such Loan; and (d) all of the representations and warranties made by Borrower or any other Loan Party under the Credit Agreement or under any of the other Loan Documents are true and correct in all material respects (except in the case of a representation or warranty qualified by materiality, in which case such representation or warranty shall be true and correct in all respects) on and as of the date hereof with the same force and effect as if made on and as of such date, except to the extent such representations or warranties expressly relate solely to an earlier date (in which case such representations and warranties shall have been true and accurate in all material respects (except in the case of a representation or warranty qualified by materiality, in which case such representation or warranty shall be true and correct in all respects) on and as of such earlier date) and except for changes in factual circumstances specifically and expressly permitted under the Credit Agreement or the other Loan Documents. In addition, the Borrower certifies to the Administrative Agent and the Lenders that all conditions to the making of the requested Revolving Loans contained in Article VI. of the Credit Agreement will have been satisfied at the time such Revolving Loans are made.
|
|
|
|
CBL & ASSOCIATES LIMITED PARTNERSHIP
By: CBL Holdings I, Inc.,
as General Partner
By: ______________________
Name:
Title:
|
|
|
EXHIBIT D
NOTICE OF CONTINUATION
CBL & ASSOCIATES
LIMITED PARTNERSHIP
__________ __, 20___
Wells Fargo Bank, National Association
123 North Wacker Drive, Suite 1900
Chicago, Illinois 60606
Attention: __________________
Ladies and Gentlemen:
Reference is made to that certain Third Amended and Restated Credit Agreement dated as of November 13, 2012 (as it may be amended from time to time, the "Credit Agreement"), by and among CBL & Associates Limited Partnership (the "Borrower"), CBL & Associates Properties, Inc., Wells Fargo Bank, National Association and the other lenders from time to time party thereto (collectively, together with Assignees under
Section 13.6
thereof, the "Lenders"), and Wells Fargo Bank, National Association, as administrative agent (in such capacity, the "Administrative Agent"). Capitalized terms used herein and not otherwise defined herein, have their respective meanings given them in this Credit Agreement.
Pursuant to
Section 2.9
of the Credit Agreement, the Borrower hereby elects to the maintain all, or the portion set forth below, of the LIBOR Loan in the amount of ________________ Dollars ($____________) and having an Interest Period expiring on __________________, as a LIBOR Loan, and in that connection sets forth below the information relating to such continuation as required by such
Section 2.9
of the Credit Agreement:
|
|
1.
|
The requested date of such continuation is _________, 20___.
|
|
|
2.
|
The amount of the existing LIBOR Loan to be continued as a LIBOR Loan is:
|
[Check one box only]
□
All of said LIBOR Loan (being $________)
□
$__________
|
|
3.
|
The current Interest Period of the Loans subject to such continuation ends on _________, 20___.
|
Wells Fargo Bank, National Association
_______________, _____
Page 2
|
|
4.
|
The amount of the LIBOR Loan being continued shall have an Interest Period of:
|
[Check one box only]
□
one month
□
three months
□
six months
The Borrower hereby certifies to the Administrative Agent and the Lenders that as of the date hereof, as of the proposed date of the requested continuation, and after giving effect to such continuation, (a) there exists no Default or Event of Default, nor will a Default or Event of Default exist immediately after giving effect to the continuation requested hereunder; and (b) all of the representations and warranties made by Borrower or any other Loan Party under the Credit Agreement or under any of the other Loan Documents are true and correct in all material respects (except in the case of a representation or warranty qualified by materiality, in which case such representation or warranty shall be true and correct in all respects) on and as of the date hereof with the same force and effect as if made on and as of such date, except to the extent such representations or warranties expressly relate solely to an earlier date (in which case such representations and warranties shall have been true and accurate in all material respects (except in the case of a representation or warranty qualified by materiality, in which case such representation or warranty shall be true and correct in all respects) on and as of such earlier date) and except for changes in factual circumstances specifically and expressly permitted under the Credit Agreement or the other Loan Documents. In addition, the Borrower certifies to the Administrative Agent and the Lenders that all conditions to the making of the requested continuation contained in Article VI. of the Credit Agreement will have been satisfied at the time such continuation is made.
CBL & ASSOCIATES LIMITED PARTNERSHIP
By: CBL Holdings I, Inc., as General Partner
By: _______________________________
Name: _________________________
Title: __________________________
2
EXHIBIT E
NOTICE OF CONVERSION
CBL & ASSOCIATES
LIMITED PARTNERSHIP
__________ __, 20___
Wells Fargo Bank, National Association
123 North Wacker Drive, Suite 1900
Chicago, Illinois 60606
Attention: __________________
Ladies and Gentlemen:
Reference is made to that certain Third Amended and Restated Credit Agreement dated as of November 13, 2012 (as it may be amended from time to time, the "Credit Agreement"), by and among CBL & Associates Limited Partnership (the "Borrower"), CBL & Associates Properties, Inc., Wells Fargo Bank, National Association and the other lenders from time to time party thereto (collectively, together with Assignees under
Section 13.6
thereof, the "Lenders") and Wells Fargo Bank, National Association, as administrative agent (in such capacity, the "Administrative Agent"). Capitalized terms used herein and not otherwise defined herein, have their respective meanings given them in this Credit Agreement.
Pursuant to
Section 2.10
of the Credit Agreement, the Borrower hereby requests a conversion of a Revolving Loan of one Type into a Revolving Loan of another Type, and in that connection sets forth below the information relating to such conversion as required by such
Section 2.10
of the Credit Agreement:
|
|
1.
|
The requested date of such conversion is ___________, 20____.
|
|
|
2.
|
The Type of Revolving Loan to be Converted pursuant hereto is currently:
|
[Check one box only]
□
Base Rate Loan
□
LIBOR Loan
|
|
3.
|
The aggregate principal amount of the Revolving Loan subject to the requested conversion is $__________ and the portion of such principal amount subject to such conversion is $___________.
|
Wells Fargo Bank, National Association
_______________, _____
Page 2
|
|
4.
|
The amount of such Revolving Loan to be converted is to be converted into a Revolving Loan of the following Type:
|
[Check one box only]
□
Base Rate Loan
□
LIBOR Loan with an initial Interest Period for a duration of:
[check one box only]
□
one month
□
three months
□
six months
The Borrower hereby certifies to the Administrative Agent and the Lenders that as of the date hereof, as of the proposed date of the requested conversion, and after giving effect to such conversion, (a) there exists no Default or Event of Default, nor will a Default or Event of Default exist immediately after giving effect to the conversion requested hereunder; and (b) all of the representations and warranties made by Borrower or any other Loan Party under the Credit Agreement or under any of the other Loan Documents are true and correct in all material respects (except in the case of a representation or warranty qualified by materiality, in which case such representation or warranty shall be true and correct in all respects) on and as of the date hereof with the same force and effect as if made on and as of such date, except to the extent such representations or warranties expressly relate solely to an earlier date (in which case such representations and warranties shall have been true and accurate in all material respects (except in the case of a representation or warranty qualified by materiality, in which case such representation or warranty shall be true and correct in all respects) on and as of such earlier date) and except for changes in factual circumstances specifically and expressly permitted under the Credit Agreement or the other Loan Documents. In addition, the Borrower certifies to the Administrative Agent and the Lenders that all conditions to the making of the requested conversion contained in Article VI. of the Credit Agreement will have been satisfied at the time such conversion is made.
CBL & ASSOCIATES LIMITED PARTNERSHIP
By:
CBL Holdings I, Inc., as General Partner
By: __________________________________
Name: _________________________
Title: __________________________
2
EXHIBIT F
FORM OF NOTICE OF SWINGLINE BORROWING
CBL & ASSOCIATES
LIMITED PARTNERSHIP
____________, 20___
Wells Fargo Bank, National Association
123 North Wacker Drive, Suite 1900
Chicago, Illinois 60606
ATTN: ____________________
Ladies and Gentlemen:
Reference is made to the Third Amended and Restated Credit Agreement dated as of November 13, 2012 (as amended, restated, supplemented or otherwise modified from time to time, the “Credit Agreement”), by and CBL & Associates Limited Partnership (the "Borrower"), CBL & Associates Properties, Inc., Wells Fargo Bank, National Association and the other lenders from time to time party thereto (collectively, together with Assignees under
Section 13.6
thereof, the "Lenders") and Wells Fargo Bank, National Association, as administrative agent (in such capacity, "Administrative Agent"). Capitalized terms used herein, and not otherwise defined herein, have their respective meanings given them in the Credit Agreement.
|
|
1.
|
Pursuant to Section 2.3(b) of the Credit Agreement, the Borrower hereby requests that the Swingline Lender make a Swingline Loan to the Borrower in an amount equal to $___________________.
|
|
|
2.
|
The Borrower requests that such Swingline Loan be made available to the Borrower on ____________, 20___.
|
|
|
3.
|
The Borrower requests that the proceeds of such Swingline Loan be made available to the Borrower by ____________________, 20___.
|
The Borrower hereby certifies to the Administrative Agent, the Swingline Lender and the Lenders that as of the date hereof, as of the date of the making of the requested Swingline Loan, and after making such Swingline Loan, (a) the proposed use of the proceeds of such Swingline Loan set forth above is consistent with the provisions of
Section 8.8
of the Credit Agreement; (b) there exists no Default or Event of Default, nor will a Default or Event of Default exist immediately after giving effect to the Swingline Loan requested hereunder; (c) none of the conditions described in Section 2.15. would exist after giving effect to the making of such Swingline Loan; and (d) all of the representations and warranties made by Borrower or any other
Loan Party under the Credit Agreement or under any of the other Loan Documents are true and correct in all material respects (except in the case of a representation or warranty qualified by materiality, in which case such representation or warranty shall be true and correct in all respects) on and as of the date hereof with the same force and effect as if made on and as of such date, except to the extent such representations or warranties expressly relate solely to an earlier date (in which case such representations and warranties shall have been true and accurate in all material respects (except in the case of a representation or warranty qualified by materiality, in which case such representation or warranty shall be true and correct in all respects) on and as of such earlier date) and except for changes in factual circumstances specifically and expressly permitted under the Credit Agreement or the other Loan Documents. In addition, the Borrower certifies to the Administrative Agent and the Lenders that all conditions to the making of the requested Swingline Loan contained in Article VI. of the Credit Agreement will have been satisfied at the time such Swingline Loan is made.
[Continued on next page]
2
If notice of the requested borrowing of this Swingline Loan was previously given by telephone, this notice is to be considered the written confirmation of such telephone notice required by Section 2.3(b) of the Credit Agreement.
CBL & ASSOCIATES LIMITED PARTNERSHIP
By:
CBL Holdings I, Inc.,
as General Partner
By: _______________________________
Name:
Title:
3
EXHIBIT G
FORM OF SECOND AMENDED AND RESTATED PARENT GUARANTY
THIS SECOND AMENDED AND RESTATED PARENT GUARANTY (as the same may be amended, restated, supplemented or otherwise modified from time to time, this “Guaranty”) is made as of ____________ __, _____ by CBL & Associates Properties, Inc. (“Guarantor”) in favor of Wells Fargo Bank, National Association, as Administrative Agent (the “Administrative Agent”), for its benefit and for the benefit of the Lenders and the Issuing Bank under the Credit Agreement described below (the Administrative Agent, the Lenders and the Issuing Bank, each individually a “Guaranteed Party” and collectively, the “Guaranteed Parties”). Unless otherwise defined herein, capitalized terms used herein and not defined herein shall have the meanings ascribed to such terms in the Credit Agreement.
W
I
T
N
E
S
S
E
T
H
:
WHEREAS, CBL & Associates Limited Partnership (the “Borrower”), the Guarantor, the financial institutions party thereto from time to time (the “Existing Lenders”), and Wells Fargo Bank, National Association, as Administrative Agent (the “Existing Administrative Agent”) are party to that certain Second Amended and Restated Credit Agreement dated as of November 2, 2009 (as amended and in effect immediately prior to the date hereof, the “Existing Credit Agreement”);
WHEREAS, pursuant to the Existing Credit Agreement, the Guarantor entered into an Amended and Restated Guaranty in favor of the Existing Administrative Agent dated as of November 2, 2009 for the benefit of the Existing Lenders under the Existing Credit Agreement (as amended and in effect immediately prior to the date hereof, the “Existing Guaranty”);
WHEREAS, the Borrower, the Guarantor, each of the financial institutions initially a signatory thereto together with their successors and assignees (the “Lenders”) and the Administrative Agent have entered into that certain Third Amended and Restated Credit Agreement of even date herewith (as the same may be amended, restated, supplemented or otherwise modified from time to time, the “Credit Agreement”), which Credit Agreement provides, subject to the terms and conditions thereof, for extensions of credit and other financial accommodations to be made by the Lenders to or for the benefit of the Borrower;
WHEREAS, it is a condition precedent to the extensions of credit by the Lenders under the Credit Agreement that the Guarantor agree to amend and restate the Existing Guaranty in the form of this Guaranty, whereby the Guarantor shall guarantee the payment when due of all obligations of CBL Holdings I, Inc., the general partner of the Borrower, and its successors as general partner of the Borrower (hereinafter referred to as the “General Partner”) pursuant to the Loan Documents (subject to the limitations set forth in Section 13.21. of the Credit Agreement);
WHEREAS, it is a condition precedent to the extensions of credit by the Lenders under the Credit Agreement that certain Subsidiaries of the Borrower (collectively, the “Subsidiary Guarantors”) enter into that certain Amended and Restated Guaranty, dated as of the date hereof in favor of the Administrative Agent (the “Subsidiary Guaranty”); and
WHEREAS, in consideration of the direct and indirect financial and other support and benefits that the Borrower has provided, and such direct and indirect financial and other support and benefits as the Borrower may in the future provide, to the Guarantor, which significantly facilitates the business operations of the Borrower and the Guarantor, and in order to induce the Lenders and the Administrative Agent to enter into the Credit Agreement, and to make the Loans and the other financial accommodations
to the Borrower and to issue the Letters of Credit described in the Credit Agreement, the Guarantor is willing to guarantee the payment when due of all obligations of the General Partner under the Loan Documents;
NOW, THEREFORE, in consideration of the foregoing premises and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:
SECTION 1.
Representations, Warranties and Covenants
. The Guarantor represents and warrants to each Guaranteed Party and the Administrative Agent as of the date of this Guaranty, giving effect to the consummation of the transactions contemplated by the Loan Documents on the Effective Date, and thereafter on each date as required by Section 6.2. of the Credit Agreement that:
(a)
It is a corporation, duly organized, validly existing and in good standing under the jurisdiction of its incorporation, has the power and authority to own or lease its properties and to carry on its business as now being and hereafter proposed to be conducted and is duly qualified and is in good standing as a domestic or foreign corporation, and authorized to do business, in each jurisdiction in which the character of its properties or the nature of its business requires such qualification or authorization and where the failure to be so qualified or authorized could reasonably be expected to have, in each instance, a Material Adverse Effect.
(b)
It has the right and power, and has taken all necessary action to authorize it, to execute, deliver and perform this Guaranty in accordance with its terms and to perform its obligations hereunder. This Guaranty has been duly executed and delivered by the duly authorized officers of the Guarantor and is a legal, valid and binding obligation of the Guarantor enforceable against the Guarantor in accordance with its terms, except as the same may be limited by bankruptcy, insolvency, and other similar laws affecting the rights of creditors generally and the availability of equitable remedies for the enforcement of certain obligations contained herein and as may be limited by equitable principles generally.
(c)
The execution, delivery and performance of this Guaranty in accordance with its terms and the obligations hereunder do not and will not, by the passage of time, the giving of notice, or both: (i) require any Governmental Approval or violate any Applicable Law (including all Environmental Laws) relating to the Guarantor; (ii) conflict with, result in a breach of or constitute a default under the organizational documents of the Guarantor, or any indenture, agreement or other instrument to which the Guarantor is a party or by which it or any of its respective properties may be bound; or (iii) result in or require the creation or imposition of any Lien upon or with respect to any Property now owned or hereafter acquired by the Guarantor other than in favor of the Administrative Agent for its benefit and the benefit of the Guaranteed Parties and the Issuing Bank. It is in compliance with each Governmental Approval and all other Applicable Laws relating to it except for non-compliances which, and Governmental Approvals the failure to possess which, could not, individually or in the aggregate, reasonably be expected to cause a Default or Event of Default or have a Material Adverse Effect.
(d)
It has no Indebtedness other than Indebtedness permitted under the Credit Agreement.
In addition to the foregoing, the Guarantor covenants that, so long as any Guaranteed Party has any Revolving Commitment, Swingline Commitment or Letter of Credit outstanding under the Credit Agreement or any amount payable under the Credit Agreement or any other Obligations shall remain unpaid, it will, and, if necessary, will cause the Borrower and the General Partner to, fully comply with those covenants and agreements of the Borrower and the General Partner applicable to the Guarantor set forth in the Credit Agreement.
SECTION 2.
The Guaranty
. The Guarantor hereby irrevocably and unconditionally guarantees the full and punctual payment and performance when due (whether at stated maturity, upon acceleration or otherwise) of all obligations of the General Partner now or hereafter existing under the Credit Agreement, the Notes issued thereunder and the other Loan Documents executed in connection therewith (subject to the limitations set forth in Section 13.21. of the Credit Agreement) (all of the foregoing being referred to collectively as the “Guaranteed Obligations”). Upon the failure by the Borrower, the General Partner, or any of their respective Affiliates, as applicable, to pay punctually or perform the Guaranteed Obligations, subject to any applicable grace or notice and cure period, the Guarantor agrees that it shall forthwith on demand pay such amount or perform such obligation at the place and in the manner specified in the Credit Agreement or the relevant other Loan Document, as the case may be. The Guarantor hereby agrees that this Guaranty is an absolute, irrevocable and unconditional guaranty of payment and is not a guaranty of collection.
SECTION 3.
Guaranty Unconditional
. The obligations of the Guarantor hereunder shall be unconditional and absolute and, without limiting the generality of the foregoing, shall not be released, discharged or otherwise affected by:
(i)
any extension, renewal, settlement, indulgence, compromise, waiver or release of or with respect to the Guaranteed Obligations or any part thereof or any agreement relating thereto, or with respect to any obligation of any other guarantor of any of the Guaranteed Obligations, whether (in any such case) by operation of law or otherwise, or any failure or omission to enforce any right, power or remedy with respect to the Guaranteed Obligations or any part thereof or any agreement relating thereto, or with respect to any obligation of any other guarantor of any of the Guaranteed Obligations;
(ii)
any modification or amendment of or supplement to the Credit Agreement or any other Loan Document, including, without limitation, any such amendment which may increase the amount of, or the interest rates applicable to, any of the Guaranteed Obligations guaranteed hereby;
(iii)
any release, surrender, compromise, settlement, waiver, subordination or modification, with or without consideration, of any other guaranties with respect to the Guaranteed Obligations or any part thereof, or any other obligation of any person or entity with respect to the Guaranteed Obligations or any part thereof;
(iv)
any change in the corporate, partnership, limited liability company or other existence, structure or ownership of the Borrower, the General Partner or any other guarantor of any of the Guaranteed Obligations, or any insolvency, bankruptcy, reorganization or other similar proceeding affecting the Borrower, the General Partner or any other guarantor of the Guaranteed Obligations, or any of their respective assets or any resulting release or discharge of any obligation of the Borrower, the General Partner or any other guarantor of any of the Guaranteed Obligations;
(v)
the existence of any claim, setoff or other rights which the Guarantor may have at any time against the Borrower, the General Partner, any other guarantor of any of the Guaranteed Obligations, the Administrative Agent, any Guaranteed Party or any other Person, whether in connection herewith or in connection with any unrelated transactions,
provided
that nothing herein shall prevent the assertion of any such claim by separate suit or compulsory counterclaim;
(vi)
the enforceability or validity of the Guaranteed Obligations or any part thereof or the genuineness, enforceability or validity of any agreement relating thereto, or any other
invalidity or unenforceability relating to or against the Borrower, the General Partner or any other guarantor of any of the Guaranteed Obligations, for any reason related to the Credit Agreement or any other Loan Document, or any provision of applicable law, decree, order or regulation purporting to prohibit the payment by the Borrower, the General Partner or any other guarantor of the Guaranteed Obligations, of any of the Guaranteed Obligations or otherwise affecting any term of any of the Guaranteed Obligations;
(vii) the election by, or on behalf of, any one or more of the Guaranteed Parties, in any proceeding instituted under Chapter 11 of Title 11 of the United States Code (11 U.S.C. 101 et seq.) (or any successor statute, the “
Bankruptcy Code
”), of the application of Section 1111(b)(2) of the Bankruptcy Code;
(viii) any borrowing or grant of a security interest by the Borrower or the General Partner, as debtor-in-possession, under Section 364 of the Bankruptcy Code;
(ix) the disallowance, under Section 502 of the Bankruptcy Code, of all or any portion of the claims of the Guaranteed Parties or the Administrative Agent for repayment of all or any part of the Guaranteed Obligations;
(x) the failure of any other guarantor to sign or become party to this Guaranty or any amendment, change, or reaffirmation hereof; or
(xi) any other act or omission to act or delay of any kind by the Borrower, the General Partner, any other guarantor of the Guaranteed Obligations, the Administrative Agent, any Guaranteed Party or any other Person or any other circumstance whatsoever which might, but for the provisions of this Section 3, constitute a legal or equitable discharge of the Guarantor's obligations hereunder or otherwise reduce, release, prejudice or extinguish its liability under this Guaranty.
SECTION 4.
Discharge Only Upon Payment In Full; Reinstatement In Certain Circumstances
. The Guarantor's obligations hereunder shall remain in full force and effect until all Guaranteed Obligations shall have been paid in full in cash (other than Unliquidated Obligations that have not yet arisen) and the Revolving Commitments and Swingline Commitments and all Letters of Credit issued under the Credit Agreement shall have terminated or expired or, in the case of all Letters of Credit, are fully collateralized on terms reasonably acceptable to the Administrative Agent, at which time, subject to all the foregoing conditions, the guarantees made hereunder shall automatically terminate. If at any time any payment of the principal of or interest on any Loan, Obligation or any other amount payable by the Borrower, the General Partner or any other party under the Credit Agreement or any other Loan Document (including a payment effected through exercise of a right of setoff) is rescinded, or is or must be otherwise restored or returned upon the insolvency, bankruptcy or reorganization of the Borrower or the General Partner or otherwise (including pursuant to any settlement entered into by a Guaranteed Party in its discretion), the 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. “Unliquidated Obligations” means at any time, any Obligations (or portion thereof) that are contingent in nature or unliquidated at such time, including any Obligation that is: (i) an obligation under the Credit Agreement to reimburse the Issuing Bank for drawings not yet made under a Letter of Credit issued by it; (ii) any other obligation (including any guarantee) under the Credit Agreement that is contingent in nature at such time; or (iii) an obligation under the Credit Agreement to provide collateral to secure any of the foregoing types of obligations.
SECTION 5.
General Waivers; Additional Waivers
.
(a)
General Waivers
. The Guarantor irrevocably waives acceptance hereof, presentment, demand or action on delinquency, protest, the benefit of any statutes of limitations and, to the fullest extent permitted by law, any notice not provided for herein or under the other Loan Documents, as well as any requirement that at any time any action be taken by any Person against the Borrower, the General Partner, any other guarantor of the Guaranteed Obligations, or any other Person.
(b)
Additional Waivers
. Notwithstanding anything herein to the contrary, the Guarantor hereby absolutely, unconditionally, knowingly, and expressly waives, to the fullest extent permitted by law:
(i) any right it may have to revoke this Guaranty as to future indebtedness or notice of acceptance hereof;
(ii) (1) notice of acceptance hereof; (2) notice of any Loans, Letters of Credit or other financial accommodations made or extended under the Loan Documents or the creation or existence of any Guaranteed Obligations; (3) notice of the amount of the Guaranteed Obligations, subject, however, to the Guarantor's right to make inquiry of the Administrative Agent and the Guaranteed Parties to ascertain the amount of the Guaranteed Obligations at any reasonable time; (4) notice of any adverse change in the financial condition of the Borrower or the General Partner or of any other fact that might increase the Guarantor's risk hereunder; (5) notice of presentment for payment, demand, protest, and notice thereof as to any instruments among the Loan Documents; (6) notice of any Default or Event of Default; and (7) all other notices (except if such notice is specifically required to be given to the Guarantor hereunder or under the Loan Documents) and demands to which the Guarantor might otherwise be entitled;
(iii) its right, if any, to require the Administrative Agent and the other Guaranteed Parties to institute suit against, or to exhaust any rights and remedies which the Administrative Agent and the other Guaranteed Parties has or may have against, the General Partner, the Subsidiary Guarantors or any third party; and the Guarantor further waives any defense arising by reason of any disability or other defense (other than the defense that the Guaranteed Obligations shall have been fully and finally performed and indefeasibly paid in full in cash) of the General Partner or the Subsidiary Guarantors or by reason of the cessation from any cause whatsoever of the liability of the General Partner or the Subsidiary Guarantors in respect thereof;
(iv) (a) any rights to assert against the Administrative Agent and the other Guaranteed Parties any defense (legal or equitable), set-off, counterclaim, or claim which the Guarantor may now or at any time hereafter have against the General Partner, the Subsidiary Guarantors or any other party liable to the Administrative Agent and the other Guaranteed Parties unless due to the
gross negligence or willful misconduct of the Administrative Agent or such Guaranteed Party as determined by a court of competent jurisdiction in a final non-appealable judgment
; (b) any defense, set-off, counterclaim, or claim, of any kind or nature, arising directly or indirectly from the present or future lack of sufficiency, validity, or enforceability of the Guaranteed Obligations; (c) any defense the Guarantor has to performance hereunder, and any right the Guarantor has to be exonerated, arising by reason of: (1) the impairment or suspension of the Administrative Agent's and the other Guaranteed Parties' rights or remedies against the other guarantor of the Guaranteed Obligations; (2) the alteration by the Administrative Agent and the other Guaranteed Parties of the Guaranteed Obligations; (3) any discharge of the obligations of the General Partner or the Subsidiary Guarantors to the Administrative Agent and the other Guaranteed Parties by operation of law as a result of the Administrative Agent's and the other Guaranteed Parties' intervention or omission; or (4) the acceptance by the Administrative Agent and the other Guaranteed Parties of anything in partial satisfaction of the Guaranteed Obligations;
and (d) the benefit of any statute of limitations affecting the Guarantor's liability hereunder or the enforcement thereof, and any act which shall defer or delay the operation of any statute of limitations applicable to the Guaranteed Obligations shall similarly operate to defer or delay the operation of such statute of limitations applicable to the Guarantor's liability hereunder; and
(v) any defense arising by reason of or deriving from (a) any claim or defense based upon an election of remedies by the Administrative Agent and the Guaranteed Parties; or (b) any election by the Administrative Agent and the other Guaranteed Parties under the Bankruptcy Code, to limit the amount of its claim against the Guarantor.
SECTION 6.
Subordination of Subrogation; Subordination of Intercompany Indebtedness
.
(a)
Subordination of Subrogation
. Until the Guaranteed Obligations have been fully and finally performed and indefeasibly paid in full in cash (other than Unliquidated Obligations), the Guarantor (i) shall have no right of subrogation with respect to such Guaranteed Obligations and (ii) waives any right to enforce any remedy which the Issuing Bank, any of the Guaranteed Parties or the Administrative Agent now have or may hereafter have against the Borrower, the General Partner, any endorser or any guarantor of all or any part of the Guaranteed Obligations or any other Person. Should the Guarantor have the right, notwithstanding the foregoing, to exercise its subrogation rights, the Guarantor hereby expressly and irrevocably (A) subordinates any and all rights at law or in equity to subrogation, reimbursement, exoneration, contribution, indemnification or set off that the Guarantor may have to the payment in full in cash of the Guaranteed Obligations until the Guaranteed Obligations are indefeasibly paid in full in cash (other than Unliquidated Obligations) and (B) waives any and all defenses available to a surety, guarantor or accommodation co-obligor until the Guaranteed Obligations are indefeasibly paid in full in cash (other than Unliquidated Obligations that have not yet arisen). The Guarantor acknowledges and agrees that this subordination is intended to benefit the Administrative Agent and the Guaranteed Parties and shall not limit or otherwise affect the Guarantor's liability hereunder or the enforceability of this Guaranty, and that the Administrative Agent, the Guaranteed Parties and their respective successors and assigns are intended third party beneficiaries of the waivers and agreements set forth in this Section 6(a).
(b)
Subordination of Intercompany Indebtedness
. The Guarantor agrees that any and all claims of the Guarantor against the Borrower, the General Partner or any Subsidiary Guarantor (each an “Obligor”) with respect to any “Intercompany Indebtedness” (as hereinafter defined), any endorser, obligor or any other guarantor of all or any part of the Guaranteed Obligations, or against any of its properties shall be subordinate and subject in right of payment to the prior payment, in full and in cash, of all Guaranteed Obligations; provided that, as long as no Event of Default has occurred and is continuing, the Guarantor may receive payments of principal and interest from any Obligor with respect to Intercompany Indebtedness. Notwithstanding any right of the Guarantor to ask, demand, sue for, take or receive any payment from any Obligor, all rights, liens and security interests of the Guarantor, whether now or hereafter arising and howsoever existing, in any assets of any other Obligor shall be and are subordinated to the rights of the Guaranteed Parties and the Administrative Agent in those assets. The Guarantor shall not have any right to possession of any such asset or to foreclose upon any such asset, whether by judicial action or otherwise, unless and until all of the Guaranteed Obligations shall have been fully paid and satisfied (in cash) and all financing arrangements pursuant to any Loan Document have been terminated. If all or any part of the assets of any Obligor, or the proceeds thereof, are subject to any distribution, division or application to the creditors of such Obligor, whether partial or complete, voluntary or involuntary, and whether by reason of liquidation, bankruptcy, arrangement, receivership, assignment for the benefit of creditors or any other action or proceeding, or if the business of any such Obligor is dissolved or if substantially all of the assets of any such Obligor are sold, then, and in any such event (such events being herein referred to as an “
Insolvency Event
”), any payment or distribution of any
kind or character, either in cash, securities or other property, which shall be payable or deliverable upon or with respect to any indebtedness of any Obligor to the Guarantor (“
Intercompany Indebtedness
”) shall be paid or delivered directly to the Administrative Agent for application on any of the Guaranteed Obligations, due or to become due, until such Guaranteed Obligations shall have first been fully paid and satisfied (in cash). Should any payment, distribution, security or instrument or proceeds thereof be received by the Guarantor upon or with respect to the Intercompany Indebtedness after any Insolvency Event and prior to the satisfaction of all of the Guaranteed Obligations and the termination of all financing arrangements pursuant to any Loan Document among the Borrower or the General Partner and the Guaranteed Parties, the Guarantor shall receive and hold the same in trust, as trustee, for the benefit of the Guaranteed Parties and shall forthwith deliver the same to the Administrative Agent, for the benefit of the Guaranteed Parties, in precisely the form received (except for the endorsement or assignment of the Guarantor where necessary), for application to any of the Guaranteed Obligations, due or not due, and, until so delivered, the same shall be held in trust by the Guarantor as the property of the Guaranteed Parties. If the Guarantor fails to make any such endorsement or assignment to the Administrative Agent, the Administrative Agent or any of its officers or employees is irrevocably authorized to make the same. The Guarantor agrees that until the Guaranteed Obligations (other than the Unliquidated Obligations) have been paid in full (in cash) and satisfied and all financing arrangements pursuant to any Loan Document among the Borrower or the General Partner and the Guaranteed Parties have been terminated, the Guarantor will not assign or transfer to any Person (other than the Administrative Agent) any claim the Guarantor has or may have against any Obligor.
SECTION 7.
[
Reserved
]
.
SECTION 8.
Limitation of Guaranty
. Notwithstanding any other provision of this Guaranty, the amount guaranteed by the Guarantor hereunder shall be limited to the extent, if any, required so that its obligations hereunder shall not be subject to avoidance under Section 548 of the Bankruptcy Code or under any applicable state Uniform Fraudulent Transfer Act, Uniform Fraudulent Conveyance Act or similar statute or common law. In determining the limitations, if any, on the amount of the Guarantor's obligations hereunder pursuant to the preceding sentence, it is the intention of the parties hereto that any rights of subrogation, indemnification or contribution which the Guarantor may have under this Guaranty, any other agreement or applicable law shall be taken into account.
SECTION 9.
Stay of Acceleration
. If acceleration of the time for payment of any amount payable by the Borrower or the General Partner under the Credit Agreement or any other Loan Document is stayed upon the insolvency, bankruptcy or reorganization of the Borrower, the General Partner or any of their respective Affiliates, all such amounts otherwise subject to acceleration under the terms of the Credit Agreement or any other Loan Document shall nonetheless be payable by the Guarantor hereunder forthwith on demand by the Administrative Agent.
SECTION 10.
Notices
. All notices, requests and other communications to any party hereunder shall be given in the manner prescribed in Section 13.1. of the Credit Agreement with respect to the Administrative Agent at its notice address therein and, with respect to the Guarantor, in the care of the Borrower at the address of the Borrower set forth in the Credit Agreement, or such other address or telecopy number as such party may hereafter specify for such purpose in accordance with the provisions of Section 13.1. of the Credit Agreement.
SECTION 11.
No Waivers
. No failure or delay by the Administrative Agent or any Guaranteed Party in exercising any right, power or privilege hereunder shall operate as a waiver thereof nor shall any single or partial exercise thereof preclude any other or further exercise thereof or the exercise of any other right, power or privilege. The rights and remedies provided in this Guaranty, the Credit Agreement and the other Loan Documents shall be cumulative and not exclusive of any rights or remedies provided by
law.
SECTION 12.
Successors and Assigns
. This Guaranty is for the benefit of the Administrative Agent and the Guaranteed Parties and their respective successors and permitted assigns,
provided
, that the Guarantor shall not have any right to assign its rights or obligations hereunder without the consent of the Administrative Agent, and any such assignment in violation of this Section 12 shall be null and void; and in the event of an assignment of any amounts payable under the Credit Agreement or the other Loan Documents in accordance with the respective terms thereof, the rights hereunder, to the extent applicable to the indebtedness so assigned, may be transferred with such indebtedness. This Guaranty shall be binding upon the Guarantor and its successors and assigns.
SECTION 13.
Changes in Writing
. Other than in connection with the addition of additional Subsidiaries, which become parties hereto by executing a Guaranty Supplement hereto in the form attached as
Annex I
, neither this Guaranty nor any provision hereof may be changed, waived, discharged or terminated orally, but only in writing signed by the Guarantor and the Administrative Agent.
SECTION 14.
Governing Law; Jurisdiction
.
(a) THIS GUARANTY
SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO CONTRACTS EXECUTED, AND TO BE FULLY PERFORMED, IN SUCH STATE
.
(b) EACH PARTY HERETO ACKNOWLEDGES THAT ANY DISPUTE OR CONTROVERSY BETWEEN THE GUARANTOR OR THE ADMINISTRATIVE AGENT WOULD BE BASED ON DIFFICULT AND COMPLEX ISSUES OF LAW AND FACT AND WOULD RESULT IN DELAY AND EXPENSE TO THE PARTIES. ACCORDINGLY, TO THE EXTENT PERMITTED BY APPLICABLE LAW, THE ADMINISTRATIVE AGENT AND THE GUARANTOR HEREBY WAIVES ITS RIGHT TO A TRIAL BY JURY IN ANY ACTION OR PROCEEDING OF ANY KIND OR NATURE IN ANY COURT OR TRIBUNAL IN WHICH AN ACTION MAY BE COMMENCED BY OR AGAINST ANY PARTY HERETO ARISING OUT OF THIS GUARANTY, THE CREDIT AGREEMENT, THE NOTES, OR ANY OTHER LOAN DOCUMENT OR THE FEE LETTER OR BY REASON OF ANY OTHER SUIT, CAUSE OF ACTION OR DISPUTE WHATSOEVER BETWEEN OR AMONG THE BORROWER, THE GUARANTOR, THE GENERAL PARTNER, THE SUBSIDIARY GUARANTORS, THE ADMINISTRATIVE AGENT, THE ISSUING BANK OR ANY OF THE LENDERS OF ANY KIND OR NATURE.
(c) THE GUARANTOR IRREVOCABLY AND UNCONDITIONALLY AGREES THAT IT WILL NOT COMMENCE ANY ACTION, LITIGATION OR PROCEEDING OF ANY KIND OR DESCRIPTION, WHETHER IN LAW OR EQUITY, WHETHER IN CONTRACT OR IN TORT OR OTHERWISE, AGAINST THE ADMINISTRATIVE AGENT, ANY LENDER, THE ISSUING BANK, OR ANY RELATED PARTY OF THE FOREGOING IN ANY WAY RELATING TO THIS GUARANTY OR ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS RELATING HERETO OR THERETO, IN ANY FORUM OTHER THAN THE COURTS OF THE STATE OF NEW YORK 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, AND EACH OF THE PARTIES HERETO IRREVOCABLY AND UNCONDITIONALLY
SUBMITS TO THE JURISDICTION OF SUCH COURTS AND AGREES THAT ALL CLAIMS IN RESPECT OF ANY SUCH ACTION, LITIGATION OR PROCEEDING MAY BE HEARD AND DETERMINED IN SUCH NEW YORK STATE COURT OR, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, IN SUCH FEDERAL COURT. EACH OF THE PARTIES HERETO AGREES THAT A FINAL, NON-APPEALABLE JUDGMENT IN ANY SUCH ACTION, LITIGATION 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 OR IN ANY OTHER LOAN DOCUMENT SHALL AFFECT ANY RIGHT THAT THE ADMINISTRATIVE AGENT, ANY LENDER OR THE ISSUING BANK 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. EACH PARTY FURTHER WAIVES ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH ACTION OR PROCEEDING IN ANY SUCH COURT OR THAT SUCH ACTION OR PROCEEDING WAS BROUGHT IN AN INCONVENIENT FORUM AND EACH AGREES NOT TO PLEAD OR CLAIM THE SAME. THE CHOICE OF FORUM SET FORTH IN THIS SECTION SHALL NOT BE DEEMED TO PRECLUDE THE BRINGING OF ANY ACTION BY THE ADMINISTRATIVE AGENT, THE ISSUING BANK OR ANY LENDER OR THE ENFORCEMENT BY THE ADMINISTRATIVE AGENT, THE ISSUING BANK OR ANY LENDER OF ANY JUDGMENT OBTAINED IN SUCH FORUM IN ANY OTHER APPROPRIATE JURISDICTION.
(d) THE GUARANTOR HEREBY WAIVES PERSONAL SERVICE OF THE SUMMONS AND COMPLAINT, OR OTHER PROCESS OR PAPERS ISSUED THEREIN, AND AGREES THAT SERVICE OF SUCH SUMMONS AND COMPLAINT, OR OTHER PROCESS OR PAPERS MAY BE MADE BY REGISTERED OR CERTIFIED MAIL ADDRESSED TO THE BORROWER AT ITS ADDRESS FOR NOTICES PROVIDED FOR IN THE CREDIT AGREEMENT. SHOULD THE GUARANTOR FAIL TO APPEAR OR ANSWER ANY SUMMONS, COMPLAINT, PROCESS OR PAPERS SO SERVED WITHIN THIRTY (30) DAYS AFTER THE MAILING THEREOF, THE GUARANTOR SHALL BE DEEMED IN DEFAULT AND AN ORDER AND/OR JUDGMENT MAY BE ENTERED AGAINST IT AS DEMANDED OR PRAYED FOR IN SUCH SUMMONS, COMPLAINT, PROCESS OR PAPERS.
(e)
THE PROVISIONS OF THIS SECTION HAVE BEEN CONSIDERED BY EACH PARTY WITH THE ADVICE OF COUNSEL AND WITH A FULL UNDERSTANDING OF THE LEGAL CONSEQUENCES THEREOF, AND SHALL SURVIVE THE PAYMENT OF THE LOANS AND ALL OTHER GUARANTEED OBLIGATIONS, THE TERMINATION OR EXPIRATION OF ALL LETTERS OF CREDIT, THE TERMINATION OF THE CREDIT AGREEMENT AND THE TERMINATION OF THIS GUARANTY
.
SECTION 15.
No Strict Construction
. The parties hereto have participated jointly in the negotiation and drafting of this Guaranty. In the event an ambiguity or question of intent or interpretation arises, this Guaranty shall be construed as if drafted jointly by the parties hereto and no presumption or
burden of proof shall arise favoring or disfavoring any party by virtue of the authorship of any provisions of this Guaranty.
SECTION 16.
Taxes; Expenses of Enforcement, Etc.
(a)
Taxes
. All payments by the Guarantor of principal of, and interest on, the Loans and all other Obligations shall be made free and clear of and without deduction for any Taxes. If any withholding or deduction from any payment to be made by the Guarantor hereunder is required in respect of any Taxes pursuant to any Applicable Law, then the Guarantor will:
(i)
pay directly to the relevant Governmental Authority the full amount required to be so withheld or deducted;
(ii)
promptly forward to the Administrative Agent an official receipt or other documentation satisfactory to the Administrative Agent evidencing such payment to such Governmental Authority; and
(iii)
pay to the Administrative Agent for its account or the account of the applicable Lender or the Issuing Bank, as the case may be, such additional amount or amounts as is necessary to ensure that the net amount actually received by the Administrative Agent, the Issuing Bank or such Lender will equal the full amount that the Administrative Agent, the Issuing Bank or such Lender would have received had no such withholding or deduction been required.
(iv)
If the Guarantor fails to pay any Taxes when due to the appropriate Governmental Authority or fails to remit to the Administrative Agent, for its account or the account of the Issuing Bank or respective Lender, as the case may be, the required receipts or other required documentary evidence, the Guarantor shall indemnify the Administrative Agent, the Issuing Bank and the Lenders for any incremental Taxes, interest or penalties that may become payable by the Administrative Agent, the Issuing Bank or any Lender as a result of any such failure.
(v)
By accepting the benefits hereof, each Lender agrees that it will comply with Section 3.10.(c) of the Credit Agreement.
(b) The Guarantor agrees to reimburse the Guaranteed Parties for any reasonable costs and out-of-pocket expenses (including attorneys' fees) paid or incurred by any Guaranteed Party in connection with the collection and enforcement of the Guaranteed Obligations.
SECTION 17.
Setoff
. In addition to any rights now or hereafter granted under any of the other Loan Documents or Applicable Law and not by way of limitation of any such rights, the Guarantor hereby authorizes each Guaranteed Party and each Participant, at any time while an Event of Default exists, without any prior notice to the Guarantor or to any other Person, any such notice being hereby expressly waived, but in the case of a Lender, the Issuing Bank or a Participant subject to receipt of the prior written consent of the Administrative Agent and Requisite Lenders, exercised in their sole discretion, to set-off and to appropriate and to apply any and all deposits (general or special, including, but not limited to, indebtedness evidenced by certificates of deposit, whether matured or unmatured) and any other indebtedness at any time held or owing by the Administrative Agent, the Issuing Bank, such Lender or such Participant or any affiliate of the Administrative Agent, the Issuing Bank, or such Lender to or for the credit or the account of the Guarantor against and on account of any of the Guaranteed Obligations, although such obligations shall be contingent or unmatured. The Guarantor agrees, to the fullest extent permitted by Applicable Law, that any Participant may exercise rights of setoff or
counterclaim and other rights with respect to its participation as fully as if such Participant were a direct creditor of the Guarantor in the amount of such participation.
SECTION 18.
Financial Information
. The Guarantor hereby assumes responsibility for keeping itself informed of the financial condition of the Borrower, the General Partner, the Subsidiary Guarantors and any and all endorsers and/or other guarantors of all or any part of the Guaranteed Obligations, and of all other circumstances bearing upon the risk of nonpayment of the Guaranteed Obligations, or any part thereof, that diligent inquiry would reveal, and the Guarantor hereby agrees that none of the Guaranteed Parties or the Administrative Agent shall have any duty to advise the Guarantor of information known to any of them regarding such condition or any such circumstances. In the event any Guaranteed Party or the Administrative Agent, in its sole discretion, undertakes at any time or from time to time to provide any such information to the Guarantor, such Guaranteed Party or the Administrative Agent shall be under no obligation (i) to undertake any investigation not a part of its regular business routine, (ii) to disclose any information which such Guaranteed Party or the Administrative Agent, pursuant to accepted or reasonable commercial finance or banking practices, wishes to maintain confidential or (iii) to make any other or future disclosures of such information or any other information to the Guarantor.
SECTION 19.
Severability
. Wherever possible, each provision of this Guaranty shall be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Guaranty shall be prohibited by or invalid under such law, such provision shall be ineffective to the extent of such prohibition or invalidity without invalidating the remainder of such provision or the remaining provisions of this Guaranty.
SECTION 20.
Merger
. This Guaranty represents the final agreement of the Guarantor with respect to the matters contained herein and may not be contradicted by evidence of prior or contemporaneous agreements, or subsequent oral agreements, between the Guarantor and any Guaranteed Party or the Administrative Agent.
SECTION 21.
Headings
. Section headings in this Guaranty are for convenience of reference only and shall not govern the interpretation of any provision of this Guaranty.
SECTION 22.
[
Reserved
]
.
SECTION 23.
AMENDMENT, RESTATEMENT AND CONSOLIDATION; NO NOVATION
. THE EXISTING GUARANTY IS BEING AMENDED, RESTATED AND CONSOLIDATED IN ITS ENTIRETY BY THIS GUARANTY FOR THE CONVENIENCE OF THE PARTIES. THIS GUARANTY MERELY AMENDS, MODIFIES, RESTATES AND CONSOLIDATES THE OBLIGATIONS EVIDENCED BY THE EXISTING GUARANTY AND DOES NOT CONSTITUTE, AND IT IS THE EXPRESS INTENT OF THE PARTIES HERETO THAT THIS GUARANTY DOES NOT EFFECT, A NOVATION OF THE EXISTING OBLIGATIONS OF THE GUARANTOR UNDER THE EXISTING GUARANTY. ALL SUCH OBLIGATIONS CONTINUE TO REMAIN OUTSTANDING AND EVIDENCED BY THIS GUARANTY. THE AMENDMENT, RESTATEMENT AND CONSOLIDATION EFFECTED HEREBY SHALL BE DEEMED TO HAVE PROSPECTIVE APPLICATION ONLY FROM AND AFTER THE EFFECTIVE DATE, UNLESS OTHERWISE EXPRESSLY STATED HEREIN.
[
SIGNATURE PAGES TO FOLLOW
]
IN WITNESS WHEREOF, the Guarantor has caused this Guaranty to be duly executed by its authorized officer as of the day and year first above written.
|
|
|
|
CBL & Associates Properties, Inc.
By:______________________________
Name:
Title:
|
Acknowledged and Agreed to:
WELLS FARGO BANK, NATIONAL ASSOCIATION, as Administrative Agent
By:__________________________________
Name:
Title:
EXHIBIT H
Form of
[
AMENDED AND RESTATED
]
REVOLVING NOTE
CBL & ASSOCIATES
LIMITED PARTNERSHIP
$______________
_________, 20__
FOR VALUE RECEIVED, the undersigned, CBL & Associates Limited Partnership (the “Borrower”) hereby unconditionally promises to pay to the order of ___________________________ (the “Lender”), in care of Wells Fargo Bank, National Association, as Administrative Agent (the “Administrative Agent”), to Wells Fargo Bank, National Association, 123 North Wacker Drive, Suite 1900, Chicago IL, 60606, or at such other address as may be specified by the Administrative Agent to the Borrower, the principal sum of ___________________ AND ___/100 DOLLARS ($_____________), or such lesser amount as may be the then outstanding and unpaid balance of all Revolving Loans made by the Lender to the Borrower pursuant to, and in accordance with the terms of, the Credit Agreement.
The Borrower further agrees to pay interest at said office, in like money, on the unpaid principal amount owing hereunder from time to time on the dates and at the rates and at the times specified in the Credit Agreement.
This
[
Amended and Restated
]
Revolving Note (this “Note”) is one of the “Revolving Notes” referred to in the Third Amended and Restated Credit Agreement dated as of November 13, 2012 (as amended, restated, supplemented or otherwise modified from time to time, the “Credit Agreement”), by and among the Borrower, the financial institutions party thereto and their assignees under Section 13.6. thereof, the Administrative Agent, and the other parties thereto, and is subject to, and entitled to, all provisions and benefits thereof. Capitalized terms used herein and not defined herein shall have the respective meanings given to such terms in the Credit Agreement. The Credit Agreement, among other things, (a) provides for the making of Revolving Loans by the Lender to the Borrower from time to time in an aggregate amount not to exceed at any time outstanding the Dollar amount first above mentioned, (b) permits the prepayment of the Loans by the Borrower subject to certain terms and conditions and (c) provides for the acceleration of the Revolving Loans upon the occurrence of certain specified events.
The Borrower hereby waives presentment, demand, protest and notice of any kind. No failure to exercise, and no delay in exercising any rights hereunder on the part of the holder hereof shall operate as a waiver of such rights.
Time is of the essence for this Note.
[This Note is given in replacement of the Revolving Note dated _____ __, 20__, in the original principal amount of $_______ previously delivered to the Lender under the Credit Agreement. THIS NOTE IS NOT INTENDED TO BE, AND SHALL NOT BE
CONSTRUED TO BE, A NOVATION OF ANY OF THE OBIGATIONS OWING UNDER OR IN CONNECTION WITH THE OTHER NOTE.]
1
[
The principal amount of this Note includes the indebtedness heretofore evidenced by that certain Promissory Note issued to the Bank dated November 2, 2009 (the “Existing Note”). This Note is given in substitution for and not in payment of the Existing Note and is in no way intended to constitute a novation of the Borrower's indebtedness which was evidenced by the Existing Note.
]
CBL Holdings I, Inc., Borrower's sole general partner, its successors and assigns (the “General Partner”), shall not be personally liable for the payment of this Note except to the extent set forth in Section 13.21 of the Credit Agreement.
THIS NOTE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO CONTRACTS EXECUTED, AND TO BE FULLY PERFORMED, IN SUCH STATE.
____________________________
1
Language to be included in case of an assignment and need to issue a replacement note to an existing Lender, either because such Lender's Commitment has increased or decreased from what it was initially.
2
IN WITNESS WHEREOF, the undersigned has executed and delivered this Revolving Note under seal as of the date written above.
CBL & ASSOCIATES LIMITED PARTNERSHIP
By:
CBL Holdings I, Inc.,
as General Partner
By: _____________________________
Name:
Title:
3
EXHIBIT I
FORM OF SWINGLINE NOTE
CBL & ASSOCIATES
LIMITED PARTNERSHIP
$________________
___________ ___, 20__
FOR VALUE RECEIVED, the undersigned, CBL & Associates Limited Partnership (the “Borrower”), hereby promises to pay to the order of Wells Fargo Bank, National Association (the “Swingline Lender”) to its address at 123 North Wacker Drive, Suite 1900, Chicago, IL 60606,or at such other address as may be specified by the Swingline Lender to the Borrower, the principal sum of __________________ AND NO/100 DOLLARS ($________________) (or such lesser amount as shall equal the aggregate unpaid principal amount of Swingline Loans made by the Swingline Lender to the Borrower under the Credit Agreement), on the dates and in the principal amounts provided in the Credit Agreement, and to pay interest on the unpaid principal amount owing hereunder, at the rates and on the dates provided in the Credit Agreement.
The date, amount of each Swingline Loan, and each payment made on account of the principal thereof, shall be recorded by the Swingline Lender on its books and, prior to any transfer of this Note, endorsed by the Swingline Lender on the schedule attached hereto or any continuation thereof,
provided
that the failure of the Swingline Lender to made any such recordation or endorsement shall not affect the obligations of the Borrower to make a payment when due of any amount owing under the Credit Agreement or hereunder in respect of the Swingline Loans.
This Note is the “Swingline Note” referred to in the Third Amended and Restated Credit Agreement dated as of November 13, 2012 (as amended, restated, supplemented or otherwise modified from time to time, the “Credit Agreement”), by and among the Borrower, the financial institutions party thereto and their assignees under Section 13.6. thereof, the Administrative Agent, and the other parties thereto, and evidences Swingline Loans made to the Borrower thereunder. Terms used but not otherwise defined in this Note have the respective meanings assigned to them in the Credit Agreement.
The Credit Agreement provides for the acceleration of the maturity of this Note upon the occurrence of certain events and for prepayments of Swingline Loans upon the terms and conditions specified therein.
This Note SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO CONTRACTS EXECUTED, AND TO BE FULLY PERFORMED, IN SUCH STATE.
CBL Holdings I, Inc., Borrower's sole general partner, its successors and assigns (the “General Partner”), shall not be personally liable for the payment of this Note except to the extent set forth in Section 13.21 of the Credit Agreement.
The Borrower hereby waives presentment for payment, demand, notice of demand, notice of non-payment, protest, notice of protest and all other similar notices.
Time is of the essence for this Note.
2
IN WITNESS WHEREOF, the undersigned has executed and delivered this Swingline Note under seal as of the date first written above.
CBL & ASSOCIATES LIMITED PARTNERSHIP
By:
CBL Holdings I, Inc.,
as General Partner
By: _____________________________
Name:
Title:
3
SCHEDULE OF SWINGLINE LOANS
This Note evidences Swingline Loans made under the within-described Credit Agreement to the Borrower, on the dates and in the principal amounts set forth below, subject to the payments and prepayments of principal set forth below:
|
|
|
|
|
|
Date of Loan
|
Principal
Amount of Loan
|
Amount Paid
or Prepaid
|
Unpaid Principal
Amount
|
Notation
Made By
|
4
EXHIBIT J
TRANSFER AUTHORIZER DESIGNATION
(For Disbursement of Loan Proceeds by Funds Transfer)
£
NEW
S
REPLACE PREVIOUS DESIGNATION
£
ADD
£
CHANGE
£
DELETE LINE NUMBER
_____
The following representatives of CBL & Associates Limited Partnership (“Borrower”) are authorized to request the disbursement of Revolving Loans
and initiate funds transfers for Loan Number 101012 dated November 13, 2012 between Wells Fargo Bank, National Association (“Administrative Agent”), the lenders party thereto and Borrower. Administrative Agent is authorized to rely on this Transfer Authorizer Designation until it has received a new Transfer Authorizer Designation signed by Borrower, even in the event that any or all of the foregoing information may have changed.
|
|
|
|
|
|
Name
|
Title
|
Maximum Wire
Amount
|
1.
|
Charles B. Lebovitz
|
Chairman of the Board
|
$600,000,000.00
|
2.
|
Stephen D. Lebovitz
|
President and Chief Executive Officer
|
$600,000,000.00
|
3.
|
Farzana K. Mitchell
|
Executive Vice President - Finance and Chief Financial Officer
|
$600,000,000.00
|
4.
|
Charles A. Willett, Jr.
|
Senior Vice President
|
$600,000,000.00
|
5.
|
|
|
|
|
|
|
|
|
|
Beneficiary Bank and Account Holder Information
|
1.
|
|
|
Transfer Funds to (Receiving Party Account Name):
CBL & Associates Limited Partnership
|
Receiving Party Account Number:
|
Receiving Bank Name, City and State:
First Tennessee Bank, N.A., Memphis, TN
|
Receiving Bank Routing (ABA) Number
084000026
|
Maximum Transfer Amount:
|
|
|
|
|
$600,000,000
|
|
Further Credit Information/Instructions:
Attention: Donna Whitehead at (423) 757-4074
|
2.
|
|
|
Transfer Funds to (Receiving Party Account Name):
|
Receiving Party Account Number:
|
Receiving Bank Name, City and State:
|
Receiving Bank Routing (ABA) Number
|
Maximum Transfer Amount:
|
|
Further Credit Information/Instructions:
|
3.
|
|
|
Transfer Funds to (Receiving Party Account Name):
|
Receiving Party Account Number:
|
Receiving Bank Name, City and State:
|
Receiving Bank Routing (ABA) Number
|
Maximum Transfer Amount:
|
|
Further Credit Information/Instructions:
|
1
Maximum Wire Amount may not exceed the Loan Amount.
3
Date:
_____________________________
|
|
|
|
“BORROWER”
CBL & ASSOCIATES LIMITED PARTNERSHIP, a
Delaware limited partnership
By: CBL Holdings I, Inc., a Delaware corporation,
its sole general partner
By:___________________________________________
Name:_________________________________________
Title:__________________________________________
(CORPORATE SEAL)
|
4
EXHIBIT K
FORM OF COMPLIANCE CERTIFICATE
Reference is made to the Third Amended and Restated Credit Agreement dated as of November 13, 2012 (as amended, restated, supplemented or otherwise modified from time to time, the "Credit Agreement"), by and among CBL & Associates Limited Partnership (the "Borrower"), CBL & Associates Properties, Inc. (the "Parent"), the financial institutions party thereto and their assignees under Section 13.6 thereof (the "Lenders"), Wells Fargo Bank, National Association, as Administrative Agent (the "Administrative Agent"), and the other parties thereto. Capitalized terms used herein, and not otherwise defined herein, have their respective meanings given to them in the Credit Agreement.
Pursuant to Section 9.3 of the Credit Agreement, the undersigned hereby certifies on behalf of the Borrower to the Administrative Agent and the Lenders that:
1.
(a) The undersigned has reviewed the terms of the Credit Agreement and has made a review of the transactions, financial condition and other affairs of the Borrower and its Subsidiaries as of, and during the relevant accounting period ending on, _______________, 20___, and (b) such review has not disclosed the existence during such accounting period, and the undersigned does not have knowledge of the existence, as of the date hereof, of any condition or event constituting a Default or Event of Default except as set forth on
Schedule 2
hereto, which accurately describes the nature of the condition(s) or event(s) that constitute (a) Default(s) or (an) Event(s) of Default and the actions which the Borrower (is taking) (is planning to take) with respect to such condition(s) or event(s).
2.
Schedule 1
attached hereto accurately and completely sets forth the calculations required to establish compliance with Section 10.1 of the Credit Agreement on the date of the financial statements for the accounting period set forth above.
3.
As of the date hereof, (a) no Default or Event of Default exists other than as set forth on
Schedule 2
attached hereto, and (b) the representations and warranties of the Borrower, the Parent and the other Loan Parties contained in the Credit Agreement and the other Loan Documents are true and correct in all material respects, except to the extent such representations or warranties expressly relate solely to an earlier date (in which case such representations and warranties shall have been true and accurate in all material respects (except in the case of a representation or warranty qualified by materiality, in which case such representation or warranty shall be true and correct in all respects) on and as of such earlier date) and except for changes in factual circumstances specifically and expressly permitted under the Credit Agreement or the other Loan Documents.
IN WITNESS WHEREOF, the undersigned has signed this Compliance Certificate on and as of _______________, 20___.
_______________________________________________________
Name: ________________________________________
Title: _________________________________________
Compliance Certificate
Schedule 1
Compliance Certificate
Schedule 2
EXHIBIT 10.23.2
EXECUTION COPY
FIRST AMENDMENT TO
THIRD AMENDED AND RESTATED CREDIT AGREEMENT
THIS FIRST AMENDMENT TO THIRD AMENDED AND RESTATED CREDIT AGREEMENT
(this “Amendment”) is made and entered into as of the 31th day of January, 2013, by and among
CBL & ASSOCIATES LIMITED PARTNERSHIP
, a Delaware limited partnership (hereinafter referred to as “Borrower”),
CBL & ASSOCIATES PROPERTIES, INC.,
a Delaware corporation (hereinafter referred to as the “Parent”), the Lenders party hereto and
WELLS FARGO BANK, NATIONAL ASSOCIATION,
a national banking association, as contractual representative of the Lenders (in such capacity, the “Agent”).
W
I
T
N
E
S
S
E
T
H
:
WHEREAS, Borrower, Parent, Lenders and Agent entered into that certain Third Amended and Restated Credit Agreement dated as of November 13, 2012 (the “Credit Agreement”), pursuant to which the Lenders agreed to extend to Borrower a revolving credit facility (the “Credit Facility”) in the aggregate principal amount of up to Six Hundred Million and No/100 Dollars ($600,000,000.00) at any one time outstanding; and
WHEREAS, Borrower, Parent, Requisite Lenders and Agent desire to modify and amend the Credit Agreement in order to modify certain financial covenants set forth in the Credit Agreement, as more particularly set forth herein.
NOW THEREFORE, for and in consideration of the premises, for Ten and No/100 Dollars ($10.00) in hand paid by the parties to each other, and for other good and valuable consideration, the receipt, adequacy and sufficiency of which are hereby acknowledged by Borrower, Parent, Requisite Lenders, and Agent, Borrower, Parent, Requisite Lenders and Agent do hereby covenant and agree as follows:
1.
Definitions
.
Capitalized terms used herein and not otherwise defined shall have the meanings ascribed to such terms in the Credit Agreement.
2.
Guarantors (Section 8.14.)
.
Section 8.14.(a)
of the Credit Agreement is amended in its entirety as follows:
“(a)
Within five (5) Business Days (or such longer period as the Administrative Agent may reasonably determine) after the end of the calendar month (or, with respect to clause (iv) below, after May 13, 2013) in which (i) any Person became a Material Subsidiary (other than an Excluded Subsidiary) after the Agreement Date, (ii) any Subsidiary of the Borrower (other than an Excluded Subsidiary) became the owner, directly or indirectly, of the equity interests of any other Guarantor, (iii) solely with respect to any Subsidiary (other than an Excluded Subsidiary) that was a Material Subsidiary as of the Agreement Date and in good faith and without the actual knowledge of the Borrower did not become a Guarantor as of the Agreement Date, such Subsidiary was identified as being a Material Subsidiary, (iv) solely with respect to any Material Subsidiary that was not an Excluded Subsidiary but in good faith and with reasonable belief was identified by the Borrower to
be an Excluded Subsidiary as of the Agreement Date and did not become a Guarantor as of the Agreement Date, (v) any Subsidiary that owns an Eligible Property or other asset, the value of which is included in the determination of Unencumbered Asset Value, incurred, acquired or suffered to exist any Recourse Indebtedness of such Subsidiary, and (vi) any Subsidiary executed and delivered a Guaranty of, or otherwise became obligated in respect of, any Indebtedness of the Parent, the Borrower or any Subsidiary of the Borrower, the Borrower shall deliver to the Administrative Agent each of the following in form and substance satisfactory to the Administrative Agent: (a) an Accession Agreement executed by such Subsidiary and (b) to the extent reasonably requested by the Administrative Agent, the items that would have been delivered under subsections (iv) through (viii) and (xvi) of Section 6.1.(a) if such Person had been a Material Subsidiary on the Agreement Date; provided, that promptly (and in any event within five (5) Business Days) upon any Material Subsidiary which is an Excluded Subsidiary ceasing to be subject to the restriction which prevented it from becoming a Guarantor on the Effective Date or delivering an Accession Agreement pursuant to this Section, as the case may be, such Material Subsidiary shall comply with the provisions of this Section.”
3.
Ratio of Unencumbered NOI to Unsecured Interest Expense (Section 10.1.(g))
.
Section 10.1.(g)
of the Credit Agreement is amended in its entirety as follows:
“(g)
Ratio of Unencumbered NOI to Unsecured Interest Expense
. The Parent shall not permit the ratio of (i) Unencumbered NOI for any fiscal quarter (solely for this clause (i), calculated on an accrual basis for such fiscal quarter with respect to property taxes and insurance) to (ii) Unsecured Interest Expense of the Parent and its Subsidiaries determined on a consolidated basis for such fiscal quarter, to be less than 1.75 to 1.00 as of the last day of such fiscal quarter.”
4.
Conditions Precedent
.
Subject to the other terms and conditions hereof, this Amendment shall not become effective until the Agent shall have received each of the following instruments, documents or agreements, each in form and substance satisfactory to the Agent:
(a)
counterparts of this Amendment duly executed and delivered by Borrower, Parent, Agent and the Requisite Lenders; and
(b)
counterparts of the Consent and Reaffirmation attached as Exhibit A hereto duly executed by the Guarantors, consenting to this Amendment and the transactions contemplated hereby.
Upon fulfillment of the foregoing conditions precedent, this Amendment shall become effective as of the date hereof.
5.
Representations and Warranties; No Default
.
Borrower hereby represents and warrants to the Agent and the Lenders that:
(a)
all of Borrower's representations and warranties contained in the Credit Agreement and the other Loan Documents are true and correct in all material respects on and as of the date of Borrower's execution of this Amendment except to the extent that such representations and warranties expressly relate solely to an earlier date (in which case such representations and warranties shall have been true and accurate on and as of such earlier date) and except for changes in factual circumstances specifically and expressly permitted hereunder;
(b)
no Default or Event of Default has occurred and is continuing as of the date of Borrower's execution of this Amendment under any Loan Document;
(c)
Borrower and Parent have the power and authority to enter into this Amendment and to perform all of its obligations hereunder;
(d)
the execution, delivery and performance of this Amendment by Borrower and Parent have been duly authorized by all necessary corporate, partnership or other action;
(e)
the execution and delivery of this Amendment and performance thereof by Borrower and Parent does not and will not violate the Partnership Agreements or other organizational documents of Borrower or Parent or the Certificate of Incorporation, By-laws or other organizational documents of CBL Holdings I, Inc. and does not and will not violate or conflict with any law, order, writ, injunction, or decree of any court, administrative agency or other governmental authority applicable to Borrower, Parent, CBL Holdings I, Inc., or their respective properties; and
(f)
this Amendment and the Consent and Reaffirmation attached as Exhibit A hereto, constitute legal, valid and binding obligations of the parties thereto, in accordance with the respective terms thereof, subject to bankruptcy, insolvency and similar laws of general application affecting the rights and remedies of creditors and, with respect to the availability of the remedies of specific enforcement, subject to the discretion of the court before which any proceeding therefor may be brought.
6.
Expenses
.
Borrower agrees to pay, promptly following demand by the Agent, all reasonable costs, expenses, fees and other charges and expenses actually incurred by the Agent in connection with the negotiation, preparation, execution and delivery of this Amendment.
7.
Defaults Hereunder
.
The breach of any representation, warranty or covenant contained herein or in any document executed in connection herewith, or the failure to observe or comply with any term or agreement contained herein shall constitute a Default or Event of Default under the Credit Agreement (subject to any applicable cure period set forth in the Credit Agreement) and the Agent and the Lenders shall be entitled to exercise all rights and remedies they may have under the Credit Agreement, any other documents executed in connection therewith and applicable law.
8.
References
.
All references in the Credit Agreement and the Loan Documents to the Credit Agreement shall hereafter be deemed to be references to the Credit Agreement as amended hereby and as the same may hereafter be amended from time to time.
9.
Limitation of Agreement
.
Except as especially set forth herein, this Amendment shall not be deemed to waive, amend or modify any term or condition of the Credit Agreement, each of which is hereby ratified and reaffirmed and which shall remain in full force and effect, nor to serve as a consent to any matter prohibited by the terms and conditions thereof.
10.
Counterparts
.
To facilitate execution, this Amendment may be executed in as many counterparts as may be convenient or required. It shall not be necessary that the signature of, or on behalf of, each party, or that the signature of all persons required to bind any party, appear on each counterpart. All counterparts shall collectively constitute a single document. It shall not be necessary in making proof of this document to produce or account for more than a single counterpart containing the respective signatures of, or on behalf of, each of the parties hereto. Any signature page to any counterpart may be detached from such counterpart without impairing the legal effect of the signature thereon and thereafter attached to another counterpart identical thereto having attached to it additional signature pages.
11.
Further Assurances
.
Borrower agrees to take such further action as the Agent or the Lenders shall reasonably request in connection herewith to evidence the amendments herein contained to the Credit Agreement.
12.
Successors and Assigns
.
This Amendment shall be binding upon and inure to the benefit of the successors and permitted assigns of the parties hereto.
13.
Governing Law
.
This Amendment shall be governed by, and construed in accordance with, the laws of the State of New York.
[Signatures Begin on Following Page]
IN WITNESS WHEREOF
, the parties hereto have caused this First Amendment to Third Amended and Restated Credit Agreement to be executed by their authorized officers all as of the day and year first above written.
Borrower:
CBL & ASSOCIATES LIMITED PARTNERSHIP, a Delaware limited partnership
|
|
By:
|
CBL Holdings I, Inc., a Delaware corporation, its sole general partner
|
By:
/s/ Farzana K. Mitchell
_________________________
Name:
Farzana K. Mitchell
_______________________
Title:
_Executive Vice President - Chief Financial Officer
PARENT:
CBL & ASSOCIATES PROPERTIES, INC., a Delaware corporation, solely for the limited purposes set forth in Section 13.22 of the Credit Agreement.
By:
/s/ Farzana K. Mitchell
_________________________
Name:
Farzana K. Mitchell_________________________
Title:
Executive Vice President - Chief Financial Officer
[Signatures Continued on Following Page]
Signature Page to Amendment to
Third Amended and Restated Credit Agreement dated as of November 13, 2012
CBL & Associates Limited Partnership et al
[Signature Page to First Amendment to Third Amended and Restated Credit Agreement
]
WELLS FARGO BANK, NATIONAL ASSOCIATION, as Agent and as a Lender
By:
/s/ Sam Supple____________________
|
|
Name:
|
Sam Supple_____________________
|
Title:
Senior Vice President_____________
[Signatures Continued on Following Page]
Signature Page to Amendment to
Third Amended and Restated Credit Agreement dated as of November 13, 2012
CBL & Associates Limited Partnership et al
[Signature Page to First Amendment to Third Amended and Restated Credit Agreement
]
U.S. BANK NATIONAL ASSOCIATION
By:
/s/ Michael Raarup________________
|
|
Name:
|
Michael Raarup_________________
|
|
|
Title:
|
Senior Vice President_____________
|
[Signatures Continued on Following Page]
Signature Page to Amendment to
Third Amended and Restated Credit Agreement dated as of November 13, 2012
CBL & Associates Limited Partnership et al
[Signature Page to First Amendment to Third Amended and Restated Credit Agreement
]
BANK OF AMERICA, NATIONAL ASSOCIATION
By:
/s/ Christopher Thompson____________
Name:
Christopher Thompson_____________
Title:
Assistant Vice President____________
[Signatures Continued on Following Page]
Signature Page to Amendment to
Third Amended and Restated Credit Agreement dated as of November 13, 2012
CBL & Associates Limited Partnership et al
[Signature Page to First Amendment to Third Amended and Restated Credit Agreement
]
KEYBANK NATIONAL ASSOCIATION
By:
/s/ Michael P. Szuba___________
|
|
Name:
|
Michael P. Szuba____________
|
Title:
Vice President______________
[Signatures Continued on Following Page]
Signature Page to Amendment to
Third Amended and Restated Credit Agreement dated as of November 13, 2012
CBL & Associates Limited Partnership et al
[Signature Page to First Amendment to Third Amended and Restated Credit Agreement
]
JPMORGAN CHASE BANK, N.A.
By:
/s/ Elizabeth Johnson
Title:
Senior Credit Banker
[Signatures Continued on Following Page]
Signature Page to Amendment to
Third Amended and Restated Credit Agreement dated as of November 13, 2012
CBL & Associates Limited Partnership et al
[Signature Page to First Amendment to Third Amended and Restated Credit Agreement
]
PNC BANK, NATIONAL ASSOCIATION
By:
/s/ Alice Endres____________
|
|
Name:
|
Alice Endres_____________
|
Title:
Assistant Vice President____
[Signatures Continued on Following Page]
Signature Page to Amendment to
Third Amended and Restated Credit Agreement dated as of November 13, 2012
CBL & Associates Limited Partnership et al
[Signature Page to First Amendment to Third Amended and Restated Credit Agreement
]
REGIONS BANK
By:
/s/ Lori Chambers
[Signatures Continued on Following Page]
Signature Page to Amendment to
Third Amended and Restated Credit Agreement dated as of November 13, 2012
CBL & Associates Limited Partnership et al
[Signature Page to First Amendment to Third Amended and Restated Credit Agreement
]
ROYAL BANK OF CANADA
By:
/s/ Brian Gross
Name:
Brian Gross
Title:
Authorized Sigantory
[Signatures Continued on Following Page]
Signature Page to Amendment to
Third Amended and Restated Credit Agreement dated as of November 13, 2012
CBL & Associates Limited Partnership et al
[Signature Page to First Amendment to Third Amended and Restated Credit Agreement
]
UNION BANK, N.A.
By:
/s/ Warren H. Li
|
|
Title:
|
V.P Portfolio Management
|
[Signatures Continued on Following Page]
Signature Page to Amendment to
Third Amended and Restated Credit Agreement dated as of November 13, 2012
CBL & Associates Limited Partnership et al
[Signature Page to First Amendment to Third Amended and Restated Credit Agreement
]
BRANCH BANKING AND TRUST COMPANY
By:
/s/ Ahaz A. Armstrong
|
|
Title:
|
Assistant Vice President
|
[Signatures Continued on Following Page]
Signature Page to Amendment to
Third Amended and Restated Credit Agreement dated as of November 13, 2012
CBL & Associates Limited Partnership et al
[Signature Page to First Amendment to Third Amended and Restated Credit Agreement
]
FIFTH THIRD BANK
By:
/s/ John Reynolds
[Signatures Continued on Following Page]
Signature Page to Amendment to
Third Amended and Restated Credit Agreement dated as of November 13, 2012
CBL & Associates Limited Partnership et al
[Signature Page to First Amendment to Third Amended and Restated Credit Agreement
]
RAYMOND JAMES BANK, N.A.
By:
/s/ James M. Armstrong
|
|
Title:
|
Senior Vice President
|
[Signatures Continued on Following Page]
Signature Page to Amendment to
Third Amended and Restated Credit Agreement dated as of November 13, 2012
CBL & Associates Limited Partnership et al
[Signature Page to First Amendment to Third Amended and Restated Credit Agreement
]
MIDFIRST BANK
By:
/s/ Darrin Rigler
[End of Signatures]
Signature Page to Amendment to
Third Amended and Restated Credit Agreement dated as of November 13, 2012
CBL & Associates Limited Partnership et al
EXHIBIT A
CONSENT AND REAFFIRMATION
Each of the undersigned hereby acknowledges receipt of a copy of the foregoing First Amendment to the Third Amended and Restated Credit Agreement dated as of November 13, 2012 (as the same may be amended, restated, supplemented or otherwise modified from time to time, the “
Credit Agreement
”) by and among by and among CBL & ASSOCIATES LIMITED PARTNERSHIP, a Delaware limited partnership (hereinafter referred to as “Borrower”), CBL & ASSOCIATES PROPERTIES, INC., a Delaware corporation (hereinafter referred to as the “Parent”), the Lenders party thereto and WELLS FARGO BANK, NATIONAL ASSOCIATION, a national banking association, as contractual representative of the Lenders (in such capacity, the “Agent”), which First Amendment is dated as of January 31, 2013 (the “
Amendment
”). Capitalized terms used in this Consent and Reaffirmation and not defined herein shall have the meanings given to them in the Credit Agreement.
Without in any way establishing a course of dealing by the Administrative Agent or any Lender, each of the undersigned consents to the Amendment and reaffirms the terms and conditions of the Guaranty (or, in the case of the Parent, the Parent Guaranty) and any other Loan Document executed by it and acknowledges and agrees that the Guaranty (or, in the case of the Parent, the Parent Guaranty) and each and every such Loan Document executed by the undersigned in connection with the Credit Agreement remains in full force and effect and is hereby reaffirmed, ratified and confirmed. All references to the Credit Agreement contained in the above‑referenced documents shall be a reference to the Credit Agreement as so modified by the Amendment and as the same may from time to time hereafter be amended, modified or restated.
Dated: January 31, 2013
[
Signature Pages Follow
]
PARENT:
CBL & Associates Properties, Inc.
By:
/s/ Farzana K. Mitchell
______________________
Farzana K. Mitchell
Executive Vice President - Chief Financial Officer
SUBSIDIARIES:
Acadiana Expansion Parcel, LLC
Acadiana Mall of Delaware, LLC
Alamance Crossing, LLC
Brookfield Square Parcel, LLC
Akron Mall Land, LLC
Columbia Place/Anchor, LLC
CBL/J I, LLC
CBL/J II, LLC
FHM Anchor, LLC
CBL/Huntsville, LLC
CBL/Monroeville I, LLC
CBL/Monroeville II, LLC
CBL/Monroeville III, LLC
Hixson Mall, LLC
Panama City Mall, LLC
CBL/Richland G.P., LLC
Hickory Point-OP Outparcel, LLC
The Shoppes at Panama City, LLC
CBL/Sunrise GP, LLC
CBL/Sunrise Commons GP, LLC
CBL/Sunrise Land, LLC
CBL/Monroeville Expansion I, LLC
CBL/Monroeville Expansion II, LLC
CBL/Monroeville Expansion III, LLC
The Landing at Arbor Place II, LLC
CBL Walden Park, LLC
WNC Shopping Center, LLC
Houston Willowbrook, LLC
CBL El Paso Member, LLC
CBL/Parkdale Mall GP, LLC
CBL/Parkdale, LLC
IV Commons, LLC
Jefferson Mall Company II, LLC
Pearland-OP Parcel 8, LLC
Southpark Mall-DSG, LLC
CBL Gettysburg Member, LLC
CBL-TRS Member I, LLC
CBL/MSC, LLC
CBL/Gulf Coast, LLC
Signature Page to Reaffirmation to First Amendment to
Third Amended and Restated Credit Agreement dated as of November 13, 2012
CBL & Associates Limited Partnership et al
Laurel Park Retail Properties, LLC
Port Orange Holdings II, LLC
By:
CBL & Associates Limited Partnership,
as the chief manager of each of the above listed
limited liability companies
By:
CBL Holdings I, Inc., its general partner
By:
/s/ Farzana K. Mitchell
______________________
Farzana K. Mitchell
Executive Vice President - Chief Financial Officer
Frontier Mall Associates Limited Partnership
Georgia Square Partnership
Georgia Square Associates, Ltd.
CBL/Nashua Limited Partnership
Lakeshore/Sebring Limited Partnership
Madison Plaza Associates, LTD
Madison Square Associates, Ltd.
College Station Partners, Ltd.
Turtle Creek Limited Partnership
Seacoast Shopping Center Limited Partnership
By:
CBL & Associates Limited Partnership,
as the general partner of each of the above listed
limited partnerships
By:
CBL Holdings I, Inc., its general partner
By:
/s/ Farzana K. Mitchell
______________________
Farzana K. Mitchell
Executive Vice President - Chief Financial Officer
CBL RM-Waco, LLC
By: CBL/Richland G.P., LLC, its managing member
CBL SM-Brownsville, LLC
By: CBL/Sunrise GP, LLC, its managing member
By:
CBL & Associates Limited Partnership,
as the chief manager of the managing member
of each of the above listed limited liability companies
By:
CBL Holdings I, Inc., its general partner
By:
/s/ Farzana K. Mitchell
______________________
Farzana K. Mitchell
Executive Vice President - Chief Financial Officer
Signature Page to Reaffirmation to First Amendment to
Third Amended and Restated Credit Agreement dated as of November 13, 2012
CBL & Associates Limited Partnership et al
POM-College Station, LLC
By:
CBL & Associates Limited Partnership,
its managing member
By:
CBL Holdings I, Inc., its general partner
By:
/s/ Farzana K. Mitchell
______________________
Farzana K. Mitchell
Executive Vice President - Chief Financial Officer
River Ridge Mall, LLC
By:
Seacoast Shopping Limited Partnership, its chief manager
By:
CBL & Associates Limited Partnership, its general partner
By:
CBL Holdings I, Inc., its general partner
By:
/s/ Farzana K. Mitchell
______________________
Farzana K. Mitchell
Executive Vice President - Chief Financial Officer
CBL/ Monroeville Partner, L.P.
By:
CBL/Monroeville II, LLC, its general partner
CBL/Monroeville, L.P.
By:
CBL/Monroeville I, LLC, its general partner
Monroeville Anchor Limited Partnership
By:
CBL/Monroeville II, LLC, its general partner
CBL/Sunrise XS Land, L.P.
By:
CBL/Sunrise Land, LLC, its general partner
CBL/Sunrise Commons, L.P.
By:
CBL/Sunrise Commons GP, LLC, its general partner
CBL/Monroeville Expansion, L.P.
By:
CBL/Monroeville Expansion I, LLC, its general partner
CBL/Monroeville Expansion Partner, L.P.
By:
CBL/Monroeville Expansion II, LLC, its general partner
Parkdale Mall Associates, L.P.
By:
CBL/Parkdale, LLC, its general partner
By:
CBL & Associates Limited Partnership,
as the chief manager of the general partner of each
of the above listed limited partnerships
By:
CBL Holdings I, Inc., its general partner
By:
/s/ Farzana K. Mitchell
______________________
Farzana K. Mitchell
Executive Vice President - Chief Financial Officer
Signature Page to Reaffirmation to First Amendment to
Third Amended and Restated Credit Agreement dated as of November 13, 2012
CBL & Associates Limited Partnership et al
CBL/Eastgate I, LLC
By:
CBL/J II, LLC, its chief manager
CBL/Eastgate II, LLC
By:
CBL/J II, LLC, its chief manager
CBL/Old Hickory I, LLC
By:
CBL/J II, LLC, its chief manager
CBL/Old Hickory II, LLC
By:
CBL/J II, LLC, its chief manager
JG Randolph, LLC
By:
CBL/J II, LLC, its chief manager
CBL/Regency I, LLC
By:
CBL/J II, LLC, its chief manager
CBL/Regency II, LLC
By:
CBL/J II, LLC, its chief manager
CBL/Madison I, LLC
By:
CBL/J I, LLC, its chief manager
CBL/Madison II, LLC
By:
CBL/J I, LLC, its chief manager
Parkdale Mall, LLC
By:
CBL/Parkdale Mall GP, LLC, its chief manager
By:
CBL & Associates Limited Partnership,
as the chief manager of the chief manager of each
of the above listed limited liability companies
By:
CBL Holdings I, Inc., its general partner
By:
/s/ Farzana K. Mitchell
______________________
Farzana K. Mitchell
Executive Vice President - Chief Financial Officer
Signature Page to Reaffirmation to First Amendment to
Third Amended and Restated Credit Agreement dated as of November 13, 2012
CBL & Associates Limited Partnership et al
Eastgate Company
By: CBL/Eastgate I, LLC, its general partner
By: CBL/J II, LLC, its chief manager
By: CBL/Eastgate II, LLC its general partner
By: CBL/J II, LLC, its chief manager
Old Hickory Mall Venture
By: CBL/Old Hickory I, its general partner
By: CBL/J II, LLC, its chief manager
By: CBL/Old Hickory II, its general partner
By: CBL/J II, LLC, its chief manager
Racine Joint Venture
By: CBL/Racine I, LLC, its general partner
By: CBL/J II, LLC, its chief manager
By: CBL/Racine II, LLC its general partner
By: CBL/J II, LLC, its chief manager
Madison Joint Venture
By: CBL/Madison I, LLC, its general partner
By: CBL/J I, LLC, its chief manager
By: CBL/Madison II, LLC its general partner
By: CBL/J I, LLC, its chief manager
By:
CBL & Associates Limited Partnership,
as the chief manager of the chief manager of the
general partners of each of the above
listed general partnerships
By:
CBL Holdings I, Inc., its general partner
By:
/s/ Farzana K. Mitchell
______________________
Farzana K. Mitchell
Executive Vice President - Chief Financial Officer
Signature Page to Reaffirmation to First Amendment to
Third Amended and Restated Credit Agreement dated as of November 13, 2012
CBL & Associates Limited Partnership et al
Old Hickory Mall Venture II, LLC
By: Old Hickory Mall Venture, its chief manager
By: CBL/Old Hickory I, LLC, its general partner
By: CBL/J II, LLC, its chief manager
By: CBL/Old Hickory II, LLC, its general partner
By: CBL/J II, LLC, its chief manager
Racine Joint Venture II, LLC
By: Racine Joint Venture, its chief manager
By: CBL/Regency I, LLC, its general partner
By: CBL/J II, LLC, its chief manager
By: CBL/Regency II, LLC, its general partner
By: CBL/J II, LLC, its chief manager
By:
CBL & Associates Limited Partnership,
as the chief manager of the chief manager of the
general partners of the chief manager of each of the above
listed limited liability companies
By:
CBL Holdings I, Inc., its general partner
By:
/s/ Farzana K. Mitchell
______________________
Farzana K. Mitchell
Executive Vice President - Chief Financial Officer
JG Randolph II, LLC
By: JG Randolph, LLC, its chief manager
By: CBL/J II, LLC, its chief manager
By: CBL & Associates Limited Partnership,
its chief manager
By:
CBL Holdings I, Inc., its general partner
By:
/s/ Farzana K. Mitchell
______________________
Farzana K. Mitchell
Executive Vice President - Chief Financial Officer
Signature Page to Reaffirmation to First Amendment to
Third Amended and Restated Credit Agreement dated as of November 13, 2012
CBL & Associates Limited Partnership et al
Bonita Lakes Mall Limited Partnership
By:
CBL/GP III, Inc., its general partner
By:
/s/ Farzana K. Mitchell
______________________
Farzana K. Mitchell
Executive Vice President - Chief Financial Officer
CBL/Low Limited Partnership
Willowbrook Plaza Limited Partnership
By:
CBL/GP, Inc. the general partner of each of the
above listed limited partnerships
By:
/s/ Farzana K. Mitchell
______________________
Farzana K. Mitchell
Executive Vice President - Chief Financial Officer
The Courtyard at Hickory Hollow Limited Partnership
By:
Hickory Hollow Courtyard, Inc., its general partner
By:
/s/ Farzana K. Mitchell
______________________
Farzana K. Mitchell
Executive Vice President - Chief Financial Officer
Harford Mall Business Trust
By:
/s/ Farzana K. Mitchell
______________________
Farzana K. Mitchell
Executive Vice President - Chief Financial Officer
Meridian Mall Limited Partnership
By:
Meridian Mall Company, Inc., its general partner
By:
/s/ Farzana K. Mitchell
______________________
Farzana K. Mitchell
Executive Vice President - Chief Financial Officer
Rivergate Mall Limited Partnership
By:
Rivergate Mall, Inc., its general partner
By:
/s/ Farzana K. Mitchell
______________________
Farzana K. Mitchell
Executive Vice President - Chief Financial Officer
Signature Page to Reaffirmation to First Amendment to
Third Amended and Restated Credit Agreement dated as of November 13, 2012
CBL & Associates Limited Partnership et al
The Village at Rivergate Limited Partnership
By:
The Village at Rivergate, Inc., its general partner
By:
/s/ Farzana K. Mitchell
______________________
Farzana K. Mitchell
Executive Vice President - Chief Financial Officer
Westgate Crossing Limited Partnership
By:
CBL/GP II, Inc., its general partner
By:
/s/ Farzana K. Mitchell
______________________
Farzana K. Mitchell
Executive Vice President - Chief Financial Officer
Signature Page to Reaffirmation to First Amendment to
Third Amended and Restated Credit Agreement dated as of November 13, 2012
CBL & Associates Limited Partnership et al
EXHIBIT 10.24.1
EXECUTION COPY
Loan Number: 5593ZMA
EIGHTH AMENDED AND RESTATED CREDIT AGREEMENT
Dated as of November 13, 2012
by and among
CBL & ASSOCIATES LIMITED PARTNERSHIP,
as Borrower,
CBL & ASSOCIATES PROPERTIES, INC.,
as Parent, solely for the limited purposes
set forth in Section 13.22.,
THE FINANCIAL INSTITUTIONS PARTY HERETO
AND THEIR ASSIGNEES UNDER SECTION 13.6.,
as Lenders,
WELLS FARGO BANK, NATIONAL ASSOCIATION,
as Administrative Agent,
U.S. BANK NATIONAL ASSOCIATION,
as Syndication Agent
and
BANK OF AMERICA, N.A., KEYBANK, NATIONAL ASSOCIATION,
JPMORGAN CHASE BANK, N.A., and PNC BANK NATIONAL ASSOCIATION,
as Documentation Agents
WELLS FARGO SECURITIES, LLC and
U.S. BANK NATIONAL ASSOCIATION,
as Co-Lead Arrangers and Co-Book Runners
|
|
|
|
|
|
TABLE OF CONTENTS
|
|
|
|
Article I.
|
Definitions
|
|
|
Section 1.1.
|
Definitions
|
|
|
Section 1.2.
|
General; References to Central Time
|
|
|
Section 1.3.
|
Financial Attributes of Non-Wholly Owned Subsidiaries
|
|
|
|
|
|
Article II.
|
Credit Facility
|
|
|
Section 2.1.
|
Revolving Loans
|
|
|
Section 2.2.
|
Letters of Credit
|
|
|
Section 2.3.
|
Swingline Loans
|
|
|
Section 2.4.
|
Rates and Payment of Interest on Loans
|
|
|
Section 2.5.
|
Number of Interest Periods.
|
|
|
Section 2.6.
|
Repayment of Loans
|
|
|
Section 2.7.
|
Prepayments
|
|
|
Section 2.8.
|
Late Charges
|
|
|
Section 2.9.
|
Continuation
|
|
|
Section 2.10.
|
Conversion
|
|
|
Section 2.11.
|
Notes
|
|
|
Section 2.12.
|
Voluntary Reductions of the Revolving Commitment
|
|
|
Section 2.13.
|
Extension of Maturity Date
|
|
|
Section 2.14.
|
Expiration or Maturity Date of Letters of Credit Past Maturity Date
|
|
|
Section 2.15.
|
Amount Limitations
|
|
|
Section 2.16.
|
Funds Transfer Disbursements
|
|
|
Section 2.17.
|
Increase in Revolving Commitments
|
|
|
|
|
|
Article III.
|
Payments, Fees and Other General Provisions
|
|
|
Section 3.1.
|
Payments
|
|
|
Section 3.2.
|
Pro Rata Treatment
|
|
|
Section 3.3.
|
Sharing of Payments, Etc
|
|
|
Section 3.4.
|
Several Obligations
|
|
|
Section 3.5.
|
Fees
|
|
|
Section 3.6.
|
Computations
|
|
|
Section 3.7.
|
Usury
|
|
|
Section 3.8.
|
Statements of Account
|
|
|
Section 3.9.
|
Defaulting Lenders
|
|
|
Section 3.10.
|
Taxes; Foreign Lenders
|
|
|
|
|
|
|
Article IV.
|
[Reserved]
|
|
|
|
|
|
|
Article V.
|
Yield Protection, Etc.
|
|
|
Section 5.1.
|
Additional Costs; Capital Adequacy
|
|
|
Section 5.2.
|
Suspension of LIBOR Loans
|
|
|
Section 5.3.
|
Illegality
|
|
|
Section 5.4.
|
Compensation
|
|
|
Section 5.5.
|
Treatment of Affected Loans
|
|
|
Section 5.6.
|
Affected Lenders
|
|
|
|
|
|
|
|
|
Section 5.7.
|
Change of Lending Office
|
|
|
Section 5.8.
|
Assumptions Concerning Funding of LIBOR Loans.
|
|
|
|
|
|
Article VI.
|
Conditions Precedent
|
|
|
Section 6.1.
|
Initial Conditions Precedent.
|
|
|
Section 6.2.
|
Conditions Precedent to All Loans and Letters of Credit.
|
|
|
Section 6.3.
|
Conditions as Covenants.
|
|
|
|
|
|
Article VII.
|
Representations and Warranties
|
|
|
Section 7.1.
|
Representations and Warranties
|
|
|
Section 7.2.
|
Survival of Representations and Warranties, Etc.
|
|
|
|
|
|
|
Article VIII.
|
Affirmative Covenants
|
|
|
Section 8.1.
|
Preservation of Existence and Similar Matters.
|
|
|
Section 8.2.
|
Compliance with Applicable Law.
|
|
|
Section 8.3.
|
Maintenance of Property.
|
|
|
Section 8.4.
|
Conduct of Business.
|
|
|
Section 8.5.
|
Insurance.
|
|
|
Section 8.6.
|
Payment of Taxes and Claims.
|
|
|
Section 8.7.
|
Books and Records; Inspections.
|
|
|
Section 8.8.
|
Use of Proceeds.
|
|
|
Section 8.9.
|
Environmental Matters.
|
|
|
Section 8.10.
|
Further Assurances.
|
|
|
Section 8.11.
|
Material Contracts.
|
|
|
Section 8.12.
|
REIT Status.
|
|
|
Section 8.13.
|
Exchange Listing.
|
|
|
Section 8.14.
|
Guarantors.
|
|
|
|
|
|
Article IX.
|
Information
|
|
|
Section 9.1.
|
Quarterly Financial Statements.
|
|
|
Section 9.2.
|
Year-End Statements.
|
|
|
Section 9.3.
|
Compliance Certificate.
|
|
|
Section 9.4.
|
Other Information.
|
|
|
Section 9.5.
|
Electronic Delivery of Certain Information.
|
|
|
Section 9.6.
|
Public/Private Information.
|
|
|
Section 9.7.
|
USA Patriot Act Notice; Compliance.
|
|
|
|
|
|
|
Article X.
|
Negative Covenants
|
|
|
Section 10.1.
|
Financial Covenants
|
|
|
Section 10.2.
|
Negative Pledge
|
|
|
Section 10.3.
|
Restrictions on Intercompany Transfers
|
|
|
Section 10.4.
|
Merger, Consolidation, Sales of Assets and Other Arrangements
|
|
|
Section 10.5.
|
Plans
|
|
|
Section 10.6.
|
Fiscal Year
|
|
|
Section 10.7.
|
Modifications of Organizational Documents and Material Contracts
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Section 10.8.
|
Subordinated Debt Prepayments; Amendments
|
|
|
Section 10.9.
|
Transactions with Affiliates
|
|
|
Section 10.10.
|
Environmental Matters
|
|
|
Section 10.11.
|
Derivatives Contracts
|
|
|
|
|
|
|
Article XI.
|
Default
|
|
|
Section 11.1.
|
Events of Default
|
|
|
Section 11.2.
|
Remedies Upon Event of Default
|
|
|
Section 11.3.
|
Remedies Upon Default
|
|
|
Section 11.4.
|
Marshaling; Payments Set Aside
|
|
|
Section 11.5.
|
Allocation of Proceeds
|
|
|
Section 11.6.
|
Letter of Credit Collateral Account
|
|
|
Section 11.7.
|
Reserved
|
|
|
Section 11.8.
|
Performance by Administrative Agent
|
|
|
Section 11.9.
|
Rights Cumulative
|
|
|
|
|
|
|
Article XII.
|
The Administrative Agent
|
|
|
Section 12.1.
|
Appointment and Authorization
|
|
|
Section 12.2.
|
Wells Fargo as Lender
|
|
|
Section 12.3.
|
Approvals of Lenders
|
|
|
Section 12.4.
|
Notice of Events of Default
|
|
|
Section 12.5.
|
Administrative Agent's Reliance
|
|
|
Section 12.6.
|
Indemnification of Administrative Agent
|
|
|
Section 12.7.
|
Lender Credit Decision, Etc.
|
|
|
Section 12.8.
|
Successor Administrative Agent
|
|
|
Section 12.9.
|
Titled Agents
|
|
|
|
|
|
|
Article XIII.
|
Miscellaneous
|
|
|
Section 13.1.
|
Notices
|
|
|
Section 13.2.
|
Expenses
|
|
|
Section 13.3.
|
Stamp, Intangible and Recording Taxes
|
|
|
Section 13.4.
|
Setoff
|
|
|
Section 13.5.
|
Litigation; Jurisdiction; Other Matters; Waivers
|
|
|
Section 13.6.
|
Successors and Assigns
|
|
|
Section 13.7.
|
Amendments and Waivers
|
|
|
Section 13.8.
|
Non-Liability of Administrative Agent and Lenders
|
|
|
Section 13.9.
|
Confidentiality
|
|
|
Section 13.10.
|
Indemnification
|
|
|
Section 13.11.
|
Termination; Survival
|
|
|
Section 13.12.
|
Severability of Provisions
|
|
|
Section 13.13.
|
GOVERNING LAW
|
|
|
Section 13.14.
|
Counterparts
|
|
|
Section 13.15.
|
Obligations with Respect to Loan Parties
|
|
|
Section 13.16.
|
Independence of Covenants
|
|
|
Section 13.17.
|
Limitation of Liability
|
|
|
Section 13.18.
|
Entire Agreement
|
|
|
Section 13.19.
|
Construction, Conflict of Terms
|
|
|
|
|
|
|
|
|
|
|
|
|
Section 13.20.
|
Headings
|
|
|
Section 13.21.
|
Limitation of Liability of Borrower's General Partner
|
|
|
Section 13.22.
|
Limited Nature of Parent's Obligations
|
|
|
Section 13.23.
|
Limitation of Liability of Borrower's Directors, Officers, Etc
|
|
|
Section 13.24.
|
AMENDMENT, RESTATEMENT AND CONSOLIDATION; NO NOVATION.
|
|
|
|
|
|
SCHEDULE I
|
Commitments
|
SCHEDULE 1.1.
|
Liens
|
SCHEDULE 7.1.(b)
|
Ownership Structure
|
SCHEDULE 7.1.(f)
|
Occupancy Status of Properties
|
SCHEDULE 7.1.(h)
|
Material Contracts
|
SCHEDULE 7.1.(i)
|
Litigation
|
SCHEDULE 7.1.(r)
|
Affiliate Transactions
|
SCHEDULE 8.14.(c)
|
Parent Guaranties of Indebtedness
|
|
|
|
EXHIBIT A
|
Form of Assignment and Assumption Agreement
|
EXHIBIT B
|
Form of Amended and Restated Guaranty
|
EXHIBIT C
|
Form of Notice of Borrowing
|
EXHIBIT D
|
Form of Notice of Continuation
|
EXHIBIT E
|
Form of Notice of Conversion
|
EXHIBIT F
|
Form of Notice of Swingline Borrowing
|
EXHIBIT G
|
Form of Amended and Restated Parent Guaranty
|
EXHIBIT H
|
Form of Amended and Restated Revolving Note
|
EXHIBIT I
|
Form of Swingline Note
|
EXHIBIT J
|
Form of Transfer Authorizer Designation Form
|
EXHIBIT K
|
Form of Compliance Certificate
|
THIS EIGHTH AMENDED AND RESTATED CREDIT AGREEMENT (this “Agreement”) dated as of November 13, 2012 by and among CBL & ASSOCIATES LIMITED PARTNERSHIP, a limited partnership organized under the laws of the State of Delaware (the “Borrower”), CBL & ASSOCIATES PROPERTIES, INC., a corporation organized under the laws of the State of Delaware (the “Parent”), joining in the execution of this Agreement solely for the limited purposes set forth in Section 13.22., each of the financial institutions initially a signatory hereto together with their successors and assignees under Section 13.6. (the “Lenders”), WELLS FARGO BANK, NATIONAL ASSOCIATION (“Administrative Agent”) and U.S. BANK NATIONAL ASSOCIATION, as Syndication Agent (“Syndication Agent”) and BANK OF AMERICA, N.A., KEYBANK, NATIONAL ASSOCIATION, JPMORGAN CHASE BANK, N.A. and PNC BANK, NATIONAL ASSOCIATION, each as Documentation Agent (each a “Documentation Agent”).
WHEREAS, the Lenders have made available to the Borrower a revolving credit facility on the terms and conditions contained in that certain Seventh Amended and Restated Credit Agreement dated as of September 28, 2009 (as amended and in effect immediately prior to the date hereof, the “Existing Credit Agreement”) by and among the Borrower, Parent, Lenders, and Wells Fargo Bank, National Association, as Administrative Agent;
WHEREAS, the Administrative Agent and the Lenders desire to amend and restate the Existing Credit Agreement in order to make available to the Borrower a $600,000,000 unsecured revolving credit facility, which will include a letter of credit subfacility and a swingline subfacility, on the terms and conditions contained herein.
NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged by the parties hereto, the parties hereto agree that the Existing Credit Agreement is amended and restated in its entirety as follows:
Article I. Definitions
Section 1.1
Definitions.
In addition to terms defined elsewhere herein, the following terms shall have the following meanings for the purposes of this Agreement:
“
Accession Agreement
” means a Guaranty Supplement substantially in the form of Annex I to the Guaranty.
“
Additional Costs
” has the meaning given that term in Section 5.1.(b).
“
Adjusted Total Asset Value
”
means Total Asset Value determined exclusive of assets that are owned by Excluded Subsidiaries or Unconsolidated Affiliates.
“
Administrative Agent
” means Wells Fargo Bank, National Association, as contractual representative of the Lenders under this Agreement, or any successor Administrative Agent appointed pursuant to Section 12.8.
“
Administrative Questionnaire
” means the Administrative Questionnaire completed by each Lender and delivered to the Administrative Agent in a form supplied by the Administrative Agent to the Lenders from time to time.
“
Affected Lender
” has the meaning given that term in Section 5.6.
“
Affiliate
” means, with respect to any Person, (a) in the case of any such Person which is a partnership or limited liability company, any partner or member in such partnership or limited liability company, respectively, (b) any other Person which is directly or indirectly controlled by, controls or is under common control with such Person or one or more of the Persons referred to in the preceding clause (a), (c) any other Person who is an officer, director, trustee or employee of, or partner in, such Person or any Person referred to in the preceding clauses (a) and (b), (d) any other Person who is a member of the immediate family of such Person or of any Person referred to in the preceding clauses (a) through (c), and (e) any other Person that is a trust solely for the benefit of one or more Persons referred to in clause (d) and of which such Person is sole trustee;
provided
,
however
, in no event shall the Administrative Agent, the Issuing Bank or any Lender or any of its or their respective Affiliates be an Affiliate of Borrower, Parent or any other Loan Party. For purposes of this definition, “control” (including with correlative meanings, the terms “controlling”, “controlled by” and “under common control with”) means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a Person, whether through the ownership of voting securities, by contract or otherwise. The Affiliates of a Person shall include any officer or director of such Person. In no event shall the Administrative Agent, the Issuing Bank or any Lender be deemed to be an Affiliate of the Borrower, Parent or any other Loan Party.
“
Agreement Date
” means the date as of which this Agreement is dated.
“
Applicable Facility Fee
” means the percentage set forth in the table below corresponding to the Level at which the “Applicable Margin” is determined in accordance with the definition thereof upon the occurrence of a Credit Rating Election Event:
|
|
|
Level
|
Facility Fee
|
1
|
0.150%
|
2
|
0.175%
|
3
|
0.225%
|
4
|
0.300%
|
5
|
0.350%
|
Any change in the applicable Level at which the Applicable Margin is determined shall result in a corresponding and simultaneous change in the Applicable Facility Fee. The provisions of this definition shall be subject to Section 2.4.(d).
“
Applicable Law
” means all applicable provisions of constitutions, statutes, treaties, rules, guidelines, administrative or judicial precedents or authorities, regulations and orders of any Governmental Authority, including all orders and decrees of all courts, tribunals and arbitrators.
“
Applicable Margin
” means the percentage rate set forth below corresponding to the ratio of Total Indebtedness to Total Asset Value as determined in accordance with Section 10.1.(b):
|
|
|
|
Level
|
Ratio of Total Indebtedness to Total Asset Value
|
Applicable Margin
|
1
|
Less than 0.45 to 1.00
|
1.55%
|
2
|
Greater than or equal to 0.45 to 1.00 but less than 0.50 to 1.00
|
1.70%
|
3
|
Greater than or equal to 0.50 to 1.00 but less than 0.55 to 1.00
|
1.85%
|
4
|
Greater than or equal to 0.55 to 1.00
|
2.10%
|
The Applicable Margin for Loans shall be determined by the Administrative Agent from time to time, based on the ratio of Total Indebtedness to Total Asset Value as set forth in the Compliance Certificate most recently delivered by the Borrower pursuant to Section 9.3. Any adjustment to the Applicable Margin shall be effective as of the first day of the calendar month immediately following the month during which the Borrower delivers to the Administrative Agent the applicable Compliance Certificate pursuant to Section 9.3.; provided however, if the date for delivery of the Compliance Certificate falls on a day that is not a Business Day, and the Compliance Certificate is delivered on the next Business Day occurring thereafter and such Business Day is in the month following the month in which the due date occurs, the adjustment to the Applicable Margin shall be effective as of the date the Compliance Certificate is delivered. If the Borrower fails to deliver a Compliance Certificate pursuant to Section 9.3., and does not cure such failure within ten (10) days after notice from the Administrative Agent (which notice may be given to the Executive Vice President - Chief Financial Officer by email or telephone), the Applicable Margin shall equal the percentages corresponding to Level 4 until the first day of the calendar month immediately following the month that the required Compliance Certificate is delivered. Notwithstanding the foregoing, for the period from the Effective Date through but excluding the date on which the Administrative Agent first determines the Applicable Margin for Loans as set forth above, the Applicable Margin shall be determined based on Level 3. Thereafter, such Applicable Margin shall be adjusted from time to time as set forth in this definition. The provisions of this definition shall be subject to Section 2.4.(d).
Upon the occurrence of a Credit Rating Election Event and thereafter, the Applicable Margin shall mean the percentage rate set forth in the table below corresponding to the level (each, a “Level”) into which the Borrower's Credit Rating then falls:
|
|
|
|
Level
|
Credit Rating
|
Applicable Margin
|
1
|
A-/A3 or better
|
1.000%
|
2
|
BBB+/Baa1
|
1.075%
|
3
|
BBB/Baa2
|
1.175%
|
|
|
|
|
4
|
BBB-/Baa3
|
1.400%
|
5
|
Lower than BBB-/Baa3
|
1.750%
|
Any change in the Borrower's Credit Rating which would cause it to move to a different Level shall be effective as of the first day of the first calendar month immediately following receipt by the Administrative Agent of written notice delivered by the Borrower in accordance with Section 9.4.(l) that the Borrower's Credit Rating has changed; provided, however, if the Borrower has not delivered the notice required by such Section but the Administrative Agent becomes aware that the Borrower's Credit Rating has changed, then the Administrative Agent may, in its sole discretion, adjust the Level effective as of the first day of the first calendar month following the date the Administrative Agent becomes aware that the Borrower's Credit Rating has changed. During any period that the Borrower has received two (2) Credit Ratings that are not equivalent, the Applicable Margin shall be determined based on the Level corresponding to the higher of such two (2) Credit Ratings. During any period for which the Borrower 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 the Borrower has not received a Credit Rating from any Rating Agency, and provided a Credit Rating Election Event has occurred, the Applicable Margin shall be determined based on Level 5. The provisions of this definition shall be subject to Section 2.4.(d).
“
Approved Fund
” means any Fund that is administered or managed by (a) a Lender, (b) an Affiliate of a Lender, or (c) an entity or an Affiliate of any entity that administers or manages a Lender.
“
Assignment and Assumption
” means an Assignment and Assumption Agreement among a Lender, an Eligible Assignee and the Administrative Agent, substantially in the form of
Exhibit A
.
“
Bankruptcy Code
” means the Bankruptcy Code of 1978, as amended.
“
Base Rate
” means the LIBOR Market Index Rate; provided, that if for any reason the LIBOR Market Index Rate is unavailable, Base Rate shall mean the per annum rate of interest equal to the Federal Funds Rate plus one and one-half of one percent (1.50%).
“
Base Rate Loan
” means a Loan bearing interest at a rate based on the Base Rate.
“
Benefit Arrangement
” means at any time an employee benefit plan within the meaning of Section 3(3) of ERISA which is not a Plan or a Multiemployer Plan and which is maintained or otherwise contributed to by any member of the ERISA Group.
“
Borrower
” has the meaning set forth in the introductory paragraph hereof and shall include the Borrower's successors and permitted assigns.
“
Borrower Information
” has the meaning given that term in Section 2.4.(d).
“
Business Day
” means (i) a day of the week (but not a Saturday, Sunday or holiday) on which the offices of the Administrative Agent in Minneapolis, Minnesota are open to the public for carrying on substantially all of the Administrative Agent's business functions, and (ii) if such day relates to a LIBOR
Loan, any such day that is also a day on which dealings in Dollars are carried on in the London interbank market. Unless specifically referenced in this Agreement as a Business Day, all references to “days” shall be to calendar days.
“
Capitalization Rate
” means seven and one-half of one percent (7.5%).
“
Capitalized Lease Obligations
” means obligations under a lease (or other arrangement conveying the right to use) to pay rent or other amounts, in each case that are required to be capitalized for financial reporting purposes in accordance with GAAP. The amount of a Capitalized Lease Obligation is the capitalized amount of such obligation as would be required to be reflected on a balance sheet of the applicable Person prepared in accordance with GAAP as of the applicable date.
“
Capital Reserves
” means, for any period and with respect to any Property, an amount equal to (a) the aggregate square footage of all completed space of such Property owned by the Borrower or any of its Subsidiaries
times
(b) $0.20
times
(c) the number of days in such period divided by (d) 365. If the term Capital Reserves is used without reference to any specific Property, then it shall be determined on an aggregate basis with respect to all Properties and the applicable Ownership Shares of all Properties of all Unconsolidated Affiliates.
“
Cash Collateralize
” means, to pledge and deposit with or deliver to the Administrative Agent, for the benefit of the Issuing Bank or the Lenders, as collateral for Letter of Credit Liabilities or obligations of Lenders to fund participations in respect of Letter of Credit Liabilities, cash or deposit account balances or, if the Administrative Agent and the
Issuing Bank shall agree in their sole discretion, other credit support, in each case pursuant to documentation in form and substance satisfactory to the Administrative Agent and the Issuing Bank. “Cash Collateral” shall have a meaning correlative to the foregoing and shall include the proceeds of such cash collateral and other credit support.
“
Cash Equivalents
” means: (a) securities issued, guaranteed or insured by the United States of America or any of its agencies with maturities of not more than one year from the date acquired; (b) certificates of deposit with maturities of not more than one year from the date acquired issued by a United States federal or state chartered commercial bank of recognized standing, or a commercial bank organized under the laws of any other country which is a member of the Organisation for Economic Cooperation and Development, or a political subdivision of any such country, acting through a branch or agency, which bank has capital and unimpaired surplus in excess of $500,000,000 and which bank or its holding company has a short-term commercial paper rating of at least A-2 or the equivalent by S&P or at least P-2 or the equivalent by Moody's; (c) reverse repurchase agreements with terms of not more than seven days from the date acquired, for securities of the type described in clause (a) above and entered into only with commercial banks having the qualifications described in clause (b) above; (d) commercial paper issued by any Person incorporated under the laws of the United States of America or any State thereof and rated at least A-2 or the equivalent thereof by S&P or at least P-2 or the equivalent thereof by Moody's, in each case with maturities of not more than one year from the date acquired; and (e) investments in money market funds registered under the Investment Company Act of 1940, as amended, which have net assets of at least $500,000,000 and at least eighty-five percent (85%) of whose assets consist of securities and other obligations of the type described in clauses (a) through (d) above.
“
Co-Lead Arrangers
” means each of Wells Fargo Securities, LLC and U.S. Bank National Association, in such capacity, together with their respective successors and assigns.
“
Commitment
” means a Revolving Commitment in an aggregate amount up to, but not exceeding the amount set forth for such Lender on
Schedule I
hereto as such Lender's respective
“Revolving Commitment Amount” (as the same may be reduced from time to time pursuant to Section 2.12. or otherwise pursuant to the terms of this Agreement).
“
Compliance Certificate
” has the meaning given that term in Section 9.3.
“
Continue
”, “
Continuation
” and “
Continued
” each refers to the continuation of a LIBOR Loan from one Interest Period to another Interest Period pursuant to Section 2.9.
“
Convert
”, “
Conversion
” and “
Converted
” each refers to the conversion of a Loan of one Type into a Loan of another Type pursuant to Section 2.10.
“
Credit Event
” means any of the following: (a) the making (or deemed making) of any Loan, (b) the Conversion of a Loan, (c) the Continuation of a LIBOR Loan and (d) the issuance of a Letter of Credit.
“
Credit Rating
” means the rating assigned by a Rating Agency to the senior unsecured long term Indebtedness of a Person.
“
Credit Rating Election Event
” has the meaning given that term in Section 2.4.(b).
“
Debtor Relief Laws
” means the Bankruptcy Code, and all other liquidation, conservatorship, bankruptcy, assignment for the benefit of creditors, moratorium, rearrangement, receivership, insolvency, reorganization, or similar Applicable Laws relating to the relief of debtors in the United States of America or other applicable jurisdictions from time to time in effect.
“
Default
” means any of the events specified in Section 11.1., whether or not there has been satisfied any requirement for the giving of notice, the lapse of time, or both.
“
Defaulting Lender
” means, subject to Section 3.9.(f), any Lender that (a) has failed to (i) fund all or any portion of its Loans within two (2) Business Days of the date such Loans were required to be funded hereunder unless such Lender notifies the Administrative Agent and the Borrower in writing that such failure is the result of such Lender's determination that one or more conditions precedent to funding (each of which conditions precedent, together with any applicable default, shall be specifically identified in such writing) has not been satisfied, or (ii) pay to the Administrative Agent, the Issuing Bank, the Swingline Lender or any other Lender any other amount required to be paid by it hereunder (including in respect of its participation in Letters of Credit or Swingline Loans) within two (2) Business Days of the date when due, (b) has notified the Borrower, the Administrative Agent, the Issuing Bank or the Swingline Lender in writing that it does not intend to comply with its funding obligations hereunder, or has made a public statement to that effect (unless such writing or public statement relates to such Lender's obligation to fund a Loan hereunder and states that such position is based on such Lender's determination that a condition precedent to funding (which condition precedent, together with any applicable default, shall be specifically identified in such writing or public statement) cannot be satisfied), (c) has failed, within three (3) Business Days after written request by the Administrative Agent or the Borrower, to confirm in writing to the Administrative Agent and the Borrower that it will comply with its prospective funding obligations hereunder (provided that such Lender shall cease to be a Defaulting Lender pursuant to this clause (c) upon receipt of such written confirmation by the Administrative Agent and the Borrower), or (d) has, or has a direct or indirect parent company that has, (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; 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 Administrative Agent that a Lender is a Defaulting Lender under clauses (a) through (d) above shall be conclusive and binding absent manifest error, and such Lender shall be deemed to be a Defaulting Lender (subject to Section 3.9.(f)) upon delivery of written notice of such determination to the Borrower, the Issuing Bank, the Swingline Lender and each Lender.
“
Derivatives Contract
” : means (a) any transaction (including any master agreement, confirmation or other agreement with respect to any such transaction) now existing or hereafter entered into by the Parent, the Borrower or any of their respective Subsidiaries (i) which is a rate swap transaction, swap option, basis swap, forward rate transaction, commodity swap, commodity option, equity or equity index swap, equity or equity index option, bond option, interest rate option, foreign exchange transaction, cap transaction, floor transaction, collar transaction, currency swap transaction, cross-currency rate swap transaction, currency option, credit protection transaction, credit swap, credit default swap, credit default option, total return swap, credit spread transaction, repurchase transaction, reverse repurchase transaction, buy/sell-back transaction, securities lending transaction, weather index transaction or forward purchase or sale of a security, commodity or other financial instrument or interest (including any option with respect to any of these transactions) or (ii) which is a type of transaction that is similar to any transaction referred to in clause (i) above that is currently, or in the future becomes, recurrently entered into in the financial markets (including terms and conditions incorporated by reference in such agreement) and which is a forward, swap, future, option or other derivative on one or more rates, currencies, commodities, equity securities or other equity instruments, debt securities or other debt instruments, economic indices or measures of economic risk or value, or other benchmarks against which payments or deliveries are to be made, and (b) any combination of these transactions.
“
Derivatives Support Document
” means (i) any Credit Support Annex comprising part of (and as defined in) any Specified Derivatives Contract, and (ii) any document or agreement pursuant to which cash, deposit accounts, securities accounts or similar financial asset collateral are pledged to or made available for setoff by, a Specified Derivatives Provider, including any banker's lien or similar right, securing or supporting Specified Derivatives Obligation.
“
Derivatives Termination Value
” means, in respect of any one or more Derivatives Contracts, after taking into account the effect of any legally enforceable netting agreement or provision relating thereto, (a) for any date on or after the date such Derivatives Contracts have been terminated or closed out, the termination amount or value determined in accordance therewith, and (b) for any date prior to the date such Derivatives Contracts have been terminated or closed out, the then-current mark-to-market value for such Derivatives Contracts, determined based upon one or more mid-market quotations or estimates provided by any recognized dealer in Derivatives Contracts (which may include the Administrative Agent, any Lender, any Specified Derivatives Provider or any Affiliate of any thereof).
“
Development Property
” means a Property currently under development that has not achieved an Occupancy Rate of eighty-five percent (85%) or more or, subject to the last sentence of this definition, on which the improvements (other than tenant improvements on unoccupied space) related to the development have not been completed. The term “Development Property” shall include real property of
the type described in the immediately preceding sentence that satisfies both of the following conditions: (i) it is to be (but has not yet been) acquired by the Borrower, any Subsidiary or any Unconsolidated Affiliate upon completion of construction pursuant to a contract in which the seller of such real property is required to develop or renovate prior to, and as a condition precedent to, such acquisition and (ii) a third party is developing such property using the proceeds of a loan that is Guaranteed by, or is otherwise recourse to, the Parent, the Borrower, any Subsidiary or any Unconsolidated Affiliate. A Development Property on which all improvements (other than tenant improvements on unoccupied space) related to the development of such Property have been completed for at least fifteen (15) months shall cease to constitute a Development Property notwithstanding the fact that such Property has not achieved an Occupancy Rate of at least eighty-five percent (85%).
“
Dollars
” or “
$
” means the lawful currency of the United States of America.
“
EBITDA
” means, with respect to a Person, for any period and without duplication, the sum of (a) net income (loss) of such Person for such period determined on a consolidated basis excluding the following (but only to the extent included in determining net income (loss) for such period): (i) depreciation and amortization expense (less depreciation and amortization expense allocable to non-controlling interest in Subsidiaries of the Borrower for such period); (ii) interest expense; (iii) income tax expense; (iv) extraordinary or nonrecurring items, including without limitation, gains and losses from the sale of operating Properties; and (v) equity in net income (loss) of its Unconsolidated Affiliates
plus
(b) such Person's Ownership Share of EBITDA of Unconsolidated Affiliates for such period. EBITDA shall be adjusted to remove any impact from straight line rent leveling adjustments required under GAAP and amortization of intangibles pursuant to FASB ASC 805. For purposes of this definition, nonrecurring items shall be deemed to include (v) abandoned projects, (w) impairments and other non-cash charges, (x) gains and losses on early extinguishment of Indebtedness, (y) cash or non-cash severance and other non-cash restructuring charges and (z) transaction costs of acquisitions not permitted to be capitalized pursuant to GAAP.
“
Effective Date
” means the later of (a) the Agreement Date and (b) the date on which all of the conditions precedent set forth in Section 6.1. shall have been fulfilled or waived in accordance with the provisions of Section 13.7.
“
Eligible Assignee
” means (a) a Lender, (b) an Affiliate of a Lender, (c) an Approved Fund and (d) any other Person (other than a natural person) approved by (i) the Administrative Agent and (ii) unless a Default or Event of Default exists, the Borrower (each such approval not to be unreasonably withheld or delayed); provided that notwithstanding the foregoing, “Eligible Assignee” shall not include the Borrower or any of the Borrower's Affiliates or Subsidiaries or any Defaulting Lender or its Affiliates.
“
Eligible Property
” means a Property which satisfies all of the following requirements as confirmed by the Administrative Agent: (a) such Property is wholly owned in fee simple (or with the consent of the Requisite Lenders, leased under a Ground Lease) by the Borrower or a Wholly Owned Subsidiary (which Subsidiary shall be a Guarantor unless Guarantors shall have been released pursuant to the provisions of the second sentence of Section 8.14.(b) or shall be the Management Company or any Wholly Owned Subsidiary of the Management Company); (b) such Property is located in a State of the United States of America or in the District of Columbia; (c) neither such Property, nor any interest of the Borrower or any Subsidiary therein, nor, if such Property is owned by a Subsidiary, any of the Borrower's direct or indirect ownership interest in such Subsidiary, is subject to (i) any Lien other than Permitted Liens (but not Permitted Liens described in clause (g) of the definition of that term) or (ii) any Negative Pledge; (d) regardless of whether such Property is owned (or with the consent of the Requisite Lenders,
leased under a Ground Lease) by the Borrower or a Wholly Owned Subsidiary, the Borrower has the right directly, or indirectly through a Wholly Owned Subsidiary, to take the following actions without the need to obtain the consent of any Person: (i) to create Liens on such Property as security for Indebtedness of the Borrower or such Subsidiary, as applicable, and (ii) to sell, transfer or otherwise dispose of such Property; and (e) to Borrower's knowledge, such Property is free of all structural defects or major architectural deficiencies, title defects, environmental conditions or other adverse matters except for defects, deficiencies, conditions or other matters individually or collectively which are not material to the profitable operation of such Property. The initial list of Eligible Properties shall be provided by the Borrower to the Administrative Agent and the Lenders on the Agreement Date in the Officer's Certificate. For the avoidance of doubt, no Property owned or leased by an Excluded Subsidiary (other than the Management Company or any Wholly Owned Subsidiary of the Management Company) shall be an “Eligible Property” hereunder.
“
Environmental Laws
” means any Applicable Law relating to environmental protection or the manufacture, storage, remediation, disposal or clean-up of Hazardous Materials including, without limitation, the following: Clean Air Act, 42 U.S.C. § 7401 et seq.; Federal Water Pollution Control Act, 33 U.S.C. § 1251 et seq.; Solid Waste Disposal Act, as amended by the Resource Conservation and Recovery Act, 42 U.S.C. § 6901 et seq.; Comprehensive Environmental Response, Compensation and Liability Act, 42 U.S.C. § 9601 et seq.; National Environmental Policy Act, 42 U.S.C. § 4321 et seq.; regulations of the Environmental Protection Agency, any applicable rule of common law and any judicial interpretation thereof relating primarily to the environment or Hazardous Materials, and any analogous or comparable state or local laws, regulations or ordinances that concern Hazardous Materials or protection of the environment.
“
Equity Interest
” means, 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, whether or not certificated, 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 non-voting, and whether or not such share, warrant, option, right or other interest is authorized or otherwise existing on any date of determination.
“
Equity Issuance
” means any issuance or sale by a Person of any Equity Interest in such Person and shall in any event include the issuance of any Equity Interest upon the conversion or exchange of any security constituting Indebtedness that is convertible or exchangeable, or is being converted or exchanged, for Equity Interests.
“
ERISA
” means the Employee Retirement Income Security Act of 1974, as amended.
“
ERISA Group
” means the Borrower, any Subsidiary and all members of a controlled group of corporations and all trades or businesses (whether or not incorporated) under common control which, together with the Borrower or any Subsidiary, are treated as a single employer under Section 414 of the Internal Revenue Code.
“
Event of Default
” means any of the events specified in Section 11.1., provided that any requirement for notice or lapse of time or any other condition has been satisfied.
“
Excluded Subsidiary
” means (a) any Subsidiary of the Borrower that (x)(i) holds title to assets that are or are to become collateral for any Secured Indebtedness of such Subsidiary or (ii) owns, directly or indirectly, any Equity Interests in a Subsidiary or Unconsolidated Affiliate holding title to assets that are or are to become collateral for any Secured Indebtedness of such Subsidiary or Unconsolidated Affiliate and (y) in the case of any such Subsidiary under clause (a)(x)(ii), (1) is prohibited from Guaranteeing the Indebtedness of any other Person pursuant to (i) any document, instrument or agreement evidencing such Secured Indebtedness or (ii) a provision of such Subsidiary's organizational documents, which was included in such Subsidiary's organizational documents as a condition to the incurrence of such Secured Indebtedness or (2) does not own any Specified Equity Interests, (b) any Subsidiary of the Borrower (other than a Wholly Owned Subsidiary of the Borrower) that is prohibited from Guaranteeing the Indebtedness of any other Person pursuant to a provision of such Subsidiary's organizational documents as in effect as of the Agreement Date, (c) Hamilton Insurance Company, LLC, Chattanooga Insurance Company, Ltd., and DM Cayman II, Inc., in each case solely to the extent such Subsidiary continues to be in the business of insurance services of the type in which it is engaged as of the Agreement Date, (d) the Management Company and any of its Wholly Owned Subsidiaries and (e) Arbor Place Limited Partnership, The Galleria Associates, L.P., Oak Park Holding I, LLC, CBL/MS General Partnership, Montgomery Partners, L.P., Jarnigan Road Limited Partnership, Laurel Park Retail Holding LLC, OK City Member, LLC, CW Joint Venture, LLC, CBL SubREIT, Inc., Foothills Mall Associates, LP and The Pavilion at Port Orange, LLC, in each case solely for so long as such Subsidiary would have adverse tax consequences to any owner (either direct or indirect) of its Equity Interests were it not designated an “Excluded Subsidiary” hereunder. The initial list of Excluded Subsidiaries shall be provided by the Borrower to the Administrative Agent and the Lenders on the Agreement Date in the Officer's Certificate.
“
Existing Credit Agreement
” has the meaning given that term in the first “WHEREAS” clause of this Agreement.
“
Fair Market Value
” means, (a) with respect to a security listed on a national securities exchange or the NASDAQ National Market, the price of such security as reported on such exchange or market by any widely recognized reporting method customarily relied upon by financial institutions and (b) with respect to any other property, the price which could be negotiated in an arm's-length free market transaction, for cash, between a willing seller and a willing buyer, neither of which is under pressure or compulsion to complete the transaction. Except as otherwise provided herein, Fair Market Value shall be determined by the Board of Directors of the Parent (or an authorized committee thereof) acting in good faith conclusively evidenced by a board resolution thereof delivered to the Administrative Agent or, with respect to any asset valued at no more than $1,000,000, such determination may be made by the chief financial officer of the Parent evidenced by an officer's certificate delivered to the Administrative Agent, in either case such determination being subject to the Administrative Agent's review and reasonable approval.
“
Federal Funds Rate
” means, for any period, a fluctuating interest rate per annum equal for each day during such period to the weighted average of the rates on overnight Federal Funds transactions with members of the Federal Reserve System arranged by Federal Funds brokers, as published for such day (or, if such day is not a Business Day, for the next preceding Business Day) by the Federal Reserve Bank of New York, or, if such rate is not so published for any day which is a Business Day, the average of the quotations for such day on such transactions received by the Administrative Agent from three (3) Federal Funds brokers of recognized standing selected by the Administrative Agent.
“
Fee Letter
” means that certain fee letter dated as of November 1, 2012, by and between the Borrower and the Administrative Agent.
“
Fees
” means the fees and commissions provided for or referred to in Section 3.5. and any other fees payable by the Borrower hereunder, under any other Loan Document or under the Fee Letter.
“
Fixed Charges
” means, with respect to a Person and for a given period, without duplication, the sum of (a) the Interest Expense of such Person for such period,
plus
(b) the aggregate of all regularly scheduled principal payments on Indebtedness payable by such Person during such period (excluding balloon, bullet or similar payments of principal due upon the stated maturity of Indebtedness). The Parent's Ownership Share of the Fixed Charges of Unconsolidated Affiliates will be included when determining the Fixed Charges of the Parent.
“
Foreign Lender
” means any Lender that is organized under the laws of a jurisdiction other than that in which the Borrower is resident for tax purposes. For purposes of this definition, the United States of America, each State thereof and the District of Columbia shall be deemed to constitute a single jurisdiction.
“
Fronting Exposure
” means, at any time there is a Defaulting Lender, (a) with respect to the Issuing Bank, such Defaulting Lender's Revolving Commitment Percentage of the outstanding Letter of Credit Liabilities other than Letter of Credit Liabilities as to which such Defaulting Lender's participation obligation has been reallocated to other Lenders or Cash Collateralized in accordance with the terms hereof, and (b) with respect to the Swingline Lender, such Defaulting Lender's Revolving Commitment Percentage of outstanding Swingline Loans other than Swingline Loans as to which such Defaulting Lender's participation obligation has been reallocated to other Lenders.
“
Fund
” means any Person (other than a natural person) that is (or will be) engaged in making, purchasing, holding or otherwise investing in commercial loans and similar extensions of credit in the ordinary course of its business.
“
Funds From Operations
” means, with respect to a Person and for a given period, net income (computed in accordance with GAAP), excluding gains (or losses) on sales of operating properties, plus depreciation, amortization, and after adjustments for unconsolidated partnerships, joint ventures and minority interests. Adjustments for unconsolidated partnerships and joint ventures are calculated on the same basis. For purposes of this Agreement, Funds From Operations shall be calculated consistent with the definition of "Funds From Operations" as set forth in the Parent 's Form 10-Q for the second quarter of Fiscal Year 2012 as filed with the Securities and Exchange Commission, as such definition may be modified with the prior approval of Requisite Lenders.
“
GAAP
” means accounting principles generally accepted in the United States of America as set forth in the opinions and pronouncements of the Accounting Principles Board of the American Institute of Certified Public Accountants and statements and pronouncements of the Financial Accounting Standards Board or in such other statements by such other entity including, without limitation, the Securities and Exchange Commission, as may be approved by a significant segment of the accounting profession in the United States of America, which are applicable to the circumstances as of the date of determination.
“
General Partner
” means CBL Holdings I, Inc., a Delaware corporation, and a Wholly Owned Subsidiary of the Parent and the sole general partner of Borrower, and shall include the General Partner's successors and permitted assigns.
“
Governmental Approvals
” means all authorizations, consents, approvals, licenses and exemptions of, registrations and filings with, and reports to, all Governmental Authorities.
“
Governmental Authority
” means any national, state or local government (whether domestic or foreign), any political subdivision thereof or any other governmental, quasi-governmental, judicial, administrative, public or statutory instrumentality, authority, body, agency, bureau, commission, board, department or other entity that has the right to govern any of the parties to this Agreement (including, without limitation, the Federal Deposit Insurance Corporation, the Comptroller of the Currency or the Federal Reserve Board, any central bank or any comparable authority) or any arbitrator with authority to bind a party at law.
“
Ground Lease
” means a ground lease containing the following terms and conditions: (a) the right of the lessee to mortgage and encumber its interest in the leased property without the consent of the lessor; (b) the obligation of the lessor to give the holder of any mortgage Lien on such leased property written notice of any defaults on the part of the lessee and agreement of such lessor that such lease will not be terminated until such holder has had a reasonable opportunity to cure or complete foreclosures, and fails to do so; (c) reasonable transferability of the lessee's interest under such lease, including ability to sublease; and (d) such other rights customarily required by mortgagees making a loan secured by the interest of the holder of the leasehold estate demised pursuant to a ground lease.
“
Guarantors
” means, individually and collectively, as the context shall require: (i) the Parent, (ii) all Material Subsidiaries (other than Excluded Subsidiaries), (iii) any Subsidiary of the Borrower (other than an Excluded Subsidiary) that owns, directly or indirectly, any Equity Interests of any other Guarantor and (iv) any Subsidiary that elects to become a Guarantor.
“
Guaranty
”, “
Guaranteed
” or to “
Guarantee
” as applied to any obligation means and includes: (a) a guaranty (other than by endorsement of negotiable instruments for collection in the ordinary course of business), directly or indirectly, in any manner, of any part or all of such obligation, or (b) an agreement, direct or indirect, contingent or otherwise, and whether or not constituting a guaranty, the practical effect of which is to assure the payment or performance (or payment of damages in the event of non-performance) of any part or all of such obligation whether by: (i) the purchase of securities or obligations, (ii) the purchase, sale or lease (as lessee or lessor) of property or the purchase or sale of services primarily for the purpose of enabling the obligor with respect to such obligation to make any payment or performance (or payment of damages in the event of non-performance) of or on account of any part or all of such obligation, or to assure the owner of such obligation against loss, (iii) the supplying of funds to or in any other manner investing in the obligor with respect to such obligation, (iv) repayment of amounts drawn down by beneficiaries of letters of credit (including Letters of Credit), or (v) the supplying of funds to or investing in a Person on account of all or any part of such Person's obligation under a Guaranty of any obligation or indemnifying or holding harmless, in any way, such Person against any part or all of such obligation. As the context requires, “Guaranty” shall also mean each guaranty executed and delivered pursuant to Section 6.1. or 8.14. and substantially in the form of
Exhibit B
.
“
Hazardous Materials
” means all or any of the following: (a) substances that are defined or listed in, or otherwise classified pursuant to, any applicable Environmental Laws as “hazardous substances”, “hazardous materials”, “hazardous wastes”, “toxic substances” or any other formulation intended to define, list or classify substances by reason of deleterious properties such as ignitability, corrosivity, reactivity, carcinogenicity, reproductive toxicity, “TCLP” toxicity, or “EP toxicity”; (b) oil, petroleum or petroleum derived substances, natural gas, natural gas liquids or synthetic gas and drilling fluids, produced waters and other wastes associated with the exploration, development or production of
crude oil, natural gas or geothermal resources; (c) any flammable substances or explosives or any radioactive materials; (d) asbestos in any form; (e) toxic mold; and (f) electrical equipment which contains any oil or dielectric fluid containing levels of polychlorinated biphenyls in excess of fifty parts per million.
“
Indebtedness
” means, 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 or for the deferred purchase price of property or services (excluding trade debt incurred in the ordinary course of business); (b) all obligations of such Person, whether or not for money borrowed (i) represented by notes payable, or drafts accepted, in each case representing extensions of credit (but only to the extent of any outstanding balance), (ii) evidenced by bonds, debentures, notes or similar instruments (but only to the extent such debt is not otherwise included in Indebtedness), 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 for services rendered; (c) Capitalized Lease Obligations of such Person; (d) all reimbursement obligations (contingent or otherwise) of such Person under or in respect of 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 to purchase, redeem, retire, defease or otherwise make any payment in respect of any Mandatorily Redeemable Stock issued by such Person or any other Person, valued at the greater of its voluntary or involuntary liquidation preference plus accrued and unpaid dividends; (g) 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 (other than Mandatorily Redeemable Stock)); (h) net obligations under any Derivatives Contract not entered into as a hedge against then existing Indebtedness (which shall be deemed to have an amount equal to the Derivatives Termination Value thereof at such time but in no event shall be less than zero); (i) 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, voluntary bankruptcy, collusive involuntary bankruptcy and other similar customary exceptions to non-recourse liability); (j) 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 (k) such Person's Ownership Share of the Indebtedness of any Unconsolidated Affiliate of such Person. Indebtedness of any Person shall include Indebtedness of any partnership or joint venture in which such Person is a general partner or joint venturer to the extent of such Person's Ownership Share of such partnership or joint venture (except if such Indebtedness, or portion thereof, is recourse to such Person, in which case the greater of such Person's Ownership Share of such Indebtedness or the amount of the recourse portion of the Indebtedness shall be included as Indebtedness of such Person). All Loans and Letter of Credit Liabilities shall constitute Indebtedness of the Borrower.
“
Intellectual Property
” has the meaning given that term in Section 7.1.(s).
“
Interest Expense
” means, with respect to any Person, for any period, without duplication, (a) total interest expense of such Person (including, without limitation, capitalized interest not funded under a construction loan interest reserve account, interest expense attributable to Capitalized Lease Obligations, letter of credit fees, and interest expense with respect to any Indebtedness in respect of which such Person is wholly or partially liable whether pursuant to any repayment, interest carry, performance guaranty or
otherwise) determined on a consolidated basis in accordance with GAAP for such period, plus (b) such Person's Ownership Share of Interest Expense of Unconsolidated Affiliates for such period.
“
Interest Period
” means with respect to each LIBOR Loan, each period commencing on the date such LIBOR Loan is made, or in the case of the Continuation of a LIBOR Loan the last day of the preceding Interest Period for such Loan, and ending on the numerically corresponding day in the first, third or sixth calendar month thereafter, as the Borrower may select in a Notice of Borrowing, Notice of Continuation or Notice of Conversion, as the case may be, except that each Interest Period that commences on the last Business Day of a calendar month (or on any day for which there is no numerically corresponding day in the appropriate subsequent calendar month) shall end on the last Business Day of the appropriate subsequent calendar month. Notwithstanding the foregoing: (a) if any Interest Period would otherwise end after the Maturity Date, such Interest Period shall end on the Maturity Date and (b) each Interest Period that would otherwise end on a day which is not a Business Day shall end on the immediately following Business Day (or, if such immediately following Business Day falls in the next calendar month, on the immediately preceding Business Day).
“
Internal Revenue Code
” means the Internal Revenue Code of 1986, as amended.
“
Investment
” means, with respect to any Person, any acquisition or investment (whether or not of a controlling interest) by such Person, by means of any of the following: (a) the purchase or other acquisition of any Equity Interest in another Person, (b) a loan, advance or extension of credit to, capital contribution to, Guaranty of Indebtedness of, or purchase or other acquisition of any Indebtedness of, another Person, including any partnership or joint venture interest in such other Person, or (c) the purchase or other acquisition (in one transaction or a series of transactions) of assets of another Person that constitute the business or a division or operating unit of another Person. Any commitment to make an Investment in any other Person, as well as any option of another Person to require an Investment in such Person, shall constitute an Investment. Except as expressly provided otherwise, for purposes of determining compliance with any covenant contained in a Loan Document, the amount of any Investment shall be the amount actually invested, without adjustment for subsequent increases or decreases in the value of such Investment.
“
Investment Grade Rating
” means a Credit Rating of BBB-/Baa3 (or the equivalent) or higher from a Rating Agency.
“
Issuing Bank
” means Wells Fargo or, after written notice to Borrower, any other Lender, each in its capacity as an issuer of Letters of Credit pursuant to Section 2.2.
“
L/C Commitment Amount
” has the meaning given to that term in Section 2.2.(a).
“
L/C Disbursement
” has the meaning given to that term in Section 3.9.(b).
“
Lender
” means each financial institution from time to time party hereto as a “Lender”, together with its respective successors and permitted assigns, and, as the context requires, includes the Swingline Lender; provided, however, that the term “Lender”, except as otherwise expressly provided herein, shall not include any Lender (or its Affiliates) in its capacity as a Specified Derivatives Provider. With respect to matters requiring the consent or approval of all Lenders at any given time, all then existing Defaulting Lenders will be disregarded and excluded, and, for voting purposes only, “all Lenders” shall be deemed to mean “all Lenders other than Defaulting Lenders”.
“
Lending Office
” means, for each Lender and for each Type of Loan, the office of such Lender specified in such Lender's Administrative Questionnaire or in the applicable Assignment and Assumption, or such other office of such Lender as such Lender may notify the Administrative Agent in writing from time to time.
“
Letter of Credit
” has the meaning given that term in Section 2.2.(a).
“
Letter of Credit Collateral Account
” means a special deposit account maintained by the Administrative Agent, for the benefit of the Administrative Agent, the Issuing Bank and the Lenders, and under its sole dominion and control.
“
Letter of Credit Documents
” means, with respect to any Letter of Credit, collectively, any application therefor, any certificate or other document presented in connection with a drawing under such Letter of Credit and any other agreement, instrument or other document governing or providing for (a) the rights and obligations of the parties concerned or at risk with respect to such Letter of Credit or (b) any collateral security for any of such obligations.
“
Letter of Credit Liabilities
” means, without duplication, at any time and in respect of any Letter of Credit, the sum of (a) the Stated Amount of such Letter of Credit plus (b) the aggregate unpaid principal amount of all Reimbursement Obligations of the Borrower at such time due and payable in respect of all drawings made under such Letter of Credit. For purposes of this Agreement, a Lender (other than the Lender then acting as Issuing Bank) shall be deemed to hold a Letter of Credit Liability in an amount equal to its participation interest under Section 2.2. in the related Letter of Credit, and the Lender then acting as the Issuing Bank shall be deemed to hold a Letter of Credit Liability in an amount equal to its retained interest in the related Letter of Credit after giving effect to the acquisition by the Lenders (other than the Lender then acting as the Issuing Bank) of their participation interests under such Section.
“
Level
” has the meaning given that term in the definition of the term “Applicable Margin.”
“
LIBOR
” means, for the Interest Period for any LIBOR Loan, the rate of interest, rounded up to the nearest whole multiple of one-hundredth of one percent (0.01%), obtained by dividing (i) the rate of interest, rounded upward to the nearest whole multiple of one-hundredth of one percent (0.01%), referred to as the BBA (British Bankers' Association) LIBOR rate as set forth by any service selected by the Administrative Agent that has been nominated by the British Bankers' Association as an authorized information vendor for the purpose of displaying such rate for deposits in U.S. Dollars at approximately 11:00 a.m. Central time, two (2) Business Days prior to the date of commencement of such Interest Period for purposes of calculating effective rates of interest for loans or obligations making reference thereto, for an amount approximately equal to the applicable LIBOR Loan and for a period of time approximately equal to such Interest Period
by
(ii) a percentage equal to 1
minus
the stated maximum rate (stated as a decimal) of all reserves, if any, required to be maintained with respect to Eurocurrency funding (currently referred to as “Eurocurrency liabilities”) as specified in Regulation D of the Board of Governors of the Federal Reserve System (or against any other category of liabilities which includes deposits by reference to which the interest rate on LIBOR Loans is determined or any applicable category of extensions of credit or other assets which includes loans by an office of any Lender outside of the United States of America). Any change in such maximum rate shall result in a change in LIBOR on the date on which such change in such maximum rate becomes effective.
“
LIBOR Loan
” means a Loan bearing interest at a rate based on LIBOR, but
excluding
any Base Rate Loan.
“
LIBOR Market Index Rate
” means, for any day, LIBOR as of that day for one-month deposits in U.S. Dollars at approximately 11:00 a.m. Central time for such day (or if such day is not a Business Day, the immediately preceding Business Day). The LIBOR Market Index Rate shall be determined on a daily basis.
“
Lien
” as applied to the property of any Person means: (a) any security interest, encumbrance, mortgage, deed to secure debt, deed of trust, assignment of leases or rents, pledge, lien, hypothecation, assignment, charge or lease constituting a Capitalized Lease Obligation, conditional sale or other title retention agreement, or other security title or encumbrance of any kind in respect of any property of such Person, or upon the income, rents or profits therefrom; (b) any arrangement, express or implied, under which any property of such Person is transferred, sequestered or otherwise identified for the purpose of subjecting the same to the payment of Indebtedness or performance of any other obligation in priority to the payment of the general, unsecured creditors of such Person; (c) the filing of any financing statement under the Uniform Commercial Code or its equivalent in any jurisdiction, other than any precautionary filing not otherwise constituting or giving rise to a Lien, including a financing statement filed (i) in respect of a lease not constituting a Capitalized Lease Obligation pursuant to Section 9-505 (or a successor provision) of the Uniform Commercial Code or its equivalent as in effect in an applicable jurisdiction or (ii) in connection with a sale or other disposition of accounts or other assets not prohibited by this Agreement in a transaction not otherwise constituting or giving rise to a Lien; and (d) any agreement by such Person to grant, give or otherwise convey any of the foregoing.
“
Limited Subsidiary
” means any Subsidiary of the Parent that, directly or indirectly, owns (a) any Equity Interest in any Loan Party or (ii) any Specified Equity Interests.
“
Loan
” means a Revolving Loan or a Swingline Loan.
“
Loan Document
” means this Agreement, each Note, the Guaranty, the Parent Guaranty, each Letter of Credit Document and each other document or instrument now or hereafter executed and delivered by a Loan Party in connection with, pursuant to or relating to this Agreement (other than the Fee Letter and any Specified Derivatives Contract).
“
Loan Party
” means each of the Borrower, each Guarantor, the General Partner and each other Person who guarantees all or a portion of the Obligations. Part I of
Schedule 7.1.(b)
sets forth the Loan Parties in addition to the Borrower as of the Agreement Date. For purposes of clarity, any Person which is a Loan Party solely by virtue of having Guaranteed all or a portion of the Obligations shall cease to be a Loan Party upon the release of such Person from all of its obligations under such Guaranty.
“
Management Company
” means CBL & Associates Management, Inc., a Delaware corporation, or any other Person that succeeds to the obligations of CBL & Associates Management, Inc. to manage the Properties, together with its successors and permitted assigns.
“
Mandatorily Redeemable Stock
” means, with respect to any Person, any Equity Interest of such Person which by the terms of such Equity Interest (or by the terms of any security into which it is convertible or for which it is exchangeable or exercisable), upon the happening of any event or otherwise, (a) matures or is mandatorily redeemable, pursuant to a sinking fund obligation or otherwise (other than an Equity Interest to the extent redeemable in exchange for common stock or other equivalent common Equity Interests at the option of the issuer of such Equity Interest), (b) is convertible into or exchangeable or exercisable for Indebtedness or Mandatorily Redeemable Stock, or (c) is redeemable at the option of the holder thereof, in whole or in part (other than an Equity Interest which is redeemable solely in
exchange for common stock or other equivalent common Equity Interests, or, at the election of the Borrower, in exchange for cash); in each case, on or prior to the Maturity Date.
“
Material Adverse Effect
” means a materially adverse effect on (a) the business, assets, liabilities, condition (financial or otherwise), results of operations or business prospects of the Borrower and its Subsidiaries, or the Parent and its Subsidiaries, in either case taken as a whole, (b) the ability of the Borrower, any other Loan Party or the Parent to perform its obligations under any Loan Document to which it is a party, (c) the validity or enforceability of any of the Loan Documents, (d) the rights and remedies of the Lenders, the Issuing Bank and the Administrative Agent under any of the Loan Documents or (e) the timely payment of the principal of or interest on the Loans or other amounts payable in connection therewith or the timely payment of all Reimbursement Obligations.
“
Material Contract
” means any contract or other arrangement relating to a Property (other than Loan Documents and Specified Derivatives Contracts), whether written or oral, to which the Borrower, any Subsidiary or any other Loan Party is a party as to which the breach, non-performance, cancellation or failure to renew by any party to such contract or other arrangement could reasonably be expected to have a Material Adverse Effect.
“
Material Plan
” means at any time a Plan or Plans having aggregate Unfunded Liabilities in excess of $1,000,000.
“
Material Subsidiary
” means any Subsidiary having assets with a Fair Market Value greater than or equal to $10,000,000.
“
Maturity Date
” means November 13, 2015, as such date may be extended pursuant to Section 2.13.
“
Moody's
” means Moody's Investors Service, Inc. and its successors.
“
Mortgage
” means a mortgage, deed of trust, deed to secure debt or similar security instrument made or to be made by a Person owning an interest in real estate granting a Lien on such interest in real estate as security for the payment of Indebtedness.
“
Mortgage Receivable
” means Indebtedness secured by Mortgages in favor of the Borrower or any Subsidiary.
“
Multiemployer Plan
” means at any time a multiemployer plan within the meaning of Section 4001(a)(3) of ERISA to which any member of the ERISA Group is then making or accruing an obligation to make contributions or has within the preceding five (5) plan years made contributions, including for these purposes any Person which ceased to be a member of the ERISA Group during such five (5) year period.
“
Negative Pledge
” means, with respect to a given asset, any provision of a document, instrument or agreement (other than any Loan Document or Specified Derivatives Contract) which prohibits or purports to prohibit the creation or assumption of any Lien on such asset as security for Indebtedness of the Person owning such asset or any other Person; provided, however, that an agreement that conditions a Person's ability to encumber its assets upon the maintenance of one or more specified ratios that limit such Person's ability to encumber its assets but that do not generally prohibit the encumbrance of its assets, or the encumbrance of specific assets, shall not constitute a Negative Pledge.
“
Net Operating Income
” or “
NOI
” means, for any Property and for a given period, the sum of the following (without duplication and determined on a consistent basis with prior periods): (a) rents and other revenues received in the ordinary course from such Property (including proceeds of rent loss or business interruption insurance but 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 (excluding interest) related to the ownership, operation or maintenance of such Property, including but not limited to property taxes, assessments and the like, insurance, utilities, payroll costs, maintenance, repair and landscaping expenses, marketing expenses, and general and administrative expenses (including an appropriate allocation for legal, accounting, advertising, marketing and other expenses incurred in connection with such Property, but specifically excluding general overhead expenses of the Parent and its Subsidiaries and any property management fees)
minus
(c) the Capital Reserves for such Property as of the end of such period
minus
(d) an imputed management fee in the amount of three percent (3%) of the aggregate base rents and percentage rents received for such Property for such period.
“
Net Proceeds
” means with respect to an Equity Issuance by a Person, the aggregate amount of all cash and the Fair Market Value of all other property (other than securities of such Person being converted or exchanged in connection with such Equity Issuance) received by such Person in respect of such Equity Issuance net of (a) investment banking fees, legal fees, accountants' fees, underwriting discounts and commissions and other customary fees and expenses actually incurred by such Person in connection with such Equity Issuance and (b) the aggregate amount of cash payments made to holders of Equity Interests of such Person to retire or repurchase such Equity Interests during three calendar month period following the date on which such Equity Issuance occurred, provided that the amount under this clause (b) shall in no event exceed the aggregate cash proceeds received from such Equity Issuance.
“
Non-Defaulting Lender
” means, at any time, each Lender that is not a Defaulting Lender at such time.
“
Non-Recourse Indebtedness
” means, with respect to a Person, Indebtedness for borrowed money in respect of which recourse for payment (except for customary exceptions for fraud, misapplication of funds, environmental indemnities, voluntary bankruptcy, collusive involuntary bankruptcy and other similar customary exceptions to non-recourse liability in a form reasonably acceptable to the Administrative Agent) is contractually limited to specific assets of such Person encumbered by a Lien securing such Indebtedness.
“
Note
” means a Revolving Note or a Swingline Note.
“
Notice of Borrowing
” means a notice substantially in the form of
Exhibit C
(or such other form reasonably acceptable to the Administrative Agent and containing the information required in such Exhibit) to be delivered to the Administrative Agent pursuant to Section 2.1.(b) evidencing the Borrower's request for a borrowing of Revolving Loans.
“
Notice of Continuation
” means a notice substantially in the form of
Exhibit D
(or such other form reasonably acceptable to the Administrative Agent and containing the information required in such Exhibit) to be delivered to the Administrative Agent pursuant to Section 2.9. evidencing the Borrower's request for the Continuation of a LIBOR Loan.
“
Notice of Conversion
” means a notice substantially in the form of
Exhibit E
(or such other form reasonably acceptable to the Administrative Agent and containing the information required in such Exhibit) to be delivered to the Administrative Agent pursuant to Section 2.10. evidencing the Borrower's request for the Conversion of a Loan from one Type to another Type.
“
Notice of Swingline Borrowing
” means a notice substantially in the form of
Exhibit F
(or such other form reasonably acceptable to the Administrative Agent and containing the information required in such Exhibit) to be delivered to the Swingline Lender pursuant to Section 2.3.(b) evidencing the Borrower's request for a Swingline Loan.
“
Obligations
” means, individually and collectively, without duplication: (a) the aggregate principal balance of, and all accrued and unpaid interest on, all Loans; (b) all Reimbursement Obligations and all other Letter of Credit Liabilities; and (c) all other indebtedness, liabilities, obligations, covenants and duties of the Borrower or any of the other Loan Parties owing to the Administrative Agent, the Issuing Bank or any Lender of every kind, nature and description, under or in respect of this Agreement or any of the other Loan Documents, including, without limitation, the Fees and indemnification obligations, whether direct or indirect, absolute or contingent, due or not due, contractual or tortious, liquidated or unliquidated, and whether or not evidenced by any promissory note. For the avoidance of doubt, “Obligations” shall not include Specified Derivatives Obligations.
“
Occupancy Rate
” means, with respect to a Property at any time, the ratio, expressed as a percentage, of (a) the net rentable owned square footage of such Property actually occupied by tenants (unless due to a temporary cessation of business, or tenants scheduled to open within the next one hundred twenty (120) days) that are not affiliated with the Borrower and paying rent, pursuant to binding leases as to which no monetary default has occurred and has continued unremedied for one hundred twenty (120) or more days to (b) the aggregate owned net rentable square footage of such Property.
“
OFAC
” has the meaning given that term in Section 7.1.(x).
“
Off-Balance Sheet Obligations
” means liabilities and obligations of the Parent, the Borrower, any Subsidiary or any other Person in respect of “off-balance sheet arrangements” (as defined in Item 303(a)(4)(ii) of Regulation S-K promulgated under the Securities Act) which the Parent would be required to disclose in the “Management's Discussion and Analysis of Financial Condition and Results of Operations” section of the Parent's report on Form 10-Q or Form 10-K (or their equivalents) which the Parent is required to file with the Securities and Exchange Commission (or any Governmental Authority substituted therefor).
“
Officer's Certificate
” means a certificate from a Senior Officer of the Parent certifying (i) the “Eligible Properties”, (ii) each Subsidiary owning a direct interest in each Eligible Property and (iii) the “Excluded Subsidiaries”, in each case, as of the Agreement Date.
“
Ownership Share
” means, with respect to any Subsidiary of a Person (other than a Wholly Owned Subsidiary) or any Unconsolidated Affiliate of a Person, the greater of (a) such Person's relative nominal direct and indirect ownership interest (expressed as a percentage) in such Subsidiary or Unconsolidated Affiliate or (b) subject to compliance with Section 9.4.(k), such Person's relative direct and indirect economic interest (calculated as a percentage) in such Subsidiary or Unconsolidated Affiliate determined in accordance with the applicable provisions of the declaration of trust, articles or certificate of incorporation or formation, articles of organization, partnership agreement, joint venture agreement or other applicable organizational document of such Subsidiary or Unconsolidated Affiliate.
“
Parent
” has the meaning set forth in the introductory paragraph hereof and shall include the Parent's successors and permitted assigns.
“
Parent Guaranty
” means the Parent Guaranty executed and delivered by the Parent in favor of the Administrative Agent and the Lenders and substantially in the form of
Exhibit G
.
“
Participant
” has the meaning given that term in Section 13.6.(d).
“
PBGC
” means the Pension Benefit Guaranty Corporation and any successor agency.
“
Permitted Liens
” means, with respect to any asset or property of a Person, (a) Liens securing taxes, assessments and other charges or levies imposed by any Governmental Authority (excluding any Lien imposed pursuant to any of the provisions of ERISA or pursuant to any Environmental Laws), (b) the claims of materialmen, mechanics, carriers, warehousemen or landlords for labor, materials, supplies or rentals incurred in the ordinary course of business, which, in each case, are not at the time required to be paid or discharged under Section 8.6; (c) Liens consisting of deposits or pledges made, in the ordinary course of business, in connection with, or to secure payment of, obligations under workers' compensation, unemployment insurance or similar Applicable Laws; (d) Liens consisting of encumbrances in the nature of zoning restrictions, easements, and rights or restrictions of record on the use of real property, which do not materially detract from the value of such property or impair the intended use thereof in the business of such Person; (e) the rights of tenants under leases or subleases not interfering with the ordinary conduct of business of such Person; (f) Liens in favor of the Administrative Agent for its benefit and the benefit of the Lenders, each Specified Derivatives Provider and the Issuing Bank;
and (g) Liens in existence on the Agreement Date and set forth in Schedule 1.1. hereto.
“
Person
” means any natural person, corporation, limited partnership, general partnership, joint stock company, limited liability company, limited liability partnership, joint venture, association, company, trust, bank, trust company, land trust, business trust or other organization, whether or not a legal entity, or any other non-governmental entity, or any Governmental Authority.
“
Plan
” means at any time an employee pension benefit plan (other than a Multiemployer Plan) which is covered by Title IV of ERISA or subject to the minimum funding standards under Section 412 of the Internal Revenue Code and either (i) is maintained, or contributed to, by any member of the ERISA Group for employees of any member of the ERISA Group or (ii) has at any time within the preceding five (5) years been maintained, or contributed to, by any Person which was at such time a member of the ERISA Group for employees of any Person which was at such time a member of the ERISA Group.
“
Post-Default Rate
” means, in respect of any Event of Default resulting from the principal of any Loan or any Reimbursement Obligation not being paid when due, the rate otherwise applicable
plus
an additional five percent (5%) per annum and with respect to any Event of Default resulting from any other Obligation that is not paid when due (whether at stated maturity, by acceleration, by optional or mandatory prepayment or otherwise) or any other Event of Default, a rate per annum equal to the Base Rate as in effect from time to time plus the Applicable Margin plus five percent (5%) per annum.
“
Preferred Stock
” means, 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.
“
Principal Office
” means the office of the Administrative Agent located at 608 Second Avenue S., 11
th
Floor, Minneapolis, Minnesota 55402-1916, or such other office as the Administrative Agent may notify the Borrower.
“
Principals
” means (a) Charles B. Lebovitz, John N. Foy, Ben S. Landress, Stephen Lebovitz, Michael Lebovitz, Alan Lebovitz, Augustus N. Stephas and/or Farzana Mitchell (b) any of such individual's immediate family members consisting of his spouse and his lineal descendants (whether natural or adopted), (c) a trust, partnership or other similar entity of which any of the Persons identified in
either of the immediately preceding clauses (a) or (b) are the sole beneficiaries of all of the interest therein, and (d) any Subsidiary of any of the Persons identified in any of the immediately preceding clauses (a) through (c), so long as any of the individuals identified in the immediately preceding clause (a) owns or controls at least ten percent (10%) 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 or other entity (without regard to the occurrence of any contingency).
“
Property
” means a parcel (or group of related parcels) of real property developed (or to be developed) by the Borrower, any Subsidiary or any Unconsolidated Affiliate.
“
Property Management Agreements
” means, collectively, all agreements entered into by the Borrower or any other Loan Party pursuant to which the Borrower or such other Loan Party engages a Person to advise it with respect to the management of a given Property and/or to manage a given Property.
“
Pro Rata Share
” means, as to each Lender, the ratio, expressed as a percentage of (a) the amount of such Lender's Revolving Commitment to (b) the aggregate amount of the Revolving Commitments of all Lenders; provided, however, that if at the time of determination the Revolving Commitments have terminated or been reduced to zero, the “Pro Rata Share” of each Lender shall be the ratio, expressed as a percentage of (A) the sum of the unpaid principal amount of all outstanding Revolving Loans, Swingline Loans and Letter of Credit Liabilities owing to such Lender as of such date to (B) the sum of the aggregate unpaid principal amount of all outstanding Revolving Loans, Swingline Loans and Letter of Credit Liabilities of all Lenders as of such date.
“
Purchase Money Advances
” means Indebtedness in favor of the Borrower or any Subsidiary which has been advanced to a bona fide third party in connection with an arm's length sale by the Borrower or any Subsidiary of a Property to the respective third party.
“
Rating Agency
” means S&P or Moody's.
“
Recourse Indebtedness
” means any Indebtedness of a Person that is not Non-Recourse Indebtedness.
“
Register
” has the meaning given that term in Section 13.6.(c).
“
Regulatory Change
” means, with respect to any Lender, any change effective after the Agreement Date in Applicable Law (including without limitation, Regulation D of the Board of Governors of the Federal Reserve System) or the adoption or making after such date of any interpretation, directive or request applying to a class of banks, including such Lender, of or under any Applicable Law (whether or not having the force of law and whether or not failure to comply therewith would be unlawful) by any Governmental Authority or monetary authority charged with the interpretation or administration thereof or compliance by any Lender with any request or directive regarding capital adequacy or liquidity requirements. Notwithstanding anything herein to the contrary, (a) the Dodd-Frank Wall Street Reform and Consumer Protection Act and all requests, rules, guidelines or directives thereunder or issued in connection therewith and (b) all requests, rules, guidelines or directives promulgated by the Bank for International Settlements, the Basel Committee on Banking Supervision (or any successor or similar authority) or the United States or foreign regulatory authorities, in each case pursuant to Basel III, shall in each case be deemed to be a “Regulatory Change,” regardless of the date enacted, adopted or issued.
“
Reimbursement Obligation
” means the obligation of the Borrower to reimburse the Issuing Bank for any drawing honored by the Issuing Bank under a Letter of Credit.
“
REIT
” means a Person qualifying for treatment as a “real estate investment trust” under the Internal Revenue Code.
“
Related Parties
” means, with respect to any Person, such Person's Affiliates and the partners, directors, officers, employees, agents and advisors of such Person and of such Person's Affiliates.
“
Requisite Lenders
” means, as of any date, (a) Lenders having more than fifty-one percent (51%) of the aggregate amount of the Revolving Commitments or (b) if the Lenders' Revolving Commitments have been terminated or reduced to zero, Lenders holding more than fifty-one percent (51%) of the principal amount of the aggregate outstanding Revolving Loans and Letter of Credit Liabilities; provided that (i) in determining such percentage at any given time, all then existing Defaulting Lenders will be disregarded and excluded, and the Pro Rata Shares shall be redetermined, for voting purposes only, to exclude the Pro Rata Shares of such Defaulting Lenders and (ii) at all times when two (2) or more Lenders are party to this Agreement (excluding Defaulting Lenders), the term “Requisite Lenders” shall in no event mean less than two (2) Lenders.
For purposes of this definition, a Lender shall be deemed to hold a Swingline Loan or a Letter of Credit Liability to the extent such Lender has acquired a participation therein under the terms of this Agreement and has not failed to perform its obligations in respect of such participation.
“
Restricted Payment
” means: (a) any dividend or other distribution, direct or indirect, on account of any Equity Interest of the Parent or any of its Subsidiaries now or hereafter outstanding, except a dividend payable solely in shares of that class of Equity Interest to the holders of that class; (b) any redemption, conversion, exchange, retirement, sinking fund or similar payment, purchase or other acquisition for value, direct or indirect, of any Equity Interest of the Parent or any of its Subsidiaries now or hereafter outstanding; (c) any payment or prepayment of principal of, premium, if any, or interest on, redemption, conversion, exchange, purchase, retirement, defeasance, sinking fund or similar payment with respect to, any Subordinated Debt; and (d) any payment made to retire, or to obtain the surrender of, any outstanding warrants, options or other rights to acquire any Equity Interests of the Parent or any of its Subsidiaries now or hereafter outstanding.
“
Retail Properties
” means a Property developed and operated for retail use or mixed-use.
“
Revolving Commitment
” means, as to each Lender (other than the Swingline Lender), such Lender's obligation to make Revolving Loans pursuant to Section 2.1., and to participate in Letters of Credit pursuant to Section 2.2.(i) and to participate in Swingline Loans pursuant to Section 2.3.(e). in an amount up to, but not exceeding the amount set forth for such Lender on
Schedule I
as such Lender's “Revolving Commitment Amount” or as set forth in any applicable Assignment and Assumption, or agreement executed by a Lender becoming a party hereto in accordance with Section 2.17., as the same may be reduced from time to time pursuant to Section 2.12. or increased or reduced as appropriate to reflect any assignments to or by such Lender effected in accordance with Section 13.6. or increased as appropriate to reflect any increase effected in accordance with Section 2.17.
“
Revolving Commitment Percentage
” means, as to each Lender with a Revolving Commitment, the ratio, expressed as a percentage, of (a) the amount of such Lender's Revolving Commitment to (b) the aggregate amount of the Revolving Commitments of all Lenders hereunder; provided, however, that if at the time of determination the Revolving Commitments have been terminated or been reduced to zero, the “Revolving Commitment Percentage” of each Lender with a Revolving
Commitment shall be the “Revolving Commitment Percentage” of such Lender in effect immediately prior to such termination or reduction.
“
Revolving Credit Exposure
” means, as to any Lender at any time, the aggregate principal amount at such time of its outstanding Revolving Loans and such Lender's participation in Letter of Credit Liabilities and Swingline Loans at such time.
“
Revolving Loan
” means a loan made by a Lender to the Borrower pursuant to Section 2.1.(a).
“
Revolving Note
” means a promissory note of the Borrower substantially in the form of
Exhibit H
, payable to the order of a Lender in a principal amount equal to the amount of such Lender's Revolving Commitment.
“
S&P
” means Standard & Poor's Rating Services, a Standard & Poor's Financing Services LLC business, and its successors.
“
Secured Indebtedness
” means, with respect to a Person as of a given date, the aggregate principal amount of all Indebtedness of such Person outstanding on such date that is secured in any manner by any Lien on any property, and in the case of the Parent, shall include (without duplication), the Parent's Ownership Share of the Secured Indebtedness of its Unconsolidated Affiliates.
“
Securities Act
” means the Securities Act of 1933, as amended from time to time, together with all rules and regulations issued thereunder.
“
Senior Officer
” means the Chairman, Vice Chairman, CEO and President, an Executive Vice President, Vice President - Finance, Vice President - Accounting, Chief Operating Officer, and the Chief Financial Officer of the Borrower or the Parent.
“
Significant Subsidiary
” means an Subsidiary which has assets having an aggregate book value in excess of five percent (5%) of Total Asset Value.
“
Solvent
” means, when used with respect to any Person, that (a) the fair value and the fair salable value of its assets (excluding any Indebtedness due from any affiliate of such Person) are each in excess of the fair valuation of its total liabilities (including all contingent liabilities); (b) such Person is able to pay its debts or other obligations in the ordinary course as they mature; and (c) such Person has capital not unreasonably small to carry on its business and all business in which it proposes to be engaged.
“
Specified Derivatives Contract
” means any Derivatives Contract, together with any Derivatives Support Document relating thereto, that is made or entered into at any time, or in effect at any time now or hereafter, which relate to the Obligations, whether as a result of an assignment or transfer or otherwise, between the Borrower or any Loan Party and any Specified Derivatives Provider.
“
Specified Derivatives Obligations
” means all indebtedness, liabilities, obligations, covenants and duties of the Borrower or its Subsidiaries under or in respect of any Specified Derivatives Contract, whether direct or indirect, absolute or contingent, due or not due, liquidated or unliquidated, and whether or not evidenced by any written confirmation.
“
Specified Derivatives Provider
” means any Lender, or any Affiliate of a Lender that is a party to a Derivatives Contract at the time the Derivatives Contract is entered into.
“
Specified Equity Interests
” has the meaning given that term in Section 10.2.(b).
“
Stated Amount
” means the amount available to be drawn by a beneficiary under a Letter of Credit from time to time, as such amount may be increased or reduced from time to time in accordance with the terms of such Letter of Credit.
“
Subordinated Debt
” means Indebtedness for money borrowed of the Borrower or any of its Subsidiaries that is subordinated in right of payment and otherwise to the Loans, the other Obligations and the Specified Derivatives Obligations, if any, in a manner satisfactory to the Administrative Agent in its sole and absolute discretion.
“
Subsidiary
” means, for any Person, any corporation, partnership, limited liability company or other entity of which at least a majority of the Equity Interests having by the terms thereof ordinary voting power to elect a majority of the board of directors or other individuals 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.
“
Swingline Commitment
” means the Swingline Lender's obligation to make Swingline Loans pursuant to Section 2.3.
in an amount up to, but not exceeding the amount set forth in the first sentence of Section 2.3.(a), as such amount may be reduced from time to time in accordance with the terms hereof.
“
Swingline Lender
” means Wells Fargo Bank, National Association, together with its respective successors and assigns.
“
Swingline Loan
” means a loan made by the Swingline Lender to the Borrower pursuant to Section 2.3.
“
Swingline Maturity Date
” means the date which is seven (7) Business Days prior to the Maturity Date.
“
Swingline Note
” means the promissory note of the Borrower substantially in the form of
Exhibit I
, payable to the order of the Swingline Lender in a principal amount equal to the amount of the Swingline Commitment as originally in effect and otherwise duly completed.
“
Tangible Net Worth
” means, with respect to any Person as of a given date, the stockholders' equity of such Person determined on a consolidated basis
plus
(x) increases in accumulated depreciation and amortization accrued after June 30, 2012 and (y) non-controlling interests (including redeemable non-controlling interests) in any such Person or any Subsidiary of such Person,
minus
(to the extent included when determining stockholders' equity and non-controlling interests including redeemable non-controlling interests of such Person and its Subsidiaries): (a) the amount of any write-up in the book value of any assets reflected in any balance sheet resulting from revaluation thereof or any write up in excess of the cost of such assets acquired (but excluding any such write-up for purchase price adjustments of acquisition properties based on GAAP), and (b) the aggregate of all amounts appearing on any such balance sheet for franchises, licenses, permits, patents, patent applications, copyrights, trademarks, service marks, trade names, goodwill, treasury stock, experimental or organizational expenses and other like assets which would be classified as intangible assets under GAAP (including net lease intangibles) all
determined as of such date on a consolidated basis, and (c) accumulated other comprehensive income (or loss).
“
Taxes
” has the meaning given that term in Section 3.10.
“
Tenant Lease
” means any lease entered into by the Borrower, any Loan Party or any Subsidiary with respect to any portion of a Property.
“
Third Party Affiliate
” means any Person which owns any interest in Parent, Borrower or any Subsidiary or Unconsolidated Affiliate of Borrower, but which Person is neither a Senior Officer nor a Subsidiary of Borrower.
“
Total Asset Value
” means, at a given time, the sum (without duplication) of all of the following of the Parent and its Subsidiaries determined on a consolidated basis in accordance with GAAP applied on a consistent basis: (a) cash and Cash Equivalents (other than tenant deposits and other cash and Cash Equivalents that are subject to a Lien or a Negative Pledge or the disposition of which is restricted in any way, but
including
any escrow deposits for real estate taxes, insurance, tenant allowances and capital expenditures);
plus
(b) the quotient of (i) EBITDA of the Parent and its Subsidiaries calculated for the immediately preceding period of four (4) consecutive fiscal quarters for (x) Properties owned for four (4) or more quarters and (y) Properties owned for fewer than four (4) quarters that have achieved an Occupancy Rate of eighty-five percent (85%) or more, calculated on an annualized basis (excluding EBITDA attributable from assets in (c), (d), (e), (f), (g), (h) and (i) below),
divided by
(ii) the Capitalization Rate; provided that, for purposes of calculating Total Asset Value only, “EBITDA” may include straight line rent leveling adjustments;
plus
(c) the undepreciated GAAP book value of Properties acquired during the four (4) fiscal quarters most recently ended;
plus
(d) the GAAP book value of all Development Properties;
plus
(e) the GAAP book value of Unimproved Land,
plus
(f) the GAAP book value of Mortgages Receivable and Purchase Money Advances;
plus
(g) the GAAP book value of Equity Interests; plus (h) with respect to any purchase obligation, repurchase obligation or forward commitment evidenced by a binding contract included when determining the Indebtedness of the Parent and its Subsidiaries, the reasonably determined value of any amount that would be payable, or property that would be transferable, to the Parent or any Subsidiary as if such contract were closed as of such date; plus (i) to the extent not included in the immediately preceding clauses (a) through (h), the value of any real property owned by a Subsidiary (that is not a Wholly Owned Subsidiary) of the Borrower or an Unconsolidated Affiliate of the Borrower (such Subsidiary or Unconsolidated Affiliate being a "JV"), to the extent the Borrower or a Subsidiary guarantees the Indebtedness of any JV in an amount in excess of its ownership ratio in such JV, provided that if such Indebtedness is paid by the Borrower or a Subsidiary of the Borrower, then the Borrower or a Subsidiary of the Borrower shall automatically acquire, without the necessity of any further payment or action, all Equity Interests in such JV not owned by the Borrower or any Subsidiary. The Borrower's Ownership Share of assets held by Unconsolidated Affiliates (excluding assets of the type described in the immediately preceding clause (a)) will be included in the calculation of Total Asset Value consistent with the above described treatment for wholly owned assets. EBITDA attributable to Properties disposed of during the fiscal quarter ending immediately prior to any date of determination of Total Asset Value shall not be included in the calculation of Total Asset Value. Notwithstanding the foregoing, for purposes of determining Total Asset Value, to the extent the amount of Total Asset Value attributable to Properties leased under Ground Leases would exceed ten percent (10%) of Total Asset Value, such excess shall be excluded.
“
Total Budgeted Cost
” means, with respect to a Development Property, and at any time, the aggregate amount of all costs budgeted to be paid, incurred or otherwise expended or accrued by the
Borrower, a Subsidiary or an Unconsolidated Affiliate with respect to such Property to achieve an Occupancy Rate of one hundred percent (100%), including without limitation, all amounts budgeted with respect to all of the following: (a) acquisition of land and any related improvements; (b) a reasonable and appropriate reserve for construction interest; (c) a reasonable and appropriate operating deficit reserve; (d) tenant improvements, (e) leasing commissions and (f) other hard and soft costs associated with the development or redevelopment of such Property; provided, however, Total Budgeted Cost shall be reduced by cash actually received by Borrower, such Subsidiary or such Unconsolidated Affiliate as a result of governmental reimbursements or in connection with the sale of outparcels. With respect to any Property to be developed in more than one phase, the Total Budgeted Cost shall exclude budgeted costs (other than costs relating to acquisition of land and related improvements) to the extent relating to any phase for which (i) construction has not yet commenced and (ii) a binding construction contract has not been entered into by the Borrower, any other Subsidiary or any Unconsolidated Affiliate, as the case may be.
“
Total Indebtedness
” means all Indebtedness of the Parent and its Ownership Share of all Indebtedness of all of its Subsidiaries.
“
Transfer Authorizer Designation Form
” means a form substantially in the form of
Exhibit J
to be delivered to the Administrative Agent pursuant to Section 6.1., as the same may be amended, restated or modified from time to time with the prior written approval of the Administrative Agent.
“
Type
” with respect to any Loan, refers to whether such Loan or portion thereof is a LIBOR Loan or a Base Rate Loan.
“
Unconsolidated Affiliate
” means, with respect to any Person, any other Person in whom such Person holds, either directly or indirectly through one or more Subsidiaries, an Investment, which Investment is accounted for in the financial statements of such Person on an equity basis of accounting and whose financial results would not be consolidated under GAAP with the financial results of such Person on the consolidated financial statements of such Person.
“
Unencumbered Asset Value
” means the sum of (1) (a) (i) the sum of (x) the NOI (excluding NOI attributable to Development Properties) for Eligible Properties owned for four (4) or more quarters for the immediately preceding period of four (4) consecutive fiscal quarters plus (y) the NOI (excluding NOI attributable to Development Properties) for Eligible Properties owned for less than four (4) quarters that have achieved an Occupancy Rate of eighty-five percent (85%) or more, calculated on an annualized basis, divided by (ii) the Capitalization Rate, plus (b) the undepreciated GAAP book value of all Eligible Properties acquired during the four (4) fiscal quarters most recently ended, plus (c) cash and Cash Equivalents (other than tenant deposits and other cash and Cash Equivalents that are subject to a Lien or a Negative Pledge or the disposition of which is restricted in any way), plus (d) the GAAP book value of Unimproved Land (which meets the requirements for Eligible Property) that is not subject to any Lien (other than Permitted Liens (but not Permitted Liens described in clause (g) of the definition of that term)) or any Negative Pledge, plus (e) the GAAP book value of Mortgages Receivable that are not subject to any Lien (other than Permitted Liens (but not Permitted Liens described in clause (g) of the definition of that term)) or any Negative Pledge, plus (f) the GAAP book value of Purchase Money Advances that are not subject to any Lien (other than Permitted Liens (but not Permitted Liens described in clause (g) of the definition of that term)) or any Negative Pledge, plus (g) the GAAP book value of Development Properties (which meets the requirements for Eligible Property) that are not subject to any Lien (other than Permitted Liens (but not Permitted Liens described in clause (g) of the definition of that term)) or any Negative Pledge, plus (h) Equity Interests that are not subject to any Lien (other than Permitted Liens
described in clause (f) of the definition of that term) or any Negative Pledge, plus (2) Borrower's Ownership Share of value, calculated as in clause (1)(a) above, of non-wholly owned Properties that are not subject to any Lien or any Negative Pledge. Notwithstanding the above, the percentage of Unencumbered Asset Value attributable to Properties subject to a Ground Lease will not exceed ten percent (10%) of the Unencumbered Asset Value. For purposes of this definition, (i) to the extent the Unencumbered Asset Value attributable to clause (1)(d) would exceed five percent (5%) of the Unencumbered Asset Value, such excess shall be excluded, (ii) to the extent the Unencumbered Asset Value attributable to clause (1)(e) would exceed five percent (5%) of the Unencumbered Asset Value, such excess shall be excluded, (iii) to the extent the Unencumbered Asset Value attributable to clause (1)(f) would exceed five percent (5%) of the Unencumbered Asset Value, such excess shall be excluded, (iv) to the extent the Unencumbered Asset Value attributable to clause (1)(g) would exceed ten percent (10%) of the Unencumbered Asset Value, such excess shall be excluded, (v) to the extent the Unencumbered Asset Value attributable to clause (1)(h) would exceed five percent (5%) of the Unencumbered Asset Value, such excess shall be excluded, (vi) to the extent the Unencumbered Asset Value attributable to clause (2) would exceed fifteen percent (15%) of the Unencumbered Asset Value, such excess shall be excluded, (vii) to the extent the Unencumbered Asset Value attributable to the sum of (d), (e), (f), (g) and (h) of clause (1) and clause (2) would exceed twenty percent (20%) of the Unencumbered Asset Value, such excess shall be excluded and (vii) to the extent the Unencumbered Asset Value attributable to hotel and office properties would exceed five percent (5%) of the Unencumbered Asset Value, such excess shall be excluded.
“
Unencumbered NOI
” means, for any period, the sum of NOI from (i) all Eligible Properties plus (ii) Borrower's Ownership Share of NOI of any non-wholly owned Properties to the extent such Properties are included in the calculation of Unencumbered Asset Value and are not subject to any Lien or any Negative Pledge.
“
Unfunded Liabilities
” means, with respect to any Plan at any time, the amount (if any) by which (a) the value of all benefit liabilities under such Plan, determined on a plan termination basis using the assumptions prescribed by the PBGC for purposes of Section 4044 of ERISA, exceeds (b) the fair market value of all Plan assets allocable to such liabilities under Title IV of ERISA (excluding any accrued but unpaid contributions), all determined as of the then most recent valuation date for such Plan, but only to the extent that such excess represents a potential liability of a member of the ERISA Group to the PBGC or any other Person under Title IV of ERISA.
“
Unimproved Land
” means land on which no development (other than improvements that are not material and are temporary in nature) has occurred and for which no development is scheduled in the following twelve (12) months; provided, however, the term Unimproved Land shall not include (a) raw land subject to a Ground Lease under which the Borrower or a Subsidiary is the lessor and a Person not an Affiliate is the lessee; (b) any Development Property, (c) unimproved real estate acquired within the prior eighteen (18) months that will become a Development Property within eighteen (18) months of its acquisition (the Borrower acknowledging that if such Property does not become a Development Property within said eighteen (18) months period, such Property shall thereafter be considered unimproved real estate for purposes of this definition unless and until such Property in fact becomes a Development Property), (d) land subject to a binding contract of sale under which the Borrower or one of its Subsidiaries is the seller and the buyer is not an Affiliate of the Borrower, or (e) out-parcels held for lease or sale at Properties which are either completed or where development has commenced).
“
Unsecured Indebtedness
” means, with respect to a Person, Indebtedness of such Person that is not Secured Indebtedness; provided, however, that any Indebtedness that is secured only by a pledge of Equity Interests shall be deemed to be Unsecured Indebtedness.
“
Unsecured Interest Expense
” means, with respect to a Person and for any period, all Interest Expense of such Person for such Period attributable to Unsecured Indebtedness.
“
Wells Fargo
” means Wells Fargo Bank, National Association, and its successors and permitted assigns.
“
Wholly Owned Subsidiary
” means any Subsidiary of a Person in respect of which all of the Equity Interests (other than, in the case of a corporation, directors' qualifying shares) are at the time directly or indirectly owned or controlled by such Person or one or more other Subsidiaries of such Person or by such Person and one or more other Subsidiaries of such Person.
Section 1.2
General; References to Central Time.
Unless otherwise indicated, all accounting terms, ratios and measurements shall be interpreted or determined in accordance with GAAP as in effect on the Agreement Date; provided that, if at any time any change in GAAP would affect the computation of any financial ratio or requirement set forth in any Loan Document, Borrower shall give Administrative Agent written notice thereof promptly after Borrower has knowledge thereof, and if either the Borrower or the Requisite Lenders shall so request, the Administrative Agent, the Lenders and the Borrower shall negotiate in good faith to amend such ratio or requirement to preserve the original intent thereof in light of such change in GAAP (subject to the approval of the Requisite Lenders); provided further that, until so amended, (i) such ratio or requirement shall continue to be computed in accordance with GAAP prior to such change therein and (ii) the Borrower shall provide to the Administrative Agent and the Lenders financial statements and other documents required under this Agreement or as reasonably requested hereunder setting forth a reconciliation between calculations of such ratio or requirement made before and after giving effect to such change in GAAP. Notwithstanding the preceding sentence, the calculation of liabilities shall not include any fair value adjustments to the carrying value of liabilities to record such liabilities at fair value pursuant to electing the fair value option election under FASB ASC 825-10-25 (formerly known as FAS 159, The Fair Value Option for Financial Assets and Financial Liabilities) or other FASB standards allowing entities to elect fair value option for financial liabilities. Accordingly, the amount of liabilities shall be the historical cost basis, which generally is the contractual amount owed adjusted for amortization or accretion of any premium or discount. References in this Agreement to “Sections”, “Articles”, “Exhibits” and “Schedules” are to sections, articles, exhibits and schedules herein and hereto unless otherwise indicated. references in this Agreement to any document, instrument or agreement (a) shall include all exhibits, schedules and other attachments thereto, (b) shall include all documents, instruments or agreements issued or executed in replacement thereof, to the extent permitted hereby and (c) shall mean such document, instrument or agreement, or replacement or predecessor thereto, as amended, supplemented, restated or otherwise modified from time to time to the extent not otherwise stated herein or prohibited hereby and in effect at any given time. Wherever from the context it appears appropriate, each term stated in either the singular or plural shall include the singular and plural, and pronouns stated in the masculine, feminine or neuter gender shall include the masculine, the feminine and the neuter. Unless explicitly set forth to the contrary, a reference to “Subsidiary” means a Subsidiary of the Parent or the Borrower (or a Subsidiary of such Subsidiary) and a reference to an “Affiliate” means a reference to an Affiliate of the Borrower or the Parent. Titles and captions of Articles, Sections, subsections and clauses in this Agreement are for convenience only, and neither limit nor amplify
the provisions of this Agreement. Unless otherwise indicated, all references to time are references to Central time.
Section 1.3
Financial Attributes of Non-Wholly Owned Subsidiaries.
When determining the Applicable Margin and compliance by the Parent or the Borrower with any financial covenant contained in any of the Loan Documents (a) only the Ownership Share of the Parent or the Borrower, as applicable, of the financial attributes of a Subsidiary that is not a Wholly Owned Subsidiary shall be included and (b) the Parent's Ownership Share of the Borrower shall be deemed to be one hundred percent (100.0%).
Article II. Credit Facility
Section 2.1.
Revolving Loans.
(a)
Making of Revolving Loans
. Subject to the terms and conditions set forth in this Agreement, including without limitation, Section 2.15.
below, each Lender severally and not jointly agrees to make Revolving Loans to the Borrower during the period from and including the Effective Date to but excluding the Maturity Date, in an aggregate principal amount at any one time outstanding up to, but not exceeding, such Lender's Revolving Commitment; provided, however Revolving Loans shall not be made if restricted by the amount limitations set forth in Section 2.15. Each borrowing of Revolving Loans hereunder shall be in an aggregate principal amount of $100,000 and integral multiples of $1,000 in excess of that amount (except that, subject to Section 2.15., any such borrowing of Revolving Loans may be in the aggregate amount of the Revolving Commitments of all Lenders
minus
the sum of the aggregate principal balance of all Revolving Loans outstanding and the Letter of Credit Liabilities, which Revolving Loans, if less than $100,000, must be Base Rate Loans). Within the foregoing limits and subject to the terms and conditions of this Agreement, the Borrower may borrow, repay and reborrow Revolving Loans.
(b)
Requests for Revolving Loans
. Not later than 11:00 a.m. Central time at least one (1) Business Day prior to a borrowing of Base Rate Loans and not later than 11:00 a.m. Central time at least three (3) Business Days prior to a borrowing of LIBOR Loans, the Borrower shall deliver to the Administrative Agent a Notice of Borrowing. Each Notice of Borrowing shall specify the aggregate principal amount of the Revolving Loans to be borrowed, the date such Revolving Loans are to be borrowed (which must be a Business Day), the Type of the requested Revolving Loans, and if such Revolving Loans are to be LIBOR Loans, the initial Interest Period for such Revolving Loans. Each Notice of Borrowing shall be irrevocable once given and binding on the Borrower. If the Borrower fails to indicate the Type of Revolving Loans being borrowed in a Notice of Borrowing, then the Borrower shall be deemed to have requested a borrowing of LIBOR Loans having an Interest Period of one month. Prior to delivering a Notice of Borrowing, the Borrower may (without specifying whether a Revolving Loan will be a Base Rate Loan or a LIBOR Loan) request that the Administrative Agent provide the Borrower with the most recent LIBOR available to the Administrative Agent. The Administrative Agent shall provide such quoted rate to the Borrower on the date of such request or as soon as possible thereafter.
(c)
Funding of Revolving Loans
. Promptly after receipt of a Notice of Borrowing under the immediately preceding subsection (b),
the Administrative Agent shall notify each Lender of the proposed borrowing. Each Lender shall deposit an amount equal to the Revolving Loan to be made by such Lender to the Borrower with the Administrative Agent at the Principal Office, in immediately available funds not later than 11:00 a.m. Central time on the date of such proposed Revolving Loans. Subject to fulfillment
of all applicable conditions set forth herein, the Administrative Agent shall make available to the Borrower in the account specified in the Transfer Authorizer Designation Form, not later than 1:00 p.m. Central time on the date of the requested borrowing of Revolving Loans, the proceeds of such amounts received by the Administrative Agent. No Lender shall be responsible for the failure of any other Lender to make a Loan or to perform any other obligation to be made or performed by such other Lender hereunder, and the failure of any Lender to make a Loan or to perform any other obligation to be made or performed by it hereunder shall not relieve the obligation of any other Lender to make any Loan or to perform any other obligation to be made or performed by such other Lender.
(d)
Assumptions Regarding Funding by Lenders
. With respect to Revolving Loans to be made after the Effective Date, unless the Administrative Agent shall have been notified by any Lender that such Lender will not make available to the Administrative Agent a Revolving Loan to be made by such Lender in connection with any borrowing, the Administrative Agent may assume that such Lender will make the proceeds of such Revolving Loan available to the Administrative Agent in accordance with this Section, and the Administrative Agent may (but shall not be obligated to), in reliance upon such assumption, make available to the Borrower the amount of such Revolving Loan to be provided by such Lender. In such event, if such Lender does not make available to the Administrative Agent the proceeds of such Revolving Loan, then such Lender and the Borrower severally agree to pay to the Administrative Agent within three (3) Business Days following written demand the amount of such Revolving Loan with interest thereon, for each day from and including the date such Revolving Loan is made available to the Borrower but excluding the date of payment to the Administrative Agent, at (i) in the case of a payment to be made by such Lender, the greater of the Federal Funds Rate and a rate determined by the Administrative Agent in accordance with banking industry rules on interbank compensation and (ii) in the case of a payment to be made by the Borrower, the interest rate applicable to Base Rate Loans. If the Borrower and such Lender shall pay the amount of such interest to the Administrative Agent for the same or overlapping period, the Administrative Agent shall promptly remit to the Borrower the amount of such interest paid by the Borrower for such period. If such Lender pays to the Administrative Agent the amount of such Revolving Loan, the amount so paid shall constitute such Lender's Revolving Loan included in the borrowing. Any payment by the Borrower shall be without prejudice to any claim the Borrower may have against a Lender that shall have failed to make available the proceeds of a Revolving Loan to be made by such Lender.
Section 2.2
Letters of Credit.
(a)
Letters of Credit
. Subject to the terms and conditions of this Agreement, including without limitation, Section 2.15., the Issuing Bank, on behalf of the Lenders, agrees to issue for the account of the Borrower during the period from and including the Effective Date to, but excluding, the date thirty (30) days prior to the Maturity Date, one or more standby letters of credit (each a “Letter of Credit”) up to a maximum aggregate Stated Amount at any one time outstanding not to exceed $50,000,000 as such amount may be reduced from time to time in accordance with the terms hereof (the “L/C Commitment Amount”).
(b)
Terms of Letters of Credit
. At the time of issuance, the amount, form, terms and conditions of each Letter of Credit, and of any drafts or acceptances thereunder, shall be subject to approval by the Issuing Bank and the Borrower. Notwithstanding the foregoing, in no event may (i) the expiration date of any Letter of Credit extend (except to the extent permitted under Section 2.14), beyond the Maturity Date, or (ii) any Letter of Credit have an initial duration in excess of one year; provided, however, a Letter of Credit may contain a provision providing for the automatic extension of the expiration date in the absence of a notice of non-renewal from the Issuing Bank but in no event shall any
such provision permit the extension of the expiration date of such Letter of Credit beyond the date that is thirty (30) days prior to the Maturity Date. The initial Stated Amount of each Letter of Credit shall be at least $200,000 (or such lesser amount as may be acceptable to the applicable Issuing Bank, the Administrative Agent and the Borrower).
(c)
Requests for Issuance of Letters of Credit
. The Borrower shall give the Issuing Bank and the Administrative Agent written notice at least four (4) Business Days prior (or such shorter period as may be mutually agreed by the Borrower and the Issuing Bank) to the requested date of issuance of a Letter of Credit, such notice to describe in reasonable detail the proposed terms of such Letter of Credit and the nature of the transactions or obligations proposed to be supported by such Letter of Credit, and in any event shall set forth with respect to such Letter of Credit the proposed (i) initial Stated Amount, (ii) beneficiary, and (iii) expiration date. The Borrower shall also execute and deliver such customary applications and agreements for standby letters of credit, and other forms as requested from time to time by the Issuing Bank. Provided the Borrower has given the notice prescribed by the first sentence of this subsection and delivered such applications and agreements referred to in the preceding sentence, subject to the other terms and conditions of this Agreement, including the satisfaction of any applicable conditions precedent set forth in Article 6.2., the Issuing Bank shall issue the requested Letter of Credit on the requested date of issuance for the benefit of the stipulated beneficiary but in any event no later than the date four (4) Business Days following the date after which the Issuing Bank has received all of the items required to be delivered to it under this subsection. The Issuing Bank shall not at any time be obligated to issue any Letter of Credit if such issuance would conflict with, or cause the Issuing Bank or any Lender to exceed any limits imposed by, any Applicable Law. References herein to “issue” and derivations thereof with respect to Letters of Credit shall also include extensions or modifications of any outstanding Letters of Credit, unless the context otherwise requires. Upon the written request of the Borrower, the Issuing Bank shall deliver to the Borrower a copy of (i) any Letter of Credit proposed to be issued hereunder prior to the issuance thereof and (ii) each issued Letter of Credit within a reasonable time after the date of issuance thereof. To the extent any term of a Letter of Credit Document is inconsistent with a term of any Loan Document, the term of such Loan Document shall control.
(d)
Reimbursement Obligations
. Upon receipt by the Issuing Bank from the beneficiary of a Letter of Credit of any demand for payment under such Letter of Credit, the Issuing Bank shall promptly notify the Borrower and the Administrative Agent of the amount to be paid by the Issuing Bank as a result of such demand and the date on which payment is to be made by the Issuing Bank to such beneficiary in respect of such demand; provided, however, that the Issuing Bank's failure to give, or delay in giving, such notice shall not discharge the Borrower in any respect from the applicable Reimbursement Obligation. The Borrower hereby absolutely, unconditionally and irrevocably agrees to pay and reimburse the Issuing Bank for the amount of each demand for payment under such Letter of Credit at or prior to the date on which payment is to be made by the Issuing Bank to the beneficiary thereunder, without presentment, demand, protest or other formalities of any kind. Upon receipt by the Issuing Bank of any payment in respect of any Reimbursement Obligation, the Issuing Bank shall promptly pay to each Lender that has acquired a participation therein under the second sentence of the immediately following subsection (i) such Lender's Revolving Commitment Percentage of such payment.
(e)
Manner of Reimbursement
. Upon its receipt of a notice referred to in the immediately preceding subsection (d), the Borrower shall advise the Administrative Agent and the Issuing Bank whether or not the Borrower intends to borrow hereunder to finance its obligation to reimburse the
Issuing Bank for the amount of the related demand for payment and, if it does, the Borrower shall submit a timely request for such borrowing as provided in the applicable provisions of this Agreement. If the Borrower fails to so advise the Administrative Agent and the Issuing Bank, or if the Borrower fails to reimburse the Issuing Bank for a demand for payment under a Letter of Credit by the date of such payment, the failure of which the Issuing Bank shall promptly notify the Administrative Agent, then (i) if the applicable conditions contained in Article VI. would permit the making of Revolving Loans, the Borrower shall be deemed to have requested a borrowing of Revolving Loans (which shall be Base Rate Loans) in an amount equal to the unpaid Reimbursement Obligation and the Administrative Agent shall give each Lender prompt notice thereof and of the amount of the Revolving Loan to be made available to the Administrative Agent not later than 12:00 p.m. Central time and (ii) if such conditions would not permit the making of Revolving Loans, the provisions of subsection (j) of this Section shall apply. The limitations set forth in the second sentence of Section 2.1.(a) shall not apply to any borrowing of Base Rate Loans under this subsection.
(f)
Effect of Letters of Credit on Revolving Commitments
. Upon the issuance by the Issuing Bank of any Letter of Credit and until such Letter of Credit shall have expired or been cancelled, the Revolving Commitment of each Lender shall be deemed to be utilized for all purposes of this Agreement in an amount equal to the product of (i) such Lender's Revolving Commitment Percentage and (ii) the sum of (A) the Stated Amount of such Letter of Credit plus (B) any related Reimbursement Obligations then outstanding.
(g)
Issuing Bank's Duties Regarding Letters of Credit; Unconditional Nature of Reimbursement Obligations
. In examining documents presented in connection with drawings under Letters of Credit and making payments under such Letters of Credit against such documents, the Issuing Bank shall only be required to use the same standard of care as it uses in connection with examining documents presented in connection with drawings under letters of credit in which it has not sold participations and making payments under such letters of credit. The Borrower assumes all risks of the acts and omissions of, or misuse of the Letters of Credit by, the respective beneficiaries of such Letters of Credit. In furtherance and not in limitation of the foregoing, none of the Issuing Bank, Administrative Agent or any of the Lenders shall be responsible for, and the Borrower's obligations in respect of Letters of Credit shall not be affected in any manner by, (i) the form, validity, sufficiency, accuracy, genuineness or legal effects of any document submitted by any party in connection with the application for and issuance of or any drawing honored under any Letter of Credit even if such document should in fact prove to be in any or all respects invalid, insufficient, inaccurate, fraudulent or forged; (ii) the validity or sufficiency of any instrument transferring or assigning or purporting to transfer or assign any Letter of Credit, or the rights or benefits thereunder or proceeds thereof, in whole or in part, which may prove to be invalid or ineffective for any reason; (iii) failure of the beneficiary of any Letter of Credit to comply fully with conditions required in order to draw upon such Letter of Credit (provided, however, the within limitation shall not affect Issuing Bank's liability for paying a drawing under any Letter of Credit when the beneficiary of such Letter of Credit has not substantially complied with the requirements imposed by such Letter of Credit for such drawing; provided further, Issuing Bank shall have no duty to verify the existence or reasonableness of any act or condition referenced in or in connection with, or any statement in or in connection with, any drawing or presentment under any Letter of Credit); (iv) errors, omissions, interruptions or delays in transmission or delivery of any messages, by mail, cable, facsimile, electronic mail, telecopy or otherwise, whether or not they be in cipher; (v) errors in interpretation of technical terms; (vi) any loss or delay in the transmission or otherwise of any document required in order to make a drawing under any Letter of Credit, or of the proceeds thereof; (vii) the misapplication by the beneficiary of any Letter of Credit, or of the proceeds of any drawing under any Letter of Credit; or (viii) any consequences arising from causes beyond the control of the Issuing Bank, Administrative Agent or the Lenders. None of the above shall affect, impair or prevent the vesting of any of the Issuing Bank's or Administrative Agent's rights or powers hereunder. Any action taken or omitted to be taken by the Issuing Bank under or in connection with any Letter of Credit, if taken or omitted in the absence of gross
negligence or willful misconduct (as determined by a court of competent jurisdiction in a final, non-appealable judgment), shall not create against the Issuing Bank any liability to the Borrower, the Administrative Agent or any Lender. In this connection, the obligation of the Borrower to reimburse the Issuing Bank for any drawing made under any Letter of Credit, and to repay any Revolving Loan made pursuant to the second sentence of the immediately preceding subsection (e), shall be absolute, unconditional and irrevocable and shall be paid strictly in accordance with the terms of this Agreement or any other applicable Letter of Credit Document under all circumstances whatsoever, including without limitation, the following circumstances: (A) any lack of validity or enforceability of any Letter of Credit Document or any term or provisions therein; (B) any amendment or waiver of or any consent to departure from all or any of the Letter of Credit Documents; (C) the existence of any claim, setoff, defense or other right which the Borrower may have at any time against the Issuing Bank, the Administrative Agent or any Lender, any beneficiary of a Letter of Credit or any other Person, whether in connection with this Agreement, the transactions contemplated hereby or in the Letter of Credit Documents or any unrelated transaction; (D) any breach of contract or dispute between the Borrower, the Issuing Bank, the Administrative Agent, any Lender or any other Person; (E) any demand, statement or any other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein or made in connection therewith being untrue or inaccurate in any respect whatsoever; (F) any non-application or misapplication by the beneficiary of a Letter of Credit or of the proceeds of any drawing under such Letter of Credit; (G) payment by the Issuing Bank under any Letter of Credit against presentation of a draft or certificate which does not strictly comply, but which does substantially comply, with the terms of such Letter of Credit; and (H) any other act, omission to act, delay or circumstance whatsoever that might, but for the provisions of this Section, constitute a legal or equitable defense to or discharge of the Borrower's Reimbursement Obligations.
(h)
Amendments, Etc
. The issuance by the Issuing Bank of any amendment, supplement or other modification to any Letter of Credit shall be subject to the same conditions applicable under this Agreement to the issuance of new Letters of Credit (including, without limitation, that the request therefor be made through the Issuing Bank), and no such amendment, supplement or other modification shall be issued unless either (i) the respective Letter of Credit affected thereby would have complied with such conditions had it originally been issued hereunder in such amended, supplemented or modified form or (ii) the Administrative Agent and Requisite Lenders (or all of the Lenders if required by Section 13.7.) shall have consented thereto. In connection with any such amendment, supplement or other modification, the Borrower shall pay the fees, if any, payable under the last sentence of Section 3.5.(c).
(i)
Lenders' Participation in Letters of Credit
. Immediately upon the issuance by the Issuing Bank of any Letter of Credit each Lender shall be deemed to have absolutely, irrevocably and unconditionally purchased and received from the Issuing Bank, without recourse or warranty, an undivided interest and participation to the extent of such Lender's Revolving Commitment Percentage of the liability of the Issuing Bank with respect to such Letter of Credit and each Lender thereby shall absolutely, unconditionally and irrevocably assume, as primary obligor and not as surety, and shall be unconditionally obligated to the Issuing Bank to pay and discharge when due, such Lender's Revolving Commitment Percentage of the Issuing Bank's liability under such Letter of Credit. In addition, upon the making of each payment by a Lender to the Administrative Agent for the account of the Issuing Bank in respect of any Letter of Credit pursuant to the immediately following subsection (j), such Lender shall, automatically and without any further action on the part of the Issuing Bank, Administrative Agent or such Lender, acquire (i) a participation in an amount equal to such payment in the Reimbursement Obligation owing to the Issuing Bank by the Borrower in respect of such Letter of Credit and (ii) a participation in a percentage equal to such Lender's Revolving Commitment Percentage in any interest or
other amounts payable by the Borrower in respect of such Reimbursement Obligation (other than the Fees payable to the Issuing Bank pursuant to the second and the last sentences of Section 3.5.(c)).
(j)
Payment Obligation of Lenders
. Each Lender severally agrees to pay to the Administrative Agent, for the account of the Issuing Bank, on demand in immediately available funds in Dollars the amount of such Lender's Revolving Commitment Percentage of each drawing paid by the Issuing Bank under each Letter of Credit to the extent such amount is not reimbursed by the Borrower pursuant to the immediately preceding subsection (d); provided, however, that in respect of any drawing under any Letter of Credit, the maximum amount that any Lender shall be required to fund, whether as a Revolving Loan or as a participation, shall not exceed such Lender's Revolving Commitment Percentage of such drawing. If the notice referenced in the second sentence of Section 2.4.(e) is received by a Lender not later than 11:00 a.m. Central time, then such Lender shall make such payment available to the Administrative Agent not later than 2:00 p.m. Central time on the date of demand therefor; otherwise, such payment shall be made available to the Administrative Agent not later than 1:00 p.m. Central time on the next succeeding Business Day. Each Lender's obligation to make such payments to the Administrative Agent under this subsection, and the Administrative Agent's right to receive the same for the account of the Issuing Bank, shall be absolute, irrevocable and unconditional and shall not be affected in any way by any circumstance whatsoever, including without limitation, (i) the failure of any other Lender to make its payment under this subsection, (ii) the financial condition of the Borrower, the Parent or any other Loan Party, (iii) the existence of any Default or Event of Default, including any Event of Default described in Sections 11.1.(e) or (f) or (iv) the termination of the Revolving Commitments. Each such payment to the Administrative Agent for the account of the Issuing Bank shall be made without any offset, abatement, withholding or deduction whatsoever.
(k)
Information to Lenders
. Promptly following any change in Letters of Credit outstanding, the Issuing Bank shall deliver to the Administrative Agent, who shall promptly deliver the same to each Lender and the Borrower a notice describing the aggregate amount of all Letters of Credit outstanding at such time. Upon the request of any Lender from time to time, the Issuing Bank shall deliver any other information reasonably requested by such Lender with respect to each Letter of Credit then outstanding. Other than as set forth in this subsection, the Issuing Bank shall have no duty to notify the Lenders regarding the issuance or other matters regarding Letters of Credit issued hereunder. The failure of the Issuing Bank to perform its requirements under this subsection shall not relieve any Lender from its obligations under the immediately preceding subsection (j).
Section 2.3
Swingline Loans.
(a)
Swingline Loans
. Subject to the terms and conditions hereof, including without limitation Section 2.15., the Swingline Lender agrees to make Swingline Loans to the Borrower, during the period from the Effective Date to but excluding the Swingline Maturity Date, in an aggregate principal amount at any one time outstanding up to, but not exceeding, $30,000,000, as such amount may be reduced from time to time in accordance with the terms hereof. If at any time the aggregate principal amount of the Swingline Loans outstanding at such time exceeds the Swingline Commitment in effect at such time, the Borrower shall immediately pay the Administrative Agent for the account of the Swingline Lender the amount of such excess. Subject to the terms and conditions of this Agreement, the Borrower may borrow, repay and reborrow Swingline Loans hereunder. The borrowing of a Swingline Loan shall not constitute usage of any Lender's Revolving Commitment for purposes of calculation of the fee payable under Section 3.5.(b).
(b)
Procedure for Borrowing Swingline Loans
. The Borrower shall give the Administrative Agent and the Swingline Lender notice pursuant to a Notice of Swingline Borrowing or telephonic notice of each borrowing of a Swingline Loan. Each Notice of Swingline Borrowing shall be delivered to the Swingline Lender no later than 11:00 a.m. Central time on the proposed date of such borrowing. Any telephonic notice shall include all information to be specified in a written Notice of Swingline Borrowing and shall be promptly confirmed in writing by the Borrower pursuant to a Notice of Swingline Borrowing sent to the Swingline Lender by telecopy on the same day of the giving of such telephonic notice. Not later than 1:00 p.m. Central time on the date of the requested Swingline Loan and subject to satisfaction of the applicable conditions set forth in Article 6.2. for such borrowing, the Swingline Lender will make the proceeds of such Swingline Loan available to the Borrower in Dollars, in immediately available funds, at the account specified by the Borrower in the Notice of Swingline Borrowing.
(c)
Interest
. Swingline Loans shall bear interest at a per annum rate equal to the Base Rate as in effect from time to time plus the Applicable Margin or at such other rate or rates as the Borrower and the Swingline Lender may agree from time to time in writing. Interest on Swingline Loans is solely for the account of the Swingline Lender (except to the extent a Lender acquires a participating interest in a Swingline Loan pursuant to the following subsection (e)). All accrued and unpaid interest on Swingline Loans shall be payable on the dates and in the manner provided in Section 2.4. with respect to interest on Base Rate Loans (except as the Swingline Lender and the Borrower may otherwise agree in writing in connection with any particular Swingline Loan).
(d)
Swingline Loan Amounts, Etc
. Each Swingline Loan shall be in the minimum amount of $100,000 and integral multiples of $1,000 in excess thereof, or such other minimum amounts agreed to by the Swingline Lender and the Borrower. Any voluntary prepayment of a Swingline Loan must be in integral multiples of $100,000 or the aggregate principal amount of all outstanding Swingline Loans (or such other minimum amounts upon which the Swingline Lender and the Borrower may agree) and in connection with any such prepayment, the Borrower must give the Swingline Lender and the Administrative Agent prior written notice thereof no later than 12:00 p.m. Central time on the day prior to the date of such prepayment. The Swingline Loans shall, in addition to this Agreement, be evidenced by the Swingline Note.
(e)
Repayment and Participations of Swingline Loans
. The Borrower agrees to repay each Swingline Loan within one Business Day of demand therefor by the Swingline Lender and, in any event, within five (5) Business Days after the date such Swingline Loan was made; provided, that the proceeds of a Swingline Loan may not be used to pay a Swingline Loan. Notwithstanding the foregoing, the Borrower shall repay the entire outstanding principal amount of, and all accrued but unpaid interest on, the Swingline Loans on the Swingline Maturity Date (or such earlier date as the Swingline Lender and the Borrower may agree in writing). In lieu of demanding repayment of any outstanding Swingline Loan from the Borrower, the Swingline Lender may, on behalf of the Borrower (which hereby irrevocably directs the Swingline Lender to act on its behalf), request a borrowing of Revolving Loans that are Base Rate Loans from the Lenders in an amount equal to the principal balance of such Swingline Loan. The amount limitations contained in the second sentence of Section 2.1.(a) shall not apply to any borrowing of such Revolving Loans made pursuant to this subsection. The Swingline Lender shall give notice to the Administrative Agent of any such borrowing of Revolving Loans not later than 11:00 a.m. Central time at least one Business Day prior to the proposed date of such borrowing. Promptly after receipt of such notice of borrowing of Revolving Loans from the Swingline Lender under the immediately preceding sentence,
the Administrative Agent shall notify each Lender of the proposed borrowing. Not later than 11:00 a.m. Central time on the proposed date of such borrowing, each Lender will make available to the Administrative Agent at the Principal Office for the account of the Swingline Lender, in immediately
available funds, the proceeds of the Revolving Loan to be made by such Lender. The Administrative Agent shall pay the proceeds of such Revolving Loans to the Swingline Lender, which shall apply such proceeds to repay such Swingline Loan. If the Lenders are prohibited from making Revolving Loans required to be made under this subsection for any reason whatsoever, including without limitation, the occurrence of any of the Defaults or Events of Default described in Sections 11.1.(e) or (f)), each Lender shall purchase from the Swingline Lender, without recourse or warranty, an undivided interest and participation to the extent of such Lender's Revolving Commitment Percentage of such Swingline Loan, by directly purchasing a participation in such Swingline Loan in such amount and paying the proceeds thereof to the Administrative Agent for the account of the Swingline Lender in Dollars and in immediately available funds. A Lender's obligation to purchase such a participation in a Swingline Loan shall be absolute and unconditional and shall not be affected by any circumstance whatsoever, including without limitation, (i) any claim of setoff, counterclaim, recoupment, defense or other right which such Lender or any other Person may have or claim against the Administrative Agent, the Swingline Lender or any other Person whatsoever, (ii) the occurrence or continuation of a Default or Event of Default (including without limitation, any of the Defaults or Events of Default described in Sections 11.1. (e) or (f)), or the termination of any Lender's Revolving Commitment, (iii) the existence (or alleged existence) of an event or condition which has had or could have a Material Adverse Effect, (iv) any breach of any Loan Document by the Administrative Agent, any Lender, the Borrower or any other Loan Party, or (v) any other circumstance, happening or event whatsoever, whether or not similar to any of the foregoing. If such amount is not in fact made available to the Swingline Lender by any Lender, the Swingline Lender shall be entitled to recover such amount on demand from such Lender, together with accrued interest thereon for each day from the date of demand thereof, at the Federal Funds Rate. If such Lender does not pay such amount forthwith upon the Swingline Lender's demand therefor, and until such time as such Lender makes the required payment, the Swingline Lender shall be deemed to continue to have outstanding Swingline Loans in the amount of such unpaid participation obligation for all purposes of the Loan Documents (other than those provisions requiring the other Lenders to purchase a participation therein). Further, such Lender shall be deemed to have assigned any and all payments made of principal and interest on its Revolving Loans, and any other amounts due it hereunder, to the Swingline Lender to fund Swingline Loans in the amount of the participation in Swingline Loans that such Lender failed to purchase pursuant to this Section until such amount has been purchased (as a result of such assignment or otherwise).
Section 2.4.
Rates and Payment of Interest on Loans.
(a)
Rates
. The Borrower promises to pay to the Administrative Agent for the account of each Lender interest on the unpaid principal amount of each Loan made by such Lender for the period from and including the date of the making of such Loan to but excluding the date such Loan shall be paid in full, at the following per annum rates:
(i)
during such periods as such Loan is a Base Rate Loan, at the Base Rate (as in effect from time to time), plus the Applicable Margin; and
(ii)
during such periods as such Loan is a LIBOR Loan, at LIBOR for such Loan for the Interest Period therefor, plus the Applicable Margin.
Notwithstanding the foregoing, while an Event of Default exists, the Borrower shall, upon and after the Administrative Agent's demand, pay to the Administrative Agent for the account of each Lender and the Issuing Bank, as the case may be, interest at the Post-Default Rate on the outstanding principal amount of any Loan made by such Lender, on all Reimbursement Obligations and on any other amount payable by
the Borrower hereunder or under the Notes held by such Lender to or for the account of such Lender (including without limitation, accrued but unpaid interest to the extent permitted under Applicable Law).
(b)
Credit Rating Election Event
. In the event the Borrower obtains an Investment Grade Rating during the term of this Agreement, the Borrower may make a one-time irrevocable election upon written notice to the Administrative Agent (and the Administrative Agent shall promptly notify the Lenders thereof) to utilize its Credit Rating in determining the Applicable Margin (a “Credit Rating Election Event”), pursuant to the relevant table set forth in the definition of Applicable Margin.
(c)
Payment of Interest
. All accrued and unpaid interest on the outstanding principal amount of each Loan shall be payable (i) monthly in arrears on the first day of each month, commencing with the first full calendar month occurring after the Effective Date and (ii) on any date on which the principal balance of such Loan is due and payable in full (whether at maturity, due to acceleration or otherwise). Interest payable at the Post-Default Rate shall be payable from time to time on demand. All determinations by the Administrative Agent of an interest rate hereunder shall be conclusive and binding on the Lenders and the Borrower for all purposes, absent manifest error.
(d)
Borrower Information Used to Determine Applicable Interest Rates
. The parties understand that the applicable interest rate for the Obligations and certain fees set forth herein may be determined and/or adjusted from time to time based upon certain financial ratios and/or other information to be provided or certified to the Lenders by the Borrower (the “Borrower Information”). If it is subsequently determined that any such Borrower Information was incorrect (for whatever reason, including without limitation because of a subsequent restatement of earnings by the Borrower) at the time it was delivered to the Administrative Agent, and if the applicable interest rate or fees calculated for any period were lower than they should have been had the correct information been timely provided, then, such
interest rate and such fees for such period shall be automatically recalculated using correct Borrower Information. The Administrative Agent shall promptly notify the Borrower in writing of any additional interest and fees due because of such recalculation, and the Borrower shall pay such additional interest or fees due to the Administrative Agent, for the account of each Lender, within five (5) Business Days of receipt of such written notice. Any recalculation of interest or fees
required by this provision shall survive the termination of this Agreement, and this provision shall not in any way limit any of the Administrative Agent's, the Issuing Bank's, or any Lender's other rights under this Agreement.
Section 2.5.
Number of Interest Periods.
Notwithstanding anything to the contrary contained in this Agreement, there may be no more than eight (8)
different Interest Periods outstanding at the same time.
Section 2.6.
Repayment of Loans.
The Borrower shall repay the entire outstanding principal amount of, and all accrued but unpaid interest on, the Loans on the Maturity Date.
Section 2.7.
Prepayments.
(a)
Optional
. Subject to Section 5.4., the Borrower may prepay any Loan at any time without premium or penalty. The Borrower shall give the Administrative Agent at least three (3) Business Days prior written notice of the prepayment of any Loan. Each voluntary prepayment of Loans shall be in an aggregate minimum amount of $100,000 and integral multiples of $1,000 in excess thereof.
(b)
Mandatory
. If at any time the aggregate principal amount of all outstanding Revolving Loans and Swingline Loans, together with the aggregate amount of all Letter of Credit Liabilities, exceeds the aggregate amount of the Revolving Commitments, the Borrower shall immediately pay to the Administrative Agent for the account of the Lenders then holding Revolving Commitments (or if the Revolving Commitments have been terminated, then holding outstanding Revolving Loans, Swingline Loans and/or Letter of Credit Liabilities), the amount of such excess. All payments under this subsection (b) shall be applied to pay all amounts of principal outstanding on the Loans and any Reimbursement Obligations pro rata in accordance with Section 3.2. and if any Letters of Credit are outstanding at such time, the remainder, if any, shall be deposited into the Letter of Credit Collateral Account for application to any Reimbursement Obligations. If the Borrower is required to pay any outstanding LIBOR Loans by reason of this Section prior to the end of the applicable Interest Period therefor, the Borrower shall pay all amounts due under Section 5.4.
Section 2.8.
Late Charges.
So long as the Post-Default Rate is not payable with respect to the Obligations as provided in Section 2.4., if any payment required under this Agreement is not paid within fifteen (15) days after it becomes due and payable, the Borrower shall pay a late charge for late payment to compensate the Lenders for the loss of use of funds and for the expenses of handling the delinquent payment, in an amount equal to three percent (3%) of such delinquent payment. Such late charge shall be paid in any event not later than the due date of the next subsequent installment of principal and/or interest. In the event the maturity of the Obligations hereunder occurs or is accelerated pursuant to Section 11.2., this Section shall apply only to payments overdue prior to the time of such acceleration. This Section shall not be deemed to be a waiver of the Lenders' right to accelerate payment of any of the Obligations as permitted under the terms of this Agreement.
Section 2.9.
Continuation.
So long as there exists no Default or Event of Default, the Borrower may on any Business Day, with respect to any LIBOR Loan, elect to maintain such LIBOR Loan or any portion thereof as a LIBOR Loan by selecting a new Interest Period for such LIBOR Loan. Each Continuation of a LIBOR Loan shall be in an aggregate minimum amount of $100,000 and integral multiples of $1,000 in excess of that amount, and each new Interest Period selected under this Section shall commence on the last day of the immediately preceding Interest Period. Each selection of a new Interest Period shall be made by the Borrower giving to the Administrative Agent a Notice of Continuation not later than 11:00 a.m. Central time on the third Business Day prior to the date of any such Continuation. Such notice by the Borrower of a Continuation shall be by telecopy, electronic mail or other similar form of communication in the form of a Notice of Continuation, specifying (a) the proposed date of such Continuation, (b) the LIBOR Loans and portions thereof subject to such Continuation and (c) the duration of the selected Interest Period, all of which shall be specified in such manner as is necessary to comply with all limitations on Loans outstanding hereunder. Each Notice of Continuation shall be irrevocable by and binding on the Borrower once given. Promptly after receipt of a Notice of Continuation, the Administrative Agent shall notify each Lender of the proposed Continuation. If the Borrower shall fail to select in a timely manner a new Interest Period for any LIBOR Loan in accordance with this Section, such Loan will automatically, on the last day of the current Interest Period therefor, continue as a LIBOR Loan with an Interest Period of one month; provided, however, that if a Default or Event of Default exists, such Loan will automatically, on the last day of the current Interest Period therefor, Convert into a Base Rate Loan notwithstanding the first sentence of Section 2.10. or the Borrower's failure to comply with any of the terms of such Section.
Section 2.10.
Conversion.
So long as there exists no Default or Event of Default, the Borrower may on any Business Day, upon the Borrower's giving of a Notice of Conversion to the Administrative Agent by telecopy, electronic mail or other similar form of communication, Convert all or a portion of a Loan of one Type into a Loan of another Type. Each Conversion of Base Rate Loans into LIBOR Loans shall be in an aggregate minimum amount of $100,000 and integral multiples of $1,000 in excess of that amount, and upon Conversion of a Base Rate Loan into a LIBOR Loan, the Borrower shall pay accrued interest to the date of Conversion on the principal amount so Converted in accordance with Section 2.4. Any Conversion of a LIBOR Loan into a Base Rate Loan shall be made on, and only on, the last day of an Interest Period for such LIBOR Loan. Each such Notice of Conversion shall be given not later than 11:00 a.m. Central time one Business Day prior to the date of any proposed Conversion into Base Rate Loans and three (3) Business Days prior to the date of any proposed Conversion into LIBOR Loans. Promptly after receipt of a Notice of Conversion, the Administrative Agent shall notify each Lender of the proposed Conversion. Subject to the restrictions specified above, each Notice of Conversion shall be by telecopy, electronic mail or other similar form of communication in the form of a Notice of Conversion specifying (a) the requested date of such Conversion, (b) the Type of Loan to be Converted, (c) the portion of such Type of Loan to be Converted, (d) the Type of Loan such Loan is to be Converted into and (e) if such Conversion is into a LIBOR Loan, the requested duration of the Interest Period of such Loan. Each Notice of Conversion shall be irrevocable by and binding on the Borrower once given.
Section 2.11.
Notes.
(a)
Notes
. The Revolving Loans made by each Lender shall, in addition to this Agreement, also be evidenced by a promissory note of the Borrower substantially in the form of
Exhibit H
(each a “Revolving Note”), payable to the order of such Lender in a principal amount equal to the amount of its Revolving Commitment as originally in effect and otherwise duly completed. The Swingline Loans made by the Swingline Lender to the Borrower shall, in addition to this Agreement, also be evidenced by a Swingline Note payable to the order of the Swingline Lender.
(b)
Records
. The date, amount, interest rate, Type and duration of Interest Periods (if applicable) of each Loan made by each Lender to the Borrower, and each payment made on account of the principal thereof, shall be recorded by such Lender on its books and such entries shall be binding on the Borrower absent manifest error; provided, however, that (i) the failure of a Lender to make any such record shall not affect the obligations of the Borrower under any of the Loan Documents and (ii) if there is a discrepancy between such records of a Lender and the statements of accounts maintained by the Administrative Agent pursuant to Section 3.8., in the absence of manifest error, the statements of account maintained by the Administrative Agent pursuant to Section 3.8. shall be controlling.
(c)
Lost, Stolen, Destroyed or Mutilated Notes
. Upon receipt by the Borrower of (i) written notice from a Lender that a Note of such Lender has been lost, stolen, destroyed, mutilated, inappropriately cancelled or inappropriately marked, and (ii)(A) in the case of loss, theft or destruction, an unsecured agreement of indemnity from such Lender in form reasonably satisfactory to the Borrower, or (B) in the case of mutilation, inappropriate cancellation or inappropriate marking, upon surrender and cancellation of such Note, the Borrower shall at no expense to Borrower execute and deliver to such Lender a new Note, identical in form and substance and dated the date of such lost, stolen, destroyed, mutilated, inappropriately cancelled or inappropriately marked Note.
Section 2.12.
Voluntary Reductions of the Revolving Commitment.
The Borrower may terminate or reduce the unused amount of the Revolving Commitments (for which purpose use of the Revolving Commitments shall be deemed to include the aggregate amount of all Letter of Credit Liabilities and the aggregate principal amount of all outstanding Swingline Loans) at any time and from time to time without penalty or premium upon not less than five (5) Business Days prior written notice to the Administrative Agent of each such termination or reduction, which notice shall specify the effective date thereof and the amount of any such reduction (which in the case of any partial reduction of the Revolving Commitments shall not be less than $5,000,000 and integral multiples of $1,000,000 in excess of that amount in the aggregate) and shall be irrevocable once given and effective only upon receipt by the Administrative Agent (“Commitment Reduction Notice”). Any such reduction shall reduce the Revolving Commitments of all Lenders on a pro rata basis. Promptly after receipt of a Commitment Reduction Notice the Administrative Agent shall notify each Lender of the proposed termination or Revolving Commitment reduction. The Revolving Commitments, once reduced or terminated pursuant to this Section, may not be increased or reinstated. The Borrower shall pay all interest and fees, on the Loans accrued to the date of such reduction or termination of the Revolving Commitments to the Administrative Agent for the account of the Lenders, including but not limited to any applicable compensation due to each Lender in accordance with Section 5.4. of this Agreement.
Section 2.13.
Extension of Maturity Date.
Subject to the terms of this Section 2.13., the Borrower shall have the right to extend the current Maturity Date by one (1) year by executing and delivering to the Administrative Agent at least ninety (90) days but not more than one hundred eighty (180) days prior to the current Maturity Date, a written notice of such extension (an “Extension Notice”). The Administrative Agent shall forward to each Lender a copy of such Extension Notice delivered to the Administrative Agent promptly upon receipt thereof. Subject to satisfaction of the following conditions, the Maturity Date shall be extended for one (1) year: (x) immediately prior to such extension and immediately after giving effect thereto, (A) no Default or Event of Default shall or would exist and (B) the representations and warranties made or deemed made by the Borrower and each other Loan Party in the Loan Documents to which any of them is a party, shall be true and correct in all material respects on and as of the date of such extension with the same force and effect as if made on and as of such date except to the extent that such representations and warranties expressly relate solely to an earlier date (in which case such representations and warranties shall have been true and correct in all material respects on and as of such earlier date) and except for changes in factual circumstances specifically and expressly permitted under the Loan Documents and (y) the Borrower shall have paid the Fees payable under Section 3.5.(d). At any time prior to the effectiveness of any such extension, upon the Administrative Agent's request, the Borrower shall deliver to the Administrative Agent a certificate from a Senior Officer certifying the matters referred to in the immediately preceding clauses (x)(A) and (x)(B). The Maturity Date may be extended only one time pursuant to this Section 2.13.
Section 2.14.
Expiration or Maturity Date of Letters of Credit Past Maturity Date.
If on the date that is thirty (30) days prior to the Maturity Date or any such other date upon which the Revolving Commitments are terminated or reduced to zero (whether voluntarily, by reason of the occurrence of an Event of Default or otherwise), there are any Letters of Credit outstanding hereunder, the Borrower shall, on such date, pay to the Administrative Agent, for its benefit and the benefit of the Lenders and the Issuing Bank, an amount of money equal to the Stated Amount of such Letter(s) of Credit for deposit into the Letter of Credit Collateral Account; provided, that the expiration date of such Letter of Credit shall be no later than the one year anniversary of the Maturity Date. If a drawing pursuant to any such Letter of Credit occurs on or prior to the expiration date of such Letter of Credit, the Borrower
authorizes the Administrative Agent to use the monies deposited in the Letter of Credit Collateral Account to reimburse the Issuing Bank for the payment made by the Issuing Bank to the beneficiary with respect to such drawing or the payee with respect to such presentment. If no drawing occurs on or prior to the expiration date of such Letter of Credit, the Administrative Agent shall pay to the Borrower (or to whomever else may be legally entitled thereto) the monies deposited in the Letter of Credit Collateral Account with respect to such outstanding Letter of Credit, together with all interest accrued thereon, on or before the date thirty (30) days after the expiration date of such Letter of Credit.
Section 2.15.
Amount Limitations.
Notwithstanding any other term of this Agreement or any other Loan Document, no Lender shall be required to make any Loan, the Issuing Bank shall not be required to issue any Letter of Credit and no reduction of the Revolving Commitments pursuant to Section 2.12. shall take effect, if immediately after the making of such Loan, the issuance of such Letter of Credit or such reduction in the Revolving Commitments the aggregate principal amount of all outstanding Revolving Loans and Swingline Loans, together with the aggregate amount of all Letter of Credit Liabilities, would exceed the aggregate amount of the Revolving Commitments at such time.
Section 2.16.
Funds Transfer Disbursements.
(a)
Generally
. The Borrower hereby authorizes the Administrative Agent to disburse the proceeds of any Loan made by the Lenders or any of their Affiliates pursuant to the Loan Documents as requested by an authorized representative of the Borrower to any of the accounts designated in the Transfer Authorizer Designation Form. The Borrower agrees to be bound by any transfer request: (i) authorized or transmitted by the Borrower; or, (ii) made in the Borrower's name and accepted by the Administrative Agent in good faith and in compliance with these transfer instructions, even if not properly authorized by the Borrower. The Borrower further agrees and acknowledges that the Administrative Agent may rely solely on any bank routing number or identifying bank account number or name provided by the Borrower to effect a wire or funds transfer even if the information provided by the Borrower identifies a different bank or account holder than named by the Borrower. The Administrative Agent will inform Borrower of any errors actually known by Administrative Agent in any information provided by Borrower, but is not obligated or required in any way to take any actions to detect errors in information provided by the Borrower. If the Administrative Agent takes any actions in an attempt to detect errors in the transmission or content of transfer or requests or takes any actions in an attempt to detect unauthorized funds transfer requests, the Borrower agrees that no matter how many times the Administrative Agent takes these actions the Administrative Agent will not in any situation be liable for failing to take or correctly perform these actions in the future and such actions shall not become any part of the transfer disbursement procedures authorized under this provision, the Loan Documents, or any agreement between the Administrative Agent and the Borrower or between any Lender and the Borrower. The Borrower agrees to notify the Administrative Agent of any errors in the transfer of any funds or of any unauthorized or improperly authorized transfer requests within fourteen (14) days after the Administrative Agent's confirmation to the Borrower of such transfer.
(b)
Funds Transfer
. The Administrative Agent will, in its sole discretion, determine the funds transfer system and the means by which each transfer will be made. The Administrative Agent may delay or refuse to accept a funds transfer request if the transfer would: (i) violate the terms of this authorization, (ii) require use of a bank unacceptable to the Administrative Agent or any Lender or prohibited by any Governmental Authority, (iii) cause the Administrative Agent or any Lender to violate
any Federal Reserve or other regulatory risk control program or guideline, or (iv) otherwise cause the Administrative Agent or any Lender to violate any Applicable Law or regulation.
(c)
Limitation of Liability
. Neither the Administrative Agent, the Issuing Bank nor any Lender shall be liable to the Borrower or any other parties for (i) errors, acts or failures to act of others, including other entities, banks, communications carriers or clearinghouses, through which the Borrower's transfers may be made or information received or transmitted, and no such entity shall be deemed an agent of the Administrative Agent, the Issuing Bank or any Lender, (ii) any loss, liability or delay caused by fires, earthquakes, wars, civil disturbances, power surges or failures, acts of government, labor disputes, failures in communications networks, legal constraints or other events beyond Administrative Agent's, Issuing Bank's or any Lender's control, or (iii) any special, consequential, indirect or punitive damages, whether or not (x) any claim for these damages is based on tort or contract or (y) the Administrative Agent, the Issuing Bank, any Lender or the Borrower knew or should have known the likelihood of these damages in any situation. Neither the Administrative Agent, the Issuing Bank nor any Lender makes any representations or warranties other than those expressly made in this Agreement.
Section 2.17.
Increase in Revolving Commitments.
The Borrower shall have the right to request increases in the aggregate amount of the Revolving Commitments by providing written notice to the Administrative Agent, which notice shall be irrevocable once given;
provided
,
however
, that the aggregate amount of such increases under this Agreement and that certain Third Amended and Restated Credit Agreement, dated as of the date hereof, by and among the Borrower, the Lenders party hereto and the Administrative Agent (as amended from time to time), shall not exceed $400,000,000. Each such increase in the Revolving Commitments must be an aggregate minimum amount of $25,000,000 and integral multiples of $5,000,000 in excess thereof (or such other amounts as may be acceptable to the Administrative Agent and the Borrower). The Administrative Agent, in consultation with the Borrower, shall manage all aspects of the syndication of such increase in the Revolving Commitments, including decisions as to the selection of the existing Lenders and/or other banks, financial institutions and other institutional lenders to be approached with respect to such increase and the allocations of the increase in the Revolving Commitments among such existing Lenders and/or other banks, financial institutions and other institutional lenders. No Lender shall be obligated in any way whatsoever to increase its Revolving Commitment or provide a new Revolving Commitment, and any new Lender becoming a party to this Agreement in connection with any such requested increase must be an Eligible Assignee. If a new Lender becomes a party to this Agreement, or if any existing Lender is increasing its Revolving Commitment, such Lender shall on the date it becomes a Lender hereunder (or in the case of an existing Lender, increases its Revolving Commitment) (and as a condition thereto) purchase from the other Lenders its Revolving Commitment Percentage (determined with respect to the Lenders' respective Revolving Commitments and after giving effect to the increase of Revolving Commitments) of any outstanding Revolving Loans, by making available to the Administrative Agent for the account of such other Lenders, in same day funds, an amount equal to the sum of (A) the portion of the outstanding principal amount of such Revolving Loans to be purchased by such Lender,
plus
(B) the aggregate amount of payments previously made by the other Lenders under Section 2.2.(j) that have not been repaid,
plus
(C) interest accrued and unpaid to and as of such date on such portion of the outstanding principal amount of such Revolving Loans. The Borrower shall pay to the Lenders amounts payable, if any, to such Lenders under Section 5.4. as a result of the prepayment of any such Revolving Loans. Effecting the increase of the Revolving Commitments under this Section is subject to the following conditions precedent: (x) no Default or Event of Default shall be in existence on the effective date of such increase, (y) the representations and warranties made or deemed made by the Borrower or any other Loan Party in any Loan Document to which such Loan Party is a party shall be true and correct on the
effective date of such increase except to the extent that such representations and warranties expressly relate solely to an earlier date (in which case such representations and warranties shall have been true and correct on and as of such earlier date) and except for changes in factual circumstances specifically and expressly permitted hereunder, and (z) the Administrative Agent shall have received each of the following, in form and substance satisfactory to the Administrative Agent: (i) if not previously delivered to the Administrative Agent, copies certified by the Secretary or Assistant Secretary of (A) all partnership or other necessary action taken by the Borrower to authorize such increase and (B) all corporate, partnership, member or other necessary action taken by each Guarantor authorizing the guaranty of such increase; and (ii) an opinion of counsel to the Borrower and the Guarantors, and addressed to the Administrative Agent and the Lenders covering such matters as reasonably requested by the Administrative Agent; and (iii) new Revolving Notes executed by the Borrower, payable to any new Lenders and replacement Revolving Notes executed by the Borrower, payable to any existing Lenders increasing their Revolving Commitments, in the amount of such Lender's Revolving Commitment at the time of the effectiveness of the applicable increase in the aggregate amount of the Revolving Commitments. In connection with any increase in the aggregate amount of the Revolving Commitments pursuant to this Section 2.17. any Lender becoming a party hereto shall execute such documents and agreements as the Administrative Agent may reasonably request.
Article III. Payments, Fees and Other General Provisions
Section 3.1.
Payments.
(a)
Payments by Borrower
. Except to the extent otherwise provided herein, all payments of principal, interest, Fees and other amounts to be made by the Borrower under this Agreement, the Notes or any other Loan Document shall be made in Dollars, in immediately available funds, without setoff, deduction or counterclaim, to the Administrative Agent at the Principal Office, not later than 1:00 p.m. Central time on the date on which such payment shall become due (each such payment made after such time on such due date to be deemed to have been made on the next succeeding Business Day). Subject to Section 11.5., the Borrower shall, at the time of making each payment under this Agreement or any other Loan Document, specify to the Administrative Agent the amounts payable by the Borrower hereunder to which such payment is to be applied. Each payment received by the Administrative Agent for the account of a Lender under this Agreement or any Note shall be paid to such Lender by wire transfer of immediately available funds in accordance with the wiring instructions provided by such Lender to the Administrative Agent from time to time, for the account of such Lender at the applicable Lending Office of such Lender. Each payment received by the Administrative Agent for the account of a Lender under this Agreement or any Note shall be paid to such Lender by wire transfer of immediately available funds in accordance with the wiring instructions provided by such Lender to the Administrative Agent from time to time, for the account of such Lender at the applicable Lending Office of such Lender. Each payment received by the Administrative Agent for the account of the Issuing Bank under this Agreement shall be paid to the Issuing Bank by wire transfer of immediately available funds in accordance with the wiring instructions provided by the Issuing Bank to the Administrative Agent from time to time, for the account of the Issuing Bank. In the event the Administrative Agent fails to pay such amounts to such Lender or the Issuing Bank, as the case may be, within one Business Day of receipt of such amounts, the Administrative Agent shall pay interest on such amount at a rate per annum equal to the Federal Funds Rate from time to time in effect. If the due date of any payment under this Agreement or any other Loan Document would otherwise fall on a day which is not a Business Day such date shall be extended to the next succeeding Business Day and interest shall continue to accrue at the rate, if any, applicable to such payment for the period of such extension.
(b)
Presumptions Regarding Payments by Borrower
. Unless the Administrative Agent shall have received notice from the Borrower prior to the date on which any payment is due to the Administrative Agent for the account of the Lenders or the Issuing Bank hereunder that the Borrower will not make such payment, the Administrative Agent may assume that the Borrower has made such payment on such date in accordance herewith and may (but shall not be obligated to), in reliance upon such assumption, distribute to the Lenders or the Issuing Bank, as the case may be, the amount due. In such event, if the Borrower has not in fact made such payment, then each of the Lenders or the Issuing Bank, as the case may be, severally agrees to repay to the Administrative Agent on demand that amount so distributed to such Lender or the Issuing Bank, with interest thereon, for each day from and including the date such amount is distributed to it to but excluding the date of payment to the Administrative Agent, at the greater of the Federal Funds Rate and a rate determined by the Administrative Agent in accordance with banking industry rules on interbank compensation.
Section 3.2.
Pro Rata Treatment.
Except to the extent otherwise provided herein: (a) each borrowing from Lenders under Section 2.1.(a), 2.2.(e) and 2.3.(e) shall be made from the Lenders, each payment of the fees under Sections 3.5.(a), 3.5.(b) and 3.5.(d) shall be made for the account of the Lenders, and each termination or reduction of the amount of the Revolving Commitments under Section 2.12. shall be applied to the respective Revolving Commitments of the Lenders, pro rata according to the amounts of their respective Revolving Commitments; (b) each payment or prepayment of principal of Revolving Loans by the Borrower shall be made for the account of the Lenders pro rata in accordance with the respective unpaid principal amounts of the Revolving Loans held by them, provided that if immediately prior to giving effect to any such payment in respect of any Revolving Loans the outstanding principal amount of the Revolving Loans shall not be held by the Lenders pro rata in accordance with their respective Revolving Commitments in effect at the time such Loans were made, then such payment shall be applied to the Revolving Loans in such manner as shall result, as nearly as is practicable, in the outstanding principal amount of the Revolving Loans being held by the Lenders pro rata in accordance with their respective Revolving Commitments; (c) each payment of interest on Revolving Loans by the Borrower shall be made for the account of the Lenders pro rata in accordance with the amounts of interest on such Revolving Loans then due and payable to the respective Lenders; (d) the making, Conversion and Continuation of Loans of a particular Type (other than Conversions provided for by Section 5.1.) shall be made pro rata among the Lenders according to the amounts of their respective Loans and the then current Interest Period for each Lender's portion of each Loan of such Type shall be coterminous; (e) the Lenders' participation in, and payment obligations in respect of, Swingline Loans under Section 2.3., shall be in accordance with their respective Revolving Commitment Percentages; and (f) the Lenders' participation in, and payment obligations in respect of, Letters of Credit under Section 2.2., shall be in accordance with their respective Revolving Commitment Percentages. Any payment or prepayment of principal or interest made (i) during the existence of a Default or Event of Default shall be made for the account of the Lenders in accordance with the order set forth in Section 11.5. and (ii) pursuant to Section 2.7.(b) shall be made for the account of the Lenders holding Revolving Commitments (or, if the Revolving Commitments have been terminated, holding Revolving Loans and Letter of Credit Liabilities) in accordance with the order set forth in Section 11.5. All payments of principal, interest, fees and other amounts in respect of the Swingline Loans shall be for the account of the Swingline Lender only (except to the extent any Lender shall have acquired a participating interest in any such Swingline Loan pursuant to Section 2.3.(e), in which case such payments shall be pro rata in accordance with such participating interests).
Section 3.3.
Sharing of Payments, Etc.
If a Lender shall obtain payment of any principal of, or interest on, any Loan under this Agreement or shall obtain payment on any other Obligation owing by the Borrower or any other Loan Party through the exercise of any right of setoff, banker's lien, counterclaim or similar right or otherwise or through voluntary prepayments directly to a Lender or other payments made by or on behalf of the Borrower or any other Loan Party to a Lender (other than any payment in respect of Specified Derivatives Obligations) not in accordance with the terms of this Agreement and such payment should be distributed to the Lenders in accordance with Section 3.2. or Section 11.5., such Lender shall promptly purchase from such other Lenders participations in (or, if and to the extent specified by such Lender, direct interests in) the Loans made by the other Lenders or other Obligations owed to such other Lenders in such amounts, and make such other adjustments from time to time as shall be equitable, to the end that all the Lenders shall share the benefit of such payment (net of any reasonable expenses which may actually be incurred by such Lender in obtaining or preserving such benefit) in accordance with the requirements of Section 3.2. or Section 11.5., as applicable. To such end, all the Lenders shall make appropriate adjustments among themselves (by the resale of participations sold or otherwise) if such payment is rescinded or must otherwise be restored. The Borrower agrees that any Lender so purchasing a participation (or direct interest) in the Loans or other Obligations owed to such other Lenders may exercise all rights of setoff, banker's lien, counterclaim or similar rights with the respect to such participation as fully as if such Lender were a direct holder of Loans in the amount of such participation. Nothing contained herein shall require any Lender to exercise any such right or shall affect the right of any Lender to exercise and retain the benefits of exercising, any such right with respect to any other indebtedness or obligation of the Borrower.
Section 3.4.
Several Obligations.
No Lender shall be responsible for the failure of any other Lender to make a Loan or to perform any other obligation to be made or performed by such other Lender hereunder, and the failure of any Lender to make a Loan or to perform any other obligation to be made or performed by it hereunder shall not relieve the obligation of any other Lender to make any Loan or to perform any other obligation to be made or performed by such other Lender.
Section 3.5.
Fees.
(a)
Closing Fee
. On the Effective Date, the Borrower agrees to pay to the Administrative Agent and each Lender all loan fees as have been agreed to in writing by the Borrower and the Administrative Agent or each Lender, as applicable.
(b)
Facility Fees and Unused Fees
.
(i)
Unused Fee
. During the period from the Effective Date to but excluding the Maturity Date (or, if earlier, the occurrence of a Credit Rating Election Event), the Borrower agrees to pay to the Administrative Agent for the account of the Lenders an unused facility fee equal to the sum of the average daily amount by which the aggregate amount of the Revolving Commitments (as they may be reduced from time to time pursuant to Section 2.12. or increased pursuant to Section 2.17.) exceeds the aggregate outstanding principal balance of Revolving Loans and Letter of Credit Liabilities set forth in the table below multiplied by the corresponding per annum rate:
|
|
|
Amount by Which Revolving Commitments Exceed Revolving Loans and Letter of Credit Liabilities
|
Unused Fee
(percent per annum)
|
$0 to and including an amount equal to 50% of the aggregate amount of Revolving Commitments
|
0.25%
|
Greater than an amount equal to 50% of the aggregate amount of Revolving Commitments
|
0.30%
|
Such fee shall be computed on a daily basis for each calendar quarter during the term of this Agreement and shall be payable quarterly in arrears on the fifth day of each January, April, July and October during the term of this Agreement and on the Maturity Date or any earlier date of termination of the Revolving Commitments or reduction of the Revolving Commitments to zero. For the avoidance of doubt, for purposes of calculating an unused facility fee, the outstanding principal balance of Swingline Loans shall not be factored into the computation.
(ii)
Facility Fee
. Upon the occurrence of the Credit Rating Election Event until the Maturity Date, and so long as the Applicable Margin shall be determined by reference to the Credit Rating of the Borrower, the Borrower agrees to pay to the Administrative Agent for the account of the Lenders a facility fee equal to the average daily aggregate amount of the Revolving Commitments (whether or not utilized) times a rate per annum equal to the Applicable Facility Fee. Such fee shall be payable quarterly in arrears on the fifth day of each January, April, July and October during the term of this Agreement and on the Maturity Date or any earlier date of termination of the Revolving Commitments or reduction of the Revolving Commitments to zero. The Borrower acknowledges that the fee payable hereunder is a bona fide commitment fee and is intended as reasonable compensation to the Lenders for committing to make funds available to the Borrower as described herein and for no other purposes.
(c)
Letter of Credit Fees
. The Borrower agrees to pay to the Administrative Agent for the account of each Lender a letter of credit fee at a rate per annum equal to the Applicable Margin times the daily average Stated Amount of each Letter of Credit for the period from and including the date of issuance of such Letter of Credit (x) to and including the date such Letter of Credit expires or is cancelled or (y) to but excluding the date such Letter of Credit is drawn in full;
provided
,
however
, in no event shall the aggregate amount of such fee in respect of any Letter of Credit be less than $1,000. In addition to such fees, the Borrower shall pay to the Issuing Bank solely for its own account, a fronting fee in respect of each Letter of Credit at the rate equal to 0.15 percent (0.15%) per annum on the daily average Stated Amount of such Letter of Credit;
provided
,
however
, in no event shall the amount of such fronting fee in respect of any Letter of Credit be less than $1,500. The fees provided for in the immediately preceding two sentences shall be non-refundable and payable in arrears (i) quarterly on the first day of January, April, July and October, (ii) on the Maturity Date, (iii) on the date the Revolving Commitments are terminated or reduced to zero and (iv) thereafter from time to time on demand of the Administrative Agent. The Borrower shall pay directly to the Issuing Bank from time to time on demand all commissions, charges, costs and expenses in the amounts customarily charged by the Issuing Bank from time to time in like circumstances with respect to the issuance of each Letter of Credit, drawings, amendments and other transactions relating thereto.
(d)
Extension Fee
. If the Borrower exercises its right to extend the Maturity Date in accordance with Section 2.13., the Borrower agrees to pay to the Administrative Agent for the account of each Lender an extension fee equal to one-fifth of one percent (0.20%) of the amount of such Lender's Revolving Commitment (whether or not utilized) as of the day immediately prior to the then current Maturity Date (before giving effect to such extension). Such fee shall be paid to the Administrative Agent prior to, and as a condition to, such extension.
(e)
Administrative and Other Fees
. The Borrower agrees to pay the administrative and other fees of the Administrative Agent as provided in the Fee Letter and as may be otherwise agreed to in writing from time to time by the Borrower and the Administrative Agent.
Section 3.6.
Computations.
Unless otherwise expressly set forth herein, any accrued interest on any Loan, any Fees or other Obligations due hereunder shall be computed on the basis of a year of 360 days and the actual number of days elapsed.
Section 3.7.
Usury.
In no event shall the amount of interest due or payable on the Loans or other Obligations exceed the maximum rate of interest allowed by Applicable Law and, if any such payment is paid by the Borrower or any other Loan Party or received by any Lender, then such excess sum shall be credited as a payment of principal, unless the Borrower shall notify the respective Lender in writing that the Borrower elects to have such excess sum returned to it forthwith. It is the express intent of the parties hereto that the Borrower not pay and the Lenders not receive, directly or indirectly, in any manner whatsoever, interest in excess of that which may be lawfully paid by the Borrower under Applicable Law. The parties hereto hereby agree and stipulate that the only charge imposed upon the Borrower for the use of money in connection with this Agreement is and shall be the interest specifically described in Section 2.4.(a)(i) and (ii) and, with respect to Swingline Loans, in Section 2.3.(c). Notwithstanding the foregoing, the parties hereto further agree and stipulate that all agency fees, syndication fees, facility fees, letter of credit fees, underwriting fees, default charges, late charges, funding or “breakage” charges, increased cost charges, attorneys' fees and reimbursement for costs and expenses paid by the Administrative Agent or any Lender to third parties or for damages incurred by the Administrative Agent or any Lender, are charges made to compensate the Administrative Agent or any such Lender for underwriting or administrative services and costs or losses performed or incurred, and to be performed or incurred, by the Administrative Agent and the Lenders in connection with this Agreement and shall under no circumstances be deemed to be charges for the use of money. All charges other than charges for the use of money shall be fully earned and non-refundable when due.
Section 3.8.
Statements of Account.
The Administrative Agent will account to the Borrower monthly with a statement of Loans, accrued interest and Fees, charges and payments made pursuant to this Agreement and the other Loan Documents, and such account rendered by the Administrative Agent shall be deemed conclusive upon the Borrower absent manifest error. The failure of the Administrative Agent to deliver such a statement of accounts shall not relieve or discharge the Borrower from any of its obligations hereunder.
Section 3.9.
Defaulting Lenders.
Notwithstanding anything to the contrary contained in this Agreement, if any Lender becomes a Defaulting Lender, then, until such time as such Lender is no longer a Defaulting Lender, to the extent permitted by Applicable Law:
(a)
Waivers and Amendments
. Such Defaulting Lender's right to approve or disapprove any amendment, waiver or consent with respect to this Agreement shall be restricted as set forth in the definition of Requisite Lenders.
(b)
Defaulting Lender Waterfall
. Any payment of principal, interest, Fees or other amounts received by the Administrative Agent for the account of such Defaulting Lender (whether voluntary or mandatory, at maturity, pursuant to Article XI. or otherwise) or received by the Administrative Agent from a Defaulting Lender pursuant to Section 3.3. shall be applied at such time or times as may be determined by the Administrative Agent as follows:
first
, to the payment of any amounts owing by such Defaulting Lender to the Administrative Agent hereunder;
second
, to the payment on a pro rata basis of any amounts owing by such Defaulting Lender to the Issuing Bank or the Swingline Lender hereunder;
third
, to Cash Collateralize the Issuing Bank's Fronting Exposure with respect to such Defaulting Lender in accordance with subsection (e) below;
fourth
, as the Borrower may request (so long as no Default or Event of Default exists), to the funding of any Loan in respect of which such Defaulting Lender has failed to fund its portion thereof as required by this Agreement, as determined by the Administrative Agent;
fifth
, if so determined by the Administrative Agent and the Borrower, to be held in a deposit account and released pro rata in order to (x) satisfy such Defaulting Lender's potential future funding obligations with respect to Loans under this Agreement and (y) Cash Collateralize the Issuing Bank's future Fronting Exposure with respect to such Defaulting Lender with respect to future Letters of Credit issued under this Agreement, in accordance with subsection (e) below;
sixth
, to the payment of any amounts owing to the Lenders, the Issuing Bank or the Swingline Lender as a result of any judgment of a court of competent jurisdiction obtained by any Lender, the Issuing Bank or the Swingline Lender against such Defaulting Lender as a result of such Defaulting Lender's breach of its obligations under this Agreement;
seventh
, so long as no Default or Event of Default exists, to the payment of any amounts owing to the Borrower as a result of any judgment of a court of competent jurisdiction obtained by the Borrower against such Defaulting Lender as a result of such Defaulting Lender's breach of its obligations under this Agreement; and
eighth
, to such Defaulting Lender or as otherwise directed by a court of competent jurisdiction;
provided
that if (x) such payment is a payment of the principal amount of any Loans or amounts owing by such Defaulting Lender under Section 2.2.(j) in respect of Letters of Credit (such amounts “L/C Disbursements”), in respect of which such Defaulting Lender has not fully funded its appropriate share, and (y) such Loans were made or the related Letters of Credit were issued at a time when the conditions set forth in Article VI. were satisfied or waived, such payment shall be applied solely to pay the Loans of, and L/C Disbursements owed to, all Non-Defaulting Lenders on a pro rata basis prior to being applied to the payment of any Loans of, or L/C Disbursements owed to, such Defaulting Lender until such time as all Loans and funded and unfunded participations in Letter of Credit Liabilities and Swingline Loans are held by the Lenders pro rata in accordance with their respective Revolving Commitment Percentages (determined without giving effect to the immediately following subsection (d)). Any payments, prepayments or other amounts paid or payable to a Defaulting Lender that are applied (or held) to pay amounts owed by a Defaulting Lender or to post Cash Collateral pursuant to this subsection shall be deemed paid to and redirected by such Defaulting Lender, and each Lender irrevocably consents hereto.
(c)
Certain Fees
.
(i)
To the extent the Applicable Margin is determined by reference to the ratio of Total Indebtedness to Total Asset Value, no Defaulting Lender shall be entitled to receive any Fee payable under Section 3.5.(b)(i) for any period during which that Lender is a Defaulting Lender (and the Borrower shall not be required to pay any such fee that otherwise would have been required to have been paid to that Defaulting Lender). To the extent the Applicable Margin is determined by reference to the Credit Rating of the Borrower, each Defaulting Lender shall be entitled to receive the Fee payable under Section 3.5.(b)(ii) for any period during which that Lender is a Defaulting Lender only to the extent allocable to the sum of (1) the outstanding principal amount of the Revolving Loans funded by it, and (2) its Revolving Commitment Percentage of the Stated Amount of Letters of Credit for which it has provided Cash Collateral pursuant to the immediately following subsection (e).
(ii)
Each Defaulting Lender shall be entitled to receive letter of credit fees payable under Section 3.5.(c) for any period during which that Lender is a Defaulting Lender only to the extent allocable to its Revolving Commitment Percentage of the stated amount of Letters of Credit for which it has provided Cash Collateral pursuant to the immediately following subsection (e).
(iii)
With respect to any Fee not required to be paid to any Defaulting Lender pursuant to the immediately preceding clauses (i) or (ii), the Borrower shall (x) pay to each Non‑Defaulting Lender that portion of any such Fee otherwise payable to such Defaulting Lender with respect to such Defaulting Lender's participation in Letter of Credit Liabilities or Swingline Loans that has been reallocated to such Non‑Defaulting Lender pursuant to the immediately following subsection (d), (y) pay to each Issuing Bank and Swingline Lender, as applicable, the amount of any such Fee otherwise payable to such Defaulting Lender to the extent allocable to such Issuing Bank's or Swingline Lender's Fronting Exposure to such Defaulting Lender, and (z) not be required to pay the remaining amount of any such Fee.
(d)
Reallocation of Participations to Reduce Fronting Exposure
. All or any part of such Defaulting Lender's participation in Letter of Credit Liabilities and Swingline Loans shall be reallocated among the Non-Defaulting Lenders in accordance with their respective Revolving Commitment Percentages (determined without regard to such Defaulting Lender's Revolving Commitment) but only to the extent that (x) the conditions set forth in Article VI. are satisfied at the time of such reallocation (and, unless the Borrower shall have otherwise notified the Administrative Agent at such time, the Borrower shall be deemed to have represented and warranted that such conditions are satisfied at such time), and (y) such reallocation does not cause the aggregate Revolving Credit Exposure of any Non-Defaulting Lender to exceed such Non-Defaulting Lender's Revolving Commitment. No reallocation hereunder shall constitute a waiver or release of any claim of any party hereunder against a Defaulting Lender arising from that Lender having become a Defaulting Lender, including any claim of a Non-Defaulting Lender as a result of such Non-Defaulting Lender's increased exposure following such reallocation.
(e)
Cash Collateral, Repayment of Swingline Loans
.
(i)
If the reallocation described in the immediately preceding subsection (d) above cannot, or can only partially, be effected, the Borrower shall, without prejudice to any right or remedy available to it hereunder or under law, (x) first, prepay Swingline Loans in an amount equal to the Swingline Lender's Fronting Exposure and (y) second, Cash Collateralize the Issuing Bank's Fronting Exposure in accordance with the procedures set forth in this subsection.
(ii)
At any time that there shall exist a Defaulting Lender, within one (1) Business Day following the written request of the Administrative Agent or the Issuing Bank (with a copy to the Administrative Agent), the Borrower shall Cash Collateralize the Issuing Bank's Fronting Exposure with respect to such Defaulting Lender (determined after giving effect to the immediately preceding subsection (d) and any Cash Collateral provided by such Defaulting Lender) in an amount not less than the aggregate Fronting Exposure of the Issuing Bank with respect to Letters of Credit issued and outstanding at such time.
(iii)
The Borrower, and to the extent provided by any Defaulting Lender, such Defaulting Lender, hereby grant to the Administrative Agent, for the benefit of the Issuing Bank, and agree to maintain, a first priority security interest in all such Cash Collateral as security for the Defaulting Lenders' obligation to fund participations in respect of Letter of Credit Liabilities, to be applied pursuant to the immediately following clause (iv). If at any time the Administrative Agent determines that Cash Collateral is subject to any right or claim of any Person other than the Administrative Agent and the Issuing Bank as herein provided, or that the total amount of such Cash Collateral is less than the aggregate Fronting Exposure of the Issuing Bank with respect to Letters of Credit issued and outstanding at such time, the Borrower will, promptly upon demand by the Administrative Agent, pay or provide to the Administrative Agent additional Cash Collateral in an amount sufficient to eliminate such deficiency (after giving effect to any Cash Collateral provided by the Defaulting Lender).
(iv)
Notwithstanding anything to the contrary contained in this Agreement, Cash Collateral provided under this Section in respect of Letters of Credit shall be applied to the satisfaction of the Defaulting Lender's obligation to fund participations in respect of Letter of Credit Liabilities (including, as to Cash Collateral provided by a Defaulting Lender, any interest accrued on such obligation) for which the Cash Collateral was so provided, prior to any other application of such property as may otherwise be provided for herein.
(v)
Cash Collateral (or the appropriate portion thereof) provided to reduce the Issuing Bank's Fronting Exposure shall no longer be required to be held as Cash Collateral pursuant to this subsection following (x) the elimination of the applicable Fronting Exposure (including by the termination of Defaulting Lender status of the applicable Lender), or (y) the determination by the Administrative Agent and the Issuing Bank that there exists excess Cash Collateral;
provided
that, subject to the immediately preceding subsection (b), the Person providing Cash Collateral and the Issuing Bank may agree that Cash Collateral shall be held to support future anticipated Fronting Exposure or other obligations and
provided
further
that to the extent that such Cash Collateral was provided by the Borrower, such Cash Collateral shall remain subject to the security interest granted pursuant to the Loan Documents.
(f)
Defaulting Lender Cure
. If the Borrower, the Administrative Agent, the Swingline Lender and the Issuing Bank agree in writing that a Lender is no longer a Defaulting Lender, the Administrative Agent will so notify the parties hereto, whereupon as of the effective date specified in such notice and subject to any conditions set forth therein (which may include arrangements with respect to any Cash Collateral), that Lender will, to the extent applicable, purchase at par that portion of outstanding Loans of the other Lenders or take such other actions as the Administrative Agent may determine to be necessary to cause the Loans and funded and unfunded participations in Letters of Credit and Swingline Loans to be held pro rata by the Lenders in accordance with their respective Revolving Commitment Percentages (determined without giving effect to the immediately preceding subsection (d)), whereupon such Lender will cease to be a Defaulting Lender;
provided
that no adjustments will be made
retroactively with respect to Fees accrued or payments made by or on behalf of the Borrower while that Lender was a Defaulting Lender; and
provided
,
further
, that except to the extent otherwise expressly agreed by the affected parties, no change hereunder from Defaulting Lender to Lender will constitute a waiver or release of any claim of any party hereunder arising from that Lender's having been a Defaulting Lender.
(g)
New Swingline Loans/Letters of Credit
. So long as any Lender is a Defaulting Lender, (i) the Swingline Lender shall not be required to fund any Swingline Loans unless it is satisfied that it will have no Fronting Exposure after giving effect to such Swingline Loan and (ii) the Issuing Bank shall not be required to issue, extend, renew or increase any Letter of Credit unless it is satisfied that it will have no Fronting Exposure after giving effect thereto.
Section 3.10.
Taxes; Foreign Lenders.
(a)
Taxes Generally
. All payments by the Borrower of principal of, and interest on, the Loans and all other Obligations shall be made free and clear of and without deduction for any present or future excise, stamp or other taxes, fees, duties, levies, imposts, charges, deductions, withholdings or other charges of any nature whatsoever imposed by any taxing authority, but excluding (i) franchise taxes, (ii) any taxes (other than withholding taxes) that would not be imposed but for a connection between the Administrative Agent, the Issuing Bank or a Lender and the jurisdiction imposing such taxes (other than a connection arising solely by virtue of the activities of the Administrative Agent, the Issuing Bank or such Lender pursuant to or in respect of this Agreement or any other Loan Document), (iii) any taxes imposed on or measured by the Issuing Bank's or any Lender's assets, net income, receipts or branch profits and (iv) any taxes arising after the Agreement Date solely as a result of or attributable to a Lender changing its designated Lending Office after the date such Lender becomes a party hereto, and (v) any taxes imposed by Sections 1471 through Section 1474 of the Internal Revenue Code (including any official interpretations thereof, collectively “FATCA”) on any “withholdable payment” payable to such recipient as a result of the failure of such recipient to satisfy the applicable requirements as set forth in FATCA after December 31, 2012 (such non‑excluded items being collectively called “Taxes”). If any withholding or deduction from any payment to be made by the Borrower hereunder is required in respect of any Taxes pursuant to any Applicable Law, then the Borrower will:
(i)
pay directly to the relevant Governmental Authority the full amount required to be so withheld or deducted;
(ii)
promptly forward to the Administrative Agent an official receipt or other documentation satisfactory to the Administrative Agent evidencing such payment to such Governmental Authority; and
(iii)
pay to the Administrative Agent for its account or the account of the applicable Lender or the Issuing Bank, as the case may be, such additional amount or amounts as is necessary to ensure that the net amount actually received by the Administrative Agent, the Issuing Bank or such Lender will equal the full amount that the Administrative Agent, the Issuing Bank or such Lender would have received had no such withholding or deduction been required.
(b)
Tax Indemnification
. If the Borrower fails to pay any Taxes when due to the appropriate Governmental Authority or fails to remit to the Administrative Agent, for its account or the account of the Issuing Bank or respective Lender, as the case may be, the required receipts or other required documentary evidence, the Borrower shall indemnify the Administrative Agent, the Issuing Bank and the Lenders for any incremental Taxes, interest or penalties that may become payable by the Administrative
Agent, the Issuing Bank or any Lender as a result of any such failure. For purposes of this Section, a distribution hereunder by the Administrative Agent or any Lender to or for the account of any Lender shall be deemed a payment by the Borrower.
(c)
Tax Forms
. Prior to the date that any Lender or Participant organized under the laws of a jurisdiction other than that in which the Borrower is a resident for tax purposes becomes a party hereto, such Person shall deliver to the Borrower and the Administrative Agent such certificates, documents or other evidence, as required by the Internal Revenue Code or Treasury Regulations issued pursuant thereto (including Internal Revenue Service Forms W-8ECI and W-8BEN, as applicable, or appropriate successor forms), properly completed, currently effective and duly executed by such Lender or Participant establishing that payments to it hereunder and under the Notes are (i) not subject to United States Federal backup withholding tax and (ii) not subject to United States Federal withholding tax under the Internal Revenue Code. Each such Lender or Participant shall, to the extent it may lawfully do so, (x) deliver further copies of such forms or other appropriate certifications on or before the date that any such forms expire or become obsolete and after the occurrence of any event requiring a change in the most recent form delivered to the Borrower or the Administrative Agent and (y) obtain such extensions of the time for filing, and renew such forms and certifications thereof, as may be reasonably requested by the Borrower or the Administrative Agent. The Borrower shall not be required to pay any amount pursuant to the last sentence of subsection (a) above to any Lender or Participant that is organized under the laws of a jurisdiction other than that in which the Borrower is a resident for tax purposes or the Administrative Agent, if it is organized under the laws of a jurisdiction other than that in which the Borrower is a resident for tax purposes, such Lender, such Participant or the Administrative Agent, as applicable, fails to comply with the requirements of this subsection. If any such Lender or Participant, to the extent it may lawfully do so, fails to deliver the above forms or other documentation, then the Administrative Agent may withhold from such payment to such Lender such amounts as are required by the Internal Revenue Code. If any Governmental Authority asserts that the Administrative Agent did not properly withhold or backup withhold, as the case may be, any tax or other amount from payments made to or for the account of any Lender, such Lender shall indemnify the Administrative Agent therefor, including all penalties and interest, any taxes imposed by any jurisdiction on the amounts payable to the Administrative Agent under this Section, and costs and expenses (including all fees and disbursements of any law firm or other external counsel and the allocated cost of internal legal services and all disbursements of internal counsel) of the Administrative Agent. The obligation of the Lenders under this Section shall survive the termination of the Commitments, repayment of all Obligations and the resignation or replacement of the Administrative Agent.
(d)
USA Patriot Act Notice; Compliance
. In order for the Administrative Agent to comply with the USA Patriot Act of 2001 (Public Law 107-56), prior to any Lender or Participant that is organized under the laws of a jurisdiction outside of the United States of America becoming a party hereto, the Administrative Agent may request, and such Lender or Participant shall provide to the Administrative Agent, its name, address, tax identification number and/or such other identification information as shall be necessary for the Administrative Agent to comply with federal law.
Article IV.
[
Reserved
]
Article V.
Yield Protection, Etc.
Section 5.1.
Additional Costs; Capital Adequacy.
(a)
Capital Adequacy
. If any Lender in the Loan determines that compliance with any law or regulation or with any guideline or request from any central bank or other Governmental Authority (whether or not having the force of law) affects or would affect the amount of capital required or expected to be maintained by such Lender, or any corporation controlling such Lender, as a consequence of, or with reference to, such Lender's or such corporation's Commitments or its making or maintaining Loans below the rate which such Lender or such corporation controlling such Lender could have achieved but for such compliance (taking into account the policies of such Lender or such corporation with regard to capital), then the Borrower shall, from time to time, within thirty (30) calendar days after written demand by such Lender, pay to such Lender additional amounts sufficient to compensate such Lender or such corporation controlling such Lender to the extent that such Lender determines such increase in capital is allocable to such Lender's obligations hereunder.
(b)
Additional Costs.
In addition to, and not in limitation of the immediately preceding clause (a), the Borrower shall following fifteen (15) days written demand therefor pay to the Administrative Agent for the account of a Lender such amounts as such Lender may reasonably determine to be necessary to compensate such Lender for any costs incurred by such Lender that it reasonably determines are attributable to its making or maintaining of any LIBOR Loans (or Base Rate Loans bearing interest based on the LIBOR Market Index Rate) or its obligation to make any LIBOR Loans (or any Base Rate Loans bearing interest based on the LIBOR Market Index Rate) hereunder, any reduction in any amount receivable by such Lender under this Agreement or any of the other Loan Documents in respect of any of such LIBOR Loans (or such Base Rate Loans bearing interest based on the LIBOR Market Index Rate) or such obligation or the maintenance by such Lender of capital in respect of its LIBOR Loans (or Base Rate Loans bearing interest based on the LIBOR Market Index Rate) or its Commitments (such increases in costs and reductions in amounts receivable being herein called “Additional Costs”), resulting from any Regulatory Change that: (i) changes the basis of taxation of any amounts payable to such Lender under this Agreement or any of the other Loan Documents in respect of any of such LIBOR Loans (or any such Base Rate Loans bearing interest based on the LIBOR Market Index Rate) or its Commitments (other than taxes imposed on or measured by the overall net income of such Lender or of its Lending Office for any of such LIBOR Loans (or such Base Rate Loans bearing interest based on the LIBOR Market Index Rate) by the jurisdiction in which such Lender has its principal office or such Lending Office), or (ii) imposes or modifies any reserve, special deposit or similar requirements (including without limitation, Regulation D of the Board of Governors of the Federal Reserve System or other similar reserve requirement applicable to any other category of liabilities or category of extensions of credit or other assets by reference to which the interest rate on LIBOR Loans (or Base Rate Loans bearing interest based on the LIBOR Market Index Rate) is determined) relating to any extensions of credit or other assets of, or any deposits with or other liabilities of, or other credit extended by, or any other acquisition of funds by such Lender (or its parent corporation), or any commitment of such Lender (including, without limitation, the Commitment of such Lender hereunder) or (iii) has or would have the effect of reducing the rate of return on capital of such Lender to a level below that which such Lender could have achieved or increasing any liquidity requirement but for such Regulatory Change (taking into consideration such Lender's policies with respect to capital adequacy and liquidity).
(c)
Lender's Suspension of LIBOR Loans.
Without limiting the effect of the provisions of the immediately preceding subsection (a) and (b), if by reason of any Regulatory Change, any Lender either (i) incurs Additional Costs based on or measured by the excess above a specified level of the amount of a category of deposits or other liabilities of such Lender that includes deposits by reference to which the interest rate on LIBOR Loans is determined as provided in this Agreement or a category of extensions of credit or other assets of such Lender that includes LIBOR Loans or (ii) becomes subject to restrictions on the amount of such a category of liabilities or assets that it may hold, then, if such Lender
so elects by notice to the Borrower (with a copy to the Administrative Agent), the obligation of such Lender to make or Continue, or to Convert Base Rate Loans into, LIBOR Loans shall be suspended until such Regulatory Change ceases to be in effect (in which case the provisions of Section 5.5. shall apply).
(d)
Additional Costs in Respect of Letters of Credit
. Without limiting the obligations of the Borrower under the preceding subsections of this Section (but without duplication), if as a result of any Regulatory Change or any risk-based capital guideline or other requirement heretofore or hereafter issued by any Governmental Authority there shall be imposed, modified or deemed applicable any tax, reserve, special deposit, capital adequacy, liquidity requirement or similar requirement against or with respect to or measured by reference to Letters of Credit and the result shall be to increase the cost to the Issuing Bank of issuing (or any Lender of purchasing participations in) or maintaining its obligation hereunder to issue (or purchase participations in) any Letter of Credit or reduce any amount receivable by the Issuing Bank or any Lender hereunder in respect of any Letter of Credit, then, upon demand by the Issuing Bank or such Lender, the Borrower shall pay immediately to the Issuing Bank or, in the case of such Lender, to the Administrative Agent for the account of such Lender, from time to time as specified by the Issuing Bank or such Lender, such additional amounts as shall be sufficient to compensate the Issuing Bank or such Lender for such increased costs or reductions in amount.
(e)
Notification and Determination of Additional Costs.
Each of the Administrative Agent, the Issuing Bank and each Lender, as the case may be, agrees to notify the Borrower of any event occurring after the Agreement Date entitling the Administrative Agent, the Issuing Bank or such Lender to compensation under any of the preceding subsections of this Section as promptly as practicable;
provided
,
however
, that if the Administrative Agent, the Issuing Bank or Lender shall fail to give such notice within forty-five (45) days after it obtains actual knowledge of such event, then the Administrative Agent, the Issuing Bank or Lender, as the case may be, shall only be entitled to compensation under any of the preceding subsections for compensable amounts attributable to such event arising following the date the Administrative Agent, the Issuing Bank or Lender, as the case may be, obtains actual knowledge of such event. The Administrative Agent, the Issuing Bank and each Lender, as the case may be, agrees to furnish to the Borrower (and in the case of the Issuing Bank or a Lender to the Administrative Agent as well) a certificate setting forth the basis and amount of each request for compensation under this Section. Determinations by the Administrative Agent, the Issuing Bank or such Lender, as the case may be, of the effect of any Regulatory Change shall be conclusive and binding for all purposes, provided that such determinations are made on a reasonable basis and in good faith.
Section 5.2.
Suspension of LIBOR Loans.
Anything herein to the contrary notwithstanding, if, on or prior to the determination of LIBOR for any Interest Period:
(a)
the Administrative Agent reasonably determines (which determination shall be conclusive) that quotations of interest rates for the relevant deposits referred to in the definition of LIBOR are not being provided in the relevant amounts or for the relevant maturities for purposes of determining rates of interest for LIBOR Loans as provided herein or is otherwise unable to determine LIBOR, or
(b)
the Administrative Agent reasonably determines (which determination shall be conclusive) that the relevant rates of interest referred to in the definition of LIBOR upon the basis of which the rate of interest for LIBOR Loans for such Interest Period is to be determined are not likely to adequately cover the cost to any Lender of making or maintaining LIBOR Loans for such Interest Period;
then the Administrative Agent shall give the Borrower and each Lender prompt notice thereof and, so long as such condition remains in effect, the Lenders shall be under no obligation to, and shall not, make additional LIBOR Loans, Continue LIBOR Loans or Convert Loans into LIBOR Loans and the Borrower shall, on the last day of each current Interest Period for each outstanding LIBOR Loan, either prepay such Loan or Convert such Loan into a Base Rate Loan.
Section 5.3.
Illegality.
Notwithstanding any other provision of this Agreement, if any Lender shall determine (which determination shall be conclusive and binding) that it is unlawful for such Lender to honor its obligation to make or maintain LIBOR Loans hereunder, then such Lender shall promptly notify the Borrower thereof (with a copy of such notice to the Administrative Agent) and such Lender's obligation to make or Continue, or to Convert Loans of any other Type into, LIBOR Loans shall be suspended, in each case, until such time as such Lender may again make and maintain LIBOR Loans (in which case the provisions of Section 5.5. shall be applicable).
Section 5.4.
Compensation.
The Borrower shall pay to the Administrative Agent for the account of each Lender, upon the request of the Administrative Agent, such amount or amounts as the Administrative Agent shall determine in its reasonable discretion shall be sufficient to compensate such Lender for any loss, cost or expense attributable to:
(a)
any payment or prepayment (whether mandatory or optional) of a LIBOR Loan, or Conversion of a LIBOR Loan, made by such Lender for any reason (including, without limitation, acceleration) on a date other than the last day of the Interest Period for such Loan; or
(b)
any failure by the Borrower for any reason (including, without limitation, the failure of any of the applicable conditions precedent specified in Article 6.2. to be satisfied) to borrow a LIBOR Loan from such Lender on the date for such borrowing, or to Convert a Base Rate Loan into a LIBOR Loan or Continue a LIBOR Loan on the requested date of such Conversion or Continuation.
Not in limitation of the foregoing, such compensation shall include, without limitation; in the case of a LIBOR Loan, an amount equal to the then present value of (A) the amount of interest that would have accrued on such LIBOR Loan for the remainder of the Interest Period at the rate applicable to such LIBOR Loan, less (B) the amount of interest that would accrue on the same LIBOR Loan for the same period if LIBOR were set on the date on which such LIBOR Loan was repaid, prepaid or Converted or the date on which the Borrower failed to borrow, Convert or Continue such LIBOR Loan, as applicable, calculating present value by using as a discount rate LIBOR quoted on such date. Upon the Borrower's request (made through the Administrative Agent) any Lender seeking compensation under this Section shall provide the Borrower with a statement setting forth the basis for requesting such compensation and the method for determining the amount thereof. Any such statement shall be conclusive absent manifest error.
Section 5.5.
Treatment of Affected Loans.
If the obligation of any Lender to make LIBOR Loans or to Continue, or to Convert Base Rate Loans into, LIBOR Loans shall be suspended pursuant to Section 5.1.(c), Section 5.2., or Section 5.3. then such Lender's LIBOR Loans shall be automatically Converted into Base Rate Loans on the last day(s) of the then current Interest Period(s) for LIBOR Loans (or, in the case of a Conversion required by
Section 5.1.(c), Section 5.2., or Section 5.3. on such earlier date as such Lender may specify to the Borrower with a copy to the Administrative Agent) and, unless and until such Lender gives notice as provided below that the circumstances specified in Section 5.1., Section 5.2., or Section 5.3. that gave rise to such Conversion no longer exist:
(i)
to the extent that such Lender's LIBOR Loans have been so Converted, all payments and prepayments of principal that would otherwise be applied to such Lender's LIBOR Loans shall be applied instead to its Base Rate Loans; and
(ii)
all Loans that would otherwise be made or Continued by such Lender as LIBOR Loans shall be made or Continued instead as Base Rate Loans, and all Base Rate Loans of such Lender that would otherwise be Converted into LIBOR Loans shall remain as Base Rate Loans.
If such Lender gives notice to the Borrower (with a copy to the Administrative Agent) that the circumstances specified in Section 5.1.(c) or 5.3. that gave rise to the Conversion of such Lender's LIBOR Loans pursuant to this Section no longer exist (which such Lender agrees to do promptly upon such circumstances ceasing to exist) at a time when LIBOR Loans made by other Lenders are outstanding, then such Lender's Base Rate Loans shall be automatically Converted, on the first day(s) of the next succeeding Interest Period(s) for such outstanding LIBOR Loans, to the extent necessary so that, after giving effect thereto, all Loans held by the Lenders holding LIBOR Loans and by such Lender are held pro rata (as to principal amounts, Types and Interest Periods) in accordance with their respective Commitments.
Section 5.6.
Affected Lenders.
If (a) a Lender (other than the Lender then acting as the Administrative Agent) requests compensation pursuant to Section 3.10. or 5.1., and the Requisite Lenders are not also doing the same, (b) the obligation of any Lender (other than the Lender then acting as the Administrative Agent) to make LIBOR Loans that are Revolving Loans or to Continue, or to Convert Base Rate Loans into, LIBOR Loans that are Revolving Loans shall be suspended pursuant to Section 5.1.(c) or 5.3. but the obligation of the Requisite Lenders shall not have been suspended under such Sections, or (c) a Lender does not vote in favor of any amendment, modification or waiver to this Agreement or any other Loan Document, which, pursuant to Section 13.7., requires the vote of such Lender, and the Requisite Lenders shall have voted in favor of such amendment, modification or waiver, then, so long as there does not then exist any Default or Event of Default, the Borrower may demand that such Lender (the “Affected Lender”), and upon such demand the Affected Lender shall promptly, assign its Commitments to an Eligible Assignee subject to and in accordance with the provisions of Section 13.6.(c) for a purchase price equal to (x) the aggregate principal balance of all Loans then owing to the Affected Lender, plus (y) the aggregate amount of payments previously made by the Affected Lender under Section 2.2.(j) that have not been repaid, plus (z) any accrued but unpaid interest thereon and accrued but unpaid fees owing to the Affected Lender, or any other amount as may be mutually agreed upon by such Affected Lender and Eligible Assignee. Each of the Administrative Agent and the Affected Lender shall reasonably cooperate in effectuating the replacement of such Affected Lender under this Section, but at no time shall the Administrative Agent, such Affected Lender nor any other Lender be obligated in any way whatsoever to initiate any such replacement or to assist in finding an Eligible Assignee. The exercise by the Borrower of its rights under this Section shall be at the Borrower's sole cost and expenses and at no cost or expense to the Administrative Agent, the Affected Lender or any of the other Lenders; provided, however, the Borrower shall not be obligated to reimburse or otherwise pay an Affected Lender's administrative or legal costs
incurred as a result of the Borrower's exercise of its rights under this Section. The terms of this Section shall not in any way limit the Borrower's obligation to pay to any Affected Lender compensation owing to such Affected Lender pursuant to Sections 3.10., 5.1. or 5.4. with respect to any matters or events existing on or prior to the date an Affected Lender ceases to be a party to this Agreement.
Section 5.7.
Change of Lending Office.
Each Lender agrees that it will use reasonable efforts (consistent with its internal policy and legal and regulatory restrictions) to designate an alternate Lending Office with respect to any of its Loans affected by the matters or circumstances described in Sections 3.10., 5.1. or 5.3. to reduce the liability of the Borrower or avoid the results provided thereunder, so long as such designation is not disadvantageous to such Lender as determined by such Lender in its sole discretion, except that such Lender shall have no obligation to designate a Lending Office located in the United States of America.
Section 5.8.
Assumptions Concerning Funding of LIBOR Loans.
Calculation of all amounts payable to a Lender under this Article V. shall be made as though such Lender had actually funded LIBOR Loans through the purchase of deposits in the relevant market bearing interest at the rate applicable to such LIBOR Loans in an amount equal to the amount of the LIBOR Loans and having a maturity comparable to the relevant Interest Period; provided, however, that each Lender may fund each of its LIBOR Loans in any manner it sees fit and the foregoing assumption shall be used only for calculation of amounts payable under this Article.
Article VI. Conditions Precedent
Section 6.1.
Initial Conditions Precedent.
The closing and effectiveness of this Agreement and the obligation of the Lenders to effect or permit the occurrence of the first Credit Event hereunder, whether as the making of a Loan or the issuance of a Letter of Credit, is subject to the satisfaction or waiver of the following conditions precedent (as confirmed to the Lenders by Administrative Agent):
(a)
The Administrative Agent shall have received each of the following, in form and substance satisfactory to the Administrative Agent:
(i)
counterparts of this Agreement executed by each of the parties hereto;
(ii)
Revolving Notes executed by the Borrower, payable to each Lender and complying with the terms of Section 2.11.(a) and the Swingline Note executed by the Borrower;
(iii)
a Guaranty executed by each of the Guarantors initially to be a party thereto, and the Parent Guaranty executed by the Parent;
(iv)
opinions of in-house and outside counsel of the Parent and the Borrower and the other Loan Parties, addressed to the Administrative Agent and the Lenders in form and substance acceptable to Administrative Agent;
(v)
the certificate or articles of incorporation or formation, articles of organization, certificate of limited partnership, declaration of trust or other comparable organizational instrument (if any) of (i) the Borrower and the Parent certified as of a recent date
by the Secretary of State of the state of formation of such Person and (ii) each other Loan Party filed with the Secretary of State of the state of formation of such Person, and in each case, certified by the Secretary or Assistant Secretary (or other individual performing similar functions) of such Person;
(vi)
a certificate of good standing (or certificate of similar meaning) with respect to the Parent and each Loan Party other than Georgia Square Partnership, Georgia Square Associates, Ltd. and Old Hickory Mall Venture issued as of a recent date by the Secretary of State of the state of formation of each such Person;
(vii)
a certificate of incumbency signed by the Secretary or Assistant Secretary (or other individual performing similar functions) of each Loan Party and the Parent with respect to each of the officers of such Person authorized to execute and deliver the Loan Documents to which such Person is a party, and in the case of the Borrower, authorized to execute and deliver on behalf of the Borrower Notices of Borrowing, Notices of Swingline Borrowing, requests for Letters of Credit, Notices of Conversion and Notices of Continuation;
(viii)
copies certified by the Secretary or Assistant Secretary (or other individual performing similar functions) of each Loan Party and the Parent of (A) the by-laws of such Person, if a corporation, the operating agreement, if a limited liability company, the partnership agreement, if a limited or general partnership, or other comparable document in the case of any other form of legal entity and (B) all corporate, partnership, member or other necessary action taken by such Person to authorize the execution, delivery and performance of the Loan Documents to which it is a party;
(ix)
a Compliance Certificate calculated on a pro forma basis for the Borrower's fiscal quarter ending June 30, 2012;
(x)
a Transfer Authorizer Designation Form effective as of the Agreement Date;
(xi)
the Fee Letter;
(xii)
evidence that the Fees, if any, then due and payable under Section 3.5., together with all other fees, expenses and reimbursement amounts due and payable to the Administrative Agent and any of the Lenders, including without limitation, the fees and expenses of counsel to the Administrative Agent, have been paid;
(xiii)
insurance certificates, or other evidence, providing that the insurance coverage required under Section 8.5. (including, without limitation, both property and liability insurance) is in full force and effect;
(xiv)
evidence that all Liens securing the indebtedness, liabilities or other obligations under the Existing Credit Agreement have been released; provided, that provision shall have been made for certain releases and terminations to be filed and fully effective within thirty (30) days after the Effective Date;
(xv)
the duly executed Officer's Certificate; and
(xvi)
such other documents and instruments as the Administrative Agent, or any Lender through the Administrative Agent, may reasonably request.
(b)
In the good faith judgment of the Administrative Agent:
(i)
there shall not have occurred or become known to the Administrative Agent or any of the Lenders any event, condition, situation or status since the date of the information contained in the financial and business projections, budgets, pro forma data and forecasts concerning the Parent, the Borrower and their Subsidiaries delivered to the Administrative Agent and the Lenders prior to the Agreement Date that has had or could reasonably be expected to result in a Material Adverse Effect;
(ii)
no litigation, action, suit, investigation or other arbitral, administrative or judicial proceeding shall be pending or threatened which could reasonably be expected to (A) result in a Material Adverse Effect or (B) restrain or enjoin, impose materially burdensome conditions on, or otherwise materially and adversely affect, the ability of any Loan Party or the Parent to fulfill its obligations under the Loan Documents to which it is a party;
(iii)
the Parent, the Borrower and the other Loan Parties shall have received all approvals, consents and waivers, and shall have made or given all necessary filings and notices as shall be required to consummate the transactions contemplated hereby without the occurrence of any default under, conflict with or violation of (A) any Applicable Law or (B) any agreement, document or instrument to which any Loan Party is a party or by which any of them or their respective properties is bound, except for such approvals, consents, waivers, filings and notices the receipt, making or giving of which, or the failure to make, give or receive which, would not reasonably be likely to (1) have a Material Adverse Effect, or (2) restrain or enjoin, impose materially burdensome conditions on, or otherwise materially and adversely affect the ability of the Borrower, any other Loan Party or the Parent to fulfill its obligations under the Loan Documents to which it is a party;
(iv)
the Borrower and each other Loan Party shall have provided all information requested by the Administrative Agent and each Lender in order to comply with the USA Patriot Act (Title III of Pub. L. 107-56 (signed into law October 26, 2001)); and
(v)
there shall not have occurred or exist any material disruption of financial or capital markets that could reasonably be expected to materially and adversely affect the transactions contemplated by the Loan Documents.
(c)
the Administrative Agent shall have received evidence satisfactory to it that (i) that certain $167,000,000 credit facility dated as of November 30, 2007, by and among Borrower and the Administrative Agent (and other lenders), known as “Starmount”, shall have been (or shall be concurrently with the effectiveness of this Agreement) repaid in full and terminated and (ii) the “Unsecured Indebtedness” covenant set forth in that certain $228,000,000 credit facility dated as of April 22, 2008, by and among Borrower and the Administrative Agent (and other lenders), known as “Westfield”, shall have been amended to allow the maximum ratio of “Unsecured Indebtedness” to “Gross Asset Value” (each as defined therein) to be increased to 0.15 to 1.00.
Section 6.2.
Conditions Precedent to All Loans and Letters of Credit.
The obligations of (i) Lenders to make any Loans, and (ii) the Issuing Bank to issue Letters of Credit are each subject to the terms of Section 2.15. and to the further conditions precedent that:
(a)
in the case of the making of a Loan, no Default or Event of Default shall exist as of the date of the making of such Loan or would exist immediately after giving effect thereto;
(b)
in the case of the issuance of a Letter of Credit, no Default or Event of Default shall exist as of the date of the issuance of such Letter of Credit or would exist immediately after giving effect thereto;
(c)
none of the conditions described in Section 2.15. would exist after giving effect to the making of such Loan or the issuance of such Letter of Credit;
(d)
the representations and warranties made or deemed made by the Parent, the Borrower and each other Loan Party in the Loan Documents to which any of them is a party, shall be true and correct in all material respects (except in the case of a representation or warranty qualified by materiality, in which case such representation or warranty shall be true and correct in all respects) on and as of the date of the making of such Loan or date of issuance of such Letter of Credit with the same force and effect as if made on and as of such date except to the extent that such representations and warranties expressly relate solely to an earlier date (in which case such representations and warranties shall have been true and accurate in all material respects (except in the case of a representation or warranty qualified by materiality, in which case such representation or warranty shall be true and correct in all respects) on and as of such earlier date) and except for changes in factual circumstances specifically and expressly permitted hereunder; and
(e)
in the case of the borrowing of Revolving Loans, the Administrative Agent shall have received a timely Notice of Borrowing, or in the case of a Swingline Loan, the Swingline Lender shall have received a timely Notice of Swingline Borrowing.
The occurrence of each Credit Event shall constitute a certification by the Borrower to the effect set forth in the preceding subsections (a) through (d) (both as of the date of the giving of notice relating to such Credit Event and, unless the Borrower otherwise notifies the Administrative Agent prior to the date of such Credit Event, as of the date of the occurrence of such Credit Event). In addition, the Borrower shall be deemed to have represented to the Administrative Agent and the Lenders at the time such Loan is made or such Letter of Credit is issued that to the best of the Borrower's knowledge all conditions to the making of such Loan or issuing of such Letter of Credit contained in this Article VI. have been satisfied.
Section 6.3.
Conditions as Covenants.
If the Lenders permit the making of any Loans, or the Issuing Bank issues a Letter of Credit, prior to the satisfaction of all conditions precedent set forth in Sections 6.1. and 6.2., such condition or conditions shall not be deemed waived unless Lenders or the Issuing Bank, as applicable, waive such condition or conditions in writing and, if requested by Lenders or the Issuing Bank, as applicable, Borrower shall nevertheless cause such condition or conditions to be satisfied within a reasonable period of time after the date of the making of such Loans or the issuance of such Letter of Credit. Unless set forth in writing to the contrary, the making of its initial Loan by a Lender shall constitute a confirmation by such Lender to the Administrative Agent and the other Lenders that insofar as such Lender is concerned the Borrower has satisfied the conditions precedent for initial Loans set forth in Sections 6.1. and 6.2.
Article VII. Representations and Warranties
Section 7.1.
Representations and Warranties.
In order to induce the Administrative Agent and each Lender to enter into this Agreement and to make Loans and to acquire participations in Letters of Credit and, in the case of the Issuing Bank, to issue Letters of Credit, the Borrower represents and warrants to the Administrative Agent, the Issuing Bank and each Lender as follows:
(a)
Organization; Power; Qualification
. Each of the Parent and the Loan Parties and the other Subsidiaries is a corporation, partnership or other legal entity, duly organized or formed, validly existing and in good standing under the jurisdiction of its incorporation or formation, has the power and authority to own or lease its respective properties and to carry on its respective business as now being and hereafter proposed to be conducted and is duly qualified and is in good standing as a domestic or foreign corporation, partnership or other legal entity, and authorized to do business, in each jurisdiction in which the character of its properties or the nature of its business requires such qualification or authorization and where the failure to be so qualified or authorized could reasonably be expected to have, in each instance, a Material Adverse Effect.
(b)
Ownership Structure
. Part I of
Schedule 7.1.(b)
is, as of the Agreement Date, a complete and correct list of each Loan Party and each other Limited Subsidiary, directly or indirectly, holding an Equity Interest in any Loan Party, setting forth for each such Person, (i) the jurisdiction of organization of such Person, (ii) each Person holding any Equity Interest in such Person, (iii) the nature of the Equity Interests held by each such Person and (iv) the percentage of ownership of such Person represented by such Equity Interests. As of the Agreement Date, except as disclosed in such Schedule, (A) each of the Parent, the Borrower and its applicable Subsidiaries owns, free and clear of all Liens, and has the unencumbered right to vote, all outstanding Equity Interests in each Person shown to be held by it on such Schedule, (B) all of the issued and outstanding capital stock of each such Person organized as a corporation is validly issued, fully paid and non-assessable and (C) there are no outstanding subscriptions, options, warrants, commitments, preemptive rights or agreements of any kind (including, without limitation, any stockholders' or voting trust agreements) for the issuance, sale, registration or voting of, or outstanding securities convertible into, any additional shares of capital stock of any class, or partnership or other ownership interests of any type in, any such Person. As of the Agreement Date, Part II of
Schedule 7.1.(b)
correctly sets forth (i) all Persons which have assets included in the Unencumbered Asset Value pursuant to clause (2) of the definition thereof and (ii) to the extent each such Person owns an Eligible Property, the Management Company and each Wholly Owned Subsidiary thereof, including the correct legal name of such Person, the type of legal entity which each such Person is, and all Equity Interests in such Person held directly or indirectly by the Borrower. Exhibit 21 to the Parent's Form 10-K for the fiscal year ended December 31, 2011 is an accurate list of the Subsidiaries of the Parent as of such date (excluding those Subsidiaries that need not be disclosed on such Exhibit pursuant to Regulation S-K of the Securities Act).
(c)
Authorization of Agreement, Notes, Loan Documents and Borrowings
. The Borrower has the right and power, and has taken all necessary action to authorize it, to borrow and obtain other extensions of credit hereunder. The Borrower, each other Loan Party and the Parent has the right and power, and has taken all necessary action to authorize it, to execute, deliver and perform each of the Loan Documents and the Fee Letter to which it is a party in accordance with their respective terms and to consummate the transactions contemplated hereby and thereby. The Loan Documents and the Fee Letter to which the Borrower, any other Loan Party or the Parent is a party have been duly executed and
delivered by the duly authorized officers of such Person and each is a legal, valid and binding obligation of such Person enforceable against such Person in accordance with its respective terms, except as the same may be limited by bankruptcy, insolvency, and other similar laws affecting the rights of creditors generally and the availability of equitable remedies for the enforcement of certain obligations contained herein or therein and as may be limited by equitable principles generally.
(d)
Compliance of Agreement, Etc. with Laws
. The execution, delivery and performance of this Agreement, the other Loan Documents to which any Loan Party or the Parent is a party and the Fee Letter in accordance with their respective terms and the borrowings and other extensions of credit hereunder do not and will not, by the passage of time, the giving of notice, or both: (i) require any Governmental Approval or violate any Applicable Law (including all Environmental Laws) relating to any Loan Party or the Parent; (ii) conflict with, result in a breach of or constitute a default under the organizational documents of the Borrower, any other Loan Party or the Parent, or any indenture, agreement or other instrument to which any Loan Party or the Parent is a party or by which it or any of its respective properties may be bound; or (iii) result in or require the creation or imposition of any Lien upon or with respect to any Property now owned or hereafter acquired by any Loan Party or the Parent other than in favor of the Administrative Agent for its benefit and the benefit of the Lenders and the Issuing Bank.
(e)
Compliance with Law; Governmental Approvals
. To the best of the knowledge of the Parent and the Borrower after due inquiry, the Parent, each Loan Party and each other Subsidiary is in compliance with each Governmental Approval and all other Applicable Laws relating to it except for non-compliances which, and Governmental Approvals the failure to possess which, could not, individually or in the aggregate, reasonably be expected to cause a Default or Event of Default or have a Material Adverse Effect.
(f)
Title to Properties; Liens
.
Schedule 7.1.(f)
is, as of the Agreement Date, a complete and correct listing of all Eligible Properties of the Borrower, each other Loan Party and each other Limited Subsidiary, setting forth, for each such Property, the current occupancy status of such Property and whether such Property is a Development Property or Unimproved Land. Each of the Loan Parties and each other Limited Subsidiary has good, marketable and legal title to, or a valid leasehold interest in, its respective assets.
(g)
Existing Indebtedness; Total Indebtedness
. The Parent's form 10-Q for the second quarter of fiscal year 2012 as filed with the Securities and Exchange Commission sets forth true, correct and complete information, on a consolidated basis, as of June 30, 2012, regarding all Indebtedness (including all Guarantees) and Total Indebtedness of the Parent and each of the Loan Parties. As of the Agreement Date, the Parent and the Loan Parties have materially performed and are in material compliance with all of the terms of such Indebtedness and all instruments and agreements relating thereto, and no default or event of default, or event or condition which with the giving of notice, the lapse of time, or both, would constitute a default or event of default, exists with respect to any such Indebtedness.
(h)
Material Contracts
.
Schedule 7.1.(h)
is, as of the Agreement Date, a true, correct and complete listing of all Material Contracts (other than Tenant Leases). Each of the Parent and the Loan Parties that are parties to any Material Contract has performed and is in compliance with all of the terms of such Material Contract, and no default or event of default, or event or condition which with the giving of notice, the lapse of time, or both, would constitute such a default or event of default, exists with respect to any such Material Contract.
(i)
Litigation
. Except as set forth on
Schedule 7.1.(i)
, there are no actions, suits or proceedings pending (nor, to the knowledge of any Loan Party or the Parent, are there any actions, suits or proceedings threatened, nor is there any basis therefor) against or in any other way relating adversely to or affecting the Parent, any Loan Party, any other Subsidiary or any of their respective property in any court or before any arbitrator of any kind or before or by any other Governmental Authority which, (i) if adversely determined, could reasonably be expected to have a Material Adverse Effect or (ii) in any manner draws into question the validity or enforceability of any Loan Documents or the Fee Letter. There are no strikes, slow downs, work stoppages or walkouts or other labor disputes in progress or threatened relating to, any Loan Party or any other Subsidiary that could reasonably be expected to have a Material Adverse Effect.
(j)
Taxes
. All federal, state and other tax returns of, the Borrower and the Parent required by Applicable Law to be filed have been duly filed (other than any return the filing date of which has been extended in accordance with Applicable Law), and all federal, state and other taxes, assessments and other governmental charges or levies upon, the Borrower and the Parent and each of their respective properties, income, profits and assets which are due and payable have been paid, except any such non-payment or non-filing which is at the time permitted under Section 8.6. As of the Agreement Date, none of the United States income tax returns of, either the Borrower or the Parent is under audit. All charges, accruals and reserves on the books of the Borrower and the Parent in respect of any taxes or other governmental charges are in accordance with GAAP.
(k)
Financial Statements
. The Borrower has furnished to each Lender copies of (i) the audited consolidated balance sheet of the Parent and its consolidated Subsidiaries for the fiscal years ended December 31, 2010 and December 31, 2011, and the related consolidated statements of operations, shareholders' equity and cash flow for the fiscal years ended on such dates, with the opinion thereon of Deloitte & Touche, and (ii) the unaudited consolidated balance sheet of the Parent and its consolidated Subsidiaries for the fiscal quarter ended June 30, 2012, and the related consolidated statements of operations, shareholders' equity and cash flow of the Parent and its consolidated Subsidiaries for the two (2) fiscal quarters ended on such date. Such balance sheets and statements (including in each case related schedules and notes) are complete and correct in all material respects and present fairly, in accordance with GAAP consistently applied throughout the periods involved, the consolidated financial position of the Borrower and its consolidated Subsidiaries as of their respective dates and the results of operations and the cash flow for such periods (subject, as to interim statements, to changes resulting from normal year-end audit adjustments). Neither the Parent, the Borrower nor any consolidated Subsidiary has on the Agreement Date any material contingent liabilities, liabilities, liabilities for taxes, unusual or long-term commitments or unrealized or forward anticipated losses from any unfavorable commitments, except as referred to or reflected or provided for in said financial statements.
(l)
No Material Adverse Change
. Since June 30, 2012, there has been no material adverse change in the consolidated financial condition, results of operations, business or prospects of the Parent and its Subsidiaries, or Borrower and its Subsidiaries, in each case, taken as a whole. Each of the Parent, the Borrower, the other Loan Parties and the other Limited Subsidiaries is Solvent.
(m)
ERISA
. Management Company and each member of the ERISA Group has fulfilled its obligations under the contribution requirements of ERISA and the Internal Revenue Code with respect to each Plan and is in compliance in all material respects with the presently applicable provisions of ERISA and the Internal Revenue Code with respect to each Plan. Neither Management Company nor any member of the ERISA Group has (i) sought a waiver of the minimum funding standard under Section 412 of the Internal Revenue Code in respect of any Plan, (ii) failed to make any contribution or payment to
any Plan or Multiemployer Plan or in respect of any Benefit Arrangement, or made any amendment to any Plan or Benefit Arrangement, which has resulted or could result in the imposition of a Lien or the posting of a bond or other security under ERISA or the Internal Revenue Code or (iii) incurred any liability under Title IV of ERISA other than a liability to the PBGC for premiums under Section 4007 of ERISA.
(n)
Absence of Default
. None of the Parent, the Loan Parties or the other Subsidiaries is in default under its certificate or articles of incorporation or formation, bylaws, partnership agreement or other similar organizational documents, and no event has occurred, which has not been remedied, cured or waived: (i) which constitutes a Default or an Event of Default; or (ii) which constitutes, or which with the passage of time, the giving of notice, or both, would constitute, a default or event of default by, the Parent or any Loan Party under any agreement (other than this Agreement) or judgment, decree or order to which any such Person is a party or by which any such Person or any of its respective properties may be bound where such default or event of default could, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.
(o)
Environmental Laws
. To the best of the knowledge of the Parent and the Borrower after due inquiry, each of Parent, the Loan Parties and the other Subsidiaries: (i) is in compliance with all Environmental Laws applicable to its business, operations and the Properties, (ii) has obtained all Governmental Approvals which are required under Environmental Laws, and each such Governmental Approval is in full force and effect, and (iii) is in compliance with all terms and conditions of such Governmental Approvals, where with respect to each of the immediately preceding clauses (i) through (iii) the failure to obtain or to comply with could be reasonably expected to have a Material Adverse Effect. Except for any of the following matters that could not be reasonably expected to have a Material Adverse Effect to the best of the knowledge of the Parent and the Borrower after due inquiry, neither the Parent nor any Loan Party is aware of, nor has it received notice of, any past present or pending releases, events, conditions, circumstances, activities, practices, incidents, facts, occurrences, actions, or plans that, with respect to Parent, any Loan Party or any other Subsidiary, their respective businesses, operations or with respect to the Properties, may: (i) cause or contribute to an actual or alleged violation of or non-compliance with Environmental Laws, (ii) cause or contribute to any other potential common-law or legal claim or other liability, or (iii) cause any of the Properties to become subject to any restrictions on ownership, occupancy, use or transferability under any Environmental Law or require the filing or recording of any notice, approval or disclosure document under any Environmental Law and, with respect to the immediately preceding clauses (i) through (iii) is based on or related to the on-site or off-site manufacture, generation, processing, distribution, use, treatment, storage, disposal, transport, removal, clean up or handling, or the emission, discharge, release or threatened release of any wastes or Hazardous Material, or any other requirement under Environmental Law. There is no civil, criminal, or administrative action, suit, demand, claim, hearing, notice, or demand letter, mandate, order, lien, request, investigation, or proceeding pending or, to the Parent's or the Borrower's knowledge after due inquiry, threatened, against Parent, any Loan Party or any other Subsidiary relating in any way to Environmental Laws which, reasonably could be expected to have a Material Adverse Effect. None of the Properties is listed on or proposed for listing on the National Priority List promulgated pursuant to the Comprehensive Environmental Response, Compensation and Liability Act of 1980 and its implementing regulations, or any state or local priority list promulgated pursuant to any analogous state or local law. To Parent's and Borrower's knowledge, no Hazardous Materials generated at or transported from the Properties is or has been transported to, or disposed of at, any location that is listed or proposed for listing on the National Priority List or any analogous state or local priority list, or any other location that is or has been the subject of a clean-up, removal or remedial action pursuant to any Environmental Law, except to the extent
that such transportation or disposal could not reasonably be expected to result in a Material Adverse Effect.
(p)
Investment Company
. Neither Parent, any Loan Party, nor any other Subsidiary is (i) an “investment company” or a company “controlled” by an “investment company” within the meaning of the Investment Company Act of 1940, as amended, or (ii) subject to any other Applicable Law which purports to regulate or restrict its ability to borrow money or obtain other extensions of credit or to consummate the transactions contemplated by this Agreement or to perform its obligations under any Loan Document to which it is a party.
(q)
Margin Stock
. Neither the Parent, any Loan Party nor any other Subsidiary is engaged principally, or as one of its important activities, in the business of extending credit for the purpose, whether immediate, incidental or ultimate, of buying or carrying “margin stock” within the meaning of Regulation U of the Board of Governors of the Federal Reserve System.
(r)
Affiliate Transactions
. Except as permitted by Section 10.9. or as otherwise set forth on
Schedule 7.1.(r)
, neither Parent nor any Loan Party is a party to or bound by any agreement or arrangement (whether oral or written) with any Affiliate (other than a Third Party Affiliate).
(s)
Intellectual Property
. Each of the Parent, the Loan Parties and each other Subsidiary owns or has the right to use, under valid license agreements or otherwise, all patents, licenses, franchises, trademarks, trademark rights, service marks, service mark rights, trade names, trade name rights, trade secrets and copyrights (collectively, “Intellectual Property”) necessary to the conduct of its businesses, without known conflict with any patent, license, franchise, trademark, trademark right, service mark, service mark right, trade secret, trade name, copyright, or other proprietary right of any other Person. All such Intellectual Property is fully protected and/or duly and properly registered, filed or issued in the appropriate office and jurisdictions for such registrations, filing or issuances. To Borrower's knowledge, no material claim has been asserted by any Person with respect to the use of any such Intellectual Property, or challenging or questioning the validity or effectiveness of any such Intellectual Property. To Borrower's knowledge, the use of such Intellectual Property by the Borrower, the other Loan Parties and the other Subsidiaries does not infringe on the rights of any Person, subject to such claims and infringements as do not, in the aggregate, give rise to any liabilities on the part of the Borrower, any other Loan Party or any other Subsidiary that could reasonably be expected to have a Material Adverse Effect.
(t)
Business
. As of the Agreement Date, the Parent, the Loan Parties and the other Limited Subsidiaries are primarily engaged in the business of owning and operating regional malls, strip shopping centers, outlet malls, and mixed-use commercial properties.
(u)
Broker's Fees
. No broker's or finder's fee, commission or similar compensation will be payable with respect to the transactions contemplated hereby.
(v)
Accuracy and Completeness of Information
. All written information, reports and other papers and data furnished to the Administrative Agent or any Lender by, on behalf of, or at the direction of, the Parent, any Loan Party or any other Subsidiary were, at the time the same were so furnished, complete and correct in all material respects, to the extent necessary to give the recipient a true and accurate knowledge of the subject matter, or, in the case of financial statements, present fairly, in accordance with GAAP consistently applied throughout the periods involved, the financial position of the Persons involved as at the date thereof and the results of operations for such periods. No fact is known to the Parent or any Loan Party which has had, or may in the future have (so far as any Loan Party can reasonably foresee), a Material Adverse Effect which has not been set forth in the financial statements
referred to in Section 7.1.(k) or in such information, reports or other papers or data or otherwise disclosed in writing to the Administrative Agent and the Lenders prior to the Effective Date. No document furnished or written statement made to the Administrative Agent or any Lender in connection with the negotiation, preparation or execution of, or pursuant to, this Agreement or any of the other Loan Documents contains or will contain any untrue statement of a fact material to the creditworthiness of Parent, any Loan Party or any other Subsidiary or omits or will omit to state a material fact necessary in order to make the statements contained therein not misleading.
(w)
Not Plan Assets; No Prohibited Transactions
. For purposes of ERISA and the Internal Revenue Code, none of the assets of the Parent, any Loan Party or any other Subsidiary constitutes “plan assets”, within the meaning of ERISA, the Internal Revenue Code and the respective regulations promulgated thereunder, of any Plan. The execution, delivery and performance of the Loan Documents and the Fee Letter by the Loan Parties and the Parent, and the borrowing, other credit extensions and repayment of amounts thereunder, do not and will not constitute “prohibited transactions” under ERISA or the Internal Revenue Code.
(x)
OFAC
. None of the Parent, the Borrower, any of the other Loan Parties, any of the other Subsidiaries, or any other Affiliate of the Parent or the Borrower (provided, however, such representation or warranty with respect to any Third Party Affiliate is made to the best knowledge of the Parent and the Borrower): (i) is a person named on the list of Specially Designated Nationals or Blocked Persons maintained by the U.S. Department of the Treasury's Office of Foreign Assets Control (“OFAC”) available at http://www.treas.gov/offices/enforcement/ofac/index.shtml, or as otherwise published from time to time; (ii) is (A) an agency of the government of a country, (B) an organization controlled by a country, or (C) a person resident in a country that is subject to a sanctions program identified on the list maintained by OFAC and available at http://www.treas.gov/offices/enforcement/ofac/index.shtml, or as otherwise published from time to time, as such program may be applicable to such agency, organization or person; or (iii) derives any of its assets or operating income from investments in or transactions with any such country, agency, organization or person; and none of the proceeds from the Loan will be used to finance any operations, investments or activities in, or make any payments to, any such country, agency, organization, or person.
(y)
REIT Status
. The Parent qualifies as, and has elected to be treated as, a REIT and is in compliance with all requirements and conditions imposed under the Internal Revenue Code to allow the Parent to maintain its status as a REIT.
(z)
Unencumbered Properties
. Each Property included in calculations of the Unencumbered Asset Value satisfies all of the requirements (including those in the definition of “Eligible Property”) contained in this Agreement for the same to be included therein.
(aa)
Legal Restrictions on Ability to Borrow
. Neither the Parent nor any Loan Party is subject to any Applicable Law which purports to regulate or restrict its ability to borrow money or obtain other extensions of credit or to consummate the transactions contemplated by this Agreement or to perform its obligations under any Loan Document to which it is a party.
Section 7.2.
Survival of Representations and Warranties, Etc.
All statements contained in any certificate, financial statement or other instrument delivered by or on behalf of any Loan Party or the Parent, to the Administrative Agent or any Lender pursuant to or in connection with this Agreement or any of the other Loan Documents (including, but not limited to, any such statement made in or in connection with any amendment thereto or any statement contained in any
certificate, financial statement or other instrument delivered by or on behalf of any Loan Party or the Parent prior to the Agreement Date and delivered to the Administrative Agent or any Lender in connection with the underwriting or closing the transactions contemplated hereby) shall constitute representations and warranties made by the Borrower under this Agreement. All representations and warranties made under this Agreement and the other Loan Documents shall be deemed to be made at and as of the Agreement Date, the Effective Date and at and as of the date of the occurrence of each Credit Event, except to the extent that such representations and warranties expressly relate solely to an earlier date (in which case such representations and warranties shall have been true and accurate on and as of such earlier date) and except for changes in factual circumstances expressly and specifically permitted hereunder. All such representations and warranties shall survive the effectiveness of this Agreement, the execution and delivery of the Loan Documents and the making of the Loans and the issuance of the Letters of Credit, but shall terminate upon the termination of this Agreement in accordance with, but subject to, the provisions of Section 13.11.
Article VIII. Affirmative Covenants
For so long as this Agreement is in effect, unless the Requisite Lenders (or, if required pursuant to Section 13.7., all of the Lenders) shall otherwise consent in the manner provided for in Section 13.7., the Parent and the Borrower, as applicable, shall comply with the following covenants:
Section 8.1.
Preservation of Existence and Similar Matters.
Except as otherwise permitted under Section 10.4., the Parent and the Borrower shall, and shall cause each other Loan Party and each other Subsidiary to, preserve and maintain its respective existence, rights, franchises, licenses and privileges in the jurisdiction of its incorporation or formation and qualify and remain qualified and authorized to do business in each jurisdiction in which the character of its properties or the nature of its business requires such qualification and authorization and where the failure to be so authorized and qualified could reasonably be expected to have a Material Adverse Effect.
Section 8.2.
Compliance with Applicable Law.
The Parent and the Borrower shall, and shall cause each other Loan Party and each other Subsidiary to, comply with all Applicable Law, including the obtaining of all Governmental Approvals, the failure with which to comply could, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.
Section 8.3.
Maintenance of Property.
In addition to the requirements of any of the other Loan Documents, the Borrower shall, and shall cause each Subsidiary to, (a) protect and preserve all of its respective material properties, including, but not limited to, all Intellectual Property necessary to the conduct of its respective business, and maintain in good repair, working order and condition all tangible properties, ordinary wear and tear and insured casualty losses excepted, and (b) from time to time make or cause to be made all necessary repairs and replacements to such Properties, so that the business carried on in connection therewith may be properly conducted at all times.
Section 8.4.
Conduct of Business.
The Borrower shall, and shall cause the other Loan Parties and each other Limited Subsidiary to, carry on its respective businesses as described in Section 7.1.(t).
Section 8.5.
Insurance.
In addition to the requirements of any of the other Loan Documents, the Borrower shall, and shall cause each other Loan Party and each other Subsidiary to, maintain insurance (on a replacement cost basis) with financially sound and reputable insurance companies against such risks and in such amounts as are customarily maintained by Persons engaged in similar businesses or as may be required by Applicable Law. The Borrower shall from time to time deliver to the Administrative Agent upon request a detailed list, together with copies of certificates evidencing all policies of the insurance then in effect, stating the names of the insurance companies, the amounts and rates of the insurance, the dates of the expiration thereof and the properties and risks covered thereby. Such insurance shall, in any event, include terrorism coverage (to the extent reasonably available).
Section 8.6.
Payment of Taxes and Claims.
The Parent and the Borrower shall, and shall cause each other Loan Party and each other Subsidiary to, pay and discharge when due (a) all taxes, assessments and governmental charges or levies imposed upon it or upon its income or profits or upon any properties belonging to it, and (b) all lawful claims of materialmen, mechanics, carriers, warehousemen and landlords for labor, materials, supplies and rentals which, if unpaid, might become a Lien on any properties of such Person; provided, however, that this Section shall not require the payment or discharge of any such tax, assessment, charge, levy or claim which is (x) being contested in good faith by appropriate proceedings which operate to suspend the collection thereof and for which adequate reserves have been established on the books of such Person, or (y) bonded or otherwise insured against to the reasonable satisfaction of the Administrative Agent.
Section 8.7.
Books and Records; Inspections.
The Parent and the Borrower will, and will cause each other Loan Party and each other Subsidiary to, keep proper books of record and account in which full, true and correct entries shall be made of all dealings and transactions in relation to its business and activities. The Parent and the Borrower will, and the Borrower will cause each other Loan Party and each other Subsidiary to, permit representatives of the Administrative Agent or any Lender to visit and inspect any of their respective properties, to examine and make abstracts from any of their respective books and records and to discuss their respective affairs, finances and accounts with their respective officers, employees and independent public accountants (in the Borrower's presence if an Event of Default does not then exist), all at such reasonable times during business hours and as often as may reasonably be requested and so long as no Event of Default exists, with reasonable prior notice; provided, however, unless an Event of Default exists (a) only the Administrative Agent may exercise its rights under this Section which shall be limited to two (2) inspections during any period of twelve (12) consecutive months, and (b) the Administrative Agent may not discuss the affairs, finances and accounts of the Parent or the Borrower with their employees pursuant to this Section. The Borrower shall be obligated to reimburse the Administrative Agent and the Lenders for their actual costs and expenses incurred in connection with the exercise of their rights under this Section only if such exercise occurs while a Default or Event of Default exists.
Section 8.8.
Use of Proceeds.
The Borrower will only use the proceeds of Loans (a) for the payment of pre-development and development costs incurred in connection with Properties owned by the Borrower or any Subsidiary; (b) to finance acquisitions otherwise permitted under this Agreement; (c) to finance capital expenditures and the repayment of Indebtedness of the Borrower and its Subsidiaries; (d) to make equity investments otherwise permitted under this Agreement and (e) to provide for the general working capital needs of the
Borrower and its Subsidiaries and for other general corporate purposes of the Borrower and its Subsidiaries. The Borrower shall only use Letters of Credit for the same purposes for which it may use the proceeds of Loans. The Borrower shall not, and shall not permit any other Loan Party or any other Subsidiary or the Parent to, use any part of such proceeds to purchase or carry, or to reduce or retire or refinance any credit incurred to purchase or carry, any margin stock (within the meaning of Regulation U of the Board of Governors of the Federal Reserve System) or to extend credit to others for the purpose of purchasing or carrying any such margin stock if, in any such case, such use might result in any of the Loans or other Obligations being considered to be “purpose credit” directly or indirectly secured by margin stock within the meaning of Regulation U or Regulation X of the Board of Governors of the Federal Reserve System.
Section 8.9.
Environmental Matters.
The Borrower shall, and shall cause Parent, each Loan Party and each other Subsidiary to, comply with all Environmental Laws the failure with which to comply could reasonably be expected to have a Material Adverse Effect. The Borrower shall comply, and shall cause the Parent and each other Loan Party and each other Subsidiary to comply, and the Borrower shall use, and shall cause the Parent and each other Loan Party and each other Subsidiary to use, commercially reasonable efforts to cause all other Persons occupying, using or present on the Properties to comply, with all Environmental Laws in all material respects. The Borrower shall, and shall cause the Parent and each other Loan Party and each other Subsidiary to, promptly take all actions and pay or arrange to pay all costs necessary for it and for the Properties to comply in all material respects with all Environmental Laws and all Governmental Approvals, including actions to remove and dispose of all Hazardous Materials and to clean up the Properties as required under Environmental Laws, except that such requirement shall not prevent Borrower from first contesting matters in which it reasonably believes there has been no violation of any Environmental Law or Governmental Approval The Borrower shall, and shall cause the Parent and the Loan Parties and the other Subsidiaries to, promptly take all actions necessary to prevent the imposition of any Liens on any of their respective properties arising out of or related to any Environmental Laws. Nothing in this Section shall impose any obligation or liability whatsoever on the Administrative Agent or any Lender.
Section 8.10.
Further Assurances.
At the Borrower's cost and expense (provided such cost is reasonable and shall not have a Material Adverse Effect) and upon request of the Administrative Agent, the Borrower shall, and shall cause each other Loan Party and each other Subsidiary to, duly execute and deliver or cause to be duly executed and delivered, to the Administrative Agent such further instruments, documents and certificates, and do and cause to be done such further acts that may be reasonably necessary or advisable in the reasonable opinion of the Administrative Agent to carry out more effectively the provisions and purposes of this Agreement and the other Loan Documents.
Section 8.11.
Material Contracts.
The Borrower shall, and shall cause the Parent and each other Loan Party to, duly and punctually perform and comply with any and all material representations, warranties, covenants and agreements expressed as binding upon any such Person under any Material Contract. The Borrower shall not, and shall not permit the Parent and any other Loan Party to, do or knowingly permit to be done anything to impair materially the value of any of the Material Contracts.
Section 8.12.
REIT Status.
The Parent shall at all times maintain its status as, and election to be treated as, a REIT.
Section 8.13.
Exchange Listing.
The Parent shall maintain outstanding at least one class of common shares of the Parent having trading privileges on the New York Stock Exchange or the American Stock Exchange or which is subject to price quotations on The NASDAQ Stock Market's National Market System.
Section 8.14.
Guarantors.
(a)
Within five (5) Business Days (or such longer period as the Administrative Agent may reasonably determine) of (i) any Person becoming a Material Subsidiary (other than an Excluded Subsidiary) after the Agreement Date, (ii) any Subsidiary of the Borrower (other than an Excluded Subsidiary) becoming the owner, directly or indirectly, of the equity interests of any other Guarantor, (iii) solely with respect to any Subsidiary (other than an Excluded Subsidiary) that was a Material Subsidiary as of the Agreement Date and in good faith and without the actual knowledge of the Borrower did not become a Guarantor as of the Agreement Date, such Subsidiary's identification as being a Material Subsidiary, (iv) solely with respect to any Material Subsidiary that was not an Excluded Subsidiary but in good faith and with reasonable belief was identified by the Borrower to be an Excluded Subsidiary as of the Agreement Date and did not become a Guarantor as of the Agreement Date, May 13, 2013, (v) any Subsidiary that owns an Eligible Property or other asset, the value of which is included in the determination of Unencumbered Asset Value, incurring, acquiring or suffering to exist any Recourse Indebtedness of such Subsidiary, and (vi) any Subsidiary executing and delivering a Guaranty of, or otherwise becoming obligated in respect of, any Indebtedness of the Parent, the Borrower or any Subsidiary of the Borrower, the Borrower shall deliver to the Administrative Agent each of the following in form and substance satisfactory to the Administrative Agent: (a) an Accession Agreement executed by such Subsidiary and (b) the items that would have been delivered under subsections (iv) through (viii) and (xvi) of Section 6.1.(a) if such Person had been a Material Subsidiary on the Agreement Date; provided, that promptly (and in any event within five (5) Business Days) upon any Material Subsidiary which is an Excluded Subsidiary ceasing to be subject to the restriction which prevented it from becoming a Guarantor on the Effective Date or delivering an Accession Agreement pursuant to this Section, as the case may be, such Material Subsidiary shall comply with the provisions of this Section.
(b)
The Borrower may request in writing that the Administrative Agent release, and upon receipt of such request the Administrative Agent shall release, a Guarantor (but not the Parent) from its Guaranty so long as: (i) no Property owned by such Guarantor shall thereafter be included in the list of Eligible Properties, (ii) such Guarantor shall no longer be a Material Subsidiary and is not otherwise required to be a party to the Guaranty under the immediately preceding subsection (a) and (iii) no Default or Event of Default shall then be in existence or would occur as a result of such release. In the event the Borrower obtains an Investment Grade Rating during the term of this Agreement, the Borrower may request in writing that the Administrative Agent release, so long as there is no Default or Event of Default in existence or that would occur as a result of such release, and upon receipt of such request the Administrative Agent shall release, each of the Guarantors (but not (x) the Parent, (y) any Subsidiary required to become a Guarantor pursuant to Section 8.14.(a)(v) or (vi), or (z) any Subsidiary that holds title to any Eligible Property or any other asset the value of which is included in the determination of Unencumbered Asset Value solely to the extent any Equity Interests of such Subsidiary are owned, directly or indirectly, by any Subsidiary of the Borrower that is an Excluded Subsidiary pursuant to clause (a)(x)(ii) of the definition of such term (such Subsidiary under this clause (z) being a “Continuing Guarantor Subsidiary”)) from the Guaranty, the Guaranty (but not the Parent Guaranty and other than
with respect to any Subsidiary required to become a Guarantor pursuant to Section 8.14(a)(v) or (vi) and any Continuing Guarantor Subsidiary) shall be terminated in accordance with the terms hereof and thereof, and, except to the extent required pursuant to Section 8.14.(a)(v) or (vi) and with respect to any Continuing Guarantor Subsidiary, no future Subsidiary of the Borrower shall be required to provide a Guaranty.
(c)
Within five (5) Business Days of the Parent executing and delivering a Guaranty of any Indebtedness of the Borrower or any Subsidiary (except for (i) guaranties of customary exceptions for fraud, misapplication of funds, environmental indemnities, voluntary bankruptcy, collusive involuntary bankruptcy and other similar exceptions to non-recourse liability, (ii) the Indebtedness set forth on
Schedule 8.14.(c)
, and (iii) guaranties of tenant improvement allowances with respect to any Property owned by any of its Subsidiaries
to the extent such guaranties are entered into in the ordinary course of the Borrower's business and consistent with past practice),
the Borrower shall cause the Parent to amend the Parent Guaranty to unconditionally guaranty the Obligations hereunder in their entirety.
Article IX. Information
For so long as this Agreement is in effect, unless the Requisite Lenders (or, if required pursuant to Section 13.7., all of the Lenders) shall otherwise consent in the manner set forth in Section 13.7., the Borrower shall furnish to the Administrative Agent at the Principal Office for distribution to each of the Lenders:
Section 9.1.
Quarterly Financial Statements.
Within five (5) Business Days of the filing thereof, a copy of each report on Form 10-Q (or its equivalent) which the Parent shall file with the Securities and Exchange Commission (or any Governmental Authority substituted therefor). If the Parent ceases to file such reports, or if any such report filed does not contain any of the following, then the Borrower shall deliver as soon as available and in any event within forty-five (45) days after the close of each of the first, second and third fiscal quarters of the Parent, the unaudited consolidated balance sheet of the Parent and its Subsidiaries as at the end of such period and the related unaudited consolidated statements of operations, stockholders' equity and cash flows of the Parent and its Subsidiaries for such period, setting forth in each case in comparative form the figures as of the end of and for the corresponding periods of the previous fiscal year, all of which shall be certified by the chief financial officer of the Parent, in his or her opinion, to present fairly, in accordance with GAAP and in all material respects, the consolidated financial position of the Parent and its Subsidiaries as at the date thereof and the results of operations for such period (subject to normal year-end audit adjustments).
Section 9.2.
Year-End Statements.
Within five (5) Business Days of the filing thereof, a copy of each report on Form 10-K (or its equivalent) which the Parent shall file with the Securities and Exchange Commission (or any Governmental Authority substituted therefor). If the Parent ceases to file such reports, or if any such report filed does not contain any of the following, then the Borrower shall deliver as soon as available and in any event within ninety (90) days after the end of each fiscal year of the Parent, the audited consolidated balance sheet of the Parent and its Subsidiaries as at the end of such fiscal year and the related audited consolidated statements of operations, stockholders' equity and cash flows of the Parent and its Subsidiaries for such fiscal year, setting forth in comparative form the figures as at the end of and
for the previous fiscal year, all of which shall be certified by (a) the chief financial officer of the Parent, in his or her opinion, to present fairly, in accordance with GAAP, the financial position of the Parent and its Subsidiaries as at the date thereof and the result of operations for such period and (b) Deloitte & Touche or any other independent certified public accountants of recognized national standing reasonably acceptable to the Requisite Lenders, whose certificate shall be unqualified and in scope and substance required by generally accepted auditing standards and who shall have authorized the Parent to deliver such financial statements and certification thereof to the Administrative Agent and the Lenders pursuant to this Agreement.
Section 9.3.
Compliance Certificate.
At the time the financial statements are furnished pursuant to the immediately preceding Sections 9.1. and 9.2., (a) a certificate substantially in the form of
Exhibit K
(a “Compliance Certificate”) executed on behalf of the Borrower by any officer of the Parent having a position of at least a senior vice-president or the Parent's vice president of accounting (i) setting forth as of the end of such quarterly accounting period or fiscal year, as the case may be, the calculations required to establish whether the Parent was in compliance with the covenants contained in Section 10.1.; and (ii) stating that to the best of such officer's knowledge, no Default or Event of Default exists, or, if such is not the case, specifying such Default or Event of Default and its nature, when it occurred and the steps being taken by the Parent with respect to such event, condition or failure, (b) a statement of cash flow for such quarterly accounting period or fiscal year, (c) a report of newly acquired Properties for such quarterly accounting period or fiscal year, including the Net Operating Income, cost and Mortgage Indebtedness, if any, of each such Property, and (d) a schedule of the Properties comprising Unencumbered Asset Value detailing trailing twelve (12) month Net Operating Income, GAAP undepreciated cost basis, Occupancy Rate and a calculation of Unencumbered Asset Value for such quarterly accounting period or fiscal year.
Section 9.4.
Other Information.
(a)
Within ten (10) Business Days of the filing thereof, and if the same are not available on-line free of charge from either the website of the Securities and Exchange Commission or the website of the Parent, copies of all press releases, shareholder reports, registration statements (excluding the exhibits thereto and any registration statements on Form S-8 or its equivalent), reports on Forms 10-K, 10-Q and 8-K (or their equivalents) and all other periodic reports which the Parent, any Loan Party or any other Subsidiary shall file with the Securities and Exchange Commission (or any Governmental Authority substituted therefor) or any national securities exchange;
(b)
No later than sixty (60) days after the end of each fiscal year of the Parent ending prior to the Maturity Date, projected balance sheets, operating statements, profit and loss projections and cash flow budgets (including sources and uses of cash) of the Parent and its Subsidiaries on a consolidated basis for each quarter
of the next succeeding fiscal year, all itemized in reasonable detail. The foregoing shall be accompanied by pro forma calculations, together with detailed assumptions, required to establish whether or not the Parent, and when appropriate its consolidated Subsidiaries, will be in compliance with the covenants contained in Sections 10.1. and at the end of each fiscal quarter of the remainder of the fiscal year;
(c)
If and when any member of the ERISA Group or the Management Company (i) gives or is required to give notice to the PBGC of any “reportable event” (as defined in Section 4043 of ERISA) with respect to any Plan which might constitute grounds for a termination of such Plan under Title IV of ERISA, or knows that the plan administrator of any Plan has given or is required to give notice of any such
reportable event, a copy of the notice of such reportable event given or required to be given to the PBGC; (ii) receives notice of complete or partial withdrawal liability under Title IV of ERISA or notice that any Multiemployer Plan is in reorganization, is insolvent or has been terminated, a copy of such notice; (iii) receives notice from the PBGC under Title IV of ERISA of an intent to terminate, impose liability (other than for premiums under Section 4007 of ERISA) in respect of, or appoint a trustee to administer any Plan, a copy of such notice; (iv) applies for a waiver of the minimum funding standard under Section 412 of the Internal Revenue Code, a copy of such application; (v) gives notice of intent to terminate any Plan under Section 4041(c) of ERISA, a copy of such notice and other information filed with the PBGC; (vi) gives notice of withdrawal from any Plan pursuant to Section 4063 of ERISA, a copy of such notice; or (vii) fails to make any payment or contribution to any Plan or Multiemployer Plan or in respect of any Benefit Arrangement or makes any amendment to any Plan or Benefit Arrangement which has resulted or could result in the imposition of a Lien or the posting of a bond or other security, a certificate of the controller of the Borrower setting forth details as to such occurrence and action, if any, which the Borrower, Management Company, or applicable member of the ERISA Group is required or proposes to take;
(d)
To the extent any Senior Officer is aware of the same, prompt notice of any notification received from, any inquiry by or the commencement of any proceeding or investigation by or before any Governmental Authority and any action or proceeding in any court or other tribunal or before any arbitrator against or in any other way relating adversely to, or adversely affecting, the Parent, any Loan Party or any other Subsidiary or any of their respective properties, assets or businesses (including but not limited to any notification of a material violation of any law or regulation) which, if determined or resolved adversely to such Person, could reasonably be expected to have a Material Adverse Effect, and prompt notice of the receipt of notice that any United States income tax returns of any Loan Party or any other Subsidiary are being audited;
(e)
A copy of any amendment to the certificate or articles of incorporation or formation, bylaws, partnership agreement or other similar organizational documents of the Parent, the Borrower, or any other Loan Party within five (5) Business Days after the effectiveness thereof;
(f)
Prompt notice of any change in the Chairman, Chief Executive Officer, President or Chief Financial Officer of the Parent, the Borrower, the Management Company or any other Loan Party and any change in the business, assets, liabilities, financial condition, results of operations or business prospects of the Parent or any Loan Party which has had or could reasonably be expected to have Material Adverse Effect;
(g)
Prompt notice of (i) the occurrence of any Default or Event of Default or (ii) any event which constitutes or which with the passage of time, the giving of notice, or otherwise, would constitute a default or event of default by Parent, any Loan Party or any other Subsidiary under any Material Contract to which any such Person is a party or by which any such Person or any of its respective properties may be bound;
(h)
Prompt notice of any order, judgment or decree which is not covered by insurance and which is in excess of $1,000,000 having been entered against the Parent or any Loan Party or any of their respective properties or assets;
(i)
Prompt notice of any guaranty executed by a Subsidiary guaranteeing indebtedness of the Parent or Borrower and which, as a result thereof, is required to execute an Accession Agreement pursuant to Section 8.14.;
(j)
Prompt notice of the acquisition, incorporation or other creation of any Subsidiary, the purpose for such Subsidiary, the nature of the assets and liabilities thereof, whether such Subsidiary is a Wholly Owned Subsidiary of the Borrower, and whether such Subsidiary is a Material Subsidiary;
(k)
Promptly upon the request of the Administrative Agent, evidence of the Borrower's calculation of the Ownership Share with respect to a Subsidiary or an Unconsolidated Affiliate, such evidence to be in form and detail satisfactory to the Administrative Agent;
(l)
Promptly, upon any change in the Parent's or Borrower's Credit Rating, a certificate stating that the Parent's or the Borrower's Credit Rating has changed and the new Credit Rating that is in effect;
(m)
Promptly, upon each request, information identifying the Parent or Borrower as a Lender may request in order to comply with the USA Patriot Act (Title III of Pub. L. 107-56 (signed into law October 26, 2001));
(n)
Within ten (10) days after the Borrower obtains knowledge thereof, the Borrower shall provide the Administrative Agent with written notice of the occurrence of any of the following: (i) the Borrower, the Parent, any Loan Party or any other Subsidiary shall receive notice that any violation of or non-compliance with any Environmental Law has or may have been committed; (ii) the Borrower, the Parent, any Loan Party or any other Subsidiary shall receive notice that any administrative or judicial complaint, order or petition has been filed or other proceeding has been initiated, or is about to be filed or initiated against any such Person alleging any violation of or non-compliance with any Environmental Law or requiring any such Person to take any action in connection with the release or threatened release of Hazardous Materials; or (iii) the Parent, the Borrower, any Loan Party or any other Subsidiary shall receive any notice from a Governmental Authority or private party alleging that any such Person may be liable or responsible for any costs associated with a response to, or remediation or cleanup of, a release or threatened release of Hazardous Materials or any damages caused thereby, and
such notice(s), whether individually or in the aggregate, could reasonably be expected to have a Material Adverse Effect;
(o)
From time to time and promptly upon each request, such data, certificates, reports, statements, documents or further information regarding any Property or the business, assets, liabilities, financial condition, results of operations or business prospects of the Parent, the Borrower, any of their respective Subsidiaries, any other Loan Party or the Management Company as the Administrative Agent or any Lender may reasonably request; and
(p)
No more than thirty (30) days following the consummation of any transaction of acquisition, merger or purchase of assets, involving consideration, or valued, in excess of $300,000,000, whether in a single transaction or related series of transactions, written notice of such transaction or transactions, together with a reasonably detailed description thereof, provided however, that this Section 9.4.(p) shall not eliminate any requirement in Section 10.4. or elsewhere herein that Borrower provide notice to the Administrative Agent and/or receive approval or consent from the Administrative Agent and/or the Lenders prior to such transactions.
(q)
No more than ten (10) Business Days following the consummation of any disposition of an asset or pool of assets, involving consideration, or valued, in excess of $500,000,000, whether in a single transaction or related series of transactions, written notice of such transaction or transactions, together with a reasonably detailed description thereof, provided however, that this Section 9.4.(q) shall not eliminate any requirement in Section 10.4. or elsewhere herein that Borrower provide notice to the
Administrative Agent and/or receive approval or consent from the Administrative Agent and/or the Lenders prior to such transactions.
Section 9.5.
Electronic Delivery of Certain Information.
(a)
Documents required to be delivered pursuant to the Loan Documents shall be delivered by electronic communication and delivery, including, the Internet, e-mail or intranet websites to which the Administrative Agent and each Lender have access (including a commercial, third-party website such as www.sec.gov <http://www.sec.gov> or a website sponsored or hosted by the Administrative Agent or the Borrower) provided that the foregoing shall not apply to (i) notices to any Lender (or the Issuing Bank) pursuant to Article II., (ii) any Lender that has notified the Administrative Agent or Borrower that it cannot or does not want to receive electronic communications and (iii) notices of Default or Event of Default. The Administrative Agent or the Borrower may, in its discretion, agree to accept notices and other communications to it hereunder by electronic delivery pursuant to procedures approved by it for all or particular notices or communications. Documents or notices delivered electronically shall be deemed to have been delivered twenty-four (24) hours after the date and time on which the Administrative Agent or Borrower posts such documents or the documents become available on a commercial website and the Administrative Agent or Borrower notifies each Lender of said posting and provides a link thereto provided if such notice or other communication is not sent or posted during the normal business hours of the recipient, said posting date and time shall be deemed to have commenced as of 11:00 a.m. Central time on the opening of business on the next Business Day for the recipient. Notwithstanding anything contained herein, in every instance the Borrower shall be required to provide paper copies of the Compliance Certificate required by Section 9.3. to the Administrative Agent and shall deliver paper copies of any documents to the Administrative Agent or to any Lender that requests such paper copies until a written request to cease delivering paper copies is given by the Administrative Agent or such Lender. Except for the Compliance Certificates required by Section 9.3., the Administrative Agent shall have no obligation to request the delivery of or to maintain paper copies of the documents delivered electronically, and in any event shall have no responsibility to monitor compliance by the Borrower with any such request for delivery. Each Lender shall be solely responsible for requesting delivery to it of paper copies and maintaining its paper or electronic documents.
(b)
Documents required to be delivered pursuant to Article II. may be delivered electronically to a website provided for such purpose by the Administrative Agent pursuant to the procedures provided to the Borrower by the Administrative Agent.
Section 9.6.
Public/Private Information.
The Borrower and the Parent shall cooperate with the Administrative Agent in connection with the publication of certain materials and/or information provided by or on behalf of the Borrower or the Parent. Documents required to be delivered pursuant to the Loan Documents shall be delivered by or on behalf of the Borrower or the Parent to the Administrative Agent and the Lenders (collectively, “Information Materials”) pursuant to this Article and shall designate Information Materials (a) that are either available to the public or not material with respect to the Borrower and its Subsidiaries or any of their respective securities for purposes of United States federal and state securities laws, as “Public Information” and (b) that are not Public Information as “Private Information”.
Section 9.7.
USA Patriot Act Notice; Compliance.
The USA Patriot Act of 2001 (Public Law 107-56) and federal regulations issued with respect thereto require all financial institutions to obtain, verify and record certain information that identifies
individuals or business entities which open an “account” with such financial institution. Consequently, a Lender (for itself and/or as Administrative Agent for all Lenders hereunder) may from time-to-time request, and the Borrower shall, and shall cause the Parent and the other Loan Parties, to provide to such Lender, Borrower's, Parent's, each Guarantor's and each other Loan Party's name, address, tax identification number and/or such other identification information as shall be necessary for such Lender to comply with federal law. An “account” for this purpose may include, without limitation, a deposit account, cash management service, a transaction or asset account, a credit account, a loan or other extension of credit, and/or other financial services product. Each Lender will treat all information furnished to it in accordance with this Section 9.7. in the manner required by Section 13.9. of this Agreement.
Article X. Negative Covenants
For so long as this Agreement is in effect, unless the Requisite Lenders (or, if required pursuant to Section 13.7., all of the Lenders) shall otherwise consent in the manner set forth in Section 13.7., the Borrower or the Parent, as the case may be, shall comply with the following covenants:
Section 10.1.
Financial Covenants.
(a)
Minimum Tangible Net Worth
. The Parent shall not permit Tangible Net Worth of the Parent and its Subsidiaries at any time to be less than (i) $1,279,179,000,
plus
(ii) seventy percent (70%) of the Net Proceeds of all Equity Issuances effected at any time after June 30, 2012 by the Parent or any of its Subsidiaries to any Person other than the Parent or any of the Parent's Wholly Owned Subsidiaries.
(b)
Ratio of Total Indebtedness to Total Asset Value
. The Parent shall not permit the ratio of (i) Total Indebtedness of the Parent and its Subsidiaries determined on a consolidated basis to (ii) Total Asset Value of the Parent and its Subsidiaries determined on a consolidated basis to exceed 0.60 to 1.00 at any time.
(c)
Ratio of Unencumbered Asset Value to Unsecured Indebtedness
. The Parent shall not permit the ratio of (i) Unencumbered Asset Value determined on a consolidated basis to (ii) Unsecured Indebtedness of the Parent and its Subsidiaries determined on a consolidated basis to be less than 1.60 to 1.00 at any time.
(d)
Ratio of EBITDA to Fixed Charges
. The Parent shall not permit the ratio of (i) EBITDA of the Parent and its Subsidiaries determined on a consolidated basis for the four (4) fiscal quarters most recently ending to (ii) Fixed Charges of the Parent and its Subsidiaries determined on a consolidated basis for such period, to be less than 1.50 to 1.00 as of the last day of such period.
(e)
Permitted Investments
. The Parent shall not, and shall not permit the Borrower, any other Loan Party or other Subsidiary to, make an Investment in or otherwise own the following items which would cause the aggregate value of such holdings (for purposes of this Section 10.1. the value of the holdings described in items (i) through (vi) shall be calculated in accordance with GAAP, and the value of the holdings described in item (ii) shall be the lower of cost or market) of such Persons to exceed the following percentages of Total Asset Value at any time:
(i)
Unimproved Land, such that the aggregate book value of all such Unimproved Land exceeds five percent (5%) of Total Asset Value;
(ii)
Common stock, Preferred Stock, other capital stock, beneficial interest in trust, membership interest in limited liability companies and other equity interests in Persons (other than consolidated Subsidiaries and Unconsolidated Affiliates), such that the aggregate value of such interests calculated on the basis of the lower of cost or market, exceeds five percent (5%) of Total Asset Value;
(iii)
Mortgage Receivables, such that the aggregate book value of Indebtedness secured by such Mortgage Receivables exceeds five percent (5%) of Total Asset Value;
(iv)
Investments in Unconsolidated Affiliates of the Borrower or the Parent, such that the aggregate book value of such Investments in Unconsolidated Affiliates exceeds ten percent (10%) of Total Asset Value;
(v)
the aggregate amount of the Total Budgeted Costs for Development Properties in which the Borrower either has a direct or indirect ownership interest shall not exceed fifteen percent (15%) of Total Asset Value. If a Development Property is owned by an Unconsolidated Affiliate of the Borrower or any Subsidiary, then the greater of (1) the product of (A) the Borrower's or such Subsidiary's Ownership Share in such Unconsolidated Affiliate and (B) the amount of the Total Budgeted Costs for such Development Property or (2) the recourse obligations of the Borrower or any Subsidiary relating to the Indebtedness of such Unconsolidated Affiliate, shall be used in calculating such investment limitation;
(vi)
Investments in Properties that are not Retail Properties (other than the real estate located at CBL Center, 2030 Hamilton Place Boulevard, Chattanooga, Tennessee), such that the aggregate value of all such Investments exceeds five percent (5%) of Total Asset Value; and
(vii)
Purchase Money Advances, such that the aggregate book value of all such Purchase Money Advances exceeds five percent (5%) of Total Asset Value.
In addition to the foregoing limitations, the aggregate value of (i), (ii), (iii), (iv), (v), (vi) and (vii) shall not exceed thirty percent (30%) of Total Asset Value.
(f)
Dividends and Other Restricted Payments
. The Parent and the Borrower shall not, and shall not permit any of their Subsidiaries to, declare or make any Restricted Payment; provided, however, that the Parent, the Borrower and their Subsidiaries may declare and make the following Restricted Payments so long as no Default or Event of Default would result therefrom: the Borrower may pay cash dividends to the Parent and other holders of partnership interests in the Borrower with respect to any fiscal year ending during the term of this Agreement to the extent necessary for the Parent to distribute, and the Parent may so distribute, cash dividends to its shareholders in an aggregate amount not to exceed the greater of (i) the amount required to be distributed for the Parent to remain in compliance with Section 8.12. or (ii) ninety-five percent (95%) of Funds From Operations. Notwithstanding the foregoing, but subject to the following sentence, if a Default or Event of Default exists, the Parent may only cause the Borrower (directly or indirectly through any intermediate Subsidiaries) to make cash distributions to the Parent and other holders of partnership interests in the Borrower with respect to any fiscal year ending during the term of this Agreement to the extent necessary for the Parent to distribute, and the Parent may so distribute, cash dividends to its shareholders in an aggregate amount required to be distributed for the Parent to remain in compliance with Section 8.12. Notwithstanding the foregoing, if a Default or Event of Default specified in Section 11.1.(a) resulting from the Borrower's failure to pay when due the
principal of, or interest on, any of the Loans or any Fees, Section 11.1.(e) or (f) shall have occurred and be continuing, or if as a result of the occurrence of any other Event of Default the Obligations have been accelerated pursuant to Section 11.2.(a), the Parent and the Borrower shall not, and shall not permit any other Subsidiary to, make any Restricted Payments whatsoever. Subsidiaries other than the Borrower may make Restricted Payments to the Borrower and the other Subsidiaries at any time.
(g)
Ratio of Unencumbered NOI to Unsecured Interest Expense
. The Parent shall not permit the ratio of (i) Unencumbered NOI for any fiscal quarter to (ii) Unsecured Interest Expense of the Parent and its Subsidiaries determined on a consolidated basis for such fiscal quarter, to be less than 1.75 to 1.00 as of the last day of such fiscal quarter.
(h)
Ratio of Secured Recourse Indebtedness to Total Asset Value
.
The Parent shall not permit the ratio of (i) the sum of all Recourse Indebtedness which is Secured Indebtedness of the Parent and its Subsidiaries determined on a consolidated basis to (ii) Total Asset Value of the Parent and its Subsidiaries determined on a consolidated basis to exceed 0.20 to 1.00 at any time.
(i)
Ratio of Secured Indebtedness to Total Asset Value
.
The Parent shall not permit the ratio of (i) Secured Indebtedness of the Parent and its Subsidiaries determined on a consolidated basis to (ii) Total Asset Value of the Parent and its Subsidiaries determined on a consolidated basis to exceed, at any time, (x) from the Effective Date until December 31, 2013, 0.60 to 1.00 or (y) from January 1, 2014 through the Maturity Date, 0.55 to 1.00.
(j)
Ratio of Adjusted Total Asset Value
. Prior to the occurrence of a Credit Rating Election Event, the Parent shall not permit the ratio of (i) the Adjusted Total Asset Value attributable solely to the Borrower and the Guarantors (other than the Parent) to (ii) the Adjusted Total Asset Value determined on a consolidated basis to be less than 0.90 to 1.00 at any time.
(k)
Ratio of Total Asset Value
. The Parent shall not permit (i) the ratio of (x) the Total Asset Value attributable to the Borrower and its Subsidiaries to (y) the Total Asset Value of the Parent and its Subsidiaries determined on a consolidated basis to be less than 0.98 to 1.00 at any time and (ii) the ratio of (x) the amount of rents and other revenues received in the ordinary course from all Property owned by the Borrower and its Subsidiaries to (y) the amount of rents and other revenues received in the ordinary course from all Property owned by the Parent and its Subsidiaries determined on a consolidated basis (in each case, including proceeds of rent loss or business interruption insurance but excluding pre-paid rents and revenues and security deposits except to the extent applied in satisfaction of tenants' obligations for rent) to be less than 0.98 to 1.00 at any time.
Section 10.2.
Negative Pledge.
(a)
The Borrower shall not, and shall not permit any other Loan Party or Subsidiary (other than an Excluded Subsidiary of the type described in clause (a) of the definition of “Excluded Subsidiary”) to, (i) create, assume, incur, permit or suffer to exist any Lien on any of its properties, assets, income or profits of any character whether now owned or hereafter acquired, except for Permitted Liens or (ii) permit any of its properties, assets, income or profits or any direct or indirect ownership interest of the Borrower or in any Person owning any properties, assets, income or profits, to be subject to a Negative Pledge (other than the Negative Pledge under this Agreement).
(b)
The Borrower shall not, and shall not permit any Excluded Subsidiary to, (i) create, assume, incur, permit or suffer to exist any Lien on any Equity Interests of any Subsidiary of the Borrower holding title to any Eligible Property or any other asset the value of which is included in the
determination of Unencumbered Asset Value or the Equity Interests of any Subsidiary of the Borrower that owns, directly or indirectly any Equity Interests in any Subsidiary of the Borrower holding title to any Eligible Property or any other asset the value of which is included in the determination of Unencumbered Asset Value (all such Equity Interests under this clause (i) being “Specified Equity Interests”), except for Permitted Liens described in clause (f) of the definition of that term or (ii) permit any Specified Equity Interests to be subject to a Negative Pledge (other than the Negative Pledge under this Agreement).
Section 10.3.
Restrictions on Intercompany Transfers.
The Borrower shall not, and shall not permit any other Loan Party or any other Subsidiaries (other than an Excluded Subsidiary of the type described in clause (a) of the definition of “Excluded Subsidiary”) to, create or otherwise cause or suffer to exist or become effective any consensual encumbrance or restriction of any kind on the ability of any Subsidiary to: (a) pay dividends or make any other distribution on any of such Subsidiary's capital stock or other equity interests owned by the Borrower or any other Subsidiary; (b) pay any Indebtedness owed to the Borrower or any other Subsidiary; (c) make loans or advances to the Borrower or any other Subsidiary; or (d) transfer any of its property or assets to the Borrower or any other Subsidiary; other than (i) with respect to clauses (a) - (d) those encumbrances or restrictions contained in any Loan Document or, (ii) with respect to clause (d), customary provisions restricting assignment of any agreement entered into by the Borrower, any other Loan Party or any Subsidiary in the ordinary course of business.
Section 10.4.
Merger, Consolidation, Sales of Assets and Other Arrangements.
Without the prior written consent of the Requisite Lenders, such consent not to be unreasonably withheld, the Parent and the Borrower shall not, and shall not permit any other Loan Party or any other Subsidiary to, (a) enter into any transaction of merger or consolidation; (b) liquidate, windup or dissolve itself (or suffer any liquidation or dissolution); (c) convey, sell, lease, sublease, transfer or otherwise dispose of, in one transaction or a series of transactions, all or any substantial part of its business or assets, or the capital stock of or other Equity Interests in any of its Subsidiaries, whether now owned or hereafter acquired; or (d) acquire the assets of, or make an Investment in, any other Person involving consideration, or value, in excess of fifteen percent (15%) of Total Asset Value for the quarter most recently ended as reported on the Compliance Certificate for such quarter; provided, however, that:
(i)
any Subsidiary may merge with a Loan Party so long as such Loan Party is the survivor;
(ii)
any Subsidiary may sell, transfer or dispose of its assets to a Loan Party;
(iii)
a Loan Party (other than the Borrower) and any Subsidiary that is not (and is not required to be) a Loan Party may convey, sell, transfer or otherwise dispose of, in one transaction or a series of transactions, all or any substantial part of its business or assets, or the capital stock of or other Equity Interests in any of its Subsidiaries, and immediately thereafter liquidate, provided that immediately prior to any such conveyance, sale, transfer, disposition or liquidation and immediately thereafter and after giving effect thereto, no Default or Event of Default is or would be in existence;
(iv)
any Loan Party and any other Subsidiary may, directly or indirectly, (A) acquire (whether by purchase, acquisition of Equity Interests of a Person, or as a result of a merger or consolidation) the assets of, or make an Investment in, any other Person in excess of
fifteen percent (15%) of Total Asset Value for the quarter most recently ended as reported on the Compliance Certificate for such quarter, and (B) sell, lease or otherwise transfer, whether by one or a series of transactions, assets (including capital stock or other securities of Subsidiaries) in excess of fifteen percent (15%) of Total Asset Value for the quarter most recently ended as reported on the Compliance Certificate for such quarter to any other Person, so long as, in each case, (1) the Borrower shall have given the Administrative Agent and the Lenders at least thirty (30) days prior written notice of such consolidation, merger, acquisition, Investment, sale, lease or other transfer, together with all information related to such consolidation, merger, acquisition, Investment, sale, lease or transfer as Administrative Agent may reasonably request; (2) immediately prior thereto, and immediately thereafter and after giving effect thereto, no Default or Event of Default is or would be in existence, including, without limitation, a Default or Event of Default resulting from a breach of Section 10.1.; (3) in the case of a consolidation or merger involving the Borrower or a Loan Party which owns an Eligible Property, such Person shall be the survivor thereof; (4) at the time the Borrower gives notice pursuant to clause (1) of this subsection, the Borrower shall have delivered to the Administrative Agent for distribution to each of the Lenders a Compliance Certificate, calculated on a pro forma basis, evidencing the continued compliance by the Loan Parties with the terms and conditions of this Agreement and the other Loan Documents, including without limitation, the financial covenants contained in Section 10.1., after giving effect to such consolidation, merger, acquisition, Investment, sale, lease or other transfer; and (5)(A) with respect to any such acquisition or Investment involving consideration, or valued, in excess of fifteen percent (15%), but less than twenty-five percent (25%), of Total Asset Value for the quarter most recently ended as reported on the Compliance Certificate for such quarter, Administrative Agent has consented thereto or (B) with respect to any such acquisition or Investment involving consideration, or valued, in excess of twenty-five percent (25%) of Total Asset Value for the quarter most recently ended as reported on the Compliance Certificate for such quarter, Requisite Lenders have consented thereto; and
(v)
the Loan Parties may lease and sublease their respective assets, as lessor or sublessor (as the case may be), in the ordinary course of their business.
Further, no Loan Party shall enter into any sale‑leaseback transactions or other transaction by which such Person shall remain liable as lessee (or the economic equivalent thereof) of any real or personal property that it has sold or leased to another Person.
Section 10.5.
Plans.
The Borrower shall not, and shall not permit the Parent or any Subsidiary to, permit any of its respective assets to become or be deemed to be “plan assets” within the meaning of ERISA or the Internal Revenue Code and the respective regulations promulgated thereunder for purposes of ERISA and the Internal Revenue Code.
Section 10.6.
Fiscal Year.
The Parent and the Borrower shall not, and shall not permit any other Loan Party or other Subsidiary to, change its fiscal year from that in effect as of the Agreement Date.
Section 10.7.
Modifications of Organizational Documents and Material Contracts.
The Parent and the Borrower shall not, and shall not permit any other Loan Party or any other Subsidiary to, amend, supplement, restate or otherwise modify its certificate or articles of incorporation or
formation, by-laws, operating agreement, declaration of trust, partnership agreement or other applicable organizational document if such amendment, supplement, restatement or other modification (a) is adverse to the interest of the Administrative Agent, the Issuing Bank or the Lenders or (b) could reasonably be expected to have a Material Adverse Effect. The Borrower shall not enter into, and shall not permit any other Loan Party or any Subsidiary to enter into, any amendment or modification to any Material Contract which could reasonably be expected to have a Material Adverse Effect or default in the performance of any obligations of any other Loan Party or any Subsidiary in any Material Contract or permit any Material Contract to be canceled or terminated prior to its stated maturity.
|
|
Section 10.8.
|
Subordinated Debt Prepayments; Amendments.
|
The Borrower shall not, and shall not permit any other Loan Party to, prepay any principal of, or accrued interest on, any Subordinated Debt or otherwise make any voluntary or optional payment with respect to any principal of, or accrued interest on, any Subordinated Debt prior to the originally scheduled maturity date thereof or otherwise redeem or acquire for value any Subordinated Debt. Further, the Borrower shall not, and shall not permit any other Loan Party to, amend or modify, or permit the amendment or modification of, any agreement or instrument evidencing any Subordinated Debt where such amendment or modification provides for the following or which has any of the following effects:
(a)
increases the rate of interest accruing on such Subordinated Debt;
(b)
increases the amount of any scheduled installment of principal or interest, or shortens the date on which any such installment or principal or interest becomes due;
(c)
shortens the final maturity date of such Subordinated Debt;
(d)
increases the principal amount of such Subordinated Debt;
(e)
amends any financial or other covenant contained in any document or instrument evidencing any Subordinated Debt in a manner which is more onerous to the Borrower or which requires the Borrower to improve its financial performance;
(f)
provides for the payment of additional fees or the increase in existing fees; and/or
(g)
otherwise could reasonably be expected to be adverse to the interests of the Administrative Agent or the Lenders.
Section 10.9.
Transactions with Affiliates.
The Borrower shall not permit to exist or enter into, and will not permit any Loan Party or other Subsidiary 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 of any Loan Party or any Subsidiary, except (a) as set forth on
Schedule 7.1.(r)
, or (b) transactions in the ordinary course of and pursuant to the reasonable requirements of the business of the Borrower, any of its Subsidiaries, or any Loan Party and upon fair and reasonable terms which are no less favorable to the Borrower, such Subsidiary, or any Loan Party than would be obtained in a comparable arm's length transaction with a Person that is not an Affiliate (which shall include but not be limited to Property Management Agreements). Notwithstanding the forgoing, no payments may be made with respect to any items set forth on such
Schedule 7.1.(r)
if a Default or Event of Default exists or would result therefrom.
Section 10.10.
Environmental Matters.
The Borrower shall not, and shall not permit Parent, any other Loan Party or other Subsidiary or any other Person to, use, generate, discharge, emit, manufacture, handle, process, store, release, transport, remove, dispose of or clean up any Hazardous Materials on, under or from the Properties in material violation of any Environmental Law or in a manner that could reasonably be expected to lead to any material environmental claim or pose a material risk to human health, safety or the environment. Nothing in this Section shall impose any obligation or liability whatsoever on the Administrative Agent or any Lender.
Section 10.11.
Derivatives Contracts.
The Borrower shall not, and shall not permit Parent or any other Loan Party to enter into or become obligated in respect of, Derivatives Contracts, other than (a) Specified Derivatives Contracts or (b) Derivatives Contracts entered into by the Parent, the Borrower or a Loan Party in the ordinary course of business and which establish an effective hedge in respect of liabilities, commitments or assets held or reasonably anticipated by the Parent, the Borrower or a Loan Party (including, without limitation, liabilities under this Agreement).
Article XI. Default
Section 11.1.
Events of Default.
Each of the following shall constitute an Event of Default, whatever the reason for such event and whether it shall be voluntary or involuntary or be effected by operation of Applicable Law or pursuant to any judgment or order of any Governmental Authority:
(a)
Default in Payment
. The Borrower shall fail to pay when due under this Agreement or any other Loan Document (whether upon demand, at maturity, by reason of acceleration or otherwise) the principal of, or any accrued interest on, any of the Loans or any Reimbursement Obligation, or shall fail to pay any of the other payment Obligations owing by the Borrower under this Agreement, any other Loan Document or the Fee Letter, or any other Loan Party shall fail to pay when due any payment obligation owing by such Loan Party under any Loan Document to which it is a party, and, solely in the case of interest or any other payment Obligation (other than principal of any Loan), such failure continues for a period of ten (10) days after the date the Administrative Agent gives the Borrower notice of such failure.
(b)
Default in Performance
.
(i)
Any Loan Party or the Parent shall fail to perform or observe any term, covenant, condition or agreement on its part to be performed or observed and contained in Section 8.1., Section 8.8., Section 8.12., Section 9.4.(g)(i), or Article X; or
(ii)
Any Loan Party or the Parent shall fail to perform or observe any term, covenant, condition or agreement on its part to be performed or observed and contained Section 8.14 or Article IX (other than Section 9.4.(g)(i)) and such failure shall continue for a period of five (5) Business Days; or
(iii)
Any Loan Party or the Parent shall fail to perform or observe any other term, covenant, condition or agreement contained in this Agreement or any other Loan Document
to which it is a party and not otherwise mentioned in this Section and such failure shall continue for a period of thirty (30)
calendar days after the earlier of (x) the date upon which any Senior Officer of the Borrower has actual knowledge of such failure or (y) the date upon which the Borrower has received written notice of such failure from the Administrative Agent.
(c)
Misrepresentations
. Any written statement, representation or warranty made or deemed made by or on behalf of any Loan Party or the Parent under this Agreement or under any other Loan Document, or any amendment hereto or thereto, or in any other writing or statement at any time furnished by, or at the direction of, any Loan Party or the Parent to the Administrative Agent, the Issuing Bank or any Lender under or in connection with this Agreement or any other Loan Documents, shall at any time prove to have been incorrect or misleading in any material respect when furnished or made or deemed made.
(d)
Cross-Default
.
(i)
Any of the Borrower, Parent, any other Loan Party or any Subsidiary shall fail to make any payment when due and payable (subject to any notice and after giving effect to any applicable grace or cure period) in respect of any Recourse Indebtedness or Non-Recourse Indebtedness (other than the Loans and Reimbursement Obligations) having an outstanding principal amount (or, in the case of any Derivatives Contract, having, without regard to the effect of any close-out netting provision, a Derivatives Termination Value) (x) in the case of Recourse Indebtedness, equal to or greater than $50,000,000 for any such Recourse Indebtedness and (y) in the case of Non-Recourse Indebtedness, equal to or greater than $150,000,000 for any such Person's Ownership Share of such Non-Recourse Indebtedness (in the case of each of clause (x) and (y), “Material Indebtedness”); or
(ii)
The maturity of any Material Indebtedness shall have been accelerated in accordance with the provisions of any indenture, contract or instrument evidencing, providing for the creation of or otherwise concerning such Material Indebtedness; or
(iii)
Any Material Indebtedness shall have been required to be prepaid or repurchased prior to the stated maturity thereof; or
(iv)
Any other event shall have occurred and be continuing which, with or without the passage of time, the giving of notice, or otherwise, would permit any holder of Material Indebtedness, any trustee or agent acting on behalf of such holder or holders or any other Person, to accelerate the maturity of any such Material Indebtedness or require any such Material Indebtedness to be prepaid or repurchased prior to its stated maturity; or
(v)
There occurs an “Event of Default” under and as defined in any Specified Derivatives Contract as to which the Parent, the Borrower, any Loan Party or any Subsidiary is a “Defaulting Party” (as defined therein), or there occurs an “Early Termination Date” (as defined therein) in respect of any Specified Derivatives Contract as a result of a “Termination Event” (as defined therein) as to which the Parent, the Borrower or any Subsidiary is an “Affected Party” (as defined therein).
(e)
Voluntary Bankruptcy Proceeding
. The Borrower, the Parent, any Loan Party or any other Significant Subsidiary shall: (i) commence a voluntary case under the Bankruptcy Code or other federal bankruptcy laws (as now or hereafter in effect); (ii) file a petition seeking to take advantage of any other Applicable Laws, domestic or foreign, relating to bankruptcy, insolvency, reorganization,
winding-up, or composition or adjustment of debts; (iii) consent to, or fail to contest in a timely and appropriate manner, any petition filed against it in an involuntary case under such bankruptcy laws or other Applicable Laws or consent to any proceeding or action described in the immediately following subsection (f); (iv) apply for or consent to, or fail to contest in a timely and appropriate manner, the appointment of, or the taking of possession by, a receiver, custodian, trustee, or liquidator of itself or of a substantial part of its property, domestic or foreign; (v) admit in writing its inability to pay its debts as they become due; (vi) make a general assignment for the benefit of creditors; (vii) make a conveyance fraudulent as to creditors under any Applicable Law; or (viii) take any corporate, partnership or similar action for the purpose of effecting any of the foregoing.
(f)
Involuntary Bankruptcy Proceeding
. A case or other proceeding shall be commenced against the Borrower, the Parent, any Loan Party or any other Significant Subsidiary in any court of competent jurisdiction seeking: (i) relief under the Bankruptcy Code or other federal bankruptcy laws (as now or hereafter in effect) or under any other Applicable Laws, domestic or foreign, relating to bankruptcy, insolvency, reorganization, winding‑up, or composition or adjustment of debts; or (ii) the appointment of a trustee, receiver, custodian, liquidator or the like of such Person, or of all or any substantial part of the assets, domestic or foreign, of such Person, and in the case of either clause (i) or (ii) such case or proceeding shall continue undismissed or unstayed for a period of ninety (90) consecutive calendar days, or an order granting the relief requested in such case or proceeding (including, but not limited to, an order for relief under such Bankruptcy Code or such other federal bankruptcy laws) shall be entered.
(g)
Revocation of Loan Documents
. Any Loan Party or the Parent shall (or shall attempt to) disavow, revoke or terminate any Loan Document to which it is a party or the Fee Letter or shall otherwise challenge or contest in any action, suit or proceeding in any court or before any Governmental Authority the validity or enforceability of any Loan Document or the Fee Letter or any Loan Document or the Fee Letter shall cease to be in full force and effect (except as a result of the express terms thereof).
(h)
Judgment
. A judgment or order for the payment of money or for an injunction or other non-monetary relief shall be entered against the Borrower, any other Loan Party, the Parent, or any Subsidiary by any court or other tribunal and (i) such judgment or order shall continue for a period of thirty (30) days without being paid, stayed, dismissed through appropriate appellate proceedings or otherwise bonded and (ii) either (A) the amount of such judgment or order for which insurance has not been acknowledged in writing by the applicable insurance carrier (or the amount as to which the insurer has denied liability) exceeds, individually or together with all other such judgments or orders entered against the Parent, the Loan Parties and Subsidiaries, $50,000,000, or (B) in the case of an injunction or other non-monetary relief, such judgment or order could reasonably be expected to have a Material Adverse Effect.
(i)
Attachment
. A warrant, writ of attachment, execution or similar process shall be issued against any property of the Borrower, the Parent, any Loan Party or any Subsidiary, which exceeds, individually or together with all other such warrants, writs, executions and processes, $50,000,000 and such warrant, writ, execution or process shall not be paid, discharged, vacated, stayed or bonded for a period of sixty (60) days; provided, however, that if a bond has been issued in favor of the claimant or other Person obtaining such warrant, writ, execution or process, the issuer of such bond shall execute a waiver or subordination agreement in form and substance satisfactory to the Administrative Agent pursuant to which the issuer of such bond subordinates its right of reimbursement, contribution or subrogation to the Obligations and waives or subordinates any Lien it may have on the assets of the Borrower, any Loan Party, any Subsidiary or the Parent.
(j)
ERISA
. Any member of the ERISA Group or Management Company shall fail to pay when due an amount or amounts which it shall have become liable to pay under Title IV of ERISA; or notice of intent to terminate a Material Plan shall be filed under Title IV of ERISA by any member of the ERISA Group or Management Company any plan administrator or any combination of the foregoing; or the PBGC shall institute proceedings under Title IV of ERISA to terminate, to impose liability (other than for premiums under Section 4007 of ERISA) in respect of, or to cause a trustee to be appointed to administer any Material Plan; or a condition shall exist by reason of which the PBGC would be entitled to obtain a decree adjudicating that any Material Plan must be terminated; or there shall occur a complete or partial withdrawal from, or a default, within the meaning of Section 4219(c)(5) of ERISA, with respect to, one or more Multiemployer Plans which could cause one or more members of the ERISA Group or Management Company to incur withdrawal liability or a current payment obligation; and such failure, action, event or occurrence could reasonably be expected to have a Material Adverse Effect.
(k)
Loan Documents
. An Event of Default (as defined therein) shall occur under any of the other Loan Documents.
(l)
Change of Control/Change in Management
.
(i)
Any “person” or “group” (as such terms are used in Sections 13(d) and 14(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)), is or becomes the “beneficial owner” (as defined in Rules 13d-3 and 13d-5 under the Exchange Act, except that a Person will be deemed to have “beneficial ownership” of all securities that such Person has the right to acquire, whether such right is exercisable immediately or only after the passage of time), directly or indirectly, of more than thirty-five percent (35%) of the total voting power of the then outstanding voting stock of the Parent entitled to vote for the election of directors (“Parent Voting Stock”);
provided
,
however
, this clause shall not apply to any Parent Voting Stock acquired after the date hereof by a Person as a result of the conversion of limited partnership interests in the Borrower into Parent Voting Stock in accordance with Borrower's partnership agreement;
provided further
, however, this clause shall not apply to any Parent Voting Stock acquired after the date hereof by Borrower, the Principals, or any combination thereof, as a result of purchases of Parent Voting Stock by Borrower or the Principals or as a result of the conversion of limited partnership interests in the Borrower into Parent Voting Stock in accordance with Borrower's partnership agreement;
(ii)
during any twelve‑month period (whether before or after the Agreement Date), individuals who at the beginning of such period were directors of the Parent (together with any new directors whose election by such board of directors or election by the shareholders of the Parent was approved by a vote of a majority of the directors then still in office who were either directors at the beginning of such period or whose election or nomination for election was previously so approved but excluding any director whose initial nomination for, or assumption of office as, a director occurs as a result of an actual or threatened solicitation of proxies or consents for the election or removal of one or more directors by any Person or group other than a solicitation for the election of one or more directors by or on behalf of the board of directors) shall cease for any reason (other than death or mental or physical disability) to constitute a majority of the board of directors of the Parent;
(iii)
the general partner of the Borrower shall cease to be a Wholly Owned Subsidiary of the Parent or the Parent shall cease to have the sole and exclusive power to exercise all management and control over the Borrower; or
(iv)
the Parent shall cease to beneficially own, directly or indirectly, at least sixty-five percent (65%) of the outstanding Equity Interests of the Borrower.
(m)
Damage; Strike; Casualty
. Any strike, lockout, labor dispute, embargo, condemnation, act of God or public enemy, or other casualty which causes, for more than thirty (30) consecutive days beyond the coverage period of any applicable business interruption insurance, the cessation or substantial curtailment of revenue producing activities of the Borrower or any other Loan Party taken as a whole and only if any such event or circumstance could reasonably be expected to have a Material Adverse Effect. Notwithstanding the foregoing, no Event of Default shall exist if within thirty (30) days of the occurrence of any such event or circumstance described in the preceding sentence, Borrower delivers to the Administrative Agent for prompt distribution to each Lender a written plan acceptable to all of the Lenders to eliminate such event or circumstance. If such event or circumstance is not eliminated within ninety (90) days of the occurrence of such event or circumstance, an Event of Default shall be deemed to have occurred hereunder.
(n)
Subordinated Debt Documents
. The failure of the Parent or any Loan Party to comply with the terms of any intercreditor agreement or any subordination provisions of any note or other document running to the benefit of the Administrative Agent or Lenders, or if any such document becomes null and void or unenforceable against any lender holding the Subordinated Debt.
Section 11.2.
Remedies Upon Event of Default.
Upon the occurrence of an Event of Default the following provisions shall apply:
(a)
Acceleration; Termination of Facilities
.
(i)
Automatic
. Upon the occurrence of an Event of Default specified in Sections 11.1.(e) or 11.1.(f), (1)(A) the principal of, and all accrued interest on, the Loans and the Notes at the time outstanding, (B) an amount equal to the Stated Amount of all Letters of Credit outstanding as of the date of the occurrence of such Event of Default for deposit into the Letter of Credit Collateral Account and (C) all of the other Obligations, including, but not limited to, the other amounts owed to the Lenders and the Administrative Agent under this Agreement, the Notes or any of the other Loan Documents shall become immediately and automatically due and payable without presentment, demand, protest, or other notice of any kind, all of which are expressly waived by the Borrower on behalf of itself and the other Loan Parties, and (2) the Commitments and the Swingline Commitment and the obligation of the Issuing Bank to issue Letters of Credit hereunder shall all immediately and automatically terminate.
(ii)
Optional
. If any other Event of Default shall exist, the Administrative Agent may, and at the direction of the Requisite Lenders shall: (1) declare (A) the principal of, and accrued interest on, the Loans and the Notes at the time outstanding, (B) an amount equal to the Stated Amount of all Letters of Credit outstanding as of the date of the occurrence of such Event of Default for deposit into the Letter of Credit Collateral Account, and (C) all of the other Obligations, including, but not limited to, the other amounts owed to the Lenders and the Administrative Agent under this Agreement, the Notes or any of the other Loan Documents to be forthwith due and payable, whereupon the same shall immediately become due and payable without presentment, demand, protest or other notice of any kind, all of which are expressly waived by the Borrower on behalf of itself and the other Loan Parties, and (2) terminate the Commitments and the Swingline Commitment and the obligation of the Issuing Bank to issue Letters of Credit hereunder.
(b)
Loan Documents
. The Requisite Lenders may direct the Administrative Agent to, and the Administrative Agent if so directed shall, exercise any and all of its rights under any and all of the other Loan Documents.
(c)
Applicable Law
. The Requisite Lenders may direct the Administrative Agent to, and the Administrative Agent if so directed shall, exercise all other rights and remedies it may have under any Applicable Law.
(d)
Appointment of Receiver
. To the extent permitted by Applicable Law, the Administrative Agent and the Lenders shall be entitled to the appointment of a receiver for the assets and properties of the Parent, the Borrower and the Subsidiaries of the Parent, without notice of any kind whatsoever and without regard to the adequacy of any security for the Obligations or the solvency of any party bound for its payment, to take possession of all or any portion of the property and/or the business operations of the Borrower, the Parent and their Subsidiaries related thereto and to exercise such power as the court shall confer upon such receiver.
(e)
Specified Derivatives Contract Remedies
. Notwithstanding any other provision of this Agreement or other Loan Document, each Specified Derivatives Provider shall have the right, with the prompt notice to the Administrative Agent, but without the approval or consent of or other action by the Administrative Agent or the Lenders, and without limitation of other remedies available to such Specified Derivatives Provider under contract or Applicable Law, to undertake any of the following: (a) to declare an event of default, termination event or other similar event under any Specified Derivatives Contract and to create an “Early Termination Date” (as defined therein) in respect thereof, (b) to determine net termination amounts in respect of any and all Specified Derivatives Contracts in accordance with the terms thereof, and to set off amounts among such contracts, (c) to set off or proceed against deposit account balances, securities account balances and other property and amounts held by such Specified Derivatives Provider pursuant to any Derivatives Support Document, including any “Posted Collateral” (as defined in any credit support annex including in any such Derivatives Support Document to which such Specified Derivatives Provider may be a party), and (d) to prosecute any legal action against the Borrower, the Parent, any Loan Party or other Subsidiary to enforce or collect net amounts owing to such Specified Derivatives Provider pursuant to any Specified Derivatives Contract.
Section 11.3.
Remedies Upon Default.
Upon the occurrence of a Default specified in Section 11.1.(f), the Commitments shall immediately and automatically terminate.
Section 11.4.
Marshaling; Payments Set Aside.
None of the Administrative Agent, the Issuing Bank, any Lender or any Specified Derivatives Provider shall be under any obligation to marshal any assets in favor of any Loan Party or any other party or against or in payment of any or all of the Obligations or the Specified Derivatives Obligations. To the extent that any Loan Party makes a payment or payments to the Administrative Agent and/or the Issuing Bank and/or any Lender and/or any Specified Derivatives Provider, or the Administrative Agent and/or the Issuing Bank and/or any Lender and/or any Specified Derivatives Provider enforce their security interests or exercise their rights of setoff, and such payment or payments or the proceeds of such enforcement or setoff or any part thereof are subsequently invalidated, declared to be fraudulent or preferential, set aside and/or required to be repaid to a trustee, receiver or any other party under any bankruptcy law, state or federal law, common law or equitable cause, then to the extent of such recovery, the Obligations or Specified Derivatives Obligations, or part thereof originally intended to be satisfied,
and all Liens, rights and remedies therefor, shall be revived and continued in full force and effect as if such payment had not been made or such enforcement or setoff had not occurred.
Section 11.5.
Allocation of Proceeds.
If an Event of Default exists and maturity of any of the Obligations has been accelerated or the Maturity Date has occurred, all payments received by the Administrative Agent under any of the Loan Documents, in respect of any principal of or interest on the Obligations or any other amounts payable by the Borrower, the Parent or any other Loan Party hereunder or thereunder, shall be applied in the following order and priority:
(a)
amounts due to the Administrative Agent, the Issuing Bank and the Lenders in respect of expenses due under Section 13.2. until paid in full, and then Fees;
(b)
payments of interest on all Loans, including Swingline Loans;
(c)
payments of principal of all Loans, including Swingline Loans, to be applied for the ratable benefit of the Lenders in such order as the Lenders may determine in their sole discretion;
(d)
amounts to be deposited into the Letter of Credit Collateral Account in respect of Letters of Credit;
(e)
amounts due to the Administrative Agent and the Lenders pursuant to Sections 12.8. and 13.10.;
(f)
payments of all other amounts due under any of the Loan Documents, if any, to be applied for the ratable benefit of the Lenders; and
(g)
any amount remaining after application as provided above, shall be paid to the Borrower or whoever else may be legally entitled thereto.
Section 11.6.
Letter of Credit Collateral Account.
(a)
As collateral security for the prompt payment in full when due of all Letter of Credit Liabilities and the other Obligations, the Borrower hereby pledges and grants to the Administrative Agent, for the ratable benefit of the Administrative Agent, the Issuing Bank and the Lenders as provided herein, a security interest in all of its right, title and interest in and to the Letter of Credit Collateral Account established pursuant to the requirements of Section 2.14. and the balances from time to time in the Letter of Credit Collateral Account (including the investments and reinvestments therein provided for below). The balances from time to time in the Letter of Credit Collateral Account shall not constitute payment of any Letter of Credit Liabilities until applied by the Administrative Agent as provided herein. Anything in this Agreement to the contrary notwithstanding, funds held in the Letter of Credit Collateral Account shall be subject to withdrawal only as provided in this Section and in Section 2.14.
(b)
Amounts on deposit in the Letter of Credit Collateral Account shall be invested and prudently reinvested by the Administrative Agent in such Cash Equivalents as the Administrative Agent shall determine in its sole discretion. All such investments and reinvestments shall be held in the name of and be under the sole dominion and control of the Administrative Agent for the ratable benefit of the Administrative Agent, the Issuing Bank and the Lenders, provided, that all earnings on such investments will be credited to and retained in the Letter of Credit Collateral Account. The Administrative Agent
shall exercise reasonable care in the custody and preservation of any funds held in the Letter of Credit Collateral Account and shall be deemed to have exercised such care if such funds are accorded treatment substantially equivalent to that which the Administrative Agent accords other funds deposited with the Administrative Agent, it being understood that the Administrative Agent shall not have any responsibility for taking any necessary steps to preserve rights against any parties with respect to any funds held in the Letter of Credit Collateral Account.
(c)
If a drawing pursuant to any Letter of Credit occurs on or prior to the expiration date of such Letter of Credit, the Borrower and the Lenders authorize the Administrative Agent to use the monies deposited in the Letter of Credit Collateral Account to reimburse the Issuing Bank for the payment made by the Issuing Bank to the beneficiary with respect to such drawing or the payee with respect to such presentment.
(d)
If an Event of Default exists, the Administrative Agent may (and, if instructed by the Requisite Lenders, shall) in its (or their) discretion at any time and from time to time elect to liquidate any such investments and reinvestments and credit the proceeds thereof to the Letter of Credit Collateral Account and apply or cause to be applied such proceeds and any other balances in the Letter of Credit Collateral Account to the payment of any of the Letter of Credit Liabilities due and payable.
(e)
So long as no Default or Event of Default exists, the Administrative Agent shall, from time to time, at the request of the Borrower, deliver to the Borrower, against receipt but without any recourse, warranty or representation whatsoever, such of the balances in the Letter of Credit Collateral Account as exceed the aggregate amount of Letter of Credit Liabilities at such time. When all of the Obligations shall have been indefeasibly paid in full and no Letters of Credit remain outstanding, the Administrative Agent shall deliver to the Borrower, against receipt but without any recourse, warranty or representation whatsoever, the balances remaining in the Letter of Credit Collateral Account.
(f)
The Borrower shall pay to the Administrative Agent from time to time such reasonable fees as the Administrative Agent normally charges for similar services in connection with the Administrative Agent's administration of the Letter of Credit Collateral Account and investments and reinvestments of funds therein.
Section 11.7.
Reserved.
Section 11.8.
Performance by Administrative Agent.
If the Borrower or any other Loan Party shall fail to perform any covenant, duty or agreement contained in any of the Loan Documents, the Administrative Agent may, but shall not be obligated to, perform or attempt to perform such covenant, duty or agreement on behalf of the Borrower or such other Loan Party after the expiration of any cure or grace periods set forth herein. In such event, the Borrower shall, at the request of the Administrative Agent, promptly pay any amount reasonably expended by the Administrative Agent in such performance or attempted performance to the Administrative Agent, together with interest thereon at the applicable Post-Default Rate from the date of such expenditure until paid. Notwithstanding the foregoing, neither the Administrative Agent nor any Lender shall have any liability or responsibility whatsoever for the performance of any obligation of the Borrower under this Agreement or any other Loan Document.
Section 11.9.
Rights Cumulative.
The rights and remedies of the Administrative Agent, the Issuing Bank, the Lenders and the Specified Derivatives Providers under this Agreement, each of the other Loan Documents, the Fee Letter and Specified Derivatives Contracts shall be cumulative and not exclusive of any rights or remedies which any of them may otherwise have under Applicable Law. In exercising their respective rights and remedies the Administrative Agent, the Issuing Bank, the Lenders and the Specified Derivatives Providers may be selective and no failure or delay by the Administrative Agent, the Issuing Bank, any of the Lenders or any of the Specified Derivatives Providers in exercising any right shall operate as a waiver of it, nor shall any single or partial exercise of any power or right preclude its other or further exercise or the exercise of any other power or right.
Article XII. The Administrative Agent
Section 12.1.
Appointment and Authorization.
Each Lender hereby irrevocably appoints and authorizes the Administrative Agent to take such action as contractual representative on such Lender's behalf and to exercise such powers under this Agreement and the other Loan Documents as are specifically delegated to the Administrative Agent by the terms hereof and thereof, together with such powers as are reasonably incidental thereto. Not in limitation of the foregoing, each Lender authorizes and directs the Administrative Agent to enter into the Loan Documents for the benefit of the Lenders. Each Lender hereby agrees that, except as otherwise set forth herein, any action taken by the Requisite Lenders in accordance with the provisions of this Agreement or the Loan Documents, and the exercise by the Requisite Lenders of the powers set forth herein or therein, together with such other powers as are reasonably incidental thereto, shall be authorized and binding upon all of the Lenders. Nothing herein shall be construed to deem the Administrative Agent a trustee or fiduciary for any Lender or to impose on the Administrative Agent duties or obligations other than those expressly provided for herein. Without limiting the generality of the foregoing, the use of the terms “Agent”, “Administrative Agent”, “agent” and similar terms in the Loan Documents with reference to the Administrative Agent is not intended to connote any fiduciary or other implied (or express) obligations arising under agency doctrine of any Applicable Law. Instead, use of such terms is merely a matter of market custom, and is intended to create or reflect only an administrative relationship between independent contracting parties. The Administrative Agent shall deliver to each Lender, promptly upon receipt thereof by the Administrative Agent, copies of each of the financial statements, certificates, notices and other documents delivered to the Administrative Agent pursuant to Article IX. that the Borrower is not otherwise required to deliver directly to the Lenders. The Administrative Agent will furnish to any Lender, upon the request of such Lender, a copy (or, where appropriate, an original) of any document, instrument, agreement, certificate or notice furnished to the Administrative Agent by the Parent, the Borrower, any Loan Party or any other Affiliate of the Borrower, pursuant to this Agreement or any other Loan Document not already delivered to such Lender pursuant to the terms of this Agreement or any such other Loan Document. As to any matters not expressly provided for by the Loan Documents (including, without limitation, enforcement or collection of any of the Obligations), the Administrative Agent shall not be required to exercise any discretion or take any action, but shall be required to act or to refrain from acting (and shall be fully protected in so acting or refraining from acting) upon the instructions of the Requisite Lenders (or all of the Lenders if explicitly required under any other provision of this Agreement), and such instructions shall be binding upon all Lenders and all holders of any of the Obligations; provided, however, that, notwithstanding anything in this Agreement to the contrary, the Administrative Agent shall not be required to take any action which exposes the Administrative Agent to personal liability or which is contrary to this Agreement or any other Loan Document or Applicable Law. Not in limitation of the foregoing, the Administrative Agent may exercise any right or remedy it or the Lenders may have under any Loan Document upon the occurrence of a
Default or an Event of Default unless the Requisite Lenders have directed the Administrative Agent otherwise. Without limiting the foregoing, no Lender shall have any right of action whatsoever against the Administrative Agent as a result of the Administrative Agent acting or refraining from acting under this Agreement or any of the other Loan Documents in accordance with the instructions of the Requisite Lenders, or where applicable, all the Lenders.
Section 12.2.
Wells Fargo as Lender.
Wells Fargo, as a Lender or as a Specified Derivatives Provider, as the case may be, shall have the same rights and powers under this Agreement and any other Loan Document and under any Specified Derivatives Contract, as the case may be, as any other Lender or Specified Derivatives Provider and may exercise the same as though it were not the Administrative Agent; and the term “Lender” or “Lenders” shall, unless otherwise expressly indicated, include Wells Fargo in each case in its individual capacity. Wells Fargo and its affiliates may each accept deposits from, maintain deposits or credit balances for, invest in, lend money to, act as trustee under indentures of, serve as financial advisor to, and generally engage in any kind of business with the Borrower, any other Loan Party, the Parent or any other affiliate thereof as if it were any other bank and without any duty to account therefor to the Issuing Bank, other Lenders, or any other Specified Derivatives Providers. Further, the Administrative Agent and any affiliate may accept fees and other consideration from the Borrower for services in connection with this Agreement or any Specified Derivatives Contract, or otherwise without having to account for the same to the Issuing Bank, the other Lenders or any other Specified Derivatives Providers. The Issuing Bank and the Lenders acknowledge that, pursuant to such activities, Wells Fargo or its affiliates may receive information regarding the Parent, the Borrower, other Loan Parties, other Subsidiaries and other Affiliates (including information that may be subject to confidentiality obligations in favor of such Person) and acknowledge that the Administrative Agent shall be under no obligation to provide such information to them.
Section 12.3.
Approvals of Lenders.
All communications from the Administrative Agent to any Lender requesting such Lender's determination, consent, approval or disapproval (a) shall be given in the form of a written notice to such Lender, (b) shall be accompanied by a description of the matter or issue as to which such determination, approval, consent or disapproval is requested, or shall advise such Lender where information, if any, regarding such matter or issue may be inspected, or shall otherwise describe the matter or issue to be resolved, (c) shall include, if reasonably requested by such Lender and to the extent not previously provided to such Lender, written materials provided to the Administrative Agent by the Borrower in respect of the matter or issue to be resolved, and (d) shall include the Administrative Agent's recommended course of action or determination in respect thereof. Unless a Lender shall give written notice to the Administrative Agent that it specifically objects to the recommendation or determination of the Administrative Agent (together with a reasonable written explanation of the reasons behind such objection) within ten (10) Business Days (or such lesser or greater period as may be specifically required under the express terms of the Loan Documents) of receipt of such communication, such Lender shall be deemed to have conclusively approved of or consented to such recommendation or determination.
Section 12.4.
Notice of Events of Default.
The Administrative Agent shall not be deemed to have knowledge or notice of the occurrence of a Default or Event of Default (excepting only a Default or Event of Default under Section 11.1(a)) unless the Administrative Agent has received notice from a Lender or the Borrower referring to this Agreement,
describing with reasonable specificity such Default or Event of Default and stating that such notice is a “notice of default.” If any Lender (excluding the Lender which is also serving as the Administrative Agent) becomes aware of any Default or Event of Default, it shall promptly send to the Administrative Agent such a “notice of default”. Further, if the Administrative Agent receives such a “notice of default,” the Administrative Agent shall give prompt notice thereof to the Lenders.
Section 12.5.
Administrative Agent's Reliance.
Notwithstanding any other provisions of this Agreement or any other Loan Documents, neither the Administrative Agent nor any of its directors, officers, agents, employees or counsel shall be liable for any action taken or not taken by it under or in connection with this Agreement or any other Loan Document, except for its or their own gross negligence or willful misconduct in connection with its duties expressly set forth herein or therein as determined by a court of competent jurisdiction in a final non-appealable judgment. Without limiting the generality of the foregoing, the Administrative Agent: may consult with legal counsel (including its own counsel or counsel for the Borrower, any other Loan Party or the Parent), independent public accountants and other experts selected by it and shall not be liable for any action taken or omitted to be taken in good faith by it in accordance with the advice of such counsel, accountants or experts. Neither the Administrative Agent nor any of its directors, officers, agents, employees or counsel: (a) makes any warranty or representation to any Lender, the Issuing Bank or any other Person and shall be responsible to any Lender, the Issuing Bank or any other Person for any statement, warranty or representation made or deemed made by the Borrower, any other Loan Party, the Parent or any other Person in or in connection with this Agreement or any other Loan Document; (b) shall have any duty to ascertain or to inquire as to the performance or observance of any of the terms, covenants or conditions of this Agreement or any other Loan Document or the satisfaction of any conditions precedent under this Agreement or any Loan Document on the part of the Borrower or other Persons or inspect the property, books or records of the Borrower or any other Person; (c) shall be responsible to any Lender or the Issuing Bank for the due execution, legality, validity, enforceability, genuineness, sufficiency or value of this Agreement or any other Loan Document, any other instrument or document furnished pursuant thereto or any collateral covered thereby or the perfection or priority of any Lien in favor of the Administrative Agent on behalf of the Lenders, the Issuing Bank and the Specified Derivatives Providers in any such collateral; (d) shall have any liability in respect of any recitals, statements, certifications, representations or warranties contained in any of the Loan Documents or any other document, instrument, agreement, certificate or statement delivered in connection therewith; and (e) shall incur any liability under or in respect of this Agreement or any other Loan Document by acting upon any notice, consent, certificate or other instrument or writing (which may be by telephone, telecopy or electronic mail) believed by it to be genuine and signed, sent or given by the proper party or parties. The Administrative Agent may execute any of its duties under the Loan Documents by or through agents, employees or attorneys-in-fact and shall not be responsible for the negligence or misconduct of any agent or attorney-in-fact that it selects in the absence of gross negligence or willful misconduct as determined by a court of competent jurisdiction in a final non-appealable judgment.
Section 12.6.
Indemnification of Administrative Agent.
Regardless of whether the transactions contemplated by this Agreement and the other Loan Documents are consummated, each Lender agrees to indemnify the Administrative Agent (to the extent not reimbursed by the Borrower and without limiting the obligation of the Borrower to do so) pro rata in accordance with such Lender's respective Pro Rata Share, from and against any and all liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements of any kind or nature whatsoever which may at any time be imposed on, incurred by, or asserted against the
Administrative Agent (in its capacity as Administrative Agent but not as a “Lender”) in any way relating to or arising out of the Loan Documents, any transaction contemplated hereby or thereby or any action taken or omitted by the Administrative Agent under the Loan Documents (collectively, “Indemnifiable Amounts”); provided, however, that no Lender shall be liable for any portion of such Indemnifiable Amounts to the extent resulting from the Administrative Agent's gross negligence or willful misconduct as determined by a court of competent jurisdiction in a final, non-appealable judgment;
provided
,
however
, that no action taken in accordance with the directions of the Requisite Lenders (or all of the Lenders, if expressly required hereunder) shall be deemed to constitute gross negligence or willful misconduct for purposes of this Section. Without limiting the generality of the foregoing, each Lender agrees to reimburse the Administrative Agent (to the extent not reimbursed by the Borrower and without limiting the obligation of the Borrower to do so) promptly upon demand for its ratable share of any expenses (including the reasonable fees and expenses of outside counsel to the Administrative Agent but excluding the allocated costs, fees and expenses of the Administrative Agent's in-house counsel and legal staff and any expenses incurred by the Administrative Agent in connection with its review of any appraisal or environmental, structural or engineering report) reasonably incurred by the Administrative Agent in connection with the preparation, negotiation, execution, administration, or enforcement (whether through negotiations, legal proceedings, or otherwise) of, or legal advice with respect to the rights or responsibilities of the parties under, the Loan Documents, any suit or action brought by the Administrative Agent to enforce the terms of the Loan Documents and/or collect any Obligations, any “lender liability” suit or claim brought against the Administrative Agent and/or the Lenders, and any claim or suit brought against the Administrative Agent and/or the Lenders arising under any Environmental Laws. Such expenses (including counsel fees) shall be advanced by the Lenders on the request of the Administrative Agent notwithstanding any claim or assertion that the Administrative Agent is not entitled to indemnification hereunder upon receipt of an undertaking by the Administrative Agent that the Administrative Agent will reimburse the Lenders if it is actually and finally determined by a court of competent jurisdiction that the Administrative Agent is not so entitled to indemnification. The agreements in this Section shall survive the payment of the Loans and all other amounts payable hereunder or under the other Loan Documents and the termination of this Agreement. If the Borrower shall reimburse the Administrative Agent for any Indemnifiable Amount following payment by any Lender to the Administrative Agent in respect of such Indemnifiable Amount pursuant to this Section, the Administrative Agent shall share such reimbursement on a ratable basis with each Lender making any such payment.
Section 12.7.
Lender Credit Decision, Etc.
Each of the Lenders and the Issuing Bank expressly acknowledges and agrees that neither the Administrative Agent nor any of its officers, directors, employees, agents, counsel, attorneys-in-fact or other affiliates has made any representations or warranties to the Issuing Bank or such Lender and that no act by the Administrative Agent hereafter taken, including any review of the affairs of the Parent, the Borrower, any other Loan Party or any other Subsidiary or Affiliate, shall be deemed to constitute any such representation or warranty by the Administrative Agent to the Issuing Bank or any Lender. Each of the Lenders and the Issuing Bank acknowledges that it has, independently and without reliance upon the Administrative Agent, any other Lender or counsel to the Administrative Agent, or any of their respective officers, directors, employees, agents or counsel, and based on the financial statements of the Parent, the Borrower, the other Loan Parties, the other Subsidiaries and other Affiliates, and inquiries of such Persons, its independent due diligence of the business and affairs of the Parent, the Borrower, the other Loan Parties, the other Subsidiaries and other Persons, its review of the Loan Documents, the legal opinions required to be delivered to it hereunder, the advice of its own counsel and such other documents and information as it has deemed appropriate, made its own credit and legal analysis and decision to enter
into this Agreement and the transactions contemplated hereby. Each of the Lenders and the Issuing Bank also acknowledges that it will, independently and without reliance upon the Administrative Agent, any other Lender or counsel to the Administrative Agent or any of their respective officers, directors, employees and agents, and based on such review, advice, documents and information as it shall deem appropriate at the time, continue to make its own decisions in taking or not taking action under the Loan Documents. The Administrative Agent shall not be required to keep itself informed as to the performance or observance by the Parent, the Borrower or any other Loan Party of the Loan Documents or any other document referred to or provided for therein or to inspect the properties or books of, or make any other investigation of, the Parent, the Borrower, any other Loan Party or any other Subsidiary. Except for notices, reports and other documents and information expressly required to be furnished to the Lenders and the Issuing Bank by the Administrative Agent under this Agreement or any of the other Loan Documents, the Administrative Agent shall have no duty or responsibility to provide any Lender or the Issuing Bank with any credit or other information concerning the business, operations, property, financial and other condition or creditworthiness of the Parent, the Borrower, any other Loan Party or any other Affiliate thereof which may come into possession of the Administrative Agent or any of its officers, directors, employees, agents, attorneys-in-fact or other Affiliates. Each of the Lenders and the Issuing Bank acknowledges that the Administrative Agent's legal counsel in connection with the transactions contemplated by this Agreement is only acting as counsel to the Administrative Agent and is not acting as counsel to any Lender or the Issuing Bank.
Section 12.8.
Successor Administrative Agent.
The Administrative Agent may resign at any time as Administrative Agent under the Loan Documents by giving written notice thereof to the Lenders and the Borrower. The Administrative Agent may be removed as administrative agent by all of the Lenders (other than the Lender then acting as Administrative Agent) and the Borrower upon 30 days' prior written notice if the Administrative Agent (i) is found by a court of competent jurisdiction in a final, non-appealable judgment to have committed gross negligence or willful misconduct in the course of performing its duties hereunder or (ii) has become or is insolvent or has become the subject of a bankruptcy or insolvency proceeding, or has had a receiver, conservator, trustee or custodian appointed for it, or has taken any action in furtherance of, or indicating its consent to, approval of or acquiescence in any such proceeding or appointment. Upon any such resignation or removal, the Requisite Lenders shall have the right to appoint a successor Administrative Agent which appointment shall, provided no Default or Event of Default exists, be subject to the Borrower's approval, which approval shall not be unreasonably withheld or delayed (except that the Borrower shall, in all events, be deemed to have approved each Lender and any of its affiliates as a successor Administrative Agent). If no successor Administrative Agent shall have been so appointed in accordance with the immediately preceding sentence, and shall have accepted such appointment, within thirty (30) days after the current Administrative Agent's giving of notice of resignation or the Lenders' removal of the current Administrative Agent, then the current Administrative Agent may, on behalf of the Lenders and the Issuing Bank, appoint a successor Administrative Agent, which shall be a Lender, if any Lender shall be willing to serve, and otherwise shall be an Eligible Assignee. Upon the acceptance of any appointment as Administrative Agent hereunder by a successor Administrative Agent, such successor Administrative Agent shall thereupon succeed to and become vested with all the rights, powers, privileges and duties of the current Administrative Agent, and the current Administrative Agent shall be discharged from its duties and obligations under the Loan Documents. Such successor Administrative Agent shall issue letters of credit in substitution for the Letters of Credit, if any, outstanding at the time of such succession or shall make other arrangements satisfactory to the current Administrative Agent, in either case, to assume effectively the obligations of the current Administrative Agent with respect to such Letters of Credit. After any Administrative Agent's resignation or removal hereunder as Administrative
Agent, the provisions of this Article XII. shall continue to inure to its benefit as to any actions taken or omitted to be taken by it while it was Administrative Agent under the Loan Documents. Notwithstanding anything contained herein to the contrary, the Administrative Agent may assign its rights and duties under the Loan Documents to any of its affiliates by giving the Borrower and each Lender prior written notice.
Section 12.9.
Titled Agents.
The Syndication Agent, each Documentation Agent and each Co-Lead Arranger (each a “Titled Agent”) in each such respective capacity, assumes no responsibility or obligation hereunder, including, without limitation, for servicing, enforcement or collection of any of the Loans, nor any duties as an agent hereunder for the Lenders. The titles given to the Titled Agents are solely honorific and imply no fiduciary responsibility on the part of the Titled Agents to the Administrative Agent, any Lender, the Parent, the Borrower or any other Loan Party and the use of such titles does not impose on the Titled Agents any duties or obligations greater than those of any other Lender or entitle the Titled Agents to any rights other than those to which any other Lender is entitled.
Article XIII. Miscellaneous
Section 13.1.
Notices.
Unless otherwise provided herein (including without limitation as provided in Section 9.5.), communications provided for hereunder shall be in writing and shall be mailed, telecopied, or delivered as follows:
If to the Borrower:
CBL & Associates Limited Partnership
c/o CBL & Associates Properties, Inc.
2030 Hamilton Place Blvd., Suite 500
Chattanooga, Tennessee 37421-6000
Attention: Chief Financial Officer
Telecopy Number: (423) 490-8390
Telephone Number: (423) 855-0001
with an informational copy to:
CBL & Associates Limited Partnership
c/o CBL & Associates Properties, Inc.
2030 Hamilton Place Blvd., Suite 500
Chattanooga, Tennessee 37421-6000
Attention: Finance Counsel
Telecopy Number: (423) 490-8390
Telephone Number: (423) 855-0001
If to the Administrative Agent:
Wells Fargo Bank, National Association
123 North Wacker Drive, Suite 1900
Chicago, IL 60606
Attn: Loan Administration
Telecopier Number: 312/782-0969
Telephone Number: 312/269-8250
If to the Issuing Bank:
Wells Fargo Bank, National Association
123 North Wacker Drive, Suite 1900
Chicago, IL 60606
Attn: Loan Administration
Telecopier Number: 312/782-0969
Telephone Number: 312/269-8250
If to any other Lender:
To such Lender's address or telecopy number as set forth in the applicable Administrative Questionnaire.
or, as to each party at such other address as shall be designated by such party in a written notice to the other parties delivered in compliance with this Section; provided, a Lender or the Issuing Bank shall only be required to give notice of any such other address to the Administrative Agent and the Borrower. All such notices and other communications shall be effective (i) if mailed, upon the first to occur of receipt or the expiration of three (3) days after the deposit in the United States Postal Service mail, postage prepaid and addressed to the address of the Borrower or the Administrative Agent, the Issuing Bank and Lenders at the addresses specified; (ii) if telecopied, upon confirmation of transmission; (iii) if hand delivered or sent by overnight courier, when delivered; or (iv) if delivered in accordance with Section 9.5. to the extent applicable; provided, however, that, in the case of the immediately preceding clauses (i), (ii) and (iii), non-receipt of any communication as of the result of any change of address of which the sending party was not notified or as the result of a refusal to accept delivery shall be deemed receipt of such communication. Notwithstanding the immediately preceding sentence, all notices or communications to the Administrative Agent, the Issuing Bank or any Lender under Articles II. and IV. shall be effective only when actually received. None of the Administrative Agent, the Issuing Bank or any Lender shall incur any liability to the Parent, the Borrower or any Loan Party (nor shall the Administrative Agent incur any liability to the Lenders) for acting upon any telephonic notice referred to in this Agreement which the Administrative Agent, the Issuing Bank or such Lender, as the case may be, believes in good faith to have been given by a Person authorized to deliver such notice or for otherwise acting in good faith hereunder. In addition to the Administrative Agent's Lending Office, the Borrower shall send copies of the notices described in Article II. to the following address of the Administrative Agent:
Wells Fargo Bank, National Association
Minneapolis Loan Center
608 2nd Avenue South, 11th Floor
Minneapolis, MN 55402
Attention: Treva Lee
Telecopier Number: 877/718-0796
Telephone Number: 612/316-4317
Section 13.2.
Expenses.
The Borrower agrees (a) to pay or reimburse the Administrative Agent for all of its reasonable costs and expenses incurred in connection with the preparation, negotiation and execution of, and any amendment, supplement or modification to, any of the Loan Documents (including due diligence expense and reasonable travel expenses related to closing), and the consummation of the transactions contemplated hereby and thereby, including the reasonable fees and disbursements of counsel to the Administrative Agent and all costs and expenses of the Administrative Agent in connection with the use of IntraLinks, SyndTrak or other similar information transmission systems in connection with the Loan Documents and the reasonable fees and disbursements of counsel to the Administrative Agent relating to all such activities, (b) to pay to the Issuing Bank all reasonable out-of-pocket costs and expenses incurred by the Issuing Bank in connection with the issuance, amendment, renewal or extension of any Letter of Credit or any demand for payment thereunder, (c) to pay or reimburse the Administrative Agent, the Issuing Bank and the Lenders for all their reasonable costs and expenses incurred in connection with the enforcement or preservation of any rights under the Loan Documents and the Fee Letter, including the reasonable fees and disbursements of counsel retained by the Administrative Agent and of one law firm retained by the Lenders (including the allocated fees and expenses of in-house counsel) and any payments in indemnification or otherwise payable by the Lenders to the Administrative Agent pursuant to the Loan Documents, (d) to pay, and indemnify and hold harmless the Administrative Agent, the Issuing Bank and the Lenders from, any and all recording and filing fees and any and all liabilities with respect to, or resulting from any failure to pay or delay in paying, documentary, stamp, excise and other similar taxes, if any, which may be payable or determined to be payable in connection with the execution and delivery of any of the Loan Documents, or consummation of any amendment, supplement or modification of, or any waiver or consent under or in respect of, any Loan Document and (e) to the extent not already covered by any of the preceding subsections, to pay the reasonable fees and disbursements of counsel to the Administrative Agent, the Issuing Bank and any Lender incurred in connection with the representation of the Administrative Agent, the Issuing Bank or such Lender in any matter relating to or arising out of any bankruptcy or other proceeding of the type described in Sections 11.1.(e) or 11.1.(f), including, without limitation (i) any motion for relief from any stay or similar order, (ii) the negotiation, preparation, execution and delivery of any document relating to the Obligations and (iii) the negotiation and preparation of any debtor-in-possession financing or any plan of reorganization of the Parent, the Borrower or any other Loan Party, whether proposed by the Parent, the Borrower, such Loan Party, the Lenders or any other Person, and whether such fees and expenses are incurred prior to, during or after the commencement of such proceeding or the confirmation or conclusion of any such proceeding. If the Borrower shall fail to pay any amounts required to be paid by it pursuant to this Section, the Administrative Agent and/or the Lenders may pay such amounts on behalf of the Borrower and such amounts shall be deemed to be Obligations owing hereunder.
Section 13.3.
Stamp, Intangible and Recording Taxes.
The Borrower will pay any and all stamp, excise, intangible, registration, recordation and similar taxes, fees or charges and shall indemnify the Administrative Agent and each Lender against any and all liabilities with respect to or resulting from any delay in the payment or omission to pay any such taxes, fees or charges, which may be payable or determined to be payable in connection with the execution, delivery, recording, performance or enforcement of this Agreement, the Notes and any of the other Loan Documents, the amendment, supplement, modification or waiver of or consent under this Agreement, the Notes or any of the other Loan Documents or the perfection of any rights or Liens under this Agreement, the Notes or any of the other Loan Documents.
Section 13.4.
Setoff.
Subject to Section 3.3. and in addition to any rights now or hereafter granted under Applicable Law and not by way of limitation of any such rights, the Borrower hereby authorizes the Administrative Agent, the Issuing Bank, each Lender, each Affiliate of the Administrative Agent, the Issuing Bank or any Lender, and each Participant, at any time or from time to time while an Event of Default exists, without notice to the Borrower or to any other Person, any such notice being hereby expressly waived, but in the case of the Issuing Bank, a Lender, an Affiliate of the Issuing Bank or a Lender, or a Participant, subject to receipt of the prior written consent of the Requisite Lenders exercised in their sole discretion, to set off and to appropriate and to apply any and all deposits (general or special, including, but not limited to, indebtedness evidenced by certificates of deposit, whether matured or unmatured) and any other indebtedness at any time held or owing by the Administrative Agent, the Issuing Bank, such Lender, any Affiliate of the Administrative Agent, the Issuing Bank or such Lender, or such Participant, to or for the credit or the account of the Borrower against and on account of any of the Obligations, irrespective of whether or not any or all of the Loans and all other Obligations have been declared to be, or have otherwise become, due and payable as permitted by Section 11.2., and although such Obligations shall be contingent or unmatured. Notwithstanding the foregoing, each Lender hereby waives any right of setoff against the Obligations it has with respect to any deposit account of any Guarantor (other than the Parent) maintained with such Lender or any other account or property of such Guarantor held by such Lender; provided however, that this waiver is not intended, and shall not be deemed, to waive any right of setoff (a) any Lender has with respect to any account required to be maintained pursuant to this Agreement or any other Loan Document or (b) arising other than pursuant to this Agreement or the other Loan Documents.
Section 13.5.
Litigation; Jurisdiction; Other Matters; Waivers.
(a)
EACH PARTY HERETO ACKNOWLEDGES THAT ANY DISPUTE OR CONTROVERSY BETWEEN OR AMONG THE BORROWER, THE PARENT, THE ADMINISTRATIVE AGENT, THE ISSUING BANK OR ANY OF THE LENDERS WOULD BE BASED ON DIFFICULT AND COMPLEX ISSUES OF LAW AND FACT AND WOULD RESULT IN DELAY AND EXPENSE TO THE PARTIES. ACCORDINGLY, TO THE EXTENT PERMITTED BY APPLICABLE LAW, EACH OF THE LENDERS, THE ADMINISTRATIVE AGENT, THE ISSUING BANK, THE BORROWER AND THE PARENT HEREBY WAIVES ITS RIGHT TO A TRIAL BY JURY IN ANY ACTION OR PROCEEDING OF ANY KIND OR NATURE IN ANY COURT OR TRIBUNAL IN WHICH AN ACTION MAY BE COMMENCED BY OR AGAINST ANY PARTY HERETO ARISING OUT OF THIS AGREEMENT, THE NOTES, OR ANY OTHER LOAN DOCUMENT OR THE FEE LETTER OR BY REASON OF ANY OTHER SUIT, CAUSE OF ACTION OR DISPUTE WHATSOEVER BETWEEN OR AMONG THE BORROWER, THE PARENT, THE ADMINISTRATIVE AGENT, THE ISSUING BANK OR ANY OF THE LENDERS OF ANY KIND OR NATURE.
(b)
THE BORROWER AND EACH OTHER LOAN PARTY IRREVOCABLY AND UNCONDITIONALLY AGREES THAT IT WILL NOT COMMENCE ANY ACTION, LITIGATION OR PROCEEDING OF ANY KIND OR DESCRIPTION, WHETHER IN LAW OR EQUITY, WHETHER IN CONTRACT OR IN TORT OR OTHERWISE, AGAINST THE ADMINISTRATIVE AGENT, ANY LENDER, THE ISSUING BANK, OR ANY RELATED PARTY OF THE FOREGOING IN ANY WAY RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS RELATING HERETO OR THERETO, IN ANY FORUM OTHER THAN THE COURTS OF THE STATE OF NEW YORK 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, AND EACH OF THE PARTIES HERETO IRREVOCABLY AND UNCONDITIONALLY SUBMITS TO THE JURISDICTION OF SUCH COURTS AND AGREES THAT ALL CLAIMS IN RESPECT OF ANY SUCH ACTION, LITIGATION OR PROCEEDING MAY BE HEARD AND DETERMINED IN SUCH NEW YORK STATE COURT OR, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, IN SUCH FEDERAL COURT. EACH OF THE PARTIES HERETO AGREES THAT A FINAL, NON-APPEALABLE JUDGMENT IN ANY SUCH ACTION, LITIGATION 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 AGREEMENT OR IN ANY OTHER LOAN DOCUMENT SHALL AFFECT ANY RIGHT THAT THE ADMINISTRATIVE AGENT, ANY LENDER OR THE ISSUING BANK MAY OTHERWISE HAVE TO BRING ANY ACTION OR PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT AGAINST THE BORROWER OR ANY OTHER LOAN PARTY OR ITS PROPERTIES IN THE COURTS OF ANY JURISDICTION. EACH PARTY FURTHER WAIVES ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH ACTION OR PROCEEDING IN ANY SUCH COURT OR THAT SUCH ACTION OR PROCEEDING WAS BROUGHT IN AN INCONVENIENT FORUM AND EACH AGREES NOT TO PLEAD OR CLAIM THE SAME. THE CHOICE OF FORUM SET FORTH IN THIS SECTION SHALL NOT BE DEEMED TO PRECLUDE THE BRINGING OF ANY ACTION BY THE ADMINISTRATIVE AGENT, THE ISSUING BANK OR ANY LENDER OR THE ENFORCEMENT BY THE ADMINISTRATIVE AGENT, THE ISSUING BANK OR ANY LENDER OF ANY JUDGMENT OBTAINED IN SUCH FORUM IN ANY OTHER APPROPRIATE JURISDICTION.
(c)
THE BORROWER HEREBY WAIVES PERSONAL SERVICE OF THE SUMMONS AND COMPLAINT, OR OTHER PROCESS OR PAPERS ISSUED THEREIN, AND AGREES THAT SERVICE OF SUCH SUMMONS AND COMPLAINT, OR OTHER PROCESS OR PAPERS MAY BE MADE BY REGISTERED OR CERTIFIED MAIL ADDRESSED TO THE BORROWER AT ITS ADDRESS FOR NOTICES PROVIDED FOR HEREIN. SHOULD THE BORROWER FAIL TO APPEAR OR ANSWER ANY SUMMONS, COMPLAINT, PROCESS OR PAPERS SO SERVED WITHIN THIRTY (30) DAYS AFTER THE MAILING THEREOF, THE BORROWER SHALL BE DEEMED IN DEFAULT AND AN ORDER AND/OR JUDGMENT MAY BE ENTERED AGAINST IT AS DEMANDED OR PRAYED FOR IN SUCH SUMMONS, COMPLAINT, PROCESS OR PAPERS.
(d)
THE PROVISIONS OF THIS SECTION HAVE BEEN CONSIDERED BY EACH PARTY WITH THE ADVICE OF COUNSEL AND WITH A FULL UNDERSTANDING OF THE LEGAL CONSEQUENCES THEREOF, AND SHALL SURVIVE THE PAYMENT OF THE LOANS AND ALL OTHER AMOUNTS PAYABLE HEREUNDER OR UNDER THE OTHER LOAN DOCUMENTS, THE TERMINATION OR EXPIRATION OF ALL LETTERS OF CREDIT AND THE TERMINATION OF THIS AGREEMENT.
Section 13.6.
Successors and Assigns.
(a)
Successors and Assigns Generally
. The provisions of this Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns permitted hereby, except that neither the Borrower nor any other Loan Party may assign or otherwise transfer any of its rights or obligations hereunder without the prior written consent of the Administrative Agent and each Lender and no Lender may assign or otherwise transfer any of its rights or obligations hereunder except (i) to an Eligible Assignee in accordance with the provisions of the immediately following subsection (b),
(ii) by way of participation in accordance with the provisions of the immediately following subsection (d) or (iii) by way of pledge or assignment of a security interest subject to the restrictions of the immediately following subsection (f) (and, subject to the last sentence of the immediately following subsection (b), any other attempted assignment or transfer by any party hereto shall be null and void). Nothing in this Agreement, expressed or implied, shall be construed to confer upon any Person (other than the parties hereto, their respective successors and assigns permitted hereby, Participants to the extent provided in the immediately following subsection (d) and, to the extent expressly contemplated hereby, the Related Parties of the Administrative Agent and the Lenders) any legal or equitable right, remedy or claim under or by reason of this Agreement.
(b)
Assignments by Lenders
. Any Lender may at any time assign to one or more Eligible Assignees all or a portion of its rights and obligations under this Agreement (including all or a portion of its Commitment and the Loans at the time owing to it);
provided
that any such assignment shall be subject to the following conditions:
(i)
Minimum Amounts
.
(A)
in the case of an assignment of the entire remaining amount of an assigning Lender's Revolving Commitment and the Loans at the time owing to it, or in the case of an assignment to a Lender, an Affiliate of a Lender or an Approved Fund, no minimum amount need be assigned; and
(B)
in any case not described in the immediately preceding subsection (A), the aggregate amount of the Revolving Commitment (which for this purpose includes Loans outstanding thereunder) or, if the applicable Revolving Commitment is not then in effect, the principal outstanding balance of the Loans of the assigning Lender subject to each such assignment (as determined as of the date the Assignment and Assumption with respect to such assignment is delivered to the Administrative Agent or, if “Trade Date” is specified in the Assignment and Assumption, as of the Trade Date) shall not be less than $5,000,000 in the case of any assignment of a Revolving Commitment, unless each of the Administrative Agent and, so long as no Default or Event of Default shall exist, the Borrower otherwise consents (each such consent not to be unreasonably withheld or delayed); provided, however, that if, after giving effect to such assignment, the amount of the Commitment held by such assigning Lender or the outstanding principal balance of the Loans of such assigning Lender, as applicable, would be less than $5,000,000 in the case of a Commitment or Revolving Loans, then such assigning Lender shall assign the entire amount of its Commitment and the Loans at the time owing to it.
(ii)
Proportionate Amounts
. Each partial assignment shall be made as an assignment of a proportionate part of all the assigning Lender's rights and obligations under this Agreement with respect to the Loan or the Revolving Commitment assigned.
(iii)
Required Consents
. No consent shall be required for any assignment except to the extent required by clause (i)(B) of this subsection (b) and, in addition:
(A)
the consent of the Borrower (such consent not to be unreasonably withheld or delayed) shall be required unless (x) a Default or Event of Default shall exist at the time of such assignment or (y) such assignment is to a Lender, an Affiliate of a Lender or an Approved Fund; provided that the Borrower shall be deemed to have
consented to any such assignment unless it shall object thereto by written notice to the Administrative Agent within five (5) Business Days after having received notice thereof;
(B)
the consent of the Administrative Agent (such consent not to be unreasonably withheld or delayed) shall be required for assignments in respect of a Revolving Commitment if such assignment is to a Person that is not already a Lender with a Commitment, an Affiliate of such a Lender or an Approved Fund with respect to such a Lender; and
(C)
the consent of the Swingline Lender and the Issuing Bank (such consent not to be unreasonably withheld or delayed) shall be required for any assignment in respect of a Revolving Commitment.
(iv)
Assignment and Acceptance; Notes
. The parties to each assignment shall execute and deliver to the Administrative Agent an Assignment and Acceptance, together with a processing and recordation fee of $4,500 for each assignment ($7,500 for any Defaulting Lender), and the assignee, if it is not a Lender, shall deliver to the Administrative Agent an Administrative Questionnaire. If requested by the transferor Lender or the assignee, upon the consummation of any assignment, the transferor Lender, the Administrative Agent and the Borrower shall make appropriate arrangements so that new Notes are issued to the assignee and such transferor Lender, as appropriate.
(v)
No Assignment to Borrower
. No such assignment shall be made to the Borrower or any of the Borrower's Affiliates or Subsidiaries.
(vi)
No Assignment to Natural Persons
. No such assignment shall be made to a natural person.
(vii)
Assignments by Specified Derivatives Provider
. If the assigning Lender (or its Affiliate) is a Specified Derivatives Provider and if after giving effect to such assignment such Lender will hold no further Loans or Revolving Commitments under this Agreement, such Lender shall undertake such assignment only contemporaneously with an assignment by such Lender (or its Affiliate, as the case may be) of all of its Specified Derivatives Contracts to the assignee or another Lender (or Affiliate thereof).
Subject to acceptance and recording thereof by the Administrative Agent pursuant to the immediately following subsection (c), from and after the effective date specified in each Assignment and Acceptance, the assignee thereunder shall be a party to this Agreement and, to the extent of the interest assigned by such Assignment and Assumption, have the rights and obligations of a Lender under this Agreement, and the assigning Lender thereunder shall, to the extent of the interest assigned by such Assignment and Assumption, be released from its obligations under this Agreement (and, in the case of an Assignment and Assumption covering all of the assigning Lender's rights and obligations under this Agreement, such Lender shall cease to be a party hereto) but shall continue to be entitled to the benefits of Sections 5.4., 13.2. and 13.10. and the other provisions of this Agreement and the other Loan Documents as provided in Section 13.11. with respect to facts and circumstances occurring prior to the effective date of such assignment. Any assignment or transfer by a Lender of rights or obligations under this Agreement that does not comply with this paragraph shall be treated for purposes of this Agreement as a sale by such Lender of a participation in such rights and obligations in accordance with the immediately following subsection (d).
(c)
Register
. The Administrative Agent, acting solely for this purpose as an agent of the Borrower, shall maintain at the Principal Office a copy of each Assignment and Assumption delivered to it and a register for the recordation of the names and addresses of the Lenders, and the Commitments of, and principal amounts of the Loans owing to, each Lender pursuant to the terms hereof from time to time (the “Register”). The entries in the Register shall be conclusive, and the Borrower, the Administrative Agent and the Lenders may treat each Person whose name is recorded in the Register pursuant to the terms hereof as a Lender hereunder for all purposes of this Agreement, notwithstanding notice to the contrary. The Register shall be available for inspection by the Borrower and any Lender, at any reasonable time and from time to time upon reasonable prior notice. Each Lender that sells a participation as described in Section 13.6.(d) shall, acting solely for this purpose as an agent of the Borrower, maintain a register on which it enters the name and address of each Participant and the principal amounts (and stated interest) of each Participant's interest in the Loans or other obligations under this Agreement (the “
Participant Register
”); provided that no Lender shall have any obligation to disclose all or any portion of the Participant Register to any Person (including the identity of any Participant or any information relating to a Participant's interest in any Commitments, Loans, or its other obligations under this Agreement) 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 Treasury Regulations. 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.
(d)
Participations
. Any Lender may at any time, without the consent of, or notice to, the Borrower or the Administrative Agent, sell participations to any Person (other than a natural person or the Borrower or any of the Borrower'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 Loans 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) the Borrower, the Administrative 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 (w) increase such Lender's Commitment, (x) extend the date fixed for the payment of principal on the Loans or portions thereof owing to such Lender, (y) reduce the rate at which interest is payable thereon or (z) release any Guarantor from its Obligations under the Guaranty. Subject to the immediately following subsection (e), the Borrower agrees that each Participant shall be entitled to the benefits of Sections 3.10., 5.1., 5.4.
to the same extent as if it were a Lender and had acquired its interest by assignment pursuant to paragraph (b) of this Section. To the extent permitted by Applicable Law, each Participant also shall be entitled to the benefits of Section 13.4. as though it were a Lender, provided such Participant agrees to be subject to Section 3.3. as though it were a Lender.
(e)
Limitations upon Participant Rights
. A Participant shall not be entitled to receive any greater payment under Sections 3.10. and 5.1. 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 the Borrower's prior written consent. A Participant that would be a Foreign Lender if it were a Lender shall not be entitled to the benefits of Section 3.10. unless the Borrower is notified of the participation sold to such Participant and such Participant agrees, for the benefit of the Borrower and the Administrative Agent, to comply with Section 3.10.(c) as though it were a Lender.
(f)
Certain Pledges
. Any Lender may at any time pledge or assign a security interest in all or any portion of its rights under this Agreement to secure obligations of such Lender, including any pledge or assignment to secure obligations to a Federal Reserve Bank; provided that no such pledge or assignment shall release such Lender from any of its obligations hereunder or substitute any such pledgee or assignee for such Lender as a party hereto.
(g)
No Registration
. Each Lender agrees that, without the prior written consent of the Borrower and the Administrative Agent, it will not make any assignment hereunder in any manner or under any circumstances that would require registration or qualification of, or filings in respect of, any Loan or Note under the Securities Act or any other securities laws of the United States of America or of any other jurisdiction.
Section 13.7.
Amendments and Waivers.
(a)
Generally
. Except as otherwise expressly provided in this Agreement, (i) any consent or approval required or permitted by this Agreement or in any Loan Document to be given by the Lenders may be given, (ii) any term of this Agreement or of any other Loan Document (other than any fee letter solely between Borrower and the Administrative Agent) may be amended, (iii) the performance or observance by the Borrower or any other Loan Party of any terms of this Agreement or such other Loan Document (other than any fee letter solely between Borrower and the Administrative Agent) may be waived, and (iv) 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 Requisite Lenders (or the Administrative Agent at the written direction of the Requisite Lenders), and, in the case of an amendment to any Loan Document, the written consent of each Loan Party which is party thereto. Subject to the immediately following subsection (c), any term of this Agreement or of any other Loan Document relating to the rights or obligations of the Lenders may be amended, and the performance or observance by the Borrower or any other Loan Party or any Subsidiary of any such terms may be waived (either generally or in a particular instance and either retroactively or prospectively) with, and only with, the written consent of the Requisite Lenders (and, in the case of an amendment to any Loan Document, the written consent of each Loan Party a party thereto). Notwithstanding anything to the contrary set forth in this Section 13.7.(a), the Administrative Agent shall be authorized on behalf of all the Lenders, without the necessity of any notice to, or further consent from, any Lender, to waive the imposition of the late fees provided in Section 2.8.
(b)
Unanimous Consent of Lenders Directly Affected
. Notwithstanding the foregoing, no amendment, waiver or consent shall, unless in writing, and signed by all of the Lenders directly and adversely affected thereby (or the Administrative Agent at the written direction of the Lenders), do any of the following:
(i)
increase the Commitments of the Lenders (excluding any increase as a result of an assignment of Commitments permitted under Section 13.6. and any increases contemplated under Section 2.17.)
or subject the Lenders to any additional obligations;
(ii)
reduce the principal of, or interest rates that have accrued or that will be charged on the outstanding principal amount of, any Loans or other Obligations;
(iii)
reduce the amount of any Fees payable to the Lenders hereunder ; provided, however, the Administrative Agent shall be authorized on behalf of all Lenders, without the necessity of any notice to, or further consent from, any Lender, to waive the
imposition of the late fees provided in Section 2.8., up to a maximum of three (3) times per calendar year;
(iv)
postpone any date fixed for any payment of principal of, or interest on, any Loans or for the payment of Fees or any other Obligations, or extend the expiration date of any Letter of Credit beyond the Maturity Date except in accordance with Section 2.13.;
(v)
change the definitions of Revolving Commitment Percentage or Pro Rata Share (excluding any change as a result of an assignment of Commitments permitted under Section 13.6.);
(vi)
amend this Section or amend the definitions of the terms used in this Agreement or the other Loan Documents insofar as such definitions affect the substance of this Section;
(vii)
modify the definition of the term “Requisite Lenders” or modify in any other manner the number or percentage of the Lenders required to make any determinations or waive any rights hereunder or to modify any provision hereof;
(viii)
release any Guarantor from its obligations under the Guaranty
except as contemplated by Section 8.14.(b) or release Parent from the Parent Guaranty;
(ix)
waive a Default or Event of Default under Section 11.1.(a); or
(x)
amend, or waive the Borrower's compliance with, Section 2.15.
(c)
Amendment or Waiver by Administrative Agent
. The Administrative Agent may, subject to the terms of subsections (a) and (b) above, (i) approve any amendment to this Agreement that is administrative in nature or is otherwise reasonably determined by the Administrative Agent in good faith not to be material, and (ii) waive any obligation or waive or confirm as cured any default of any Loan Party hereunder or under any of the Loan Documents, to the extent such waiver is administrative in nature or such obligation or default is otherwise reasonably determined by the Administrative Agent in good faith not to be material.
(d)
Amendment of Administrative Agent's Duties, Etc
. No amendment, waiver or consent unless in writing and signed by the Administrative Agent, in addition to the Lenders required hereinabove to take such action, shall affect the rights or duties of the Administrative Agent under this Agreement or any of the other Loan Documents. Any amendment, waiver or consent relating to Section 2.3. or the obligations of the Swingline Lender under this Agreement or any other Loan Document shall, in addition to the Lenders required hereinabove to take such action, require the written consent of the Swingline Lender. Any amendment, waiver or consent relating to Section 2.2. or the obligations of the Issuing Bank under this Agreement or any other Loan Document shall, in addition to the Lenders required hereinabove to take such action, require the written consent of the Issuing Bank. Any amendment, waiver or consent with respect to any Loan Document that (i) diminishes the rights of a Specified Derivatives Provider in a manner or to an extent dissimilar to that affecting the Lenders or (ii) increases the liabilities or obligations of a Specified Derivatives Provider shall, in addition to the Lenders required hereinabove to take such action, require the consent of the Lender that is (or having an Affiliate that is) such Specified Derivatives Provider. No waiver shall extend to or affect any obligation not expressly waived or impair any right consequent thereon and any amendment, waiver or consent shall be effective only in the specific instance and for the specific purpose set forth therein. No course of dealing or delay or omission on the part of the
Administrative Agent or any Lender in exercising any right shall operate as a waiver thereof or otherwise be prejudicial thereto. Any Event of Default occurring hereunder shall continue to exist until such time as such Event of Default is waived in writing in accordance with the terms of this Section, notwithstanding any attempted cure or other action by the Parent, the Borrower, any other Loan Party or any other Person subsequent to the occurrence of such Event of Default. Except as otherwise explicitly provided for herein or in any other Loan Document, no notice to or demand upon the Borrower shall entitle the Borrower to other or further notice or demand in similar or other circumstances.
Section 13.8.
Non-Liability of Administrative Agent and Lenders.
The relationship between the Borrower, on the one hand, and the Lenders, the Issuing Bank and the Administrative Agent, on the other hand, shall be solely that of borrower and lender. Neither the Administrative Agent, the Issuing Bank nor any Lender shall have any fiduciary responsibilities to the Borrower and no provision in this Agreement or in any of the other Loan Documents, and no course of dealing between or among any of the parties hereto, shall be deemed to create any fiduciary duty owing by the Administrative Agent, the Issuing Bank or any Lender to any Lender, the Parent, the Borrower, any Subsidiary or any other Loan Party. Neither the Administrative Agent, the Issuing Bank nor any Lender undertakes any responsibility to the Borrower or the Parent to review or inform the Borrower or the Parent of any matter in connection with any phase of the business or operations of the Borrower, the Parent or any of their respective Subsidiaries or Affiliates.
Section 13.9.
Confidentiality.
Except as otherwise provided by Applicable Law, the Administrative Agent, the Issuing Bank and each Lender shall maintain the confidentiality of all Information (as defined below) in accordance with its customary procedure for handling confidential information of this nature and in accordance with safe and sound banking practices but in any event may make disclosure: (a) to its Affiliates and to its and its Affiliates' respective 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); (b) subject to an agreement containing provisions substantially the same as those of this Section, to (i) any actual or proposed assignee, Participant or other transferee in connection with a potential transfer of any Commitment or participation therein as permitted hereunder, or (ii) any actual or prospective counterparty (or its advisors) to any swap or derivative transaction relating to the Borrower and its obligations; (c) as required or requested by any Governmental Authority or representative thereof or pursuant to legal process or in connection with any legal proceedings, or as otherwise required by Applicable Law; (d) to the Administrative Agent's, Issuing Bank's or such Lender's independent auditors and other professional advisors (provided they shall be notified of the confidential nature of the information); (e) in connection with the exercise of any remedies under any Loan Document (or any Specified Derivatives Contract) or any action or proceeding relating to any Loan Document (or any such Specified Derivatives Contract) or the enforcement of rights hereunder or thereunder; (f) to the extent such Information (i) becomes publicly available other than as a result of a breach of this Section actually known by the Administrative Agent, the Issuing Bank or such Lender to be a breach of this Section or (ii) becomes available to the Administrative Agent, the Issuing Bank, any Lender or any Affiliate of the Administrative Agent, the Issuing Bank or any Lender on a non-confidential basis from a source other than the Borrower or any Affiliate of the Borrower; (g) to the extent requested by, or required to be disclosed to, any nationally recognized rating agency or regulatory or similar authority (including any self-regulatory authority, such as the National Association of Insurance Commissioners) having or purporting to have jurisdiction over it; (h) to bank trade publications, such information to consist of deal terms and other information
customarily found in such publications; (i) to any other party hereto; and (j) with the consent of the Borrower. Notwithstanding the foregoing, the Administrative Agent, the Issuing Bank and each Lender may disclose any such confidential information, without notice to the Borrower or any other Loan Party, to Governmental Authorities in connection with any regulatory examination of the Administrative Agent, the Issuing Bank or such Lender or in accordance with the regulatory compliance policy of the Administrative Agent, the Issuing Bank or such Lender. As used in this Section, the term “Information” means all information received from the Borrower, any other Loan Party, any other Subsidiary or Affiliate relating to any Loan Party or any of their respective businesses, other than any such information that is available to the Administrative Agent, any Lender or the Issuing Bank on a non-confidential basis prior to disclosure by the Borrower, any other Loan Party, any other Subsidiary or any Affiliate, provided that, in the case of any such information received from the Borrower, any other Loan Party, any other Subsidiary or any Affiliate after the date hereof, such information is clearly identified at the time of delivery as confidential. 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.
|
|
Section 13.10.
|
Indemnification.
|
(a)
The Borrower shall and hereby agrees to indemnify, defend and hold harmless the Administrative Agent, the Issuing Bank, the Lenders, all of the Affiliates of the Administrative Agent, each of the Lenders and the Issuing Bank and their respective directors, officers, shareholders, agents, employees and counsel (each referred to herein as an "Indemnified Party") from and against any and all of the following (collectively, the “Indemnified Costs”): losses, costs, claims, penalties, damages, liabilities, deficiencies, judgments or expenses of every kind and nature (including, without limitation, amounts paid in settlement, court costs and the fees and disbursements of counsel incurred in connection with any litigation, investigation, claim or proceeding or any advice rendered in connection therewith, but excluding Indemnified Costs indemnification in respect of which is specifically covered by Section 3.10. or 5.1. or expressly excluded from the coverage of such Sections) incurred by an Indemnified Party in connection with, arising out of, or by reason of, any suit, cause of action, claim, arbitration, investigation or settlement, consent decree or other proceeding (the foregoing referred to herein as an "Indemnity Proceeding") which is in any way related directly or indirectly to: (i) this Agreement or any other Loan Document or the transactions contemplated thereby; (ii) the making of any Loans or issuance of Letters of Credit hereunder; (iii) any actual or proposed use by the Borrower of the proceeds of the Loans or Letters of Credit; (iv) the Administrative Agent's, the Issuing Bank's or any Lender's entering into this Agreement or any other Loan Document; (v) the fact that the Administrative Agent, the Issuing Bank and the Lenders have established the credit facility evidenced hereby in favor of the Borrower; (vi) the fact that the Administrative Agent, the Issuing Bank and the Lenders are creditors of the Borrower and have or are alleged to have information regarding the financial condition, strategic plans or business operations of the Borrower and the Subsidiaries; (vii) the fact that the Administrative Agent, the Issuing Bank and the Lenders are material creditors of the Borrower and are alleged to influence directly or indirectly the business decisions or affairs of the Borrower and the Subsidiaries or their financial condition; (viii) the exercise of any right or remedy the Administrative Agent, the Issuing Bank or the Lenders may have under this Agreement or the other Loan Documents; provided, however, that the Borrower shall not be obligated to indemnify any Indemnified Party as set forth above for any acts or omissions of such Indemnified Party in connection with matters described in this clause (viii) that constitute gross negligence or willful misconduct on the part of such Indemnified Party as determined in a final non-appealable judgment by a court of competent jurisdiction; (ix) any civil penalty or fine assessed by the OFAC against, and all costs and expenses (including counsel fees and disbursements) incurred in
connection with defense thereof by, the Administrative Agent, the Issuing Bank or any Lender as a result of conduct of the Borrower, any other Loan Party or any other Subsidiary that violates a sanction administered or enforced by the OFAC; or (x) any violation or non-compliance by the Borrower or any Subsidiary of any Applicable Law (including any Environmental Law) including, but not limited to, any Indemnity Proceeding commenced by (A) the Internal Revenue Service or state taxing authority or (B) any Governmental Authority or other Person under any Environmental Law, including any Indemnity Proceeding commenced by a Governmental Authority or other Person seeking remedial or other action to cause the Borrower, its Subsidiaries or any other Loan Party (or its respective properties) (or the Administrative Agent and/or the Lenders and/or the Issuing Bank as successors to the Borrower) to be in compliance with such Environmental Laws.
(b)
The Borrower's indemnification obligations under this Section shall apply to all Indemnity Proceedings arising out of, or related to, the foregoing whether or not an Indemnified Party is a named party in such Indemnity Proceeding. In this connection, this indemnification shall cover all Indemnified Costs of any Indemnified Party in connection with any deposition of any Indemnified Party or compliance with any subpoena (including any subpoena requesting the production of documents). This indemnification shall, among other things, apply to any Indemnity Proceeding commenced by other creditors of the Borrower or any Subsidiary, any shareholder of the Borrower or any Subsidiary (whether such shareholder(s) are prosecuting such Indemnity Proceeding in their individual capacity or derivatively on behalf of the Borrower), any account debtor of the Borrower or any Subsidiary or by any Governmental Authority.
(c)
This indemnification shall apply to any Indemnity Proceeding arising during the pendency of any bankruptcy proceeding filed by or against the Borrower and/or any Subsidiary.
(d)
All out-of-pocket fees and expenses of, and all amounts paid to third-persons by, an Indemnified Party shall be advanced by the Borrower at the request of such Indemnified Party notwithstanding any claim or assertion by the Borrower that such Indemnified Party is not entitled to indemnification hereunder upon receipt of an undertaking by such Indemnified Party that such Indemnified Party will reimburse the Borrower if it is actually and finally determined by a court of competent jurisdiction that such Indemnified Party is not so entitled to indemnification hereunder. Each Indemnified Party shall use its reasonable efforts to give Borrower as much advance notice of anticipated fees, expenses and costs as is reasonably practicable under the circumstances, but failure to give such notice shall not absolve Borrower of Borrower's obligation to pay the same.
(e)
An Indemnified Party may conduct its own investigation and defense of, and may formulate its own strategy with respect to, any Indemnity Proceeding covered by this Section and, as provided above, all Indemnified Costs incurred by such Indemnified Party shall be reimbursed by the Borrower. No action taken by legal counsel chosen by an Indemnified Party in investigating or defending against any such Indemnity Proceeding shall vitiate or in any way impair the obligations and duties of the Borrower hereunder to indemnify and hold harmless each such Indemnified Party; provided, however, that (i) if the Borrower is required to indemnify an Indemnified Party pursuant hereto and (ii) the Borrower has provided evidence reasonably satisfactory to such Indemnified Party that the Borrower has the financial wherewithal to reimburse such Indemnified Party for any amount paid by such Indemnified Party with respect to such Indemnity Proceeding, such Indemnified Party shall not settle or compromise any such Indemnity Proceeding without the prior written consent of the Borrower (which consent shall not be unreasonably withheld or delayed). Notwithstanding the foregoing, an Indemnified Party may settle or compromise any such Indemnity Proceeding without the prior written consent of the Borrower
where (x) no monetary relief is sought against such Indemnified Party in such Indemnity Proceeding or (y) there is an allegation of a violation of law by such Indemnified Party.
(f)
If and to the extent that the obligations of the Borrower hereunder are unenforceable for any reason, the Borrower hereby agrees to make the maximum contribution to the payment and satisfaction of such obligations which is permissible under Applicable Law.
(g)
Subject to the immediately following Section 13.11., the Borrower's obligations hereunder shall survive any termination of this Agreement and the other Loan Documents and the payment in full in cash of the Obligations, and are in addition to, and not in substitution of, any of the other obligations set forth in this Agreement or any other Loan Document to which it is a party.
References in this Section 13.10. to “Lender” or “Lenders” shall be deemed to include such Persons (and their Affiliates) in their capacity as Specified Derivatives Providers.
Section 13.11.
Termination; Survival.
At such time as (a) all of the Commitments have been terminated, (b) all Letters of Credit have terminated or expired or been cancelled, (c) none of the Lenders is obligated any longer under this Agreement to make any Loans and no Issuing Bank is obligated any longer under this Agreement to issue Letters of Credit and (d) all Obligations (other than obligations which survive as provided in the following sentence) have been paid and satisfied in full, this Agreement shall terminate. The indemnities to which the Administrative Agent, the Issuing Bank and the Lenders are entitled under the provisions of Sections 3.10., 5.1., 5.4., 12.8., 13.2. and 13.10. and any other provision of this Agreement and the other Loan Documents, and the provisions of Section 13.5., shall continue in full force and effect and shall protect the Administrative Agent, the Issuing Bank and the Lenders (i) notwithstanding any termination of this Agreement, or of the other Loan Documents, against events arising after such termination as well as before and (ii) at all times after any such party ceases to be a party to this Agreement with respect to all matters and events existing on or prior to the date such party ceased to be a party to this Agreement.
Section 13.12.
Severability of Provisions.
If any provision under this Agreement or the other Loan Documents shall be determined by a court of competent jurisdiction to be invalid or unenforceable, that provision shall be deemed severed from the Loan Documents, and the validity, legality and enforceability of the remaining provisions shall remain in full force as though the invalid, illegal, or unenforceable provision had never been part of the Loan Documents.
Section 13.13.
GOVERNING LAW.
THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO CONTRACTS EXECUTED, AND TO BE FULLY PERFORMED, IN SUCH STATE.
Section 13.14.
Counterparts.
To facilitate execution, this Agreement and any amendments, waivers, consents or supplements may be executed in any number of counterparts as may be convenient or required (which may be effectively delivered by facsimile, in portable document format (“PDF”) or other similar electronic means). It shall not be necessary that the signature of, or on behalf of, each party, or that the signature of
all persons required to bind any party, appear on each counterpart. All counterparts shall collectively constitute a single document. It shall not be necessary in making proof of this document to produce or account for more than a single counterpart containing the respective signatures of, or on behalf of, each of the parties hereto.
Section 13.15.
Obligations with Respect to Loan Parties.
The obligations of the Borrower to direct or prohibit the taking of certain actions by the Parent or the other Loan Parties as specified herein shall be absolute and not subject to any defense the Borrower may have that the Borrower does not control the Parent or such Loan Parties.
Section 13.16.
Independence of Covenants.
All covenants hereunder shall be given in any jurisdiction independent effect so that if a particular action or condition is not permitted by any of such covenants, the fact that it would be permitted by an exception to, or be otherwise within the limitations of, another covenant shall not avoid the occurrence of a Default or an Event of Default if such action is taken or condition exists.
Section 13.17.
Limitation of Liability.
None of the Administrative Agent, the Issuing Bank or any Lender, or any affiliate, officer, director, employee, attorney, or agent of the Administrative Agent, the Issuing Bank or any Lender shall have any liability with respect to, and the Borrower and the Parent hereby waive, release, and agree not to sue any of them upon, any claim for any special, indirect, incidental, or consequential damages suffered or incurred by the Borrower or the Parent in connection with, arising out of, or in any way related to, this Agreement, any of the other Loan Documents or the Fee Letter, or any of the transactions contemplated by this Agreement or any of the other Loan Documents. The Borrower and the Parent hereby waive, release, and agree not to sue the Administrative Agent, the Issuing Bank or any Lender or any of the Administrative Agent's, the Issuing Bank's or any Lender's affiliates, officers, directors, employees, attorneys, or agents for punitive damages in respect of any claim in connection with, arising out of, or in any way related to, this Agreement, any of the other Loan Documents, the Fee Letter, or any of the transactions contemplated by this Agreement or financed hereby.
Section 13.18.
Entire Agreement.
This Agreement, the Notes, the other Loan Documents and the Fee Letter embody the final, entire agreement among the parties hereto and supersede any and all prior commitments, agreements, representations, and understandings, whether written or oral, relating to the subject matter hereof and thereof and may not be contradicted or varied by evidence of prior, contemporaneous, or subsequent oral agreements or discussions of the parties hereto. There are no oral agreements among the parties hereto.
Section 13.19.
Construction, Conflict of Terms.
The Administrative Agent, the Issuing Bank, the Borrower, the Parent and each Lender acknowledge that each of them has had the benefit of legal counsel of its own choice and has been afforded an opportunity to review this Agreement and the other Loan Documents with its legal counsel and that this Agreement and the other Loan Documents shall be construed as if jointly drafted by the Administrative Agent, the Issuing Bank, the Borrower, each Lender and the Parent. In the event of a conflict between the terms and provisions of this Agreement and the terms and provisions of any of the other Loan Documents, the terms of this Agreement shall govern.
Section 13.20.
Headings.
The paragraph and section headings in this Agreement are provided for convenience of reference only and shall not affect its construction or interpretation.
Section 13.21.
Limitation of Liability of Borrower's General Partner.
Subject to the exceptions and qualifications described below, the General Partner, shall not be personally liable for the payment of the Obligations. Notwithstanding the foregoing: (a) if an Event of Default occurs, nothing contained herein shall in any way prevent or hinder the Administrative Agent or the Lenders in the pursuit or enforcement of any right, remedy or judgment against the Borrower or any other Loan Party, or any of their respective assets; and (b) the General Partner shall be fully liable to the Administrative Agent and the Lenders to the same extent that the General Partner would be liable absent the foregoing provisions of this Section for fraud or willful misrepresentation by the Borrower, the General Partner, its or their Affiliates or predecessor general partner (
i.e.
, the Parent), (to the full extent of losses suffered by the Administrative Agent or any Lender by reason of such fraud or willful misrepresentations).
Section 13.22.
Limited Nature of Parent's Obligations.
THE LENDERS AND THE ADMINISTRATIVE AGENT ACKNOWLEDGE AND AGREE THAT THE PARENT IS JOINING IN THE EXECUTION OF THIS AGREEMENT SOLELY FOR THE LIMITED PURPOSE OF BEING BOUND BY THE TERMS OF THE SECTIONS SPECIFICALLY APPLICABLE TO THE PARENT, INCLUDING SECTIONS 8.1., 8.2., 8.6, 8.7., 8.12., 8.13., 9.6., 10.1., 10.4., 10.6., and 10.7. OF THIS AGREEMENT. THE PARTIES HERETO ACKNOWLEDGE AND AGREE THAT THE OCCURRENCE OF ANY DEFAULT OR EVENT OF DEFAULT UNDER THIS AGREEMENT OR OTHER LOAN DOCUMENT RESULTING FROM A BREACH BY THE PARENT OF, OR A MISREPRESENTATION BY THE PARENT UNDER OR IN ANY WAY RELATING TO, ANY OF SUCH SECTIONS SHALL NOT CREATE ANY PERSONAL LIABILITY ON THE PART OF THE PARENT FOR THE PAYMENT OF THE OBLIGATIONS. NOTHING CONTAINED IN THIS SECTION IS INTENDED TO LIMIT THE OBLIGATIONS OF THE PARENT UNDER THE PARENT GUARANTY.
Section 13.23.
Limitation of Liability of Borrower's Directors, Officers, Etc.
The parties hereto acknowledge and agree that no director, officer, shareholder, employee or agent of the Borrower or any Affiliate of the Borrower shall be held to any personal liability, jointly or severally, for any obligation of, or claim against, the Borrower.
Section 13.24.
AMENDMENT, RESTATEMENT AND CONSOLIDATION; NO NOVATION.
THE EXISTING CREDIT AGREEMENT IS BEING AMENDED, RESTATED AND CONSOLIDATED IN ITS ENTIRETY BY THIS AGREEMENT FOR THE CONVENIENCE OF THE PARTIES. THIS AGREEMENT MERELY AMENDS, MODIFIES, RESTATES AND CONSOLIDATES THE INDEBTEDNESS, LIABILITIES AND OBLIGATIONS EVIDENCED BY THE EXISTING CREDIT AGREEMENT AND THE OTHER LOAN DOCUMENTS (AS DEFINED IN THE EXISTING CREDIT AGREEMENT) AND DOES NOT CONSTITUTE, AND IT IS THE EXPRESS INTENT OF THE PARTIES HERETO THAT THIS AGREEMENT DOES NOT EFFECT, A NOVATION OF THE EXISTING INDEBTEDNESS, LIABILITIES AND OBLIGATIONS OWING BY
THE BORROWER PRUSUANT TO THE EXISTING CREDIT AGREEMENT. ALL SUCH INDEBTEDNESS, LIABILITIES AND OBLIGATIONS CONTINUE TO REMAIN OUTSTANDING AND EVIDENCED BY THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS. THE AMENDMENT, RESTATEMENT AND CONSOLIDATION EFFECTED HEREBY SHALL BE DEEMED TO HAVE PROSPECTIVE APPLICATION ONLY FROM AND AFTER THE EFFECTIVE DATE, UNLESS OTHERWISE EXPRESSLY STATED HEREIN.
IN WITNESS WHEREOF, the parties hereto have caused this Eighth Amended and Restated Credit Agreement to be executed by their authorized officers all as of the day and year first above written.
BORROWER:
CBL & ASSOCIATES LIMITED PARTNERSHIP
By: CBL Holdings I, Inc., its sole general partner
|
|
|
|
By:
|
/s/ Farzana K. Mitchell
|
|
Name:
|
Farzana K. Mitchell
|
|
Title:
|
Executive Vice President & CFO
|
PARENT:
CBL & ASSOCIATES PROPERTIES, INC., solely for the limited purposes set forth in Section 13.22.
|
|
|
|
By:
|
/s/ Farzana K. Mitchell
|
|
Name:
|
Farzana K. Mitchell
|
|
Title:
|
Executive Vice President & CFO
|
[
Signatures Continued on Next Page
]
[
Signature Page to Eighth Amended and Restated Credit Agreement
]
WELLS FARGO BANK, NATIONAL ASSOCIATION, as Administrative Agent and as a Lender
|
|
|
|
By:
|
/s/ Sam Supple
|
|
Name:
|
Sam Supple
|
|
Title:
|
Senior Vice President
|
[
Signatures Continued on Following Page
]
[
Signature Page to Eighth Amended and Restated Credit Agreement
]
U.S. BANK NATIONAL ASSOCIATION,
as Syndication Agent and as a Lender
|
|
|
|
By:
|
/s/ Michael Raarup
|
|
Name:
|
Michael Raarup
|
|
Title:
|
Senior Vice President
|
[
Signatures Continued on Following Page
]
[
Signature Page to Eighth Amended and Restated Credit Agreement
]
BANK OF AMERICA, N.A.,
as a Documentation Agent and as a Lender
|
|
|
|
By:
|
/s/ Lissette Rivera-Pauley
|
|
Name:
|
Lissette Rivera-Pauley
|
|
Title:
|
Senior Vice President
|
[
Signatures Continued on Following Page
]
[
Signature Page to Eighth Amended and Restated Credit Agreement
]
KEYBANK NATIONAL ASSOCIATION,
as a Documentation Agent and as a Lender
|
|
|
|
By:
|
/s/ Michael P. Szuba
|
|
Name:
|
Michael P. Szuba
|
|
Title:
|
Vice President
|
[
Signatures Continued on Following Page
]
[
Signature Page to Eighth Amended and Restated Credit Agreement
]
JPMORGAN CHASE BANK, N.A.,
as a Documentation Agent and as a Lender
|
|
|
|
By:
|
/s/ Elizabeth R. Johnson
|
|
Name:
|
Elizabeth R. Johnson
|
|
Title:
|
Senior Credit Banker
|
[
Signatures Continued on Following Page
]
[
Signature Page to Eighth Amended and Restated Credit Agreement
]
PNC BANK, NATIONAL ASSOCIATION,
as a Documentation Agent and as a Lender
|
|
|
|
By:
|
/s/ Andrew T. White
|
|
Name:
|
Andrew T. White
|
|
Title:
|
Senior Vice President
|
[
Signatures Continued on Following Page
]
[
Signature Page to Eighth Amended and Restated Credit Agreement
]
REGIONS BANK,
as a Lender
|
|
|
|
By:
|
/s/ Lori Chambers
|
|
Name:
|
Lori Chambers
|
|
Title:
|
Vice President
|
[
Signatures Continued on Following Page
]
[
Signature Page to Eighth Amended and Restated Credit Agreement
]
ROYAL BANK OF CANADA,
as a Lender
|
|
|
|
By:
|
/s/ Brian Gross
|
|
Name:
|
Brian Gross
|
|
Title:
|
Authorized Signatory
|
[
Signatures Continued on Following Page
]
[
Signature Page to Eighth Amended and Restated Credit Agreement
]
UNION BANK, N.A.,
as a Lender
|
|
|
|
By:
|
/s/ Mark Dunn
|
|
Name:
|
Mark Dunn
|
|
Title:
|
Vice President
|
[
Signatures Continued on Following Page
]
[
Signature Page to Eighth Amended and Restated Credit Agreement
]
BRANCH BANKING AND TRUST COMPANY,
as a Lender
|
|
|
|
By:
|
/s/ Ahaz A. Armstrong
|
|
Name:
|
Ahaz A. Armstrong
|
|
Title:
|
Assistant Vice President
|
[
Signatures Continued on Following Page
]
[
Signature Page to Eighth Amended and Restated Credit Agreement
]
FIFTH THIRD BANK,
as a Lender
|
|
|
|
By:
|
/s/ John H. Reynolds
|
|
Name:
|
John H. Reynolds
|
|
Title:
|
Vice President
|
[
Signatures Continued on Following Page
]
[
Signature Page to Eighth Amended and Restated Credit Agreement
]
RAYMOND JAMES BANK, N.A.,
as a Lender
|
|
|
|
By:
|
/s/ James M. Armstrong
|
|
Name:
|
James M. Armstrong
|
|
Title:
|
Senior Vice President
|
[
Signatures Continued on Following Page
]
[
Signature Page to Eighth Amended and Restated Credit Agreement
]
MIDFIRST BANK,
as a Lender
|
|
|
|
By:
|
/s/ Darrin Rigler
|
|
Name:
|
Darrin Rigler
|
|
Title:
|
Vice President
|
[
End of Signatures
]
SCHEDULE I
Commitments
|
|
|
Lender
|
Commitment
|
|
|
Wells Fargo Bank, National Association
|
$125,000,000
|
|
|
U.S. Bank National Association
|
$105,000,000
|
|
|
Bank of America, N.A.
|
$75,000,000
|
|
|
KeyBank National Association
|
$60,000,000
|
|
|
JPMorgan Chase Bank, N.A.
|
$50,000,000
|
|
|
PNC Bank, National Association
|
$50,000,000
|
|
|
Regions Bank
|
$30,000,000
|
|
|
Royal Bank of Canada
|
$25,000,000
|
|
|
Union Bank, N.A.
|
$25,000,000
|
|
|
Branch Banking and Trust Company
|
$20,000,000
|
|
|
Fifth Third Bank
|
$17,500,000
|
|
|
Raymond James Bank, N.A.
|
$10,000,000
|
|
|
MidFirst Bank
|
$7,500,000
|
SCHEDULE 1.1
Permitted Liens
• Liens on the Borrower's Property known as Foothills Mall and related assets, and cash collateral delivered in substitution therefor, which Liens secure the Borrower's obligations under that certain Loan Agreement (Letter of Credit Facility), entered into December 19, 2001, by and among Regions Bank, Borrower, Parent, and certain subsidiaries of Borrower (as amended or otherwise modified from time to time, the “Regions LC Facility”), solely to the extent the aggregate obligations (contingent or otherwise) under the Regions LC Facility do not currently and shall not exceed $13,000,000.00.
SCHEDULE 7.1.(b)
Ownership Structure
SCHEDULE 7.1.(b) - PART I
Loan Parties, Limited Subsidiaries and Equity Interests
* Entities shown in bold are Guarantors
CBL & Associates Properties, Inc. (Delaware)
CBL & Associates Limited Partnership (Delaware)
CBL Holdings I, Inc. (Delaware) - 1% general partnership interest
CBL & Associates Properties, Inc. - 100% common stock
CBL Holdings II, Inc. (Delaware) - 83% limited partnership interest
CBL & Associates Properties, Inc. - 100% common stock
Other Limited Partners - 16% limited partnership interest
Acadiana Expansion Parcel, LLC (Louisiana)
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
Acadiana Mall of Delaware, LLC (Delaware)
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
Alamance Crossing, LLC (North Carolina)
CBL & Associates Limited Partnership - 100% membership interest
Bonita Lakes Mall Limited Partnership (Mississippi)
CBL/GP III, Inc. (Mississippi) - 1% general partnership interest
CBL & Associates Management, Inc. (Delaware) - 100% common stock
CBL & Associates Limited Partnership (Delaware) - 99% limited partnership interest
CBL/Low Limited Partnership (Wyoming)
CBL/GP, Inc. (Wyoming) - 1% general partnership interest
CBL & Associates Management, Inc. (Delaware) - 100% common stock
CBL & Associates Limited Partnership (Delaware) - 99% limited partnership interest
Brookfield Square Parcel, LLC (Wisconsin)
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
Akron Mall Land, LLC (Delaware)
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
Columbia Place/Anchor, LLC (South Carolina)
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
The Courtyard at Hickory Hollow Limited Partnership (Delaware)
Hickory Hollow Courtyard, Inc. (Delaware) - 1% general partnership interest
CBL & Associates Limited Partnership (Delaware) - 99% limited partnership interest
Eastgate Company (Ohio)
CBL/Eastgate I, LLC (Delaware) - 53.8475% general partnership interest
CBL/J II, LLC (Delaware) - 100% membership interest
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
CBL/Eastgate II, LLC (Delaware) - 46.1525% general partnership interest
CBL/J II, LLC (Delaware) - 100% membership interest
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
CBL/Eastgate I, LLC (Delaware)
CBL/J II, LLC (Delaware) - 100% membership interest
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
CBL/Eastgate II, LLC (Delaware)
CBL/J II, LLC (Delaware) - 100% membership interest
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
CBL/J II, LLC (Delaware)
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
FHM Anchor, LLC (Tennessee)
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
Frontier Mall Associates Limited Partnership (Wyoming)
CBL & Associates Limited Partnership (Delaware) - 99.9% general partnership interest
CBL & Associates Properties, Inc. (Delaware) - .1% limited partnership interest
Georgia Square Partnership (Georgia)
CBL & Associates Limited Partnership (Delaware) - 99.9% general partnership interest
CBL & Associates Properties, Inc. (Delaware) - .1% limited partnership interest
Georgia Square Associates, Ltd. (Georgia)
CBL & Associates Limited Partnership (Delaware) - 99.9% general partnership interest
CBL & Associates Properties, Inc. (Delaware) - .1% limited partnership interest
Harford Mall Business Trust (Maryland)
CBL/Nashua Limited Partnership (New Hampshire) - 100% ownership interest
CBL & Associates Limited Partnership (Delaware) - 99.9209% general partnership interest
CBL & Associates Properties, Inc. (Delaware) - .0791% limited partnership interest
CBL/Nashua Limited Partnership (New Hampshire)
CBL & Associates Limited Partnership (Delaware) - 99.9209% general partnership interest
CBL & Associates Properties, Inc. (Delaware) - .0791% limited partnership interest
Lakeshore/Sebring Limited Partnership (Florida)
CBL & Associates Limited Partnership (Delaware) - 99.9% general partnership interest
CBL & Associates Properties, Inc. (Delaware) - .1% limited partnership interest
Madison Plaza Associates, LTD (Alabama)
CBL & Associates Limited Partnership (Delaware) - 75% general partnership interest
CBL & Associates Limited Partnership (Delaware) - 24.9% limited partnership interest
CBL/Huntsville, LLC (Delaware) - .1% limited partnership interest
CBL & Associates Limited Partnership - 100% membership interest
Madison Square Associates, Ltd. (Alabama)
CBL & Associates Limited Partnership (Delaware) - 49.9% general partnership interest
CBL & Associates Limited Partnership (Delaware) - 50% limited partnership interest
CBL/Huntsville, LLC (Delaware) - .1% limited partnership interest
CBL & Associates Limited Partnership - 100% membership interest
CBL/Huntsville, LLC (Delaware)
CBL & Associates Limited Partnership - 100% membership interest
Meridian Mall Limited Partnership (Michigan)
Meridian Mall Company, Inc. (Michigan) - 1% general partnership interest
CBL & Associates Management, Inc. (Delaware) - 100% common stock
CBL & Associates Limited Partnership (Delaware) - 99% limited partnership interest
CBL/ Monroeville Partner, L.P. (Pennsylvania)
CBL/Monroeville II, LLC (Pennsylvania) - .5% general partnership interest
CBL & Associates Limited Partnership - 100% membership interest
CBL/Monroeville III, LLC (Pennsylvania) - 99.5% limited partnership interest
CBL & Associates Limited Partnership - 100% membership interest
CBL/Monroeville II, LLC (Pennsylvania)
CBL & Associates Limited Partnership - 100% membership interest
CBL/Monroeville III, LLC (Pennsylvania)
CBL & Associates Limited Partnership - 100% membership interest
CBL/Monroeville, L.P. (Pennsylvania)
CBL/Monroeville I, LLC (Delaware) - .5% general partnership interest
CBL & Associates Limited Partnership - 100% membership interest
CBL/ Monroeville Partner, L.P. (Pennsylvania) - 99.5% limited partnership interest
CBL/Monroeville II, LLC (Pennsylvania) - .5% general partnership interest
CBL & Associates Limited Partnership - 100% membership interest
CBL/Monroeville III, LLC (Pennsylvania) - 99.5% limited partnership interest
CBL & Associates Limited Partnership - 100% membership interest
CBL/Monroeville I, LLC (Delaware)
CBL & Associates Limited Partnership - 100% membership interest
Monroeville Anchor Limited Partnership (Pennsylvania)
CBL/Monroeville II, LLC (Pennsylvania) - .5% general partnership interest
CBL & Associates Limited Partnership - 100% membership interest
CBL/Monroeville III, LLC (Pennsylvania) - 99.5% limited partnership interest
CBL & Associates Limited Partnership - 100% membership interest
Hixson Mall, LLC (Tennessee)
CBL & Associates Limited Partnership - 100% membership interest
Old Hickory Mall Venture II, LLC (Delaware)
Old Hickory Mall Venture (Tennessee) - 99.5% membership interest
CBL/Old Hickory I, LLC (Delaware) - 95% general partnership interest
CBL/J II, LLC (Delaware) - 100% membership interest
CBL & Associates Limited Partnership - 100% membership interest
CBL/Old Hickory II, LLC (Delaware) - 5% general partnership interest
CBL/J II, LLC (Delaware) - 100% membership interest
CBL & Associates Limited Partnership - 100% membership interest
CBL Old Hickory Mall, Inc. (Tennessee) - .5% membership interest
Old Hickory Mall Venture (Tennessee)
CBL/Old Hickory I, LLC (Delaware) - 95% general partnership interest
CBL/J II, LLC (Delaware) - 100% membership interest
CBL & Associates Limited Partnership - 100% membership interest
CBL/Old Hickory II, LLC (Delaware) - 5% general partnership interest
CBL/J II, LLC (Delaware) - 100% membership interest
CBL & Associates Limited Partnership - 100% membership interest
CBL/Old Hickory I, LLC (Delaware)
CBL/J II, LLC (Delaware) - 100% membership interest
CBL & Associates Limited Partnership - 100% membership interest
CBL/Old Hickory II, LLC (Delaware)
CBL/J II, LLC (Delaware) - 100% membership interest
CBL & Associates Limited Partnership - 100% membership interest
Panama City Mall, LLC (Delaware)
CBL & Associates Limited Partnership - 100% membership interest
Willowbrook Plaza Limited Partnership (Maine)
CBL/GP, Inc. (Wyoming) - 1% general partnership interest
CBL & Associates Management, Inc. (Delaware) - 100% common stock
CBL & Associates Limited Partnership (Delaware) - 99% limited partnership interest
Port Orange Holdings II, LLC (Florida)
The Pavilion at Port Orange, LLC (Florida) - 100% membership interest
CBL & Associates Limited Partnership (Delaware) - 91.09% membership interest
CBL & Associates Management, Inc. (Delaware) - 9.91 % membership interest
College Station Partners, Ltd. (Texas)
CBL & Associates Limited Partnership (Delaware) - 99.9% membership interest
CBL & Associates Properties, Inc. (Delaware) - .1% membership interest
POM-College Station, LLC (Texas)
CBL & Associates Limited Partnership (Delaware) - 99.9% membership interest
CBL & Associates Properties, Inc. (Delaware) - .1% membership interest
JG Randolph II, LLC (Delaware)
JG Randolph, LLC (Ohio) - 100% membership interest
CBL/J II, LLC (Delaware) - 100% membership interest
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
JG Randolph, LLC (Ohio)
CBL/J II, LLC (Delaware) - 100% membership interest
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
Racine Joint Venture II, LLC (Delaware)
Racine Joint Venture (Ohio) - (100% membership interest)
CBL/Regency I, LLC (Delaware) - 74.1% general partnership interest
CBL/J II, LLC (Delaware) - 100% membership interest
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
CBL/Regency II, LLC (Delaware) - 25.9% general partnership interest
CBL/J II, LLC (Delaware) - 100% membership interest
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
Racine Joint Venture (Ohio)
CBL/Regency I, LLC (Delaware) - 74.1% general partnership interest
CBL/J II, LLC (Delaware) - 100% membership interest
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
CBL/Regency II, LLC (Delaware) - 25.9% general partnership interest
CBL/J II, LLC (Delaware) - 100% membership interest
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
CBL/Regency I, LLC (Delaware)
CBL/J II, LLC (Delaware) - 100% membership interest
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
CBL/Regency II, LLC (Delaware)
CBL/J II, LLC (Delaware) - 100% membership interest
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
CBL RM-Waco, LLC (Texas)
CBL/Richland G.P., LLC (Texas) - .5% membership interest
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
CBL & Associates Limited Partnership (Delaware) - 99.5% membership interest
CBL/Richland G.P., LLC (Texas)
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
River Ridge Mall, LLC (Virginia)
Seacoast Shopping Center Limited Partnership (New Hampshire) - 100% membership interest
CBL & Associates Limited Partnership (Delaware) - 99.92% general partnership interest
CBL & Associates Properties, Inc. (Delaware) - .08% limited partnership interest
Seacoast Shopping Center Limited Partnership (New Hampshire)
CBL & Associates Limited Partnership (Delaware) - 99.92% general partnership interest
CBL & Associates Properties, Inc. (Delaware) - .08% limited partnership interest
Rivergate Mall Limited Partnership (Delaware)
Rivergate Mall, Inc. (Delaware) - 1% general partnership interest
CBL & Associates Limited Partnership (Delaware) - 99% limited partnership interest
The Village at Rivergate Limited Partnership (Delaware)
The Village at Rivergate, Inc. (Delaware) - 1% general partnership interest
CBL & Associates Limited Partnership (Delaware) - 99% limited partnership interest
Hickory Point-OP Outparcel, LLC (Illinois)
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
The Shoppes at Panama City, LLC (Florida)
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
CBL SM-Brownsville, LLC (Texas)
CBL/Sunrise GP, LLC (Delaware) - .5% membership interest
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
CBL & Associates Limited Partnership (Delaware) - 99.5% membership interest
CBL/Sunrise GP, LLC (Delaware)
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
CBL/Sunrise Commons, L.P. (Texas)
CBL/Sunrise Commons GP, LLC (Texas) - .5% general partnership interest
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
CBL & Associates Limited Partnership (Delaware) - 99.5% limited partnership interest
CBL/Sunrise Commons GP, LLC (Texas)
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
CBL/Sunrise XS Land, L.P. (Texas)
CBL/Sunrise Land, LLC (Texas) - .5% general partnership interest
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
CBL & Associates Limited Partnership (Delaware) - 99.5% limited partnership interest
CBL/Sunrise Land, LLC (Texas)
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
CBL/Monroeville Expansion, L.P. (Pennsylvania)
CBL/Monroeville Expansion I, LLC (Pennsylvania) - .5% general partnership interest
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
CBL/Monroeville Expansion Partner, L.P. (Pennsylvania) - 99.5% limited partnership interest
CBL/Monroeville Expansion II, LLC (Pennsylvania) - .5% general partnership interest
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
CBL/Monroeville Expansion III, LLC (Pennsylvania) - 99.5% limited partnership interest
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
CBL/Monroeville Expansion I, LLC (Pennsylvania)
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
CBL/Monroeville Expansion Partner, L.P. (Pennsylvania)
CBL/Monroeville Expansion II, LLC (Pennsylvania) - .5% general partnership interest
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
CBL/Monroeville Expansion III, LLC (Pennsylvania) - 99.5% limited partnership interest
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
CBL/Monroeville Expansion II, LLC (Pennsylvania)
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
CBL/Monroeville Expansion III, LLC (Pennsylvania)
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
The Landing at Arbor Place II, LLC (Delaware)
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
Turtle Creek Limited Partnership (Mississippi)
CBL & Associates Limited Partnership (Delaware) - 99.9% general partnership interest
CBL & Associates Properties, Inc. (Delaware) - .1% limited partnership interest
CBL Walden Park, LLC (Texas)
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
WNC Shopping Center, LLC (North Carolina)
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
Madison Joint Venture (Ohio)
CBL/Madison I, LLC (Delaware) - 65% general partnership interest
CBL/J I, LLC (Delaware) - 100% membership interest
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
CBL/Madison II, LLC (Delaware) - 35% general partnership interest
CBL/J I, LLC (Delaware) - 100% membership interest
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
CBL/Madison I, LLC (Delaware)
CBL/J I, LLC (Delaware) - 100% membership interest
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
CBL/Madison II, LLC (Delaware)
CBL/J I, LLC (Delaware) - 100% membership interest
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
CBL/J I, LLC (Delaware)
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
Westgate Crossing Limited Partnership (South Carolina)
CBL/GP II, Inc. (Wyoming) - 1% general partnership interest
CBL & Associates Management, Inc. (Delaware) - 100% common stock
CBL & Associates Limited Partnership - 99% limited partnership interest
Houston Willowbrook, LLC (Texas)
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
CBL El Paso Member, LLC (Delaware)
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
Parkdale Mall, LLC (Texas)
CBL/Parkdale Mall GP, LLC (Delaware) - .05% membership interest
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
Parkdale Mall Associates, L.P. (Texas) - 99.95 % membership interest
CBL/Parkdale, LLC (Texas) - .05% general partnership interest
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
CBL & Associates Limited Partnership (Delaware) - 99.95% limited partnership interest
CBL/Parkdale Mall GP, LLC
(Delaware)
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
Parkdale Mall Associates, L.P. (Texas)
CBL/Parkdale, LLC (Texas) - .05% general partnership interest
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
CBL & Associates Limited Partnership (Delaware) - 99.95% limited partnership interest
CBL/Parkdale, LLC (Texas)
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
IV Commons, LLC (California)
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
Jefferson Mall Company II, LLC (Delaware)
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
Pearland-OP Parcel 8, LLC (Texas)
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
Southpark Mall-DSG, LLC (Virginia)
CBL & Associates Limited Partnership (Delaware) - 100% membership interest
CBL Gettysburg Member, LLC (Delaware)
CBL & Associates Limited Partnership - 100% membership interest
CBL-TRS Member I, LLC (Delaware)
CBL & Associates Limited Partnership - 100% membership interest
CBL/MSC, LLC
(South Carolina)
CBL & Associates Limited Partnership - 100% membership interest
CBL/Gulf Coast, LLC (Florida)
CBL & Associates Limited Partnership - 100% membership interest
Laurel Park Retail Properties, LLC (Delaware)
Laurel Park Retail Holdings, LLC (Delaware) - 100% membership interest
CBL & Associates Limited Partnership - 70% membership interest
Shostak Laurel Park Retail Holding LLC - 30% membership interest
SCHEDULE 7.1.(b) - PART II
Non-Loan Party Borrower Affiliates Owning
Assets Included in Unencumbered Asset Value
Non-Guarantor Wholly Owned Subsidiaries
CBL & Associates Management, Inc.
, a Delaware corporation
CBL & Associates Limited Partnership - 100% ownership interest
CBL Sunday Drive, LLC
, a North Carolina limited liability company
CBL & Associates Management, Inc. - 100% membership interest
CBL 840 GC, LLC
, a Virginia limited liability company
CBL & Associates Management, Inc. - 100% membership interest
CBL 850 GC, LLC
, a Virginia limited liability company
CBL & Associates Management, Inc. - 100% membership interest
CVPC Outparcels, LLC
, a Florida limited liability company
CBL & Associates Management, Inc. - 100% membership interest
Hickory Point Outparcels, LLC
, an Illinois limited liability company
CBL & Associates Management, Inc. - 100% membership interest
CBL-LP Office Building, LLC
, a North Carolina limited liability company
CBL & Associates Management, Inc. - 100% membership interest
CBL-OB Business Center, LLC
, a North Carolina limited liability company
CBL & Associates Management, Inc. - 100% membership interest
CBL One Oyster Point, LLC
, a Virginia limited liability company
CBL & Associates Management, Inc. - 100% membership interest
Pearland Hotel Operator, Inc.
, a Texas corporation
CBL & Associates Management, Inc. - 100% membership interest
CBL-PB Center I, LLC
, a Virginia limited liability company
CBL & Associates Management, Inc. - 100% membership interest
CBL-ST Building, LLC
, a North Carolina limited liability company
CBL & Associates Management, Inc. - 100% membership interest
CBL Two Oyster Point, LLC
, a Virginia limited liability company
CBL & Associates Management, Inc. - 100% membership interest
CBL Lee's Summit East, LLC
, a Delaware limited liability company
CBL & Associates Management, Inc. - 100% membership interest
Consolidated JV Entities
:
Imperial Valley Commons, L.P.
, a California limited partnership
CBL & Associates Limited Partnership - 59.5% limited partnership interest
IV Commons, LLC - .5% general partnership interest
CBL & Associates Limited Partnership - 100% membership interest
High Point Development Limited Partnership II,
a North Carolina limited partnership
CBL & Associates Limited Partnership - 74% limited partnership interest
CBL/GP, Inc. - 1% general partnership interest
Pearland Town Center Limited Partnership,
a Texas limited partnership
CBL/T-C, LLC - 99.5% limited partnership interest (JV Entity)
Pearland Town Center GP, LLC - 0.5% general partnership interest
CBL/T-C, LLC - 100% membership interest
CBL SubREIT, Inc. - 34.44% membership interest
CW Joint Venture, LLC - 85% ownership interest
CBL & Associates Limited Partnership - 55.56% membership interest
Arbor Place Limited Partnership - 12.17% membership interest
CBL & Associates Limited Partnership - 99% general partnership interest
Arbor Place GP, Inc. - 1% general partnership interest
St. Clair Square GP, Inc. - .16% membership interest
The Galleria Associates, L.P. - 20.33% membership interest
CBL & Associates Limited Partnership - 89.9% general partnership interest
CBL & Associates Properties, Inc. - .1% limited partnership
interest
Oak Park Holding I, LLC - 5.54% membership interest
CBL & Associates Limited Partnership - 99.5% membership interest
CBL SubREIT, Inc. - 0.5% membership interest
OK City JV, LLC
, a Delaware limited liability company
OK City Member, LLC - 75% membership interest
CBL & Associates Limited Partnership - 92.5% membership interest
CBL & Associates Management, Inc. - 7.5% membership interest
EL Paso Outlet Center II, LLC
, a Delaware limited liability company
CBL El Paso Member, LLC - 75% membership interest
CBL & Associates Limited Partnership - 100% membership interest
EL Paso Outlet Outparcels, LLC
, a Delaware limited liability company
CBL El Paso Outparcel Member, LLC - 50% membership interest
CBL & Associates Management, Inc. - 100% membership interest
Gettysburg Outlet Center, LLC
, a Delaware limited liability company
CBL Gettysburg Member, LLC - 50% membership interest
CBL & Associates Limited Partnership - 100% membership interest
Atlanta Outlet Outparcels, LLC
, a Delaware limited liability company
CBL Woodstock Outparcel Member, LLC - 75% membership interest
CBL & Associates Limited Partnership - 75% membership interest
CBL & Associates Management, Inc. - 25% membership interest
Lebcon Associates
, a Tennessee limited partnership
CBL & Associates Limited Partnership - 89.9% general partnership interest
CBL & Associates Limited Partnership - .1% limited partnership interest
Village at Orchard Hills, LLC
, a Michigan limited liability company
CBL & Associates Limited Partnership - 66% membership interest
Beltline Properties, LLC - 34% membership interest
Unconsolidated JV Entities
:
Governor's Square Company IB
, an Ohio general partnership
Montgomery Partners, L.P. - 50% general partnership interest
CBL & Associates Limited Partnership - 99% limited partnership interest
CBL/GP VI, Inc. - 1% general partnership interest
CBL-Shops at Friendly II, LLC
, a North Carolina limited liability company
CBL-TRS Member I, LLC - 50% membership interest in CBL-TRS Joint Venture, LLC, which is the Joint Venture that owns CBL-Shops at Friendly II, LLC
CBL & Associates Limited Partnership - 100% membership interest
Mall of South Carolina Limited Partnership
, a South Carolina limited
partnership
CBL & Associates Limited Partnership - 49% limited partnership interest
CBL/MSC, LLC - 1% general partnership interest
CBL & Associates Limited Partnership - 100% membership interest
GCTC Peripheral IV, LLC,
a Florida limited liability company
CBL/Gulf Coast, LLC - 50% membership interest in JG Gulf Coast Town Center LLC, which is the Joint Venture that owns GCTC Peripheral IV, LLC
CBL & Associates Limited Partnership - 100% membership interest
SCHEDULE 7.1.(f)
Occupancy Status of Properties
SCHEDULE 7.1.(f) - Part II
Eligible Properties
Property Description
Occupancy
Property
Rate
Classification
|
|
|
|
1500 Sunday Drive
|
84.2%
|
|
840 Greenbrier Circle
|
87%
|
|
850 Greenbrier Circle
|
100%
|
|
Acadiana Expansion Land
|
|
Land
|
Alamance Outparcel
|
|
Land
|
Bonita Crossing
|
97.2%
|
|
Bonita Lakes Mall
|
91.4%
|
|
Brookfield Square Lifestyle Center
|
100%
|
|
Chapel Hill Asso. Center
|
100%
|
|
Chapel Hill Vacant Land (RET Exp)
|
|
Land
|
Cobblestone at PC Outparcels
|
|
Land
|
Columbia JCP
|
49.7%
|
|
Courtyard at Hickory
|
98.2%
|
|
Douglasville, GA Outparcels 1
|
|
Land
|
Eastgate Land
|
|
Land
|
Foothills Carmike FHM Anchor
|
100%
|
Development
|
Foothills Plaza Expansion
|
100%
|
|
Frontier Mall
|
91.1%
|
|
Frontier Square
|
100%
|
|
Georgia Square
|
92.9%
|
|
Georgia Square Cinema
|
100%
|
|
Greenbriar Out parcel
|
|
Land
|
Harford Annex
|
100%
|
|
Harford Mall
|
99.3%
|
|
Hickory Point Outparcel
|
|
Land
|
Honey Creek OP
|
|
Land
|
J.C. Penney Maryville
|
100%
|
|
Jacksonville Regal Cinema Mgt
|
|
Land
|
Jefferson Mall Outparcels
|
|
Land
|
Lake Point Office B
|
94%
|
|
Lakeshore Mall
|
76.9%
|
|
Lansing, MI Land
|
|
Land
|
Laural Park Mall
|
97.9%
|
|
Lees Sumitt Land (CBL Mgmt Ops)
|
|
Land
|
Madison Plaza
|
59.7%
|
|
Madison Square
|
83.6%
|
|
Meridian Mall
|
89.3%
|
|
Monroeville
|
90.8%
|
|
Monroeville Mall Anchor
|
|
Development
|
Northgate Mall
|
81.1%
|
|
|
|
|
|
Oak Branch Bus. Center
|
77.1%
|
|
Old Hickory Mall
|
94%
|
|
One Oyster Point
|
24.5%
|
|
Panama City Mall
|
89.9%
|
|
Pearland Hotel
|
75.6%
|
|
Pearland Outparcel
|
|
Land
|
Pearland Residential
|
93.7%
|
|
Pemberton Plaza
|
81.1%
|
|
Peninsula Bus Center I
|
91.4%
|
|
Peninsula Bus Center II
|
100%
|
|
Port Orange FL West (CBL Mgmt Ops)
|
|
Land
|
Post Oak Mall
|
89.2%
|
|
Randolph Mall
|
85.9%
|
|
Regency Mall
|
89.6%
|
|
Richland Mall
|
96.4%
|
|
River Ridge
|
77.5%
|
|
Rivergate Mall
|
96.9%
|
|
Settler's Ridge Phase III Mgmt
|
|
Land
|
Shopps at Eastgate Cincinnati
|
|
Development
|
Shopps At Hickory Point
|
66.7%
|
|
Southaven Out Parcel
|
|
Land
|
Southpark - Dick's Sporting Goods
|
|
Land
|
Stillwater Outparcels
|
|
Land
|
Sunrise Commons
|
100%
|
|
Sunrise Excess Land
|
|
Land
|
Sunrise Mall
|
93.4%
|
|
SunTrust Bank Bldg
|
95.9%
|
|
The District @ Monroeville
|
95.2%
|
|
The Lakes OP 2
|
|
Land
|
The Landing @ Arbor Place
|
75.5%
|
|
The Landing Out Parcels1
|
|
Land
|
The Shoppes @ Panama City
|
96.2%
|
|
Township Property Land
|
—%
|
Land
|
Turtle Creek Mall
|
94%
|
|
Two Oyster Point
|
79.4%
|
|
Village at Rivergate
|
95.8%
|
|
Walden Park Austin TX
|
|
Land
|
Waynesville Comm Waynesville N
|
|
Development
|
West Towne Crossing
|
100%
|
|
Westgate Crossing
|
56.3%
|
|
Whitehall Station
|
|
Development
|
Willowbrook Plaza
|
72%
|
|
Willowbrook Land Houston TX 1
|
100%
|
|
SCHEDULE 7.1.(h)
Material Contracts
None.
SCHEDULE 7.1.(i)
Material Litigation
None.
SCHEDULE 7.1.(r)
Affiliate Transactions
None.
Schedule 8.14(c)
Parent Guaranties
• Guaranty Agreement dated December 30, 2011, by CBL & Associates Properties, Inc. and CBL & Associates Limited Partnership, in favor of Wells Fargo Bank, National Association, as Trustee and Administrative Agent for the Bondholders under Mississippi Business Finance Corporation Revenue Refunding Bonds, Series 2011A and Series 2011B, in the cumulative amount of $58,000,000.00.
• Guaranty Agreement dated December 19, 2001, by CBL & Associates Properties, Inc., in favor of Regions Bank, as additional security for that certain Loan Agreement (Letter of Credit Facility), entered into December 19, 2001, by and among Regions Bank and CBL & Associates Limited Partnership (and certain of its subsidiaries), as such Facility has been subsequently amended; provided that the Parent and the Borrower shall use commercially reasonable efforts to amend or otherwise modify or replace such Guaranty Agreement so that on or before the 90
th
day following the Agreement Date such Guaranty Agreement (or any replacement guaranty in respect thereof) shall provide rights and benefits not greater than the rights and benefits provided to the Administrative Agent and the Lenders pursuant to the Parent Guaranty.
• Guaranty Agreement dated June 8, 2012, by CBL & Associates Properties, Inc., in favor of First Tennessee Bank National Association as Administrative Agent, and for the benefit of the Lenders of that certain Amended and Restated Loan Agreement by and among CBL & Associates Limited Partnership and First Tennessee Bank National Association as Administrative Agent for the Lenders named therein; provided that the Parent and the Borrower shall use commercially reasonable efforts to amend or otherwise modify or replace such Guaranty Agreement so that on or before the 90
th
day following the Agreement Date such Guaranty Agreement (or any replacement guaranty in respect thereof) shall provide rights and benefits not greater than the rights and benefits provided to the Administrative Agent and the Lenders pursuant to the Parent Guaranty.
EXHIBIT A
FORM OF ASSIGNMENT AND ASSUMPTION AGREEMENT
THIS ASSIGNMENT AND ASSUMPTION AGREEMENT dated as of _______, 20__ (the “Agreement”) by and among _________________________ (the “Assignor”), _________________________ (the “Assignee”), CBL & Associates Limited Partnership (the “Borrower”), and WELLS FARGO BANK, NATIONAL ASSOCIATION, as Administrative Agent (the “Administrative Agent”).
WHEREAS, the Assignor is a Lender under that certain Eighth Amended and Restated Credit Agreement dated as of November 13, 2012 (as amended, restated, supplemented or otherwise modified from time to time, the “Credit Agreement”), by and among the Borrower, the financial institutions party thereto and their assignees under Section 13.6. thereof, the Administrative Agent, and the other parties thereto;
WHEREAS, the Assignor desires to assign to the Assignee all or a portion of the Assignor's Revolving Commitment under the Credit Agreement, all on the terms and conditions set forth herein; and
WHEREAS, the
[Borrower, the]
Swingline Lender, the Issuing Bank and the Administrative Agent consents to such assignment on the terms and conditions set forth herein.
NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which hereby are acknowledged by the parties hereto, the parties hereto hereby agree as follows:
Section 1.
Assignment
.
(a)
Subject to the terms and conditions of this Agreement and in consideration of the payment to be made by the Assignee to the Assignor pursuant to Section 2 of this Agreement, effective as of ____________, 20__ (the “Assignment Date”) the Assignor hereby irrevocably sells, transfers and assigns to the Assignee, without recourse, a $__________ interest (such interest being the “Assigned Commitment”) in and to the Assignor's Revolving Commitment, and all of the other rights and obligations of the Assignor under the Credit Agreement, such Assignor's Revolving Note, and the other Loan Documents representing ______% in respect of the aggregate amount of all Lenders' Revolving Commitments, including without limitation, a principal amount of outstanding Revolving Loans equal to $_________, all voting rights of the Assignor associated with the Assigned Commitment all rights to receive interest on such amount of Loans and all Fees with respect to the Assigned Commitment and other rights of the Assignor under the Credit Agreement and the other Loan Documents with respect to the Assigned Commitment, all as if the Assignee were an original Lender under and signatory to the Credit Agreement having a Revolving Commitment equal to the amount of the Assigned Commitment. The Assignee, subject to the terms and conditions hereof, hereby assumes all obligations of the Assignor with respect to the Assigned Commitment as if the Assignee were an original Lender under and signatory to the Credit Agreement having a Revolving Commitment equal to the Assigned Commitment, which obligations shall include, but shall not be limited to, the obligation
of the Assignor to make Revolving Loans to the Borrower with respect to the Assigned Commitment and the obligation to indemnify the Administrative Agent as provided in the Credit Agreement (the foregoing obligations, together with all other similar obligations more particularly set forth in the Credit Agreement and the other Loan Documents, shall be referred to hereinafter, collectively, as the “Assigned Obligations”). The Assignor shall have no further duties or obligations with respect to, and shall have no further interest in, the Assigned Obligations or the Assigned Commitment from and after the Assignment Date.
(b)
The assignment by the Assignor to the Assignee hereunder is without recourse to the Assignor. The Assignee makes and confirms to the Administrative Agent, the Assignor, and the other Lenders all of the representations, warranties and covenants of a Lender under Article XII of the Credit Agreement. Not in limitation of the foregoing, the Assignee acknowledges and agrees that, except as set forth in Section 4. below, the Assignor is making no representations or warranties with respect to, and the Assignee hereby releases and discharges the Assignor for any responsibility or liability for: (i) the present or future solvency or financial condition of the Borrower, any other Loan Party or any other Subsidiary, (ii) any representations, warranties, statements or information made or furnished by the Borrower, any other Loan Party or any other Subsidiary in connection with the Credit Agreement or otherwise, (iii) the validity, efficacy, sufficiency, or enforceability of the Credit Agreement, any Loan Document or any other document or instrument executed in connection therewith, or the collectibility of the Assigned Obligations, (iv) the perfection, priority or validity of any Lien with respect to any collateral at any time securing the Obligations or the Assigned Obligations under the Notes or the Credit Agreement and (v) the performance or failure to perform by the Borrower or any other Loan Party of any obligation under the Credit Agreement or any other Loan Document. Further, the Assignee acknowledges that it has, independently and without reliance upon the Administrative Agent, any other Lender or counsel to the Administrative Agent or any of their respective officers, directors, employees and agents and based on the financial statements supplied by the Borrower and such other documents and information as it has deemed appropriate, made its own credit analysis and decision to become a Lender under the Credit Agreement. The Assignee also acknowledges that it will, independently and without reliance upon the Administrative Agent or any other Lender and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit decisions in taking or not taking action under the Credit Agreement or any Note or pursuant to any other obligation. The Administrative Agent shall have no duty or responsibility whatsoever, either initially or on a continuing basis, to provide the Assignee with any credit or other information with respect to the Borrower, any other Loan Party or any other Subsidiary or to notify the undersigned of any Default or Event of Default except as expressly provided in the Credit Agreement. The Assignee has not relied on the Administrative Agent as to any legal or factual matter in connection therewith or in connection with the transactions contemplated thereunder.
Section 2.
Payment by Assignee
. In consideration of the assignment made pursuant to Section 1. of this Agreement, the Assignee agrees to pay to the Assignor on the Assignment Date
,
an amount equal to $_________ representing the aggregate principal amount outstanding of the
Revolving Loans owing to the Assignor under the Credit Agreement and the other Loan Documents being assigned hereby.
Section 3.
Payments by Assignor
. The Assignor agrees to pay to the Administrative Agent on the Assignment Date the administrative fee payable under Section 13.6.(b)(iv) of the Credit Agreement.
Section 4.
Representations and Warranties of Assignor
. The Assignor hereby represents and warrants to the Assignee that (a) as of the Assignment Date (i) the Assignor is a Lender under the Credit Agreement having a Revolving Commitment under the Credit Agreement immediately prior to the Assignment Date, equal to $____________ and that the Assignor is not in default of its obligations under the Credit Agreement; and (ii) the outstanding balance of Revolving Loans owing to the Assignor is $____________ and (b) it is the legal and beneficial owner of the Assigned Commitment which is free and clear of any adverse claim created by the Assignor.
Section 5.
Representations, Warranties and Agreements of Assignee
. The Assignee (a) represents and warrants that it is (i) legally authorized to enter into this Agreement; (ii) an “accredited investor” (as such term is used in Regulation D of the Securities Act) and (iii) an Eligible Assignee; (b) confirms that it has received a copy of the Credit Agreement, together with copies of the most recent financial statements delivered pursuant thereto and such other documents and information (including without limitation the Loan Documents) as it has deemed appropriate to make its own credit analysis and decision to enter into this Agreement; (c) appoints and authorizes the Administrative Agent to take such action as contractual representative on its behalf and to exercise such powers under the Loan Documents as are delegated to the Administrative Agent by the terms thereof together with such powers as are reasonably incidental thereto; (d) agrees that it will become a party to and shall be bound by the Credit Agreement and the other Loan Documents to which the other Lenders are a party on the Assignment Date and will perform in accordance therewith all of the obligations which are required to be performed by it as a Lender; and (e) is either (i) not organized under the laws of a jurisdiction outside the United States of America or (ii) has delivered to the Administrative Agent (with an additional copy for the Borrower) such items required under Section 3.10. of the Credit Agreement.
Section 6.
Recording and Acknowledgment by the Administrative Agent
. Following the execution of this Agreement, the Assignor will deliver to the Administrative Agent (a) a duly executed copy of this Agreement for acknowledgment and recording by the Administrative Agent and (b) the Assignor's Revolving Note. Upon such acknowledgment and recording, from and after the Assignment Date, the Administrative Agent shall make all payments in respect of the interest assigned hereby (including payments of principal, interest, fees and other amounts) to the Assignee. The Assignor and Assignee shall make all appropriate adjustments in payments under the Credit Agreement for periods prior to the Assignment Date directly between themselves.
Section 7.
Addresses
. The Assignee specifies as its address for notices and its Lending Office for all Loans, the offices set forth below:
_______________________
_______________________
Attention:_____________________
Telephone No.:_________________
Telecopy No.:__________________
Section 8.
Payment Instructions
. All payments to be made to the Assignee under this Agreement by the Assignor, and all payments to be made to the Assignee under the Credit Agreement, shall be made as provided in the Credit Agreement in accordance with the following instructions:
__________________________________
__________________________________
__________________________________
__________________________________
Section 9.
Effectiveness of Assignment
. This Agreement, and the assignment and assumption contemplated herein, shall not be effective until (a) this Agreement is executed and delivered by each of the Assignor, the Assignee, the Administrative Agent, the Swingline Lender, the Issuing Bank and if required, the Borrower, and (b) the payment to the Assignor of the amounts owing by the Assignee pursuant to Section 2. hereof and (c) the payment to the Administrative Agent of the amounts owing by the Assignor pursuant to Section 3. hereof. Upon recording and acknowledgment of this Agreement by the Administrative Agent, from and after the Assignment Date, (i) the Assignee shall be a party to the Credit Agreement and, to the extent provided in this Agreement, have the rights and obligations of a Lender thereunder and (ii) the Assignor shall, to the extent provided in this Agreement, relinquish its rights (except as otherwise provided in Section 13.11 of the Credit Agreement) and be released from its obligations under the Credit Agreement;
provided
,
however
, that if the Assignor does not assign its entire interest under the Loan Documents, it shall remain a Lender entitled to all of the benefits and subject to all of the obligations thereunder with respect to its Commitment.
Section 10.
Governing Law
. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO CONTRACTS EXECUTED, AND TO BE FULLY PERFORMED, IN SUCH STATE.
Section 11.
Counterparts
. This Agreement may be executed in any number of counterparts each of which, when taken together, shall constitute one and the same agreement.
Section 12.
Headings
. Section headings have been inserted herein for convenience only and shall not be construed to be a part hereof.
Section 13.
Amendments; Waivers
. This Agreement may not be amended, changed, waived or modified except by a writing executed by the Assignee and the Assignor.
Section 14.
Entire Agreement
. This Agreement embodies the entire agreement between the Assignor and the Assignee with respect to the subject matter hereof and supersedes all other prior arrangements and understandings relating to the subject matter hereof.
Section 15.
Binding Effect
. This Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and permitted assigns.
Section 16.
Definitions
. Terms not otherwise defined herein are used herein with the respective meanings given them in the Credit Agreement.
[Include this Section only if the Borrower's consent is required under Section 13.6.(b) of the Credit Agreement]
Section 17.
Agreements of the Borrower
. The Borrower hereby agrees that the Assignee shall be a Lender under the Credit Agreement having a Revolving Commitment equal to the Assigned Commitment. The Borrower agrees that the Assignee shall have all of the rights and remedies of a Lender under the Credit Agreement and the other Loan Documents as if the Assignee were an original Lender under and signatory to the Credit Agreement, including, but not limited to, the right of a Lender to receive payments of principal and interest with respect to the Assigned Obligations, if any, and to the Revolving Loans made by the Lenders after the date hereof and to receive the Fees payable to the Lenders as provided in the Credit Agreement. Further, the Assignee shall be entitled to the benefit of the indemnification provisions from the Borrower in favor of the Lenders as provided in the Credit Agreement and the other Loan Documents. The Borrower further agrees, upon the execution and delivery of this Agreement, to execute in favor of the Assignee a Revolving Note in an initial amount equal to the Assigned Commitment. Further, the Borrower agrees that, upon the execution and delivery of this Agreement, the Borrower shall owe the Assigned Obligations to the Assignee as if the Assignee were the Lender originally making such Loans and entering into such other obligations.
[Signatures on Following Page]
IN WITNESS WHEREOF, the parties hereto have duly executed this Assignment and Assumption Agreement as of the date and year first written above.
ASSIGNOR:
[NAME OF ASSIGNOR]
By:_________________________________
Name:____________________________
Title:_____________________________
Payment Instructions
[Bank]
[Address]
ABA No. :
Account No.:
Account Name:
Reference:
ASSIGNEE:
[NAME OF ASSIGNEE]
By:________________________________
Name:___________________________
Title:____________________________
Payment Instructions
[Bank]
[Address]
ABA No. :
Account No.:
Account Name:
Reference:
[Signatures continued on Following Page]
6
Agreed and Consented to as of the date first written above.
[Include signature of the Borrower only if required under Section 13.6.(b) of the Credit Agreement]
BORROWER:
[NAME OF BORROWER]
By:_________________________
Name:____________________
Title:_____________________
Accepted as of the date first written above.
ADMINISTRATIVE AGENT:
WELLS FARGO BANK, NATIONAL ASSOCIATION, as Administrative Agent
By:__________________________
Name:_____________________
Title:______________________
Accepted as of the date first written above.
SWINGLINE LENDER:
WELLS FARGO BANK, NATIONAL ASSOCIATION, as Swingline Lender
By:__________________________
Name:_____________________
Title:______________________
Accepted as of the date first written above.
ISSUING BANK:
WELLS FARGO BANK, NATIONAL ASSOCIATION, as Issuing Bank
By:__________________________
Name:_____________________
Title:______________________
EXHIBIT B
FORM OF SECOND AMENDED AND RESTATED GUARANTY
THIS SECOND AMENDED AND RESTATED GUARANTY (as the same may be amended, restated, supplemented or otherwise modified from time to time, this “Guaranty”) is made as of ____________ __, _____ by and among each of the Subsidiaries of CBL & Associates Limited Partnership (the “Borrower”) listed on the signature pages hereto (collectively, the “Initial Guarantors” and each an “Initial Guarantor”) and those additional Subsidiaries of the Borrower which become parties to this Guaranty by executing a supplement hereto (a “Guaranty Supplement”) in the form attached hereto as Annex I (such additional Subsidiaries, together with the Initial Guarantors, the “Guarantors”), in favor of Wells Fargo Bank, National Association, as Administrative Agent (the “Administrative Agent”), for its benefit and for the benefit of the Lenders and the Issuing Bank under the Credit Agreement described below (the Administrative Agent, the Lenders and the Issuing Bank, each individually a “Guaranteed Party” and collectively, the “Guaranteed Parties”). Unless otherwise defined herein, capitalized terms used herein and not defined herein shall have the meanings ascribed to such terms in the Credit Agreement.
W
I
T
N
E
S
S
E
T
H
:
WHEREAS, the Borrower, CBL & Associates Properties, Inc. (the “Parent”), the financial institutions party thereto from time to time (the “Existing Lenders”), and Wells Fargo Bank, National Association, as Administrative Agent (the “Existing Administrative Agent”) are party to that certain Seventh Amended and Restated Credit Agreement dated as of September 28, 2009 (as amended and in effect immediately prior to the date hereof, the “Existing Credit Agreement”);
WHEREAS, pursuant to the Existing Credit Agreement, certain entities entered into Amended and Restated Guaranties in favor of the Existing Administrative Agent for the benefit of the Existing Lenders under the Existing Credit Agreement (collectively, as amended and in effect immediately prior to the date hereof, the “Existing Guaranty”);
WHEREAS, the Borrower, the Parent, each of the financial institutions initially a signatory thereto together with their successors and assignees (the “Lenders”) and the Administrative Agent have entered into that certain Eighth Amended and Restated Credit Agreement of even date herewith (as the same may be amended, restated, supplemented or otherwise modified from time to time, the “Credit Agreement”), which Credit Agreement provides, subject to the terms and conditions thereof, for extensions of credit and other financial accommodations to be made by the Lenders to or for the benefit of the Borrower;
WHEREAS, it is a condition precedent to the extensions of credit by the Lenders under the Credit Agreement that each of the Guarantors (constituting all of the Subsidiaries of the Borrower required to execute this Guaranty pursuant to Section 8.14. of the Credit Agreement) agree to amend and restate the Existing Guaranty in the form of this Guaranty, whereby each of the Guarantors, without limitation and with full recourse, shall guarantee the payment when due of all Obligations, including, without limitation, all principal, interest, letter of credit reimbursement obligations and other amounts that shall be at any time payable by the Borrower under the Credit Agreement or the other Loan Documents; and
WHEREAS, in consideration of the direct and indirect financial and other support and benefits that the Borrower has provided, and such direct and indirect financial and other support and benefits as the Borrower may in the future provide, to the Guarantors, and in consideration of the increased ability of each Guarantor to receive funds through contributions to capital, and for each Guarantor to receive funds
through intercompany advances or otherwise, from funds provided to the Borrower pursuant to the Credit Agreement and the flexibility provided by the Credit Agreement for each Guarantor to do so which significantly facilitates the business operations of the Borrower and each Guarantor and in order to induce the Lenders and the Administrative Agent to enter into the Credit Agreement, and to make the Loans and the other financial accommodations to the Borrower and to issue the Letters of Credit described in the Credit Agreement, each of the Guarantors is willing to guarantee the Obligations under the Credit Agreement and the other Loan Documents;
NOW, THEREFORE, in consideration of the foregoing premises and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:
SECTION 1.
Representations, Warranties and Covenants
. Each of the Guarantors represents and warrants to each Guaranteed Party and the Administrative Agent as of the date of this Guaranty, giving effect to the consummation of the transactions contemplated by the Loan Documents on the Effective Date, and thereafter on each date as required by Section 6.2. of the Credit Agreement that:
(a)
It is a corporation, partnership or other legal entity, duly organized or formed, validly existing and in good standing under the jurisdiction of its incorporation or formation, has the power and authority to own or lease its respective properties and to carry on its respective business as now being and hereafter proposed to be conducted and is duly qualified and is in good standing as a domestic or foreign corporation, partnership or other legal entity, and authorized to do business, in each jurisdiction in which the character of its properties or the nature of its business requires such qualification or authorization and where the failure to be so qualified or authorized could reasonably be expected to have, in each instance, a Material Adverse Effect.
(b)
It has the right and power, and has taken all necessary action to authorize it, to execute, deliver and perform this Guaranty in accordance with its terms and to perform its obligations hereunder. This Guaranty has been duly executed and delivered by the duly authorized officers of such Guarantor and is a legal, valid and binding obligation of such Guarantor enforceable against such Guarantor in accordance with its terms, except as the same may be limited by bankruptcy, insolvency, and other similar laws affecting the rights of creditors generally and the availability of equitable remedies for the enforcement of certain obligations contained herein and as may be limited by equitable principles generally.
(c)
The execution, delivery and performance of this Guaranty in accordance with its terms and the obligations hereunder do not and will not, by the passage of time, the giving of notice, or both: (i) require any Governmental Approval or violate any Applicable Law (including all Environmental Laws) relating to such Guarantor; (ii) conflict with, result in a breach of or constitute a default under the organizational documents of such Guarantor, or any indenture, agreement or other instrument to which such Guarantor is a party or by which it or any of its respective properties may be bound; or (iii) result in or require the creation or imposition of any Lien upon or with respect to any Property now owned or hereafter acquired by such Guarantor other than in favor of the Administrative Agent for its benefit and the benefit of the Guaranteed Parties and the Issuing Bank. It is in compliance with each Governmental Approval and all other Applicable Laws relating to it except for non-compliances which, and Governmental Approvals the failure to possess which, could not, individually or in the aggregate, reasonably be expected to cause a Default or Event of Default or have a Material Adverse Effect.
(d)
It has no Indebtedness other than Indebtedness permitted under the Credit Agreement.
In addition to the foregoing, each of the Guarantors covenants that, so long as any Guaranteed Party has any Revolving Commitment, Swingline Commitment or Letter of Credit outstanding under the Credit Agreement or any amount payable under the Credit Agreement or any other Obligations shall remain unpaid, it will, and, if necessary, will cause the Borrower to, fully comply with those covenants and agreements of the Borrower applicable to such Guarantor set forth in the Credit Agreement.
SECTION 2.
The Guaranty
. Each of the Guarantors hereby irrevocably and unconditionally guarantees, jointly and severally with the other Guarantors, the full and punctual payment and performance when due (whether at stated maturity, upon acceleration or otherwise) of the Obligations, including, without limitation, (i) the principal of and interest on each Loan made to the Borrower pursuant to the Credit Agreement, (ii) obligations owing under or in connection with Letters of Credit, (iii) all other amounts payable by the Borrower under the Credit Agreement and the other Loan Documents, and (iv) the punctual and faithful performance, keeping, observance, and fulfillment by the Borrower of all of the agreements, conditions, covenants, and obligations of the Borrower contained in the Loan Documents (all of the foregoing being referred to collectively as the “Guaranteed Obligations”). Upon the failure by the Borrower, or any of its Affiliates, as applicable, to pay punctually any such amount or perform such obligation, subject to any applicable grace or notice and cure period, each of the Guarantors agrees that it shall forthwith on demand pay such amount or perform such obligation at the place and in the manner specified in the Credit Agreement or the relevant other Loan Document, as the case may be. Each of the Guarantors hereby agrees that this Guaranty is an absolute, irrevocable and unconditional guaranty of payment and is not a guaranty of collection.
SECTION 3.
Guaranty Unconditional
. The obligations of each of the Guarantors hereunder shall be unconditional and absolute and, without limiting the generality of the foregoing, shall not be released, discharged or otherwise affected by:
(i)
any extension, renewal, settlement, indulgence, compromise, waiver or release of or with respect to the Guaranteed Obligations or any part thereof or any agreement relating thereto, or with respect to any obligation of any other guarantor of any of the Guaranteed Obligations, whether (in any such case) by operation of law or otherwise, or any failure or omission to enforce any right, power or remedy with respect to the Guaranteed Obligations or any part thereof or any agreement relating thereto, or with respect to any obligation of any other guarantor of any of the Guaranteed Obligations;
(ii)
any modification or amendment of or supplement to the Credit Agreement or any other Loan Document, including, without limitation, any such amendment which may increase the amount of, or the interest rates applicable to, any of the Guaranteed Obligations guaranteed hereby;
(iii)
any release, surrender, compromise, settlement, waiver, subordination or modification, with or without consideration, of any other guaranties with respect to the Guaranteed Obligations or any part thereof, or any other obligation of any person or entity with respect to the Guaranteed Obligations or any part thereof;
(iv)
any change in the corporate, partnership, limited liability company or other existence, structure or ownership of the Borrower or any other guarantor of any of the Guaranteed Obligations, or any insolvency, bankruptcy, reorganization or other similar proceeding affecting the Borrower or any other guarantor of the Guaranteed Obligations, or any of their respective assets or any resulting release or discharge of any obligation of the Borrower or any other guarantor of any of the Guaranteed Obligations;
(v)
the existence of any claim, setoff or other rights which the Guarantors may have at any time against the Borrower, any other guarantor of any of the Guaranteed Obligations, the Administrative Agent, any Guaranteed Party or any other Person, whether in connection herewith or in connection with any unrelated transactions,
provided
that nothing herein shall prevent the assertion of any such claim by separate suit or compulsory counterclaim;
(vi)
the enforceability or validity of the Guaranteed Obligations or any part thereof or the genuineness, enforceability or validity of any agreement relating thereto, or any other invalidity or unenforceability relating to or against the Borrower or any other guarantor of any of the Guaranteed Obligations, for any reason related to the Credit Agreement or any other Loan Document, or any provision of applicable law, decree, order or regulation purporting to prohibit the payment by the Borrower or any other guarantor of the Guaranteed Obligations, of any of the Guaranteed Obligations or otherwise affecting any term of any of the Guaranteed Obligations;
(vii)
the election by, or on behalf of, any one or more of the Guaranteed Parties, in any proceeding instituted under Chapter 11 of Title 11 of the United States Code (11 U.S.C. 101 et seq.) (or any successor statute, the “
Bankruptcy Code
”), of the application of Section 1111(b)(2) of the Bankruptcy Code;
(viii)
any borrowing or grant of a security interest by the Borrower, as debtor-in-possession, under Section 364 of the Bankruptcy Code;
(ix)
the disallowance, under Section 502 of the Bankruptcy Code, of all or any portion of the claims of the Guaranteed Parties or the Administrative Agent for repayment of all or any part of the Guaranteed Obligations;
(x)
the failure of any other guarantor to sign or become party to this Guaranty or any amendment, change, or reaffirmation hereof; or
(xi)
any other act or omission to act or delay of any kind by the Borrower, any other guarantor of the Guaranteed Obligations, the Administrative Agent, any Guaranteed Party or any other Person or any other circumstance whatsoever which might, but for the provisions of this Section 3, constitute a legal or equitable discharge of any Guarantor's obligations hereunder or otherwise reduce, release, prejudice or extinguish its liability under this Guaranty.
SECTION 4.
Discharge Only Upon Payment In Full; Reinstatement In Certain Circumstances
. Each of the Guarantors' obligations hereunder shall remain in full force and effect until all Guaranteed Obligations shall have been paid in full in cash (other than Unliquidated Obligations that have not yet arisen) and the Revolving Commitments and Swingline Commitments and all Letters of Credit issued under the Credit Agreement shall have terminated or expired or, in the case of all Letters of Credit, are fully collateralized on terms reasonably acceptable to the Administrative Agent, at which time, subject to all the foregoing conditions, the guarantees made hereunder shall automatically terminate. If at any time any payment of the principal of or interest on any Loan, Obligation or any other amount payable by the Borrower or any other party under the Credit Agreement or any other Loan Document (including a payment effected through exercise of a right of setoff) is rescinded, or is or must be otherwise restored or returned upon the insolvency, bankruptcy or reorganization of the Borrower or otherwise (including pursuant to any settlement entered into by a Guaranteed Party in its discretion), each of the Guarantors' obligations hereunder with respect to such payment shall be reinstated as though such payment had been due but not made at such time. “Unliquidated Obligations” means at any time, any Obligations (or portion thereof) that are contingent in nature or unliquidated at such time, including any Obligation that is: (i) an obligation under the Credit Agreement to reimburse the Issuing Bank for drawings not yet made
under a Letter of Credit issued by it; (ii) any other obligation (including any guarantee) under the Credit Agreement that is contingent in nature at such time; or (iii) an obligation under the Credit Agreement to provide collateral to secure any of the foregoing types of obligations.
SECTION 5.
General Waivers; Additional Waivers
.
(a)
General Waivers
. Each of the Guarantors irrevocably waives acceptance hereof, presentment, demand or action on delinquency, protest, the benefit of any statutes of limitations and, to the fullest extent permitted by law, any notice not provided for herein or under the other Loan Documents, as well as any requirement that at any time any action be taken by any Person against the Borrower, any other guarantor of the Guaranteed Obligations, or any other Person.
(b)
Additional Waivers
. Notwithstanding anything herein to the contrary, each of the Guarantors hereby absolutely, unconditionally, knowingly, and expressly waives, to the fullest extent permitted by law:
(i) any right it may have to revoke this Guaranty as to future indebtedness or notice of acceptance hereof;
(ii) (1) notice of acceptance hereof; (2) notice of any Loans, Letters of Credit or other financial accommodations made or extended under the Loan Documents or the creation or existence of any Guaranteed Obligations; (3) notice of the amount of the Guaranteed Obligations, subject, however, to each Guarantor's right to make inquiry of the Administrative Agent and the Guaranteed Parties to ascertain the amount of the Guaranteed Obligations at any reasonable time; (4) notice of any adverse change in the financial condition of the Borrower or of any other fact that might increase such Guarantor's risk hereunder; (5) notice of presentment for payment, demand, protest, and notice thereof as to any instruments among the Loan Documents; (6) notice of any Default or Event of Default; and (7) all other notices (except if such notice is specifically required to be given to such Guarantor hereunder or under the Loan Documents) and demands to which each Guarantor might otherwise be entitled;
(iii) its right, if any, to require the Administrative Agent and the other Guaranteed Parties to institute suit against, or to exhaust any rights and remedies which the Administrative Agent and the other Guaranteed Parties has or may have against, the other Guarantors or any third party; and each Guarantor further waives any defense arising by reason of any disability or other defense (other than the defense that the Guaranteed Obligations shall have been fully and finally performed and indefeasibly paid in full in cash) of the other Guarantors or by reason of the cessation from any cause whatsoever of the liability of the other Guarantors in respect thereof;
(iv) (a) any rights to assert against the Administrative Agent and the other Guaranteed Parties any defense (legal or equitable), set-off, counterclaim, or claim which such Guarantor may now or at any time hereafter have against the other Guarantors or any other party liable to the Administrative Agent and the other Guaranteed Parties unless due to the
gross negligence or willful misconduct of the Administrative Agent or such Guaranteed Party as determined by a court of competent jurisdiction in a final non-appealable judgment
; (b) any defense, set-off, counterclaim, or claim, of any kind or nature, arising directly or indirectly from the present or future lack of sufficiency, validity, or enforceability of the Guaranteed Obligations; (c) any defense such Guarantor has to performance hereunder, and any right such Guarantor has to be exonerated, arising by reason of: (1) the impairment or suspension of the Administrative Agent's and the other Guaranteed Parties' rights or remedies against the other guarantor of the Guaranteed Obligations; (2) the alteration by the Administrative Agent and the other Guaranteed Parties of
the Guaranteed Obligations; (3) any discharge of the other Guarantors' obligations to the Administrative Agent and the other Guaranteed Parties by operation of law as a result of the Administrative Agent's and the other Guaranteed Parties' intervention or omission; or (4) the acceptance by the Administrative Agent and the other Guaranteed Parties of anything in partial satisfaction of the Guaranteed Obligations; and (d) the benefit of any statute of limitations affecting such Guarantor's liability hereunder or the enforcement thereof, and any act which shall defer or delay the operation of any statute of limitations applicable to the Guaranteed Obligations shall similarly operate to defer or delay the operation of such statute of limitations applicable to such Guarantor's liability hereunder; and
(v) any defense arising by reason of or deriving from (a) any claim or defense based upon an election of remedies by the Administrative Agent and the Guaranteed Parties; or (b) any election by the Administrative Agent and the other Guaranteed Parties under the Bankruptcy Code, to limit the amount of its claim against the Guarantors.
SECTION 6.
Subordination of Subrogation; Subordination of Intercompany Indebtedness
.
(a)
Subordination of Subrogation
. Until the Guaranteed Obligations have been fully and finally performed and indefeasibly paid in full in cash (other than Unliquidated Obligations), the Guarantors (i) shall have no right of subrogation with respect to such Guaranteed Obligations and (ii) waive any right to enforce any remedy which the Issuing Bank, any of the Guaranteed Parties or the Administrative Agent now have or may hereafter have against the Borrower, any endorser or any guarantor of all or any part of the Guaranteed Obligations or any other Person. Should any Guarantor have the right, notwithstanding the foregoing, to exercise its subrogation rights, each Guarantor hereby expressly and irrevocably (A) subordinates any and all rights at law or in equity to subrogation, reimbursement, exoneration, contribution, indemnification or set off that such Guarantor may have to the payment in full in cash of the Guaranteed Obligations until the Guaranteed Obligations are indefeasibly paid in full in cash (other than Unliquidated Obligations) and (B) waives any and all defenses available to a surety, guarantor or accommodation co-obligor until the Guaranteed Obligations are indefeasibly paid in full in cash (other than Unliquidated Obligations that have not yet arisen). Each Guarantor acknowledges and agrees that this subordination is intended to benefit the Administrative Agent and the Guaranteed Parties and shall not limit or otherwise affect such Guarantor's liability hereunder or the enforceability of this Guaranty, and that the Administrative Agent, the Guaranteed Parties and their respective successors and assigns are intended third party beneficiaries of the waivers and agreements set forth in this Section 6(a).
(b)
Subordination of Intercompany Indebtedness
. Each Guarantor agrees that any and all claims of such Guarantor against the Borrower or any other Guarantor hereunder (each an “Obligor”) with respect to any “Intercompany Indebtedness” (as hereinafter defined), any endorser, obligor or any other guarantor of all or any part of the Guaranteed Obligations, or against any of its properties shall be subordinate and subject in right of payment to the prior payment, in full and in cash, of all Guaranteed Obligations; provided that, as long as no Event of Default has occurred and is continuing, such Guarantor may receive payments of principal and interest from any Obligor with respect to Intercompany Indebtedness. Notwithstanding any right of any Guarantor to ask, demand, sue for, take or receive any payment from any Obligor, all rights, liens and security interests of such Guarantor, whether now or hereafter arising and howsoever existing, in any assets of any other Obligor shall be and are subordinated to the rights of the Guaranteed Parties and the Administrative Agent in those assets. No Guarantor shall have any right to possession of any such asset or to foreclose upon any such asset, whether by judicial action or otherwise, unless and until all of the Guaranteed Obligations shall have been fully paid and satisfied (in cash) and all financing arrangements pursuant to any Loan Document have been terminated. If all or any part of the assets of any Obligor, or the proceeds thereof, are subject to any distribution,
division or application to the creditors of such Obligor, whether partial or complete, voluntary or involuntary, and whether by reason of liquidation, bankruptcy, arrangement, receivership, assignment for the benefit of creditors or any other action or proceeding, or if the business of any such Obligor is dissolved or if substantially all of the assets of any such Obligor are sold, then, and in any such event (such events being herein referred to as an “
Insolvency Event
”), any payment or distribution of any kind or character, either in cash, securities or other property, which shall be payable or deliverable upon or with respect to any indebtedness of any Obligor to any Guarantor (“
Intercompany Indebtedness
”) shall be paid or delivered directly to the Administrative Agent for application on any of the Guaranteed Obligations, due or to become due, until such Guaranteed Obligations shall have first been fully paid and satisfied (in cash). Should any payment, distribution, security or instrument or proceeds thereof be received by the applicable Guarantor upon or with respect to the Intercompany Indebtedness after any Insolvency Event and prior to the satisfaction of all of the Guaranteed Obligations and the termination of all financing arrangements pursuant to any Loan Document among the Borrower and the Guaranteed Parties, such Guarantor shall receive and hold the same in trust, as trustee, for the benefit of the Guaranteed Parties and shall forthwith deliver the same to the Administrative Agent, for the benefit of the Guaranteed Parties, in precisely the form received (except for the endorsement or assignment of such Guarantor where necessary), for application to any of the Guaranteed Obligations, due or not due, and, until so delivered, the same shall be held in trust by the Guarantor as the property of the Guaranteed Parties. If any such Guarantor fails to make any such endorsement or assignment to the Administrative Agent, the Administrative Agent or any of its officers or employees is irrevocably authorized to make the same. Each Guarantor agrees that until the Guaranteed Obligations (other than the Unliquidated Obligations) have been paid in full (in cash) and satisfied and all financing arrangements pursuant to any Loan Document among the Borrower and the Guaranteed Parties have been terminated, no Guarantor will assign or transfer to any Person (other than the Administrative Agent) any claim any such Guarantor has or may have against any Obligor.
SECTION 7.
Contribution with Respect to Guaranteed Obligations
.
(a) To the extent that any Guarantor shall make a payment under this Guaranty (a “
Guarantor Payment
”) which, taking into account all other Guarantor Payments then previously or concurrently made by any other Guarantor, exceeds the amount which otherwise would have been paid by or attributable to such Guarantor if each Guarantor had paid the aggregate Guaranteed Obligations satisfied by such Guarantor Payment in the same proportion as such Guarantor's “Allocable Amount” (as defined below) (as determined immediately prior to such Guarantor Payment) bore to the aggregate Allocable Amounts of each of the Guarantors as determined immediately prior to the making of such Guarantor Payment,
then
, following indefeasible payment in full in cash of the Guarantor Payment and the Guaranteed Obligations (other than Unliquidated Obligations that have not yet arisen), and all Revolving Commitments, Swingline Commitments and Letters of Credit have terminated or expired or, in the case of all Letters of Credit, are fully collateralized on terms reasonably acceptable to the Administrative Agent, and the Credit Agreement has terminated, such Guarantor shall be entitled to receive contribution and indemnification payments from, and be reimbursed by, each other Guarantor for the amount of such excess,
pro
rata
based upon their respective Allocable Amounts in effect immediately prior to such Guarantor Payment.
(b) As of any date of determination, the “Allocable Amount” of any Guarantor shall be equal to the excess of the fair saleable value of the property of such Guarantor over the total liabilities of such Guarantor (including the maximum amount reasonably expected to become due in respect of contingent liabilities, calculated, without duplication, assuming each other Guarantor that is also liable for such contingent liability pays its ratable share thereof), giving effect to all payments made by other Guarantors as of such date in a manner to maximize the amount of such contributions.
(c) This Section 7 is intended only to define the relative rights of the Guarantors, and nothing set forth in this Section 7 is intended to or shall impair the obligations of the Guarantors, jointly and severally, to pay any amounts as and when the same shall become due and payable in accordance with the terms of this Guaranty.
(d) The parties hereto acknowledge that the rights of contribution and indemnification hereunder shall constitute assets of the Guarantor or Guarantors to which such contribution and indemnification is owing.
(e) The rights of the indemnifying Guarantors against other Guarantors under this Section 7 shall be exercisable upon the full and indefeasible payment of the Guaranteed Obligations in cash (other than Unliquidated Obligations that have not yet arisen) and the termination or expiry (or in the case of all Letters of Credit full collateralization), on terms reasonably acceptable to the Administrative Agent, of the Revolving Commitments, Swingline Commitments and all Letters of Credit issued under the Credit Agreement and the termination of the Credit Agreement.
SECTION 8.
Limitation of Guaranty
. Notwithstanding any other provision of this Guaranty, the amount guaranteed by each Guarantor hereunder shall be limited to the extent, if any, required so that its obligations hereunder shall not be subject to avoidance under Section 548 of the Bankruptcy Code or under any applicable state Uniform Fraudulent Transfer Act, Uniform Fraudulent Conveyance Act or similar statute or common law. In determining the limitations, if any, on the amount of any Guarantor's obligations hereunder pursuant to the preceding sentence, it is the intention of the parties hereto that any rights of subrogation, indemnification or contribution which such Guarantor may have under this Guaranty, any other agreement or applicable law shall be taken into account.
SECTION 9.
Stay of Acceleration
. If acceleration of the time for payment of any amount payable by the Borrower under the Credit Agreement or any other Loan Document is stayed upon the insolvency, bankruptcy or reorganization of the Borrower or any of its Affiliates, all such amounts otherwise subject to acceleration under the terms of the Credit Agreement or any other Loan Document shall nonetheless be payable by each of the Guarantors hereunder forthwith on demand by the Administrative Agent.
SECTION 10.
Notices
. All notices, requests and other communications to any party hereunder shall be given in the manner prescribed in Section 13.1. of the Credit Agreement with respect to the Administrative Agent at its notice address therein and, with respect to any Guarantor, in the care of the Borrower at the address of the Borrower set forth in the Credit Agreement, or such other address or telecopy number as such party may hereafter specify for such purpose in accordance with the provisions of Section 13.1. of the Credit Agreement.
SECTION 11.
No Waivers
. No failure or delay by the Administrative Agent or any Guaranteed Party in exercising any right, power or privilege hereunder shall operate as a waiver thereof nor shall any single or partial exercise thereof preclude any other or further exercise thereof or the exercise of any other right, power or privilege. The rights and remedies provided in this Guaranty, the Credit Agreement and the other Loan Documents shall be cumulative and not exclusive of any rights or remedies provided by law.
SECTION 12.
Successors and Assigns
. This Guaranty is for the benefit of the Administrative Agent and the Guaranteed Parties and their respective successors and permitted assigns,
provided
, that no Guarantor shall have any right to assign its rights or obligations hereunder without the consent of the Administrative Agent, and any such assignment in violation of this Section 12 shall be null and void; and in the event of an assignment of any amounts payable under the Credit Agreement or the other Loan
Documents in accordance with the respective terms thereof, the rights hereunder, to the extent applicable to the indebtedness so assigned, may be transferred with such indebtedness. This Guaranty shall be binding upon each of the Guarantors and their respective successors and assigns.
SECTION 13.
Changes in Writing
. Other than in connection with the addition of additional Subsidiaries, which become parties hereto by executing a Guaranty Supplement hereto in the form attached as
Annex I
, neither this Guaranty nor any provision hereof may be changed, waived, discharged or terminated orally, but only in writing signed by each of the Guarantors and the Administrative Agent.
SECTION 14.
Governing Law; Jurisdiction
.
(a) THIS GUARANTY
SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO CONTRACTS EXECUTED, AND TO BE FULLY PERFORMED, IN SUCH STATE
.
(b) EACH PARTY HERETO ACKNOWLEDGES THAT ANY DISPUTE OR CONTROVERSY BETWEEN OR AMONG THE GUARANTORS OR THE ADMINISTRATIVE AGENT WOULD BE BASED ON DIFFICULT AND COMPLEX ISSUES OF LAW AND FACT AND WOULD RESULT IN DELAY AND EXPENSE TO THE PARTIES. ACCORDINGLY, TO THE EXTENT PERMITTED BY APPLICABLE LAW, THE ADMINISTRATIVE AGENT AND EACH OF THE GUARANTORS HEREBY WAIVES ITS RIGHT TO A TRIAL BY JURY IN ANY ACTION OR PROCEEDING OF ANY KIND OR NATURE IN ANY COURT OR TRIBUNAL IN WHICH AN ACTION MAY BE COMMENCED BY OR AGAINST ANY PARTY HERETO ARISING OUT OF THIS GUARANTY, THE CREDIT AGREEMENT, THE NOTES, OR ANY OTHER LOAN DOCUMENT OR THE FEE LETTER OR BY REASON OF ANY OTHER SUIT, CAUSE OF ACTION OR DISPUTE WHATSOEVER BETWEEN OR AMONG THE BORROWER, THE GUARANTORS, THE PARENT, THE ADMINISTRATIVE AGENT, THE ISSUING BANK OR ANY OF THE LENDERS OF ANY KIND OR NATURE.
(c) EACH GUARANTOR IRREVOCABLY AND UNCONDITIONALLY AGREES THAT IT WILL NOT COMMENCE ANY ACTION, LITIGATION OR PROCEEDING OF ANY KIND OR DESCRIPTION, WHETHER IN LAW OR EQUITY, WHETHER IN CONTRACT OR IN TORT OR OTHERWISE, AGAINST THE ADMINISTRATIVE AGENT, ANY LENDER, THE ISSUING BANK, OR ANY RELATED PARTY OF THE FOREGOING IN ANY WAY RELATING TO THIS GUARANTY OR ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS RELATING HERETO OR THERETO, IN ANY FORUM OTHER THAN THE COURTS OF THE STATE OF NEW YORK 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, AND EACH OF THE PARTIES HERETO IRREVOCABLY AND UNCONDITIONALLY SUBMITS TO THE JURISDICTION OF SUCH COURTS AND AGREES THAT ALL CLAIMS IN RESPECT OF ANY SUCH ACTION, LITIGATION OR PROCEEDING MAY BE HEARD AND DETERMINED IN SUCH NEW YORK STATE COURT OR, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, IN SUCH FEDERAL COURT. EACH OF THE PARTIES HERETO AGREES THAT A FINAL, NON-APPEALABLE JUDGMENT IN ANY SUCH ACTION, LITIGATION 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 OR IN ANY OTHER LOAN DOCUMENT SHALL AFFECT ANY RIGHT THAT THE ADMINISTRATIVE AGENT, ANY LENDER OR THE ISSUING BANK MAY OTHERWISE HAVE TO BRING ANY ACTION OR PROCEEDING RELATING TO THIS GUARANTY OR ANY OTHER LOAN DOCUMENT AGAINST ANY GUARANTOR OR ITS PROPERTIES IN THE COURTS OF ANY JURISDICTION. EACH PARTY FURTHER WAIVES ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH ACTION OR PROCEEDING IN ANY SUCH COURT OR THAT SUCH ACTION OR PROCEEDING WAS BROUGHT IN AN INCONVENIENT FORUM AND EACH AGREES NOT TO PLEAD OR CLAIM THE SAME. THE CHOICE OF FORUM SET FORTH IN THIS SECTION SHALL NOT BE DEEMED TO PRECLUDE THE BRINGING OF ANY ACTION BY THE ADMINISTRATIVE AGENT, THE ISSUING BANK OR ANY LENDER OR THE ENFORCEMENT BY THE ADMINISTRATIVE AGENT, THE ISSUING BANK OR ANY LENDER OF ANY JUDGMENT OBTAINED IN SUCH FORUM IN ANY OTHER APPROPRIATE JURISDICTION.
(d) EACH GUARANTOR HEREBY WAIVES PERSONAL SERVICE OF THE SUMMONS AND COMPLAINT, OR OTHER PROCESS OR PAPERS ISSUED THEREIN, AND AGREES THAT SERVICE OF SUCH SUMMONS AND COMPLAINT, OR OTHER PROCESS OR PAPERS MAY BE MADE BY REGISTERED OR CERTIFIED MAIL ADDRESSED TO THE BORROWER AT ITS ADDRESS FOR NOTICES PROVIDED FOR IN THE CREDIT AGREEMENT. SHOULD A GUARANTOR FAIL TO APPEAR OR ANSWER ANY SUMMONS, COMPLAINT, PROCESS OR PAPERS SO SERVED WITHIN THIRTY (30) DAYS AFTER THE MAILING THEREOF, SUCH GUARANTOR SHALL BE DEEMED IN DEFAULT AND AN ORDER AND/OR JUDGMENT MAY BE ENTERED AGAINST IT AS DEMANDED OR PRAYED FOR IN SUCH SUMMONS, COMPLAINT, PROCESS OR PAPERS.
(e) THE PROVISIONS OF THIS SECTION HAVE BEEN CONSIDERED BY EACH PARTY WITH THE ADVICE OF COUNSEL AND WITH A FULL UNDERSTANDING OF THE LEGAL CONSEQUENCES THEREOF, AND SHALL SURVIVE THE PAYMENT OF THE LOANS AND ALL OTHER GUARANTEED OBLIGATIONS, THE TERMINATION OR EXPIRATION OF ALL LETTERS OF CREDIT, THE TERMINATION OF THE CREDIT AGREEMENT AND THE TERMINATION OF THIS GUARANTY
.
SECTION 15.
No Strict Construction
. The parties hereto have participated jointly in the negotiation and drafting of this Guaranty. In the event an ambiguity or question of intent or interpretation arises, this Guaranty shall be construed as if drafted jointly by the parties hereto and no presumption or burden of proof shall arise favoring or disfavoring any party by virtue of the authorship of any provisions of this Guaranty.
SECTION 16.
Taxes; Expenses of Enforcement, Etc.
(a)
Taxes
. All payments by any Guarantor of principal of, and interest on, the Loans and all other Obligations shall be made free and clear of and without deduction for any Taxes. If any
withholding or deduction from any payment to be made by a Guarantor hereunder is required in respect of any Taxes pursuant to any Applicable Law, then such Guarantor will:
(i) pay directly to the relevant Governmental Authority the full amount required to be so withheld or deducted;
(ii) promptly forward to the Administrative Agent an official receipt or other documentation satisfactory to the Administrative Agent evidencing such payment to such Governmental Authority; and
(iii) pay to the Administrative Agent for its account or the account of the applicable Lender or the Issuing Bank, as the case may be, such additional amount or amounts as is necessary to ensure that the net amount actually received by the Administrative Agent, the Issuing Bank or such Lender will equal the full amount that the Administrative Agent, the Issuing Bank or such Lender would have received had no such withholding or deduction been required.
(iv) If any Guarantor fails to pay any Taxes when due to the appropriate Governmental Authority or fails to remit to the Administrative Agent, for its account or the account of the Issuing Bank or respective Lender, as the case may be, the required receipts or other required documentary evidence, the Guarantors shall indemnify the Administrative Agent, the Issuing Bank and the Lenders for any incremental Taxes, interest or penalties that may become payable by the Administrative Agent, the Issuing Bank or any Lender as a result of any such failure.
(v) By accepting the benefits hereof, each Lender agrees that it will comply with Section 3.10.(c) of the Credit Agreement.
(b) The Guarantors agree to reimburse the Guaranteed Parties for any reasonable costs and out-of-pocket expenses (including attorneys' fees) paid or incurred by any Guaranteed Party in connection with the collection and enforcement of amounts due under the Loan Documents, including without limitation this Guaranty.
SECTION 17.
[
Reserved
]
SECTION 18.
Financial Information
. Each Guarantor hereby assumes responsibility for keeping itself informed of the financial condition of the Borrower, the other Guarantors and any and all endorsers and/or other guarantors of all or any part of the Guaranteed Obligations, and of all other circumstances bearing upon the risk of nonpayment of the Guaranteed Obligations, or any part thereof, that diligent inquiry would reveal, and each Guarantor hereby agrees that none of the Guaranteed Parties or the Administrative Agent shall have any duty to advise such Guarantor of information known to any of them regarding such condition or any such circumstances. In the event any Guaranteed Party or the Administrative Agent, in its sole discretion, undertakes at any time or from time to time to provide any such information to a Guarantor, such Guaranteed Party or the Administrative Agent shall be under no obligation (i) to undertake any investigation not a part of its regular business routine, (ii) to disclose any information which such Guaranteed Party or the Administrative Agent, pursuant to accepted or reasonable commercial finance or banking practices, wishes to maintain confidential or (iii) to make any other or future disclosures of such information or any other information to such Guarantor.
SECTION 19.
Severability
. Wherever possible, each provision of this Guaranty shall be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Guaranty shall be prohibited by or invalid under such law, such provision shall be ineffective to the extent
of such prohibition or invalidity without invalidating the remainder of such provision or the remaining provisions of this Guaranty.
SECTION 20.
Merger
. This Guaranty represents the final agreement of each of the Guarantors with respect to the matters contained herein and may not be contradicted by evidence of prior or contemporaneous agreements, or subsequent oral agreements, between each such Guarantor and any Guaranteed Party or the Administrative Agent.
SECTION 21.
Headings
. Section headings in this Guaranty are for convenience of reference only and shall not govern the interpretation of any provision of this Guaranty.
SECTION 22.
Termination of Guarantors
. The obligations of any Guarantor under this Guaranty shall automatically terminate in accordance with Section 8.14.(b) of the Credit Agreement.
SECTION 23.
AMENDMENT, RESTATEMENT AND CONSOLIDATION; NO NOVATION
. THE EXISTING GUARANTY IS BEING AMENDED, RESTATED AND CONSOLIDATED IN ITS ENTIRETY BY THIS GUARANTY FOR THE CONVENIENCE OF THE PARTIES. THIS GUARANTY MERELY AMENDS, MODIFIES, RESTATES AND CONSOLIDATES THE OBLIGATIONS EVIDENCED BY THE EXISTING GUARANTY AND DOES NOT CONSTITUTE, AND IT IS THE EXPRESS INTENT OF THE PARTIES HERETO THAT THIS GUARANTY DOES NOT EFFECT, A NOVATION OF THE EXISTING OBLIGATIONS OF THE GUARANTORS PARTY TO THE EXISTING GUARANTY. ALL SUCH OBLIGATIONS CONTINUE TO REMAIN OUTSTANDING AND EVIDENCED BY THIS GUARANTY. THE AMENDMENT, RESTATEMENT AND CONSOLIDATION EFFECTED HEREBY SHALL BE DEEMED TO HAVE PROSPECTIVE APPLICATION ONLY FROM AND AFTER THE EFFECTIVE DATE, UNLESS OTHERWISE EXPRESSLY STATED HEREIN.
SECTION 24.
General Partners
.
(a) CBL Holdings I, Inc., the general partner of the Borrower, shall not be personally liable for the payment of the Guaranteed Obligations, except to the extent provided for in Section 13.21. of the Credit Agreement.
(b) Subject to the exceptions and qualifications described below, so long as any general partner of a Guarantor (specifically excluding, however, CBL & Associates Limited Partnership) (each a “General Partner”) owns no property or assets (including Equity Interests in any Person) other than its interest in Guarantor, said General Partner (specifically excluding, however, CBL & Associates Limited Partnership) shall not be personally liable for the payment of the Guaranteed Obligations. Notwithstanding the foregoing: (i) if an Event of Default occurs, nothing contained herein shall in any way prevent or hinder the Administrative Agent, the Issuing Bank or the Lenders in the enforcement or foreclosure of any Lien securing any of the Obligations, or in the pursuit or enforcement of any right, remedy or judgment against the Guarantor, the Borrower or any other Loan Party, or any of their respective assets; (ii) the General Partner shall be fully liable to the Administrative Agent and the Lenders to the same extent that the General Partner would be liable absent the foregoing provisions of this Section for fraud or willful misrepresentation by the General Partner, or its Affiliates, (to the full extent of losses suffered by the Administrative Agent or any Lender by reason of such fraud or willful misrepresentations); and (iii) CBL & Associates Limited Partnership shall in all events be fully and personally liable for payment of the Obligations as set forth in the Loan Documents.
[
SIGNATURE PAGES TO FOLLOW
]
IN WITNESS WHEREOF, each Initial Guarantor has caused this Guaranty to be duly executed by its authorized officer as of the day and year first above written.
|
|
|
|
[
GUARANTORS TO COME
]
By:______________________________
Name:
Title:
|
Signature Page to Guaranty
Acknowledged and Agreed to:
WELLS FARGO BANK, NATIONAL ASSOCIATION, as Administrative Agent
By:__________________________________
Name:
Title:
Signature Page to Guaranty
ANNEX I TO SECOND AMENDED AND RESTATED GUARANTY
Reference is hereby made to the Second Amended and Restated Guaranty (as the same may be amended, restated, supplemented or otherwise modified from time to time, the “Guaranty”), dated as of ____________ __, _____, made by each of the Subsidiaries of CBL & Associates Limited Partnership (the “Borrower”) listed on the signature pages thereto (each an “Initial Guarantor”, and together with any additional Subsidiaries which become parties to the Guaranty by executing Guaranty Supplements thereto substantially similar in form and substance hereto, the “Guarantors”), in favor of the Administrative Agent, for the ratable benefit of the Guaranteed Parties, under the Credit Agreement. Each capitalized term used herein and not defined herein shall have the meaning given to it in the Guaranty.
By its execution below, the undersigned,
[
NAME OF NEW GUARANTOR
]
, a
[
________________
] [
corporation
]
[
partnership
]
[
limited liability company
]
(the “New Guarantor”), agrees to become, and does hereby become, a Guarantor under the Guaranty and agrees to be bound by such Guaranty as if originally a party thereto. By its execution below, the undersigned represents and warrants as to itself that all of the representations and warranties contained in Section 1 of the Guaranty are true and correct in all respects as of the date hereof.
IN WITNESS WHEREOF, the New Guarantor has executed and delivered this
Annex I
counterpart to the Guaranty as of this __________ day of _________, 20___.
[
NAME OF NEW GUARANTOR
]
By:____________________________________
Name:
Title:
EXHIBIT C
NOTICE OF BORROWING
CBL & ASSOCIATES
LIMITED PARTNERSHIP
__________ __, 20__
Wells Fargo Bank, National Association
123 North Wacker Drive, Suite 1900
Chicago, Illinois 60606
ATTN: ____________________
Ladies and Gentlemen:
Reference is made to that certain Eighth Amended and Restated Credit Agreement dated as of November 13, 2012 (as it may be modified, amended and restated from time to time, the "Credit Agreement"), by and among CBL & Associates Limited Partnership (the "Borrower"), CBL & Associates Properties, Inc., Wells Fargo Bank, National Association and the other lenders from time to time party thereto (collectively, together with Assignees under
Section 13.6
thereof, the "Lenders") and Wells Fargo Bank, National Association, as administrative agent (in such capacity, "Administrative Agent"). Capitalized terms used herein, and not otherwise defined herein, have their respective meanings given them in the Credit Agreement.
|
|
1.
|
Pursuant to
Section 2.1(b)
of the Credit Agreement, the Borrower hereby requests that the Lenders make a Revolving Loan to the Borrower in an amount equal to ____________ Dollars ($________).
|
|
|
2.
|
The Borrower requests that the Revolving Loan be made available to the Borrower on _____________, 20__.
|
|
|
3.
|
The Borrower hereby requests that the requested Revolving Loan be of the following Type:
|
[Check one box only]
□
Base Rate Loan
□
LIBOR Loan, with an initial Interest Period for a duration of:
□
one month
□
three months
□
six months
Wells Fargo Bank, National Association
____________, ____
Page 2
The Borrower hereby certifies to the Administrative Agent and the Lenders that as of the date hereof, as of the proposed date of the requested Revolving Loan, and after giving effect to such Revolving Loan, (a) the proposed use of the proceeds of such Loan set forth above is consistent with the provisions of
Section 8.8
of the Credit Agreement; (b) there exists no Default or Event of Default, nor will a Default or Event of Default exist immediately after giving effect to the Revolving Loan requested hereunder; (c) none of the conditions described in Section 2.15. would exist after giving effect to the making of such Loan; and (d) all of the representations and warranties made by Borrower or any other Loan Party under the Credit Agreement or under any of the other Loan Documents are true and correct in all material respects (except in the case of a representation or warranty qualified by materiality, in which case such representation or warranty shall be true and correct in all respects) on and as of the date hereof with the same force and effect as if made on and as of such date, except to the extent such representations or warranties expressly relate solely to an earlier date (in which case such representations and warranties shall have been true and accurate in all material respects (except in the case of a representation or warranty qualified by materiality, in which case such representation or warranty shall be true and correct in all respects) on and as of such earlier date) and except for changes in factual circumstances specifically and expressly permitted under the Credit Agreement or the other Loan Documents. In addition, the Borrower certifies to the Administrative Agent and the Lenders that all conditions to the making of the requested Revolving Loans contained in Article VI. of the Credit Agreement will have been satisfied at the time such Revolving Loans are made.
|
|
|
|
CBL & ASSOCIATES LIMITED PARTNERSHIP
By: CBL Holdings I, Inc.,
as General Partner
By:______________________
Name:
Title:
|
|
|
EXHIBIT D
NOTICE OF CONTINUATION
CBL & ASSOCIATES
LIMITED PARTNERSHIP
__________ __, 20___
Wells Fargo Bank, National Association
123 North Wacker Drive, Suite 1900
Chicago, Illinois 60606
Attention: __________________
Ladies and Gentlemen:
Reference is made to that certain Eighth Amended and Restated Credit Agreement dated as of November 13, 2012 (as it may be amended from time to time, the "Credit Agreement"), by and among CBL & Associates Limited Partnership (the "Borrower"), CBL & Associates Properties, Inc., Wells Fargo Bank, National Association and the other lenders from time to time party thereto (collectively, together with Assignees under
Section 13.6
thereof, the "Lenders"), and Wells Fargo Bank, National Association, as administrative agent (in such capacity, the "Administrative Agent"). Capitalized terms used herein and not otherwise defined herein, have their respective meanings given them in this Credit Agreement.
Pursuant to
Section 2.9
of the Credit Agreement, the Borrower hereby elects to the maintain all, or the portion set forth below, of the LIBOR Loan in the amount of ________________ Dollars ($____________) and having an Interest Period expiring on __________________, as a LIBOR Loan, and in that connection sets forth below the information relating to such continuation as required by such
Section 2.9
of the Credit Agreement:
|
|
1.
|
The requested date of such continuation is _________, 20___.
|
|
|
2.
|
The amount of the existing LIBOR Loan to be continued as a LIBOR Loan is:
|
[Check one box only]
□
All of said LIBOR Loan (being $________)
□
$___________
|
|
3.
|
The current Interest Period of the Loans subject to such continuation ends on _________, 20___.
|
Wells Fargo Bank, National Association
_______________, _____
Page 2
|
|
4.
|
The amount of the LIBOR Loan being continued shall have an Interest Period of:
|
[Check one box only]
□
one month
□
three months
□
six months
The Borrower hereby certifies to the Administrative Agent and the Lenders that as of the date hereof, as of the proposed date of the requested continuation, and after giving effect to such continuation, (a) there exists no Default or Event of Default, nor will a Default or Event of Default exist immediately after giving effect to the continuation requested hereunder; and (b) all of the representations and warranties made by Borrower or any other Loan Party under the Credit Agreement or under any of the other Loan Documents are true and correct in all material respects (except in the case of a representation or warranty qualified by materiality, in which case such representation or warranty shall be true and correct in all respects) on and as of the date hereof with the same force and effect as if made on and as of such date, except to the extent such representations or warranties expressly relate solely to an earlier date (in which case such representations and warranties shall have been true and accurate in all material respects (except in the case of a representation or warranty qualified by materiality, in which case such representation or warranty shall be true and correct in all respects) on and as of such earlier date) and except for changes in factual circumstances specifically and expressly permitted under the Credit Agreement or the other Loan Documents. In addition, the Borrower certifies to the Administrative Agent and the Lenders that all conditions to the making of the requested continuation contained in Article VI. of the Credit Agreement will have been satisfied at the time such continuation is made.
CBL & ASSOCIATES LIMITED PARTNERSHIP
By:
CBL Holdings I, Inc., as General Partner
By: ______________________________
Name: ________________________
Title: _________________________
EXHIBIT E
NOTICE OF CONVERSION
CBL & ASSOCIATES
LIMITED PARTNERSHIP
__________ __, 20___
Wells Fargo Bank, National Association
123 North Wacker Drive, Suite 1900
Chicago, Illinois 60606
Attention: __________________
Ladies and Gentlemen:
Reference is made to that certain Eighth Amended and Restated Credit Agreement dated as of November 13, 2012 (as it may be amended from time to time, the "Credit Agreement"), by and among CBL & Associates Limited Partnership (the "Borrower"), CBL & Associates Properties, Inc., Wells Fargo Bank, National Association and the other lenders from time to time party thereto (collectively, together with Assignees under
Section 13.6
thereof, the "Lenders") and Wells Fargo Bank, National Association, as administrative agent (in such capacity, the "Administrative Agent"). Capitalized terms used herein and not otherwise defined herein, have their respective meanings given them in this Credit Agreement.
Pursuant to
Section 2.10
of the Credit Agreement, the Borrower hereby requests a conversion of a Revolving Loan of one Type into a Revolving Loan of another Type, and in that connection sets forth below the information relating to such conversion as required by such
Section 2.10
of the Credit Agreement:
|
|
1.
|
The requested date of such conversion is ___________, 20____.
|
|
|
2.
|
The Type of Revolving Loan to be Converted pursuant hereto is currently:
|
[Check one box only]
□
Base Rate Loan
□
LIBOR Loan
|
|
3.
|
The aggregate principal amount of the Revolving Loan subject to the requested conversion is $__________ and the portion of such principal amount subject to such conversion is $___________.
|
Wells Fargo Bank, National Association
_______________, _____
Page 2
|
|
4.
|
The amount of such Revolving Loan to be converted is to be converted into a Revolving Loan of the following Type:
|
[Check one box only]
□
Base Rate Loan
□
LIBOR Loan with an initial Interest Period for a duration of:
[check one box only]
□
one month
□
three months
□
six months
The Borrower hereby certifies to the Administrative Agent and the Lenders that as of the date hereof, as of the proposed date of the requested conversion, and after giving effect to such conversion, (a) there exists no Default or Event of Default, nor will a Default or Event of Default exist immediately after giving effect to the conversion requested hereunder; and (b) all of the representations and warranties made by Borrower or any other Loan Party under the Credit Agreement or under any of the other Loan Documents are true and correct in all material respects (except in the case of a representation or warranty qualified by materiality, in which case such representation or warranty shall be true and correct in all respects) on and as of the date hereof with the same force and effect as if made on and as of such date, except to the extent such representations or warranties expressly relate solely to an earlier date (in which case such representations and warranties shall have been true and accurate in all material respects (except in the case of a representation or warranty qualified by materiality, in which case such representation or warranty shall be true and correct in all respects) on and as of such earlier date) and except for changes in factual circumstances specifically and expressly permitted under the Credit Agreement or the other Loan Documents. In addition, the Borrower certifies to the Administrative Agent and the Lenders that all conditions to the making of the requested conversion contained in Article VI. of the Credit Agreement will have been satisfied at the time such conversion is made.
CBL & ASSOCIATES LIMITED PARTNERSHIP
By:
CBL Holdings I, Inc., as General Partner
By: ______________________________
Name: ________________________
Title: _________________________
EXHIBIT F
FORM OF NOTICE OF SWINGLINE BORROWING
CBL & ASSOCIATES
LIMITED PARTNERSHIP
____________, 20___
Wells Fargo Bank, National Association
123 North Wacker Drive, Suite 1900
Chicago, Illinois 60606
ATTN: ____________________
Ladies and Gentlemen:
Reference is made to the Eighth Amended and Restated Credit Agreement dated as of November 13, 2012 (as amended, restated, supplemented or otherwise modified from time to time, the “Credit Agreement”), by and CBL & Associates Limited Partnership (the "Borrower"), CBL & Associates Properties, Inc., Wells Fargo Bank, National Association and the other lenders from time to time party thereto (collectively, together with Assignees under
Section 13.6
thereof, the "Lenders") and Wells Fargo Bank, National Association, as administrative agent (in such capacity, "Administrative Agent"). Capitalized terms used herein, and not otherwise defined herein, have their respective meanings given them in the Credit Agreement.
|
|
1.
|
Pursuant to Section 2.3(b) of the Credit Agreement, the Borrower hereby requests that the Swingline Lender make a Swingline Loan to the Borrower in an amount equal to $___________________.
|
|
|
2.
|
The Borrower requests that such Swingline Loan be made available to the Borrower on ____________, 20___.
|
|
|
3.
|
The Borrower requests that the proceeds of such Swingline Loan be made available to the Borrower by ____________________, 20___.
|
The Borrower hereby certifies to the Administrative Agent, the Swingline Lender and the Lenders that as of the date hereof, as of the date of the making of the requested Swingline Loan, and after making such Swingline Loan, (a) the proposed use of the proceeds of such Swingline Loan set forth above is consistent with the provisions of
Section 8.8
of the Credit Agreement; (b) there exists no Default or Event of Default, nor will a Default or Event of Default exist immediately after giving effect to the Swingline Loan requested hereunder; (c) none of the conditions described in Section 2.15. would exist after giving effect to the making of such Swingline Loan; and (d) all of the representations and warranties made by Borrower or any other
Loan Party under the Credit Agreement or under any of the other Loan Documents are true and correct in all material respects (except in the case of a representation or warranty qualified by materiality, in which case such representation or warranty shall be true and correct in all respects) on and as of the date hereof with the same force and effect as if made on and as of such date, except to the extent such representations or warranties expressly relate solely to an earlier date (in which case such representations and warranties shall have been true and accurate in all material respects (except in the case of a representation or warranty qualified by materiality, in which case such representation or warranty shall be true and correct in all respects) on and as of such earlier date) and except for changes in factual circumstances specifically and expressly permitted under the Credit Agreement or the other Loan Documents. In addition, the Borrower certifies to the Administrative Agent and the Lenders that all conditions to the making of the requested Swingline Loan contained in Article VI. of the Credit Agreement will have been satisfied at the time such Swingline Loan is made.
[Continued on next page]
If notice of the requested borrowing of this Swingline Loan was previously given by telephone, this notice is to be considered the written confirmation of such telephone notice required by Section 2.3(b) of the Credit Agreement.
CBL & ASSOCIATES LIMITED PARTNERSHIP
By:
CBL Holdings I, Inc.,
as General Partner
By:_____________________________
Name:
Title:
EXHIBIT G
FORM OF SECOND AMENDED AND RESTATED PARENT GUARANTY
THIS SECOND AMENDED AND RESTATED PARENT GUARANTY (as the same may be amended, restated, supplemented or otherwise modified from time to time, this “Guaranty”) is made as of ____________ __, _____ by CBL & Associates Properties, Inc. (“Guarantor”) in favor of Wells Fargo Bank, National Association, as Administrative Agent (the “Administrative Agent”), for its benefit and for the benefit of the Lenders and the Issuing Bank under the Credit Agreement described below (the Administrative Agent, the Lenders and the Issuing Bank, each individually a “Guaranteed Party” and collectively, the “Guaranteed Parties”). Unless otherwise defined herein, capitalized terms used herein and not defined herein shall have the meanings ascribed to such terms in the Credit Agreement.
W
I
T
N
E
S
S
E
T
H
:
WHEREAS, CBL & Associates Limited Partnership (the “Borrower”), the Guarantor, the financial institutions party thereto from time to time (the “Existing Lenders”), and Wells Fargo Bank, National Association, as Administrative Agent (the “Existing Administrative Agent”) are party to that certain Seventh Amended and Restated Credit Agreement dated as of September 28, 2009 (as amended and in effect immediately prior to the date hereof, the “Existing Credit Agreement”);
WHEREAS, pursuant to the Existing Credit Agreement, the Guarantor entered into an Amended and Restated Guaranty in favor of the Existing Administrative Agent dated as of September 28, 2009 for the benefit of the Existing Lenders under the Existing Credit Agreement (as amended and in effect immediately prior to the date hereof, the “Existing Guaranty”);
WHEREAS, the Borrower, the Guarantor, each of the financial institutions initially a signatory thereto together with their successors and assignees (the “Lenders”) and the Administrative Agent have entered into that certain Eighth Amended and Restated Credit Agreement of even date herewith (as the same may be amended, restated, supplemented or otherwise modified from time to time, the “Credit Agreement”), which Credit Agreement provides, subject to the terms and conditions thereof, for extensions of credit and other financial accommodations to be made by the Lenders to or for the benefit of the Borrower;
WHEREAS, it is a condition precedent to the extensions of credit by the Lenders under the Credit Agreement that the Guarantor agree to amend and restate the Existing Guaranty in the form of this Guaranty, whereby the Guarantor shall guarantee the payment when due of all obligations of CBL Holdings I, Inc., the general partner of the Borrower, and its successors as general partner of the Borrower (hereinafter referred to as the “General Partner”) pursuant to the Loan Documents (subject to the limitations set forth in Section 13.21. of the Credit Agreement);
WHEREAS, it is a condition precedent to the extensions of credit by the Lenders under the Credit Agreement that certain Subsidiaries of the Borrower (collectively, the “Subsidiary Guarantors”) enter into that certain Second Amended and Restated Guaranty, dated as of the date hereof in favor of the Administrative Agent (the “Subsidiary Guaranty”); and
WHEREAS, in consideration of the direct and indirect financial and other support and benefits that the Borrower has provided, and such direct and indirect financial and other support and benefits as the Borrower may in the future provide, to the Guarantor, which significantly facilitates the business operations of the Borrower and the Guarantor, and in order to induce the Lenders and the Administrative Agent to enter into the Credit Agreement, and to make the Loans and the other financial accommodations
to the Borrower and to issue the Letters of Credit described in the Credit Agreement, the Guarantor is willing to guarantee the payment when due of all obligations of the General Partner under the Loan Documents;
NOW, THEREFORE, in consideration of the foregoing premises and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:
SECTION 1.
Representations, Warranties and Covenants
. The Guarantor represents and warrants to each Guaranteed Party and the Administrative Agent as of the date of this Guaranty, giving effect to the consummation of the transactions contemplated by the Loan Documents on the Effective Date, and thereafter on each date as required by Section 6.2. of the Credit Agreement that:
(a)
It is a corporation, duly organized, validly existing and in good standing under the jurisdiction of its incorporation, has the power and authority to own or lease its properties and to carry on its business as now being and hereafter proposed to be conducted and is duly qualified and is in good standing as a domestic or foreign corporation, and authorized to do business, in each jurisdiction in which the character of its properties or the nature of its business requires such qualification or authorization and where the failure to be so qualified or authorized could reasonably be expected to have, in each instance, a Material Adverse Effect.
(b)
It has the right and power, and has taken all necessary action to authorize it, to execute, deliver and perform this Guaranty in accordance with its terms and to perform its obligations hereunder. This Guaranty has been duly executed and delivered by the duly authorized officers of the Guarantor and is a legal, valid and binding obligation of the Guarantor enforceable against the Guarantor in accordance with its terms, except as the same may be limited by bankruptcy, insolvency, and other similar laws affecting the rights of creditors generally and the availability of equitable remedies for the enforcement of certain obligations contained herein and as may be limited by equitable principles generally.
(c)
The execution, delivery and performance of this Guaranty in accordance with its terms and the obligations hereunder do not and will not, by the passage of time, the giving of notice, or both: (i) require any Governmental Approval or violate any Applicable Law (including all Environmental Laws) relating to the Guarantor; (ii) conflict with, result in a breach of or constitute a default under the organizational documents of the Guarantor, or any indenture, agreement or other instrument to which the Guarantor is a party or by which it or any of its respective properties may be bound; or (iii) result in or require the creation or imposition of any Lien upon or with respect to any Property now owned or hereafter acquired by the Guarantor other than in favor of the Administrative Agent for its benefit and the benefit of the Guaranteed Parties and the Issuing Bank. It is in compliance with each Governmental Approval and all other Applicable Laws relating to it except for non-compliances which, and Governmental Approvals the failure to possess which, could not, individually or in the aggregate, reasonably be expected to cause a Default or Event of Default or have a Material Adverse Effect.
(d)
It has no Indebtedness other than Indebtedness permitted under the Credit Agreement.
In addition to the foregoing, the Guarantor covenants that, so long as any Guaranteed Party has any Revolving Commitment, Swingline Commitment or Letter of Credit outstanding under the Credit Agreement or any amount payable under the Credit Agreement or any other Obligations shall remain unpaid, it will, and, if necessary, will cause the Borrower and the General Partner to, fully comply with those covenants and agreements of the Borrower and the General Partner applicable to the Guarantor set forth in the Credit Agreement.
SECTION 2.
The Guaranty
. The Guarantor hereby irrevocably and unconditionally guarantees the full and punctual payment and performance when due (whether at stated maturity, upon acceleration or otherwise) of all obligations of the General Partner now or hereafter existing under the Credit Agreement, the Notes issued thereunder and the other Loan Documents executed in connection therewith (subject to the limitations set forth in Section 13.21. of the Credit Agreement) (all of the foregoing being referred to collectively as the “Guaranteed Obligations”). Upon the failure by the Borrower, the General Partner, or any of their respective Affiliates, as applicable, to pay punctually or perform the Guaranteed Obligations, subject to any applicable grace or notice and cure period, the Guarantor agrees that it shall forthwith on demand pay such amount or perform such obligation at the place and in the manner specified in the Credit Agreement or the relevant other Loan Document, as the case may be. The Guarantor hereby agrees that this Guaranty is an absolute, irrevocable and unconditional guaranty of payment and is not a guaranty of collection.
SECTION 3.
Guaranty Unconditional
. The obligations of the Guarantor hereunder shall be unconditional and absolute and, without limiting the generality of the foregoing, shall not be released, discharged or otherwise affected by:
(i)
any extension, renewal, settlement, indulgence, compromise, waiver or release of or with respect to the Guaranteed Obligations or any part thereof or any agreement relating thereto, or with respect to any obligation of any other guarantor of any of the Guaranteed Obligations, whether (in any such case) by operation of law or otherwise, or any failure or omission to enforce any right, power or remedy with respect to the Guaranteed Obligations or any part thereof or any agreement relating thereto, or with respect to any obligation of any other guarantor of any of the Guaranteed Obligations;
(ii)
any modification or amendment of or supplement to the Credit Agreement or any other Loan Document, including, without limitation, any such amendment which may increase the amount of, or the interest rates applicable to, any of the Guaranteed Obligations guaranteed hereby;
(iii)
any release, surrender, compromise, settlement, waiver, subordination or modification, with or without consideration, of any other guaranties with respect to the Guaranteed Obligations or any part thereof, or any other obligation of any person or entity with respect to the Guaranteed Obligations or any part thereof;
(iv)
any change in the corporate, partnership, limited liability company or other existence, structure or ownership of the Borrower, the General Partner or any other guarantor of any of the Guaranteed Obligations, or any insolvency, bankruptcy, reorganization or other similar proceeding affecting the Borrower, the General Partner or any other guarantor of the Guaranteed Obligations, or any of their respective assets or any resulting release or discharge of any obligation of the Borrower, the General Partner or any other guarantor of any of the Guaranteed Obligations;
(v)
the existence of any claim, setoff or other rights which the Guarantor may have at any time against the Borrower, the General Partner, any other guarantor of any of the Guaranteed Obligations, the Administrative Agent, any Guaranteed Party or any other Person, whether in connection herewith or in connection with any unrelated transactions,
provided
that nothing herein shall prevent the assertion of any such claim by separate suit or compulsory counterclaim;
(vi)
the enforceability or validity of the Guaranteed Obligations or any part thereof or the genuineness, enforceability or validity of any agreement relating thereto, or any other
invalidity or unenforceability relating to or against the Borrower, the General Partner or any other guarantor of any of the Guaranteed Obligations, for any reason related to the Credit Agreement or any other Loan Document, or any provision of applicable law, decree, order or regulation purporting to prohibit the payment by the Borrower, the General Partner or any other guarantor of the Guaranteed Obligations, of any of the Guaranteed Obligations or otherwise affecting any term of any of the Guaranteed Obligations;
(vii)
the election by, or on behalf of, any one or more of the Guaranteed Parties, in any proceeding instituted under Chapter 11 of Title 11 of the United States Code (11 U.S.C. 101 et seq.) (or any successor statute, the “
Bankruptcy Code
”), of the application of Section 1111(b)(2) of the Bankruptcy Code;
(viii)
any borrowing or grant of a security interest by the Borrower or the General Partner, as debtor-in-possession, under Section 364 of the Bankruptcy Code;
(ix)
the disallowance, under Section 502 of the Bankruptcy Code, of all or any portion of the claims of the Guaranteed Parties or the Administrative Agent for repayment of all or any part of the Guaranteed Obligations;
(x)
the failure of any other guarantor to sign or become party to this Guaranty or any amendment, change, or reaffirmation hereof; or
(xi)
any other act or omission to act or delay of any kind by the Borrower, the General Partner, any other guarantor of the Guaranteed Obligations, the Administrative Agent, any Guaranteed Party or any other Person or any other circumstance whatsoever which might, but for the provisions of this Section 3, constitute a legal or equitable discharge of the Guarantor's obligations hereunder or otherwise reduce, release, prejudice or extinguish its liability under this Guaranty.
SECTION 4.
Discharge Only Upon Payment In Full; Reinstatement In Certain Circumstances
. The Guarantor's obligations hereunder shall remain in full force and effect until all Guaranteed Obligations shall have been paid in full in cash (other than Unliquidated Obligations that have not yet arisen) and the Revolving Commitments and Swingline Commitments and all Letters of Credit issued under the Credit Agreement shall have terminated or expired or, in the case of all Letters of Credit, are fully collateralized on terms reasonably acceptable to the Administrative Agent, at which time, subject to all the foregoing conditions, the guarantees made hereunder shall automatically terminate. If at any time any payment of the principal of or interest on any Loan, Obligation or any other amount payable by the Borrower, the General Partner or any other party under the Credit Agreement or any other Loan Document (including a payment effected through exercise of a right of setoff) is rescinded, or is or must be otherwise restored or returned upon the insolvency, bankruptcy or reorganization of the Borrower or the General Partner or otherwise (including pursuant to any settlement entered into by a Guaranteed Party in its discretion), the 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. “Unliquidated Obligations” means at any time, any Obligations (or portion thereof) that are contingent in nature or unliquidated at such time, including any Obligation that is: (i) an obligation under the Credit Agreement to reimburse the Issuing Bank for drawings not yet made under a Letter of Credit issued by it; (ii) any other obligation (including any guarantee) under the Credit Agreement that is contingent in nature at such time; or (iii) an obligation under the Credit Agreement to provide collateral to secure any of the foregoing types of obligations.
SECTION 5.
General Waivers; Additional Waivers
.
(a)
General Waivers
. The Guarantor irrevocably waives acceptance hereof, presentment, demand or action on delinquency, protest, the benefit of any statutes of limitations and, to the fullest extent permitted by law, any notice not provided for herein or under the other Loan Documents, as well as any requirement that at any time any action be taken by any Person against the Borrower, the General Partner, any other guarantor of the Guaranteed Obligations, or any other Person.
(b)
Additional Waivers
. Notwithstanding anything herein to the contrary, the Guarantor hereby absolutely, unconditionally, knowingly, and expressly waives, to the fullest extent permitted by law:
(i) any right it may have to revoke this Guaranty as to future indebtedness or notice of acceptance hereof;
(ii) (1) notice of acceptance hereof; (2) notice of any Loans, Letters of Credit or other financial accommodations made or extended under the Loan Documents or the creation or existence of any Guaranteed Obligations; (3) notice of the amount of the Guaranteed Obligations, subject, however, to the Guarantor's right to make inquiry of the Administrative Agent and the Guaranteed Parties to ascertain the amount of the Guaranteed Obligations at any reasonable time; (4) notice of any adverse change in the financial condition of the Borrower or the General Partner or of any other fact that might increase the Guarantor's risk hereunder; (5) notice of presentment for payment, demand, protest, and notice thereof as to any instruments among the Loan Documents; (6) notice of any Default or Event of Default; and (7) all other notices (except if such notice is specifically required to be given to the Guarantor hereunder or under the Loan Documents) and demands to which the Guarantor might otherwise be entitled;
(iii) its right, if any, to require the Administrative Agent and the other Guaranteed Parties to institute suit against, or to exhaust any rights and remedies which the Administrative Agent and the other Guaranteed Parties has or may have against, the General Partner, the Subsidiary Guarantors or any third party; and the Guarantor further waives any defense arising by reason of any disability or other defense (other than the defense that the Guaranteed Obligations shall have been fully and finally performed and indefeasibly paid in full in cash) of the General Partner or the Subsidiary Guarantors or by reason of the cessation from any cause whatsoever of the liability of the General Partner or the Subsidiary Guarantors in respect thereof;
(iv) (a) any rights to assert against the Administrative Agent and the other Guaranteed Parties any defense (legal or equitable), set-off, counterclaim, or claim which the Guarantor may now or at any time hereafter have against the General Partner, the Subsidiary Guarantors or any other party liable to the Administrative Agent and the other Guaranteed Parties unless due to the
gross negligence or willful misconduct of the Administrative Agent or such Guaranteed Party as determined by a court of competent jurisdiction in a final non-appealable judgment
; (b) any defense, set-off, counterclaim, or claim, of any kind or nature, arising directly or indirectly from the present or future lack of sufficiency, validity, or enforceability of the Guaranteed Obligations; (c) any defense the Guarantor has to performance hereunder, and any right the Guarantor has to be exonerated, arising by reason of: (1) the impairment or suspension of the Administrative Agent's and the other Guaranteed Parties' rights or remedies against the other guarantor of the Guaranteed Obligations; (2) the alteration by the Administrative Agent and the other Guaranteed Parties of the Guaranteed Obligations; (3) any discharge of the obligations of the General Partner or the Subsidiary Guarantors to the Administrative Agent and the other Guaranteed Parties by operation of law as a result of the Administrative Agent's and the other Guaranteed Parties' intervention or omission; or (4) the acceptance by the Administrative Agent and the other Guaranteed Parties of anything in partial satisfaction of the Guaranteed Obligations;
and (d) the benefit of any statute of limitations affecting the Guarantor's liability hereunder or the enforcement thereof, and any act which shall defer or delay the operation of any statute of limitations applicable to the Guaranteed Obligations shall similarly operate to defer or delay the operation of such statute of limitations applicable to the Guarantor's liability hereunder; and
(v) any defense arising by reason of or deriving from (a) any claim or defense based upon an election of remedies by the Administrative Agent and the Guaranteed Parties; or (b) any election by the Administrative Agent and the other Guaranteed Parties under the Bankruptcy Code, to limit the amount of its claim against the Guarantor.
SECTION 6.
Subordination of Subrogation; Subordination of Intercompany Indebtedness
.
(a)
Subordination of Subrogation
. Until the Guaranteed Obligations have been fully and finally performed and indefeasibly paid in full in cash (other than Unliquidated Obligations), the Guarantor (i) shall have no right of subrogation with respect to such Guaranteed Obligations and (ii) waives any right to enforce any remedy which the Issuing Bank, any of the Guaranteed Parties or the Administrative Agent now have or may hereafter have against the Borrower, the General Partner, any endorser or any guarantor of all or any part of the Guaranteed Obligations or any other Person. Should the Guarantor have the right, notwithstanding the foregoing, to exercise its subrogation rights, the Guarantor hereby expressly and irrevocably (A) subordinates any and all rights at law or in equity to subrogation, reimbursement, exoneration, contribution, indemnification or set off that the Guarantor may have to the payment in full in cash of the Guaranteed Obligations until the Guaranteed Obligations are indefeasibly paid in full in cash (other than Unliquidated Obligations) and (B) waives any and all defenses available to a surety, guarantor or accommodation co-obligor until the Guaranteed Obligations are indefeasibly paid in full in cash (other than Unliquidated Obligations that have not yet arisen). The Guarantor acknowledges and agrees that this subordination is intended to benefit the Administrative Agent and the Guaranteed Parties and shall not limit or otherwise affect the Guarantor's liability hereunder or the enforceability of this Guaranty, and that the Administrative Agent, the Guaranteed Parties and their respective successors and assigns are intended third party beneficiaries of the waivers and agreements set forth in this Section 6(a).
(b)
Subordination of Intercompany Indebtedness
. The Guarantor agrees that any and all claims of the Guarantor against the Borrower, the General Partner or any Subsidiary Guarantor (each an “Obligor”) with respect to any “Intercompany Indebtedness” (as hereinafter defined), any endorser, obligor or any other guarantor of all or any part of the Guaranteed Obligations, or against any of its properties shall be subordinate and subject in right of payment to the prior payment, in full and in cash, of all Guaranteed Obligations; provided that, as long as no Event of Default has occurred and is continuing, the Guarantor may receive payments of principal and interest from any Obligor with respect to Intercompany Indebtedness. Notwithstanding any right of the Guarantor to ask, demand, sue for, take or receive any payment from any Obligor, all rights, liens and security interests of the Guarantor, whether now or hereafter arising and howsoever existing, in any assets of any other Obligor shall be and are subordinated to the rights of the Guaranteed Parties and the Administrative Agent in those assets. The Guarantor shall not have any right to possession of any such asset or to foreclose upon any such asset, whether by judicial action or otherwise, unless and until all of the Guaranteed Obligations shall have been fully paid and satisfied (in cash) and all financing arrangements pursuant to any Loan Document have been terminated. If all or any part of the assets of any Obligor, or the proceeds thereof, are subject to any distribution, division or application to the creditors of such Obligor, whether partial or complete, voluntary or involuntary, and whether by reason of liquidation, bankruptcy, arrangement, receivership, assignment for the benefit of creditors or any other action or proceeding, or if the business of any such Obligor is dissolved or if substantially all of the assets of any such Obligor are sold, then, and in any such event (such events being herein referred to as an “
Insolvency Event
”), any payment or distribution of any
kind or character, either in cash, securities or other property, which shall be payable or deliverable upon or with respect to any indebtedness of any Obligor to the Guarantor (“
Intercompany Indebtedness
”) shall be paid or delivered directly to the Administrative Agent for application on any of the Guaranteed Obligations, due or to become due, until such Guaranteed Obligations shall have first been fully paid and satisfied (in cash). Should any payment, distribution, security or instrument or proceeds thereof be received by the Guarantor upon or with respect to the Intercompany Indebtedness after any Insolvency Event and prior to the satisfaction of all of the Guaranteed Obligations and the termination of all financing arrangements pursuant to any Loan Document among the Borrower or the General Partner and the Guaranteed Parties, the Guarantor shall receive and hold the same in trust, as trustee, for the benefit of the Guaranteed Parties and shall forthwith deliver the same to the Administrative Agent, for the benefit of the Guaranteed Parties, in precisely the form received (except for the endorsement or assignment of the Guarantor where necessary), for application to any of the Guaranteed Obligations, due or not due, and, until so delivered, the same shall be held in trust by the Guarantor as the property of the Guaranteed Parties. If the Guarantor fails to make any such endorsement or assignment to the Administrative Agent, the Administrative Agent or any of its officers or employees is irrevocably authorized to make the same. The Guarantor agrees that until the Guaranteed Obligations (other than the Unliquidated Obligations) have been paid in full (in cash) and satisfied and all financing arrangements pursuant to any Loan Document among the Borrower or the General Partner and the Guaranteed Parties have been terminated, the Guarantor will not assign or transfer to any Person (other than the Administrative Agent) any claim the Guarantor has or may have against any Obligor.
SECTION 7.
[
Reserved
]
.
SECTION 8.
Limitation of Guaranty
. Notwithstanding any other provision of this Guaranty, the amount guaranteed by the Guarantor hereunder shall be limited to the extent, if any, required so that its obligations hereunder shall not be subject to avoidance under Section 548 of the Bankruptcy Code or under any applicable state Uniform Fraudulent Transfer Act, Uniform Fraudulent Conveyance Act or similar statute or common law. In determining the limitations, if any, on the amount of the Guarantor's obligations hereunder pursuant to the preceding sentence, it is the intention of the parties hereto that any rights of subrogation, indemnification or contribution which the Guarantor may have under this Guaranty, any other agreement or applicable law shall be taken into account.
SECTION 9.
Stay of Acceleration
. If acceleration of the time for payment of any amount payable by the Borrower or the General Partner under the Credit Agreement or any other Loan Document is stayed upon the insolvency, bankruptcy or reorganization of the Borrower, the General Partner or any of their respective Affiliates, all such amounts otherwise subject to acceleration under the terms of the Credit Agreement or any other Loan Document shall nonetheless be payable by the Guarantor hereunder forthwith on demand by the Administrative Agent.
SECTION 10.
Notices
. All notices, requests and other communications to any party hereunder shall be given in the manner prescribed in Section 13.1. of the Credit Agreement with respect to the Administrative Agent at its notice address therein and, with respect to the Guarantor, in the care of the Borrower at the address of the Borrower set forth in the Credit Agreement, or such other address or telecopy number as such party may hereafter specify for such purpose in accordance with the provisions of Section 13.1. of the Credit Agreement.
SECTION 11.
No Waivers
. No failure or delay by the Administrative Agent or any Guaranteed Party in exercising any right, power or privilege hereunder shall operate as a waiver thereof nor shall any single or partial exercise thereof preclude any other or further exercise thereof or the exercise of any other right, power or privilege. The rights and remedies provided in this Guaranty, the Credit Agreement and the other Loan Documents shall be cumulative and not exclusive of any rights or remedies provided by
law.
SECTION 12.
Successors and Assigns
. This Guaranty is for the benefit of the Administrative Agent and the Guaranteed Parties and their respective successors and permitted assigns,
provided
, that the Guarantor shall not have any right to assign its rights or obligations hereunder without the consent of the Administrative Agent, and any such assignment in violation of this Section 12 shall be null and void; and in the event of an assignment of any amounts payable under the Credit Agreement or the other Loan Documents in accordance with the respective terms thereof, the rights hereunder, to the extent applicable to the indebtedness so assigned, may be transferred with such indebtedness. This Guaranty shall be binding upon the Guarantor and its successors and assigns.
SECTION 13.
Changes in Writing
. Other than in connection with the addition of additional Subsidiaries, which become parties hereto by executing a Guaranty Supplement hereto in the form attached as
Annex I
, neither this Guaranty nor any provision hereof may be changed, waived, discharged or terminated orally, but only in writing signed by the Guarantor and the Administrative Agent.
SECTION 14.
Governing Law; Jurisdiction
.
(a) THIS GUARANTY
SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO CONTRACTS EXECUTED, AND TO BE FULLY PERFORMED, IN SUCH STATE
.
(b) EACH PARTY HERETO ACKNOWLEDGES THAT ANY DISPUTE OR CONTROVERSY BETWEEN THE GUARANTOR OR THE ADMINISTRATIVE AGENT WOULD BE BASED ON DIFFICULT AND COMPLEX ISSUES OF LAW AND FACT AND WOULD RESULT IN DELAY AND EXPENSE TO THE PARTIES. ACCORDINGLY, TO THE EXTENT PERMITTED BY APPLICABLE LAW, THE ADMINISTRATIVE AGENT AND THE GUARANTOR HEREBY WAIVES ITS RIGHT TO A TRIAL BY JURY IN ANY ACTION OR PROCEEDING OF ANY KIND OR NATURE IN ANY COURT OR TRIBUNAL IN WHICH AN ACTION MAY BE COMMENCED BY OR AGAINST ANY PARTY HERETO ARISING OUT OF THIS GUARANTY, THE CREDIT AGREEMENT, THE NOTES, OR ANY OTHER LOAN DOCUMENT OR THE FEE LETTER OR BY REASON OF ANY OTHER SUIT, CAUSE OF ACTION OR DISPUTE WHATSOEVER BETWEEN OR AMONG THE BORROWER, THE GUARANTOR, THE GENERAL PARTNER, THE SUBSIDIARY GUARANTORS, THE ADMINISTRATIVE AGENT, THE ISSUING BANK OR ANY OF THE LENDERS OF ANY KIND OR NATURE.
(c) THE GUARANTOR IRREVOCABLY AND UNCONDITIONALLY AGREES THAT IT WILL NOT COMMENCE ANY ACTION, LITIGATION OR PROCEEDING OF ANY KIND OR DESCRIPTION, WHETHER IN LAW OR EQUITY, WHETHER IN CONTRACT OR IN TORT OR OTHERWISE, AGAINST THE ADMINISTRATIVE AGENT, ANY LENDER, THE ISSUING BANK, OR ANY RELATED PARTY OF THE FOREGOING IN ANY WAY RELATING TO THIS GUARANTY OR ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS RELATING HERETO OR THERETO, IN ANY FORUM OTHER THAN THE COURTS OF THE STATE OF NEW YORK 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, AND EACH OF THE PARTIES HERETO IRREVOCABLY AND UNCONDITIONALLY
SUBMITS TO THE JURISDICTION OF SUCH COURTS AND AGREES THAT ALL CLAIMS IN RESPECT OF ANY SUCH ACTION, LITIGATION OR PROCEEDING MAY BE HEARD AND DETERMINED IN SUCH NEW YORK STATE COURT OR, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, IN SUCH FEDERAL COURT. EACH OF THE PARTIES HERETO AGREES THAT A FINAL, NON-APPEALABLE JUDGMENT IN ANY SUCH ACTION, LITIGATION 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 OR IN ANY OTHER LOAN DOCUMENT SHALL AFFECT ANY RIGHT THAT THE ADMINISTRATIVE AGENT, ANY LENDER OR THE ISSUING BANK 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. EACH PARTY FURTHER WAIVES ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH ACTION OR PROCEEDING IN ANY SUCH COURT OR THAT SUCH ACTION OR PROCEEDING WAS BROUGHT IN AN INCONVENIENT FORUM AND EACH AGREES NOT TO PLEAD OR CLAIM THE SAME. THE CHOICE OF FORUM SET FORTH IN THIS SECTION SHALL NOT BE DEEMED TO PRECLUDE THE BRINGING OF ANY ACTION BY THE ADMINISTRATIVE AGENT, THE ISSUING BANK OR ANY LENDER OR THE ENFORCEMENT BY THE ADMINISTRATIVE AGENT, THE ISSUING BANK OR ANY LENDER OF ANY JUDGMENT OBTAINED IN SUCH FORUM IN ANY OTHER APPROPRIATE JURISDICTION.
(d) THE GUARANTOR HEREBY WAIVES PERSONAL SERVICE OF THE SUMMONS AND COMPLAINT, OR OTHER PROCESS OR PAPERS ISSUED THEREIN, AND AGREES THAT SERVICE OF SUCH SUMMONS AND COMPLAINT, OR OTHER PROCESS OR PAPERS MAY BE MADE BY REGISTERED OR CERTIFIED MAIL ADDRESSED TO THE BORROWER AT ITS ADDRESS FOR NOTICES PROVIDED FOR IN THE CREDIT AGREEMENT. SHOULD THE GUARANTOR FAIL TO APPEAR OR ANSWER ANY SUMMONS, COMPLAINT, PROCESS OR PAPERS SO SERVED WITHIN THIRTY (30) DAYS AFTER THE MAILING THEREOF, THE GUARANTOR SHALL BE DEEMED IN DEFAULT AND AN ORDER AND/OR JUDGMENT MAY BE ENTERED AGAINST IT AS DEMANDED OR PRAYED FOR IN SUCH SUMMONS, COMPLAINT, PROCESS OR PAPERS.
(e)
THE PROVISIONS OF THIS SECTION HAVE BEEN CONSIDERED BY EACH PARTY WITH THE ADVICE OF COUNSEL AND WITH A FULL UNDERSTANDING OF THE LEGAL CONSEQUENCES THEREOF, AND SHALL SURVIVE THE PAYMENT OF THE LOANS AND ALL OTHER GUARANTEED OBLIGATIONS, THE TERMINATION OR EXPIRATION OF ALL LETTERS OF CREDIT, THE TERMINATION OF THE CREDIT AGREEMENT AND THE TERMINATION OF THIS GUARANTY
.
SECTION 15.
No Strict Construction
. The parties hereto have participated jointly in the negotiation and drafting of this Guaranty. In the event an ambiguity or question of intent or interpretation arises, this Guaranty shall be construed as if drafted jointly by the parties hereto and no presumption or
burden of proof shall arise favoring or disfavoring any party by virtue of the authorship of any provisions of this Guaranty.
SECTION 16.
Taxes; Expenses of Enforcement, Etc.
(a)
Taxes
. All payments by the Guarantor of principal of, and interest on, the Loans and all other Obligations shall be made free and clear of and without deduction for any Taxes. If any withholding or deduction from any payment to be made by the Guarantor hereunder is required in respect of any Taxes pursuant to any Applicable Law, then the Guarantor will:
(i)
pay directly to the relevant Governmental Authority the full amount required to be so withheld or deducted;
(ii)
promptly forward to the Administrative Agent an official receipt or other documentation satisfactory to the Administrative Agent evidencing such payment to such Governmental Authority; and
(iii)
pay to the Administrative Agent for its account or the account of the applicable Lender or the Issuing Bank, as the case may be, such additional amount or amounts as is necessary to ensure that the net amount actually received by the Administrative Agent, the Issuing Bank or such Lender will equal the full amount that the Administrative Agent, the Issuing Bank or such Lender would have received had no such withholding or deduction been required.
(iv)
If the Guarantor fails to pay any Taxes when due to the appropriate Governmental Authority or fails to remit to the Administrative Agent, for its account or the account of the Issuing Bank or respective Lender, as the case may be, the required receipts or other required documentary evidence, the Guarantor shall indemnify the Administrative Agent, the Issuing Bank and the Lenders for any incremental Taxes, interest or penalties that may become payable by the Administrative Agent, the Issuing Bank or any Lender as a result of any such failure.
(v)
By accepting the benefits hereof, each Lender agrees that it will comply with Section 3.10.(c) of the Credit Agreement.
(b) The Guarantor agrees to reimburse the Guaranteed Parties for any reasonable costs and out-of-pocket expenses (including attorneys' fees) paid or incurred by any Guaranteed Party in connection with the collection and enforcement of the Guaranteed Obligations.
SECTION 17.
Setoff
. In addition to any rights now or hereafter granted under any of the other Loan Documents or Applicable Law and not by way of limitation of any such rights, the Guarantor hereby authorizes each Guaranteed Party and each Participant, at any time while an Event of Default exists, without any prior notice to the Guarantor or to any other Person, any such notice being hereby expressly waived, but in the case of a Lender, the Issuing Bank or a Participant subject to receipt of the prior written consent of the Administrative Agent and Requisite Lenders, exercised in their sole discretion, to set-off and to appropriate and to apply any and all deposits (general or special, including, but not limited to, indebtedness evidenced by certificates of deposit, whether matured or unmatured) and any other indebtedness at any time held or owing by the Administrative Agent, the Issuing Bank, such Lender or such Participant or any affiliate of the Administrative Agent, the Issuing Bank, or such Lender to or for the credit or the account of the Guarantor against and on account of any of the Guaranteed Obligations, although such obligations shall be contingent or unmatured. The Guarantor agrees, to the fullest extent permitted by Applicable Law, that any Participant may exercise rights of setoff or
counterclaim and other rights with respect to its participation as fully as if such Participant were a direct creditor of the Guarantor in the amount of such participation.
SECTION 18.
Financial Information
. The Guarantor hereby assumes responsibility for keeping itself informed of the financial condition of the Borrower, the General Partner, the Subsidiary Guarantors and any and all endorsers and/or other guarantors of all or any part of the Guaranteed Obligations, and of all other circumstances bearing upon the risk of nonpayment of the Guaranteed Obligations, or any part thereof, that diligent inquiry would reveal, and the Guarantor hereby agrees that none of the Guaranteed Parties or the Administrative Agent shall have any duty to advise the Guarantor of information known to any of them regarding such condition or any such circumstances. In the event any Guaranteed Party or the Administrative Agent, in its sole discretion, undertakes at any time or from time to time to provide any such information to the Guarantor, such Guaranteed Party or the Administrative Agent shall be under no obligation (i) to undertake any investigation not a part of its regular business routine, (ii) to disclose any information which such Guaranteed Party or the Administrative Agent, pursuant to accepted or reasonable commercial finance or banking practices, wishes to maintain confidential or (iii) to make any other or future disclosures of such information or any other information to the Guarantor.
SECTION 19.
Severability
. Wherever possible, each provision of this Guaranty shall be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Guaranty shall be prohibited by or invalid under such law, such provision shall be ineffective to the extent of such prohibition or invalidity without invalidating the remainder of such provision or the remaining provisions of this Guaranty.
SECTION 20.
Merger
. This Guaranty represents the final agreement of the Guarantor with respect to the matters contained herein and may not be contradicted by evidence of prior or contemporaneous agreements, or subsequent oral agreements, between the Guarantor and any Guaranteed Party or the Administrative Agent.
SECTION 21.
Headings
. Section headings in this Guaranty are for convenience of reference only and shall not govern the interpretation of any provision of this Guaranty.
SECTION 22.
[
Reserved
]
.
SECTION 23.
AMENDMENT, RESTATEMENT AND CONSOLIDATION; NO NOVATION
. THE EXISTING GUARANTY IS BEING AMENDED, RESTATED AND CONSOLIDATED IN ITS ENTIRETY BY THIS GUARANTY FOR THE CONVENIENCE OF THE PARTIES. THIS GUARANTY MERELY AMENDS, MODIFIES, RESTATES AND CONSOLIDATES THE OBLIGATIONS EVIDENCED BY THE EXISTING GUARANTY AND DOES NOT CONSTITUTE, AND IT IS THE EXPRESS INTENT OF THE PARTIES HERETO THAT THIS GUARANTY DOES NOT EFFECT, A NOVATION OF THE EXISTING OBLIGATIONS OF THE GUARANTOR UNDER THE EXISTING GUARANTY. ALL SUCH OBLIGATIONS CONTINUE TO REMAIN OUTSTANDING AND EVIDENCED BY THIS GUARANTY. THE AMENDMENT, RESTATEMENT AND CONSOLIDATION EFFECTED HEREBY SHALL BE DEEMED TO HAVE PROSPECTIVE APPLICATION ONLY FROM AND AFTER THE EFFECTIVE DATE, UNLESS OTHERWISE EXPRESSLY STATED HEREIN.
[
SIGNATURE PAGES TO FOLLOW
]
IN WITNESS WHEREOF, the Guarantor has caused this Guaranty to be duly executed by its authorized officer as of the day and year first above written.
|
|
|
|
CBL & Associates Properties, Inc.
By:______________________________
Name:
Title:
|
Acknowledged and Agreed to:
WELLS FARGO BANK, NATIONAL ASSOCIATION, as Administrative Agent
By:__________________________________
Name:
Title:
EXHIBIT H
Form of
[
AMENDED AND RESTATED
]
REVOLVING NOTE
CBL & ASSOCIATES
LIMITED PARTNERSHIP
$______________
_________, 20__
FOR VALUE RECEIVED, the undersigned, CBL & Associates Limited Partnership (the “Borrower”) hereby unconditionally promises to pay to the order of ___________________________ (the “Lender”), in care of Wells Fargo Bank, National Association, as Administrative Agent (the “Administrative Agent”), to Wells Fargo Bank, National Association, 123 North Wacker Drive, Suite 1900, Chicago IL, 60606, or at such other address as may be specified by the Administrative Agent to the Borrower, the principal sum of ___________________ AND ___/100 DOLLARS ($_____________), or such lesser amount as may be the then outstanding and unpaid balance of all Revolving Loans made by the Lender to the Borrower pursuant to, and in accordance with the terms of, the Credit Agreement.
The Borrower further agrees to pay interest at said office, in like money, on the unpaid principal amount owing hereunder from time to time on the dates and at the rates and at the times specified in the Credit Agreement.
This
[
Amended and Restated
]
Revolving Note (this “Note”) is one of the “Revolving Notes” referred to in the Eighth Amended and Restated Credit Agreement dated as of November 13, 2012 (as amended, restated, supplemented or otherwise modified from time to time, the “Credit Agreement”), by and among the Borrower, the financial institutions party thereto and their assignees under Section 13.6. thereof, the Administrative Agent, and the other parties thereto, and is subject to, and entitled to, all provisions and benefits thereof. Capitalized terms used herein and not defined herein shall have the respective meanings given to such terms in the Credit Agreement. The Credit Agreement, among other things, (a) provides for the making of Revolving Loans by the Lender to the Borrower from time to time in an aggregate amount not to exceed at any time outstanding the Dollar amount first above mentioned, (b) permits the prepayment of the Loans by the Borrower subject to certain terms and conditions and (c) provides for the acceleration of the Revolving Loans upon the occurrence of certain specified events.
The Borrower hereby waives presentment, demand, protest and notice of any kind. No failure to exercise, and no delay in exercising any rights hereunder on the part of the holder hereof shall operate as a waiver of such rights.
Time is of the essence for this Note.
[
This Note is given in replacement of the Revolving Note dated _____ __, 20__, in the original principal amount of $_______ previously delivered to the Lender under the
Credit Agreement. THIS NOTE IS NOT INTENDED TO BE, AND SHALL NOT BE CONSTRUED TO BE, A NOVATION OF ANY OF THE OBIGATIONS OWING UNDER OR IN CONNECTION WITH THE OTHER NOTE.
]
[
The principal amount of this Note includes the indebtedness heretofore evidenced by that certain Promissory Note issued to the Bank dated September 28, 2009 (the “Existing Note”). This Note is given in substitution for and not in payment of the Existing Note and is in no way intended to constitute a novation of the Borrower's indebtedness which was evidenced by the Existing Note.
]
1
CBL Holdings I, Inc., Borrower's sole general partner, its successors and assigns (the “General Partner”), shall not be personally liable for the payment of this Note except to the extent set forth in Section 13.21 of the Credit Agreement.
THIS NOTE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO CONTRACTS EXECUTED, AND TO BE FULLY PERFORMED, IN SUCH STATE.
____________________________
1
Language to be included in case of an assignment and need to issue a replacement note to an existing Lender, either because such Lender's Commitment has increased or decreased from what it was initially.
IN WITNESS WHEREOF, the undersigned has executed and delivered this Revolving Note under seal as of the date written above.
CBL & ASSOCIATES LIMITED PARTNERSHIP
By:
CBL Holdings I, Inc.,
as General Partner
By:______________________________
Name:
Title:
EXHIBIT I
FORM OF SWINGLINE NOTE
CBL & ASSOCIATES
LIMITED PARTNERSHIP
$________________
___________ ___, 20__
FOR VALUE RECEIVED, the undersigned, CBL & Associates Limited Partnership (the “Borrower”), hereby promises to pay to the order of Wells Fargo Bank, National Association (the “Swingline Lender”) to its address at 123 North Wacker Drive, Suite 1900, Chicago, IL 60606,or at such other address as may be specified by the Swingline Lender to the Borrower, the principal sum of __________________ AND NO/100 DOLLARS ($________________) (or such lesser amount as shall equal the aggregate unpaid principal amount of Swingline Loans made by the Swingline Lender to the Borrower under the Credit Agreement), on the dates and in the principal amounts provided in the Credit Agreement, and to pay interest on the unpaid principal amount owing hereunder, at the rates and on the dates provided in the Credit Agreement.
The date, amount of each Swingline Loan, and each payment made on account of the principal thereof, shall be recorded by the Swingline Lender on its books and, prior to any transfer of this Note, endorsed by the Swingline Lender on the schedule attached hereto or any continuation thereof,
provided
that the failure of the Swingline Lender to made any such recordation or endorsement shall not affect the obligations of the Borrower to make a payment when due of any amount owing under the Credit Agreement or hereunder in respect of the Swingline Loans.
This Note is the “Swingline Note” referred to in the Eighth Amended and Restated Credit Agreement dated as of November 13, 2012 (as amended, restated, supplemented or otherwise modified from time to time, the “Credit Agreement”), by and among the Borrower, the financial institutions party thereto and their assignees under Section 13.6. thereof, the Administrative Agent, and the other parties thereto, and evidences Swingline Loans made to the Borrower thereunder. Terms used but not otherwise defined in this Note have the respective meanings assigned to them in the Credit Agreement.
The Credit Agreement provides for the acceleration of the maturity of this Note upon the occurrence of certain events and for prepayments of Swingline Loans upon the terms and conditions specified therein.
This Note SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO CONTRACTS EXECUTED, AND TO BE FULLY PERFORMED, IN SUCH STATE.
CBL Holdings I, Inc., Borrower's sole general partner, its successors and assigns (the “General Partner”), shall not be personally liable for the payment of this Note except to the extent set forth in Section 13.21 of the Credit Agreement.
The Borrower hereby waives presentment for payment, demand, notice of demand, notice of non‑payment, protest, notice of protest and all other similar notices.
Time is of the essence for this Note.
IN WITNESS WHEREOF, the undersigned has executed and delivered this Swingline Note under seal as of the date first written above.
CBL & ASSOCIATES LIMITED PARTNERSHIP
By:
CBL Holdings I, Inc.,
as General Partner
By:_____________________________
Name:
Title:
SCHEDULE OF SWINGLINE LOANS
This Note evidences Swingline Loans made under the within-described Credit Agreement to the Borrower, on the dates and in the principal amounts set forth below, subject to the payments and prepayments of principal set forth below:
|
|
|
|
|
|
Date of Loan
|
Principal
Amount of Loan
|
Amount Paid
or Prepaid
|
Unpaid Principal
Amount
|
Notation
Made By
|
EXHIBIT J
TRANSFER AUTHORIZER DESIGNATION
(For Disbursement of Loan Proceeds by Funds Transfer)
£
NEW
S
REPLACE PREVIOUS DESIGNATION
£
ADD
£
CHANGE
£
DELETE LINE NUMBER
_____
The following representatives of CBL & Associates Limited Partnership (“Borrower”) are authorized to request the disbursement of Revolving Loans
and initiate funds transfers for Loan Number
5593ZMA
dated November 13, 2012 between Wells Fargo Bank, National Association (“Administrative Agent”), the lenders party thereto and Borrower. Administrative Agent is authorized to rely on this Transfer Authorizer Designation until it has received a new Transfer Authorizer Designation signed by Borrower, even in the event that any or all of the foregoing information may have changed.
|
|
|
|
|
|
Name
|
Title
|
Maximum Wire
Amount
|
1.
|
Charles B. Lebovitz
|
Chairman of the Board
|
$600,000,000.00
|
2.
|
Stephen D. Lebovitz
|
President and Chief Executive Officer
|
$600,000,000.00
|
3.
|
Farzana K. Mitchell
|
Executive Vice President - Finance and Chief Financial Officer
|
$600,000,000.00
|
4.
|
Charles A. Willett, Jr.
|
Senior Vice President
|
$600,000,000.00
|
5.
|
|
|
|
|
|
Beneficiary Bank and Account Holder Information
|
1.
|
|
|
Transfer Funds to (Receiving Party Account Name):
CBL & Associates Limited Partnership
|
Receiving Party Account Number:
|
Receiving Bank Name, City and State:
First Tennessee Bank, N.A., Memphis, TN
|
Receiving Bank Routing (ABA) Number
084000026
|
Maximum Transfer Amount:
$600,000,000
|
|
Further Credit Information/Instructions:
Attention: Donna Whitehead at (423) 757-4074
|
2.
|
|
|
Transfer Funds to (Receiving Party Account Name):
|
Receiving Party Account Number:
|
Receiving Bank Name, City and State:
|
Receiving Bank Routing (ABA) Number
|
Maximum Transfer Amount:
|
|
Further Credit Information/Instructions:
|
3.
|
|
|
Transfer Funds to (Receiving Party Account Name):
|
Receiving Party Account Number:
|
Receiving Bank Name, City and State:
|
Receiving Bank Routing (ABA) Number
|
Maximum Transfer Amount:
|
|
Further Credit Information/Instructions:
|
Maximum Wire Amount may not exceed the Loan Amount.
Date:
_____________________________
|
|
|
|
“BORROWER”
CBL & ASSOCIATES LIMITED PARTNERSHIP, a
Delaware limited partnership
By:CBL Holdings I, Inc., a Delaware corporation,
its sole general partner
By:
Name:
Title:
(CORPORATE SEAL)
|
EXHIBIT K
FORM OF COMPLIANCE CERTIFICATE
Reference is made to the Eighth Amended and Restated Credit Agreement dated as of November 13, 2012 (as amended, restated, supplemented or otherwise modified from time to time, the "Credit Agreement"), by and among CBL & Associates Limited Partnership (the "Borrower"), CBL & Associates Properties, Inc. (the "Parent"), the financial institutions party thereto and their assignees under Section 13.6 thereof (the "Lenders"), Wells Fargo Bank, National Association, as Administrative Agent (the "Administrative Agent"), and the other parties thereto. Capitalized terms used herein, and not otherwise defined herein, have their respective meanings given to them in the Credit Agreement.
Pursuant to Section 9.3 of the Credit Agreement, the undersigned hereby certifies on behalf of the Borrower to the Administrative Agent and the Lenders that:
1.
(a) The undersigned has reviewed the terms of the Credit Agreement and has made a review of the transactions, financial condition and other affairs of the Borrower and its Subsidiaries as of, and during the relevant accounting period ending on, _______________, 20___, and (b) such review has not disclosed the existence during such accounting period, and the undersigned does not have knowledge of the existence, as of the date hereof, of any condition or event constituting a Default or Event of Default except as set forth on
Schedule 2
hereto, which accurately describes the nature of the condition(s) or event(s) that constitute (a) Default(s) or (an) Event(s) of Default and the actions which the Borrower (is taking) (is planning to take) with respect to such condition(s) or event(s).
2.
Schedule 1
attached hereto accurately and completely sets forth the calculations required to establish compliance with Section 10.1 of the Credit Agreement on the date of the financial statements for the accounting period set forth above.
3.
As of the date hereof, (a) no Default or Event of Default exists other than as set forth on
Schedule 2
attached hereto, and (b) the representations and warranties of the Borrower, the Parent and the other Loan Parties contained in the Credit Agreement and the other Loan Documents are true and correct in all material respects, except to the extent such representations or warranties expressly relate solely to an earlier date (in which case such representations and warranties shall have been true and accurate in all material respects (except in the case of a representation or warranty qualified by materiality, in which case such representation or warranty shall be true and correct in all respects) on and as of such earlier date) and except for changes in factual circumstances specifically and expressly permitted under the Credit Agreement or the other Loan Documents.
IN WITNESS WHEREOF, the undersigned has signed this Compliance Certificate on and as of _______________, 20___.
_________________________________________________________
Name:__________________________________________
Title:___________________________________________
Compliance Certificate
Schedule 1
Compliance Certificate
Schedule 2
Exhibit 10.24.2
EXECUTION COPY
FIRST AMENDMENT TO
EIGHTH AMENDED AND RESTATED CREDIT AGREEMENT
THIS FIRST AMENDMENT TO EIGHTH AMENDED AND RESTATED CREDIT AGREEMENT
(this “Amendment”) is made and entered into as of the 31st day of January, 2013, by and among
CBL & ASSOCIATES LIMITED PARTNERSHIP
, a Delaware limited partnership (hereinafter referred to as “Borrower”),
CBL & ASSOCIATES PROPERTIES, INC.,
a Delaware corporation (hereinafter referred to as the “Parent”), the Lenders party hereto and
WELLS FARGO BANK, NATIONAL ASSOCIATION,
a national banking association, as contractual representative of the Lenders (in such capacity, the “Agent”).
W
I
T
N
E
S
S
E
T
H
:
WHEREAS, Borrower, Parent, Lenders and Agent entered into that certain Eighth Amended and Restated Credit Agreement dated as of November 13, 2012 (the “Credit Agreement”), pursuant to which the Lenders agreed to extend to Borrower a revolving credit facility (the “Credit Facility”) in the aggregate principal amount of up to Six Hundred Million and No/100 Dollars ($600,000,000.00) at any one time outstanding; and
WHEREAS, Borrower, Parent, Requisite Lenders and Agent desire to modify and amend the Credit Agreement in order to modify certain financial covenants set forth in the Credit Agreement, as more particularly set forth herein.
NOW THEREFORE, for and in consideration of the premises, for Ten and No/100 Dollars ($10.00) in hand paid by the parties to each other, and for other good and valuable consideration, the receipt, adequacy and sufficiency of which are hereby acknowledged by Borrower, Parent, Requisite Lenders, and Agent, Borrower, Parent, Requisite Lenders and Agent do hereby covenant and agree as follows:
1.
Definitions
.
Capitalized terms used herein and not otherwise defined shall have the meanings ascribed to such terms in the Credit Agreement.
2.
Guarantors (Section 8.14.)
.
Section 8.14.(a) of the Credit Agreement is amended in its entirety as follows:
“(a)
Within five (5) Business Days (or such longer period as the Administrative Agent may reasonably determine) after the end of the calendar month (or, with respect to clause (iv) below, after May 13, 2013) in which (i) any Person became a Material Subsidiary (other than an Excluded Subsidiary) after the Agreement Date, (ii) any Subsidiary of the Borrower (other than an Excluded Subsidiary) became the owner, directly or indirectly, of the equity interests of any other Guarantor, (iii) solely with respect to any Subsidiary (other than an Excluded Subsidiary) that was a Material Subsidiary as of the Agreement Date and in good faith and without the actual knowledge of the Borrower did not become a Guarantor as of the Agreement Date, such Subsidiary was identified as being a Material Subsidiary, (iv) solely with respect to any Material Subsidiary that was not an Excluded Subsidiary but in good faith and with reasonable belief was identified by the Borrower to
be an Excluded Subsidiary as of the Agreement Date and did not become a Guarantor as of the Agreement Date, (v) any Subsidiary that owns an Eligible Property or other asset, the value of which is included in the determination of Unencumbered Asset Value, incurred, acquired or suffered to exist any Recourse Indebtedness of such Subsidiary, and (vi) any Subsidiary executed and delivered a Guaranty of, or otherwise became obligated in respect of, any Indebtedness of the Parent, the Borrower or any Subsidiary of the Borrower, the Borrower shall deliver to the Administrative Agent each of the following in form and substance satisfactory to the Administrative Agent: (a) an Accession Agreement executed by such Subsidiary and (b) to the extent reasonably requested by the Administrative Agent, the items that would have been delivered under subsections (iv) through (viii) and (xvi) of Section 6.1.(a) if such Person had been a Material Subsidiary on the Agreement Date; provided, that promptly (and in any event within five (5) Business Days) upon any Material Subsidiary which is an Excluded Subsidiary ceasing to be subject to the restriction which prevented it from becoming a Guarantor on the Effective Date or delivering an Accession Agreement pursuant to this Section, as the case may be, such Material Subsidiary shall comply with the provisions of this Section.”
3.
Ratio of Unencumbered NOI to Unsecured Interest Expense (Section 10.1.(g))
.
Section 10.1.(g)
of the Credit Agreement is amended in its entirety as follows:
“(g)
Ratio of Unencumbered NOI to Unsecured Interest Expense
. The Parent shall not permit the ratio of (i) Unencumbered NOI for any fiscal quarter (solely for this clause (i), calculated on an accrual basis for such fiscal quarter with respect to property taxes and insurance) to (ii) Unsecured Interest Expense of the Parent and its Subsidiaries determined on a consolidated basis for such fiscal quarter, to be less than 1.75 to 1.00 as of the last day of such fiscal quarter.”
4.
Conditions Precedent
.
Subject to the other terms and conditions hereof, this Amendment shall not become effective until the Agent shall have received each of the following instruments, documents or agreements, each in form and substance satisfactory to the Agent:
(a)
counterparts of this Amendment duly executed and delivered by Borrower, Parent, Agent and the Requisite Lenders; and
(b)
counterparts of the Consent and Reaffirmation attached as Exhibit A hereto duly executed by the Guarantors, consenting to this Amendment and the transactions contemplated hereby.
Upon fulfillment of the foregoing conditions precedent, this Amendment shall become effective as of the date hereof.
5.
Representations and Warranties; No Default
.
Borrower hereby represents and warrants to the Agent and the Lenders that:
(a)
all of Borrower's representations and warranties contained in the Credit Agreement and the other Loan Documents are true and correct in all material respects on and as of the date of Borrower's execution of this Amendment except to the extent that such representations and warranties expressly relate solely to an earlier date (in which case such representations and warranties shall have been true and accurate on and as of such earlier date) and except for changes in factual circumstances specifically and expressly permitted hereunder;
(b)
no Default or Event of Default has occurred and is continuing as of the date of Borrower's execution of this Amendment under any Loan Document;
(c)
Borrower and Parent have the power and authority to enter into this Amendment and to perform all of its obligations hereunder;
(d)
the execution, delivery and performance of this Amendment by Borrower and Parent have been duly authorized by all necessary corporate, partnership or other action;
(e)
the execution and delivery of this Amendment and performance thereof by Borrower and Parent does not and will not violate the Partnership Agreements or other organizational documents of Borrower or Parent or the Certificate of Incorporation, By-laws or other organizational documents of CBL Holdings I, Inc. and does not and will not violate or conflict with any law, order, writ, injunction, or decree of any court, administrative agency or other governmental authority applicable to Borrower, Parent, CBL Holdings I, Inc., or their respective properties; and
(f)
this Amendment and the Consent and Reaffirmation attached as Exhibit A hereto, constitute legal, valid and binding obligations of the parties thereto, in accordance with the respective terms thereof, subject to bankruptcy, insolvency and similar laws of general application affecting the rights and remedies of creditors and, with respect to the availability of the remedies of specific enforcement, subject to the discretion of the court before which any proceeding therefor may be brought.
6.
Expenses
.
Borrower agrees to pay, promptly following demand by the Agent, all reasonable costs, expenses, fees and other charges and expenses actually incurred by the Agent in connection with the negotiation, preparation, execution and delivery of this Amendment.
7.
Defaults Hereunder
.
The breach of any representation, warranty or covenant contained herein or in any document executed in connection herewith, or the failure to observe or comply with any term or agreement contained herein shall constitute a Default or Event of Default under the Credit Agreement (subject to any applicable cure period set forth in the Credit Agreement) and the Agent and the Lenders shall be entitled to exercise all rights and remedies they may have under the Credit Agreement, any other documents executed in connection therewith and applicable law.
8.
References
.
All references in the Credit Agreement and the Loan Documents to the Credit Agreement shall hereafter be deemed to be references to the Credit Agreement as amended hereby and as the same may hereafter be amended from time to time.
9.
Limitation of Agreement
.
Except as especially set forth herein, this Amendment shall not be deemed to waive, amend or modify any term or condition of the Credit Agreement, each of which is hereby ratified and reaffirmed and which shall remain in full force and effect, nor to serve as a consent to any matter prohibited by the terms and conditions thereof.
10.
Counterparts
.
To facilitate execution, this Amendment may be executed in as many counterparts as may be convenient or required. It shall not be necessary that the signature of, or on behalf of, each party, or that the signature of all persons required to bind any party, appear on each counterpart. All counterparts shall collectively constitute a single document. It shall not be necessary in making proof of this document to produce or account for more than a single counterpart containing the respective signatures of, or on behalf of, each of the parties hereto. Any signature page to any counterpart may be detached from such counterpart without impairing the legal effect of the signature thereon and thereafter attached to another counterpart identical thereto having attached to it additional signature pages.
11.
Further Assurances
.
Borrower agrees to take such further action as the Agent or the Lenders shall reasonably request in connection herewith to evidence the amendments herein contained to the Credit Agreement.
12.
Successors and Assigns
.
This Amendment shall be binding upon and inure to the benefit of the successors and permitted assigns of the parties hereto.
13.
Governing Law
.
This Amendment shall be governed by, and construed in accordance with, the laws of the State of New York.
[Signatures Begin on Following Page]
IN WITNESS WHEREOF
, the parties hereto have caused this First Amendment to Eighth Amended and Restated Credit Agreement to be executed by their authorized officers all as of the day and year first above written.
Borrower:
CBL & Associates Limited Partnership, a Delaware limited partnership
|
|
By:
|
CBL Holdings I, Inc., a Delaware corporation, its sole general partner
|
By:
/s/ Farzana K. Mitchell
____________________
Name:
Farzana K. Mitchell
Title:
Executive Vice President - Chief Financial Officer
PARENT:
CBL & Associates Properties, Inc., a Delaware corporation, solely for the limited purposes set forth in Section 13.22 of the Credit Agreement.
By:
/s/ Farzana K. Mitchell
____________________
Name:
Farzana K. Mitchell
Title:
Executive Vice President - Chief Financial Officer
[Signatures Continued on Following Page]
Signature Page to Amendment to
Eight Amended and Restated Credit Agreement dated as of November 13, 2012
CBL & Associates Limited Partnership et al
[Signature Page to First Amendment to Eighth Amended and Restated Credit Agreement
]
Wells Fargo Bank, National Association, as Agent and as a Lender
By:
/s/ Sam Supple
Name:
Sam Supple
Title:
Senior Vice President
[Signatures Continued on Following Page]
Signature Page to Amendment to
Eight Amended and Restated Credit Agreement dated as of November 13, 2012
CBL & Associates Limited Partnership et al
[Signature Page to First Amendment to Eighth Amended and Restated Credit Agreement
]
U.S. BANK NATIONAL ASSOCIATION
By:
/s/ Michael Raarup
|
|
Title:
|
Senior Vice President
|
[Signatures Continued on Following Page]
Signature Page to Amendment to
Eight Amended and Restated Credit Agreement dated as of November 13, 2012
CBL & Associates Limited Partnership et al
[Signature Page to First Amendment to Eighth Amended and Restated Credit Agreement
]
BANK OF AMERICA, NATIONAL ASSOCIATION
By:
/s/ Christopher Thompson
Name:
Christopher Thompson
Title:
Assistant Vice President
[Signatures Continued on Following Page]
Signature Page to Amendment to
Eight Amended and Restated Credit Agreement dated as of November 13, 2012
CBL & Associates Limited Partnership et al
[Signature Page to First Amendment to Eighth Amended and Restated Credit Agreement
]
KEYBANK NATIONAL ASSOCIATION
By:
/s/ Michael P. Szuba
Title:
Vice President
[Signatures Continued on Following Page]
Signature Page to Amendment to
Eight Amended and Restated Credit Agreement dated as of November 13, 2012
CBL & Associates Limited Partnership et al
[Signature Page to First Amendment to Eighth Amended and Restated Credit Agreement
]
JPMORGAN CHASE BANK, N.A.
By:
/s/ Elizabeth Johnson
Title:
Senior Credit Banker
[Signatures Continued on Following Page]
Signature Page to Amendment to
Eight Amended and Restated Credit Agreement dated as of November 13, 2012
CBL & Associates Limited Partnership et al
[Signature Page to First Amendment to Eighth Amended and Restated Credit Agreement
]
PNC BANK, NATIONAL ASSOCIATION
By:
/s/ Alice Endres
Title:
Assistant Vice President
[Signatures Continued on Following Page]
Signature Page to Amendment to
Eight Amended and Restated Credit Agreement dated as of November 13, 2012
CBL & Associates Limited Partnership et al
[Signature Page to First Amendment to Eighth Amended and Restated Credit Agreement
]
REGIONS BANK
By:
/s/ Lori Chambers
[Signatures Continued on Following Page]
Signature Page to Amendment to
Eight Amended and Restated Credit Agreement dated as of November 13, 2012
CBL & Associates Limited Partnership et al
[Signature Page to First Amendment to Eighth Amended and Restated Credit Agreement
]
ROYAL BANK OF CANADA
By:
/s/ Brian Gross
Name:
Brian Gross
Title:
Authorized Sigantory
[Signatures Continued on Following Page]
Signature Page to Amendment to
Eight Amended and Restated Credit Agreement dated as of November 13, 2012
CBL & Associates Limited Partnership et al
[Signature Page to First Amendment to Eighth Amended and Restated Credit Agreement
]
UNION BANK, N.A.
By:
/s/ Warren H. Li
|
|
Title:
|
V.P Portfolio Management
|
[Signatures Continued on Following Page]
Signature Page to Amendment to
Eight Amended and Restated Credit Agreement dated as of November 13, 2012
CBL & Associates Limited Partnership et al
[Signature Page to First Amendment to Eighth Amended and Restated Credit Agreement
]
BRANCH BANKING AND TRUST COMPANY
By:
/s/ Ahaz A. Armstrong
|
|
Title:
|
Assistant Vice President
|
[Signatures Continued on Following Page]
Signature Page to Amendment to
Eight Amended and Restated Credit Agreement dated as of November 13, 2012
CBL & Associates Limited Partnership et al
[Signature Page to First Amendment to Eighth Amended and Restated Credit Agreement
]
FIFTH THIRD BANK
By:
/s/ John Reynolds
[Signatures Continued on Following Page]
Signature Page to Amendment to
Eight Amended and Restated Credit Agreement dated as of November 13, 2012
CBL & Associates Limited Partnership et al
[Signature Page to First Amendment to Eighth Amended and Restated Credit Agreement
]
RAYMOND JAMES BANK, N.A.
By:
/s/ James M. Armstrong
|
|
Title:
|
Senior Vice President
|
[Signatures Continued on Following Page]
Signature Page to Amendment to
Eight Amended and Restated Credit Agreement dated as of November 13, 2012
CBL & Associates Limited Partnership et al
[Signature Page to First Amendment to Eighth Amended and Restated Credit Agreement
]
MIDFIRST BANK
By:
/s/ Darrin Rigler
[End of Signatures]
Signature Page to Amendment to
Eight Amended and Restated Credit Agreement dated as of November 13, 2012
CBL & Associates Limited Partnership et al
EXHIBIT A
CONSENT AND REAFFIRMATION
Each of the undersigned hereby acknowledges receipt of a copy of the foregoing First Amendment to the Eighth Amended and Restated Credit Agreement dated as of November 13, 2012 (as the same may be amended, restated, supplemented or otherwise modified from time to time, the “
Credit Agreement
”) by and among by and among CBL & ASSOCIATES LIMITED PARTNERSHIP, a Delaware limited partnership (hereinafter referred to as “Borrower”), CBL & ASSOCIATES PROPERTIES, INC., a Delaware corporation (hereinafter referred to as the “Parent”), the Lenders party thereto and WELLS FARGO BANK, NATIONAL ASSOCIATION, a national banking association, as contractual representative of the Lenders (in such capacity, the “Agent”), which First Amendment is dated as of January __, 2013 (the “
Amendment
”). Capitalized terms used in this Consent and Reaffirmation and not defined herein shall have the meanings given to them in the Credit Agreement.
Without in any way establishing a course of dealing by the Administrative Agent or any Lender, each of the undersigned consents to the Amendment and reaffirms the terms and conditions of the Guaranty (or, in the case of the Parent, the Parent Guaranty) and any other Loan Document executed by it and acknowledges and agrees that the Guaranty (or, in the case of the Parent, the Parent Guaranty) and each and every such Loan Document executed by the undersigned in connection with the Credit Agreement remains in full force and effect and is hereby reaffirmed, ratified and confirmed. All references to the Credit Agreement contained in the above‑referenced documents shall be a reference to the Credit Agreement as so modified by the Amendment and as the same may from time to time hereafter be amended, modified or restated.
Dated: January 31, 2013
[
Signature Pages Follow
]
Signature Page to Amendment to
Eight Amended and Restated Credit Agreement dated as of November 13, 2012
CBL & Associates Limited Partnership et al
PARENT:
CBL & Associates Properties, Inc.
By:
/s/ Farzana K. Mitchell
______________________
Farzana K. Mitchell
Executive Vice President - Chief Financial Officer
SUBSIDIARIES:
Acadiana Expansion Parcel, LLC
Acadiana Mall of Delaware, LLC
Alamance Crossing, LLC
Brookfield Square Parcel, LLC
Akron Mall Land, LLC
Columbia Place/Anchor, LLC
CBL/J I, LLC
CBL/J II, LLC
FHM Anchor, LLC
CBL/Huntsville, LLC
CBL/Monroeville I, LLC
CBL/Monroeville II, LLC
CBL/Monroeville III, LLC
Hixson Mall, LLC
Panama City Mall, LLC
CBL/Richland G.P., LLC
Hickory Point-OP Outparcel, LLC
The Shoppes at Panama City, LLC
CBL/Sunrise GP, LLC
CBL/Sunrise Commons GP, LLC
CBL/Sunrise Land, LLC
CBL/Monroeville Expansion I, LLC
CBL/Monroeville Expansion II, LLC
CBL/Monroeville Expansion III, LLC
The Landing at Arbor Place II, LLC
CBL Walden Park, LLC
WNC Shopping Center, LLC
Houston Willowbrook, LLC
CBL El Paso Member, LLC
CBL/Parkdale Mall GP, LLC
CBL/Parkdale, LLC
IV Commons, LLC
Jefferson Mall Company II, LLC
Pearland-OP Parcel 8, LLC
Southpark Mall-DSG, LLC
CBL Gettysburg Member, LLC
CBL-TRS Member I, LLC
CBL/MSC, LLC
CBL/Gulf Coast, LLC
Signature Page to Amendment to
Eight Amended and Restated Credit Agreement dated as of November 13, 2012
CBL & Associates Limited Partnership et al
Laurel Park Retail Properties, LLC
Port Orange Holdings II, LLC
By:
CBL & Associates Limited Partnership,
as the chief manager of each of the above listed
limited liability companies
By:
CBL Holdings I, Inc., its general partner
By:
/s/ Farzana K. Mitchell
______________________
Farzana K. Mitchell
Executive Vice President - Chief Financial Officer
Frontier Mall Associates Limited Partnership
Georgia Square Partnership
Georgia Square Associates, Ltd.
CBL/Nashua Limited Partnership
Lakeshore/Sebring Limited Partnership
Madison Plaza Associates, LTD
Madison Square Associates, Ltd.
College Station Partners, Ltd.
Turtle Creek Limited Partnership
Seacoast Shopping Center Limited Partnership
By:
CBL & Associates Limited Partnership,
as the general partner of each of the above listed
limited partnerships
By:
CBL Holdings I, Inc., its general partner
By:
/s/ Farzana K. Mitchell
______________________
Farzana K. Mitchell
Executive Vice President - Chief Financial Officer
CBL RM-Waco, LLC
By: CBL/Richland G.P., LLC, its managing member
CBL SM-Brownsville, LLC
By: CBL/Sunrise GP, LLC, its managing member
By:
CBL & Associates Limited Partnership,
as the chief manager of the managing member
of each of the above listed limited liability companies
By:
CBL Holdings I, Inc., its general partner
By:
/s/ Farzana K. Mitchell
______________________
Farzana K. Mitchell
Executive Vice President - Chief Financial Officer
Signature Page to Amendment to
Eight Amended and Restated Credit Agreement dated as of November 13, 2012
CBL & Associates Limited Partnership et al
POM-College Station, LLC
By:
CBL & Associates Limited Partnership,
its managing member
By:
CBL Holdings I, Inc., its general partner
By:
/s/ Farzana K. Mitchell
______________________
Farzana K. Mitchell
Executive Vice President - Chief Financial Officer
River Ridge Mall, LLC
By:
Seacoast Shopping Limited Partnership, its chief manager
By:
CBL & Associates Limited Partnership, its general partner
By:
CBL Holdings I, Inc., its general partner
By:
/s/ Farzana K. Mitchell
______________________
Farzana K. Mitchell
Executive Vice President - Chief Financial Officer
CBL/ Monroeville Partner, L.P.
By:
CBL/Monroeville II, LLC, its general partner
CBL/Monroeville, L.P.
By:
CBL/Monroeville I, LLC, its general partner
Monroeville Anchor Limited Partnership
By:
CBL/Monroeville II, LLC, its general partner
CBL/Sunrise XS Land, L.P.
By:
CBL/Sunrise Land, LLC, its general partner
CBL/Sunrise Commons, L.P.
By:
CBL/Sunrise Commons GP, LLC, its general partner
CBL/Monroeville Expansion, L.P.
By:
CBL/Monroeville Expansion I, LLC, its general partner
CBL/Monroeville Expansion Partner, L.P.
By:
CBL/Monroeville Expansion II, LLC, its general partner
Parkdale Mall Associates, L.P.
By:
CBL/Parkdale, LLC, its general partner
By:
CBL & Associates Limited Partnership,
as the chief manager of the general partner of each
of the above listed limited partnerships
By:
CBL Holdings I, Inc., its general partner
By:
/s/ Farzana K. Mitchell
______________________
Farzana K. Mitchell
Executive Vice President - Chief Financial Officer
Signature Page to Amendment to
Eight Amended and Restated Credit Agreement dated as of November 13, 2012
CBL & Associates Limited Partnership et al
CBL/Eastgate I, LLC
By:
CBL/J II, LLC, its chief manager
CBL/Eastgate II, LLC
By:
CBL/J II, LLC, its chief manager
CBL/Old Hickory I, LLC
By:
CBL/J II, LLC, its chief manager
CBL/Old Hickory II, LLC
By:
CBL/J II, LLC, its chief manager
JG Randolph, LLC
By:
CBL/J II, LLC, its chief manager
CBL/Regency I, LLC
By:
CBL/J II, LLC, its chief manager
CBL/Regency II, LLC
By:
CBL/J II, LLC, its chief manager
CBL/Madison I, LLC
By:
CBL/J I, LLC, its chief manager
CBL/Madison II, LLC
By:
CBL/J I, LLC, its chief manager
Parkdale Mall, LLC
By:
CBL/Parkdale Mall GP, LLC, its chief manager
By:
CBL & Associates Limited Partnership,
as the chief manager of the chief manager of each
of the above listed limited liability companies
By:
CBL Holdings I, Inc., its general partner
By:
/s/ Farzana K. Mitchell
______________________
Farzana K. Mitchell
Executive Vice President - Chief Financial Officer
Signature Page to Amendment to
Eight Amended and Restated Credit Agreement dated as of November 13, 2012
CBL & Associates Limited Partnership et al
Eastgate Company
By: CBL/Eastgate I, LLC, its general partner
By: CBL/J II, LLC, its chief manager
By: CBL/Eastgate II, LLC its general partner
By: CBL/J II, LLC, its chief manager
Old Hickory Mall Venture
By: CBL/Old Hickory I, its general partner
By: CBL/J II, LLC, its chief manager
By: CBL/Old Hickory II, its general partner
By: CBL/J II, LLC, its chief manager
Racine Joint Venture
By: CBL/Racine I, LLC, its general partner
By: CBL/J II, LLC, its chief manager
By: CBL/Racine II, LLC its general partner
By: CBL/J II, LLC, its chief manager
Madison Joint Venture
By: CBL/Madison I, LLC, its general partner
By: CBL/J I, LLC, its chief manager
By: CBL/Madison II, LLC its general partner
By: CBL/J I, LLC, its chief manager
By:
CBL & Associates Limited Partnership,
as the chief manager of the chief manager of the
general partners of each of the above
listed general partnerships
By:
CBL Holdings I, Inc., its general partner
By:
/s/ Farzana K. Mitchell
______________________
Farzana K. Mitchell
Executive Vice President - Chief Financial Officer
Signature Page to Amendment to
Eight Amended and Restated Credit Agreement dated as of November 13, 2012
CBL & Associates Limited Partnership et al
Old Hickory Mall Venture II, LLC
By: Old Hickory Mall Venture, its chief manager
By: CBL/Old Hickory I, LLC, its general partner
By: CBL/J II, LLC, its chief manager
By: CBL/Old Hickory II, LLC, its general partner
By: CBL/J II, LLC, its chief manager
Racine Joint Venture II, LLC
By: Racine Joint Venture, its chief manager
By: CBL/Regency I, LLC, its general partner
By: CBL/J II, LLC, its chief manager
By: CBL/Regency II, LLC, its general partner
By: CBL/J II, LLC, its chief manager
By:
CBL & Associates Limited Partnership,
as the chief manager of the chief manager of the
general partners of the chief manager of each of the above
listed limited liability companies
By:
CBL Holdings I, Inc., its general partner
By:
/s/ Farzana K. Mitchell
______________________
Farzana K. Mitchell
Executive Vice President - Chief Financial Officer
JG Randolph II, LLC
By: JG Randolph, LLC, its chief manager
By: CBL/J II, LLC, its chief manager
By: CBL & Associates Limited Partnership,
its chief manager
By:
CBL Holdings I, Inc., its general partner
By:
/s/ Farzana K. Mitchell
______________________
Farzana K. Mitchell
Executive Vice President - Chief Financial Officer
Signature Page to Amendment to
Eight Amended and Restated Credit Agreement dated as of November 13, 2012
CBL & Associates Limited Partnership et al
Bonita Lakes Mall Limited Partnership
By:
CBL/GP III, Inc., its general partner
By:
/s/ Farzana K. Mitchell
______________________
Farzana K. Mitchell
Executive Vice President - Chief Financial Officer
CBL/Low Limited Partnership
Willowbrook Plaza Limited Partnership
By:
CBL/GP, Inc. the general partner of each of the
above listed limited partnerships
By:
/s/ Farzana K. Mitchell
______________________
Farzana K. Mitchell
Executive Vice President - Chief Financial Officer
The Courtyard at Hickory Hollow Limited Partnership
By:
Hickory Hollow Courtyard, Inc., its general partner
By:
/s/ Farzana K. Mitchell
______________________
Farzana K. Mitchell
Executive Vice President - Chief Financial Officer
Harford Mall Business Trust
By:
/s/ Farzana K. Mitchell
______________________
Farzana K. Mitchell
Executive Vice President - Chief Financial Officer
Meridian Mall Limited Partnership
By:
Meridian Mall Company, Inc., its general partner
By:
/s/ Farzana K. Mitchell
______________________
Farzana K. Mitchell
Executive Vice President - Chief Financial Officer
Rivergate Mall Limited Partnership
By:
Rivergate Mall, Inc., its general partner
By:
/s/ Farzana K. Mitchell
______________________
Farzana K. Mitchell
Executive Vice President - Chief Financial Officer
Signature Page to Amendment to
Eight Amended and Restated Credit Agreement dated as of November 13, 2012
CBL & Associates Limited Partnership et al
The Village at Rivergate Limited Partnership
By:
The Village at Rivergate, Inc., its general partner
By:
/s/ Farzana K. Mitchell
______________________
Farzana K. Mitchell
Executive Vice President - Chief Financial Officer
Westgate Crossing Limited Partnership
By:
CBL/GP II, Inc., its general partner
By:
/s/ Farzana K. Mitchell
______________________
Farzana K. Mitchell
Executive Vice President - Chief Financial Officer
Signature Page to Amendment to
Eight Amended and Restated Credit Agreement dated as of November 13, 2012
CBL & Associates Limited Partnership et al
Exhibit 12
CBL & Associates Properties, Inc.
Computation of Ratio of Earnings to Combined Fixed Charges
(in thousands, except ratios)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year Ended December 31,
|
|
2012
|
|
2011
|
|
2010
|
|
2009
|
|
2008
|
Earnings:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income before discontinued operations, equity in earnings and noncontrolling interests
|
$
|
186,315
|
|
|
$
|
154,655
|
|
|
$
|
128,059
|
|
|
$
|
104,394
|
|
|
$
|
76,401
|
|
Fixed charges less capitalized interest and preferred dividends
|
244,432
|
|
|
267,442
|
|
|
285,169
|
|
|
286,242
|
|
|
301,522
|
|
Distributed income of equity investees
|
17,074
|
|
|
9,586
|
|
|
4,959
|
|
|
12,665
|
|
|
15,661
|
|
Equity in losses of equity investees for which charges arise from guarantees
|
—
|
|
|
—
|
|
|
(1,646
|
)
|
|
—
|
|
|
—
|
|
Noncontrolling interest in earnings of subsidiaries that have not incurred fixed charges
|
(3,729
|
)
|
|
(4,158
|
)
|
|
(4,203
|
)
|
|
(4,901
|
)
|
|
(3,886
|
)
|
Total earnings
|
$
|
444,092
|
|
|
$
|
427,525
|
|
|
$
|
412,338
|
|
|
$
|
398,400
|
|
|
$
|
389,698
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Combined fixed charges
(1)
:
|
|
|
|
|
|
|
|
|
|
Interest expense
(2)
|
$
|
244,432
|
|
|
$
|
267,442
|
|
|
$
|
285,169
|
|
|
$
|
286,242
|
|
|
$
|
301,522
|
|
Capitalized interest
|
2,671
|
|
|
4,955
|
|
|
3,577
|
|
|
6,807
|
|
|
19,218
|
|
Preferred dividends
(3)
|
68,197
|
|
|
63,020
|
|
|
53,289
|
|
|
42,555
|
|
|
42,082
|
|
Total combined fixed charges
|
$
|
315,300
|
|
|
$
|
335,417
|
|
|
$
|
342,035
|
|
|
$
|
335,604
|
|
|
$
|
362,822
|
|
|
|
|
|
|
|
|
|
|
|
Ratio of earnings to combined fixed charges
|
1.41
|
|
|
1.27
|
|
|
1.21
|
|
|
1.19
|
|
|
1.07
|
|
|
|
|
|
|
|
|
|
|
(1)
|
The interest portion of rental expense is not calculated because the rental expense of the company is not significant.
|
(2)
|
Interest expense includes amortization of capitalized debt expenses and amortization of premiums and discounts.
|
(3)
|
Includes preferred distributions to the Company's partner in CW Joint Venture, LLC.
|
Exhibit 21
|
|
|
|
Subsidiaries of the Company
|
As of December 31, 2012
|
|
|
|
Subsidiary
|
|
State of Incorporation
or Formation
|
Acadiana Expansion Parcel, LLC
|
|
Louisiana
|
Acadiana Mall CMBS, LLC
|
|
Delaware
|
Acadiana Mall of Delaware, LLC
|
|
Delaware
|
Acadiana Outparcel, LLC
|
|
Delaware
|
Akron Mall Land, LLC
|
|
Delaware
|
Alamance Crossing CMBS, LLC
|
|
Delaware
|
Alamance Crossing II, LLC
|
|
North Carolina
|
Alamance Crossing, LLC
|
|
North Carolina
|
APWM, LLC
|
|
Georgia
|
Arbor Place GP, Inc.
|
|
Georgia
|
Arbor Place II, LLC
|
|
Delaware
|
Arbor Place Limited Partnership
|
|
Georgia
|
Asheville Mall CMBS, LLC
|
|
Delaware
|
Asheville, LLC
|
|
North Carolina
|
Atlanta Outlet Outparcels, LLC
|
|
Delaware
|
Atlanta Outlet Shoppes, LLC
|
|
Delaware
|
Bonita Lakes Mall Limited Partnership
|
|
Mississippi
|
Brookfield Square Joint Venture
|
|
Ohio
|
Brookfield Square Parcel, LLC
|
|
Wisconsin
|
Burnsville Center SPE, LLC
|
|
Delaware
|
C.H. of Akron II, LLC
|
|
Delaware
|
Cary Venture Limited Partnership
|
|
Delaware
|
CBL & Associates Limited Partnership
|
|
Delaware
|
CBL & Associates Management, Inc.
|
|
Delaware
|
CBL Brazil-Brasilia Member, LLC
|
|
Delaware
|
CBL Brazil-Juiz de Fora Member, LLC
|
|
Delaware
|
CBL Brazil-Macae Member, LLC
|
|
Delaware
|
CBL Brazil-Macapa Member, LLC
|
|
Delaware
|
CBL Brazil-Manaus Member, LLC
|
|
Delaware
|
CBL Brazil-Tenco SC Member, LLC
|
|
Delaware
|
CBL El Paso Member, LLC
|
|
Delaware
|
CBL El Paso Outparcel Member, LLC
|
|
Texas
|
CBL El Paso Pref Lender, LLC
|
|
Delaware
|
CBL Gettysburg Member, LLC
|
|
Delaware
|
CBL Grandview Forum, LLC
|
|
Mississippi
|
CBL Holdings I, Inc.
|
|
Delaware
|
CBL Holdings II, Inc.
|
|
Delaware
|
CBL Lee's Summit East, LLC
|
|
Missouri
|
CBL Lee's Summit Peripheral, LLC
|
|
Missouri
|
CBL Morristown, LTD.
|
|
Tennessee
|
CBL Old Hickory Mall, Inc.
|
|
Tennessee
|
CBL RM-Waco, LLC
|
|
Texas
|
|
|
|
|
Subsidiaries of the Company
|
As of December 31, 2012
|
|
|
|
Subsidiary
|
|
State of Incorporation
or Formation
|
CBL SM-Brownsville, LLC
|
|
Texas
|
CBL Statesboro Member, LLC
|
|
Georgia
|
CBL SubREIT, Inc.
|
|
Maryland
|
CBL Terrace Limited Partnership
|
|
Tennessee
|
CBL Triangle Town Member, LLC
|
|
North Carolina
|
CBL Walden Park, LLC
|
|
Texas
|
CBL Woodstock Investments Member, LLC
|
|
Georgia
|
CBL Woodstock Member, LLC
|
|
Georgia
|
CBL Woodstock Outparcel Member, LLC
|
|
Georgia
|
CBL/BFW Kiosks, LLC
|
|
Delaware
|
CBL/Brookfield I, LLC
|
|
Delaware
|
CBL/Brookfield II, LLC
|
|
Delaware
|
CBL/Cary I, LLC
|
|
Delaware
|
CBL/Cary II, LLC
|
|
Delaware
|
CBL/Cherryvale I, LLC
|
|
Delaware
|
CBL/Citadel I, LLC
|
|
Delaware
|
CBL/Citadel II, LLC
|
|
Delaware
|
CBL/Columbia I, LLC
|
|
Delaware
|
CBL/Columbia II, LLC
|
|
Delaware
|
CBL/Columbia Place, LLC
|
|
Delaware
|
CBL/Eastgate I, LLC
|
|
Delaware
|
CBL/Eastgate II, LLC
|
|
Delaware
|
CBL/Eastgate Mall, LLC
|
|
Delaware
|
CBL/Fayette I, LLC
|
|
Delaware
|
CBL/Fayette II, LLC
|
|
Delaware
|
CBL/Foothills Plaza Partnership
|
|
Tennessee
|
CBL/GP Cary, Inc.
|
|
North Carolina
|
CBL/GP I, Inc.
|
|
Tennessee
|
CBL/GP II, Inc.
|
|
Wyoming
|
CBL/GP III, Inc.
|
|
Mississippi
|
CBL/GP V, Inc.
|
|
Tennessee
|
CBL/GP VI, Inc.
|
|
Tennessee
|
CBL/GP, Inc.
|
|
Wyoming
|
CBL/Gulf Coast, LLC
|
|
Florida
|
CBL/High Pointe GP, LLC
|
|
Delaware
|
CBL/High Pointe, LLC
|
|
Delaware
|
CBL/Huntsville, LLC
|
|
Delaware
|
CBL/Imperial Valley GP, LLC
|
|
California
|
CBL/J I, LLC
|
|
Delaware
|
CBL/J II, LLC
|
|
Delaware
|
CBL/Kentucky Oaks, LLC
|
|
Delaware
|
CBL/Kirkwood Mall, LLC
|
|
Delaware
|
CBL/Low Limited Partnership
|
|
Wyoming
|
CBL/Madison I, LLC
|
|
Delaware
|
|
|
|
|
Subsidiaries of the Company
|
As of December 31, 2012
|
|
|
|
Subsidiary
|
|
State of Incorporation
or Formation
|
CBL/Madison II, LLC
|
|
Delaware
|
CBL/Midland I, LLC
|
|
Delaware
|
CBL/Midland II, LLC
|
|
Delaware
|
CBL/Monroeville Expansion I, LLC
|
|
Pennsylvania
|
CBL/Monroeville Expansion II, LLC
|
|
Pennsylvania
|
CBL/Monroeville Expansion III, LLC
|
|
Pennsylvania
|
CBL/Monroeville Expansion Partner, L.P.
|
|
Pennsylvania
|
CBL/Monroeville Expansion, L.P.
|
|
Pennsylvania
|
CBL/Monroeville I, LLC
|
|
Delaware
|
CBL/Monroeville II, LLC
|
|
Pennsylvania
|
CBL/Monroeville III, LLC
|
|
Pennsylvania
|
CBL/Monroeville Partner, L.P.
|
|
Pennsylvania
|
CBL/Monroeville, L.P.
|
|
Pennsylvania
|
CBL/MS General Partnership
|
|
Delaware
|
CBL/MSC II, LLC
|
|
South Carolina
|
CBL/MSC, LLC
|
|
South Carolina
|
CBL/Nashua Limited Partnership
|
|
New Hampshire
|
CBL/Old Hickory I, LLC
|
|
Delaware
|
CBL/Old Hickory II, LLC
|
|
Delaware
|
CBL/Park Plaza GP, LLC
|
|
Arkansas
|
CBL/Park Plaza Mall, LLC
|
|
Delaware
|
CBL/Park Plaza, Limited Partnership
|
|
Arkansas
|
CBL/Parkdale Crossing GP, LLC
|
|
Delaware
|
CBL/Parkdale Crossing, L.P.
|
|
Texas
|
CBL/Parkdale Mall GP, LLC
|
|
Delaware
|
CBL/Parkdale, LLC
|
|
Texas
|
CBL/Regency I, LLC
|
|
Delaware
|
CBL/Regency II, LLC
|
|
Delaware
|
CBL/Richland G.P., LLC
|
|
Texas
|
CBL/Stroud, Inc.
|
|
Pennsylvania
|
CBL/Sunrise Commons GP, LLC
|
|
Delaware
|
CBL/Sunrise Commons, L.P.
|
|
Texas
|
CBL/Sunrise GP, LLC
|
|
Delaware
|
CBL/Sunrise Land, LLC
|
|
Texas
|
CBL/Sunrise XS Land, L.P.
|
|
Texas
|
CBL/T-C, LLC
|
|
Delaware
|
CBL/Towne Mall I, LLC
|
|
Delaware
|
CBL/Towne Mall II, LLC
|
|
Delaware
|
CBL/Wausau I, LLC
|
|
Delaware
|
CBL/Wausau II, LLC
|
|
Delaware
|
CBL/Wausau III, LLC
|
|
Delaware
|
CBL/Wausau IV, LLC
|
|
Delaware
|
CBL/Westmoreland Ground, LLC
|
|
Delaware
|
CBL/Westmoreland I, LLC
|
|
Delaware
|
|
|
|
|
Subsidiaries of the Company
|
As of December 31, 2012
|
|
|
|
Subsidiary
|
|
State of Incorporation
or Formation
|
CBL/Westmoreland II, LLC
|
|
Pennsylvania
|
CBL/Westmoreland, L.P.
|
|
Pennsylvania
|
CBL/York Town Center GP, LLC
|
|
Delaware
|
CBL/York Town Center, LLC
|
|
Delaware
|
CBL/York, Inc.
|
|
Pennsylvania
|
CBL-706 Building, LLC
|
|
North Carolina
|
CBL-708 Land, LLC
|
|
North Carolina
|
CBL-840 GC, LLC
|
|
Virginia
|
CBL-850 GC, LLC
|
|
Virginia
|
CBL-BA Building, LLC
|
|
North Carolina
|
CBL-Brassfield Shopping Center, LLC
|
|
North Carolina
|
CBL-Caldwell Court, LLC
|
|
North Carolina
|
CBL-D'Iberville Member, LLC
|
|
Mississippi
|
CBL-FC Building, LLC
|
|
North Carolina
|
CBL-Friendly Center, LLC
|
|
North Carolina
|
CBL-Garden Square, LLC
|
|
North Carolina
|
CBL-Hunt Village, LLC
|
|
North Carolina
|
CBL-LP Office Building, LLC
|
|
North Carolina
|
CBL-New Garden Crossing, LLC
|
|
North Carolina
|
CBL-Northwest Centre, LLC
|
|
North Carolina
|
CBL-Oak Hollow Square, LLC
|
|
North Carolina
|
CBL-OB Business Center, LLC
|
|
North Carolina
|
CBL-Offices at Friendly, LLC
|
|
North Carolina
|
CBL-One Oyster Point, LLC
|
|
Virginia
|
CBL-PB Center I, LLC
|
|
Virginia
|
CBL-Shops at Friendly II, LLC
|
|
North Carolina
|
CBL-Shops at Friendly, LLC
|
|
North Carolina
|
CBL-ST Building, LLC
|
|
North Carolina
|
CBL-Sunday Drive, LLC
|
|
North Carolina
|
CBL-TRS Joint Venture II, LLC
|
|
Delaware
|
CBL-TRS Joint Venture, LLC
|
|
Delaware
|
CBL-TRS Member I, LLC
|
|
Delaware
|
CBL-TRS Member II, LLC
|
|
Delaware
|
CBL-Two Oyster Point, LLC
|
|
Virginia
|
CBL-Westridge Square, LLC
|
|
North Carolina
|
CBL-Westridge Suites, LLC
|
|
North Carolina
|
Charleston Joint Venture
|
|
Ohio
|
Chattanooga Insurance Company Ltd
|
|
Bermuda
|
Cherryvale Mall, LLC
|
|
Delaware
|
Chesterfield Mall LLC
|
|
Delaware
|
Chicopee Marketplace III, LLC
|
|
Massachusetts
|
CHM/Akron, LLC
|
|
Delaware
|
Citadel Mall CMBS, LLC
|
|
Delaware
|
Citadel Mall DSG, LLC
|
|
South Carolina
|
|
|
|
|
Subsidiaries of the Company
|
As of December 31, 2012
|
|
|
|
Subsidiary
|
|
State of Incorporation
or Formation
|
Coastal Grand, LLC
|
|
Delaware
|
Cobblestone Village at Palm Coast, LLC
|
|
Florida
|
College Station Partners, Ltd.
|
|
Texas
|
Columbia Joint Venture
|
|
Ohio
|
Columbia Place/Anchor, LLC
|
|
South Carolina
|
Coolsprings Crossing Limited Partnership
|
|
Tennessee
|
Coolsprings Mall, LLC
|
|
Tennessee
|
Courtyard at Hickory Hollow Limited Partnership
|
|
Delaware
|
Cross Creek Mall SPE, L.P.
|
|
North Carolina
|
Cross Creek Mall, LLC
|
|
North Carolina
|
Crossings at Marshalls Creek I LLC
|
|
Pennsylvania
|
Crossings at Marshalls Creek II LLC
|
|
Pennsylvania
|
Crossings at Marshalls Creek Limited Partnership
|
|
Pennsylvania
|
CV at North Columbus, LLC
|
|
Georgia
|
CVPC-Lo, LLC
|
|
Florida
|
CVPC-Outparcels, LLC
|
|
Florida
|
CW Joint Venture LLC
|
|
Delaware
|
Dakota Square Mall CMBS, LLC
|
|
Delaware
|
Dallan Acquisitions, LLC
|
|
Delaware
|
Deco Mall, LLC
|
|
Delaware
|
Development Options Centers, LLC
|
|
Delaware
|
Development Options, Inc.
|
|
Wyoming
|
Development Options/Cobblestone, LLC
|
|
Florida
|
DM-Cayman II, Inc.
|
|
Cayman Islands
|
DM-Cayman, Inc.
|
|
Cayman Islands
|
Dunite Acquisitions, LLC
|
|
Delaware
|
Eastgate Company
|
|
Ohio
|
Eastgate Crossing CMBS, LLC
|
|
Delaware
|
Eastgate Mall CMBS, LLC
|
|
Delaware
|
Eastland Holding I, LLC
|
|
Illinois
|
Eastland Holding II, LLC
|
|
Illinois
|
Eastland Mall, LLC
|
|
Delaware
|
Eastland Medical Building, LLC
|
|
Illinois
|
Eastland Member, LLC
|
|
Illinois
|
El Paso Outlet Center Holding, LLC
|
|
Delaware
|
El Paso Outlet Center II, LLC
|
|
Delaware
|
El Paso Outlet Center Manager, Inc.
|
|
Delaware
|
El Paso Outlet Center, LLC
|
|
Delaware
|
El Paso Outlet Outparcels, LLC
|
|
Delaware
|
ERMC II, L.P.
|
|
Tennessee
|
ERMC III Property Management Company, LLC
|
|
Tennessee
|
ERMC IV, LP
|
|
Tennessee
|
ERMC Support Services, LLC
|
|
Tennessee
|
Evin Acquisitions, LLC
|
|
Delaware
|
|
|
|
|
Subsidiaries of the Company
|
As of December 31, 2012
|
|
|
|
Subsidiary
|
|
State of Incorporation
or Formation
|
Fashion Square Mall CMBS, LLC
|
|
Delaware
|
Fayette Development Property, LLC
|
|
Kentucky
|
Fayette Mall SPE, LLC
|
|
Delaware
|
Fayette Plaza CMBS, LLC
|
|
Delaware
|
FHM Anchor, LLC
|
|
Tennessee
|
FHP Expansion GP I, LLC
|
|
Tennessee
|
FHP Expansion GP II, LLC
|
|
Tennessee
|
Foothills Mall Associates, LP
|
|
Tennessee
|
Foothills Mall, Inc.
|
|
Tennessee
|
Frontier Mall Associates Limited Partnership
|
|
Wyoming
|
Galleria Associates, L.P., The
|
|
Tennessee
|
GCTC Peripheral III, LLC
|
|
Florida
|
GCTC Peripheral IV, LLC
|
|
Florida
|
GCTC Peripheral V, LLC
|
|
Florida
|
Georgia Square Associates, Ltd.
|
|
Georgia
|
Georgia Square Partnership
|
|
Georgia
|
Gettysburg Outlet Center GP, Inc.
|
|
Delaware
|
Gettysburg Outlet Center Holding, LLC
|
|
Delaware
|
Gettysburg Outlet Center, LLC
|
|
Delaware
|
Gettysburg Outlet Center, LP
|
|
Pennsylvania
|
Governor's Square Company IB
|
|
Ohio
|
Governor's Square Company
|
|
Ohio
|
Greenbrier Mall II, LLC
|
|
Delaware
|
Greenbrier Mall, LLC
|
|
Delaware
|
Gulf Coast Town Center CMBS, LLC
|
|
Delaware
|
Gulf Coast Town Center Peripheral I, LLC
|
|
Florida
|
Gulf Coast Town Center Peripheral II, LLC
|
|
Florida
|
Gunbarrel Commons, LLC
|
|
Tennessee
|
Hamilton Corner CMBS General Partnership
|
|
Tennessee
|
Hamilton Corner GP I LLC
|
|
Delaware
|
Hamilton Corner GP II LLC
|
|
Delaware
|
Hamilton Crossing CMBS, LLC
|
|
Delaware
|
Hamilton Insurance Company, LLC
|
|
Tennessee
|
Hamilton Place Mall General Partnership
|
|
Tennessee
|
Hamilton Place Mall/GP I, LLC
|
|
Delaware
|
Hamilton Place Mall/GP II, LLC
|
|
Delaware
|
Hammock Landing Collecting Agent, LLC
|
|
Florida
|
Hammock Landing/West Melbourne, LLC
|
|
Florida
|
Hanes Mall DSG, LLC
|
|
North Carolina
|
Harford Mall Business Trust
|
|
Maryland
|
Henderson Square Limited Partnership
|
|
North Carolina
|
Hickory Hollow Courtyard, Inc.
|
|
Delaware
|
Hickory Hollow Mall Limited Partnership
|
|
Delaware
|
Hickory Hollow Mall, Inc.
|
|
Delaware
|
|
|
|
|
Subsidiaries of the Company
|
As of December 31, 2012
|
|
|
|
Subsidiary
|
|
State of Incorporation
or Formation
|
Hickory Hollow/SB, LLC
|
|
Tennessee
|
Hickory Point Outparcels, LLC
|
|
Illinois
|
Hickory Point, LLC
|
|
Delaware
|
Hickory Point-OP Outparcel, LLC
|
|
Illinois
|
High Point Development Limited Partnership
|
|
North Carolina
|
High Point Development Limited Partnership II
|
|
North Carolina
|
High Pointe Commons Holding GP, LLC
|
|
Delaware
|
High Pointe Commons Holding II-HAP GP, LLC
|
|
Pennsylvania
|
High Pointe Commons Holding II-HAP, LP
|
|
Pennsylvania
|
High Pointe Commons Holding, LP
|
|
Pennsylvania
|
High Pointe Commons II-HAP, LP
|
|
Pennsylvania
|
High Pointe Commons, LP
|
|
Pennsylvania
|
Hixson Mall, LLC
|
|
Tennessee
|
Honey Creek Mall Member SPE, LLC
|
|
Delaware
|
Honey Creek Mall, LLC
|
|
Indiana
|
Houston Willowbrook LLC
|
|
Texas
|
Imperial Valley Commons, L.P.
|
|
California
|
Imperial Valley Mall GP, LLC
|
|
Delaware
|
Imperial Valley Mall II, L.P.
|
|
California
|
Imperial Valley Mall, L.P.
|
|
California
|
Imperial Valley Peripheral, L.P.
|
|
California
|
IV Commons, LLC
|
|
California
|
IV Outparcels, LLC
|
|
California
|
Janesville Mall Limited Partnership
|
|
Wisconsin
|
Janesville Wisconsin, Inc.
|
|
Wisconsin
|
Jarnigan Road II, LLC
|
|
Delaware
|
Jarnigan Road Limited Partnership
|
|
Tennessee
|
Jefferson Mall CMBS, LLC
|
|
Delaware
|
Jefferson Mall Company II, LLC
|
|
Delaware
|
JG Gulf Coast Town Center, LLC
|
|
Ohio
|
JG Randolph II, LLC
|
|
Delaware
|
JG Randolph, LLC
|
|
Ohio
|
JG Saginaw II, LLC
|
|
Delaware
|
JG Saginaw, LLC
|
|
Ohio
|
JG Winston-Salem, LLC
|
|
Ohio
|
Kentucky Oaks Mall Company
|
|
Ohio
|
Kirkwood Mall Acquisitions, LLC
|
|
Delaware
|
Kirkwood Mall Mezz, LLC
|
|
Delaware
|
Lakes Mall, LLC, The
|
|
Michigan
|
Lakeshore/Sebring Limited Partnership
|
|
Florida
|
Lakeview Pointe, LLC
|
|
Oklahoma
|
Landing at Arbor Place II, LLC, The
|
|
Delaware
|
Laredo/MDN II Limited Partnership
|
|
Texas
|
Laurel Park Retail Holding LLC
|
|
Michigan
|
|
|
|
|
Subsidiaries of the Company
|
As of December 31, 2012
|
|
|
|
Subsidiary
|
|
State of Incorporation
or Formation
|
Laurel Park Retail Properties LLC
|
|
Delaware
|
Layton Hills Mall CMBS, LLC
|
|
Delaware
|
LeaseCo, Inc.
|
|
New York
|
Lebcon Associates
|
|
Tennessee
|
Lebcon I, Ltd.
|
|
Tennessee
|
Lee Partners
|
|
Tennessee
|
Lexington Joint Venture
|
|
Ohio
|
LHM-Utah, LLC
|
|
Delaware
|
Madison Grandview Forum, LLC
|
|
Mississippi
|
Madison Ground, LLC
|
|
Mississippi
|
Madison Joint Venture
|
|
Ohio
|
Madison Plaza Associates, Ltd.
|
|
Alabama
|
Madison Square Associates, Ltd.
|
|
Alabama
|
Madison/East Towne, LLC
|
|
Delaware
|
Madison/West Towne, LLC
|
|
Delaware
|
Mall Del Norte, LLC
|
|
Texas
|
Mall of South Carolina Limited Partnership
|
|
South Carolina
|
Mall of South Carolina Outparcel Limited Partnership
|
|
South Carolina
|
Mall Shopping Center Company, L.P.
|
|
Texas
|
Maryville Department Store Associates
|
|
Tennessee
|
Maryville Partners, L.P.
|
|
Tennessee
|
MDN/Laredo GP II, LLC
|
|
Delaware
|
MDN/Laredo GP, LLC
|
|
Delaware
|
Meridian Mall Company, Inc.
|
|
Michigan
|
Meridian Mall Limited Partnership
|
|
Michigan
|
Mid Rivers Land LLC
|
|
Delaware
|
Mid Rivers Mall CMBS, LLC
|
|
Delaware
|
Midland Mall LLC
|
|
Delaware
|
Midland Venture Limited Partnership
|
|
Michigan
|
Milford Marketplace, LLC
|
|
Connecticut
|
Monroeville Anchor Limited Partnership
|
|
Pennsylvania
|
Montgomery Partners, L.P.
|
|
Tennessee
|
Mortgage Holdings II, LLC
|
|
Delaware
|
Mortgage Holdings, LLC
|
|
Delaware
|
Newco Mortgage, LLC
|
|
Delaware
|
NewLease Corp.
|
|
Tennessee
|
North Charleston Joint Venture II, LLC
|
|
Delaware
|
Northpark Mall/Joplin, LLC
|
|
Delaware
|
Northwoods Mall CMBS, LLC
|
|
Delaware
|
Oak Park Holding I, LLC
|
|
Kansas
|
Oak Park Mall, LLC
|
|
Delaware
|
OK City JV, LLC
|
|
Delaware
|
OK City Member, LLC
|
|
Delaware
|
OK City Outlets II, LLC
|
|
Delaware
|
|
|
|
|
Subsidiaries of the Company
|
As of December 31, 2012
|
|
|
|
Subsidiary
|
|
State of Incorporation
or Formation
|
OK City Outlets, LLC
|
|
Delaware
|
Old Hickory Mall Venture
|
|
Tennessee
|
Old Hickory Mall Venture II, LLC
|
|
Delaware
|
Panama City Mall, LLC
|
|
Delaware
|
Panama City Peripheral, LLC
|
|
Florida
|
Park Plaza Mall CMBS, LLC
|
|
Delaware
|
Parkdale Crossing CMBS, LLC
|
|
Delaware
|
Parkdale Crossing GP, Inc.
|
|
Texas
|
Parkdale Crossing Limited Partnership
|
|
Texas
|
Parkdale Mall Associates
|
|
Texas
|
Parkdale Mall CMBS, LLC
|
|
Delaware
|
Parkdale Mall, LLC
|
|
Texas
|
Parkway Place Limited Partnership
|
|
Alabama
|
Parkway Place SPE, LLC
|
|
Delaware
|
Parkway Place, Inc.
|
|
Alabama
|
Pavilion at Port Orange, LLC, The
|
|
Florida
|
Pavilion Collecting Agent, LLC, The
|
|
Florida
|
Pearland Ground, LLC
|
|
Texas
|
Pearland Hotel Operator, Inc.
|
|
Texas
|
Pearland Town Center GP, LLC
|
|
Delaware
|
Pearland Town Center Limited Partnership
|
|
Texas
|
Pearland-OP Parcel 8, LLC
|
|
Texas
|
POM-College Station, LLC
|
|
Texas
|
Port Orange Holdings II, LLC
|
|
Florida
|
Port Orange I, LLC
|
|
Florida
|
Port Orange Town Center, LLC
|
|
Delaware
|
PPG Venture I, LP
|
|
Delaware
|
Promenade D'Iberville, LLC, The
|
|
Mississippi
|
Property Taxperts, LLC
|
|
Nevada
|
Racine Joint Venture
|
|
Ohio
|
Racine Joint Venture II, LLC
|
|
Delaware
|
Renaissance Fayetteville Road III, LLC
|
|
North Carolina
|
Renaissance Member II, LLC
|
|
Delaware
|
Renaissance Retail LLC
|
|
North Carolina
|
Renaissance SPE Member, LLC
|
|
Delaware
|
River Ridge Mall, LLC
|
|
Virginia
|
Rivergate Mall Limited Partnership
|
|
Delaware
|
Rivergate Mall, Inc.
|
|
Delaware
|
Seacoast Shopping Center Limited Partnership
|
|
New Hampshire
|
Shoppes at Hamilton Place, LLC, The
|
|
Tennessee
|
Shoppes at Panama City, LLC
|
|
Florida
|
Shoppes at St. Clair CMBS, LLC
|
|
Delaware
|
Shoppes at St. Clair Square, LLC
|
|
Illinois
|
Shopping Center Finance Corp.
|
|
Wyoming
|
|
|
|
|
Subsidiaries of the Company
|
As of December 31, 2012
|
|
|
|
Subsidiary
|
|
State of Incorporation
or Formation
|
Shops at Pineda Ridge, LLC, The
|
|
Florida
|
South County Shoppingtown LLC
|
|
Delaware
|
Southaven Towne Center II, LLC
|
|
Delaware
|
Southaven Towne Center, LLC
|
|
Mississippi
|
Southpark Mall CMBS, LLC
|
|
Delaware
|
Southpark Mall, LLC
|
|
Virginia
|
Southpark Mall-DSG, LLC
|
|
Virginia
|
Springdale/Mobile GP II, Inc.
|
|
Alabama
|
Springdale/Mobile GP, Inc.
|
|
Alabama
|
Springhill/Coastal Landing, LLC
|
|
Florida
|
St. Clair Square GP I, LLC
|
|
Illinois
|
St. Clair Square GP, Inc.
|
|
Illinois
|
St. Clair Square Limited Partnership
|
|
Illinois
|
St. Clair Square SPE, LLC
|
|
Delaware
|
Statesboro Crossing, LLC
|
|
Georgia
|
Stroud Mall LLC
|
|
Pennsylvania
|
SubREIT Investor-Boston General Partnership
|
|
Massachusetts
|
SubREIT Investor-Boston GP I, LLC
|
|
Massachusetts
|
Sutton Plaza GP, Inc.
|
|
New Jersey
|
Towne Mall Company
|
|
Ohio
|
Triangle Town Center, LLC
|
|
Delaware
|
Triangle Town Member, LLC
|
|
North Carolina
|
Turtle Creek Limited Partnership
|
|
Mississippi
|
Valley View Mall SPE, LLC
|
|
Delaware
|
Village at Newnan Crossing, LLC, The
|
|
Georgia
|
Village at Orchard Hills, LLC
|
|
Michigan
|
Village at Rivergate Limited Partnership
|
|
Delaware
|
Village at Rivergate, Inc.
|
|
Delaware
|
Volusia Mall GP, Inc.
|
|
New York
|
Volusia Mall Limited Partnership
|
|
New York
|
Volusia Mall Member SPE, LLC
|
|
Delaware
|
Volusia Mall, LLC
|
|
Florida
|
Volusia-OP Peripheral LLC
|
|
Florida
|
Walnut Square Associates Limited Partnership
|
|
Wyoming
|
Waterford Commons of CT III, LLC
|
|
Connecticut
|
Wausau Center CMBS, LLC
|
|
Delaware
|
Wausau Joint Venture
|
|
Ohio
|
Wausau Penney CMBS, LLC
|
|
Delaware
|
Wausau Penney Investor Joint Venture
|
|
Ohio
|
West County Mall CMBS, LLC
|
|
Delaware
|
West County Shoppingtown LLC
|
|
Delaware
|
West Melbourne Holdings II, LLC
|
|
Florida
|
West Melbourne I, LLC
|
|
Delaware
|
West Melbourne Town Center LLC
|
|
Delaware
|
|
|
|
|
Subsidiaries of the Company
|
As of December 31, 2012
|
|
|
|
Subsidiary
|
|
State of Incorporation
or Formation
|
West Towne District, LLC
|
|
Wisconsin
|
Westgate Crossing Limited Partnership
|
|
South Carolina
|
Westgate Mall CMBS, LLC
|
|
Delaware
|
Westgate Mall II, LLC
|
|
Delaware
|
Westgate Mall Limited Partnership
|
|
South Carolina
|
Whitehall Station, LLC
|
|
Missouri
|
Wilkes-Barre Marketplace GP, LLC
|
|
Pennsylvania
|
Wilkes-Barre Marketplace I, LLC
|
|
Pennsylvania
|
Wilkes-Barre Marketplace, L.P.
|
|
Pennsylvania
|
Willowbrook Plaza Limited Partnership
|
|
Maine
|
WMTC-Peripheral, LLC
|
|
Florida
|
WNC Shopping Center, LLC
|
|
North Carolina
|
Woodstock GA Investments LLC
|
|
Delaware
|
WPMP Holding LLC
|
|
Delaware
|
York Galleria Limited Partnership
|
|
Virginia
|
York Town Center Holding GP, LLC
|
|
Delaware
|
York Town Center Holding, LP
|
|
Pennsylvania
|
York Town Center, LP
|
|
Pennsylvania
|
Exhibit 23
CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
We consent to the incorporation by reference in Registration Statement Nos. 33-73376, 333-04295, 333-41768, 333-88914 and 333-182217 on Form S-8 and Registration Statement Nos.
333-90395, 333-62830, 333-108947 and 333-182515 on Form S-3 of our report dated March 1, 2013, relating to the fin
ancial statements and financial statement schedules of CBL & Associates Properties, Inc., and the effectiveness of CBL & Associates Properties, Inc.'s internal control over financial reporting, appearing in this Annual Report on Form 10-K of CBL & Associates Properties, Inc., for the year ended December 31, 2012.
/s/ Deloitte & Touche LLP
Atlanta, Georgia
March 1, 2013
Exhibit 24
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints
Charles B. Lebovitz, Farzana K. Mitchell and Stephen D. Lebovitz and each of them, with full power to act without the other, his/her true and lawful attorney-in-fact and agent, with full
power of substitution and resubstitution, for him/her and in his/her name, place and stead, in any and all capacities, to sign the Annual Report of CBL & Associates Properties, Inc. on Form 10-K for the fiscal year ended December 31, 2012 including one or more amendments to such Form 10-K, which amendments may make such changes as such attorneys-in-fact and agents deems appropriate, and to file the same, with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and thing requisite and necessary fully to all intents and purposes as he/she might or could do in person thereby ratifying and confirming all that said attorneys-in-fact and agents or any of them, or their or his substitutes or substitute, may lawfully do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has executed this Power-of-Attorney on the date set opposite his/her respective name.
|
|
|
|
|
|
Signature
|
|
Title
|
|
Date
|
|
|
|
|
|
/s/ Charles B. Lebovitz _____
Charles B. Lebovitz
|
Chairman of the Board
|
February 5, 2013
|
|
|
|
/s/ Farzana K.Mitchell______
Farzana K. Mitchell
|
Executive Vice President - Chief Financial Officer and Treasurer (Principal Financial Officer and Principal Accounting Officer)
|
February 5, 2013
|
|
|
|
|
/s/ Stephen D. Lebovitz_____
Stephen D. Lebovitz
|
Director, President and Chief Executive Officer (Principal Executive Officer)
|
|
February 5, 2013
|
|
|
|
|
|
/s/ Gary L. Bryenton________
Gary L. Bryenton
|
Director
|
|
February 5, 2013
|
|
|
|
|
|
/s/ Thomas J. DeRosa_______
Thomas J. DeRosa
|
Director
|
|
February 5, 2013
|
|
|
|
|
/s/ Matthew S. Dominski_____
Matthew S. Dominski
|
Director
|
|
February 5, 2013
|
|
|
|
|
/s/ Kathleen M. Nelson_____
Kathleen M. Nelson
|
Director
|
|
February 5, 2013
|
|
|
|
|
|
/s/ Gary J. Nay_____________
Gary J. Nay
|
Director
|
|
February 5, 2013
|
|
|
|
|
|
/s/ Winston W. Walker_______
Winston W. Walker
|
Director
|
|
February 5, 2013
|
Exhibit 31.1
CERTIFICATION
I, Stephen D. Lebovitz, certify that:
|
|
(1)
|
I have reviewed this annual report on Form 10-K of CBL & Associates Properties, Inc.;
|
|
|
(2)
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
|
|
(3)
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
|
|
(4)
|
The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
|
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
|
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
|
|
(c)
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
|
|
(d)
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
|
|
(5)
|
The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
|
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
|
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
Date: March 1, 2013
/s/ Stephen D. Lebovitz
____________________________________
Stephen D. Lebovitz, Director, President and
Chief Executive Officer
Exhibit 31.2
CERTIFICATION
I, Farzana K. Mitchell, certify that:
|
|
(1)
|
I have reviewed this annual report on Form 10-K of CBL & Associates Properties, Inc.;
|
|
|
(2)
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
|
|
(3)
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
|
|
(4)
|
The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
|
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
|
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
|
|
(c)
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
|
|
(d)
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
|
|
(5)
|
The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
|
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
|
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
Date: March 1, 2013
/s/ Farzana K. Mitchell
_______________________________________
Farzana K. Mitchell, Executive Vice President -
Chief Financial Officer and Treasurer
Exhibit 32.1
CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Annual Report of CBL & ASSOCIATES PROPERTIES, INC. (the “Company”) on Form 10-K for the year ending December 31, 2012 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Stephen D. Lebovitz, Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. § 1350 (as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002), that:
(1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
/s/ Stephen D. Lebovitz
____________________________________
Stephen D. Lebovitz, Director, President and
Chief Executive Officer
March 1, 2013
____________________________________
Date
Exhibit 32.2
CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Annual Report of CBL & ASSOCIATES PROPERTIES, INC. (the “Company”) on Form 10-K for the year ending December 31, 2012 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Farzana K. Mitchell, Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. § 1350 (as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002), that:
(1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
/s/ Farzana K. Mitchell
_______________________________________
Farzana K. Mitchell, Executive Vice President -
Chief Financial Officer and Treasurer
March 1, 2013
____________________________________
Date