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Master Reimbursement Agreement

 

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Title:

Master Reimbursement Agreement

Entities:

Fairways-Columbia, LP; McGraw-Hill Companies Inc.; Mid-America Apartment Communities Inc.; Mid-America Apartments, LP; Prudential Multifamily Mortgage, Inc.; Federal National Mortgage Association

Date:

2004

Size:

Preview shows 146KB of 368KB total

Price:

$89

ID:

#260888

 

 

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MASTER REIMBURSEMENT AGREEMENT

 

by and among

 

FANNIE MAE

 

and

 

MID-AMERICA APARTMENTS, L.P.,

a Tennessee limited partnership,

 

and

 

FAIRWAYS-COLUMBIA, L.P.,

a Tennessee limited partnership,

 

dated as of

 

June 1, 2001

 

TABLE OF CONTENTS

 

RECITALS

            1
ARTICLE I  

DEFINITIONS

    2

1.1

  

General Interpretive Principles

    2

1.2

  

Defined Terms

    2

1.3

  

Interpretation

    29
ARTICLE II  

REPRESENTATIONS, WARRANTIES AND COVENANTS

    29

2.1

  

Representations and Warranties of The Borrower

    29
    2.1(1)   Due Organization and Qualification    30
    2.1(2)   Power and Authority    30
    2.1(3)   Due Authorization    30
    2.1(4)   Valid and Binding Obligations    30
    2.1(5)   Noncontravention; No Liens    31
    2.1(6)   Pending Litigation or Other Proceedings    31
    2.1(7)   Solvency    31
    2.1(8)   No Contractual Defaults    32
    2.1(9)   Compliance with the Borrower Documents    32
    2.1(10)   ERISA    32
    2.1(11)   Financial Information    32
    2.1(12)   Accuracy and Completeness of Information    32
    2.1(13)   No Conflicts of Interest    33
    2.1(14)   Governmental Approvals    33
    2.1(15)   Governmental Orders    33
    2.1(16)   No Reliance    33
    2.1(17)   Compliance with Applicable Laws    33
    2.1(18)   Affiliate Contracts    34
    2.1(19)   Lines of Business    34
    2.1(20)   Status as a Real Estate Investment Trust    34
    2.1(21)   Title    34
    2.1(22)   Impositions    34
    2.1(23)   Zoning    35
    2.1(24)   Enforceability of Leases    35
    2.1(25)   Rent Roll    35
    2.1(26)   Status of Landlord under Leases    35
    2.1(27)   Enforceability of Leases    36
    2.1(28)   No Lease Options    36
    2.1(29)   Insurance    36
    2.1(30)   Tax Parcels    36
    2.1(31)   Encroachments    36
    2.1(32)   Independent Unit    36
    2.1(33)   Condition of Mortgaged Property    37
    2.1(34)   No Defaults Relating to Prior Bonds    37

 

i

Master Reimbursement Agreement

Mid-America

   

2.1(35)

   Compliance with Tax Certificate   37
   

2.1(36)

   Official Statement   37
   

2.1(37)

   Single Purpose Entity   38
   

2.1(38)

   Commercial Leases   38
   

2.1(39)

   Absence of Default in Payment of Indebtedness   38

2.2

  

Affirmative Covenants of the Borrower

   38
   

2.2(1)

   Compliance with the Borrower Documents   38
   

2.2(2)

   Maintenance of Existence   38
   

2.2(3)

   Maintenance of REIT Status; Ownership Structure   38
   

2.2(4)

   Financial Statements; Accountants Reports; Other Information   38
   

2.2(5)

   Certificate of Compliance   41
   

2.2(6)

   Maintain Licenses   42
   

2.2(7)

   Access to Records; Discussions With Officers and Accountants   42
   

2.2(8)

   Inform Loan Servicer of Material Events   42
   

2.2(9)

   Inspection   44
   

2.2(10)

   Compliance with Applicable Laws   44
   

2.2(11)

   Warranty of Title   44
   

2.2(12)

   Defense of Actions   44
   

2.2(13)

   Alterations to the Mortgaged Properties   45
   

2.2(14)

   ERISA   46
   

2.2(15)

   Document Taxes   46
   

2.2(16)

   Further Assurances   46
   

2.2(17)

   Monitoring Compliance   46
   

2.2(18)

   Leases   46
   

2.2(19)

   Change in Senior Management   47
   

2.2(20)

   Geographic Diversification   47
   

2.2(21)

   Ownership of Mortgaged Properties   47
   

2.2(22)

   Single-Purpose Entity   47
   

2.2(23)

   Affiliate Contracts   48
   

2.2(24)

   Post-Closing Opinions   48

2.3

  

Bond Related Covenants

   48
   

2.3(1)

   Assignment of Rights to Fannie Mae and the Trustee   48
   

2.3(2)

   Prepayment   48
   

2.3(3)

   Monitoring Compliance   48
   

2.3(4)

   Removal of Remarketing Agent   49
   

2.3(5)

   Changes in Remarketing Agent   49
   

2.3(6)

   Continuing Disclosure   49
   

2.3(7)

   Preliminary Official Statement; Official Statement   49

2.4

  

Negative Covenants of the Borrower

   49
   

2.4(1)

   Other Activities   49
   

2.4(2)

   Value of Security   50
   

2.4(3)

   Zoning   50
   

2.4(4)

   Liens   50
   

2.4(5)

   Sale   50
   

2.4(6)

   Indebtedness   50
   

2.4(7)

   Principal Place of Business   50

 

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Master Reimbursement Agreement

Mid-America

    2.4(8)   Change in Property Management    50
    2.4(9)   Condominiums    51
    2.4(10)   Restrictions on Partnership Distributions    51
    2.4(11)   Lines of Business    51
    2.4(12)   Limitation on Unimproved Real Property and New Construction    51
    2.4(13)   Dividend Payout    51
    2.4(14)   No Amendments to Borrower Documents    51
    2.4(15)   Use of Proceeds    52

2.5

  

Replacement or Termination of Fannie Mae Enhancement.

    52

2.6

  

Financial Covenants

    52
    2.6(1)   Financial Definitions    53
    2.6(2)   Compliance with Debt Service Coverage Ratios    56
    2.6(3)   Compliance with Loan to Value Ratios    56
    2.6(4)   Compliance with Concentration Test    56
    2.6(5)   Compliance with Key Principals Net Worth Test    57
    2.6(6)   Compliance with Key Principals Total Indebtedness to Consolidated Total Assets Ratio    57
    2.6(7)   Compliance with Key Principals Consolidated EBITDA to Interest Ratio    57
    2.6(8)   Compliance with Key Principals Consolidated EBITDA to Fixed Charge Ratio    57

2.7

  

Transfer of Ownership Interests of Each Borrower

    57
    2.7(1)   Prohibition on Transfers    57
    2.7(2)   Permitted Transfers    57
    2.7(3)   Consent to Prohibited Transfers    59
ARTICLE III  

FANNIE MAE CREDIT ENHANCEMENT INSTRUMENT; REIMBURSEMENT; FEES AND OTHER PAYMENTS; INDEMNIFICATION

    60

3.1

  

Agreement to Execute and Deliver Each Credit Enhancement Instrument; Conditions Precedent to Execution and Delivery of Each Credit Enhancement Instrument

    60
    3.1(1)   Agreement to Execute and Deliver Each Credit Enhancement Instrument    60
    3.1(2)   Conditions Precedent to Execution and Delivery of Each Credit Enhancement Instrument    61

3.2

  

Reimbursement Obligations

    64
    3.2(1)   Reimbursement Obligations    64

3.3

  

Fees, Costs and Expenses

    66
    3.3(1)   Facility Fee    66
    3.3(2)   Activity Fee    67
    3.3(3)   Transfer Fee    68
    3.3(4)   Termination Fee    68
    3.3(5)   Payments of Costs, Fees and Expenses    69
    3.3(6)   Fannie Mae Advances    70
    3.3(7)   Origination Fees    71
    3.3(8)   Due Diligence Fees    71

 

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Master Reimbursement Agreement

Mid-America

3.4

   Principal Reserve Fund    71
    3.4(1)   Principal Reserve Fund Payments    71
    3.4(2)   Use of Principal Reserve Fund    71
    3.4(3)   Reduction in Principal Reserve Fund Payments    72
    3.4(4)   Replenish Losses    72
    3.4(5)   Trigger Events with Respect to Use of Principal Reserve Fund    72

3.5

   Payments    72
    3.5(1)   Payments to Loan Servicer    72
    3.5(2)   Late Charge    73
    3.5(3)   Payments on Business Days    73
    3.5(4)   Application of Payments    73
    3.5(5)   Interest on Amounts Not Paid When Due    73
    3.5(6)   Risk of Loss    73

3.6

   Indemnification    74
    3.6(1)   Indemnification    74
    3.6(2)   Additional Indemnification    75
    3.6(3)   Survival    76

3.7

   Liability of The Borrower    76

3.8

   Fannie Mae and Loan Servicer Not Liable    77

3.9

   Waivers and Consents    78

3.10

   Subrogation    78

3.11

   Pledge of Rights to Certain Funds and Investments    78

3.12

   Pledged Bonds    79

3.13

   Recourse Obligations, Termination of Personal Liability, and Exceptions to Limits on Personal
Liability		    79
    3.13(1)   Full Recourse    79
    3.13(2)   Termination of Personal Liability    79
    3.13(3)   Exceptions to Limits on Personal Liability    80
    3.13(4)   Full Recourse After Termination of Personal Liability    80
    3.13(5)   Permitted Transfer Not Release    80
    3.13(6)   Miscellaneous    80

3.14

   Loan Servicing    81
    3.14(1)   Loan Servicing    81
    3.14(2)   Payments Directly to Loan Servicer    81
    3.14(3)   Payments on Servicing Payment Dates    81
    3.14(4)   Mortgage Interest During Weekly Variable Rate    81

3.15

   Borrowing Agency Provisions    82
ARTICLE IV   JOINT AND SEVERAL OBLIGATIONS; CROSS GUARANTY AND OTHER
INTERBORROWER MATTERS		    82

4.1

   Joint and Several Obligation; Cross-Guaranty    82

4.2

   Waivers by Borrower and Other Rights    83

4.3

   No Impairment    84

4.4

   No Subrogation    84

4.5

   Subordination of Subrogation, Etc.    84

4.6

   Election of Remedies    85

4.7

   Subordination of Other Obligations    85

 

iv

Master Reimbursement Agreement

Mid-America Apartments

4.8

  

Insolvency and Liability of Other Borrower

    86

4.9

  

Preferences, Fraudulent Conveyances, Etc.

    87

4.10

  

Maximum Liability of Each Borrower

    87

4.11

  

Liability Cumulative

    88
ARTICLE V  

ADDITIONS OF COLLATERAL

    88

5.1

  

Request to Add Collateral

    88

5.2

  

Procedure for Adding Collateral

    88

5.3

  

Conditions Precedent to Addition of an Additional Mortgaged Property to the Collateral Pool

    89

5.4

  

Additional Mortgaged Property Confirmation

    90

ARTICLE VI

  

RELEASES OF COLLATERAL; SUBSTITUTIONS OF COLLATERAL; ADDITIONAL COLLATERAL

    91

6.1

  

Right to Obtain Releases of Collateral

    91

6.2

  

Procedure for Obtaining Releases of Collateral

    91

6.3

  

Conditions Precedent to Release of Collateral Release Property from the Collateral

    92

6.4

  

Substitutions

    94

6.5

  

Additional Collateral to Satisfy Requirements

    99
   

6.5(1)

    Additional Collateral    99
   

6.5(2)

    Letter of Credit    100