Exhibit 10.1

CONSTRUCTION LOAN AGREEMENT

for a loan in the amount of

$148,864,335

MADE BY AND BETWEEN

TARANTULA VENTURES LLC,

a Delaware limited liability company,

As Borrower

AND

KEYBANK NATIONAL ASSOCIATION,

a national banking association,

127 Public Square,

Cleveland, Ohio 44114

as a Lender and as Administrative Agent

AND

KEYBANC CAPITAL MARKETS

as sole lead arranger and book manager

Dated as of December 20, 2007

 

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TABLE OF CONTENTS

 

						Page
ARTICLE 1				INCORPORATION OF RECITALS AND EXHIBITS		1
1.1				Incorporation of Recitals		1
1.2				Incorporation of Exhibits		1
ARTICLE 2				DEFINITIONS		2
2.1				Defined Terms		2
2.2				Other Definitional Provisions		16
ARTICLE 3				BORROWER’S REPRESENTATIONS AND WARRANTIES		16
3.1				Representations and Warranties		16
3.2				Survival of Representations and Warranties		22
ARTICLE 4				LOAN AND LOAN DOCUMENTS		22
4.1				Agreement to Borrow and Lend; Lender’s Obligation to Disburse		22
4.2				Loan Documents		23
4.3				Term of the Loan		24
4.4				Prepayments		24
4.5				Required Principal Payments		25
4.6				Late Charge		25
4.7				Funds for Payment		25
ARTICLE 5				INTEREST		26
5.1				Interest Rate		26
5.2				[Intentionally Omitted.]		28
ARTICLE 6				COSTS OF MAINTAINING LOAN		28
6.1				Increased Costs and Capital Adequacy		28
6.2				Borrower Withholding		29
ARTICLE 7				LOAN EXPENSE AND ADVANCES		30
7.1				Loan and Administration Expenses		30
7.2				Fees		30
7.3				[Intentionally Omitted.]		30
7.4				Agent’s Attorneys’ Fees and Disbursements		30
7.5				Time of Payment of Fees and Expenses		31
7.6				Expenses and Advances Secured by Loan Documents		31
7.7				Right of Lender to Make Advances to Cure Borrower’s Defaults		31

 

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TABLE OF CONTENTS

(continued)

 

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ARTICLE 8				NON-CONSTRUCTION REQUIREMENTS PRECEDENT TO THE OPENING OF THE LOAN		31
8.1				Non-Construction Conditions Precedent		31
ARTICLE 9				CONSTRUCTION REQUIREMENTS PRECEDENT TO THE OPENING OF THE LOAN		34
9.1				Required Construction Documents		34
ARTICLE 10				BUDGET AND CONTINGENCY FUND		35
10.1				Budget		35
10.2				Budget Line Items		36
10.3				Contingency Fund		36
10.4				Optional Method for Payment of Interest		36
ARTICLE 11				SUFFICIENCY OF LOAN		37
11.1				Loan In Balance		37
ARTICLE 12				CONSTRUCTION PAYOUT REQUIREMENTS		37
12.1				Applicability of Sections		37
12.2				Monthly Payouts		37
12.3				Documents to be Furnished for Each Disbursement		38
12.4				Retainages.		39
12.5				Disbursements for Materials Stored On-Site		39
12.6				Disbursements for Offsite Materials		40
12.7				Intentionally Omitted		40
ARTICLE 13				FINAL DISBURSEMENT FOR CONSTRUCTION		40
13.1				Final Disbursement for Construction		40
ARTICLE 14				RESERVED		41
ARTICLE 15				OTHER COVENANTS		41
15.1				Borrower further covenants and agrees as follows:		41
15.2				Authorized Representative		51
ARTICLE 16				CASUALTIES AND CONDEMNATION		52
16.1				Agent’s Election to Apply Proceeds on Indebtedness		52
16.2				Borrower’s Obligation to Rebuild and Use of Proceeds Therefor		53
ARTICLE 17				ASSIGNMENTS BY LENDER AND BORROWER		53
17.1				Prohibition of Assignments and Transfers by Borrower		53

 

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TABLE OF CONTENTS

(continued)

 

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17.2				Prohibition of Transfers in Violation of ERISA		53
17.3				Successors and Assigns		54
ARTICLE 18				TIME OF THE ESSENCE		54
18.1				Time is of the Essence		54
ARTICLE 19				EVENTS OF DEFAULT		54
ARTICLE 20				LENDER’S REMEDIES IN EVENT OF DEFAULT		57
20.1				Remedies Conferred Upon Lender		57
ARTICLE 21				GENERAL PROVISIONS		58
21.1				Captions		58
21.2				Modification; Waiver		58
21.3				Governing Law		58
21.4				Acquiescence Not to Constitute Waiver of Lender’s Requirements		58
21.5				Disclaimer by Lender		58
21.6				Partial Invalidity; Severability		59
21.7				Definitions Include Amendments		59
21.8				Execution in Counterparts		60
21.9				Entire Agreement		60
21.10				Waiver of Damages		60
21.11				Claims Against Lender		60
21.12				Jurisdiction		60
21.13				Set-Offs		61
ARTICLE 22				NOTICES		61
ARTICLE 23				WAIVER OF JURY TRIAL		62
ARTICLE 24				ASSIGNMENTS AND PARTICIPATIONS		63
24.1				Assignments and Participations		63
24.2				Several Liability		66
ARTICLE 25				AGENT		66
25.1				Appointment		66
25.2				Reliance on Agent		67
25.3				Powers		67
25.4				Disbursements		67

 

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TABLE OF CONTENTS

(continued)

 

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25.5				Distribution and Apportionment of Payments		68
25.6				Consents and Approvals		70
25.7				Agency Provisions Relating to Collateral		72
25.8				Lender Actions Against Borrower or the Collateral		73
25.9				Assignment and Participation		73
25.10				Ratable Sharing		74
25.11				General Immunity		74
25.12				No Responsibility for Loan, Recitals, etc		74
25.13				Action on Instructions of Lenders		75
25.14				Employment of Agents and Counsel		75
25.15				Reliance on Documents; Counsel		76
25.16				Agent’ Reimbursement and Indemnification		76
25.17				Rights as a Lender		76
25.18				Lenders’ Credit Decisions		77
25.19				Notice of Events of Default		77
25.20				Successor Agent		77

 

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LIST OF EXHIBITS TO LOAN AGREEMENT

 

Exhibit A		Legal Description of Land
Exhibit B		Permitted Exceptions
Exhibit C		Form of Note
Exhibit D		Intentionally Omitted
Exhibit E		LIBOR Notice Election
Exhibit F		Insurance Requirements
Exhibit G		Architect’s Certificate
Exhibit H		Initial Budget
Exhibit I		Borrower’s Certificate
Exhibit J		Soft and Hard Cost Requisition Form
Exhibit K		Engineer’s Certificate
Exhibit L		Assignment and Assumption Agreement
Exhibit M		Patriot Act and OFAC Transferee and Assignee Identifying Information Form

 

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CONSTRUCTION LOAN AGREEMENT

Project Commonly Known as

“Data Center Facility, CH1, Elk Grove Village, Illinois”

THIS CONSTRUCTION LOAN AGREEMENT (“ Agreement ”) is made as of December 20, 2007, by and among TARANTULA VENTURES LLC, a Delaware limited liability company (“ Borrower ”), and KEYBANK NATIONAL ASSOCIATION, a national banking association (“KeyBank”), its successors and assigns, individually and as a lender and administrative agent (referred to in such capacity as “Agent” in this Agreement), and each of the undersigned lending institutions (KeyBank, as a lender, and each such lending institution, and their respective successors and assigns, referred to individually or collectively, as the context shall infer, as the “Lender”).

WITNESSETH :

RECITALS

A. Borrower is the owner in fee simple of the land located in the Elk Grove Village, County of Cook, State of Illinois, and is legally described in Exhibit A attached hereto (the “ Land ”). Borrower proposes to construct on the Land the first phase of a data center facility to consist when fully completed of approximately 485,000 gross square feet and 211,140 raised square feet with a critical load of 36.4 megawatts. The first phase will consist of approximately 121,223 raised square feet with a critical load of 18.2 megawatts. As of the date hereof, a substantial amount of the construction of this first phase has been completed.

B. Borrower has applied to Lender for a loan in the amount of up to One Hundred Forty-Eight Million Eight Hundred Sixty-Four Thousand Three Hundred Thirty-Five and No/100 Dollars ($148,864,335.00) (the “ Loan ”) to reimburse Borrower for construction and development of the Project, and Lender is willing to make the Loan on the terms and conditions hereinafter set forth.

NOW, THEREFORE, in consideration of the mutual covenants and agreements herein contained, the parties hereto agree as follows:

ARTICLE 1

INCORPORATION OF RECITALS AND EXHIBITS

 

1.1	Incorporation of Recitals .

The foregoing preambles and all other recitals set forth herein are made a part hereof by this reference.

 

1.2	Incorporation of Exhibits .

Exhibits A through M, to this Agreement, attached hereto are incorporated in this Agreement and expressly made a part hereof by this reference.

 

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ARTICLE 2

DEFINITIONS

 

2.1	Defined Terms .

The following terms as used herein shall have the following meanings:

Adjusted LIBOR Rate : For any LIBOR Rate Interest Period, an interest rate per annum equal to the sum of (A) the rate obtained by dividing (x) the LIBOR Rate for such LIBOR Rate Interest Period by (y) a percentage equal to one hundred percent (100%) minus the Reserve Percentage for such LIBOR Rate Interest Period and (B) the LIBOR Rate Margin.

Adjusted Base Rate : A rate per annum equal to the greater of (a) the Prime Rate and (b) one-half of one percent (0.5%) in excess of the Federal Funds Effective Rate. Any change in the Adjusted Base Rate shall be effective immediately from and after a change in the Adjusted Base Rate (or the Federal Funds Effective Rate, as applicable).

Affiliate . An Affiliate, as applied to any Person, shall mean any other Person directly or indirectly controlling, controlled by, or under common control with, that Person. For purposes of this definition, “control” (including, with correlative meanings, the terms “controlling”, “controlled by” and “under common control with”), as applied to any Person, means (a) the possession, directly or indirectly, of the power to vote ten percent (10%) or more of the stock, shares, voting trust certificates, beneficial interest, partnership interests, member interests or other interests having voting power for the election of directors of such Person or otherwise to direct or cause the direction of the management and policies of that Person, whether through the ownership of voting securities or by contract or otherwise, or (b) the ownership of (i) a general partnership interest, (ii) a managing member’s or manager’s interest in a limited liability company or (iii) a limited partnership interest or preferred stock (or other ownership interest) representing ten percent (10%) or more of the outstanding limited partnership interests, preferred stock or other ownership interests of such Person.

Agent’s Head Office : The Agent’s head office located at 127 Public Square, Cleveland, Ohio 44114-1306, or at such other location as the Agent may designate from time to time by notice to the Borrower and the Lenders.

Agent’s Special Counsel : McKenna Long & Aldridge LLP or such other counsel as selected by Agent.

Agreement : This Construction Loan Agreement.

Applicable Rate : As such term is defined in Section 5.1(a) .

Appraisal : An MAI appraisal of the value of the Project, determined on a “going concern” value basis, performed by an independent appraiser with experience appraising data center properties selected by the Agent who is not an employee of Guarantor or its Subsidiaries, the Agent or a Lender, the form and substance of such appraisal and the identity of the appraiser to be in compliance with the Financial Institutions Reform, Recovery and Enforcement Act of 1989, as amended, the rules and regulations adopted pursuant thereto and all other regulatory laws and policies (both regulatory and internal) applicable to the Lenders and otherwise acceptable to the Agent.

 

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Appraised Value : The “going concern” value of the Project determined by the most recent Appraisal of the Project, obtained pursuant to this Agreement; subject, however, to such changes or adjustments to the value determined thereby as may be required by the appraisal department of the Agent in its good faith business judgment based on criteria and factors generally used and considered by the Agent in determining the value of similar properties.

Approved Lease : Any Lease that meets the following criteria shall not require Agent’s or Lenders’ prior written approval: (i) the rental rate thereunder is at least ninety percent (90%) of the rental rate in the Pro Forma Projection; (ii) the lease term is for a minimum of five (5) consecutive years; (iii) the Lease does not contain any early termination rights in favor of Tenant other than those contained in customary casualty and condemnation provisions; (iv) the proposed Tenant has been operating and profitable for a minimum of five (5) consecutive years, or such Tenant’s long-term senior debt rating is rated at least BBB- by S&P or the equivalent thereof by Moody’s; and (v) the Lease is entered into on the Borrower’s standard form lease, which has been approved by Agent, without any material modifications.

Architect : Donnally Vujcic Associates, L.L.C.

Architect’s Certificate : A certificate in the form of Exhibit G attached hereto executed by the Architect in favor of Lender.

Assignment and Assumption : An Assignment and Assumption Agreement in the form of Exhibit L attached hereto and made a part hereof.

Assignment of Rents : An assignment of leases and rents made by Borrower in favor of Agent assigning all leases, subleases and other agreements relating to the use and occupancy of all or any portion of the Project, and all present and future leases, rents, issues and profits therefrom.

Authorized Representative : Hossein Fateh or Lammot J. du Pont, or such other Person as Borrower may designate in writing to Agent from time to time.

Bankruptcy Code : Title 11 of the United States Code entitled “Bankruptcy” as now or hereafter in effect, or any successor statute thereto or any other present or future bankruptcy or insolvency statute.

Bond : A Performance Bond and Labor and Material Payment Bond in a form approved by Agent, with the Major Subcontractors, as the case may be, as principal, with a surety company acceptable to Agent and licensed to do business in the State, as surety, with a dual obligee rider in favor of Agent.

Breakage Costs : The cost to Lender of re-employing funds bearing or to bear interest at an Adjusted LIBOR Rate, incurred (or expected to be incurred) in connection with (i) any payment of any portion of the Loan bearing interest at an Adjusted LIBOR Rate prior to the termination of any applicable LIBOR Rate Interest Period, (ii) the conversion of an Adjusted

 

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LIBOR Rate to any other applicable interest rate on a date other than the last day of the relevant LIBOR Rate Interest Period, or (iii) the failure of Borrower to draw down, on the first day of the applicable LIBOR Rate Interest Period, any amount as to which Borrower has elected a LIBOR Rate Option.

Budget : The budget for the Project specifying all costs and expenses of every kind and nature whatever to be incurred by Borrower in connection with the Project prior to the Maturity Date.

Budget Line Item : As such term is defined in Section 10.2 .

Business Day : A day of the year on which banks are not required or authorized to close in Cleveland, Ohio.

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

(a) Any Person (including a Person’s Affiliates and associates) or group (as that term is understood under Section 13(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) and the rules and regulations thereunder), other than Lammot du Pont and Hossein Fateh and their respective controlled Affiliates, shall have acquired beneficial ownership (within the meaning of Rule 13d-3 under the Exchange Act) of a percentage (based on voting power, in the event different classes of stock or voting interests shall have different voting powers) of the voting stock or voting interests of REIT or Guarantor equal to at least twenty percent (20%);

(b) As of any date a majority of the Board of Directors or Trustees or similar body (the “Board”) of REIT or Guarantor consists of individuals who were not either (i) directors or trustees of REIT or Guarantor as of the corresponding date of the previous year, or (ii) selected or nominated to become directors or trustees by the Board of REIT or Guarantor of which a majority consisted of individuals described in clause (b)(i) above, or (iii) selected or nominated to become directors or trustees by the Board of REIT or Guarantor, which majority consisted of individuals described in clause (b)(i) above and individuals described in clause (b)(ii), above (excluding, in the case of both clause (ii) and (iii) above, any individual whose initial nomination for, or assumption of office as, a member of the Board occurs as a result of an actual or threatened solicitation of proxies or consents for the election or removal of one or more directors or trustees by any Person or group other than a solicitation for the election of one or more directors or trustees by or on behalf of the Board); or

(c) the Borrower or Guarantor consolidates with, is acquired by, or merges into or with any Person (other than a merger permitted by §15.1(jj)); or

(d) REIT shall fail to own at least thirty-three percent (33%) of the economic, voting and beneficial interests in Guarantor, or shall fail to own such interests free of any lien, encumbrance or other adverse claim; or

 

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

(f) Guarantor fails to own directly or indirectly, free of any lien, encumbrance or other adverse claim, at least one hundred percent (100%) of the economic, voting and beneficial interest of Borrower (except that REIT may own up to one percent (1%) of Safari Ventures LLC); or

(g) Any of Lammot du Pont and Hossein Fateh shall cease to be senior management executives of the REIT and a competent and experienced successor senior management executive, as applicable, shall not be reasonably approved by the Required Lenders within three (3) months of such event.

Change Order : Any request for changes in the Plans and Specifications (other than minor field changes involving no extra cost).

Collateral . All of (a) the property, rights and interests of the Borrower that are or are intended to be subject to the security interests, assignments, and mortgage liens created by the Security Documents, including, without limitation, the Project, and (b) the Guaranty.

Commitment : The maximum amount each Lender has agreed to lend to Borrower as part of the Loan (which amounts are set forth below the signature line of each Lender), subject to modification by each Assignment and Assumption.

Completion Conditions : Delivery to Agent of the following items in form satisfactory to the Agent:

(A) Required Permits . Evidence that the Borrower has obtained all Required Permits from, given all notices to, and taken all such other actions with respect to, such Governmental Authority as may be required under applicable laws and requirements for the permanent use and occupancy of the Improvements for their intended uses, together with copies of all such Required Permits;

(B) Approval by Lender’s Consultant . Notification from the Lender’s Consultant to the effect that the Improvements have been completed in a good and workmanlike manner in accordance with the Plans and Specifications;

(C) Certificate of the Borrower’s Architect . Certificate of the Borrower’s architect that the Improvements have been completed in accordance with the Plans and Specifications and that the Improvements comply with all applicable laws and requirements and Governmental Approvals and are in all respects ready for use and occupancy;

(D) Payment of Costs . Evidence satisfactory to Agent that all sums due in connection with the construction of the Improvements have been paid or discharged in full (whether by bonding or otherwise) and that no party claims or has a right to claim any statutory or common law lien arising out of the construction of the Improvements for the supplying of labor, material, equipment and/or services in connection therewith;

 

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(E) Final Lien Waivers . Final lien waivers in such form as may be permitted by applicable law to remove or dissolve any unfiled lien claims, or such other form satisfactory to the Agent from the General Contractors, and such laborers, suppliers, subcontractors and materialmen as may be requested by the Agent, duly executed and notarized (or with respect to any lien claims for which final lien waivers are not provided, evidence satisfactory to Agent that such lien claims have been discharged in full (whether by bonding or otherwise));

(F) Title Endorsement . An endorsement to the Title Policy fully removing any exception for mechanics and materialman’s liens, whether filed or unfiled.

(G) Power . The Improvements shall have at least 18.2 megawatts of critical load power available for use by Tenants.

Completion Date : June 30, 2008, subject to extension pursuant to Section 15.1(b) .

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

Construction or construction : The construction and equipping of the Improvements in accordance with the Plans and Specifications, and the installation of all personal property, fixtures and equipment required for the operation of the Project.

Construction Schedule : A schedule satisfactory to Lender and Lender’s Consultant, establishing a timetable for completion of the Construction, showing, on a monthly basis, the anticipated progress of the Construction and also showing that the Improvements can be completed on or before the Completion Date, as the same may be modified or amended with the written approval of Agent.

Contingency Fund : A Budget Line Item which shall represent an amount necessary to provide reasonable assurances to Lender that additional funds are available to be used if additional costs and expenses are incurred or additional interest accrues on the Loan, or unanticipated events or problems occur.

Control : As such term is used with respect to any person or entity, including the correlative meanings of the terms “controlled by” and “under common control with”, shall mean the possession, directly or indirectly, of the power to direct or cause the direction of the management policies of such person or entity, whether through the ownership of voting securities, by contract or otherwise.

Debt Service Coverage : With respect to a particular period, the ratio of (a) the Net Operating Income of the Project to (b) the Total Annual Debt Service.

Default or default : Any event, circumstance or condition, which, if it were to continue uncured, would, with notice or lapse of time or both, constitute an Event of Default hereunder.

Defaulting Lender : As such term is defined in Section 25.5(b) .

 

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Default Rate : A rate per annum equal to two percentage points (200 basis points) in excess of the Applicable Rate, but not at any time in excess of the highest rate permitted by law.

Deficiency Deposit : As such term is defined in Section 11.1 .

Eligible Assignee : (i) Any Lender; (ii) any commercial bank, savings bank, savings and loan association or similar financial institution which (A) has total assets of Five Billion Dollars ($5,000,000,000) or more, (B) is “well capitalized” within the meaning of such term under the regulations promulgated under the auspices of the Federal Deposit Insurance Corporation Improvement Act of 1991, (C) in the reasonable judgment of the Agent, is engaged in the business of lending money and extending credit, and buying loans or participations in loans under credit facilities substantially similar to those extended under this Agreement, and (D) in the reasonable judgment of the Agent, is operationally and procedurally able to meet the obligations of a Lender hereunder to the same degree as a commercial bank; (iii) any insurance company in the business of writing insurance which (A) has total assets of Five Billion Dollars ($5,000,000,000) or more (B) is “best capitalized” within the meaning of such term under the applicable regulations of the National Association of Insurance Commissioners, and (C) meets the requirements set forth in subclauses (C) and (D) of clause (ii) above; and (iv) any other financial institution having total assets of Five Billion Dollars ($5,000,000,000) (including a mutual fund or other fund under management of any investment manager having under its management total assets of Five Billion Dollars ($5,000,000,000) or more) which meets the requirement set forth in subclauses (C) and (D) of clause (ii) above; provided that each Eligible