Alterations and Expansions. Borrower shall not perform or undertake or consent to the performance or undertaking of any Alteration or Expansion, except in accordance with the following terms and conditions: (a) The Alteration or Expansion shall be undertaken in accordance with the applicable provisions of this Agreement, the other Loan Documents, the Leases and all Legal Requirements. (b) No Event of Default shall have occurred and be continuing or shall occur as a result of such action. (c) A Material Alteration or Material Expansion, to the extent architects are customarily used for alterations or expansions of those types, but including any structural change to any of the Property or the Improvements, shall be conducted under the supervision of an Independent Architect and shall not be undertaken until ten (10) Business Days after there shall have been filed with Lender, for information purposes only and not for approval by Lender, detailed plans and specifications and cost estimates therefor, prepared and approved in writing by such Independent Architect. Such plans and specifications may be revised at any time and from time to time, provided that revisions of such plans and specifications shall be filed with Lender, for information purposes only. (d) The Alteration or Expansion may not in and of itself, either during the Alteration or Expansion or upon completion, be reasonably expected to have a Material Adverse Effect with respect to the Property. (e) All work done in connection with any Alteration or Expansion shall be performed with due diligence to Final Completion in a good and workmanlike manner, all materials used in connection with any Alteration or Expansion shall be not less than the standard of quality of the materials generally used at the Property as of the date hereof (or, if greater, the then-current customary quality in the sub-market in which the Property is located) and all work shall be performed and all materials used in accordance with all applicable Legal Requirements and Insurance Requirements. (f) The cost of any Alteration or Expansion shall be promptly and fully paid for by Borrower, subject to the next succeeding sentence. No payment made prior to the Final Completion (excluding punch-list items) of an Alteration or Expansion or Restoration to any contractor, subcontractor, materialman, supplier, engineer, architect, project manager or other Person who renders services or furnishes materials in connection with such Alteration shall exceed ninety percent (90%) of the aggregate value of the work performed by such Person from time to time and materials furnished and incorporated into the Improvements. (g) All work performed in connection with the cure of the Deferred Maintenance Conditions shall be performed in accordance with the terms and conditions set forth in clauses (a), (c), (e) and (f) of this Section 10.2. (h) With respect to any Material Alteration or Material Expansion: (i) Borrower shall have delivered to Lender Eligible Collateral in an amount equal to at least the total estimated remaining unpaid costs of such Material Alteration or Material Expansion which is in excess of the Threshold Amount, which Eligible Collateral shall be held by Lender as security for the Indebtedness and released to Borrower as such work progresses in accordance with Section 10.2(h)(iii); provided, however, in the event that any Material Alteration or Material Expansion shall be made in conjunction with any Restoration with respect to which Borrower shall be entitled to use or apply Proceeds pursuant to Section 6.2 hereof (including any Proceeds remaining after completion of such Restoration), the amount of the Eligible Collateral to be furnished pursuant hereto need not exceed the aggregate cost of such Restoration and such Material Alteration or Material Expansion (in either case, as estimated by the Independent Architect) less the sum of the amount of any Proceeds which the Borrower is entitled to withdraw pursuant to Section 6.2 hereof and the Threshold Amount; (ii) Prior to commencement of construction of such Material Alteration or Material Expansion, Borrower shall deliver to Lender a schedule (with the concurrence of the Independent Architect) setting forth the projected stages of completion of such Alteration or Expansion and the corresponding amounts expected to be due and payable by or on behalf of Borrower in connection with such completion, such schedule to be updated quarterly by Borrower (and with the concurrence of the Independent Architect) during the performance of such Alteration or Expansion. (iii) Any Eligible Collateral that a Borrower delivers to Lender pursuant hereto (and the proceeds of any such Eligible Collateral) shall be invested (to the extent such Eligible Collateral can be invested) by Lender in Permitted Investments for a period of time consistent with the date on which the Borrower notifies Lender that the Borrower expects to request a release of such Eligible Collateral in accordance with the next succeeding sentence. From time to time as the Alteration or Expansion progresses, the amount of any Eligible Collateral so furnished may, upon the written request of Borrower to Lender, be withdrawn by Borrower and paid or otherwise applied by or returned to Borrower in an amount equal to the amount Borrower would be entitled to so withdraw if Section 6.2.4 were applicable, and any Eligible Collateral so furnished which is a Letter of Credit may be reduced by Borrower in an amount equal to the amount Borrower would be entitled to so reduce if Section 6.2.4 hereof were applicable, subject, in each case, to the satisfaction of the conditions precedent to withdrawal of funds or reduction of the Letter of Credit set forth in Section 6.2.4 hereof. In connection with the above-described quarterly update of the projected stages of completion of the Material Alteration or Material Expansion (as concurred with by an Independent Architect), Borrower shall increase (or be permitted to decrease, as applicable) the Eligible Collateral then deposited with Lender as necessary to comply with Section 10.2(h)(i) hereof. (iv) At any time after Final Completion of such Material Alterations or Material Expansions, the whole balance of any Cash deposited with Lender pursuant to Section 10.2(h) hereof then remaining on deposit may be withdrawn by Borrower and shall be paid by Lender to Borrower, and any Eligible Collateral so deposited shall, to the extent it has not been called upon, reduced or theretofore released, be released by Lender to Borrower, within ten (10) days after receipt by Lender of an application for such withdrawal and/or release together with an Officer’s Certificate, and as to the following clauses (A) and (B) of this clause also a certificate of the Independent Architect, setting forth in substance as follows: (A) that such Material Alteration(s) or Material Expansion(s) has been completed in all material respects in accordance with any plans and specifications therefor previously filed with Lender under Section 10.2(c) hereof; (B) that to the knowledge of the certifying Person, (x) such Material Alteration(s) or Material Expansion(s) has been completed in compliance with all Legal Requirements, and (y) to the extent required for the legal use or occupancy of the portion of the Property affected by such Alteration(s) or Expansion(s), the applicable Borrower has obtained a temporary or permanent certificate of occupancy (or similar certificate) or, if no such certificate is required, a statement to that effect; (C) that to the knowledge of the certifying Person, all amounts that a Borrower is or may become liable to pay in respect of such Material Alteration(s) or Material Expansion(s) through the date of the certification have been paid in full or adequately provided for and, to the extent that such are customary and reasonably obtainable by prudent property owners in the area where the applicable Property is located, that Lien waivers have been obtained from the general contractor and subcontractors performing such Alteration(s) or Expansion(s) or at its sole cost and expense, Borrower shall cause a nationally recognized title insurance company to deliver to Lender an endorsement to the Title Policy, updating such policy and insuring over such Liens without further exceptions to such policy other than Permitted Encumbrances, or shall, at its sole cost and expense, cause a reputable title insurance company to deliver a lender’s title insurance policy, in such form, in such amounts and with such endorsements as the Title Policy, which policy shall be dated the date of completion of the Material Alteration and shall contain no exceptions other than Permitted Encumbrances; provided, however, that if, for any reason, Borrower is unable to deliver the certification required by this clause (C) with respect to any costs or expenses relating to the Alteration(s) or Expansion(s), then, assuming Borrower is able to satisfy each of the other requirements set forth in clauses (A) and (B) above, Borrower shall be entitled to the release of the difference between the whole balance of such Eligible Collateral and the total of all costs and expenses to which Borrower is unable to certify; and (D) that to the knowledge of the certifying Person, no Event of Default has occurred and is continuing.

Appears in 4 contracts

Samples: Loan and Security Agreement (Strategic Hotels & Resorts, Inc), Loan and Security Agreement (Strategic Hotels & Resorts, Inc), Loan and Security Agreement (Strategic Hotels & Resorts, Inc)

Alterations and Expansions. ~~Borrower~~ Tenant shall not ~~perform~~ make or ~~undertake or consent to the performance or undertaking of~~ permit any Alteration or Expansion, except in accordance with the following terms and conditions: (a) The Alteration or Expansion shall be undertaken in accordance with the applicable provisions of this Agreement, the other Loan Documents, the Leases and all Legal Requirements. (b) No Event of Default shall have occurred and be continuing or shall occur as a result of such action. (c) A Material Alteration or Material Expansion, to the extent architects are customarily used for alterations or ~~expansions~~ improvements in, on or about the Leased Premises without the prior written consent of ~~those types~~Landlord, ~~but including any structural change to any of the Property or the Improvements, shall be conducted under the supervision of an Independent Architect and~~ which consent shall not be ~~undertaken until ten (10) Business Days after there~~ unreasonably withheld, but may be conditioned. If any improvements and/or alterations are approved by Landlord, Tenant shall ~~have been filed with Lender, for information purposes only and not for approval by Lender, detailed~~ submit all plans and specifications relating to such to Landlord for review and ~~cost estimates therefor, prepared and approved in writing by such Independent Architect. Such plans and specifications may be revised at any time and from time~~ approval prior to ~~time, provided that revisions~~ commencement of such ~~plans~~ improvements and/or alterations. Tenant covenants and ~~specifications~~ agrees that all improvements and alterations done hereunder shall be filed with Lender, for information purposes only. (d) The Alteration or Expansion may not in and of itself, either during the Alteration or Expansion or upon completion, be reasonably expected to have a Material Adverse Effect with respect to the Property. (e) All work done in connection with any Alteration or Expansion shall be performed with due diligence to Final Completion in a good and workmanlike manner, all materials used in connection with any Alteration or Expansion shall be not less than the standard of quality of the materials generally used at the Property as of the date hereof (or, if greater, the then-current customary quality in the sub-market in which the Property is located) and all work shall be performed and all materials used in accordance with all applicable Legal Requirements and Insurance Requirements. (f) The cost of any Alteration or Expansion shall be promptly and fully paid for by Borrower, subject to the next succeeding sentence. No payment made prior to the Final Completion (excluding punch-list items) of an Alteration or Expansion or Restoration to any contractor, subcontractor, materialman, supplier, engineer, architect, project manager or other Person who renders services or furnishes materials in connection with such Alteration shall exceed ninety percent (90%) of the aggregate value of the work performed by such Person from time to time and materials furnished and incorporated into the Improvements. (g) All work performed in connection with the cure of the Deferred Maintenance Conditions shall be performed otherwise in accordance with the terms ~~and conditions set forth in clauses (a), (c), (e) and (f)~~ of this ~~Section 10.2.~~ Lease and the Governing Documents for the Resort. Further, Tenant represents that all improvements and alterations shall be completed within ninety (h90) ~~With respect to any Material Alteration or Material Expansion: (i) Borrower~~ days from the execution of this Lease, and shall ~~have delivered to Lender Eligible Collateral in an amount equal to at least~~ not materially interfere with the ~~total estimated remaining unpaid costs of such Material Alteration or Material Expansion which is in excess~~ use and enjoyment of the ~~Threshold Amount~~Leased Premises or the Resort by the owners, ~~which Eligible Collateral~~ guests and invitees at the Resort. All permitted alterations, additions or improvements shall be ~~held by Lender as security for the Indebtedness~~ installed at Tenant's sole cost and released to Borrower as such work progresses in accordance with Section 10.2(h)(iii); provided, however, in the event that any Material Alteration or Material Expansion shall be made in conjunction with any Restoration with respect to which Borrower shall be entitled to use or apply Proceeds pursuant to Section 6.2 hereof (including any Proceeds remaining after completion of such Restoration), the amount of the Eligible Collateral to be furnished pursuant hereto need not exceed the aggregate cost of such Restoration and such Material Alteration or Material Expansion (in either case, as estimated by the Independent Architect) less the sum of the amount of any Proceeds which the Borrower is entitled to withdraw pursuant to Section 6.2 hereof and the Threshold Amount; (ii) Prior to commencement of construction of such Material Alteration or Material Expansion, Borrower shall deliver to Lender a schedule (with the concurrence of the Independent Architect) setting forth the projected stages of completion of such Alteration or Expansion and the corresponding amounts expected to be due and payable by or on behalf of Borrower in connection with such completion, such schedule to be updated quarterly by Borrower (and with the concurrence of the Independent Architect) during the performance of such Alteration or Expansion. (iii) Any Eligible Collateral that a Borrower delivers to Lender pursuant hereto (and the proceeds of any such Eligible Collateral) shall be invested (to the extent such Eligible Collateral can be invested) by Lender in Permitted Investments for a period of time consistent with the date on which the Borrower notifies Lender that the Borrower expects to request a release of such Eligible Collateral in accordance with the next succeeding sentence. From time to time as the Alteration or Expansion progresses, the amount of any Eligible Collateral so furnished may, upon the written request of Borrower to Lender, be withdrawn by Borrower and paid or otherwise applied by or returned to Borrower in an amount equal to the amount Borrower would be entitled to so withdraw if Section 6.2.4 were applicableexpense, and any Eligible Collateral so furnished which is a Letter of Credit may be reduced by Borrower in an amount equal to the amount Borrower would be entitled to so reduce if Section 6.2.4 hereof were applicable, subject, in each case, to the satisfaction of the conditions precedent to withdrawal of funds or reduction of the Letter of Credit set forth in Section 6.2.4 hereof. In connection with the above-described quarterly update of the projected stages of completion of the Material Alteration or Material Expansion (as concurred with by an Independent Architect), Borrower shall increase (or be permitted to decrease, as applicable) the Eligible Collateral then deposited with Lender as necessary to comply with Section 10.2(h)(i) hereof. (iv) At any time after Final Completion of such Material Alterations or Material Expansions, the whole balance of any Cash deposited with Lender pursuant to Section 10.2(h) hereof then remaining on deposit may be withdrawn by Borrower and shall be paid by Lender to Borrower, and any Eligible Collateral so deposited shall, to the extent it has not been called upon, reduced or theretofore released, be released by Lender to Borrower, within ten (10) days after receipt by Lender of an application for such withdrawal and/or release together with an Officer’s Certificate, and as to the following clauses (A) and (B) of this clause also a certificate of the Independent Architect, setting forth in substance as follows: (A) that such Material Alteration(s) or Material Expansion(s) has been completed in all material respects in accordance with any plans and specifications therefor previously filed with Lender under Section 10.2(c) hereof; (B) that to the knowledge of the certifying Person, (x) such Material Alteration(s) or Material Expansion(s) has been completed in compliance with all ~~Legal Requirements~~applicable laws, ordinances, regulations, building and fire codes. All structural alterations additions and improvements must be performed by a licensed contractor according to plans and specifications approved in writing by Landlord, which approval may be withheld or conditioned for any or no reason. It is understood and agreed by Tenant that any and all alterations, additions or improvements and/or fixtures placed in or upon the Leased Premises by Tenant, or that are affixed so that they cannot be removed without material damage to any part of the Leased Premises, shall be deemed to be a part of the Leased Premises and not trade fixtures, and ~~(y)~~ shall be surrendered with the Leased Premises upon termination of this Lease. The immediately preceding sentence shall not apply to the extent required for the legal use or occupancy of the portion of the Property affected by such Alteration(s) or Expansion(s), the applicable Borrower has obtained a temporary or permanent certificate of occupancy (or similar certificate) or, if no such certificate is required, a statement to that effect; (C) that to the knowledge of the certifying Person, all amounts that a Borrower is or may become liable to pay in respect of such Material Alteration(s) or Material Expansion(s) through the date of the certification have been paid in full or adequately provided for and, Tenant's Equipment to the extent that such ~~are customary and reasonably obtainable~~ may be removed without material damage to any part of the Leased Premises. Landlord shall have no obligation to reimburse Tenant for any costs associated with any such alterations, additions, improvements or fixtures surrendered with the Leased Premises. Tenant covenants to keep the Leased Premises free from any liens arising out of any work performed, materials furnished or obligations incurred by prudent property owners in the area where the applicable Property is located, that Lien waivers have been obtained from the general contractor and subcontractors performing such Alteration(s) or Expansion(s) or at its sole cost and expense, Borrower Tenant. Tenant shall cause a nationally recognized title insurance company to deliver to Lender an endorsement to the Title Policy, updating such policy and insuring over such Liens without further exceptions to such policy other than Permitted Encumbrances, or shallcause, at its sole cost and expense, ~~cause a reputable title insurance company~~ any such lien imposed to ~~deliver a lender’s title insurance policy~~be released of record within ten (10) days after imposition of the lien or upon written request of Landlord. Tenant shall further indemnify and hold Landlord harmless from and against any cost, expense, liability, demand, violation, loss or action arising from or in connection with any and all work performed by Tenant at the Leased Premises, including without limitation, any liens arising from the same. Provided Tenant causes any lien to be released within such ~~form~~ten (10) day period, nothing in ~~such amounts and with such endorsements as the Title Policy, which policy~~ this Section shall be ~~dated the date of completion of the Material Alteration and shall contain no exceptions other than Permitted Encumbrances; provided, however, that if, for~~ construed as to prohibit Tenant from contesting any ~~reason, Borrower is unable to deliver the certification required by this clause (C) with respect to any costs~~ lien or expenses relating to the Alteration(s) or Expansion(s), then, assuming Borrower is able to satisfy each of the other requirements set forth in clauses (A) and (B) above, Borrower shall be entitled to the release of the difference between the whole balance of such Eligible Collateral and the total of all costs and expenses to amount claimed thereunder which ~~Borrower is unable to certify; and (D) that to the knowledge of the certifying Person, no Event of Default has occurred and is continuing~~Tenant deems objectionable.

Appears in 2 contracts

Samples: Assignment of Lease Agreement (Kisses From Italy, Inc.), Assignment of Lease Agreement (Kisses From Italy, Inc.)

Alterations and Expansions. Borrower shall not perform or undertake or consent to the performance or undertaking of any Alteration or Expansion, except in accordance with the following terms and conditions: (a) The Alteration or Expansion shall be undertaken in accordance with the applicable provisions of this Agreement, the other Loan Documents, the Leases and all Legal Requirements. (b) No Event of Default shall have occurred and be continuing or shall occur as a result of such action. (c) A Material Alteration or Material Expansion, to the extent architects are customarily used for alterations or expansions of those types, but including any structural change to any of the Property or the Improvements, shall be conducted under the supervision of an Independent Architect and shall not be undertaken until ten (10) Business Days after there shall have been filed with Lender, for information purposes only and not for approval by Lender, detailed plans and specifications and cost estimates therefor, prepared and approved in writing by such Independent Architect. Such plans and specifications may be revised at any time and from time to time, provided that revisions of such plans and specifications shall be filed with Lender, for information purposes only. (d) The Alteration or Expansion may not in and of itself, either during the Alteration or Expansion or upon completion, be reasonably expected to have a Material Adverse Effect with respect to the Property. (e) All work done in connection with any Alteration or Expansion shall be performed with due diligence to Final Completion in a good and workmanlike manner, all materials used in connection with any Alteration or Expansion shall be not less than the standard of quality of the materials generally used at the Property as of the date hereof (or, if greater, the then-current customary quality in the sub-market in which the Property is located) and all work shall be performed and all materials used in accordance with all applicable Legal Requirements and Insurance Requirements. (f) The cost of any Alteration or Expansion shall be promptly and fully paid for by Borrower, subject to the next succeeding sentence. No payment made prior to the Final Completion (excluding punch-list items) of an Alteration or Expansion or Restoration to any contractor, subcontractor, materialman, supplier, engineer, architect, project manager or other Person who renders services or furnishes materials in connection with such Alteration shall exceed ninety percent (90%) of the aggregate value of the work performed by such Person from time to time and materials furnished and incorporated into the Improvements. (g) All work performed in connection with the cure of the Deferred Maintenance Conditions shall be performed in accordance with the terms and conditions set forth in clauses (a), (c), (e) and (f) of this Section 10.2Intentionally Deleted. (h) With respect to any Material Alteration or Material Expansion: (i) Borrower shall have delivered to Lender Eligible Collateral in an amount equal to at least the total estimated remaining unpaid costs of such Material Alteration or Material Expansion which is in excess of the Threshold Amount, which Eligible Collateral shall be held by Lender as security for the Indebtedness and released to Borrower as such work progresses in accordance with Section 10.2(h)(iii); provided, however, in the event that any Material Alteration or Material Expansion shall be made in conjunction with any Restoration with respect to which Borrower shall be entitled to use or apply Proceeds pursuant to Section 6.2 hereof (including any Proceeds remaining after completion of such Restoration), the amount of the Eligible Collateral to be furnished pursuant hereto need not exceed the aggregate cost of such Restoration and such Material Alteration or Material Expansion (in either case, as estimated by the Independent Architect) less the sum of the amount of any Proceeds which the Borrower is entitled to withdraw pursuant to Section 6.2 hereof and the Threshold Amount; (ii) Prior to commencement of construction of such Material Alteration or Material Expansion, Borrower shall deliver to Lender a schedule (with the concurrence of the Independent Architect) setting forth the projected stages of completion of such Alteration or Expansion and the corresponding amounts expected to be due and payable by or on behalf of Borrower in connection with such completion, such schedule to be updated quarterly by Borrower (and with the concurrence of the Independent Architect) during the performance of such Alteration or Expansion. (iii) Any Eligible Collateral that a Borrower delivers to Lender pursuant hereto (and the proceeds of any such Eligible Collateral) shall be invested (to the extent such Eligible Collateral can be invested) by Lender in Permitted Investments for a period of time consistent with the date on which the Borrower notifies Lender that the Borrower expects to request a release of such Eligible Collateral in accordance with the next succeeding sentence. From time to time as the Alteration or Expansion progresses, the amount of any Eligible Collateral so furnished may, upon the written request of Borrower to Lender, be withdrawn by Borrower and paid or otherwise applied by or returned to Borrower in an amount equal to the amount Borrower would be entitled to so withdraw if Section 6.2.4 were applicable, and any Eligible Collateral so furnished which is a Letter of Credit may be reduced by Borrower in an amount equal to the amount Borrower would be entitled to so reduce if Section 6.2.4 hereof were applicable, subject, in each case, to the satisfaction of the conditions precedent to withdrawal of funds or reduction of the Letter of Credit set forth in Section 6.2.4 hereof. In connection with the above-described quarterly update of the projected stages of completion of the Material Alteration or Material Expansion (as concurred with by an Independent Architect), Borrower shall increase (or be permitted to decrease, as applicable) the Eligible Collateral then deposited with Lender as necessary to comply with Section 10.2(h)(i) hereof. (iv) At any time after Final Completion of such Material Alterations or Material Expansions, the whole balance of any Cash deposited with Lender pursuant to Section 10.2(h) hereof then remaining on deposit may be withdrawn by Borrower and shall be paid by Lender to Borrower, and any Eligible Collateral so deposited shall, to the extent it has not been called upon, reduced or theretofore released, be released by Lender to Borrower, within ten (10) days after receipt by Lender of an application for such withdrawal and/or release together with an Officer’s Certificate, and as to the following clauses (A) and (B) of this clause also a certificate of the Independent Architect, setting forth in substance as follows: (A) that such Material Alteration(s) or Material Expansion(s) has been completed in all material respects in accordance with any plans and specifications therefor previously filed with Lender under Section 10.2(c) hereof; (B) that to the knowledge of the certifying Person, (x) such Material Alteration(s) or Material Expansion(s) has been completed in compliance with all Legal Requirements, and (y) to the extent required for the legal use or occupancy of the portion of the Property affected by such Alteration(s) or Expansion(s), the applicable Borrower has obtained a temporary or permanent certificate of occupancy (or similar certificate) or, if no such certificate is required, a statement to that effect; (C) that to the knowledge of the certifying Person, all amounts that a Borrower is or may become liable to pay in respect of such Material Alteration(s) or Material Expansion(s) through the date of the certification have been paid in full or adequately provided for and, to the extent that such are customary and reasonably obtainable by prudent property owners in the area where the applicable Property is located, that Lien waivers have been obtained from the general contractor and subcontractors performing such Alteration(s) or Expansion(s) or at its sole cost and expense, Borrower shall cause a nationally recognized title insurance company to deliver to Lender an endorsement to the Title Policy, updating such policy and insuring over such Liens without further exceptions to such policy other than Permitted Encumbrances, or shall, at its sole cost and expense, cause a reputable title insurance company to deliver a lender’s title insurance policy, in such form, in such amounts and with such endorsements as the Title Policy, which policy shall be dated the date of completion of the Material Alteration and shall contain no exceptions other than Permitted Encumbrances; provided, however, that if, for any reason, Borrower is are unable to deliver the certification required by this clause (C) with respect to any costs or expenses relating to the Alteration(s) or Expansion(s), then, assuming Borrower is are able to satisfy each of the other requirements set forth in clauses (A) and (B) above, Borrower shall be entitled to the release of the difference between the whole balance of such Eligible Collateral and the total of all costs and expenses to which Borrower is are unable to certify; and (D) that to the knowledge of the certifying Person, no Event of Default has occurred and is continuing.

Appears in 2 contracts

Samples: Loan and Security Agreement (Strategic Hotels & Resorts, Inc), Loan and Security Agreement (Strategic Hotels & Resorts, Inc)

Alterations and Expansions. ~~Borrower shall not perform or undertake or consent to the performance or undertaking of any Alteration or Expansion, except in accordance with the following terms~~ Section 9.1 Alterations and ~~conditions:~~Expansions -------------------------- (a) ~~The Alteration~~ Tenant may at its expense and without Landlord's prior written consent, make any replacements or Expansion shall be undertaken in accordance with the applicable provisions of this Agreement, the other Loan Documents, the Leases and all Legal Requirements. (b) No Event of Default shall have occurred and be continuing or shall occur as a result of such action. (c) A Material Alteration or Material Expansion, to the extent architects are customarily used for aesthetic alterations ~~or expansions of those types, but including any structural change~~ to any of the ~~Property~~ Hotels. Tenant may expand the existing Improvements or construct additional Improvements on the Land located at a Hotel (the expansion of existing Improvements or the construction of additional Improvements being referred to collectively herein as an "Expansion"), provided, that: (i) such Expansion does not (A) increase the rooms available for occupancy at the subject Hotel by greater than 10% of those existing as of the Commencement Date; or (B) increase the net area of other revenue producing square footage at the subject Hotel by more than 10% of that existing as of the Commencement Date, (ii) no structural elements of the improvements shall be demolished without obtaining Landlord's prior written consent, which consent shall not be unreasonably withheld, conditioned, or delayed, and (iii) such replacements, alterations and/or Expansions will not adversely affect the structure or the safety of the Improvements, or adversely affect the electrical, heating, ventilating, air-conditioning, plumbing or mechanical systems or the functioning thereof. Landlord has the right to require from Tenant assurances, reasonably acceptable to Landlord, to be delivered to Landlord prior to the commencement of any work, that Tenant will fully perform and complete its Expansion, free and clear of any mechanics' and materialmen's liens. Tenant shall procure at its own expense such governmental approvals and permits as may be required for any alterations made by Tenant. At Tenant's expense, Landlord shall join in submitting Tenant's plans for any necessary governmental approval, if required by Legal Requirements. All such construction, alterations, and maintenance work done by, or for, Tenant, shall comply with all Legal Requirements and Insurance Requirements, and shall be conducted under the supervision of an Independent Architect and shall not be undertaken until ten (10) Business Days after there shall have been filed with Lender, for information purposes only and not for approval by Lender, detailed plans and specifications and cost estimates therefor, prepared and approved in writing by such Independent Architect. Such plans and specifications may be revised at any time and from time to time, provided that revisions of such plans and specifications shall be filed with Lender, for information purposes only. (d) The Alteration or Expansion may not in and of itself, either during the Alteration or Expansion or upon completion, be reasonably expected to have a Material Adverse Effect with respect to the Property. (e) All work done in connection with any Alteration or Expansion shall be performed with due diligence to Final Completion completed in a good and workmanlike manner, all materials used in connection with any Alteration or Expansion shall be not less than the standard of quality of the materials generally used at the Property as of the date hereof (or, if greater, the then-current customary quality in the sub-market in which the Property is located) and all work shall be performed and all materials used in accordance with all applicable Legal Requirements and Insurance Requirements. (f) The cost of any Alteration or Expansion shall be promptly and fully paid for by Borrower, subject to the next succeeding sentence. No payment made prior to the Final Completion (excluding punch-list items) of an Alteration or Expansion or Restoration to any contractor, subcontractor, materialman, supplier, engineer, architect, project manager or other Person who renders services or furnishes materials in connection with such Alteration shall exceed ninety percent (90%) of the aggregate value of the work performed by such Person from time to time and materials furnished and incorporated into the Improvements. (g) All work performed in connection with the cure of the Deferred Maintenance Conditions shall be performed in accordance with the terms and conditions set forth in clauses (a), (c), (e) and (f) of this Section 10.2. (h) With respect to any Material Alteration or Material Expansion: (i) Borrower shall have delivered to Lender Eligible Collateral in an amount equal to at least the total estimated remaining unpaid costs of such Material Alteration or Material Expansion which is in excess of the Threshold Amount, which Eligible Collateral shall be held by Lender as security for the Indebtedness and released to Borrower as such work progresses in accordance with Section 10.2(h)(iii); provided, however, in the event that any Material Alteration or Material Expansion shall be made in conjunction with any Restoration with respect to which Borrower shall be entitled to use or apply Proceeds pursuant to Section 6.2 hereof (including any Proceeds remaining after completion of such Restoration), the amount of the Eligible Collateral to be furnished pursuant hereto need not exceed the aggregate cost of such Restoration and such Material Alteration or Material Expansion (in either case, as estimated by the Independent Architect) less the sum of the amount of any Proceeds which the Borrower is entitled to withdraw pursuant to Section 6.2 hereof and the Threshold Amount; (ii) Prior to commencement of construction of such Material Alteration or Material Expansion, Borrower shall deliver to Lender a schedule (with the concurrence of the Independent Architect) setting forth the projected stages of completion of such Alteration or Expansion and the corresponding amounts expected to be due and payable by or on behalf of Borrower in connection with such completion, such schedule to be updated quarterly by Borrower (manner and with the concurrence of the Independent Architect) during the performance of such Alteration or Expansion. (iii) Any Eligible Collateral that a Borrower delivers to Lender pursuant hereto (and the proceeds of any such Eligible Collateral) shall be invested (to the extent such Eligible Collateral can be invested) by Lender in Permitted Investments for a period of time consistent with the date on which the Borrower notifies Lender that the Borrower expects to request a release of such Eligible Collateral in accordance with the next succeeding sentence. From time to time as the Alteration or Expansion progresses, the amount of any Eligible Collateral so furnished may, upon the written request of Borrower to Lender, be withdrawn by Borrower and paid or otherwise applied by or returned to Borrower in an amount equal to the amount Borrower would be entitled to so withdraw if Section 6.2.4 were applicablereasonable diligence, and ~~any Eligible Collateral so furnished which is a Letter of Credit may~~ will be reduced by Borrower in an amount equal to the amount Borrower would be entitled to so reduce if Section 6.2.4 hereof were applicable, subject, in each case, to the satisfaction of the conditions precedent to withdrawal of funds or reduction of the Letter of Credit set forth in Section 6.2.4 hereof. In connection with the above-described quarterly update of the projected stages of completion of the Material Alteration or Material Expansion (as concurred with by an Independent Architect), Borrower shall increase (or be permitted to decrease, as applicable) the Eligible Collateral then deposited with Lender as necessary to comply with Section 10.2(h)(i) hereof. (iv) At any time after Final Completion of such Material Alterations or Material Expansions, the whole balance of any Cash deposited with Lender pursuant to Section 10.2(h) hereof then remaining on deposit may be withdrawn by Borrower and shall be paid by Lender to Borrower, and any Eligible Collateral so deposited shall, to the extent it has not been called upon, reduced or theretofore released, be released by Lender to Borrower, within ten (10) days after receipt by Lender of an application for such withdrawal and/or release together with an Officer’s Certificate, and as to the following clauses (A) and (B) of this clause also a certificate of the Independent Architect, setting forth in substance as follows: (A) that such Material Alteration(s) or Material Expansion(s) has been completed in all material respects in accordance with plans prepared by a licensed architect. If any Expansion will cost more than One Million Dollars ($1,000,000), adjusted by the GDP Deflator, (w) Tenant shall furnish Landlord with the plans and specifications therefor ~~previously filed with Lender under Section 10.2(c) hereof; (B) that~~ prior to ~~the knowledge of the certifying Person~~commencing work, (x) the contractor selected by Tenant to perform the work shall be subject to Landlord's approval, which approval shall not be unreasonably withheld, conditioned or delayed, (y) Tenant shall carry builder's risk insurance in amounts reasonably sufficient to cover the cost of replacement of the work during the course of such ~~Material Alteration(s) or Material Expansion(s) has been completed in compliance with all Legal Requirements~~construction, and (yz) to upon the ~~extent required for the legal use~~ request of Landlord or ~~occupancy of the portion of the Property affected by such Alteration(s) or Expansion(s)~~any Mortgagee, ~~the applicable Borrower has obtained a temporary or permanent certificate of occupancy (or similar certificate) or~~Tenant will provide appropriate securities, ~~if no such certificate is required~~completion bonds, a statement to that effect; (C) that to the knowledge of the certifying Person, all amounts that a Borrower is or may become liable to pay in respect of such Material Alteration(s) or Material Expansion(s) through the date of the certification have been paid in full or adequately provided for and, to the extent that such are customary and reasonably obtainable by prudent property owners in the area where the applicable Property is located, that Lien waivers have been obtained from the general contractor and subcontractors performing such Alteration(s) or Expansion(s) or at its sole cost and expense, Borrower shall cause a nationally recognized title insurance company to deliver to Lender an endorsement to the Title Policy, updating such policy and insuring over such Liens without further exceptions to such policy other than Permitted Encumbrancesguarantees, or ~~shall, at its sole cost~~ like reasonable assurances that construction will be completed. Tenant shall also furnish Landlord with copies of any and ~~expense, cause a reputable title insurance company to deliver a lender’s title insurance policy,~~ all final plans and specifications (including all changes and modifications thereto) and all necessary governmental permits prepared or issued for all alterations (whether or not Landlord's consent was required in ~~such form, in such amounts and~~ connection with such endorsements as the Title Policy, which policy shall be dated the date of completion of the Material Alteration and shall contain no exceptions other than Permitted Encumbrances; provided, however, that if, for any reason, Borrower is unable to deliver the certification required by this clause (C) with alterations). With respect to any ~~costs~~ Expansion or ~~expenses relating~~ other alteration for which Tenant must obtain Landlord's consent, Landlord shall not unreasonably withhold, condition or delay such consent. (b) All replacements, alterations and substitutions of Improvements and Expansions made to the ~~Alteration(s~~Premises pursuant to this Article 9.1 (but not the replacement FF&E, Fixed Asset Supplies, Operating Equipment or Inventories described in Article 10.1) ~~or Expansion(s), then, assuming Borrower is able to satisfy each~~ shall be and remain part of the ~~other requirements set forth in clauses (A)~~ realty and ~~(B) above, Borrower~~ the property of Landlord and shall be ~~entitled~~ subject to the release of the difference between the whole balance of such Eligible Collateral and the total of all costs and expenses to which Borrower is unable to certify; and (D) that to the knowledge of the certifying Person, no Event of Default has occurred and is continuingthis Lease.

Appears in 2 contracts

Samples: Lease Agreement (Red Lion Hotels Inc), Contribution Agreement (Red Lion Hotels Inc)

Alterations and Expansions. Borrower shall not perform or undertake or consent to the performance or undertaking of any Alteration or Expansion, except in accordance with the following terms and conditions: (a) The Alteration or Expansion shall be undertaken in accordance with the applicable provisions of this Agreement, the other Loan Documents, the Leases and all Legal Requirements. (b) No Event of Default shall have occurred and be continuing or shall occur as a result of such action. (c) A Material Alteration or Material Expansion, to the extent architects are customarily used for alterations or expansions of those types, but including any structural change to any of the Property or the Improvements, shall be conducted under the supervision of an Independent Architect and shall not be undertaken until ten (10) Business Days after there shall have been filed with Lender, for information purposes only and not for approval by Lender, detailed plans and specifications and cost estimates therefor, prepared and approved in writing by such Independent Architect. Such plans and specifications may be revised at any time and from time to time, provided that revisions of such plans and specifications shall be filed with Lender, for information purposes only. (d) The Alteration or Expansion may not in and of itself, either during the Alteration or Expansion or upon completion, be reasonably expected to have a Material Adverse Effect with respect to the Property. (e) All work done in connection with any Alteration or Expansion shall be performed with due diligence to Final Completion in a good and workmanlike manner, all materials used in connection with any Alteration or Expansion shall be not less than the standard of quality of the materials generally used at the Property as of the date hereof (or, if greater, the then-current customary quality in the sub-market in which the Property is located) and all work shall be performed and all materials used in accordance with all applicable Legal Requirements and Insurance Requirements. (f) The cost of any Alteration or Expansion shall be promptly and fully paid for by Borrower, subject to the next succeeding sentence. No payment made prior to the Final Completion (excluding punch-list items) of an Alteration or Expansion or Restoration to any contractor, subcontractor, materialman, supplier, engineer, architect, project manager or other Person who renders services or furnishes materials in connection with such Alteration shall exceed ninety percent (90%) of the aggregate value of the work performed by such Person from time to time and materials furnished and incorporated into the Improvements. (g) All work performed in connection with the cure of the Deferred Maintenance Conditions shall be performed in accordance with the terms and conditions set forth in clauses (a), (c), (e) and (f) of this Section 10.2Intentionally Deleted. (h) With respect to any Material Alteration or Material Expansion: (i) Borrower shall have delivered to Lender Eligible Collateral in an amount equal to at least the total estimated remaining unpaid costs of such Material Alteration or Material Expansion which is in excess of the Threshold Amount, which Eligible Collateral shall be held by Lender as security for the Indebtedness and released to Borrower as such work progresses in accordance with Section 10.2(h)(iii); provided, however, in the event that any Material Alteration or Material Expansion shall be made in conjunction with any Restoration with respect to which Borrower shall be entitled to use or apply Proceeds pursuant to Section 6.2 hereof (including any Proceeds remaining after completion of such Restoration), the amount of the Eligible Collateral to be furnished pursuant hereto need not exceed the aggregate cost of such Restoration and such Material Alteration or Material Expansion (in either case, as estimated by the Independent Architect) less the sum of the amount of any Proceeds which the Borrower is entitled to withdraw pursuant to Section 6.2 hereof and the Threshold Amount; (ii) Prior to commencement of construction of such Material Alteration or Material Expansion, Borrower shall deliver to Lender a schedule (with the concurrence of the Independent Architect) setting forth the projected stages of completion of such Alteration or Expansion and the corresponding amounts expected to be due and payable by or on behalf of Borrower in connection with such completion, such schedule to be updated quarterly by Borrower (and with the concurrence of the Independent Architect) during the performance of such Alteration or Expansion. (iii) Any Eligible Collateral that a Borrower delivers to Lender pursuant hereto (and the proceeds of any such Eligible Collateral) shall be invested (to the extent such Eligible Collateral can be invested) by Lender in Permitted Investments for a period of time consistent with the date on which the Borrower notifies Lender that the Borrower expects to request a release of such Eligible Collateral in accordance with the next succeeding sentence. From time to time as the Alteration or Expansion progresses, the amount of any Eligible Collateral so furnished may, upon the written request of Borrower to Lender, be withdrawn by Borrower and paid or otherwise applied by or returned to Borrower in an amount equal to the amount Borrower would be entitled to so withdraw if Section 6.2.4 were applicable, and any Eligible Collateral so furnished which is a Letter of Credit may be reduced by Borrower in an amount equal to the amount Borrower would be entitled to so reduce if Section 6.2.4 hereof were applicable, subject, in each case, to the satisfaction of the conditions precedent to withdrawal of funds or reduction of the Letter of Credit set forth in Section 6.2.4 hereof. In connection with the above-described quarterly update of the projected stages of completion of the Material Alteration or Material Expansion (as concurred with by an Independent Architect), Borrower shall increase (or be permitted to decrease, as applicable) the Eligible Collateral then deposited with Lender as necessary to comply with Section 10.2(h)(i) hereof. (iv) At any time after Final Completion of such Material Alterations or Material Expansions, the whole balance of any Cash deposited with Lender pursuant to Section 10.2(h) hereof then remaining on deposit may be withdrawn by Borrower and shall be paid by Lender to Borrower, and any Eligible Collateral so deposited shall, to the extent it has not been called upon, reduced or theretofore released, be released by Lender to Borrower, within ten (10) days after receipt by Lender of an application for such withdrawal and/or release together with an Officer’s Certificate, and as to the following clauses (A) and (B) of this clause also a certificate of the Independent Architect, setting forth in substance as follows: (A) that such Material Alteration(s) or Material Expansion(s) has been completed in all material respects in accordance with any plans and specifications therefor previously filed with Lender under Section 10.2(c) hereof; (B) that to the knowledge of the certifying Person, (x) such Material Alteration(s) or Material Expansion(s) has been completed in compliance with all Legal Requirements, and (y) to the extent required for the legal use or occupancy of the portion of the Property affected by such Alteration(s) or Expansion(s), the applicable Borrower has obtained a temporary or permanent certificate of occupancy (or similar certificate) or, if no such certificate is required, a statement to that effect; (C) that to the knowledge of the certifying Person, all amounts that a Borrower is or may become liable to pay in respect of such Material Alteration(s) or Material Expansion(s) through the date of the certification have been paid in full or adequately provided for and, to the extent that such are customary and reasonably obtainable by prudent property owners in the area where the applicable Property is located, that Lien waivers have been obtained from the general contractor and subcontractors performing such Alteration(s) or Expansion(s) or at its sole cost and expense, Borrower shall cause a nationally recognized title insurance company to deliver to Lender an endorsement to the Title Policy, updating such policy and insuring over such Liens without further exceptions to such policy other than Permitted Encumbrances, or shall, at its sole cost and expense, cause a reputable title insurance company to deliver a lender’s title insurance policy, in such form, in such amounts and with such endorsements as the Title Policy, which policy shall be dated the date of completion of the Material Alteration and shall contain no exceptions other than Permitted Encumbrances; provided, however, that if, for any reason, Borrower is unable to deliver the certification required by this clause (C) with respect to any costs or expenses relating to the Alteration(s) or Expansion(s), then, assuming Borrower is able to satisfy each of the other requirements set forth in clauses (A) and (B) above, Borrower shall be entitled to the release of the difference between the whole balance of such Eligible Collateral and the total of all costs and expenses to which Borrower is unable to certify; and (D) that to the knowledge of the certifying Person, no Event of Default has occurred and is continuing.

Appears in 2 contracts

Samples: Loan and Security Agreement (Strategic Hotels & Resorts, Inc), Loan and Security Agreement (Strategic Hotels & Resorts, Inc)

Appears in 2 contracts

Samples: Loan and Security Agreement (Strategic Hotels & Resorts, Inc), Loan and Security Agreement (Strategic Hotels & Resorts, Inc)

Alterations and Expansions. Other than the Common Area Renovation Work, Borrower ~~shall~~ will not perform or undertake or consent to the performance or undertaking of (including, without limitation, the approval of any budget with respect to the Property which includes) any Alteration or Expansion, except in accordance with the following terms and conditions: ~~(a)~~ 7.1.1 Borrower shall have obtained Lender’s prior written consent to any Material Alteration or Material Expansion. The Alteration or Expansion shall be undertaken in accordance with the applicable provisions of this Agreement, the other Loan Documents, the ~~Leases~~ Property Management Agreement, if any, the License Agreement, the Operating Agreements and the Leases, and all Legal Requirements. ~~(b)~~ 7.1.2 No Event of Default shall have occurred and be continuing or shall occur as a result of such action. ~~(c)~~ 7.1.3 A Material Alteration or Material Expansion, to the extent architects are customarily used for alterations or expansions of those types, but including any structural change to any of the Property or the Improvements, shall be conducted under the supervision of an Independent Architect and shall not be undertaken until ~~ten (10) Business Days after there shall have been filed with Lender, for information purposes only and not for approval by Lender,~~ detailed plans and specifications and cost estimates therefor, shall have been prepared and delivered to Lender, and approved in writing by such Independent ~~Architect~~Architect and Lender in its reasonable discretion. ~~Such~~ Lender shall have a period of ten (10) Business Days following receipt of such plans and specifications and cost estimates to notify Borrower of its approval or disapproval of same, or its need for additional information in order complete its review. If Lender disapproves such plans and specifications and cost estimates or requests additional information, Lender shall have a period of seven (7) Business Days following its receipt of revised plans and specifications and cost estimates or the additional information in which to notify Borrower of its approval or disapproval of same. Following Lender’s approval of any such plans and specifications, they may be revised at any time and from time to time, provided that revisions of such plans and specifications shall be ~~filed with Lender~~delivered to Lender for its prior approval. Lender shall also have approved (in its reasonable discretion) the general construction contracts and Major Subcontracts prior to the commencement of any such Material Alteration or Material Expansion, ~~for information purposes only~~as applicable. ~~(d)~~ 7.1.4 The Alteration or Expansion may not in and of itself, either during the Alteration or Expansion or upon completion, be reasonably expected to have a Material Adverse Effect with respect to the ~~Property~~Property or adversely affect the annual Net Operating Income, taking into account the required escrows (or completion bond) provided under Section 7.1.8(a) below; provided that if, as reasonably determined by the Lender, such Alteration or Expansion would adversely affect the annual Net Operating Income, then in order to proceed with the Alteration or Expansion the Borrower shall deliver to Lender Eligible Collateral in the total amount of the estimated reduction in Net Operating Income resulting from the Alteration or Expansion as additional security for the Debt, which Eligible Collateral shall be returned to Borrower after completion of the Alteration or Expansion if the reduction in Net Operating Income has been restored and no Event of Default has occurred and is continuing. ~~(e)~~ 7.1.5 All work done in connection with any Alteration or Expansion shall be performed with due diligence to Final Completion in a good and workmanlike manner, all materials used in connection with any Alteration or Expansion shall be not less than the standard of quality of the materials generally used at the Property as of the date hereof (or, if greater, the ~~then-~~then current customary quality in the ~~sub-market~~ submarket in which the Property is located) and all work shall be performed and all materials used in accordance with all applicable Legal Requirements and Insurance Requirements. ~~(f)~~ 7.1.6 The cost of any Alteration or Expansion shall be promptly and fully paid for by Borrower, subject to the next succeeding sentence. No payment made prior to the Final Completion ~~(excluding punch-list items)~~ of an Alteration or Expansion or Restoration to any contractor, subcontractor, materialman, supplier, engineer, architect, project manager or other Person who renders services or furnishes materials in connection with such Alteration shall exceed ninety percent (90%) of the aggregate value of the work performed by such Person from time to time and materials furnished and incorporated into the Improvements. (g) All work performed in connection with the cure of the Deferred Maintenance Conditions shall be performed in accordance with the terms and conditions set forth in clauses (a), (c), (e) and (f) of this Section 10.2. (h) With respect to any Material Alteration or Material Expansion: (i) Borrower shall have delivered to Lender Eligible Collateral in an amount equal to at least the total estimated remaining unpaid costs of such Material Alteration or Material Expansion which is in excess of the Threshold Amount, which Eligible Collateral shall be held by Lender as security for the Indebtedness and released to Borrower as such work progresses in accordance with Section 10.2(h)(iii); provided, however, in the event that any Material Alteration or Material Expansion shall be made in conjunction with any Restoration with respect to which Borrower shall be entitled to use or apply Proceeds pursuant to Section 6.2 hereof (including any Proceeds remaining after completion of such Restoration), the amount of the Eligible Collateral to be furnished pursuant hereto need not exceed the aggregate cost of such Restoration and such Material Alteration or Material Expansion (in either case, as estimated by the Independent Architect) less the sum of the amount of any Proceeds which the Borrower is entitled to withdraw pursuant to Section 6.2 hereof and the Threshold Amount; (ii) Prior to commencement of construction of such Material Alteration or Material Expansion, Borrower shall deliver to Lender a schedule (with the concurrence of the Independent Architect) setting forth the projected stages of completion of such Alteration or Expansion and the corresponding amounts expected to be due and payable by or on behalf of Borrower in connection with such completion, such schedule to be updated quarterly by Borrower (and with the concurrence of the Independent Architect) during the performance of such Alteration or Expansion. (iii) Any Eligible Collateral that a Borrower delivers to Lender pursuant hereto (and the proceeds of any such Eligible Collateral) shall be invested (to the extent such Eligible Collateral can be invested) by Lender in Permitted Investments for a period of time consistent with the date on which the Borrower notifies Lender that the Borrower expects to request a release of such Eligible Collateral in accordance with the next succeeding sentence. From time to time as the Alteration or Expansion progresses, the amount of any Eligible Collateral so furnished may, upon the written request of Borrower to Lender, be withdrawn by Borrower and paid or otherwise applied by or returned to Borrower in an amount equal to the amount Borrower would be entitled to so withdraw if Section 6.2.4 were applicable, and any Eligible Collateral so furnished which is a Letter of Credit may be reduced by Borrower in an amount equal to the amount Borrower would be entitled to so reduce if Section 6.2.4 hereof were applicable, subject, in each case, to the satisfaction of the conditions precedent to withdrawal of funds or reduction of the Letter of Credit set forth in Section 6.2.4 hereof. In connection with the above-described quarterly update of the projected stages of completion of the Material Alteration or Material Expansion (as concurred with by an Independent Architect), Borrower shall increase (or be permitted to decrease, as applicable) the Eligible Collateral then deposited with Lender as necessary to comply with Section 10.2(h)(i) hereof. (iv) At any time after Final Completion of such Material Alterations or Material Expansions, the whole balance of any Cash deposited with Lender pursuant to Section 10.2(h) hereof then remaining on deposit may be withdrawn by Borrower and shall be paid by Lender to Borrower, and any Eligible Collateral so deposited shall, to the extent it has not been called upon, reduced or theretofore released, be released by Lender to Borrower, within ten (10) days after receipt by Lender of an application for such withdrawal and/or release together with an Officer’s Certificate, and as to the following clauses (A) and (B) of this clause also a certificate of the Independent Architect, setting forth in substance as follows: (A) that such Material Alteration(s) or Material Expansion(s) has been completed in all material respects in accordance with any plans and specifications therefor previously filed with Lender under Section 10.2(c) hereof; (B) that to the knowledge of the certifying Person, (x) such Material Alteration(s) or Material Expansion(s) has been completed in compliance with all Legal Requirements, and (y) to the extent required for the legal use or occupancy of the portion of the Property affected by such Alteration(s) or Expansion(s), the applicable Borrower has obtained a temporary or permanent certificate of occupancy (or similar certificate) or, if no such certificate is required, a statement to that effect; (C) that to the knowledge of the certifying Person, all amounts that a Borrower is or may become liable to pay in respect of such Material Alteration(s) or Material Expansion(s) through the date of the certification have been paid in full or adequately provided for and, to the extent that such are customary and reasonably obtainable by prudent property owners in the area where the applicable Property is located, that Lien waivers have been obtained from the general contractor and subcontractors performing such Alteration(s) or Expansion(s) or at its sole cost and expense, Borrower shall cause a nationally recognized title insurance company to deliver to Lender an endorsement to the Title Policy, updating such policy and insuring over such Liens without further exceptions to such policy other than Permitted Encumbrances, or shall, at its sole cost and expense, cause a reputable title insurance company to deliver a lender’s title insurance policy, in such form, in such amounts and with such endorsements as the Title Policy, which policy shall be dated the date of completion of the Material Alteration and shall contain no exceptions other than Permitted Encumbrances; provided, however, that if, for any reason, Borrower is unable to deliver the certification required by this clause (C) with respect to any costs or expenses relating to the Alteration(s) or Expansion(s), then, assuming Borrower is able to satisfy each of the other requirements set forth in clauses (A) and (B) above, Borrower shall be entitled to the release of the difference between the whole balance of such Eligible Collateral and the total of all costs and expenses to which Borrower is unable to certify; and (D) that to the knowledge of the certifying Person, no Event of Default has occurred and is continuing.

Appears in 1 contract

Samples: Loan Agreement (Colony Resorts LVH Acquisitions LLC)

Alterations and Expansions. No Borrower ~~shall not~~ or Operating Lessee will perform or undertake or consent to the performance or undertaking of (including, without limitation, the approval of any budget with respect to a Property which includes) any Alteration or Expansion, except in accordance with the following terms and conditions: (a) The Alteration or Expansion shall be undertaken in accordance with the applicable provisions of this Agreement, the other Loan Documents, the ~~Leases~~ Property Management Agreements, the Operating Agreements and the Leases, and all Legal Requirements. (b) No Event of Default shall have occurred and be continuing or shall occur as a result of such action. (c) A Material Alteration or Material Expansion, to the extent architects are customarily used for alterations or expansions of those types, but including any structural change to any of the ~~Property~~ Properties or the Improvements, shall be conducted under the supervision of an Independent Architect and shall not be undertaken until ten (10) Business Days after there shall have been filed with Lender, for information purposes only and not for approval by Lender, detailed plans and specifications and cost estimates therefor, prepared and approved in writing by such Independent Architect. Such plans and specifications may be revised at any time and from time to time, provided that revisions of such plans and specifications shall be filed with Lender, for information purposes only. (d) The Alteration or Expansion may not in and of itself, either during the Alteration or Expansion or upon completion, be reasonably expected to have a Material Adverse Effect with respect to a Property. In addition, if the ~~Property~~Aggregate DSCR can reasonably be expected to be less than 1.50:1.00 during the scheduled period of any Material Alteration or Material Expansion, taking into account the required escrows (or completion bond) provided under Section 7.1(h)(i) below; then in order to proceed with such Material Alteration or Material Expansion the Borrowers shall deliver to Lender, as additional security for the Debt, Eligible Collateral in the total amount of the estimated reduction in Net Operating Income resulting from the Alteration or Expansion as additional security for the Debt. On each Payment Date during the period in which such Material Alteration or Material Expansion is being performed, Lender shall release a portion of such Eligible Collateral to Borrower in an amount equal to the estimated reduction in the Net Operating Income resulting from the Alteration or Expansion for the month in which the Payment Date occurs. Any remaining Eligible Collateral shall be returned to Borrowers after completion of such Material Alteration or Material Expansion if the reduction in Net Operating Income has been restored and no Event of Default has occurred and is continuing. (e) All work done in connection with any Alteration or Expansion shall be performed with due diligence to Final Completion in a good and workmanlike manner, all materials used in connection with any Alteration or Expansion shall be not less than the standard of quality of the materials generally used at the applicable Property as of the date hereof (or, if greater, the then-current customary quality in the ~~sub-market~~ submarket in which ~~the~~ such Property is located) and all work shall be performed and all materials used in accordance with all applicable Legal Requirements and Insurance Requirements. (f) The cost of any Alteration or Expansion shall be promptly and fully paid for by ~~Borrower~~Borrowers, subject to the next succeeding sentence. No payment made prior to the Final Completion ~~(excluding punch-list items)~~ of an Alteration or Expansion or Restoration to any contractor, subcontractor, materialman, supplier, engineer, architect, project manager or other Person who renders services or furnishes materials in connection with such Alteration shall exceed ninety percent (90%) (other than with respect to FF&E for which Borrower may make payments in full prior to Final Completion if it has received delivery of such items and otherwise has complied with the terms of Section 9.2.16) of the aggregate value of the work performed by such Person from time to time and materials furnished and incorporated into the Improvements. (g) All work performed in connection with the (i) cure of the Deferred Maintenance Conditions and (ii) remediation of the Environmental Conditions shall be performed in accordance with the terms and conditions set forth in clauses (a), (c), (e) and (f) of this Section ~~10.2~~7. 1. Subject to Section 7.1(f) above, from time to time as the cure or remediation of any particular Deferred Maintenance Condition or Environmental Condition progresses, Lender shall, subject to and upon the satisfaction of the terms and conditions set forth in Section 9.2.2 herein, disburse to Borrowers from the Deferred Maintenance and Environmental Conditions Reserve Account, amounts incurred by Borrowers in connection with the cure or remediation of the Deferred Maintenance Condition or Environmental Condition in question. (h) With respect to any Material Alteration or Material Expansion: (i) ~~Borrower~~ Borrowers shall have delivered to Lender Eligible Collateral in an amount equal to at least the total estimated remaining unpaid costs of such Material Alteration or Material Expansion which ~~is in excess of the Threshold Amount, which~~ Eligible Collateral shall be held by Lender as security for the ~~Indebtedness~~ Debt and released to the applicable Borrower as such work progresses in accordance with Section ~~10.2(h)(iii)~~7.1(h)(iii) hereof; provided, however, in the event that any Material Alteration or Material Expansion shall be made in conjunction with any Restoration with respect to which a Borrower shall be entitled to ~~use or apply~~ withdraw Proceeds pursuant to Section ~~6.2~~ 8.1.2(b) hereof (including any Proceeds remaining after completion of such Restoration), the amount of the Eligible Collateral to be furnished pursuant hereto need not exceed the aggregate cost of such Restoration and such Material Alteration or Material Expansion (in either case, as estimated by the Independent Architect) less the sum of the amount of any Proceeds which ~~the~~ any Borrower is entitled to withdraw pursuant to Section ~~6.2 hereof and the Threshold Amount~~8.1 hereof; (ii) Prior to commencement of construction of such Material Alteration or Material Expansion, ~~Borrower~~ Borrowers shall deliver to Lender a schedule (with the concurrence of the Independent Architect) setting forth the projected stages of completion of such Alteration or Expansion and the corresponding amounts expected to be due and payable by or on behalf of ~~Borrower~~ Borrowers in connection with such completion, such schedule to be updated quarterly by ~~Borrower~~ Borrowers (and with the concurrence of the Independent Architect) during the performance of such Alteration or Expansion. (iii) Any Eligible Collateral that a Borrower delivers to Lender pursuant hereto (and the proceeds of any such Eligible Collateral) shall be invested (to the extent such Eligible Collateral can be invested) by Lender in Permitted Investments for a period of time consistent with the date on which ~~the~~ such Borrower notifies Lender that ~~the~~ such Borrower expects to request a release of such Eligible Collateral in accordance with the next succeeding sentence. From time to time as the Alteration or Expansion progresses, the amount of any Eligible Collateral so furnished may, upon the written request of any Borrower to Lender, be withdrawn by ~~Borrower~~ Borrowers and paid or otherwise applied by or returned to ~~Borrower~~ Borrowers in an amount equal to the amount ~~Borrower~~ Borrowers would be entitled to so withdraw if Section ~~6.2.4~~ 8.1.2(e) hereof were applicable, and any Eligible Collateral so furnished which is a ~~Letter of~~ Credit Facility may be reduced by ~~Borrower~~ Borrowers in an amount equal to the amount ~~Borrower~~ Borrowers would be entitled to so reduce if Section ~~6.2.4~~ 8.1.2(e) hereof were applicable, subject, in each case, to the satisfaction of the conditions precedent to withdrawal of funds or reduction of the ~~Letter of~~ Credit Facility set forth in Section ~~6.2.4~~ 8.1.2(e) hereof, provided however that, notwithstanding the terms of Section 8.1.2(e), instead of reimbursing Borrowers for amounts already paid in respect of such Alteration or Expansion, Eligible Collateral shall be disbursed to Borrower or, at Lender’s election, the applicable contractor upon presentation to Lender of a draw request together with copies of invoices for the amounts to be withdrawn. In connection with the above-described quarterly update of the projected stages of completion of the Material Alteration or Material Expansion (as concurred with by an Independent Architect), ~~Borrower~~ Borrowers shall increase (or be permitted to decrease, as applicable) the Eligible Collateral then deposited with Lender as necessary to comply with Section ~~10.2(h)(i~~7.1(h)(i) hereof. (iv) At any time after Final Completion of such ~~Material~~ Alterations or ~~Material~~ Expansions, the whole balance of any Cash deposited with Lender pursuant to Section ~~10.2(h~~7.1(h) hereof then remaining on deposit may be withdrawn by ~~Borrower~~ Borrowers and shall be paid by Lender to ~~Borrower~~Borrowers, and any Eligible Collateral so deposited shall, to the extent it has not been called upon, reduced or theretofore released, be released by Lender to ~~Borrower~~Borrowers, within ten (10) days after receipt by Lender of an application for such withdrawal and/or release together with an Officer’s Certificate, and as to the following clauses (A) and (B) of this clause also a certificate of the Independent Architect, setting forth in substance as follows: (A) that such ~~Material~~ Alteration(s) or ~~Material~~ Expansion(s) has been completed in all material respects in accordance with any plans and specifications therefor previously filed with Lender under Section ~~10.2(c~~7.1(c) hereof; (B) that to the knowledge of the certifying Person, (x) such ~~Material~~ Alteration(s) or ~~Material~~ Expansion(s) has been completed in compliance with all Legal Requirements, and (y) to the extent required for the legal use or occupancy of the portion of the Property affected by such Alteration(s) or Expansion(s), the applicable Borrower has obtained a temporary or permanent certificate of occupancy (or similar certificate) or, if no such certificate is required, a statement to that effect; (C) that to the knowledge of the certifying Person, all amounts that a Borrower is or may become liable to pay in respect of such ~~Material~~ Alteration(s) or ~~Material~~ Expansion(s) through the date of the certification have been paid in full or adequately provided for and, to the extent that such are customary and reasonably obtainable by prudent property owners in the area where the applicable Property is located, that Lien waivers have been obtained from the general contractor and subcontractors performing such Alteration(s) or Expansion(s) or at its sole cost and expense, ~~Borrower~~ Borrowers shall cause a nationally recognized title insurance company to deliver to Lender an endorsement to the Qualified Title Policy, updating such policy and insuring over such Liens without further exceptions to such policy other than Permitted Encumbrances, or shall, at its sole cost and expense, cause a reputable title insurance company to deliver a lender’s title insurance policy, in such form, in such amounts and with such endorsements as the Qualified Title Policy, which policy shall be dated the date of completion of the Material Alteration and shall contain no exceptions other than Permitted Encumbrances; provided, however, that if, for any reason, ~~Borrower is~~ Borrowers are unable to deliver the certification required by this clause (C) with respect to any costs or expenses relating to the Alteration(s) or Expansion(s), then, assuming ~~Borrower is~~ Borrowers are able to satisfy each of the other requirements set forth in clauses (A) and (B) above, ~~Borrower~~ Borrowers shall be entitled to the release of the difference between the whole balance of such Eligible Collateral and the total of all costs and expenses to which ~~Borrower is~~ Borrowers are unable to certify; and (D) that to the knowledge of the certifying Person, no Event of Default has occurred and is continuing.

Appears in 1 contract

Samples: Loan Agreement (Strategic Hotel Capital Inc)

Alterations and Expansions. ~~Borrower~~ No Obligor shall ~~not~~ perform or undertake ~~or consent to the performance or undertaking of~~ any Alteration or Expansion, except in accordance with the following terms and conditions: (a) The Alteration or Expansion shall be undertaken in accordance with the applicable provisions of this Agreement, the other Loan Documents, the ~~Leases~~ Operating Agreements and the Leases, and all Legal Requirements. (b) No Event of Default shall have occurred and be continuing or shall occur as a result of such action. (c) A Material Alteration or Material Expansion shall not be commenced unless Obligors have obtained the prior approval of Lender (which approval shall not be 116 118 unreasonably withheld or delayed). Any request for approval of a Material Alteration or Material Expansion shall be in writing and accompanied by a reasonably detailed description of such Material Alteration or Material Expansion~~, to the extent architects are customarily used for alterations~~ . (d) A Material Alteration or ~~expansions of those types, but including any structural change to any of the Property or the Improvements,~~ Material Expansion shall be conducted under the supervision of an Independent Architect or Engineer and shall not be ~~undertaken until ten~~ commenced by or on behalf of any Obligor at any Property unless (10i) ~~Business Days after there~~ the applicable Obligor shall have ~~been filed with Lender, for information purposes only and not for approval by Lender,~~ caused to be delivered to Lender detailed plans and specifications and cost estimates therefor, which plans, specifications and estimates shall have been prepared and approved in writing by ~~such~~ the Independent Architect~~. Such plans~~ , and (ii) Lender shall have approved such plans, specifications ~~may be revised at any time~~ and ~~from time to time~~estimates in writing, ~~provided that revisions of such plans and specifications~~ which approval (A) shall be ~~filed~~ deemed given with respect to cost estimates for each Material Alteration and Material Expansion described in the Approved Budget, and (B) shall otherwise not be unreasonably withheld or delayed by Lender~~, for information purposes only~~. (e) Any approval of Lender required in clause (c) or (d) ~~The~~ above accompanied by the items referred to in clause (c) or (d) above shall be deemed given if Lender shall not have notified the relevant Obligor in writing of its disapproval within fifteen (15) Business Days after such Obligor has given Lender written notice that at least fifteen (15) Business Days have elapsed since such first written request was given and which is captioned on the first page of such request with the following legend in bold face type: "WARNING: FAILURE TO RESPOND TO THIS COMMUNICATION WITHIN FIFTEEN (15) BUSINESS DAYS OF THE DATE OF RECEIPT OF THIS NOTICE WILL BE DEEMED CONSENT TO THE ACTIONS FOR WHICH YOUR CONSENT IS REQUESTED HEREIN." (f) Other than in connection with any Restoration, the Alteration or Expansion may not in and of itself, either during the Alteration or Expansion or upon completion, be adversely affect the fair market value of the relevant Property or the annual Net Operating Income, taking into account the required escrows (or completion bond) provided under Section 7.1(j)(i) below; provided that if, as reasonably ~~expected~~ determined by the Lender, such Alteration or Expansion would adversely affect the annual Net Operating Income, then in order to ~~have~~ proceed with the Alteration or Expansion, the Lender may, in its sole discretion, as a ~~Material Adverse Effect with respect~~ condition to granting the consent to the ~~Property~~Alteration or Expansion, require the Obligor to deliver to Lender Eligible Collateral in the total amount of the estimated reduction in Net Operating Income resulting from the Alteration or Expansion as additional security for the Debt, which Eligible Collateral shall be returned to Obligor after completion of the Alteration or Expansion if the reduction in Net Operating Income has been restored and no Event of Default has occurred and is continuing. (eg) All work done in connection with any Alteration or Expansion shall be performed with due diligence to Final Completion in a good and workmanlike manner, all materials used in connection with any Alteration or Expansion shall be not less than the standard of quality of the materials generally used at ~~the~~ such Property as of the date hereof (or, if greater, the then-current customary quality in the ~~sub-market~~ submarket in which ~~the~~ such Property is located) and all work shall be performed and all materials used in accordance with all applicable Legal Requirements and Insurance Requirements. . 117 119 (fh) The cost of any Alteration or Expansion shall be promptly and fully paid for by ~~Borrower~~Obligor, subject to the next succeeding sentence. No payment made ~~prior to the Final Completion (excluding punch-list items) of an Alteration or Expansion or Restoration~~ to any contractor, subcontractor, materialman, supplier, engineer, architect, project manager or other Person who renders services or furnishes materials in connection with ~~such Alteration~~ an Alteration, Expansion or Restoration shall exceed ninety percent (90%) of the ~~aggregate~~ first 50% of the value of ~~the~~ such work performed ~~by such Person~~ from time to time and materials furnished and incorporated into the Improvements. (gi) ~~All work performed~~ Other than in connection with any Restoration, the ~~cure of the Deferred Maintenance Conditions shall be performed in accordance with the terms and conditions set forth in clauses (a)~~Alteration or Expansion will not, (c)i) under any then existing Lease with a Major Tenant, ~~(e) and (f)~~ entitle one or more Major Tenants to terminate their respective Leases or any operating covenant under any Material Agreements or abatx xxxt or otherwise give rise to any other rights of ~~this Section 10.2~~lessees or such other parties that would have a Material Adverse Effect on the value of such Property. (hj) With respect to any Material Alteration or Material Expansion: (i) ~~Borrower~~ Obligor shall have delivered to Lender Eligible Collateral in an amount equal to at least the total estimated remaining unpaid costs of such Material Alteration or Material Expansion which ~~is in excess of the Threshold Amount, which~~ Eligible Collateral shall be held by Lender as security for the ~~Indebtedness~~ Debt and released to ~~Borrower~~ the applicable Obligor as such work progresses in accordance with Section ~~10.2(h)(iii)~~7.1(j)(iii) hereof; provided, however, in the event that any Material Alteration or Material Expansion shall be made in conjunction with any Restoration with respect to which ~~Borrower~~ Obligor shall be entitled to ~~use or apply~~ withdraw Proceeds pursuant to Section ~~6.2~~ 8.1.2(b) hereof (including any Proceeds remaining after completion of such Restoration), the amount of the Eligible Collateral to be furnished pursuant hereto need not exceed the aggregate cost of such Restoration and such Material Alteration or Material Expansion (in either case, as estimated by the Independent Architect) less the sum of the amount of any Proceeds which ~~the Borrower~~ Obligor is entitled to withdraw pursuant to Section ~~6.2 hereof and the Threshold Amount~~8.1 hereof; (ii) Prior to commencement of construction of such Material Alteration or Material Expansion, ~~Borrower~~ Obligor shall deliver to Lender a schedule (~~with the concurrence of~~ which shall be concurred in by the Independent Architect) setting forth the projected stages of completion of such Alteration or Expansion and the corresponding amounts expected to be due and payable by or on behalf of ~~Borrower~~ Obligor in connection with such completion, such schedule to be updated quarterly by ~~Borrower~~ Obligor (and concurred with ~~the concurrence of the~~ by an Independent Architect) during the performance of such Alteration or Expansion. (iii) Any Eligible Collateral that ~~a Borrower~~ Obligor delivers to Lender pursuant hereto (and the proceeds of any such Eligible Collateral) shall be invested (to the extent such Eligible Collateral can be invested) by Lender as directed by Obligor in Permitted Investments for a period of time consistent with the date on which the Borrower notifies Lender that the Borrower expects to request a release of such Eligible Collateral in accordance with the next succeeding sentence. From time to time as the Alteration or Expansion progresses, the amount of any Eligible Collateral so furnished may, upon the written request of Borrower to Lender, be withdrawn by Borrower and paid or otherwise applied by or returned to Borrower in an amount equal to the amount Borrower would be entitled to so withdraw if Section 6.2.4 were applicable, and any Eligible Collateral so furnished which is a Letter of Credit may be reduced by Borrower in an amount equal to the amount Borrower would be entitled to so reduce if Section 6.2.4 hereof were applicable, subject, in each case, to the satisfaction of the conditions precedent to withdrawal of funds or reduction of the Letter of Credit set forth in Section 6.2.4 hereof. In connection with the above-described quarterly update of the projected stages of completion of the Material Alteration or Material Expansion (as concurred with by an Independent Architect), Borrower shall increase (or be permitted to decrease, as applicable) the Eligible Collateral then deposited with Lender as necessary to comply with Section 10.2(h)(i) hereof. (iv) At any time after Final Completion of such Material Alterations or Material Expansions, the whole balance of any Cash deposited with Lender pursuant to Section 10.2(h) hereof then remaining on deposit may be withdrawn by Borrower and shall be paid by Lender to Borrower, and any Eligible Collateral so deposited shall, to the extent it has not been called upon, reduced or theretofore released, be released by Lender to Borrower, within ten (10) days after receipt by Lender of an application for such withdrawal and/or release together with an Officer’s Certificate, and as to the following clauses (A) and (B) of this clause also a certificate of the Independent Architect, setting forth in substance as follows: (A) that such Material Alteration(s) or Material Expansion(s) has been completed in all material respects in accordance with any plans and specifications therefor previously filed with Lender under Section 10.2(c) hereof; (B) that to the knowledge of the certifying Person, (x) such Material Alteration(s) or Material Expansion(s) has been completed in compliance with all Legal Requirements, and (y) to the extent required for the legal use or occupancy of the portion of the Property affected by such Alteration(s) or Expansion(s), the applicable Borrower has obtained a temporary or permanent certificate of occupancy (or similar certificate) or, if no such certificate is required, a statement to that effect; (C) that to the knowledge of the certifying Person, all amounts that a Borrower is or may become liable to pay in respect of such Material Alteration(s) or Material Expansion(s) through the date of the certification have been paid in full or adequately provided for and, to the extent that such are customary and reasonably obtainable by prudent property owners in the area where the applicable Property is located, that Lien waivers have been obtained from the general contractor and subcontractors performing such Alteration(s) or Expansion(s) or at its sole cost and expense, Borrower shall cause a nationally recognized title insurance company to deliver to Lender an endorsement to the Title Policy, updating such policy and insuring over such Liens without further exceptions to such policy other than Permitted Encumbrances, or shall, at its sole cost and expense, cause a reputable title insurance company to deliver a lender’s title insurance policy, in such form, in such amounts and with such endorsements as the Title Policy, which policy shall be dated the date of completion of the Material Alteration and shall contain no exceptions other than Permitted Encumbrances; provided, however, that if, for any reason, Borrower is unable to deliver the certification required by this clause (C) with respect to any costs or expenses relating to the Alteration(s) or Expansion(s), then, assuming Borrower is able to satisfy each of the other requirements set forth in clauses (A) and (B) above, Borrower shall be entitled to the release of the difference between the whole balance of such Eligible Collateral and the total of all costs and expenses to which Borrower is unable to certify; and (D) that to the knowledge of the certifying Person, no Event of Default has occurred and is continuing.time

Appears in 1 contract

Samples: Loan Agreement (Starwood Hotel & Resorts Worldwide Inc)

Alterations and Expansions. ~~Borrower shall not perform~~ Make or ~~undertake~~ permit any demolition, -------------------------- alteration, installation or ~~consent~~ improvement (including in connection with its compliance with any Requirement of Law) to any MOB Property or any part thereof (an "Alteration") or expand or reduce any MOB Property or the ~~performance or undertaking of any Alteration or~~ Improvements ---------- thereon (an "Expansion"), except in accordance with the following terms and --------- conditions: (a) ~~The~~ such Alteration or Expansion shall be undertaken in accordance with the applicable provisions of this Agreement, the other Loan Documents, the Leases and ~~all Legal Requirements.~~Requirements of Law; (b) No no Default or Event of Default shall have occurred and be continuing (except in the case of an Alteration that is required to cure a Default or Event of Default or to comply with obligations under Leases) or shall occur as a result of such action.; (c) A Material Alteration or Material Expansion, to the extent architects are customarily used for alterations or expansions of those types, but including any structural change to any of the Property or the Improvements, shall be conducted under the supervision of an Independent Architect and shall not be undertaken until ten (10) Business Days after there shall have been filed with Lender, for information purposes only and not for approval by Lender, detailed plans and specifications and cost estimates therefor, prepared and approved in writing by such Independent Architect. Such plans and specifications may be revised at any time and from time to time, provided that revisions of such plans and specifications shall be filed with Lender, for information purposes only. (d) The Alteration or Expansion may not in and of itself, either during the Alteration or Expansion or upon completion, be reasonably expected to have a Material Adverse Effect with respect to the Property. (e) All all work done in connection with any Alteration or Expansion shall be performed with due diligence ~~to Final Completion~~ in a good and workmanlike manner, all materials used in connection with any Alteration or Expansion shall be new and not less than the standard of quality ~~of the materials generally used at the Property as of the date hereof (or~~a prudent owner would utilize, ~~if greater, the then-current customary quality in the sub-market in which the Property is located)~~ and all work shall be performed and all materials used in accordance with all applicable ~~Legal~~ Requirements of Law and ~~Insurance Requirements.~~insurance requirements. If at any time during any Alteration or Expansion the applicable Credit Party decides not to complete such Alteration or Expansion, such Credit Party shall obtain the approval of the Agent to such stoppage; (fd) ~~The~~ the cost of any Alteration or Expansion shall be promptly and fully paid for by ~~Borrower,~~ the applicable Credit Party or the Tenant or subtenant performing the Alteration or Expansion (subject to the ~~next succeeding sentence. No~~ right to contest in accordance with Section 5.6 hereof); (e) the Alteration or Expansion will not entitle any party to a Lease to terminate such Lease or otherwise give rise to any other rights of such parties (such as the right to terminate an operating covenant) that could have a Material Adverse Effect unless, in each case, the Agent consents thereto; (f) with respect to any material Alteration or material Expansion, the applicable Credit Party shall have delivered to the Agent any information related thereto reasonably requested by the Agent and the Agent shall have approved such Alteration or Expansion; and all revisions thereto shall likewise be subject to the approval of the Agent; (g) no payment made prior to the ~~Final Completion (excluding punch-list items)~~ final completion of an such material Alteration or material Expansion ~~or Restoration~~ to any contractor, subcontractor, materialman, supplier, engineer, architect, project manager or other Person who renders services or furnishes materials in connection with such material Alteration or material Expansion shall exceed ~~ninety~~ ninety-five percent (9095%) of the ~~aggregate~~ value of the work performed ~~by such Person~~ from time to time and materials furnished and incorporated into the Improvements. (g) All work performed in connection with the cure of the Deferred Maintenance Conditions shall be performed in accordance with the terms and conditions set forth in clauses (a), (c), (e) and (f) of this Section 10.2.improvements; and (h) ~~With respect to~~ in the case of any ~~Material~~ material Alteration or ~~Material~~ material Expansion: (i) Borrower shall have delivered to Lender Eligible Collateral in an amount equal to at least the total estimated remaining unpaid costs of such Material Alteration or Material Expansion which is in excess of the Threshold Amount, which Eligible Collateral shall be held by Lender as security for the Indebtedness and released to Borrower as such work progresses in accordance with Section 10.2(h)(iii); provided, however, in the event that any Material Alteration or Material Expansion shall be made in conjunction with any Restoration with respect to which Borrower shall be entitled to use or apply Proceeds pursuant to Section 6.2 hereof (including any Proceeds remaining after completion of such Restoration), the amount of the Eligible Collateral to be furnished pursuant hereto need not exceed the aggregate cost of such Restoration and such Material Alteration or Material Expansion (in either case, as estimated by the Independent Architect) less the sum of the amount of any Proceeds which the Borrower is entitled to withdraw pursuant to Section 6.2 hereof and the Threshold Amount; (ii) Prior to commencement of construction of such Material Alteration or Material Expansion, Borrower shall deliver to Lender a schedule (with the concurrence of the Independent Architect) setting forth the projected stages of completion of such Alteration or Expansion and the corresponding amounts expected to be due and payable by or on behalf of Borrower in connection with such completion, such schedule to be updated quarterly by Borrower (and with the concurrence of the Independent Architect) during the performance of such Alteration or Expansion. (iii) Any Eligible Collateral that a Borrower delivers to Lender pursuant hereto (and the proceeds of any such Eligible Collateral) shall be invested (to the extent such Eligible Collateral can be invested) by Lender in Permitted Investments for a period of time consistent with the date on which the Borrower notifies Lender that the Borrower expects to request a release of such Eligible Collateral in accordance with the next succeeding sentence. From time to time as the Alteration or Expansion progresses, the amount of any Eligible Collateral so furnished may, upon the written request of Borrower to Lender, be withdrawn by Borrower and paid or otherwise applied by or returned to Borrower in an amount equal to the amount Borrower would be entitled to so withdraw if Section 6.2.4 were applicable, and any Eligible Collateral so furnished which is a Letter of Credit may be reduced by Borrower in an amount equal to the amount Borrower would be entitled to so reduce if Section 6.2.4 hereof were applicable, subject, in each case, to the satisfaction of the conditions precedent to withdrawal of funds or reduction of the Letter of Credit set forth in Section 6.2.4 hereof. In connection with the above-described quarterly update of the projected stages of completion of the Material Alteration or Material Expansion (as concurred with by an Independent Architect), Borrower shall increase (or be permitted to decrease, as applicable) the Eligible Collateral then deposited with Lender as necessary to comply with Section 10.2(h)(i) hereof. (iv) At any time after Final Completion of such Material Alterations or Material Expansions, the whole balance of any Cash deposited with Lender pursuant to Section 10.2(h) hereof then remaining on deposit may be withdrawn by Borrower and shall be paid by Lender to Borrower, and any Eligible Collateral so deposited shall, to the extent it has not been called upon, reduced or theretofore released, be released by Lender to Borrower, within ten (10) days after receipt by Lender of an application for such withdrawal and/or release together with an Officer’s Certificate, and as to the following clauses (A) and (B) of this clause also a certificate of the Independent Architect, setting forth in substance as follows: (A) that such Material Alteration(s) or Material Expansion(s) has been completed in all material respects in accordance with any plans and specifications therefor previously filed with Lender under Section 10.2(c) hereof; (B) that to the knowledge of the certifying Person, (x) such Material Alteration(s) or Material Expansion(s) has been completed in compliance with all Legal Requirements, and (y) to the extent required for the legal use or occupancy of the portion of the Property affected by such Alteration(s) or Expansion(s), the applicable ~~Borrower has obtained a temporary or permanent certificate of occupancy (or similar certificate) or, if no such certificate is required, a statement to that effect; (C) that~~ Credit Party shall provide evidence satisfactory to the ~~knowledge of the certifying Person~~Agent, ~~all amounts that a Borrower is or may become liable to pay~~ in ~~respect of such Material Alteration(s) or Material Expansion(s) through the date of the certification have been paid in full or adequately provided for and~~its sole discretion, ~~to the extent~~ that such are customary and reasonably obtainable by prudent property owners in the area where the applicable Property is located, that Lien waivers have been obtained from the general contractor and subcontractors performing Credit Party has available to it sufficient funds to complete such ~~Alteration(s)~~ material Alteration or Expansion(s) or at its sole cost and expense, Borrower shall cause a nationally recognized title insurance company to deliver to Lender an endorsement to the Title Policy, updating such policy and insuring over such Liens without further exceptions to such policy other than Permitted Encumbrances, or shall, at its sole cost and expense, cause a reputable title insurance company to deliver a lender’s title insurance policy, in such form, in such amounts and with such endorsements as the Title Policy, which policy shall be dated the date of completion of the Material Alteration and shall contain no exceptions other than Permitted Encumbrances; provided, however, that if, for any reason, Borrower is unable to deliver the certification required by this clause (C) with respect to any costs or expenses relating to the Alteration(s) or Expansion(s), then, assuming Borrower is able to satisfy each of the other requirements set forth in clauses (A) and (B) above, Borrower shall be entitled to the release of the difference between the whole balance of such Eligible Collateral and the total of all costs and expenses to which Borrower is unable to certify; and (D) that to the knowledge of the certifying Person, no Event of Default has occurred and is continuingmaterial Expansion.

Appears in 1 contract

Samples: Credit Agreement (G&l Realty Corp)

Alterations and Expansions. Borrower shall not perform or undertake or consent to the performance or undertaking of any Alteration or Expansion, except in accordance with the following terms and conditions: (a) The Alteration or Expansion shall be undertaken in accordance with the applicable provisions of this Agreement, the other Loan Documents, the Leases and all Legal Requirements. (b) No Event of Default shall have occurred and be continuing or shall occur as a result of such action. (c) A Material Alteration or Material Expansion, to the extent architects are customarily used for alterations or expansions of those types, but including any structural change to any of the Property or the Improvements, shall be conducted under the supervision of an Independent Architect and shall not be undertaken until ten (10) Business Days after there shall have been filed with Lender, for information purposes only and not for approval by Lender, detailed plans and specifications and cost estimates therefor, prepared and approved in writing by such Independent Architect. Such plans and specifications may be revised at any time and from time to time, provided that revisions of such plans and specifications shall be filed with Lender, for information purposes only. (d) The Alteration or Expansion may not in and of itself, either during the Alteration or Expansion or upon completion, be reasonably expected to have a Material Adverse Effect with respect to the ~~Property~~Property or, if a Low DSCR Period then exists, adversely affect the annual Net Operating Income by more than $500,000, taking into account the required escrows (or completion bond) provided under clause (h)(i) below; provided that if, as reasonably determined by the Lender, such Alteration or Expansion would reduce annual Net Operating Income by $500,000 or more and a Low DSCR Period then exists, then in order to proceed with the Alteration or Expansion the Borrower shall deliver to Lender Eligible Collateral in the amount that the projected reduction in Net Operating Income resulting from the Alteration or Expansion exceeds $500,000 as additional security for the Indebtedness, which Eligible Collateral shall be returned to Borrower after evidence of completion of the applicable Alteration or Expansion and no Event of Default has occurred and is continuing. (e) All work done in connection with any Alteration or Expansion shall be performed with due diligence to Final Completion in a good and workmanlike manner, all materials used in connection with any Alteration or Expansion shall be not less than the standard of quality of the materials generally used at the Property as of the date hereof (or, if greater, the then-current customary quality in the sub-market in which the Property is located) and all work shall be performed and all materials used in accordance with all applicable Legal Requirements and Insurance Requirements. (f) The cost of any Alteration or Expansion shall be promptly and fully paid for by Borrower, subject to the next succeeding sentence. No payment made prior to the Final Completion (excluding punch-list items) of an Alteration or Expansion or Restoration to any contractor, subcontractor, materialman, supplier, engineer, architect, project manager or other Person who renders services or furnishes materials in connection with such Alteration shall exceed ninety percent (90%) of the aggregate value of the work performed by such Person from time to time and materials furnished and incorporated into the Improvements. (g) All work performed in connection with the cure of the Deferred Maintenance Conditions shall be performed in accordance with the terms and conditions set forth in clauses (a), (c), (e) and (f) of this Section 10.2Intentionally omitted. (h) With respect to any Material Alteration or Material Expansion: (i) Borrower shall have delivered to Lender Eligible Collateral in an amount equal to at least the total estimated remaining unpaid costs of such Material Alteration or Material Expansion which is in excess of the Threshold Amount, which Eligible Collateral shall be held by Lender as security for the Indebtedness and released to Borrower as such work progresses in accordance with Section 10.2(h)(iii); provided, however, in the event that any Material Alteration or Material Expansion shall be made in conjunction with any Restoration with respect to which Borrower shall be entitled to ~~use or apply~~ withdraw Proceeds pursuant to Section 6.2 hereof (including any Proceeds remaining after completion of such Restoration), the amount of the Eligible Collateral to be furnished pursuant hereto need not exceed the aggregate cost of such Restoration and such Material Alteration or Material Expansion (in either case, as estimated by the Independent Architect) less the sum of the amount of any Proceeds which the Borrower is entitled to withdraw pursuant to Section 6.2 hereof and the Threshold Amount; (ii) Prior to commencement of construction of such Material Alteration or Material Expansion, Borrower shall deliver to Lender a schedule (with the concurrence of the Independent Architect) setting forth the projected stages of completion of such Alteration or Expansion and the corresponding amounts expected to be due and payable by or on behalf of Borrower in connection with such completion, such schedule to be updated quarterly by Borrower (and with the concurrence of the Independent Architect) during the performance of such Alteration or Expansion. (iii) Any Eligible Collateral that a Borrower delivers to Lender pursuant hereto (and the proceeds of any such Eligible Collateral) shall be invested (to the extent such Eligible Collateral can be invested) by Lender in Permitted Investments for a period of time consistent with the date on which the Borrower notifies Lender that the Borrower expects to request a release of such Eligible Collateral in accordance with the next succeeding sentence. From time to time as the Alteration or Expansion progresses, the amount of any Eligible Collateral so furnished may, upon the written request of Borrower to Lender, be withdrawn by Borrower and paid or otherwise applied by or returned to Borrower in an amount equal to the amount Borrower would be entitled to so withdraw if Section 6.2.4 were applicable, and any Eligible Collateral so furnished which is a Letter of Credit may be reduced by Borrower in an amount equal to the amount Borrower would be entitled to so reduce if Section 6.2.4 hereof were applicable, subject, in each case, to the satisfaction of the conditions precedent to withdrawal of funds or reduction of the Letter of Credit set forth in Section 6.2.4 hereof. In connection with the above-described quarterly update of the projected stages of completion of the Material Alteration or Material Expansion (as concurred with by an Independent Architect), Borrower shall increase (or be permitted to decrease, as applicable) the Eligible Collateral then deposited with Lender as necessary to comply with Section 10.2(h)(i) hereof. (iv) At any time after Final Completion of such Material Alterations or Material Expansions, the whole balance of any Cash deposited with Lender pursuant to Section 10.2(h) hereof then remaining on deposit may be withdrawn by Borrower and shall be paid by Lender to Borrower, and any Eligible Collateral so deposited shall, to the extent it has not been called upon, reduced or theretofore released, be released by Lender to Borrower, within ten (10) days after receipt by Lender of an application for such withdrawal and/or release together with an Officer’s 's Certificate, and as to the following clauses (A) and (B) of this clause also a certificate of the Independent Architect, setting forth in substance as follows: (A) that such Material Alteration(s) or Material Expansion(s) has been completed in all material respects in accordance with any plans and specifications therefor previously filed with Lender under Section 10.2(c) hereof; (B) that to the knowledge of the certifying Person, (x) such Material Alteration(s) or Material Expansion(s) has been completed in compliance with all Legal Requirements, and (y) to the extent required for the legal use or occupancy of the portion of the Property affected by such Alteration(s) or Expansion(s), the applicable Borrower has obtained a temporary or permanent certificate of occupancy (or similar certificate) or, if no such certificate is required, a statement to that effect; (C) that to the knowledge of the certifying Person, all amounts that a Borrower is or may become liable to pay in respect of such Material Alteration(s) or Material Expansion(s) through the date of the certification have been paid in full or adequately provided for and, to the extent that such are customary and reasonably obtainable by prudent property owners in the area where the applicable Property is located, that Lien waivers have been obtained from the general contractor and subcontractors performing such Alteration(s) or Expansion(s) or at its sole cost and expense, Borrower shall cause a nationally recognized title insurance company to deliver to Lender an endorsement to the Title Policy, updating such policy and insuring over such Liens without further exceptions to such policy other than Permitted Encumbrances, or shall, at its sole cost and expense, cause a reputable title insurance company to deliver a lender’s 's title insurance policy, in such form, in such amounts and with such endorsements as the Title Policy, which policy shall be dated the date of completion of the Material Alteration and shall contain no exceptions other than Permitted Encumbrances; provided, however, that if, for any reason, Borrower is are unable to deliver the certification required by this clause (C) with respect to any costs or expenses relating to the Alteration(s) or Expansion(s), then, assuming Borrower is are able to satisfy each of the other requirements set forth in clauses (A) and (B) above, Borrower shall be entitled to the release of the difference between the whole balance of such Eligible Collateral and the total of all costs and expenses to which Borrower is are unable to certify; and (D) that to the knowledge of the certifying Person, no Event of Default has occurred and is continuing.

Appears in 1 contract

Samples: Loan and Security Agreement (CNL Hotels & Resorts, Inc.)

Alterations and Expansions. ~~Borrower~~ A. Tenant may at its expense and without Landlord's prior written consent, make any replacements or alterations to the Premises and may expand the existing Improvements or construct additional Improvements on the Land (an "Expansion"), provided, that (i) the fair market value of the Premises shall not ~~perform or undertake or consent to~~ be lessened thereby, and (ii) no structural elements of the ~~performance or undertaking of any Alteration or Expansion, except in accordance with the following terms and conditions: (a) The Alteration or Expansion~~ Improvements shall be ~~undertaken in accordance with~~ demolished without obtaining Landlord's prior written consent, which consent shall not be unreasonably withheld, conditioned, or delayed, and (iii) such replacements, alterations and/or Expansions will not adversely affect the ~~applicable provisions~~ structure or the safety of this Agreement, the other Loan Documents, the Leases and all Legal Requirements. (b) No Event of Default shall have occurred and be continuing or shall occur as a result of such action. (c) A Material Alteration or Material Expansion, to the extent architects are customarily used for alterations or expansions of those types, but including any structural change to any of the Property or the Improvements, or adversely affect the electrical, heating, ventilating, air-conditioning, plumbing or mechanical systems or the functioning thereof. Landlord has the right to require from Tenant assurances, reasonably acceptable to Landlord, to be delivered to Landlord prior to the commencement of any work, that Tenant will fully perform and complete its Expansion, free and clear of any mechanics' and materialmen's liens. Tenant shall ~~be conducted under the supervision of an Independent Architect~~ procure at its own expense such governmental approvals and shall not be undertaken until ten (10) Business Days after there shall have been filed with Lender, for information purposes only and not for approval by Lender, detailed plans and specifications and cost estimates therefor, prepared and approved in writing by such Independent Architect. Such plans and specifications permits as may be ~~revised at~~ required for any ~~time~~ alterations made by Tenant. At Tenant's expense, Landlord shall join in submitting Tenant's plans for any necessary governmental approval, if required by Legal Requirements. All such construction, alterations, and ~~from time to time~~maintenance work done by, ~~provided that revisions of such plans~~ or for, Tenant shall comply with all Legal Requirements and ~~specifications shall be filed with Lender, for information purposes only. (d) The Alteration or Expansion may not in and of itself, either during the Alteration or Expansion or upon completion~~Insurance Requirements, be reasonably expected to have a Material Adverse Effect with respect to the Property. (e) All work done in connection with any Alteration or Expansion shall be performed with due diligence to Final Completion completed in a good and workmanlike manner, all materials used in connection with any Alteration or Expansion shall be not less than the standard of quality of the materials generally used at the Property as of the date hereof (or, if greater, the then-current customary quality in the sub-market in which the Property is located) and all work shall be performed and all materials used in accordance with all applicable Legal Requirements and Insurance Requirements. (f) The cost of any Alteration or Expansion shall be promptly and fully paid for by Borrower, subject to the next succeeding sentence. No payment made prior to the Final Completion (excluding punch-list items) of an Alteration or Expansion or Restoration to any contractor, subcontractor, materialman, supplier, engineer, architect, project manager or other Person who renders services or furnishes materials in connection with such Alteration shall exceed ninety percent (90%) of the aggregate value of the work performed by such Person from time to time and materials furnished and incorporated into the Improvements. (g) All work performed in connection with the cure of the Deferred Maintenance Conditions shall be performed in accordance with the terms and conditions set forth in clauses (a), (c), (e) and (f) of this Section 10.2. (h) With respect to any Material Alteration or Material Expansion: (i) Borrower shall have delivered to Lender Eligible Collateral in an amount equal to at least the total estimated remaining unpaid costs of such Material Alteration or Material Expansion which is in excess of the Threshold Amount, which Eligible Collateral shall be held by Lender as security for the Indebtedness and released to Borrower as such work progresses in accordance with Section 10.2(h)(iii); provided, however, in the event that any Material Alteration or Material Expansion shall be made in conjunction with any Restoration with respect to which Borrower shall be entitled to use or apply Proceeds pursuant to Section 6.2 hereof (including any Proceeds remaining after completion of such Restoration), the amount of the Eligible Collateral to be furnished pursuant hereto need not exceed the aggregate cost of such Restoration and such Material Alteration or Material Expansion (in either case, as estimated by the Independent Architect) less the sum of the amount of any Proceeds which the Borrower is entitled to withdraw pursuant to Section 6.2 hereof and the Threshold Amount; (ii) Prior to commencement of construction of such Material Alteration or Material Expansion, Borrower shall deliver to Lender a schedule (with the concurrence of the Independent Architect) setting forth the projected stages of completion of such Alteration or Expansion and the corresponding amounts expected to be due and payable by or on behalf of Borrower in connection with such completion, such schedule to be updated quarterly by Borrower (manner and with the concurrence of the Independent Architect) during the performance of such Alteration or Expansion. (iii) Any Eligible Collateral that a Borrower delivers to Lender pursuant hereto (and the proceeds of any such Eligible Collateral) shall be invested (to the extent such Eligible Collateral can be invested) by Lender in Permitted Investments for a period of time consistent with the date on which the Borrower notifies Lender that the Borrower expects to request a release of such Eligible Collateral in accordance with the next succeeding sentence. From time to time as the Alteration or Expansion progresses, the amount of any Eligible Collateral so furnished may, upon the written request of Borrower to Lender, be withdrawn by Borrower and paid or otherwise applied by or returned to Borrower in an amount equal to the amount Borrower would be entitled to so withdraw if Section 6.2.4 were applicablereasonable diligence, and ~~any Eligible Collateral so furnished which is a Letter of Credit may~~ will be reduced by Borrower in an amount equal to the amount Borrower would be entitled to so reduce if Section 6.2.4 hereof were applicable, subject, in each case, to the satisfaction of the conditions precedent to withdrawal of funds or reduction of the Letter of Credit set forth in Section 6.2.4 hereof. In connection with the above-described quarterly update of the projected stages of completion of the Material Alteration or Material Expansion (as concurred with by an Independent Architect), Borrower shall increase (or be permitted to decrease, as applicable) the Eligible Collateral then deposited with Lender as necessary to comply with Section 10.2(h)(i) hereof. (iv) At any time after Final Completion of such Material Alterations or Material Expansions, the whole balance of any Cash deposited with Lender pursuant to Section 10.2(h) hereof then remaining on deposit may be withdrawn by Borrower and shall be paid by Lender to Borrower, and any Eligible Collateral so deposited shall, to the extent it has not been called upon, reduced or theretofore released, be released by Lender to Borrower, within ten (10) days after receipt by Lender of an application for such withdrawal and/or release together with an Officer’s Certificate, and as to the following clauses (A) and (B) of this clause also a certificate of the Independent Architect, setting forth in substance as follows: (A) that such Material Alteration(s) or Material Expansion(s) has been completed in all material respects in accordance with plans prepared by a licensed architect. In the event any Expansion will cost more than One Million Dollars ($1,000,000), adjusted by the GDP Deflator, (w) Tenant shall furnish Landlord with the plans and specifications therefor ~~previously filed with Lender under Section 10.2(c) hereof; (B) that~~ prior to ~~the knowledge of the certifying Person~~commencing work, (x) the contractor selected by Tenant to perform the work shall be subject to Landlord's approval, which approval shall not be unreasonably withheld, conditioned, or delayed, (y) Tenant shall carry builder's risk insurance in amounts reasonably sufficient to cover the cost of replacement of the work during the course of such ~~Material Alteration(s) or Material Expansion(s) has been completed in compliance with all Legal Requirements~~construction, and (yz) upon the request of Landlord or any Mortgagee, provide appropriate securities, completion bonds, or like reasonable assurances that construction will be completed. Tenant shall also furnish Landlord with copies of any and all final plans and specifications (including all changes and modifications thereto) and all necessary governmental permits prepared or issued for all alterations (whether or not Landlord's consent was required in connection with such alterations). B. All replacements, alterations, substitutions and Expansions made to the ~~extent required for~~ Premises (but not the ~~legal use~~ FF&E, Fixed Asset Supplies, or ~~occupancy~~ Inventories) pursuant to this Article 9 shall be and remain part of the ~~portion~~ realty and the property of the Property affected by such Alteration(s) or Expansion(s), the applicable Borrower has obtained a temporary or permanent certificate of occupancy (or similar certificate) or, if no such certificate is required, a statement to that effect; (C) that to the knowledge of the certifying Person, all amounts that a Borrower is or may become liable to pay in respect of such Material Alteration(s) or Material Expansion(s) through the date of the certification have been paid in full or adequately provided for and, to the extent that such are customary Landlord and reasonably obtainable by prudent property owners in the area where the applicable Property is located, that Lien waivers have been obtained from the general contractor and subcontractors performing such Alteration(s) or Expansion(s) or at its sole cost and expense, Borrower shall cause a nationally recognized title insurance company to deliver to Lender an endorsement to the Title Policy, updating such policy and insuring over such Liens without further exceptions to such policy other than Permitted Encumbrances, or shall, at its sole cost and expense, cause a reputable title insurance company to deliver a lender’s title insurance policy, in such form, in such amounts and with such endorsements as the Title Policy, which policy shall be ~~dated the date of completion of the Material Alteration and shall contain no exceptions other than Permitted Encumbrances; provided, however, that if, for any reason, Borrower is unable~~ subject to ~~deliver the certification required by~~ this clause (C) with respect to any costs or expenses relating to the Alteration(s) or Expansion(s), then, assuming Borrower is able to satisfy each of the other requirements set forth in clauses (A) and (B) above, Borrower shall be entitled to the release of the difference between the whole balance of such Eligible Collateral and the total of all costs and expenses to which Borrower is unable to certify; and (D) that to the knowledge of the certifying Person, no Event of Default has occurred and is continuinglease.

Appears in 1 contract

Samples: Lease Agreement (Senior Housing Properties Trust)

Alterations and Expansions. No Borrower ~~shall not~~ or Operating Lessee will perform or undertake or consent to the performance or undertaking of (including, without limitation, the approval of any budget with respect to a Property which includes) any Alteration or Expansion, except in accordance with the following terms and conditions: (a) The Alteration or Expansion shall be undertaken in accordance with the applicable provisions of this Agreement, the other Loan Documents, the ~~Leases~~ Property Management Agreements, the Operating Agreements and the Leases, and all Legal Requirements. (b) No Event of Default shall have occurred and be continuing or shall occur as a result of such action. (c) A Material Alteration or Material Expansion, to the extent architects are customarily used for alterations or expansions of those types, but including any structural change to any of the ~~Property~~ Properties or the Improvements, shall be conducted under the supervision of an Independent Architect and shall not be undertaken until ten (10) Business Days after there shall have been filed with Lender, for information purposes only and not for approval by Lender, detailed plans and specifications and cost estimates therefor, prepared and approved in writing by such Independent Architect. Such plans and specifications may be revised at any time and from time to time, provided that revisions of such plans and specifications shall be filed with Lender, for information purposes only. (d) The Alteration or Expansion may not in and of itself, either during the Alteration or Expansion or upon completion, be reasonably expected to have a Material Adverse Effect with respect to a Property or adversely affect the ~~Property~~annual Net Operating Income, taking into account the required escrows (or completion bond) provided under Section 7.1(h)(i) below; provided that if, as reasonably determined by the Lender, such Alteration or Expansion would adversely affect the annual Net Operating Income, then in order to proceed with the Alteration or Expansion the Borrowers shall deliver to Lender Eligible Collateral in the total amount of the estimated reduction in Net Operating Income resulting from the Alteration or Expansion as additional security for the Debt. On each Payment Date during the period in which such Alteration or Expansion is being performed, Lender shall release a portion of such Eligible Collateral to Borrower in an amount equal to the estimated reduction in the Net Operating Income resulting from the Alteration or Expansion for the month in which the Payment Date occurs. Any remaining Eligible Collateral shall be returned to Borrowers after completion of the Alteration or Expansion if the reduction in Net Operating Income has been restored and no Event of Default has occurred and is continuing. (e) All work done in connection with any Alteration or Expansion shall be performed with due diligence to Final Completion in a good and workmanlike manner, all materials used in connection with any Alteration or Expansion shall be not less than the standard of quality of the materials generally used at the applicable Property as of the date hereof (or, if greater, the then-current customary quality in the ~~sub-market~~ submarket in which ~~the~~ such Property is located) and all work shall be performed and all materials used in accordance with all applicable Legal Requirements and Insurance Requirements. (f) The cost of any Alteration or Expansion shall be promptly and fully paid for by ~~Borrower~~Borrowers, subject to the next succeeding sentence. No payment made prior to the Final Completion ~~(excluding punch-list items)~~ of an Alteration or Expansion or Restoration to any contractor, subcontractor, materialman, supplier, engineer, architect, project manager or other Person who renders services or furnishes materials in connection with such Alteration shall exceed ninety percent (90%) (other than with respect to FF&E for which Borrower may make payments in full prior to Final Completion if it has received delivery of such items and otherwise has complied with the terms of Section 9.2.16) of the aggregate value of the work performed by such Person from time to time and materials furnished and incorporated into the Improvements. (g) All work performed in connection with the (i) cure of the Deferred Maintenance Conditions and (ii) remediation of the Environmental Conditions shall be performed in accordance with the terms and conditions set forth in clauses (a), (c), (e) and (f) of this Section ~~10.2~~7. 1. Subject to Section 7.1(f) above, from time to time as the cure or remediation of any particular Deferred Maintenance Condition or Environmental Condition progresses, Lender shall, subject to and upon the satisfaction of the terms and conditions set forth in Section 9.2.2 herein, disburse to Borrowers from the Deferred Maintenance and Environmental Conditions Reserve Account, amounts incurred by Borrowers in connection with the cure or remediation of the Deferred Maintenance Condition or Environmental Condition in question. (h) With respect to any Material Alteration or Material Expansion: (i) ~~Borrower~~ Borrowers shall have delivered to Lender Eligible Collateral in an amount equal to at least the total estimated remaining unpaid costs of such Material Alteration or Material Expansion which ~~is in excess of the Threshold Amount, which~~ Eligible Collateral shall be held by Lender as security for the ~~Indebtedness~~ Debt and released to the applicable Borrower as such work progresses in accordance with Section ~~10.2(h)(iii)~~7.1(h)(iii) hereof; provided, however, in the event that any Material Alteration or Material Expansion shall be made in conjunction with any Restoration with respect to which a Borrower shall be entitled to ~~use or apply~~ withdraw Proceeds pursuant to Section ~~6.2~~ 8.1.2(b) hereof (including any Proceeds remaining after completion of such Restoration), the amount of the Eligible Collateral to be furnished pursuant hereto need not exceed the aggregate cost of such Restoration and such Material Alteration or Material Expansion (in either case, as estimated by the Independent Architect) less the sum of the amount of any Proceeds which ~~the~~ any Borrower is entitled to withdraw pursuant to Section ~~6.2 hereof and the Threshold Amount~~8.1 hereof; (ii) Prior to commencement of construction of such Material Alteration or Material Expansion, ~~Borrower~~ Borrowers shall deliver to Lender a schedule (with the concurrence of the Independent Architect) setting forth the projected stages of completion of such Alteration or Expansion and the corresponding amounts expected to be due and payable by or on behalf of ~~Borrower~~ Borrowers in connection with such completion, such schedule to be updated quarterly by ~~Borrower~~ Borrowers (and with the concurrence of the Independent Architect) during the performance of such Alteration or Expansion. (iii) Any Eligible Collateral that a Borrower delivers to Lender pursuant hereto (and the proceeds of any such Eligible Collateral) shall be invested (to the extent such Eligible Collateral can be invested) by Lender in Permitted Investments for a period of time consistent with the date on which ~~the~~ such Borrower notifies Lender that ~~the~~ such Borrower expects to request a release of such Eligible Collateral in accordance with the next succeeding sentence. From time to time as the Alteration or Expansion progresses, the amount of any Eligible Collateral so furnished may, upon the written request of any Borrower to Lender, be withdrawn by ~~Borrower~~ Borrowers and paid or otherwise applied by or returned to ~~Borrower~~ Borrowers in an amount equal to the amount ~~Borrower~~ Borrowers would be entitled to so withdraw if Section ~~6.2.4~~ 8.1.2(e) hereof were applicable, and any Eligible Collateral so furnished which is a ~~Letter of~~ Credit Facility may be reduced by ~~Borrower~~ Borrowers in an amount equal to the amount ~~Borrower~~ Borrowers would be entitled to so reduce if Section ~~6.2.4~~ 8.1.2(e) hereof were applicable, subject, in each case, to the satisfaction of the conditions precedent to withdrawal of funds or reduction of the ~~Letter of~~ Credit Facility set forth in Section ~~6.2.4~~ 8.1.2(e) hereof, provided however that, notwithstanding the terms of Section 8.1.2(e), instead of reimbursing Borrowers for amounts already paid in respect of such Alteration or Expansion, Eligible Collateral shall be disbursed to Borrower or, at Lender's election, the applicable contractor upon presentation to Lender of a draw request together with copies of invoices for the amounts to be withdrawn. In connection with the above-described quarterly update of the projected stages of completion of the Material Alteration or Material Expansion (as concurred with by an Independent Architect), ~~Borrower~~ Borrowers shall increase (or be permitted to decrease, as applicable) the Eligible Collateral then deposited with Lender as necessary to comply with Section ~~10.2(h)(i~~7.1(h)(i) hereof. (iv) At any time after Final Completion of such ~~Material~~ Alterations or ~~Material~~ Expansions, the whole balance of any Cash deposited with Lender pursuant to Section ~~10.2(h~~7.1(h) hereof then remaining on deposit may be withdrawn by ~~Borrower~~ Borrowers and shall be paid by Lender to ~~Borrower~~Borrowers, and any Eligible Collateral so deposited shall, to the extent it has not been called upon, reduced or theretofore released, be released by Lender to ~~Borrower~~Borrowers, within ten (10) days after receipt by Lender of an application for such withdrawal and/or release together with an Officer’s 's Certificate, and as to the following clauses (A) and (B) of this clause also a certificate of the Independent Architect, setting forth in substance as follows: (A) that such ~~Material~~ Alteration(s) or ~~Material~~ Expansion(s) has been completed in all material respects in accordance with any plans and specifications therefor previously filed with Lender under Section ~~10.2(c~~7.1(c) hereof; (B) that to the knowledge of the certifying Person, (x) such ~~Material~~ Alteration(s) or ~~Material~~ Expansion(s) has been completed in compliance with all Legal Requirements, and (y) to the extent required for the legal use or occupancy of the portion of the Property affected by such Alteration(s) or Expansion(s), the applicable Borrower has obtained a temporary or permanent certificate of occupancy (or similar certificate) or, if no such certificate is required, a statement to that effect; (C) that to the knowledge of the certifying Person, all amounts that a Borrower is or may become liable to pay in respect of such ~~Material~~ Alteration(s) or ~~Material~~ Expansion(s) through the date of the certification have been paid in full or adequately provided for and, to the extent that such are customary and reasonably obtainable by prudent property owners in the area where the applicable Property is located, that Lien waivers have been obtained from the general contractor and subcontractors performing such Alteration(s) or Expansion(s) or at its sole cost and expense, ~~Borrower~~ Borrowers shall cause a nationally recognized title insurance company to deliver to Lender an endorsement to the Qualified Title Policy, updating such policy and insuring over such Liens without further exceptions to such policy other than Permitted Encumbrances, or shall, at its sole cost and expense, cause a reputable title insurance company to deliver a lender’s 's title insurance policy, in such form, in such amounts and with such endorsements as the Qualified Title Policy, which policy shall be dated the date of completion of the Material Alteration and shall contain no exceptions other than Permitted Encumbrances; provided, however, that if, for any reason, ~~Borrower is~~ Borrowers are unable to deliver the certification required by this clause (C) with respect to any costs or expenses relating to the Alteration(s) or Expansion(s), then, assuming ~~Borrower is~~ Borrowers are able to satisfy each of the other requirements set forth in clauses (A) and (B) above, ~~Borrower~~ Borrowers shall be entitled to the release of the difference between the whole balance of such Eligible Collateral and the total of all costs and expenses to which ~~Borrower is~~ Borrowers are unable to certify; and (D) that to the knowledge of the certifying Person, no Event of Default has occurred and is continuing.

Appears in 1 contract

Samples: Loan Agreement (Strategic Hotel Capital Inc)

Alterations and Expansions. Borrower shall not perform or undertake or consent to ~~the performance~~ or ~~undertaking of~~ permit Operating Lessee or any other Person to perform or undertake any Alteration or Expansion, except in accordance with the following terms and conditions: (aA) The Alteration or Expansion shall be undertaken in accordance with the applicable provisions of this Agreement, the other Loan Documents, the Leases and all Legal Requirements. (bB) No Event of Default shall have occurred and be continuing or shall occur as a result of such action. (cC) A Material ~~Alteration or Material Expansion~~Alteration, to the extent architects are customarily used for alterations or expansions of those types, but including any structural change to any of the Property or the Improvements, shall be conducted under the supervision of an Independent Architect and shall not be undertaken until ten (10) Business Days after there shall have been filed with ~~Lender~~Administrative Agent, for information purposes only and not for approval by ~~Lender~~Administrative Agent, detailed plans and specifications and cost estimates therefor, prepared and approved in writing by such Independent Architect. Such plans and specifications may be revised at any time and from time to time, provided that revisions of such plans and specifications shall be filed with ~~Lender~~Administrative Agent, for information purposes only. (dD) The Alteration or Expansion may not in and of itself, either during the Alteration or Expansion or upon completion, be reasonably expected to have a Material Adverse Effect with respect to the ~~Property~~Property or, if a Cash Sweep Period then exists, adversely affect the annual Net Operating Income by more than $500,000, taking into account the required escrows (or completion bond) provided under clause (h)(i) below; provided that if, as reasonably determined by the Administrative Agent, such Alteration or Expansion would reduce annual Net Operating Income by $500,000 or more and a Cash Sweep Period then exists, then in order to proceed with the Alteration or Expansion the Borrower shall deliver to Lender Eligible Collateral in the amount that the projected reduction in Net Operating Income resulting from the Alteration or Expansion exceeds $500,000 as additional security for the Indebtedness, which Eligible Collateral shall be returned to Borrower after evidence of completion of the applicable Alteration or Expansion and no Event of Default has occurred and is continuing. (eE) All work done in connection with any Alteration or Expansion shall be performed with due diligence to Final Completion in a good and workmanlike manner, all materials used in connection with any Alteration or Expansion shall be not less than the standard of quality of the materials generally used at the Property as of the date hereof (or, if greater, the then-current customary quality in the sub-market in which the Property is located) and all work shall be performed and all materials used in accordance with all applicable Legal Requirements and Insurance Requirements. (fF) The cost of any Alteration or Expansion shall be promptly and fully paid for by Borrower, subject to the next succeeding sentence. No payment made prior to the Final Completion (excluding punch-list items) of an Alteration or Expansion or Restoration to any contractor, subcontractor, materialman, supplier, engineer, architect, project manager or other Person who renders services or furnishes materials in connection with such Alteration shall exceed ninety percent (90%) of the aggregate value of the work performed by such Person from time to time and materials furnished and incorporated into the Improvements. (gG) All work performed in connection with the (i) cure of the Deferred Maintenance Conditions and (ii) remediation of the Environmental Conditions shall be performed in accordance with the terms and conditions set forth in clauses (aA), (cC), (eE) ~~and~~ And (fF) of this Section 10.2. Subject to Section 10.2(F) above, from time to time as the cure or remediation of any particular Deferred Maintenance Condition or Environmental Condition progresses, Administrative Agent shall, subject to and upon the satisfaction of the terms and conditions set forth in Section 16.4, disburse to Borrower from the Deferred Maintenance and Environmental Conditions Reserve Account, amounts incurred in connection with the cure or remediation of the Deferred Maintenance Condition or Environmental Condition in question. (hH) With respect to any Material ~~Alteration or Material Expansion~~Alteration: (i) Borrower shall have delivered to Lender Eligible Collateral in an amount equal to at least the total estimated remaining unpaid costs of such Material Alteration ~~or Material Expansion~~ which is in excess of the Threshold Amount, which Eligible Collateral shall be held by ~~Lender~~ Administrative Agent as security for the Indebtedness and released to Borrower as such work progresses in accordance with Section 10.2(h)(iii); provided, however, in the event that any Material Alteration ~~or Material Expansion~~ shall be made in conjunction with any Restoration with respect to which Borrower shall be entitled to ~~use or apply~~ withdraw Proceeds pursuant to Section 6.2 hereof (including any Proceeds remaining after completion of such Restoration), the amount of the Eligible Collateral to be furnished pursuant hereto need not exceed the aggregate cost of such Restoration and such Material Alteration ~~or Material Expansion~~ (in either case, as estimated by the Independent Architect) less the sum of the amount of any Proceeds which the Borrower is entitled to withdraw pursuant to Section 6.2 hereof and the Threshold Amount; (ii) Prior to commencement of construction of such Material ~~Alteration or Material Expansion~~Alteration, Borrower shall deliver to ~~Lender~~ Administrative Agent a schedule (with the concurrence of the Independent Architect) setting forth the projected stages of completion of such Alteration or Expansion and the corresponding amounts expected to be due and payable by or on behalf of Borrower in connection with such completion, such schedule to be updated quarterly by Borrower (and with the concurrence of the Independent Architect) during the performance of such Alteration or Expansion. (iii) Any Eligible Collateral that a Borrower delivers to ~~Lender~~ Administrative Agent pursuant hereto (and the proceeds of any such Eligible Collateral) shall be invested (to the extent such Eligible Collateral can be invested) by ~~Lender~~ Administrative Agent in Permitted Investments for a period of time consistent with the date on which the Borrower notifies ~~Lender~~ Administrative Agent that the Borrower expects to request a release of such Eligible Collateral in accordance with the next succeeding sentence. From time to time as the Material Alteration ~~or Expansion~~ progresses, the amount of any Eligible Collateral so furnished may, upon the written request of Borrower to ~~Lender~~Administrative Agent, be withdrawn by Borrower and paid or otherwise applied by or returned to Borrower in an amount equal to the amount Borrower would be entitled to so withdraw if Section 6.2.4 were applicable, and any Eligible Collateral so furnished which is a Letter of Credit may be reduced by Borrower in an amount equal to the amount Borrower would be entitled to so reduce if Section 6.2.4 hereof were applicable, subject, in each case, subject to the satisfaction of the conditions precedent to withdrawal of funds ~~or reduction of the Letter of Credit~~ set forth in Section 6.2.4 hereof. In connection with the above-described quarterly update of the projected stages of completion of the Material Alteration ~~or Material Expansion~~ (as concurred with by an Independent Architect), Borrower shall increase (or be permitted to decrease, as applicable) the Eligible Collateral then deposited with ~~Lender~~ Administrative Agent as necessary to comply with Section 10.2(h)(i) hereof. (iv) At any time after Final Completion of such Material ~~Alterations or Material Expansions~~Alterations, the whole balance of any Cash deposited with ~~Lender~~ Administrative Agent pursuant to Section 10.2(h) hereof then remaining on deposit may be withdrawn by Borrower and shall be paid by ~~Lender~~ Administrative Agent to Borrower, and any Eligible Collateral so deposited shall, to the extent it has not been called upon, reduced or theretofore released, be released by ~~Lender~~ Administrative Agent to Borrower, within ten (10) days after receipt by ~~Lender~~ Administrative Agent of an application for such withdrawal and/or release ~~together with~~ and satisfaction of each of the following conditions, as certified by an Officer’s ~~Certificate~~Certificate that such statements are true, and as to the following clauses (A) and (B) of this clause also a certificate of the Independent Architect~~, setting forth in substance as follows~~: (A) ~~that~~ such Material Alteration(s) ~~or Material Expansion(s) has~~ shall have been completed in all material respects in accordance with any plans and specifications therefor previously filed with ~~Lender~~ Administrative Agent under Section ~~10.2(c~~10.2(C) hereof; (B) that to the Best of Borrower’s Knowledge and the knowledge of the certifying ~~Person,~~ person (x) such Material Alteration(s~~) or Material Expansion(s~~) has been completed in compliance with all Legal Requirements, and (y) to the extent required for the legal use or occupancy of the portion of the Property affected by such Alteration(s) or Expansion(s), the applicable Borrower has obtained a temporary or permanent certificate of occupancy (or similar certificate) or, if no such certificate is required, a statement to that effect; (C) that to the Best of Borrower’s Knowledge and the knowledge of the certifying ~~Person~~person, all amounts that a Borrower is or may become liable to pay in respect of such Material Alteration(s~~) or Material Expansion(s~~) through the date of the certification have been paid in full or adequately provided for and, to the extent that such are customary and reasonably obtainable by prudent property owners in the area where the applicable Property is located, that Lien waivers have been obtained from the general contractor and subcontractors performing such Alteration(s) or Expansion(s) or at its sole cost and expense, Borrower shall cause a nationally recognized title insurance company to deliver to ~~Lender~~ Administrative Agent an endorsement to the Title Policy, updating such policy and insuring over such Liens without further exceptions to such policy other than Permitted Encumbrances, or shall, at its sole cost and expense, cause a reputable title insurance company to deliver a lender’s title insurance policy, in such form, in such amounts and with such endorsements as the Title Policy, which policy shall be dated the date of completion of the Material Alteration and shall contain no exceptions other than Permitted Encumbrances; provided, however, that if, for any reason, Borrower is are unable to deliver the certification required by this clause (C) with respect to any costs or expenses relating to the Alteration(s) or Expansion(s), then, assuming Borrower is are able to satisfy each of the other requirements set forth in clauses (A) and (B) above, Borrower shall be entitled to the release of the difference between the whole balance of such Eligible Collateral and the total of all costs and expenses to which Borrower is are unable to certify; and (D) that to the Best of Borrower’s Knowledge and the knowledge of the certifying ~~Person~~person, no Event of Default has occurred and is continuing.

Appears in 1 contract

Samples: Loan and Security Agreement (Strategic Hotels & Resorts, Inc)

Alterations and Expansions. Borrower shall not perform or undertake or consent to the performance or undertaking of any Alteration or Expansion, except in accordance with the following terms and conditions: (a) The Alteration or Expansion shall be undertaken in accordance with the applicable provisions of this Agreement, the other Loan Documents, the Leases and all Legal Requirements. (b) No Subject to the terms of Section 10.2(i), no Event of Default shall have occurred and be continuing or shall occur as a result of such action. (c) A Subject to the terms of Section 10.2(i), a Material Alteration or Material Expansion, to the extent architects are customarily used for alterations or expansions of those types, but including any structural change to any of the Property or the Improvements, shall be conducted under the supervision of an Independent Architect and shall not be undertaken until ten (10) Business Days after there shall have been filed with Lender, for information purposes only and not for approval by Lender, detailed plans and specifications and cost estimates therefor, prepared and approved in writing by such Independent Architect. Such plans and specifications may be revised at any time and from time to time, provided that revisions of such plans and specifications shall be filed with Lender, for information purposes only. (d) ~~The~~ Subject to the terms of Section 10.2(i), the Alteration or Expansion may not in and of itself, either during the Alteration or Expansion or upon completion, be reasonably expected to have a Material Adverse Effect with respect to the ~~Property~~Property or adversely affect the annual Net Operating Income, taking into account the required escrows (or completion bond) 116 provided under clause (h)(i) below; provided that if, as reasonably determined by the Lender, such Alteration or Expansion (or then current Alterations or Expansions in the aggregate) would adversely affect the annual Net Operating Income, then in order to proceed with the Alteration or Expansion the Borrower shall deliver to Lender Eligible Collateral in the amount that the estimated total reduction in Net Operating Income resulting from the Alteration or Expansion exceeds $1,000,000 as additional security for the Indebtedness, which Eligible Collateral shall be returned to Borrower after completion of the Alteration or Expansion if the reduction in Net Operating Income attributable to such Alteration or Expansion pursuant to this Section 10.2(d) has been restored and no Event of Default has occurred and is continuing. (e) All work done in connection with any Alteration or Expansion shall be performed with due diligence to Final Completion in a good and workmanlike manner, all materials used in connection with any Alteration or Expansion shall be not less than the standard of quality of the materials generally used at the Property as of the date hereof (or, if greater, the then-current customary quality in the sub-market in which the Property is located) and all work shall be performed and all materials used in accordance with all applicable Legal Requirements and Insurance Requirements. (f) The cost of any Alteration or Expansion shall be promptly and fully paid for by Borrower, subject to the next succeeding sentence. No Without Lender's prior written consent, no payment made prior to the Final Completion (excluding punch-list items) of an Alteration or Expansion or Restoration to any contractor, subcontractor, materialman, supplier, engineer, architect, project manager or other Person who renders services or furnishes materials in connection with such Alteration shall exceed ninety percent (90%) of the aggregate value of the work performed by such Person (other than any retention for major contractors who have completed their work) from time to time and materials furnished and incorporated into the Improvements. (g) ~~All~~ Subject to the terms of Section 10.2(i), all work performed in connection with the ~~cure of the Deferred Maintenance Conditions~~ Approved Base Building Work listed on Schedule II shall be performed in accordance with the terms and conditions set forth in clauses (a), (~~c), (~~e) and (f) of this Section 10.2. (h) ~~With~~ Subject to the terms of Section 10.2(i), with respect to any Material Alteration or Material Expansion: (i) Borrower shall have delivered to Lender Eligible Collateral in an amount equal to at least the total estimated remaining unpaid costs of such Material Alteration or Material Expansion which is in excess of the Threshold Amount, which Eligible Collateral shall be held by Lender as security for the Indebtedness and released to Borrower as such work progresses in accordance with Section 10.2(h)(iii); provided, however, in the event that any Material Alteration or Material Expansion shall be made in conjunction with any Restoration with respect to which Borrower shall be entitled to ~~use or apply~~ withdraw Proceeds pursuant to Section 6.2 hereof (including any Proceeds remaining after completion of such Restoration), the amount of the Eligible Collateral to be furnished pursuant hereto need not exceed the aggregate cost of such Restoration and such Material Alteration or Material Expansion (in either case, as estimated by the Independent Architect) less the sum of the amount of any Proceeds which the Borrower is entitled to withdraw pursuant to Section 6.2 hereof and the Threshold Amount;. 117 (ii) Prior to commencement of construction of such Material Alteration or Material Expansion, Borrower shall deliver to Lender a schedule (with the concurrence of the Independent Architect) setting forth the projected stages of completion of such Alteration or Expansion and the corresponding amounts expected to be due and payable by or on behalf of Borrower in connection with such completion, such schedule to be updated quarterly by Borrower (and with the concurrence of the Independent Architect) during the performance of such Alteration or Expansion. (iii) Any Eligible Collateral that a Borrower delivers to Lender pursuant hereto (and the proceeds of any such Eligible Collateral) shall be invested (to the extent such Eligible Collateral can be invested) by Lender in Permitted Investments for a period of time consistent with the date on which the Borrower notifies Lender that the Borrower expects to request a release of such Eligible Collateral in accordance with the next succeeding sentence. From time to time as the Alteration or Expansion progresses, the amount of any Eligible Collateral so furnished may, upon the written request of Borrower to Lender, be withdrawn by Borrower and paid or otherwise applied by or returned to Borrower in an amount equal to the amount Borrower would be entitled to so withdraw if Section 6.2.4 were applicable, and any Eligible Collateral so furnished which is a Letter of Credit may be reduced by Borrower in an amount equal to the amount Borrower would be entitled to so reduce if Section 6.2.4 hereof were applicable, subject, in each case, to the satisfaction of the conditions precedent to withdrawal of funds or reduction of the Letter of Credit set forth in Section 6.2.4 hereof. In connection with the above-described quarterly update of the projected stages of completion of the Material Alteration or Material Expansion (as concurred with by an Independent Architect), Borrower shall increase (or be permitted to decrease, as applicable) the Eligible Collateral then deposited with Lender as necessary to comply with Section 10.2(h)(i) hereof6. (iv) At any time after Final Completion of such Material Alterations or Material Expansions, the whole balance of any Cash deposited with Lender pursuant to Section 10.2(h) hereof then remaining on deposit may be withdrawn by Borrower and shall be paid by Lender to Borrower, and any Eligible Collateral so deposited shall, to the extent it has not been called upon, reduced or theretofore released, be released by Lender to Borrower, within ten (10) days after receipt by Lender of an application for such withdrawal and/or release together with an Officer’s Certificate, and as to the following clauses (A) and (B) of this clause also a certificate of the Independent Architect, setting forth in substance as follows: (A) that such Material Alteration(s) or Material Expansion(s) has been completed in all material respects in accordance with any plans and specifications therefor previously filed with Lender under Section 10.2(c) hereof; (B) that to the knowledge of the certifying Person, (x) such Material Alteration(s) or Material Expansion(s) has been completed in compliance with all Legal Requirements, and (y) to the extent required for the legal use or occupancy of the portion of the Property affected by such Alteration(s) or Expansion(s), the applicable Borrower has obtained a temporary or permanent certificate of occupancy (or similar certificate) or, if no such certificate is required, a statement to that effect; (C) that to the knowledge of the certifying Person, all amounts that a Borrower is or may become liable to pay in respect of such Material Alteration(s) or Material Expansion(s) through the date of the certification have been paid in full or adequately provided for and, to the extent that such are customary and reasonably obtainable by prudent property owners in the area where the applicable Property is located, that Lien waivers have been obtained from the general contractor and subcontractors performing such Alteration(s) or Expansion(s) or at its sole cost and expense, Borrower shall cause a nationally recognized title insurance company to deliver to Lender an endorsement to the Title Policy, updating such policy and insuring over such Liens without further exceptions to such policy other than Permitted Encumbrances, or shall, at its sole cost and expense, cause a reputable title insurance company to deliver a lender’s title insurance policy, in such form, in such amounts and with such endorsements as the Title Policy, which policy shall be dated the date of completion of the Material Alteration and shall contain no exceptions other than Permitted Encumbrances; provided, however, that if, for any reason, Borrower is unable to deliver the certification required by this clause (C) with respect to any costs or expenses relating to the Alteration(s) or Expansion(s), then, assuming Borrower is able to satisfy each of the other requirements set forth in clauses (A) and (B) above, Borrower shall be entitled to the release of the difference between the whole balance of such Eligible Collateral and the total of all costs and expenses to which Borrower is unable to certify; and (D) that to the knowledge of the certifying Person, no Event of Default has occurred and is continuing.

Appears in 1 contract

Samples: Loan and Security Agreement (CNL Hotels & Resorts, Inc.)

Alterations and Expansions. Borrower shall not perform or undertake or consent to ~~the performance~~ or ~~undertaking of~~ permit Operating Lessee or any other Person to perform or undertake any Alteration or Expansion, except in accordance with the following terms and conditions: (aA) The Alteration or Expansion shall be undertaken in accordance with the applicable provisions of this Agreement, the other Loan Documents, the Leases and all Legal Requirements. (bB) No Event of Default shall have occurred and be continuing or shall occur as a result of such action. (cC) A Material ~~Alteration or Material Expansion~~Alteration, to the extent architects are customarily used for alterations or expansions of those types, but including any structural change to any of the Property or the Improvements, shall be conducted under the supervision of an Independent Architect and shall not be undertaken until ten (10) Business Days after there shall have been filed with ~~Lender~~Administrative Agent, for information purposes only and not for approval by ~~Lender~~Administrative Agent, detailed plans and specifications and cost estimates therefor, prepared and approved in writing by such Independent Architect. Such plans and specifications may be revised at any time and from time to time, provided that revisions of such plans and specifications shall be filed with ~~Lender~~Administrative Agent, for information purposes only. (dD) The Alteration or Expansion may not in and of itself, either during the Alteration or Expansion or upon completion, be reasonably expected to have a Material Adverse Effect with respect to the ~~Property~~Property or, if a Cash Sweep Period then exists, adversely affect the annual Net Operating Income by more than $500,000, taking into account the required escrows (or completion bond) provided under clause (H)(i) below; provided that if, as reasonably determined by the Administrative Agent, such Alteration or Expansion would reduce annual Net Operating Income by $500,000 or more and a Cash Sweep Period then exists, then in order to proceed with the Alteration or Expansion the Borrower shall deliver to Lender Eligible Collateral in the amount that the projected reduction in Net Operating Income resulting from the Alteration or Expansion exceeds $500,000 as additional security for the Indebtedness, which Eligible Collateral shall be returned to Borrower after evidence of completion of the applicable Alteration or Expansion and no Event of Default has occurred and is continuing. (eE) All work done in connection with any Alteration or Expansion shall be performed with due diligence to Final Completion in a good and workmanlike manner, all materials used in connection with any Alteration or Expansion shall be not less than the standard of quality of the materials generally used at the Property as of the date hereof (or, if greater, the then-current customary quality in the sub-market in which the Property is located) and all work shall be performed and all materials used in accordance with all applicable Legal Requirements and Insurance Requirements. (fF) The cost of any Alteration or Expansion shall be promptly and fully paid for by Borrower, subject to the next succeeding sentence. No payment made prior to the Final Completion (excluding punch-list items) of an Alteration or Expansion or Restoration to any contractor, subcontractor, materialman, supplier, engineer, architect, project manager or other Person who renders services or furnishes materials in connection with such Alteration shall exceed ninety percent (90%) of the aggregate value of the work performed by such Person from time to time and materials furnished and incorporated into the Improvements. (gG) All work performed in connection with the (i) cure of the Deferred Maintenance Conditions and (ii) remediation of the Environmental Conditions shall be performed in accordance with the terms and conditions set forth in clauses (aA), (cC), (eE) and (fF) of this Section 10.2. Subject to Section 10.2(F) above, from time to time as the cure or remediation of any particular Deferred Maintenance Condition or Environmental Condition progresses, Administrative Agent shall, subject to and upon the satisfaction of the terms and conditions set forth in Section 16.4, disburse to Borrower from the Deferred Maintenance and Environmental Conditions Reserve Account, amounts incurred in connection with the cure or remediation of the Deferred Maintenance Condition or Environmental Condition in question. (hH) With respect to any Material ~~Alteration or Material Expansion~~Alteration: (i) Borrower shall have delivered to Lender Eligible Collateral in an amount equal to at least the total estimated remaining unpaid costs of such Material Alteration ~~or Material Expansion~~ which is in excess of the Threshold Amount, which Eligible Collateral shall be held by ~~Lender~~ Administrative Agent as security for the Indebtedness and released to Borrower as such work progresses in accordance with Section ~~10.2(h)(iii~~10.2(H)(iii); provided, however, in the event that any Material Alteration ~~or Material Expansion~~ shall be made in conjunction with any Restoration with respect to which Borrower shall be entitled to ~~use or apply~~ withdraw Proceeds pursuant to Section 6.2 hereof (including any Proceeds remaining after completion of such Restoration), the amount of the Eligible Collateral to be furnished pursuant hereto need not exceed the aggregate cost of such Restoration and such Material Alteration ~~or Material Expansion~~ (in either case, as estimated by the Independent Architect) less the sum of the amount of any Proceeds which the Borrower is entitled to withdraw pursuant to Section 6.2 hereof and the Threshold Amount; (ii) Prior to commencement of construction of such Material ~~Alteration or Material Expansion~~Alteration, Borrower shall deliver to ~~Lender~~ Administrative Agent a schedule (with the concurrence of the Independent Architect) setting forth the projected stages of completion of such Alteration or Expansion and the corresponding amounts expected to be due and payable by or on behalf of Borrower in connection with such completion, such schedule to be updated quarterly by Borrower (and with the concurrence of the Independent Architect) during the performance of such Alteration or Expansion. (iii) Any Eligible Collateral that a Borrower delivers to ~~Lender~~ Administrative Agent pursuant hereto (and the proceeds of any such Eligible Collateral) shall be invested (to the extent such Eligible Collateral can be invested) by ~~Lender~~ Administrative Agent in Permitted Investments for a period of time consistent with the date on which the Borrower notifies ~~Lender~~ Administrative Agent that the Borrower expects to request a release of such Eligible Collateral in accordance with the next succeeding sentence. From time to time as the Material Alteration ~~or Expansion~~ progresses, the amount of any Eligible Collateral so furnished may, upon the written request of Borrower to ~~Lender~~Administrative Agent, be withdrawn by Borrower and paid or otherwise applied by or returned to Borrower in an amount equal to the amount Borrower would be entitled to so withdraw if Section 6.2.4 were applicable, and any Eligible Collateral so furnished which is a Letter of Credit may be reduced by Borrower in an amount equal to the amount Borrower would be entitled to so reduce if Section 6.2.4 hereof were applicable, subject, in each case, subject to the satisfaction of the conditions precedent to withdrawal of funds ~~or reduction of the Letter of Credit~~ set forth in Section 6.2.4 hereof. In connection with the above-described quarterly update of the projected stages of completion of the Material Alteration ~~or Material Expansion~~ (as concurred with by an Independent Architect), Borrower shall increase (or be permitted to decrease, as applicable) the Eligible Collateral then deposited with ~~Lender~~ Administrative Agent as necessary to comply with Section ~~10.2(h)(i~~10.2(H)(i) hereof. (iv) At any time after Final Completion of such Material ~~Alterations or Material Expansions~~Alterations, the whole balance of any Cash deposited with ~~Lender~~ Administrative Agent pursuant to Section 10.2(h) hereof then remaining on deposit may be withdrawn by Borrower and shall be paid by ~~Lender~~ Administrative Agent to Borrower, and any Eligible Collateral so deposited shall, to the extent it has not been called upon, reduced or theretofore released, be released by ~~Lender~~ Administrative Agent to Borrower, within ten (10) days after receipt by ~~Lender~~ Administrative Agent of an application for such withdrawal and/or release ~~together with~~ and satisfaction of each of the following conditions, as certified by an Officer’s ~~Certificate~~Certificate that such statements are true, and as to the following clauses (A) and (B) of this clause also a certificate of the Independent Architect~~, setting forth in substance as follows~~: (A) ~~that~~ such Material Alteration(s) ~~or Material Expansion(s) has~~ shall have been completed in all material respects in accordance with any plans and specifications therefor previously filed with ~~Lender~~ Administrative Agent under Section ~~10.2(c~~10.2(C) hereof; (B) that to the Best of Borrower’s Knowledge and the knowledge of the certifying ~~Person,~~ person (x) such Material Alteration(s~~) or Material Expansion(s~~) has been completed in compliance with all Legal Requirements, and (y) to the extent required for the legal use or occupancy of the portion of the Property affected by such Alteration(s) or Expansion(s), the applicable Borrower has obtained a temporary or permanent certificate of occupancy (or similar certificate) or, if no such certificate is required, a statement to that effect; (C) that to the Best of Borrower’s Knowledge and the knowledge of the certifying ~~Person~~person, all amounts that a Borrower is or may become liable to pay in respect of such Material Alteration(s~~) or Material Expansion(s~~) through the date of the certification have been paid in full or adequately provided for and, to the extent that such are customary and reasonably obtainable by prudent property owners in the area where the applicable Property is located, that Lien waivers have been obtained from the general contractor and subcontractors performing such Alteration(s) or Expansion(s) or at its sole cost and expense, Borrower shall cause a nationally recognized title insurance company to deliver to ~~Lender~~ Administrative Agent an endorsement to the Title Policy, updating such policy and insuring over such Liens without further exceptions to such policy other than Permitted Encumbrances, or shall, at its sole cost and expense, cause a reputable title insurance company to deliver a lender’s title insurance policy, in such form, in such amounts and with such endorsements as the Title Policy, which policy shall be dated the date of completion of the Material Alteration and shall contain no exceptions other than Permitted Encumbrances; provided, however, that if, for any reason, Borrower is are unable to deliver the certification required by this clause (C) with respect to any costs or expenses relating to the Alteration(s) or Expansion(s), then, assuming Borrower is are able to satisfy each of the other requirements set forth in clauses (A) and (B) above, Borrower shall be entitled to the release of the difference between the whole balance of such Eligible Collateral and the total of all costs and expenses to which Borrower is are unable to certify; and (D) that to the Best of Borrower’s Knowledge and the knowledge of the certifying ~~Person~~person, no Event of Default has occurred and is continuing.

Appears in 1 contract

Samples: Loan and Security Agreement (Strategic Hotels & Resorts, Inc)

Alterations and Expansions. Borrower shall not perform or undertake or consent to ~~the performance~~ or ~~undertaking of~~ permit Operating Lessee or any other Person to perform or undertake any Alteration or Expansion, except in accordance with the following terms and conditions: (aA) The Alteration or Expansion shall be undertaken in accordance with the applicable provisions of this Agreement, the other Loan Documents, the Leases and all Legal Requirements. (bB) No Event of Default shall have occurred and be continuing or shall occur as a result of such action. (cC) A Material ~~Alteration or Material Expansion~~Alteration, to the extent architects are customarily used for alterations or expansions of those types, but including any structural change to any of the Property or the Improvements, shall be conducted under the supervision of an Independent Architect and shall not be undertaken until ten (10) Business Days after there shall have been filed with ~~Lender~~Administrative Agent, for information purposes only and not for approval by ~~Lender~~Administrative Agent, detailed plans and specifications and cost estimates therefor, prepared and approved in writing by such Independent Architect. Such plans and specifications may be revised at any time and from time to time, provided that revisions of such plans and specifications shall be filed with ~~Lender~~Administrative Agent, for information purposes only. (dD) The Alteration or Expansion may not in and of itself, either during the Alteration or Expansion or upon completion, be reasonably expected to have a Material Adverse Effect with respect to the ~~Property~~Property or, if a Cash Sweep Period then exists, adversely affect the annual Net Operating Income by more than $500,000, taking into account the required escrows (or completion bond) provided under clause (H)(i) below; provided that if, as reasonably determined by Administrative Agent, such Alteration or Expansion would reduce annual Net Operating Income by $500,000 or more and a Cash Sweep Period then exists, then in order to proceed with the Alteration or Expansion Borrower shall deliver to Lender Eligible Collateral in the amount that the projected reduction in Net Operating Income resulting from the Alteration or Expansion exceeds $500,000 as additional security for the Indebtedness, which Eligible Collateral shall be returned to Borrower after evidence of completion of the applicable Alteration or Expansion and no Event of Default has occurred and is continuing. (eE) All work done in connection with any Alteration or Expansion shall be performed with due diligence to Final Completion in a good and workmanlike manner, all materials used in connection with any Alteration or Expansion shall be not less than the standard of quality of the materials generally used at the Property as of the date hereof (or, if greater, the then-current customary quality in the sub-market in which the Property is located) and all work shall be performed and all materials used in accordance with all applicable Legal Requirements and Insurance Requirements. (fF) The cost of any Alteration or Expansion shall be promptly and fully paid for by Borrower, subject to the next succeeding sentence. No payment made prior to the Final Completion (excluding punch-list items) of an Alteration or Expansion or Restoration to any contractor, subcontractor, materialman, supplier, engineer, architect, project manager or other Person who renders services or furnishes materials in connection with such Alteration shall exceed ninety percent (90%) of the aggregate value of the work performed by such Person from time to time and materials furnished and incorporated into the Improvements. (gG) All work performed in connection with the (i) cure of ~~the Deferred Maintenance Conditions~~ any deferred maintenance conditions and (ii) remediation of any environmental conditions shall be performed in accordance with the terms and conditions set forth in clauses (aA), (cC), (eE) and (fF) of this Section 10.2. Subject to Section 10.2(F) above, from time to time as the cure or remediation of any particular deferred maintenance condition or environmental condition progresses, Administrative Agent shall, subject to and upon the satisfaction of the terms and conditions set forth in Section 16.4, disburse to Borrower from the Deferred Maintenance and Environmental Conditions Reserve Account, amounts incurred in connection with the cure or remediation of the Deferred Maintenance Condition or Environmental Condition in question. (hH) With respect to any Material ~~Alteration or Material Expansion~~Alteration: (i) Borrower shall have delivered to Lender Eligible Collateral in an amount equal to at least the total estimated remaining unpaid costs of such Material Alteration ~~or Material Expansion~~ which is in excess of the Threshold Amount, which Eligible Collateral shall be held by ~~Lender~~ Administrative Agent as security for the Indebtedness and released to Borrower as such work progresses in accordance with Section ~~10.2(h)(iii~~10.2(H)(iii); provided, however, in the event that any Material Alteration ~~or Material Expansion~~ shall be made in conjunction with any Restoration with respect to which Borrower shall be entitled to ~~use or apply~~ withdraw Proceeds pursuant to Section 6.2 hereof (including any Proceeds remaining after completion of such Restoration), the amount of the Eligible Collateral to be furnished pursuant hereto need not exceed the aggregate cost of such Restoration and such Material Alteration ~~or Material Expansion~~ (in either case, as estimated by the Independent Architect) less the sum of the amount of any Proceeds which ~~the~~ Borrower is entitled to withdraw pursuant to Section 6.2 hereof and the Threshold Amount; (ii) Prior to commencement of construction of such Material ~~Alteration or Material Expansion~~Alteration, Borrower shall deliver to ~~Lender~~ Administrative Agent a schedule (with the concurrence of the Independent Architect) setting forth the projected stages of completion of such Alteration or Expansion and the corresponding amounts expected to be due and payable by or on behalf of Borrower in connection with such completion, such schedule to be updated quarterly by Borrower (and with the concurrence of the Independent Architect) during the performance of such Alteration or Expansion. (iii) Any Eligible Collateral that a Borrower delivers to ~~Lender~~ Administrative Agent pursuant hereto (and the proceeds of any such Eligible Collateral) shall be invested (to the extent such Eligible Collateral can be invested) by ~~Lender~~ Administrative Agent in Permitted Investments for a period of time consistent with the date on which ~~the~~ Borrower notifies ~~Lender~~ Administrative Agent that ~~the~~ Borrower expects to request a release of such Eligible Collateral in accordance with the next succeeding sentence. From time to time as the Material Alteration ~~or Expansion~~ progresses, the amount of any Eligible Collateral so furnished may, upon the written request of Borrower to ~~Lender~~Administrative Agent, be withdrawn by Borrower and paid or otherwise applied by or returned to Borrower in an amount equal to the amount Borrower would be entitled to so withdraw if Section 6.2.4 were applicable, and any Eligible Collateral so furnished which is a Letter of Credit may be reduced by Borrower in an amount equal to the amount Borrower would be entitled to so reduce if Section 6.2.4 hereof were applicable, subject, in each case, subject to the satisfaction of the conditions precedent to withdrawal of funds ~~or reduction of the Letter of Credit~~ set forth in Section 6.2.4 hereof. In connection with the above-described quarterly update of the projected stages of completion of the Material Alteration ~~or Material Expansion~~ (as concurred with by an Independent Architect), Borrower shall increase (or be permitted to decrease, as applicable) the Eligible Collateral then deposited with ~~Lender~~ Administrative Agent as necessary to comply with Section ~~10.2(h)(i~~10.2(H)(i) hereof. (iv) At any time after Final Completion of such Material ~~Alterations or Material Expansions~~Alterations, the whole balance of any Cash deposited with ~~Lender~~ Administrative Agent pursuant to Section ~~10.2(h~~10.2(H) hereof then remaining on deposit may be withdrawn by Borrower and shall be paid by ~~Lender~~ Administrative Agent to Borrower, and any Eligible Collateral so deposited shall, to the extent it has not been called upon, reduced or theretofore released, be released by ~~Lender~~ Administrative Agent to Borrower, within ten (10) days after receipt by ~~Lender~~ Administrative Agent of an application for such withdrawal and/or release ~~together with~~ and satisfaction of each of the following conditions, as certified by an Officer’s ~~Certificate~~Certificate that such statements are true, and as to the following clauses (A1) and (B2) of this clause also a certificate of the Independent Architect~~, setting forth in substance as follows~~: (A1) that such Material Alteration(s) ~~or Material Expansion(s) has~~ shall have been completed in all material respects in accordance with any plans and specifications therefor previously filed with ~~Lender~~ Administrative Agent under Section ~~10.2(c~~10.2(C) hereof; (B2) that to the Best of Borrower’s Knowledge and the knowledge of the certifying ~~Person,~~ person (x) such Material Alteration(s~~) or Material Expansion(s~~) has been completed in compliance with all Legal Requirements, and (y) to the extent required for the legal use or occupancy of the portion of the Property affected by such Alteration(s) or Expansion(s), ~~the applicable~~ Borrower has obtained a temporary or permanent certificate of occupancy (or similar certificate) or, if no such certificate is required, a statement to that effect; (C3) that to the Best of Borrower’s Knowledge and the knowledge of the certifying ~~Person~~person, all amounts that a Borrower is or may become liable to pay in respect of such Material Alteration(s~~) or Material Expansion(s~~) through the date of the certification have been paid in full or adequately provided for and, to the extent that such are customary and reasonably obtainable by prudent property owners in the area where the applicable Property is located, that Lien waivers have been obtained from the general contractor and subcontractors performing such Alteration(s) or Expansion(s) or at its sole cost and expense, Borrower shall cause ~~a nationally recognized title insurance company~~ Title Company to deliver to ~~Lender~~ Administrative Agent an endorsement to the Title Policy, updating such policy and insuring over such Liens without further exceptions to such policy other than Permitted Encumbrances, or shall, at its sole cost and expense, cause ~~a reputable title insurance company~~ Title Company to deliver a lender’s title insurance policy, in such form, in such amounts and with such endorsements as the Title Policy, which policy shall be dated the date of completion of the Material Alteration and shall contain no exceptions other than Permitted Encumbrances; provided, however, that if, for any reason, Borrower is unable to deliver the certification required by this clause (C) with respect to any costs or expenses relating to the Alteration(s) or Expansion(s), then, assuming Borrower is able to satisfy each of the other requirements set forth in clauses (A1) and (B2) above, Borrower shall be entitled to the release of the difference between the whole balance of such Eligible Collateral and the total of all costs and expenses to which Borrower is are unable to certify; and (D4) that to the Best of Borrower’s Knowledge, and the knowledge of the certifying ~~Person~~person, no Event of Default has occurred and is continuing.

Appears in 1 contract

Samples: Loan and Security Agreement (Strategic Hotels & Resorts, Inc)

Alterations and Expansions. ~~Borrower shall not perform~~ Make or ~~undertake~~ permit any demolition, alteration, installation or ~~consent~~ improvement to any Real Property or any part thereof (an "Alteration") or materially expand or materially reduce any Real Property or the ~~performance or undertaking of any Alteration or~~ Tenant Improvements thereon (a "Expansion"), except in accordance with the following terms and conditions: (a) ~~The~~ such Alteration or Expansion shall be undertaken in accordance with the applicable provisions of this Agreement, the other Loan Documents, the Ground Leases, the Leases and ~~all Legal Requirements.~~Requirements of Law; (b) No no Event of Default shall have occurred and be continuing (except in the case of an Alteration that is required to cure an Event of Default or to comply with obligations under Ground Leases, the Leases or Requirements of Law) or shall occur as a result of such action.; (c) A Material Alteration or Material Expansion, to the extent architects are customarily used for alterations or expansions of those types, but including any structural change to any of the Property or the Improvements, shall be conducted under the supervision of an Independent Architect and shall not be undertaken until ten (10) Business Days after there shall have been filed with Lender, for information purposes only and not for approval by Lender, detailed plans and specifications and cost estimates therefor, prepared and approved in writing by such Independent Architect. Such plans and specifications may be revised at any time and from time to time, provided that revisions of such plans and specifications shall be filed with Lender, for information purposes only. (d) The Alteration or Expansion may not in and of itself, either during the Alteration or Expansion or upon completion, be reasonably expected to have a Material Adverse Effect with respect to the Property. (e) All all work done in connection with any Alteration or Expansion shall be performed with due diligence ~~to Final Completion~~ in a good and workmanlike manner, all materials used in connection with any Alteration or Expansion shall be new and not less than the standard of quality ~~of the materials generally used at the Property as of the date hereof (or~~a prudent owner would utilize, ~~if greater, the then-current customary quality in the sub-market in which the Property is located)~~ and all work shall be performed and all materials used in accordance with all applicable ~~Legal~~ Requirements of Law and ~~Insurance Requirements.~~insurance requirements. If at any time during any Alteration or Expansion the applicable Borrower decides not to complete such Alteration or Expansion, such Borrower shall obtain the approval of the Lender to such stoppage (which approval shall not be unreasonably withheld, conditioned or delayed); (fd) ~~The~~ the cost of any Alteration or Expansion shall be promptly and fully paid for by ~~Borrower,~~ the applicable Borrower or Property Affiliate or the Tenant or subtenant performing the Alteration or Expansion (subject to the ~~next succeeding sentence. No~~ right to contest in accordance with Section 5.4 hereof); (e) the Alteration or Expansion will not entitle any party to a Lease to terminate such Lease or otherwise give rise to any other rights of such parties (such as the right to terminate an operating covenant) that could have a Material Adverse Effect unless, in each case, the Lender consents thereto; (f) with respect to any material Alteration or material Expansion, the applicable Property Affiliate shall have delivered to the Lender any information related thereto reasonably requested by the Lender, and with respect to any material Alteration or material Expansion that is not provided for in the approved Business Plan, the Lender shall have approved such material Alteration or material Expansion (which approval shall not be unreasonably withheld, conditioned or delayed); and all revisions thereto shall likewise be subject to the approval of the Lender (which approval shall not be unreasonably withheld, conditioned or delayed); (g) to the extent practical and customary, no payment made prior to the ~~Final Completion (excluding punch-list items)~~ final completion of an such material Alteration or material Expansion ~~or Restoration~~ to any contractor, subcontractor, materialman, supplier, engineer, architect, project manager or other Person who renders services or furnishes materials in connection with such material Alteration or material Expansion shall be made without simultaneous receipt of Lien waivers or exceed ~~ninety~~ ninety-five percent (9095%) of the ~~aggregate~~ value of the work performed ~~by such Person~~ from time to time and materials furnished and incorporated into the Improvements. (g) All work performed in connection with the cure of the Deferred Maintenance Conditions shall be performed in accordance with the terms and conditions set forth in clauses (a), (c), (e) and (f) of this Section 10.2.improvements; and (h) ~~With respect to~~ in the case of any ~~Material~~ material Alteration or ~~Material~~ material Expansion: (i) Borrower shall have delivered to Lender Eligible Collateral in an amount equal to at least the total estimated remaining unpaid costs of such Material Alteration or Material Expansion which is in excess of the Threshold Amount, which Eligible Collateral shall be held by Lender as security for the Indebtedness and released to Borrower as such work progresses in accordance with Section 10.2(h)(iii); provided, however, in the event that any Material Alteration or Material Expansion shall be made in conjunction with any Restoration with respect to which Borrower shall be entitled to use or apply Proceeds pursuant to Section 6.2 hereof (including any Proceeds remaining after completion of such Restoration), the amount of the Eligible Collateral to be furnished pursuant hereto need not exceed the aggregate cost of such Restoration and such Material Alteration or Material Expansion (in either case, as estimated by the Independent Architect) less the sum of the amount of any Proceeds which the Borrower is entitled to withdraw pursuant to Section 6.2 hereof and the Threshold Amount; (ii) Prior to commencement of construction of such Material Alteration or Material Expansion, Borrower shall deliver to Lender a schedule (with the concurrence of the Independent Architect) setting forth the projected stages of completion of such Alteration or Expansion and the corresponding amounts expected to be due and payable by or on behalf of Borrower in connection with such completion, such schedule to be updated quarterly by Borrower (and with the concurrence of the Independent Architect) during the performance of such Alteration or Expansion. (iii) Any Eligible Collateral that a Borrower delivers to Lender pursuant hereto (and the proceeds of any such Eligible Collateral) shall be invested (to the extent such Eligible Collateral can be invested) by Lender in Permitted Investments for a period of time consistent with the date on which the Borrower notifies Lender that the Borrower expects to request a release of such Eligible Collateral in accordance with the next succeeding sentence. From time to time as the Alteration or Expansion progresses, the amount of any Eligible Collateral so furnished may, upon the written request of Borrower to Lender, be withdrawn by Borrower and paid or otherwise applied by or returned to Borrower in an amount equal to the amount Borrower would be entitled to so withdraw if Section 6.2.4 were applicable, and any Eligible Collateral so furnished which is a Letter of Credit may be reduced by Borrower in an amount equal to the amount Borrower would be entitled to so reduce if Section 6.2.4 hereof were applicable, subject, in each case, to the satisfaction of the conditions precedent to withdrawal of funds or reduction of the Letter of Credit set forth in Section 6.2.4 hereof. In connection with the above-described quarterly update of the projected stages of completion of the Material Alteration or Material Expansion (as concurred with by an Independent Architect), Borrower shall increase (or be permitted to decrease, as applicable) the Eligible Collateral then deposited with Lender as necessary to comply with Section 10.2(h)(i) hereof. (iv) At any time after Final Completion of such Material Alterations or Material Expansions, the whole balance of any Cash deposited with Lender pursuant to Section 10.2(h) hereof then remaining on deposit may be withdrawn by Borrower and shall be paid by Lender to Borrower, and any Eligible Collateral so deposited shall, to the extent it has not been called upon, reduced or theretofore released, be released by Lender to Borrower, within ten (10) days after receipt by Lender of an application for such withdrawal and/or release together with an Officer’s Certificate, and as to the following clauses (A) and (B) of this clause also a certificate of the Independent Architect, setting forth in substance as follows: (A) that such Material Alteration(s) or Material Expansion(s) has been completed in all material respects in accordance with any plans and specifications therefor previously filed with Lender under Section 10.2(c) hereof; (B) that to the knowledge of the certifying Person, (x) such Material Alteration(s) or Material Expansion(s) has been completed in compliance with all Legal Requirements, and (y) to the extent required for the legal use or occupancy of the portion of the Property affected by such Alteration(s) or Expansion(s), the applicable Borrower ~~has obtained a temporary~~ or ~~permanent certificate of occupancy (or similar certificate) or, if no such certificate is required, a statement to that effect; (C) that~~ Property Affiliate shall provide evidence satisfactory to the ~~knowledge of the certifying Person~~Lender, ~~all amounts that a Borrower is~~ in its discretion (which shall not be unreasonably withheld, conditioned or ~~may become liable to pay in respect of such Material Alteration(s) or Material Expansion(s) through the date of the certification have been paid in full or adequately provided for and~~delayed), ~~to the extent~~ that such ~~are customary and reasonably obtainable by prudent property owners in the area where the applicable~~ Borrower or Property ~~is located, that Lien waivers have been obtained from the general contractor and subcontractors performing~~ Affiliate has available to it sufficient funds to complete such ~~Alteration(s)~~ material Alteration or Expansion(s) or at its sole cost and expense, Borrower shall cause a nationally recognized title insurance company to deliver to Lender an endorsement to the Title Policy, updating such policy and insuring over such Liens without further exceptions to such policy other than Permitted Encumbrances, or shall, at its sole cost and expense, cause a reputable title insurance company to deliver a lender’s title insurance policy, in such form, in such amounts and with such endorsements as the Title Policy, which policy shall be dated the date of completion of the Material Alteration and shall contain no exceptions other than Permitted Encumbrances; provided, however, that if, for any reason, Borrower is unable to deliver the certification required by this clause (C) with respect to any costs or expenses relating to the Alteration(s) or Expansion(s), then, assuming Borrower is able to satisfy each of the other requirements set forth in clauses (A) and (B) above, Borrower shall be entitled to the release of the difference between the whole balance of such Eligible Collateral and the total of all costs and expenses to which Borrower is unable to certify; and (D) that to the knowledge of the certifying Person, no Event of Default has occurred and is continuingmaterial Expansion.

Appears in 1 contract

Samples: Credit Agreement (Frontline Capital Group)

Alterations and Expansions. (a) During the continuance of any Trigger Period or Event of Default, Borrower shall not perform or ~~undertake~~ contract to perform any capital improvements requiring Capital Expenditures that are not consistent with the Approved Annual Budget, except to the extent that (i) the performance of such capital improvements commenced prior to the Trigger Period or Event of Default, (ii) such capital improvements are required to prevent an imminent threat to the life or safety of Persons or prevent material damage to property or (iii) such capital improvements are required to be completed pursuant to a Lease. Borrower shall not perform, undertake, contract to perform or consent to any Material Alteration, except to the ~~performance or undertaking~~ extent required to do so pursuant to a Lease, without the prior written consent of Lender, which consent (in the absence of an Event of Default) shall not be unreasonably withheld. If the unpaid cost of any such Material Alteration approved by Lender shall be, in Lender’s reasonable judgment, in excess of $3,000,000 or ~~Expansion~~cause the aggregate cost of all Alterations ongoing at the Properties at such time to exceed 5% of the Principal Indebtedness, ~~except in accordance with~~ such consent may be conditioned on the ~~following terms and conditions:~~ delivery of additional collateral equal to such excess amount (~~a) The Alteration or Expansion shall be undertaken in accordance with the applicable provisions of this Agreement~~any such excess amount, ~~the other Loan Documents, the Leases and all Legal Requirements~~a “Material Alterations Deposit”). (b) No Any Material Alterations Deposit required by Lender hereunder shall be (i) in the form of (A) cash, (B) securities having a rating reasonably acceptable to Lender and in respect of which, at Lender’s option, the Rating Condition has been satisfied, (C) a completion and performance bond issued by a financial institution having a rating by S&P of not less than “A-1+” if the term of such bond is no longer than three months or, if such term is in excess of three months, issued by a financial institution having a rating that is reasonably acceptable to Lender and in respect of which, at Lender’s option, the Rating Condition has been satisfied, (D) a Letter of Credit (provided, however, that the aggregate amount of any Letters of Credit delivered to Lender under this Agreement shall not, at any one time, exceed an amount equal to 10% of the Principal Indebtedness, unless Borrower shall have delivered to Lender a nonconsolidation opinion substantially in the form of the Nonconsolidation Opinion, and otherwise reasonably acceptable to Lender, which takes into account all such Letters of Credit) or (E) a completion guaranty executed by Sponsor in favor of Lender pursuant to which Sponsor guarantees the payment of costs of the applicable Material Alterations in an amount equal to the required Material Alterations Deposit (such completion guaranty to be in form reasonably acceptable to Lender), (ii) reduced by any amounts to be paid or reimbursed by Tenants under the Leases with respect to the applicable Material Alteration and (iii) disbursed from time to time by Lender to Borrower for completion of the applicable Material Alterations upon the satisfaction of the following conditions: (1) Borrower shall submit a request for payment to Lender at least ten days prior to the date on which Borrower requests that such payment be made, which request for payment shall specify the Alterations for which payment is requested, (2) on the date such request is received by Lender and on the date such payment is to be made, no Event of Default shall ~~have occurred~~ be continuing, and (3) such request shall be ~~continuing or shall occur as a result of such action.~~ accompanied by an Officer’s Certificate (cx) ~~A Material Alteration or Material Expansion, to~~ stating that the ~~extent architects are customarily used for alterations or expansions of those types, but including any structural change to any~~ applicable portion of the ~~Property or~~ Material Alterations to be funded by the ~~Improvements, shall be conducted under the supervision of an Independent Architect and shall not be undertaken until ten (10) Business Days after there shall~~ requested disbursement have been ~~filed with Lender, for information purposes only and not for approval by Lender, detailed plans and specifications and cost estimates therefor, prepared and approved~~ completed in writing by such Independent Architect. Such plans and specifications may be revised at any time and from time to time, provided that revisions of such plans and specifications shall be filed with Lender, for information purposes only. (d) The Alteration or Expansion may not in and of itself, either during the Alteration or Expansion or upon completion, be reasonably expected to have a Material Adverse Effect with respect to the Property. (e) All work done in connection with any Alteration or Expansion shall be performed with due diligence to Final Completion in a good and workmanlike manner, all materials used in connection with any Alteration or Expansion shall be not less than the standard of quality of the materials generally used at the Property as of the date hereof (or, if greater, the then-current customary quality in the sub-market in which the Property is located) manner and ~~all work shall be performed and all materials used~~ in accordance with all applicable Legal ~~Requirements and Insurance~~ Requirements~~. (f) The cost of any Alteration or Expansion~~ , which Officer’s Certificate shall be ~~promptly and fully~~ accompanied by copies of paid ~~for by Borrower~~invoices, ~~subject to the next succeeding sentence. No payment made prior to the Final Completion~~ (~~excluding punch-list items~~y) ~~of an Alteration~~ identifying each contractor that supplied materials or ~~Expansion or Restoration to any contractor, subcontractor, materialman, supplier, engineer, architect, project manager or other Person who renders services or furnishes materials~~ labor in connection with ~~such Alteration shall exceed ninety percent (90%)~~ the applicable portion of the ~~aggregate value~~ Alterations to be funded by the requested disbursement and (z) stating that each such contractor has been paid in full upon such disbursement. Each Material Alterations Deposit shall be held by Lender in an interest-bearing account and, until disbursed in accordance with the provisions of this Section 6.13, shall constitute additional Collateral as security for the Indebtedness. Upon the completion of the Material Alterations in respect of which any Material Alterations Deposit is being held by Lender, Lender shall promptly return to Borrower any remaining portion of the Material Alterations Deposit upon the request of Borrower, provided that (I) on the date such request is received by Lender and on the date such disbursement is to be made, no Event of Default or Trigger Period shall be continuing, (II) such request shall be accompanied by an Officer’s Certificate stating that the Material Alterations have been fully completed in good and workmanlike manner and in accordance with all applicable Legal Requirements, which Officer’s Certificate shall be accompanied by copies of paid invoices (to the extent not received by Lender in connection with prior disbursement requests) and stating that each contractor providing services in connection with the Material Alterations has been paid in full and (III) Borrower shall have delivered lien releases and waivers from any contractors performing the Material Alterations, to the extent the cost of the work performed by any such ~~Person from time to time and materials furnished and incorporated into the Improvements. (g) All work performed in connection~~ contractor with ~~the cure of the Deferred Maintenance Conditions shall be performed in accordance with the terms and conditions set forth in clauses (a), (c), (e) and (f) of this Section 10.2. (h) With~~ respect to ~~any Material Alteration or Material Expansion: (i) Borrower shall have delivered to Lender Eligible Collateral in an amount equal to at least the total estimated remaining unpaid costs of~~ such Material Alteration ~~or Material Expansion which~~ is in excess of the Threshold Amount, which Eligible Collateral shall be held by Lender as security for the Indebtedness and released to Borrower as such work progresses in accordance with Section 10.2(h)(iii); provided, however, $250,000 in the ~~event that any Material Alteration~~ aggregate (whether such amount was disbursed to such contractor in a lump sum or ~~Material Expansion shall be made in conjunction with any Restoration~~ multiple installments). If Lender’s consent is requested hereunder with respect to ~~which~~ a Material Alteration, Lender may retain a construction consultant to review such request and, if such request is granted, Lender may retain a construction consultant to inspect the work from time to time. Borrower ~~shall be entitled to use or apply Proceeds pursuant to Section 6.2 hereof (including any Proceeds remaining after completion~~ shall, on written demand by Lender, reimburse Lender for the reasonable fees and disbursements of such Restoration), the amount of the Eligible Collateral to be furnished pursuant hereto need not exceed the aggregate cost of such Restoration and such Material Alteration or Material Expansion (in either case, as estimated by the Independent Architect) less the sum of the amount of any Proceeds which the Borrower is entitled to withdraw pursuant to Section 6.2 hereof and the Threshold Amount; (ii) Prior to commencement of construction of such Material Alteration or Material Expansion, Borrower shall deliver to Lender a schedule (with the concurrence of the Independent Architect) setting forth the projected stages of completion of such Alteration or Expansion and the corresponding amounts expected to be due and payable by or on behalf of Borrower in connection with such completion, such schedule to be updated quarterly by Borrower (and with the concurrence of the Independent Architect) during the performance of such Alteration or Expansionconsultant. (iii) Any Eligible Collateral that a Borrower delivers to Lender pursuant hereto (and the proceeds of any such Eligible Collateral) shall be invested (to the extent such Eligible Collateral can be invested) by Lender in Permitted Investments for a period of time consistent with the date on which the Borrower notifies Lender that the Borrower expects to request a release of such Eligible Collateral in accordance with the next succeeding sentence. From time to time as the Alteration or Expansion progresses, the amount of any Eligible Collateral so furnished may, upon the written request of Borrower to Lender, be withdrawn by Borrower and paid or otherwise applied by or returned to Borrower in an amount equal to the amount Borrower would be entitled to so withdraw if Section 6.2.4 were applicable, and any Eligible Collateral so furnished which is a Letter of Credit may be reduced by Borrower in an amount equal to the amount Borrower would be entitled to so reduce if Section 6.2.4 hereof were applicable, subject, in each case, to the satisfaction of the conditions precedent to withdrawal of funds or reduction of the Letter of Credit set forth in Section 6.2.4 hereof. In connection with the above-described quarterly update of the projected stages of completion of the Material Alteration or Material Expansion (as concurred with by an Independent Architect), Borrower shall increase (or be permitted to decrease, as applicable) the Eligible Collateral then deposited with Lender as necessary to comply with Section 10.2(h)(i) hereof. (iv) At any time after Final Completion of such Material Alterations or Material Expansions, the whole balance of any Cash deposited with Lender pursuant to Section 10.2(h) hereof then remaining on deposit may be withdrawn by Borrower and shall be paid by Lender to Borrower, and any Eligible Collateral so deposited shall, to the extent it has not been called upon, reduced or theretofore released, be released by Lender to Borrower, within ten (10) days after receipt by Lender of an application for such withdrawal and/or release together with an Officer’s Certificate, and as to the following clauses (A) and (B) of this clause also a certificate of the Independent Architect, setting forth in substance as follows: (A) that such Material Alteration(s) or Material Expansion(s) has been completed in all material respects in accordance with any plans and specifications therefor previously filed with Lender under Section 10.2(c) hereof; (B) that to the knowledge of the certifying Person, (x) such Material Alteration(s) or Material Expansion(s) has been completed in compliance with all Legal Requirements, and (y) to the extent required for the legal use or occupancy of the portion of the Property affected by such Alteration(s) or Expansion(s), the applicable Borrower has obtained a temporary or permanent certificate of occupancy (or similar certificate) or, if no such certificate is required, a statement to that effect; (C) that to the knowledge of the certifying Person, all amounts that a Borrower is or may become liable to pay in respect of such Material Alteration(s) or Material Expansion(s) through the date of the certification have been paid in full or adequately provided for and, to the extent that such are customary and reasonably obtainable by prudent property owners in the area where the applicable Property is located, that Lien waivers have been obtained from the general contractor and subcontractors performing such Alteration(s) or Expansion(s) or at its sole cost and expense, Borrower shall cause a nationally recognized title insurance company to deliver to Lender an endorsement to the Title Policy, updating such policy and insuring over such Liens without further exceptions to such policy other than Permitted Encumbrances, or shall, at its sole cost and expense, cause a reputable title insurance company to deliver a lender’s title insurance policy, in such form, in such amounts and with such endorsements as the Title Policy, which policy shall be dated the date of completion of the Material Alteration and shall contain no exceptions other than Permitted Encumbrances; provided, however, that if, for any reason, Borrower is unable to deliver the certification required by this clause (C) with respect to any costs or expenses relating to the Alteration(s) or Expansion(s), then, assuming Borrower is able to satisfy each of the other requirements set forth in clauses (A) and (B) above, Borrower shall be entitled to the release of the difference between the whole balance of such Eligible Collateral and the total of all costs and expenses to which Borrower is unable to certify; and (D) that to the knowledge of the certifying Person, no Event of Default has occurred and is continuing.

Appears in 1 contract

Samples: Loan Agreement (Brixmor Property Group Inc.)

Alterations and Expansions. During the continuance of a Cash Trap Period or Event of Default, Borrower shall not perform or ~~undertake or consent~~ contract to perform any Capital Expenditures that are not consistent with the ~~performance or undertaking of any Alteration or Expansion, except~~ Approved Capital Budget (as the same may be amended in accordance with the ~~following terms and conditions:~~ provisions hereof). Borrower shall not perform or contract to perform any Material Alteration without the prior written consent of Lender, which consent (~~a) The Alteration or Expansion shall be undertaken~~ in ~~accordance with~~ the ~~applicable provisions~~ absence of ~~this Agreement, the other Loan Documents, the Leases and all Legal Requirements. (b) No~~ an Event of ~~Default shall have occurred and be continuing or shall occur as a result of such action. (c~~Default) A Material Alteration or Material Expansion, to the extent architects are customarily used for alterations or expansions of those types, but including any structural change to any of the Property or the Improvements, shall be conducted under the supervision of an Independent Architect and shall not be ~~undertaken until ten~~ unreasonably withheld, and which consent shall be deemed given by Lender if (10A) ~~Business Days after there~~ Lender shall not have ~~been filed with Lender, for information purposes only and not for approval by Lender, detailed plans and specifications and cost estimates therefor, prepared and approved~~ notified the Borrower in writing by of its refusal to grant such ~~Independent Architect~~consent within the Material Alteration Approval Period (as hereinafter defined) after its receipt of a written request for such consent from Borrower and (B) the written request described in clause (A) shall prominently include a statement in capital letters "URGENT - LENDER'S ATTENTION REQUIRED WITHIN 10 BUSINESS DAYS". ~~Such plans and specifications~~ If Lender's consent is requested hereunder with respect to a Material Alteration, Lender may ~~be revised at any time and~~ retain a construction consultant to review such request and, if such request is granted, Lender may retain a construction consultant to inspect the work from time to time. Borrower shall, ~~provided that revisions~~ on demand by Lender, reimburse Lender for the reasonable fees and disbursements of such ~~plans and specifications~~ consultant. As used herein, "MATERIAL ALTERATION APPROVAL PERIODS" shall ~~be filed with~~ mean the 10 Business Day period following the Lender's receipt of Borrower's written request; PROVIDED, ~~for information purposes only. (d) The Alteration or Expansion~~ HOWEVER, that Lender may ~~not in and of itself, either during the Alteration or Expansion or upon completion, be reasonably expected to have a Material Adverse Effect with respect~~ by written notice given to the ~~Property.~~ Borrower within the initial 10 Business Day period extend the initial Material Alteration Approval Period for a reasonable time (~~e) All work done in connection with any Alteration or Expansion shall be performed with due diligence~~ not to Final Completion in a good and workmanlike manner, all materials used in connection with any Alteration or Expansion shall be not less than the standard of quality of the materials generally used at the Property as of the date hereof (or, if greater, the then-current customary quality in the sub-market in which the Property is located) and all work shall be performed and all materials used in accordance with all applicable Legal Requirements and Insurance Requirements. (f) The cost of any Alteration or Expansion shall be promptly and fully paid for by Borrowerexceed 30 days, subject to the next succeeding sentence. No payment made prior to the Final Completion (excluding punch-list items) of an Alteration or Expansion or Restoration to any contractor, subcontractor, materialman, supplier, engineer, architect, project manager or other Person who renders services or furnishes materials in connection with such Alteration shall exceed ninety percent (90%) reasonable extension by Lender if Lender is diligently pursuing its evaluation of the ~~aggregate value of the work performed by such Person from time to time and materials furnished and incorporated into the Improvements~~proposed Material Alteration). (g) All work performed in connection with the cure of the Deferred Maintenance Conditions shall be performed in accordance with the terms and conditions set forth in clauses (a), (c), (e) and (f) of this Section 10.2. (h) With respect to any Material Alteration or Material Expansion: (i) Borrower shall have delivered to Lender Eligible Collateral in an amount equal to at least the total estimated remaining unpaid costs of such Material Alteration or Material Expansion which is in excess of the Threshold Amount, which Eligible Collateral shall be held by Lender as security for the Indebtedness and released to Borrower as such work progresses in accordance with Section 10.2(h)(iii); provided, however, in the event that any Material Alteration or Material Expansion shall be made in conjunction with any Restoration with respect to which Borrower shall be entitled to use or apply Proceeds pursuant to Section 6.2 hereof (including any Proceeds remaining after completion of such Restoration), the amount of the Eligible Collateral to be furnished pursuant hereto need not exceed the aggregate cost of such Restoration and such Material Alteration or Material Expansion (in either case, as estimated by the Independent Architect) less the sum of the amount of any Proceeds which the Borrower is entitled to withdraw pursuant to Section 6.2 hereof and the Threshold Amount; (ii) Prior to commencement of construction of such Material Alteration or Material Expansion, Borrower shall deliver to Lender a schedule (with the concurrence of the Independent Architect) setting forth the projected stages of completion of such Alteration or Expansion and the corresponding amounts expected to be due and payable by or on behalf of Borrower in connection with such completion, such schedule to be updated quarterly by Borrower (and with the concurrence of the Independent Architect) during the performance of such Alteration or Expansion. (iii) Any Eligible Collateral that a Borrower delivers to Lender pursuant hereto (and the proceeds of any such Eligible Collateral) shall be invested (to the extent such Eligible Collateral can be invested) by Lender in Permitted Investments for a period of time consistent with the date on which the Borrower notifies Lender that the Borrower expects to request a release of such Eligible Collateral in accordance with the next succeeding sentence. From time to time as the Alteration or Expansion progresses, the amount of any Eligible Collateral so furnished may, upon the written request of Borrower to Lender, be withdrawn by Borrower and paid or otherwise applied by or returned to Borrower in an amount equal to the amount Borrower would be entitled to so withdraw if Section 6.2.4 were applicable, and any Eligible Collateral so furnished which is a Letter of Credit may be reduced by Borrower in an amount equal to the amount Borrower would be entitled to so reduce if Section 6.2.4 hereof were applicable, subject, in each case, to the satisfaction of the conditions precedent to withdrawal of funds or reduction of the Letter of Credit set forth in Section 6.2.4 hereof. In connection with the above-described quarterly update of the projected stages of completion of the Material Alteration or Material Expansion (as concurred with by an Independent Architect), Borrower shall increase (or be permitted to decrease, as applicable) the Eligible Collateral then deposited with Lender as necessary to comply with Section 10.2(h)(i) hereof. (iv) At any time after Final Completion of such Material Alterations or Material Expansions, the whole balance of any Cash deposited with Lender pursuant to Section 10.2(h) hereof then remaining on deposit may be withdrawn by Borrower and shall be paid by Lender to Borrower, and any Eligible Collateral so deposited shall, to the extent it has not been called upon, reduced or theretofore released, be released by Lender to Borrower, within ten (10) days after receipt by Lender of an application for such withdrawal and/or release together with an Officer’s Certificate, and as to the following clauses (A) and (B) of this clause also a certificate of the Independent Architect, setting forth in substance as follows: (A) that such Material Alteration(s) or Material Expansion(s) has been completed in all material respects in accordance with any plans and specifications therefor previously filed with Lender under Section 10.2(c) hereof; (B) that to the knowledge of the certifying Person, (x) such Material Alteration(s) or Material Expansion(s) has been completed in compliance with all Legal Requirements, and (y) to the extent required for the legal use or occupancy of the portion of the Property affected by such Alteration(s) or Expansion(s), the applicable Borrower has obtained a temporary or permanent certificate of occupancy (or similar certificate) or, if no such certificate is required, a statement to that effect; (C) that to the knowledge of the certifying Person, all amounts that a Borrower is or may become liable to pay in respect of such Material Alteration(s) or Material Expansion(s) through the date of the certification have been paid in full or adequately provided for and, to the extent that such are customary and reasonably obtainable by prudent property owners in the area where the applicable Property is located, that Lien waivers have been obtained from the general contractor and subcontractors performing such Alteration(s) or Expansion(s) or at its sole cost and expense, Borrower shall cause a nationally recognized title insurance company to deliver to Lender an endorsement to the Title Policy, updating such policy and insuring over such Liens without further exceptions to such policy other than Permitted Encumbrances, or shall, at its sole cost and expense, cause a reputable title insurance company to deliver a lender’s title insurance policy, in such form, in such amounts and with such endorsements as the Title Policy, which policy shall be dated the date of completion of the Material Alteration and shall contain no exceptions other than Permitted Encumbrances; provided, however, that if, for any reason, Borrower is unable to deliver the certification required by this clause (C) with respect to any costs or expenses relating to the Alteration(s) or Expansion(s), then, assuming Borrower is able to satisfy each of the other requirements set forth in clauses (A) and (B) above, Borrower shall be entitled to the release of the difference between the whole balance of such Eligible Collateral and the total of all costs and expenses to which Borrower is unable to certify; and (D) that to the knowledge of the certifying Person, no Event of Default has occurred and is continuing.

Appears in 1 contract

Samples: Loan Agreement (Las Vegas Sands Inc)

Alterations and Expansions. During the continuance of an Event of Default, Borrower shall not perform or ~~undertake or consent~~ contract to ~~the performance or undertaking of~~ perform any ~~Alteration or Expansion, except in accordance~~ Capital Expenditures that are not consistent with the ~~following terms and conditions:~~ Approved Annual Capital Expenditure Budget. Borrower shall not perform or contract to perform any Material Alteration without the prior written consent of Lender, which consent (~~a) The Alteration or Expansion shall be undertaken~~ in ~~accordance with~~ the ~~applicable provisions~~ absence of ~~this Agreement, the other Loan Documents, the Leases and all Legal Requirements. (b) No~~ an Event of ~~Default shall have occurred and be continuing or shall occur as a result of such action. (c~~Default) A Material Alteration or Material Expansion, to the extent architects are customarily used for alterations or expansions of those types, but including any structural change to any of the Property or the Improvements, shall be conducted under the supervision of an Independent Architect and shall not be ~~undertaken until ten (10)~~ unreasonably withheld, delayed or conditioned. Any request for Lender’s consent pursuant to this Section 6.13 shall be submitted to Lender in an envelope marked “URGENT – LENDER’S ATTENTION REQUIRED WITHIN 10 BUSINESS DAYS”, together with a detailed description of the request for which Lender’s consent is sought and any documentation needed for Lender to evaluate such request, and shall be deemed approved if Lender shall not have notified Borrower in writing of its disapproval thereof and the reasons for such disapproval within five Business Days after ~~there~~ Borrower shall have ~~been filed~~ given Lender written notice confirming that at least ten Business Days have elapsed since such submission, which written notice shall be submitted to Lender in an envelope marked “URGENT – SECOND AND FINAL NOTICE – LENDER’S ATTENTION REQUIRED BY [DATE]”). If Lender’s consent is requested hereunder with ~~Lender~~respect to a Material Alteration, ~~for information purposes only and not for approval by Lender~~Lender may retain a construction consultant reasonably acceptable to Borrower to review such request and, ~~detailed plans and specifications and cost estimates therefor~~if such request is granted, ~~prepared and approved in writing by such Independent Architect. Such plans and specifications~~ Lender may ~~be revised at any time and~~ retain a construction consultant reasonably acceptable to Borrower to inspect the work from time to time. Borrower shall, ~~provided that revisions~~ on demand by Lender, reimburse Lender for the reasonable fees and disbursements of such ~~plans and specifications shall be filed with Lender, for information purposes only~~consultant. (d) The Alteration or Expansion may not in and of itself, either during the Alteration or Expansion or upon completion, be reasonably expected to have a Material Adverse Effect with respect to the Property. (e) All work done in connection with any Alteration or Expansion shall be performed with due diligence to Final Completion in a good and workmanlike manner, all materials used in connection with any Alteration or Expansion shall be not less than the standard of quality of the materials generally used at the Property as of the date hereof (or, if greater, the then-current customary quality in the sub-market in which the Property is located) and all work shall be performed and all materials used in accordance with all applicable Legal Requirements and Insurance Requirements. (f) The cost of any Alteration or Expansion shall be promptly and fully paid for by Borrower, subject to the next succeeding sentence. No payment made prior to the Final Completion (excluding punch-list items) of an Alteration or Expansion or Restoration to any contractor, subcontractor, materialman, supplier, engineer, architect, project manager or other Person who renders services or furnishes materials in connection with such Alteration shall exceed ninety percent (90%) of the aggregate value of the work performed by such Person from time to time and materials furnished and incorporated into the Improvements. (g) All work performed in connection with the cure of the Deferred Maintenance Conditions shall be performed in accordance with the terms and conditions set forth in clauses (a), (c), (e) and (f) of this Section 10.2. (h) With respect to any Material Alteration or Material Expansion: (i) Borrower shall have delivered to Lender Eligible Collateral in an amount equal to at least the total estimated remaining unpaid costs of such Material Alteration or Material Expansion which is in excess of the Threshold Amount, which Eligible Collateral shall be held by Lender as security for the Indebtedness and released to Borrower as such work progresses in accordance with Section 10.2(h)(iii); provided, however, in the event that any Material Alteration or Material Expansion shall be made in conjunction with any Restoration with respect to which Borrower shall be entitled to use or apply Proceeds pursuant to Section 6.2 hereof (including any Proceeds remaining after completion of such Restoration), the amount of the Eligible Collateral to be furnished pursuant hereto need not exceed the aggregate cost of such Restoration and such Material Alteration or Material Expansion (in either case, as estimated by the Independent Architect) less the sum of the amount of any Proceeds which the Borrower is entitled to withdraw pursuant to Section 6.2 hereof and the Threshold Amount; (ii) Prior to commencement of construction of such Material Alteration or Material Expansion, Borrower shall deliver to Lender a schedule (with the concurrence of the Independent Architect) setting forth the projected stages of completion of such Alteration or Expansion and the corresponding amounts expected to be due and payable by or on behalf of Borrower in connection with such completion, such schedule to be updated quarterly by Borrower (and with the concurrence of the Independent Architect) during the performance of such Alteration or Expansion. (iii) Any Eligible Collateral that a Borrower delivers to Lender pursuant hereto (and the proceeds of any such Eligible Collateral) shall be invested (to the extent such Eligible Collateral can be invested) by Lender in Permitted Investments for a period of time consistent with the date on which the Borrower notifies Lender that the Borrower expects to request a release of such Eligible Collateral in accordance with the next succeeding sentence. From time to time as the Alteration or Expansion progresses, the amount of any Eligible Collateral so furnished may, upon the written request of Borrower to Lender, be withdrawn by Borrower and paid or otherwise applied by or returned to Borrower in an amount equal to the amount Borrower would be entitled to so withdraw if Section 6.2.4 were applicable, and any Eligible Collateral so furnished which is a Letter of Credit may be reduced by Borrower in an amount equal to the amount Borrower would be entitled to so reduce if Section 6.2.4 hereof were applicable, subject, in each case, to the satisfaction of the conditions precedent to withdrawal of funds or reduction of the Letter of Credit set forth in Section 6.2.4 hereof. In connection with the above-described quarterly update of the projected stages of completion of the Material Alteration or Material Expansion (as concurred with by an Independent Architect), Borrower shall increase (or be permitted to decrease, as applicable) the Eligible Collateral then deposited with Lender as necessary to comply with Section 10.2(h)(i) hereof. (iv) At any time after Final Completion of such Material Alterations or Material Expansions, the whole balance of any Cash deposited with Lender pursuant to Section 10.2(h) hereof then remaining on deposit may be withdrawn by Borrower and shall be paid by Lender to Borrower, and any Eligible Collateral so deposited shall, to the extent it has not been called upon, reduced or theretofore released, be released by Lender to Borrower, within ten (10) days after receipt by Lender of an application for such withdrawal and/or release together with an Officer’s Certificate, and as to the following clauses (A) and (B) of this clause also a certificate of the Independent Architect, setting forth in substance as follows: (A) that such Material Alteration(s) or Material Expansion(s) has been completed in all material respects in accordance with any plans and specifications therefor previously filed with Lender under Section 10.2(c) hereof; (B) that to the knowledge of the certifying Person, (x) such Material Alteration(s) or Material Expansion(s) has been completed in compliance with all Legal Requirements, and (y) to the extent required for the legal use or occupancy of the portion of the Property affected by such Alteration(s) or Expansion(s), the applicable Borrower has obtained a temporary or permanent certificate of occupancy (or similar certificate) or, if no such certificate is required, a statement to that effect; (C) that to the knowledge of the certifying Person, all amounts that a Borrower is or may become liable to pay in respect of such Material Alteration(s) or Material Expansion(s) through the date of the certification have been paid in full or adequately provided for and, to the extent that such are customary and reasonably obtainable by prudent property owners in the area where the applicable Property is located, that Lien waivers have been obtained from the general contractor and subcontractors performing such Alteration(s) or Expansion(s) or at its sole cost and expense, Borrower shall cause a nationally recognized title insurance company to deliver to Lender an endorsement to the Title Policy, updating such policy and insuring over such Liens without further exceptions to such policy other than Permitted Encumbrances, or shall, at its sole cost and expense, cause a reputable title insurance company to deliver a lender’s title insurance policy, in such form, in such amounts and with such endorsements as the Title Policy, which policy shall be dated the date of completion of the Material Alteration and shall contain no exceptions other than Permitted Encumbrances; provided, however, that if, for any reason, Borrower is unable to deliver the certification required by this clause (C) with respect to any costs or expenses relating to the Alteration(s) or Expansion(s), then, assuming Borrower is able to satisfy each of the other requirements set forth in clauses (A) and (B) above, Borrower shall be entitled to the release of the difference between the whole balance of such Eligible Collateral and the total of all costs and expenses to which Borrower is unable to certify; and (D) that to the knowledge of the certifying Person, no Event of Default has occurred and is continuing.

Appears in 1 contract

Samples: Loan Agreement (American Casino & Entertainment Properties LLC)

Alterations and Expansions. During the continuance of any Cash Flow Sweep Period or Event of Default, Borrower shall not ~~perform~~ incur or ~~undertake or consent~~ contract to ~~the performance or undertaking of~~ incur any ~~Alteration or Expansion, except in accordance~~ capital improvements requiring Capital Expenditures that are not consistent with the ~~following terms and conditions:~~ Approved Annual Budget (~~a) The Alteration or Expansion shall~~ it being understood that Borrower may complete all capital improvements required to be ~~undertaken in accordance with the applicable provisions of this Agreement, the other Loan Documents, the~~ made under Leases and all Legal Requirements. (b) No Event of Default shall have occurred and be continuing or shall occur as a result of such action. (c) A Material Alteration or Material Expansion, to the extent architects are customarily used for alterations or expansions of those types, but including any structural change to any of the Property or the Improvements, shall be conducted under the supervision of an Independent Architect and shall not be undertaken until ten (10) Business Days after there shall have been filed with Lender, for information purposes only and not for approval by Lender, detailed plans and specifications and cost estimates therefor, prepared and approved in writing by such Independent Architect. Such plans and specifications may be revised at any time and from time to time, provided that revisions of such plans and specifications shall be filed with Lender, for information purposes only. (d) The Alteration or Expansion may not in and of itself, either during the Alteration or Expansion or upon completion, be reasonably expected to have a Material Adverse Effect with respect to the Property. (e) All work done in connection with any Alteration or Expansion shall be performed with due diligence to Final Completion in a good and workmanlike manner, all materials used in connection with any Alteration or Expansion shall be not less than the standard of quality of the materials generally used at the Property as of the date hereof (or, if greater, the then-current customary quality in the sub-market in which the Property is located) and all work shall be performed and all materials used in accordance with all applicable Legal Requirements and Insurance Requirements. (f) The cost of any Alteration or Expansion shall be promptly and fully paid for by Borrower, subject to the next succeeding sentence. No payment made prior to the Final Completion (excluding punch-list items) of an Alteration or Expansion or Restoration to any contractor, subcontractor, materialman, supplier, engineer, architect, project manager or other Person who renders services or furnishes materials in connection with such Alteration shall exceed ninety percent (90%) of the aggregate value of the work performed by such Person from time to time and materials furnished and incorporated entered into ~~the Improvements. (g) All work performed in connection with the cure of the Deferred Maintenance Conditions shall be performed~~ in accordance with the terms ~~and conditions set forth in clauses (a), (c), (e) and (f)~~ of this ~~Section 10.2. (h) With respect~~ Agreement). Borrower shall not perform, undertake, contract to perform or consent to any Material Alteration ~~or Material Expansion: (i) Borrower shall have delivered to Lender Eligible Collateral in an amount equal to at least~~ without the ~~total estimated remaining unpaid costs~~ prior written consent of ~~such Material Alteration or Material Expansion which is in excess of the Threshold Amount~~Lender, which ~~Eligible Collateral~~ consent (in the absence of a Cash Flow Sweep Period or an Event of Default) shall not be ~~held by Lender as security for~~ unreasonably withheld, delayed or conditioned, but may be conditioned on the ~~Indebtedness and released~~ delivery of additional collateral in the form of cash or cash equivalents acceptable to ~~Borrower as such work progresses in accordance with Section 10.2(h)(iii)~~Lender; provided, ~~however~~that, if the cost of the Material Alteration does not exceed $27,000,000.00 (in the aggregate), in lieu of delivering cash collateral Guarantor may execute and deliver a completion guaranty in form and substance acceptable to Lender and Guarantor pursuant to which Guarantor will guaranty the completion of the Material Alteration on the terms set forth in the completion guaranty. If Lender’s consent is requested hereunder with respect to a Material Alteration, Lender may retain a construction consultant to review such request and, if such request is granted, Lender may retain a construction consultant to inspect the work from time to time. Borrower shall, on demand by Lender, reimburse Lender for the reasonable fees and disbursements of such consultant. Notwithstanding the foregoing, in the event that Borrower is required to perform and/or pay the cost of any ~~Material Alteration or Material Expansion~~ renovation of the retail atrium located between the Property and that certain property commonly known as Xxxxx Fargo Center – North and located at 000 Xxxxx Xxxxx Xxxxxx, Xxx Xxxxxxx, Xxxxxxxxxx, Lender’s consent shall be made in conjunction with any Restoration with respect to which Borrower shall be entitled to use or apply Proceeds pursuant to Section 6.2 hereof (including any Proceeds remaining after completion of such Restoration), the amount of the Eligible Collateral to be furnished pursuant hereto need not exceed the aggregate cost of such Restoration and such Material Alteration or Material Expansion (in either case, as estimated by the Independent Architect) less the sum of the amount of any Proceeds which the Borrower is entitled to withdraw pursuant to Section 6.2 hereof and the Threshold Amount; (ii) Prior to commencement of construction of such Material Alteration or Material Expansion, Borrower shall deliver to Lender a schedule (with the concurrence of the Independent Architect) setting forth the projected stages of completion of such Alteration or Expansion and the corresponding amounts expected to be due and payable by or on behalf of Borrower in connection with such completion, such schedule to be updated quarterly by Borrower (and with the concurrence of the Independent Architect) during the performance of such Alteration or Expansion. (iii) Any Eligible Collateral that a Borrower delivers to Lender pursuant hereto (and the proceeds of required for any such ~~Eligible Collateral) shall be invested (to the extent such Eligible Collateral can be invested)~~ payment or performance by Lender in Permitted Investments for a period of time consistent with the date on which the Borrower notifies Lender that the Borrower expects to request a release of such Eligible Collateral in accordance with the next succeeding sentence. From time to time as the Alteration or Expansion progresses, the amount of any Eligible Collateral so furnished may, upon the written request of Borrower to Lender, be withdrawn by Borrower and paid or otherwise applied by or returned to Borrower in an amount equal to the amount Borrower would be entitled to so withdraw if Section 6.2.4 were applicable, and any Eligible Collateral so furnished which is a Letter of Credit may be reduced by Borrower in an amount equal to the amount Borrower would be entitled to so reduce if Section 6.2.4 hereof were applicable, subject, in each case, to the satisfaction of the conditions precedent to withdrawal of funds or reduction of the Letter of Credit set forth in Section 6.2.4 hereof. In connection with the above-described quarterly update of the projected stages of completion of the Material Alteration or Material Expansion (as concurred with by an Independent Architect), Borrower shall increase (or be permitted to decrease, as applicable) the Eligible Collateral then deposited with Lender as necessary to comply with Section 10.2(h)(i) hereof. (iv) At any time after Final Completion of such Material Alterations or Material Expansions, the whole balance of any Cash deposited with Lender pursuant to Section 10.2(h) hereof then remaining on deposit may be withdrawn by Borrower and shall be paid by Lender to Borrower, ~~and any Eligible Collateral so deposited shall~~which consent shall not be unreasonably withheld, ~~to the extent it has not been called upon, reduced~~ conditioned or theretofore released, be released by Lender to Borrower, within ten (10) days after receipt by Lender of an application for such withdrawal and/or release together with an Officer’s Certificate, and as to the following clauses (A) and (B) of this clause also a certificate of the Independent Architect, setting forth in substance as follows: (A) that such Material Alteration(s) or Material Expansion(s) has been completed in all material respects in accordance with any plans and specifications therefor previously filed with Lender under Section 10.2(c) hereof; (B) that to the knowledge of the certifying Person, (x) such Material Alteration(s) or Material Expansion(s) has been completed in compliance with all Legal Requirements, and (y) to the extent required for the legal use or occupancy of the portion of the Property affected by such Alteration(s) or Expansion(s), the applicable Borrower has obtained a temporary or permanent certificate of occupancy (or similar certificate) or, if no such certificate is required, a statement to that effect; (C) that to the knowledge of the certifying Person, all amounts that a Borrower is or may become liable to pay in respect of such Material Alteration(s) or Material Expansion(s) through the date of the certification have been paid in full or adequately provided for and, to the extent that such are customary and reasonably obtainable by prudent property owners in the area where the applicable Property is located, that Lien waivers have been obtained from the general contractor and subcontractors performing such Alteration(s) or Expansion(s) or at its sole cost and expense, Borrower shall cause a nationally recognized title insurance company to deliver to Lender an endorsement to the Title Policy, updating such policy and insuring over such Liens without further exceptions to such policy other than Permitted Encumbrances, or shall, at its sole cost and expense, cause a reputable title insurance company to deliver a lender’s title insurance policy, in such form, in such amounts and with such endorsements as the Title Policy, which policy shall be dated the date of completion of the Material Alteration and shall contain no exceptions other than Permitted Encumbrances; provided, however, that if, for any reason, Borrower is unable to deliver the certification required by this clause (C) with respect to any costs or expenses relating to the Alteration(s) or Expansion(s), then, assuming Borrower is able to satisfy each of the other requirements set forth in clauses (A) and (B) above, Borrower shall be entitled to the release of the difference between the whole balance of such Eligible Collateral and the total of all costs and expenses to which Borrower is unable to certify; and (D) that to the knowledge of the certifying Person, no Event of Default has occurred and is continuingdelayed.

Appears in 1 contract

Samples: Loan Agreement (Brookfield DTLA Fund Office Trust Investor Inc.)

Alterations and Expansions. ~~Borrower shall not~~ No Issuer or Operating Lessee will perform or undertake or consent to the performance or undertaking of (including, without limitation, the approval of any budget with respect to a Property which includes) any Alteration or Expansion, except in accordance with the following terms and conditions: (a) The Alteration or Expansion shall be undertaken in accordance with the applicable provisions of this ~~Agreement~~Indenture, the other ~~Loan~~ Transaction Documents, the ~~Leases~~ Property Management Agreements, the Operating Agreements and the Leases, and all Legal Requirements. (b) No Event of Default shall have occurred and be continuing or shall occur as a result of such action. (c) A Material Alteration or Material Expansion, to the extent architects are customarily used for alterations or expansions of those types, but including any structural change to any of the ~~Property~~ Properties or the Improvements, shall be conducted under the supervision of an Independent Architect and shall not be undertaken until ten (10) Business Days after there shall have been filed with ~~Lender~~Note Trustee, for information purposes only and not for approval by ~~Lender~~Note Trustee, detailed plans and specifications and cost estimates therefor, prepared and approved in writing by such Independent Architect. Such plans and specifications may be revised at any time and from time to time, provided that revisions of such plans and specifications shall be filed with ~~Lender~~Note Trustee, for information purposes only.. 118 (d) The Alteration or Expansion may not in and of itself, either during the Alteration or Expansion or upon completion, be reasonably expected to have a Material Adverse Effect with respect to a Property or adversely affect the ~~Property~~annual Net Operating Income, taking into account the required escrows (or completion bond) provided under Section 7.1(h)(i) below; provided that if, as reasonably determined by the Note Trustee, such Alteration or Expansion would adversely affect the annual Net Operating Income, then in order to proceed with the Alteration or Expansion the Issuers shall deliver to Note Trustee Eligible Collateral in the total amount of the estimated reduction in Net Operating Income resulting from the Alteration or Expansion as additional security for the Debt. On each Payment Date during the period in which such Alteration or Expansion is being performed, Note Trustee shall release a portion of such Eligible Collateral to Issuer in an amount equal to the estimated reduction in the Net Operating Income resulting from the Alteration or Expansion for the month in which the Payment Date occurs. Any remaining Eligible Collateral shall be returned to Issuers after completion of the Alteration or Expansion if the reduction in Net Operating Income has been restored and no Event of Default has occurred and is continuing. (e) All work done in connection with any Alteration or Expansion shall be performed with due diligence to Final Completion in a good and workmanlike manner, all materials used in connection with any Alteration or Expansion shall be not less than the standard of quality of the materials generally used at the applicable Property as of the date hereof (or, if greater, the then-current customary quality in the ~~sub-market~~ submarket in which ~~the~~ such Property is located) and all work shall be performed and all materials used in accordance with all applicable Legal Requirements and Insurance Requirements. (f) The cost of any Alteration or Expansion shall be promptly and fully paid for by ~~Borrower~~Issuers, subject to the next succeeding sentence. No payment made prior to the Final Completion ~~(excluding punch-list items)~~ of an Alteration or Expansion or Restoration to any contractor, subcontractor, materialman, supplier, engineer, architect, project manager or other Person who renders services or furnishes materials in connection with such Alteration shall exceed ninety percent (90%) (other than with respect to FF&E for which Issuer may make payments in full prior to Final Completion if it has received delivery of such items and otherwise has complied with the terms of Section 9.2.16) of the aggregate value of the work performed by such Person from time to time and materials furnished and incorporated into the Improvements. (g) All work performed in connection with the (i) cure of the Deferred Maintenance Conditions and (ii) remediation of the Environmental Conditions shall be performed in accordance with the terms and conditions set forth in clauses (a), (c), (e) and (f) of this Section ~~10.2~~7. 1. Subject to Section 7.1(f) above, from time to time as the cure or remediation of any particular Deferred Maintenance Condition or Environmental Condition progresses, Note Trustee shall, subject to and upon the satisfaction of the terms and conditions set forth in Section 9.2.2 herein, disburse to Issuers from the Deferred Maintenance and Environmental Conditions Reserve Account, amounts incurred by Issuers in connection with the cure or remediation of the Deferred Maintenance Condition or Environmental Condition in question. 119 (h) With respect to any Material Alteration or Material Expansion: (i) ~~Borrower~~ Issuers shall have delivered to ~~Lender~~ Note Trustee Eligible Collateral in an amount equal to at least the total estimated remaining unpaid costs of such Material Alteration or Material Expansion which ~~is in excess of the Threshold Amount, which~~ Eligible Collateral shall be held by ~~Lender~~ Note Trustee as security for the ~~Indebtedness~~ Debt and released to ~~Borrower~~ the applicable Issuer as such work progresses in accordance with Section ~~10.2(h)(iii)~~7.1(h)(iii) hereof; provided, however, in the event that any Material Alteration or Material Expansion shall be made in conjunction with any Restoration with respect to which ~~Borrower~~ an Issuer shall be entitled to ~~use or apply~~ withdraw Proceeds pursuant to Section ~~6.2~~ 8.1.2(b) hereof (including any Proceeds remaining after completion of such Restoration), the amount of the Eligible Collateral to be furnished pursuant hereto need not exceed the aggregate cost of such Restoration and such Material Alteration or Material Expansion (in either case, as estimated by the Independent Architect) less the sum of the amount of any Proceeds which ~~the Borrower~~ any Issuer is entitled to withdraw pursuant to Section ~~6.2 hereof and the Threshold Amount~~8.1 hereof; (ii) Prior to commencement of construction of such Material Alteration or Material Expansion, ~~Borrower~~ Issuers shall deliver to ~~Lender~~ Note Trustee a schedule (with the concurrence of the Independent Architect) setting forth the projected stages of completion of such Alteration or Expansion and the corresponding amounts expected to be due and payable by or on behalf of ~~Borrower~~ Issuers in connection with such completion, such schedule to be updated quarterly by ~~Borrower~~ Issuers (and with the concurrence of the Independent Architect) during the performance of such Alteration or Expansion. (iii) Any Eligible Collateral that ~~a Borrower~~ an Issuer delivers to ~~Lender~~ Note Trustee pursuant hereto (and the proceeds of any such Eligible Collateral) shall be invested (to the extent such Eligible Collateral can be invested) by ~~Lender~~ Note Trustee in Permitted Investments for a period of time consistent with the date on which ~~the Borrower~~ such Issuer notifies ~~Lender~~ Note Trustee that ~~the Borrower~~ such Issuer expects to request a release of such Eligible Collateral in accordance with the next succeeding sentence. From time to time as the Alteration or Expansion progresses, the amount of any Eligible Collateral so furnished may, upon the written request of ~~Borrower~~ any Issuer to ~~Lender~~Note Trustee, be withdrawn by ~~Borrower~~ Issuers and paid or otherwise applied by or returned to ~~Borrower~~ Issuers in an amount equal to the amount ~~Borrower~~ Issuers would be entitled to so withdraw if Section ~~6.2.4~~ 8.1.2(e) hereof were applicable, and any Eligible Collateral so furnished which is a ~~Letter of~~ Credit Facility may be reduced by ~~Borrower~~ Issuers in an amount equal to the amount ~~Borrower~~ Issuers would be entitled to so reduce if Section ~~6.2.4~~ 8.1.2(e) hereof were applicable, subject, in each case, to the satisfaction of the conditions precedent to withdrawal of funds or reduction of the ~~Letter of~~ Credit Facility set forth in Section ~~6.2.4~~ 8.1.2(e) hereof, provided however that, notwithstanding the terms of Section 8.1.2(e), instead of reimbursing Issuers for amounts already paid in respect of such Alteration or Expansion, Eligible Collateral shall be disbursed to Issuer or, at Note Trustee's election, the applicable contractor upon presentation to Note Trustee of a draw request together with copies of invoices for the amounts to be withdrawn. In connection with the above-described quarterly update of the projected stages of completion of the Material Alteration or Material Expansion (as concurred with by an Independent Architect), ~~Borrower~~ Issuers shall increase (or be permitted to decrease, as applicable) the Eligible Collateral then deposited with ~~Lender~~ Note Trustee as necessary to comply with Section ~~10.2(h)(i~~7.1(h)(i) hereof. (iv) At any time after Final Completion of such ~~Material~~ Alterations or ~~Material~~ Expansions, the whole balance of any Cash deposited with ~~Lender~~ Note Trustee pursuant to Section ~~10.2(h~~7.1(h) hereof then remaining on deposit may be withdrawn by ~~Borrower~~ Issuers and shall be paid by ~~Lender~~ Note Trustee to ~~Borrower~~Issuers, and any Eligible Collateral so deposited shall, to the extent it has not been called upon, reduced or theretofore released, be released by ~~Lender~~ Note Trustee to ~~Borrower~~Issuers, within ten (10) days after receipt by ~~Lender~~ Note Trustee of an application for such withdrawal and/or release together with an Officer’s 's Certificate, and as to the following clauses (A) and (B) of this clause also a certificate of the Independent Architect, setting forth in substance as follows: (A) that such ~~Material~~ Alteration(s) or ~~Material~~ Expansion(s) has been completed in all material respects in accordance with any plans and specifications therefor previously filed with ~~Lender~~ Note Trustee under Section ~~10.2(c~~7.1(c) hereof; (B) that to the knowledge of the certifying Person, (x) such ~~Material~~ Alteration(s) or ~~Material~~ Expansion(s) has been completed in compliance with all Legal Requirements, and (y) to the extent required for the legal use or occupancy of the portion of the Property affected by such Alteration(s) or Expansion(s), the applicable ~~Borrower~~ Issuer has obtained a temporary or permanent certificate of occupancy (or similar certificate) or, if no such certificate is required, a statement to that effect; (C) that to the knowledge of the certifying Person, all amounts that ~~a Borrower~~ an Issuer is or may become liable to pay in respect of such ~~Material~~ Alteration(s) or ~~Material~~ Expansion(s) through the date of the certification have been paid in full or adequately provided for and, to the extent that such are customary and reasonably obtainable by prudent property owners in the area where the applicable Property is located, that Lien waivers have been obtained from the general contractor and subcontractors performing such Alteration(s) or Expansion(s) or at its sole cost and expense, ~~Borrower~~ Issuers shall cause a nationally recognized title insurance company to deliver to ~~Lender~~ Note Trustee an endorsement to the Qualified Title Policy, updating such policy and insuring over such Liens without further exceptions to such policy other than Permitted Encumbrances, or shall, at its sole cost and expense, cause a reputable title insurance company to deliver a lender’s 's title insurance policy, in such form, in such amounts and with such endorsements as the Qualified Title Policy, which policy shall be dated the date of completion of the Material Alteration and shall contain no exceptions other than Permitted Encumbrances; provided, however, that if, for any reason, ~~Borrower is~~ Issuers are unable to deliver the certification required by this clause (C) with respect to any costs or expenses relating to the Alteration(s) or Expansion(s), then, assuming ~~Borrower is~~ Issuers are able to satisfy each of the other requirements set forth in clauses (A) and (B) above, ~~Borrower~~ Issuers shall be entitled to the release of the difference between the whole balance of such Eligible Collateral and the total of all costs and expenses to which ~~Borrower is~~ Issuers are unable to certify; and (D) that to the knowledge of the certifying Person, no Event of Default has occurred and is continuing.

Appears in 1 contract

Samples: Indenture (Strategic Hotel Capital Inc)

Alterations and Expansions. Borrower shall not perform or undertake or consent to ~~the performance~~ or ~~undertaking of~~ permit any other Person to perform or undertake any Alteration or Expansion, except in accordance with the following terms and conditions: (aA) The Alteration or Expansion shall be undertaken in accordance with the applicable provisions of this Agreement, the other Loan Documents, the Leases and all Legal Requirements. (bB) No Event of Default shall have occurred and be continuing or shall occur as a result of such action. (cC) A Material ~~Alteration or Material Expansion~~Alteration, to the extent architects are customarily used for alterations or expansions of those types, but including any structural change to any of the Property or the Improvements, shall be conducted under the supervision of an Independent Architect and shall not be undertaken until ten (10) Business Days after there shall have been filed with ~~Lender~~Administrative Agent, for information purposes only and not for approval by ~~Lender~~Administrative Agent, detailed plans and specifications and cost estimates therefor, prepared and approved in writing by such Independent Architect. Such plans and specifications may be revised at any time and from time to time, provided that revisions of such plans and specifications shall be filed with ~~Lender~~Administrative Agent, for information purposes only. (dD) The Alteration or Expansion may not in and of itself, either during the Alteration or Expansion or upon completion, be reasonably expected to have a Material Adverse Effect with respect to the ~~Property~~Property or, if a Cash Sweep Period then exists, adversely affect the annual Net Operating Income by more than $500,000, taking into account the required escrows (or completion bond) provided under clause (h)(i) below; provided that if, as reasonably determined by Borrower in good faith, such Alteration or Expansion would reduce annual Net Operating Income by $500,000 or more and a Cash Sweep Period then exists, then in order to proceed with the Alteration or Expansion Borrower shall deliver to Administrative Agent Eligible Collateral in the amount that the projected reduction in Net Operating Income resulting from the Alteration or Expansion exceeds $500,000 as additional security for the Indebtedness, which Eligible Collateral shall be returned to Borrower after evidence of completion of the applicable Alteration or Expansion and no Event of Default has occurred and is continuing. (eE) All work done in connection with any Alteration or Expansion shall be performed with due diligence to Final Completion in a good and workmanlike manner, all materials used in connection with any Alteration or Expansion shall be not less than the standard of quality of the materials generally used at the Property as of the date hereof (or, if greater, the then-current customary quality in the sub-market in which the Property is located) and all work shall be performed and all materials used in accordance with all applicable Legal Requirements and Insurance Requirements. (fF) The cost of any Alteration or Expansion shall be promptly and fully paid for by Borrower, subject to the next succeeding sentence. No payment made prior to the Final Completion (excluding punch-list items) of an Alteration or Expansion or Restoration to any contractor, subcontractor, materialman, supplier, engineer, architect, project manager or other Person who renders services or furnishes materials in connection with such Alteration shall exceed ninety percent (90%) of the aggregate value of the work performed by such Person from time to time and materials furnished and incorporated into the Improvements. (g) All work performed in connection with the cure of the Deferred Maintenance Conditions shall be performed in accordance with the terms and conditions set forth in clauses (a), (c), (e) and (f) of this Section 10.2. (h) With respect to any Material Alteration or Material Expansion: (i) Borrower shall have delivered to Lender Eligible Collateral in an amount equal to at least the total estimated remaining unpaid costs of such Material Alteration or Material Expansion which is in excess of the Threshold Amount, which Eligible Collateral shall be held by Lender as security for the Indebtedness and released to Borrower as such work progresses in accordance with Section 10.2(h)(iii); provided, however, in the event that any Material Alteration or Material Expansion shall be made in conjunction with any Restoration with respect to which Borrower shall be entitled to use or apply Proceeds pursuant to Section 6.2 hereof (including any Proceeds remaining after completion of such Restoration), the amount of the Eligible Collateral to be furnished pursuant hereto need not exceed the aggregate cost of such Restoration and such Material Alteration or Material Expansion (in either case, as estimated by the Independent Architect) less the sum of the amount of any Proceeds which the Borrower is entitled to withdraw pursuant to Section 6.2 hereof and the Threshold Amount; (ii) Prior to commencement of construction of such Material Alteration or Material Expansion, Borrower shall deliver to Lender a schedule (with the concurrence of the Independent Architect) setting forth the projected stages of completion of such Alteration or Expansion and the corresponding amounts expected to be due and payable by or on behalf of Borrower in connection with such completion, such schedule to be updated quarterly by Borrower (and with the concurrence of the Independent Architect) during the performance of such Alteration or Expansion. (iii) Any Eligible Collateral that a Borrower delivers to Lender pursuant hereto (and the proceeds of any such Eligible Collateral) shall be invested (to the extent such Eligible Collateral can be invested) by Lender in Permitted Investments for a period of time consistent with the date on which the Borrower notifies Lender that the Borrower expects to request a release of such Eligible Collateral in accordance with the next succeeding sentence. From time to time as the Alteration or Expansion progresses, the amount of any Eligible Collateral so furnished may, upon the written request of Borrower to Lender, be withdrawn by Borrower and paid or otherwise applied by or returned to Borrower in an amount equal to the amount Borrower would be entitled to so withdraw if Section 6.2.4 were applicable, and any Eligible Collateral so furnished which is a Letter of Credit may be reduced by Borrower in an amount equal to the amount Borrower would be entitled to so reduce if Section 6.2.4 hereof were applicable, subject, in each case, to the satisfaction of the conditions precedent to withdrawal of funds or reduction of the Letter of Credit set forth in Section 6.2.4 hereof. In connection with the above-described quarterly update of the projected stages of completion of the Material Alteration or Material Expansion (as concurred with by an Independent Architect), Borrower shall increase (or be permitted to decrease, as applicable) the Eligible Collateral then deposited with Lender as necessary to comply with Section 10.2(h)(i) hereof. (iv) At any time after Final Completion of such Material Alterations or Material Expansions, the whole balance of any Cash deposited with Lender pursuant to Section 10.2(h) hereof then remaining on deposit may be withdrawn by Borrower and shall be paid by Lender to Borrower, and any Eligible Collateral so deposited shall, to the extent it has not been called upon, reduced or theretofore released, be released by Lender to Borrower, within ten (10) days after receipt by Lender of an application for such withdrawal and/or release together with an Officer’s Certificate, and as to the following clauses (A) and (B) of this clause also a certificate of the Independent Architect, setting forth in substance as follows: (A) that such Material Alteration(s) or Material Expansion(s) has been completed in all material respects in accordance with any plans and specifications therefor previously filed with Lender under Section 10.2(c) hereof; (B) that to the knowledge of the certifying Person, (x) such Material Alteration(s) or Material Expansion(s) has been completed in compliance with all Legal Requirements, and (y) to the extent required for the legal use or occupancy of the portion of the Property affected by such Alteration(s) or Expansion(s), the applicable Borrower has obtained a temporary or permanent certificate of occupancy (or similar certificate) or, if no such certificate is required, a statement to that effect; (C) that to the knowledge of the certifying Person, all amounts that a Borrower is or may become liable to pay in respect of such Material Alteration(s) or Material Expansion(s) through the date of the certification have been paid in full or adequately provided for and, to the extent that such are customary and reasonably obtainable by prudent property owners in the area where the applicable Property is located, that Lien waivers have been obtained from the general contractor and subcontractors performing such Alteration(s) or Expansion(s) or at its sole cost and expense, Borrower shall cause a nationally recognized title insurance company to deliver to Lender an endorsement to the Title Policy, updating such policy and insuring over such Liens without further exceptions to such policy other than Permitted Encumbrances, or shall, at its sole cost and expense, cause a reputable title insurance company to deliver a lender’s title insurance policy, in such form, in such amounts and with such endorsements as the Title Policy, which policy shall be dated the date of completion of the Material Alteration and shall contain no exceptions other than Permitted Encumbrances; provided, however, that if, for any reason, Borrower is unable to deliver the certification required by this clause (C) with respect to any costs or expenses relating to the Alteration(s) or Expansion(s), then, assuming Borrower is able to satisfy each of the other requirements set forth in clauses (A) and (B) above, Borrower shall be entitled to the release of the difference between the whole balance of such Eligible Collateral and the total of all costs and expenses to which Borrower is unable to certify; and (D) that to the knowledge of the certifying Person, no Event of Default has occurred and is continuing.

Appears in 1 contract

Samples: Loan and Security Agreement (Morgans Hotel Group Co.)

Alterations and Expansions. During the continuance of any Cash Flow Sweep Period or Event of Default, Borrower shall not and shall not permit Mortgage Borrower to incur or contract to incur any capital improvements requiring Capital Expenditures that are not consistent with the Approved Annual Budget, Schedule I of the Mortgage Loan Agreement, or the Approved Future Funding Budget (as defined in the Mortgage Loan Agreement) or as otherwise may be required pursuant to any Lease entered into in accordance with this Agreement. Borrower shall not permit Mortgage Borrower to perform, undertake, contract to perform ~~or undertake~~ or consent to any Material Alteration without the ~~performance~~ prior written consent of Lender, which consent (in the absence of an Event of Default) shall not be unreasonably withheld, delayed or ~~undertaking~~ conditioned, but may be conditioned on the delivery of additional collateral in the form of cash or cash equivalents acceptable to Lender in respect of the amount by which any such Material Alteration exceeds the Threshold Amount (to the extent that (i) Mortgage Lender has not required such additional collateral pursuant to the Mortgage Loan Agreement or ~~Expansion~~(ii) the Mortgage Loan has been repaid in full). If Lender’s consent is requested hereunder with respect to a Material Alteration, ~~except in accordance with~~ Lender may retain a construction consultant to review such request and, if such request is granted, Lender may retain a construction consultant to inspect the work from time to time. Borrower shall, on demand by Lender, reimburse Lender for the reasonable fees and disbursements of such consultant. With respect to every consent or approval or waiver of the Lender required or requested under this Section 6.13, such consent shall be deemed given if the following ~~terms and conditions~~conditions are met: (ai) ~~The Alteration or Expansion shall be undertaken in accordance with the applicable provisions of this Agreement, the other Loan Documents, the Leases and all Legal Requirements. (b) No~~ no Event of Default shall have occurred and be continuing ~~or shall occur as a result of such action.~~ (c) A Material Alteration or Material Expansion, to the extent architects are customarily used for alterations or expansions of those types, but including any structural change to any of the Property or the Improvements, shall be conducted under the supervision of an Independent Architect and shall not be undertaken until ten (10) Business Days after there shall have been filed with Lender, for information purposes only and not for approval by Lender, detailed plans and specifications and cost estimates therefor, prepared and approved in writing by such Independent Architect. Such plans and specifications may be revised at any time and from time to time, provided that revisions of such plans and specifications shall be filed with Lender, for information purposes only. (d) The Alteration or Expansion may not in and of itself, either during the Alteration or Expansion or upon completion, be reasonably expected to have a Material Adverse Effect with respect to the Property. (e) All work done in connection with any Alteration or Expansion shall be performed with due diligence to Final Completion in a good and workmanlike manner, all materials used in connection with any Alteration or Expansion shall be not less than the standard of quality of the materials generally used at the ~~Property~~ date of any notices specified below or as of the effective date hereof (or, if greater, the then-current customary quality in the sub-market in which the Property is located) and all work shall be performed and all materials used in accordance with all applicable Legal Requirements and Insurance Requirements. (f) The cost of any Alteration or Expansion shall be promptly and fully paid for by Borrower, subject to the next succeeding sentence. No payment made prior to the Final Completion (excluding punch-list items) of an Alteration or Expansion or Restoration to any contractor, subcontractor, materialman, supplier, engineer, architect, project manager or other Person who renders services or furnishes materials in connection with such Alteration shall exceed ninety percent (90%) of the aggregate value of the work performed by such Person from time to time and materials furnished and incorporated into the Improvements. (g) All work performed in connection with the cure of the Deferred Maintenance Conditions shall be performed in accordance with the terms and conditions set forth in clauses (adeemed approval), (c), (e) and (f) of this Section 10.2. (h) With respect to any Material Alteration or Material Expansion: (i) Borrower shall have delivered to Lender Eligible Collateral in an amount equal to at least the total estimated remaining unpaid costs of such Material Alteration or Material Expansion which is in excess of the Threshold Amount, which Eligible Collateral shall be held by Lender as security for the Indebtedness and released to Borrower as such work progresses in accordance with Section 10.2(h)(iii); provided, however, in the event that any Material Alteration or Material Expansion shall be made in conjunction with any Restoration with respect to which Borrower shall be entitled to use or apply Proceeds pursuant to Section 6.2 hereof (including any Proceeds remaining after completion of such Restoration), the amount of the Eligible Collateral to be furnished pursuant hereto need not exceed the aggregate cost of such Restoration and such Material Alteration or Material Expansion (in either case, as estimated by the Independent Architect) less the sum of the amount of any Proceeds which the Borrower is entitled to withdraw pursuant to Section 6.2 hereof and the Threshold Amount; (ii) ~~Prior to commencement of construction of such Material Alteration or Material Expansion,~~ Borrower shall ~~deliver~~ have sent Lender an email request for approval with respect to ~~Lender a schedule (with the concurrence of the Independent Architect) setting forth the projected stages of completion of~~ such Alteration or Expansion and the corresponding amounts expected to be due and payable by or on behalf of Borrower in connection with such completion, such schedule to be updated quarterly by Borrower (and with the concurrence of the Independent Architect) during the performance of such Alteration or Expansion. (iii) Any Eligible Collateral that a Borrower delivers to Lender pursuant hereto (and the proceeds of any such Eligible Collateral) shall be invested (matter to the extent such Eligible Collateral can be invested) by Lender in Permitted Investments for a period of time consistent with the date on which the Borrower notifies Lender that the Borrower expects to request a release of such Eligible Collateral Deemed Consent Notice Parties and otherwise in accordance with the ~~next succeeding sentence. From time to time~~ applicable terms and conditions hereof (the “Initial Notice”), which such Initial Notice shall have been (A) accompanied by any and all required information and documentation relating thereto as the Alteration or Expansion progresses, the amount of any Eligible Collateral so furnished may, upon the written request of Borrower to Lender, be withdrawn by Borrower and paid or otherwise applied by or returned to Borrower in an amount equal to the amount Borrower would be entitled to so withdraw if Section 6.2.4 were applicable, and any Eligible Collateral so furnished which is a Letter of Credit may be ~~reduced by Borrower~~ reasonably required in ~~an amount equal~~ order to approve or disapprove such matter (the amount Borrower would be entitled to so reduce if Section 6.2.4 hereof were applicable, subject, in each case, to the satisfaction of the conditions precedent to withdrawal of funds or reduction of the Letter of Credit set forth in Section 6.2.4 hereof. In connection with the above-described quarterly update of the projected stages of completion of the Material Alteration or Material Expansion (as concurred with by an Independent Architect), Borrower shall increase (or be permitted to decrease, as applicable) the Eligible Collateral then deposited with Lender as necessary to comply with Section 10.2(h)(i) hereof. (iv) At any time after Final Completion of such Material Alterations or Material Expansions, the whole balance of any Cash deposited with Lender pursuant to Section 10.2(h) hereof then remaining on deposit may be withdrawn by Borrower and shall be paid by Lender to Borrower, and any Eligible Collateral so deposited shall, to the extent it has not been called upon, reduced or theretofore released, be released by Lender to Borrower, within ten (10) days after receipt by Lender of an application for such withdrawal and/or release together with an Officer’s Certificate, and as to the following clauses (A“Approval Information”) and (B) ~~of this clause also a certificate of~~ marked in bold lettering with the ~~Independent Architect, setting~~ following language: “LENDER’S RESPONSE IS REQUIRED WITHIN SEVEN (7) BUSINESS DAYS OF RECEIPT OF THIS NOTICE PURSUANT TO THE TERMS OF A LOAN AGREEMENT BETWEEN THE UNDERSIGNED AND LENDER” and the subject line containing the Initial Notice shall have been marked “PRIORITY-DEEMED APPROVAL MAY APPLY”; (iii) Lender shall have failed to approve or disapprove the request set forth in ~~substance as follows:~~the Initial Notice within the aforesaid time-frame; (iv) Borrower shall have sent Lender an email request for approval with respect to such matter to the Deemed Consent Notice Parties and otherwise in accordance with the applicable terms and conditions hereof (the “Second Notice”), which such Second Notice shall have been (A) that such Material Alteration(s) or Material Expansion(s) has been completed in all material respects in accordance with any plans and specifications therefor previously filed with Lender under Section 10.2(c) hereof; (B) that to accompanied by the knowledge of the certifying Person, (x) such Material Alteration(s) or Material Expansion(s) has been completed in compliance with all Legal Requirements, and (y) to the extent required for the legal use or occupancy of the portion of the Property affected by such Alteration(s) or Expansion(s), the applicable Borrower has obtained a temporary or permanent certificate of occupancy (or similar certificate) or, if no such certificate is required, a statement to that effect; (C) that to the knowledge of the certifying Person, all amounts that a Borrower is or may become liable to pay in respect of such Material Alteration(s) or Material Expansion(s) through the date of the certification have been paid in full or adequately provided for and, to the extent that such are customary and reasonably obtainable by prudent property owners in the area where the applicable Property is located, that Lien waivers have been obtained from the general contractor and subcontractors performing such Alteration(s) or Expansion(s) or at its sole cost and expense, Borrower shall cause a nationally recognized title insurance company to deliver to Lender an endorsement to the Title Policy, updating such policy and insuring over such Liens without further exceptions to such policy other than Permitted Encumbrances, or shall, at its sole cost and expense, cause a reputable title insurance company to deliver a lender’s title insurance policy, in such form, in such amounts and with such endorsements as the Title Policy, which policy shall be dated the date of completion of the Material Alteration and shall contain no exceptions other than Permitted Encumbrances; provided, however, that if, for any reason, Borrower is unable to deliver the certification required by this clause (C) with respect to any costs or expenses relating to the Alteration(s) or Expansion(s), then, assuming Borrower is able to satisfy each of the other requirements set forth in clauses (A) Approval Information and (B) ~~above, Borrower shall be entitled to~~ marked in bold lettering with the ~~release of the difference between the whole balance of such Eligible Collateral~~ following language: “LENDER’S RESPONSE IS REQUIRED WITHIN FIVE (5) BUSINESS DAYS OF RECEIPT OF THIS NOTICE PURSUANT TO THE TERMS OF A LOAN AGREEMENT BETWEEN THE UNDERSIGNED AND LENDER” and the ~~total of all costs and expenses to which Borrower is unable to certify~~subject line containing the Second Notice shall have been marked “PRIORITY-DEEMED APPROVAL MAY APPLY”; and (Dv) ~~that~~ Lender shall have failed to approve or disapprove the ~~knowledge of~~ request set forth in the ~~certifying Person, no Event of Default has occurred and is continuing~~Second Notice within the aforesaid time-frame.

Appears in 1 contract

Samples: Mezzanine Loan Agreement (New York REIT, Inc.)

Alterations and Expansions. During the continuance of any Cash Flow Sweep Period or Event of Default, Borrower shall not incur or contract to incur any capital improvements requiring Capital Expenditures that are not consistent with the Approved Annual Budget, Schedule I, or the Approved Future Funding Budget or as otherwise may be required pursuant to any Lease entered into in accordance with this Agreement. Borrower shall not perform, undertake, contract to perform ~~or undertake~~ or consent to any Material Alteration without the ~~performance~~ prior written consent of Lender, which consent (in the absence of an Event of Default) shall not be unreasonably withheld, delayed or ~~undertaking~~ conditioned, but may be conditioned on the delivery of additional collateral in the form of cash or cash equivalents acceptable to Lender in respect of the amount by which any such Material Alteration exceeds the Threshold Amount. If Lender’s consent is requested hereunder with respect to a Material Alteration, Lender may retain a construction consultant to review such request and, if such request is granted, Lender may retain a construction consultant to inspect the work from time to time. Borrower shall, on demand by Lender, reimburse Lender for the reasonable fees and disbursements of such consultant. With respect to every consent or ~~Expansion~~approval or waiver of the Lender required or requested under this Section 6.13, ~~except in accordance with~~ such consent shall be deemed given if the following ~~terms and conditions~~conditions are met: (ai) ~~The Alteration or Expansion shall be undertaken in accordance with the applicable provisions of this Agreement, the other Loan Documents, the Leases and all Legal Requirements. (b) No~~ no Event of Default shall have occurred and be continuing ~~or shall occur as a result of such action.~~ (c) A Material Alteration or Material Expansion, to the extent architects are customarily used for alterations or expansions of those types, but including any structural change to any of the Property or the Improvements, shall be conducted under the supervision of an Independent Architect and shall not be undertaken until ten (10) Business Days after there shall have been filed with Lender, for information purposes only and not for approval by Lender, detailed plans and specifications and cost estimates therefor, prepared and approved in writing by such Independent Architect. Such plans and specifications may be revised at any time and from time to time, provided that revisions of such plans and specifications shall be filed with Lender, for information purposes only. (d) The Alteration or Expansion may not in and of itself, either during the Alteration or Expansion or upon completion, be reasonably expected to have a Material Adverse Effect with respect to the Property. (e) All work done in connection with any Alteration or Expansion shall be performed with due diligence to Final Completion in a good and workmanlike manner, all materials used in connection with any Alteration or Expansion shall be not less than the standard of quality of the materials generally used at the ~~Property~~ date of any notices specified below or as of the effective date hereof (or, if greater, the then-current customary quality in the sub-market in which the Property is located) and all work shall be performed and all materials used in accordance with all applicable Legal Requirements and Insurance Requirements. (f) The cost of any Alteration or Expansion shall be promptly and fully paid for by Borrower, subject to the next succeeding sentence. No payment made prior to the Final Completion (excluding punch-list items) of an Alteration or Expansion or Restoration to any contractor, subcontractor, materialman, supplier, engineer, architect, project manager or other Person who renders services or furnishes materials in connection with such Alteration shall exceed ninety percent (90%) of the aggregate value of the work performed by such Person from time to time and materials furnished and incorporated into the Improvements. (g) All work performed in connection with the cure of the Deferred Maintenance Conditions shall be performed in accordance with the terms and conditions set forth in clauses (adeemed approval), (c), (e) and (f) of this Section 10.2. (h) With respect to any Material Alteration or Material Expansion: (i) Borrower shall have delivered to Lender Eligible Collateral in an amount equal to at least the total estimated remaining unpaid costs of such Material Alteration or Material Expansion which is in excess of the Threshold Amount, which Eligible Collateral shall be held by Lender as security for the Indebtedness and released to Borrower as such work progresses in accordance with Section 10.2(h)(iii); provided, however, in the event that any Material Alteration or Material Expansion shall be made in conjunction with any Restoration with respect to which Borrower shall be entitled to use or apply Proceeds pursuant to Section 6.2 hereof (including any Proceeds remaining after completion of such Restoration), the amount of the Eligible Collateral to be furnished pursuant hereto need not exceed the aggregate cost of such Restoration and such Material Alteration or Material Expansion (in either case, as estimated by the Independent Architect) less the sum of the amount of any Proceeds which the Borrower is entitled to withdraw pursuant to Section 6.2 hereof and the Threshold Amount; (ii) ~~Prior to commencement of construction of such Material Alteration or Material Expansion,~~ Borrower shall ~~deliver~~ have sent Lender an email request for approval with respect to ~~Lender a schedule (with the concurrence of the Independent Architect) setting forth the projected stages of completion of~~ such Alteration or Expansion and the corresponding amounts expected to be due and payable by or on behalf of Borrower in connection with such completion, such schedule to be updated quarterly by Borrower (and with the concurrence of the Independent Architect) during the performance of such Alteration or Expansion. (iii) Any Eligible Collateral that a Borrower delivers to Lender pursuant hereto (and the proceeds of any such Eligible Collateral) shall be invested (matter to the extent such Eligible Collateral can be invested) by Lender in Permitted Investments for a period of time consistent with the date on which the Borrower notifies Lender that the Borrower expects to request a release of such Eligible Collateral Deemed Consent Notice Parties and otherwise in accordance with the ~~next succeeding sentence. From time to time~~ applicable terms and conditions hereof (the “Initial Notice”), which such Initial Notice shall have been (A) accompanied by any and all required information and documentation relating thereto as the Alteration or Expansion progresses, the amount of any Eligible Collateral so furnished may, upon the written request of Borrower to Lender, be withdrawn by Borrower and paid or otherwise applied by or returned to Borrower in an amount equal to the amount Borrower would be entitled to so withdraw if Section 6.2.4 were applicable, and any Eligible Collateral so furnished which is a Letter of Credit may be ~~reduced by Borrower~~ reasonably required in ~~an amount equal~~ order to approve or disapprove such matter (the amount Borrower would be entitled to so reduce if Section 6.2.4 hereof were applicable, subject, in each case, to the satisfaction of the conditions precedent to withdrawal of funds or reduction of the Letter of Credit set forth in Section 6.2.4 hereof. In connection with the above-described quarterly update of the projected stages of completion of the Material Alteration or Material Expansion (as concurred with by an Independent Architect), Borrower shall increase (or be permitted to decrease, as applicable) the Eligible Collateral then deposited with Lender as necessary to comply with Section 10.2(h)(i) hereof. (iv) At any time after Final Completion of such Material Alterations or Material Expansions, the whole balance of any Cash deposited with Lender pursuant to Section 10.2(h) hereof then remaining on deposit may be withdrawn by Borrower and shall be paid by Lender to Borrower, and any Eligible Collateral so deposited shall, to the extent it has not been called upon, reduced or theretofore released, be released by Lender to Borrower, within ten (10) days after receipt by Lender of an application for such withdrawal and/or release together with an Officer’s Certificate, and as to the following clauses (A“Approval Information”) and (B) ~~of this clause also a certificate of~~ marked in bold lettering with the ~~Independent Architect, setting~~ following language: “LENDER’S RESPONSE IS REQUIRED WITHIN SEVEN (7) BUSINESS DAYS OF RECEIPT OF THIS NOTICE PURSUANT TO THE TERMS OF A LOAN AGREEMENT BETWEEN THE UNDERSIGNED AND LENDER” and the subject line containing the Initial Notice shall have been marked “PRIORITY-DEEMED APPROVAL MAY APPLY”; (iii) Lender shall have failed to approve or disapprove the request set forth in ~~substance as follows:~~the Initial Notice within the aforesaid time-frame; (iv) Borrower shall have submitted a second request for approval with respect to such matter to the Deemed Consent Notice Parties and otherwise in accordance with the applicable terms and conditions hereof (the “Second Notice”), which such Second Notice shall have been (A) that such Material Alteration(s) or Material Expansion(s) has been completed in all material respects in accordance with any plans and specifications therefor previously filed with Lender under Section 10.2(c) hereof; (B) that to accompanied by the knowledge of the certifying Person, (x) such Material Alteration(s) or Material Expansion(s) has been completed in compliance with all Legal Requirements, and (y) to the extent required for the legal use or occupancy of the portion of the Property affected by such Alteration(s) or Expansion(s), the applicable Borrower has obtained a temporary or permanent certificate of occupancy (or similar certificate) or, if no such certificate is required, a statement to that effect; (C) that to the knowledge of the certifying Person, all amounts that a Borrower is or may become liable to pay in respect of such Material Alteration(s) or Material Expansion(s) through the date of the certification have been paid in full or adequately provided for and, to the extent that such are customary and reasonably obtainable by prudent property owners in the area where the applicable Property is located, that Lien waivers have been obtained from the general contractor and subcontractors performing such Alteration(s) or Expansion(s) or at its sole cost and expense, Borrower shall cause a nationally recognized title insurance company to deliver to Lender an endorsement to the Title Policy, updating such policy and insuring over such Liens without further exceptions to such policy other than Permitted Encumbrances, or shall, at its sole cost and expense, cause a reputable title insurance company to deliver a lender’s title insurance policy, in such form, in such amounts and with such endorsements as the Title Policy, which policy shall be dated the date of completion of the Material Alteration and shall contain no exceptions other than Permitted Encumbrances; provided, however, that if, for any reason, Borrower is unable to deliver the certification required by this clause (C) with respect to any costs or expenses relating to the Alteration(s) or Expansion(s), then, assuming Borrower is able to satisfy each of the other requirements set forth in clauses (A) Approval Information and (B) ~~above, Borrower shall be entitled to~~ marked in bold lettering with the ~~release of the difference between the whole balance of such Eligible Collateral~~ following language: “LENDER’S RESPONSE IS REQUIRED WITHIN FIVE (5) BUSINESS DAYS OF RECEIPT OF THIS NOTICE PURSUANT TO THE TERMS OF A LOAN AGREEMENT BETWEEN THE UNDERSIGNED AND LENDER” and the ~~total of all costs and expenses to which Borrower is unable to certify~~subject line containing the Second Notice shall have been marked “PRIORITY-DEEMED APPROVAL MAY APPLY”; and (Dv) ~~that~~ Lender shall have failed to failed to approve or disapprove the ~~knowledge of~~ request set forth in the ~~certifying Person, no Event of Default has occurred and is continuing~~Second Notice within the aforesaid time-frame.

Appears in 1 contract

Samples: Loan Agreement (New York REIT, Inc.)

Common use of Alterations and Expansions Clause in Contracts