Exculpation. Subject to the qualifications below, Lender shall not enforce the liability and obligation of Borrower or its constituent members, partners, shareholders, directors, employees or agents or the direct or indirect constituent members, partners, shareholders, directors, employees or agents thereof (collectively, the “Borrower Parties”) or any other Person, to perform and observe the obligations contained in this Agreement, the Note or any of the other Loan Documents by any action or proceeding wherein a money judgment shall be sought against any of the Borrower Parties or any other Person, except that Lender may bring a foreclosure action, an action for specific performance or any other appropriate action or proceeding to enable Lender to enforce and realize upon the Property, the Rents or any other collateral given to Lender pursuant to this Agreement and the other Loan Documents; provided, however, that, except as specifically provided herein, any judgment in any such action or proceeding shall be enforceable against the Borrower Parties only to the extent of their interest in the Property, the Rents and in any other collateral given to Lender, and Lender, by accepting this Agreement, the Note and the other Loan Documents, agrees that it shall not sxx for, seek or demand any deficiency judgment against any of the Borrower Parties or any other Person in any such action or proceeding under or by reason of or in connection with this Agreement, the Note or any of the other Loan Documents. The provisions of this paragraph shall not, however, (i) constitute a waiver, release or impairment of any obligation evidenced or secured by this Agreement, the Note or any of the other Loan Documents; (ii) impair the right of Lender to name any of the Borrower Parties, as a party defendant in any action or suit for foreclosure and sale under the Mortgage; (iii) affect the validity or enforceability of any guaranty made in connection with the Loan or any rights and remedies of Lender thereunder; (iv) impair the right of Lender to obtain the appointment of a receiver; (v) impair the enforcement of the Assignment of Leases and Rents; or (vi) constitute a waiver of the right of Lender to enforce the liability and obligation of Borrower (but not against any members of Borrower (other than Guarantor to the extent provided in the Non-Recourse Guaranty) or their direct or indirect constituent members or partners or any other Person), by money judgment or otherwise, to the extent of any loss, damage, cost, expense, liability, claim or other obligation (but excluding any punitive, consequential or speculative damages) incurred by Lender (including attorneys’ fees and costs reasonably incurred) arising out of or in connection with the following: (a) fraud or intentional misrepresentation by Borrower or Guarantor in connection with the Loan; (b) intentional physical waste of the Property (including, but not limited to, waste due to gross negligence) by Borrower or any affiliate thereof; provided, however, such physical waste shall exclude wear and tear to the Property that occurs in the ordinary course of business of the Property by Borrower or any affiliate thereof; (c) the material breach of any representation, warranty, covenant or indemnification provision in the Environmental Indemnity or in this Agreement concerning Environmental Laws, Hazardous Substances and Asbestos; (d) the removal or disposal by Borrower or any affiliate thereof of any portion of the Property after an Event of Default has occurred and while it is continuing, unless such portion of the Property is replaced by an item of equal or greater value as determined by Lender in its reasonable discretion; (e) the misapplication or conversion by Borrower or any affiliate thereof of (i) any insurance proceeds paid by reason of any loss, damage or destruction to the Property, (ii) any awards or other amounts received in connection with the condemnation of all or a portion of the Property, (iii) any Rents following an Event of Default or (iv) any Rents paid more than one (1) month in advance; (f) failure to pay charges for labor or materials or taxes or other charges that can create liens superior to the lien of the Mortgage on any portion of the Property unless such taxes or other charges are being contested in accordance herewith or such taxes or charges have been delivered to Lender in accordance with Section 3.3 hereof or Borrower has complied with Section 5.2 hereof; and (g) any security deposits collected by Borrower or any affiliate thereof with respect to the Property which are not delivered to Lender upon a foreclosure of the Property or action in lieu thereof, except to the extent any such security deposits were applied in accordance with the terms and conditions of any of the Leases prior to the occurrence of the Event of Default that gave rise to such foreclosure or action in lieu thereof. Notwithstanding anything to the contrary in any of the Loan Documents (i) Lender shall not be deemed to have waived any right which Lender may have under Section 506(a), 506(b), 1111(b) or any other provisions of the U.S. Bankruptcy Code to file a claim for the full amount of the Debt or to require that all collateral shall continue to secure all of the Debt owing to Lender in accordance with the Loan Documents, and (ii) the Debt shall become fully recourse to Borrower (but not its members (other than Guarantor solely to the extent provided in the Non-Recourse Guaranty) or other direct or indirect constituent members or partners or any other Person) in the event that: (A) the first full Monthly Debt Service Payment Amount (as defined in the Note) under the Note is not paid when due; (B) other than in connection with a default under subsection (x) of the definition of Special Purpose Bankruptcy Remote Entity set forth in Schedule 5 hereto, Borrower fails to maintain its status as a Special Purpose Bankruptcy Remote Entity in accordance with the provisions of this Agreement and such failure results in the substantive consolidation of Borrower with another Person; (C) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any subordinate financing or other voluntary lien encumbering the Property; (D) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any assignment, transfer, or conveyance of the Property or any interest therein as and to the extent required by this Agreement or the Mortgage; or (E) (1) if any petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law, shall be filed by Borrower or Guarantor, or (2) if Borrower or Guarantor files an answer consenting to, or otherwise joining in, any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law filed against it by any other Person, or is found pursuant to a final, unappealable order of a court of competent jurisdiction to have solicited or caused to be solicited creditors to file any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law against Borrower or Guarantor, or (3) if Borrower or Guarantor are found, pursuant to a final unappealable order of a court of competent jurisdiction, to have been in collusion with creditors that initiate a bankruptcy action or proceeding against Borrower or Guarantor or (F) an Event of Default described in Section 8.1(s) hereof shall have occurred.
Appears in 1 contract
Exculpation. Subject Except as otherwise specifically provided in the Plan, no Exculpated Party shall have or incur, and each Exculpated Party is released and exculpated from any Cause of Action for any claim related to the qualifications belowany act or omission in connection with, Lender shall not enforce the liability and obligation of Borrower relating to, or its constituent members, partners, shareholders, directors, employees or agents or the direct or indirect constituent members, partners, shareholders, directors, employees or agents thereof (collectivelyarising out of, the “Borrower Parties”) Chapter 11 Cases, the formulation, preparation, dissemination, negotiation, or filing of the RSA and related prepetition transactions, the Disclosure Statement, the Plan, or any other PersonRestructuring Transaction, to perform and observe the obligations contained in this Agreementcontract, the Note or any of the other Loan Documents by any action or proceeding wherein a money judgment shall be sought against any of the Borrower Parties or any other Person, except that Lender may bring a foreclosure action, an action for specific performance or any other appropriate action or proceeding to enable Lender to enforce and realize upon the Property, the Rents or any other collateral given to Lender pursuant to this Agreement and the other Loan Documents; provided, however, that, except as specifically provided herein, any judgment in any such action or proceeding shall be enforceable against the Borrower Parties only to the extent of their interest in the Property, the Rents and in any other collateral given to Lender, and Lender, by accepting this Agreement, the Note and the other Loan Documents, agrees that it shall not sxx for, seek or demand any deficiency judgment against any of the Borrower Parties or any other Person in any such action or proceeding under or by reason of or in connection with this Agreement, the Note or any of the other Loan Documents. The provisions of this paragraph shall not, however, (i) constitute a waiverinstrument, release or impairment of any obligation evidenced other agreement or secured by this Agreement, the Note document created or any of the other Loan Documents; (ii) impair the right of Lender to name any of the Borrower Parties, as a party defendant in any action or suit for foreclosure and sale under the Mortgage; (iii) affect the validity or enforceability of any guaranty made entered into in connection with the Loan Disclosure Statement or any rights and remedies of Lender thereunder; (iv) impair the right of Lender to obtain Plan, the appointment of a receiver; (v) impair the enforcement filing of the Assignment Chapter 11 Cases, the pursuit of Leases Confirmation, the pursuit of Consummation, the administration and Rents; or (vi) constitute a waiver implementation of the right Plan, including the issuance of Lender to enforce the liability and obligation of Borrower (but not against any members of Borrower (other than Guarantor securities pursuant to the extent provided in Plan, or the Non-Recourse Guaranty) or their direct or indirect constituent members or partners distribution of property under the Plan or any other Person)related agreement, by money judgment except for claims related to any act or otherwiseomission that is determined in a final order to have constituted actual fraud or gross negligence, but in all respects such Entities shall be entitled to reasonably rely upon the advice of counsel with respect to their duties and responsibilities pursuant to the extent Plan. The Exculpated Parties have, and upon completion of the Plan shall be deemed to have, participated in good faith and in compliance with the applicable laws with regard to the solicitation of votes and distribution of consideration pursuant to the Plan and, therefore, are not, and on account of such distributions shall not be, liable at any time for the violation of any lossapplicable law, damagerule, cost, expense, liability, claim or other obligation regulation governing the solicitation of acceptances or rejections of the Plan or such distributions made pursuant to the Plan. EXHIBIT B Transfer Agreement PROVISION FOR TRANSFER AGREEMENT The undersigned (but excluding any punitive, consequential or speculative damages“Transferee”) incurred by Lender (including attorneys’ fees and costs reasonably incurred) arising out of or in connection with the following:
(a) fraud or intentional misrepresentation hereby acknowledges that it has read and understands the Restructuring Support Agreement, dated as of (the “Agreement”),1 by Borrower or Guarantor in connection with and among the Loan;
Company Parties and each of the Consenting Stakeholders party thereto, (b) intentional physical waste desires to acquire the Claims described below (the “Transferred Claims”) from one of the Property Consenting Stakeholders (includingthe “Transferor”), but not limited to, waste due to gross negligence) by Borrower or any affiliate thereof; provided, however, such physical waste shall exclude wear and tear to the Property that occurs in the ordinary course of business of the Property by Borrower or any affiliate thereof;
(c) the material breach of any representation, warranty, covenant or indemnification provision in the Environmental Indemnity or in this Agreement concerning Environmental Laws, Hazardous Substances and Asbestos;
(d) the removal or disposal hereby irrevocably agrees to be bound by Borrower or any affiliate thereof of any portion of the Property after an Event of Default has occurred and while it is continuing, unless such portion of the Property is replaced by an item of equal or greater value as determined by Lender in its reasonable discretion;
(e) the misapplication or conversion by Borrower or any affiliate thereof of (i) any insurance proceeds paid by reason of any loss, damage or destruction to the Property, (ii) any awards or other amounts received in connection with the condemnation of all or a portion of the Property, (iii) any Rents following an Event of Default or (iv) any Rents paid more than one (1) month in advance;
(f) failure to pay charges for labor or materials or taxes or other charges that can create liens superior to the lien of the Mortgage on any portion of the Property unless such taxes or other charges are being contested in accordance herewith or such taxes or charges have been delivered to Lender in accordance with Section 3.3 hereof or Borrower has complied with Section 5.2 hereof; and
(g) any security deposits collected by Borrower or any affiliate thereof with respect to the Property which are not delivered to Lender upon a foreclosure of the Property or action in lieu thereof, except to the extent any such security deposits were applied in accordance with the terms and conditions of any the Agreement to the same extent the Transferor was thereby bound with respect to the Transferred Claims, and shall be deemed a “Consenting Stakeholder” and a [“Consenting Creditor”] / [“Consenting Sponsor”] under the terms of the Leases Agreement. The Transferee hereby specifically and irrevocably agrees (i) to be bound by the terms and conditions of the Agreement, to the same extent applicable to the Transferred Claims, (ii) to be bound by the vote of the Transferor if cast prior to the occurrence effectiveness of the Event of Default that gave rise to such foreclosure or action in lieu thereof. Notwithstanding anything to the contrary in any transfer of the Loan Documents (i) Lender shall not be deemed to have waived any right which Lender may have under Section 506(a)Transferred Claims, 506(b), 1111(b) or any other provisions of except as otherwise provided in the U.S. Bankruptcy Code to file a claim for the full amount of the Debt or to require that all collateral shall continue to secure all of the Debt owing to Lender in accordance with the Loan DocumentsAgreement, and (iiiii) that each of the Debt Parties shall become fully be an express third-party beneficiary of this Provision for Transfer Agreement and shall have the same recourse to Borrower (but not its members (other than Guarantor solely against the Transferee under the Agreement as such Party would have had against the Transferor with respect to the extent provided in the Non-Recourse Guaranty) or other direct or indirect constituent members or partners or any other Person) in the event thatTransferred Claims. Date Executed: (A) the first full Monthly Debt Service Payment Amount (as defined in the Note) under the Note is not paid when due; (B) other than in connection with a default under subsection (x) , Print name of the definition of Special Purpose Bankruptcy Remote Entity set forth in Schedule 5 hereto, Borrower fails to maintain its status as a Special Purpose Bankruptcy Remote Entity in accordance with the provisions of this Agreement and such failure results in the substantive consolidation of Borrower with another Person; (C) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any subordinate financing or other voluntary lien encumbering the Property; (D) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any assignment, transfer, or conveyance of the Property or any interest therein as and to the extent required by this Agreement or the Mortgage; or (E) (1) if any petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law, shall be filed by Borrower or Guarantor, or (2) if Borrower or Guarantor files an answer consenting to, or otherwise joining in, any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law filed against it by any other Person, or is found pursuant to a final, unappealable order of a court of competent jurisdiction to have solicited or caused to be solicited creditors to file any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law against Borrower or Guarantor, or (3) if Borrower or Guarantor are found, pursuant to a final unappealable order of a court of competent jurisdiction, to have been in collusion with creditors that initiate a bankruptcy action or proceeding against Borrower or Guarantor or (F) an Event of Default described in Section 8.1(s) hereof shall have occurred.Transferee Name: Title: Address: Attention: Telephone: Facsimile:
Appears in 1 contract
Samples: Restructuring Support Agreement
Exculpation. (a) Subject to the qualifications below, Lender shall not enforce the liability and obligation of Borrower or its constituent members, partners, shareholders, directors, employees or agents or the direct or indirect constituent members, partners, shareholders, directors, employees or agents thereof (collectively, the “Borrower Parties”) or any other Person, Operating Lessee to perform and observe the obligations contained in the Note, this Agreement, the Note Mortgage or any of the other Loan Documents by any action or proceeding wherein a money judgment shall be sought against any of the Borrower Parties or any other Person, Operating Lessee except that Lender may bring a foreclosure action, an action for specific performance or any other appropriate action or proceeding to enable Lender to enforce and realize upon its interest under the Note, this Agreement, the Mortgage and the other Loan Documents, or in the Property, the Rents Rents, or any other collateral given to Lender pursuant to this Agreement and the other Loan Documents; provided, however, that, except as specifically provided herein, any judgment in any such action or proceeding shall be enforceable against the Borrower Parties or Operating Lessee and only to the extent of their Borrower’s and Operating Lessee’s interest in the Property, in the Rents and in any other collateral given to Lender, and Lender, by accepting the Note, this Agreement, the Note Mortgage and the other Loan Documents, agrees that it shall not sxx sue for, seek or demand any deficiency judgment against any of the Borrower Parties or any other Person in any such action or proceeding under or by reason of or under or in connection with the Note, this Agreement, the Note Mortgage or any of the other Loan Documents. The provisions of this paragraph Section shall not, however, (ia) constitute a waiver, release or impairment of any obligation evidenced or secured by this Agreement, the Note or any of the other Loan Documents; (iib) impair the right of Lender to name any of the Borrower Parties, as a party defendant in any action or suit for foreclosure and sale under the Mortgage; (iiic) affect the validity or enforceability of or any guaranty made in connection with the Loan or any of the rights and remedies of Lender thereunder; (ivd) impair the right of Lender to obtain the appointment of a receiver; (ve) impair the enforcement of any assignment of leases contained in the Assignment of Leases and RentsMortgage; or (vif) constitute a waiver of prohibition against Lender to seek a deficiency judgment against Borrower or Operating Lessee in order to fully realize the security granted by the Mortgage or to commence any other appropriate action or proceeding in order for Lender to exercise its remedies against the Property.
(b) Nothing contained herein shall in any manner or way release, affect or impair the right of Lender to enforce the liability recover, and obligation each of Borrower (but not against any members of Borrower (other than Guarantor and Operating Lessee shall be fully and personally liable and subject to the extent provided in the Non-Recourse Guaranty) or their direct or indirect constituent members or partners or any other Person)legal action, by money judgment or otherwise, to the extent of for any loss, damage, cost, expense, liabilitydamage, claim or other obligation (but excluding any punitive, consequential or speculative damages) incurred by Lender (including without limitation reasonable attorneys’ fees and costs reasonably incurredcourt costs) incurred or suffered by Xxxxxx (as determined in a final judicial determination) arising out of or in connection with the following:
(ai) fraud or intentional misrepresentation by Borrower Xxxxxxxx, Operating Lessee, Operating Lessee Pledgor, or Guarantor in connection with the Loan;
(bii) the willful misconduct of Borrower, Operating Lessee, Operating Lessee Pledgor or Guarantor in connection with the Loan and/or the Property;
(iii) the intentional physical waste removal or disposal of any portion of the Property by Borrower, Operating Lessee or Guarantor during the continuance of an Event of Default (including, but not limited to, waste due except with respect to gross negligence) by Borrower or any affiliate thereof; provided, however, such physical waste shall exclude wear and tear to the Personal Property that occurs is removed if such Personal Property was removed in the ordinary course of business of the Property by Borrower or any affiliate thereof;
(c) the material breach of any representation, warranty, covenant or indemnification provision in the Environmental Indemnity or in this Agreement concerning Environmental Laws, Hazardous Substances and Asbestos;
(d) the removal or disposal by Borrower or any affiliate thereof of any portion of the Property after an Event of Default has occurred and while it is continuing, unless such portion of the Personal Property is replaced by an item of with other Personal Property with equal or greater value as determined by Lender in its reasonable discretionand utility);
(eiv) the misappropriation, misapplication or conversion by Borrower Xxxxxxxx, Operating Lessee, Operating Lessee Pledgor or any affiliate thereof Guarantor of (iA) any insurance proceeds Insurance Proceeds paid by reason of any loss, damage or destruction to the Property, (iiB) any awards or other amounts Awards received in connection with the condemnation a Condemnation of all or a portion of the Property, (iiiC) any Rents following during the continuance of an Event of Default Default, or (ivD) any Rents paid more than one (1) month in advanceadvance except to the extent of any bankruptcy, receivership, or similar judicial proceeding in which Borrower is legally prevented from directing the disbursement or payment of such sums or the terms of any applicable Lease;
(fv) the failure to pay Taxes (but specifically excluding any such amounts due in connection with the enforcement of any of the Loan Documents) to the extent that the Property generated sufficient revenue in the immediately preceding six (6) month period to pay the same (provided, however, that there shall be no personal liability under this subsection solely for the failure to pay Taxes if (A) sufficient sums had been reserved hereunder for the express purpose of paying the Taxes in question and Lender failed to pay same, (B) Lender’s access to such sums was not restricted or constrained by any action taken by Borrower, Operating Lessee or Guarantor in any manner and (C) no Event of Default was continuing);
(vi) failure to pay charges obtain and maintain the fully paid for labor or materials or taxes or other charges that can create liens superior to the lien of the Mortgage on any portion of the Property unless such taxes or other charges are being contested in accordance herewith or such taxes or charges have been delivered to Lender Policies in accordance with Section 3.3 6.1 hereof or Borrower has complied with Section 5.2 hereof; and
(g) any security deposits collected by Borrower or any affiliate thereof with respect to provided, however, that there shall be no personal liability under this subsection for the Property which are not delivered to Lender upon a foreclosure of the Property or action in lieu thereof, except aforementioned failures to the extent that, in each case, (A) if the failure is itself a failure to pay Insurance Premiums or is solely as a result of a failure to pay Insurance Premiums and (B)(1) the Property generated insufficient revenue in the immediately preceding six (6) month period to pay the Insurance Premiums in question or (2)(I) sufficient sums had been reserved hereunder for the express purpose of paying the Insurance Premiums in question and Lender failed to pay same, (II) Lender’s access to such sums was not restricted or constrained by any such security deposits were applied action taken by Xxxxxxxx, Operating Lessee or Guarantor in accordance with any manner and (III) no Event of Default was continuing);
(vii) intentionally omitted;
(viii) the terms and conditions of any termination of the Leases prior to License Agreement or the Sublicense Agreement (other than a termination by or at the written request of Lender);
(ix) the occurrence of a Soho Operating Covenant Breach;
(x) any termination payment or other fee, penalty or payment payable to any member pursuant to any Soho Club Documents as a result of termination thereof; provided, however, Borrower shall have no liability under this clause (xvi) unless such termination occurs on or before the Event date that is three (3) months after Lender (or its designee) obtains title to the Property; provided, further, however, Borrower shall remain liable at all times if any such loss is caused by the acts or omissions of Default Guarantor, Borrower, Operating Lessee or any of their Affiliates;
(xi) the termination of the Transition Services Agreement (other than a termination by or at the written request of Xxxxxx);
(xii) the failure of Borrower, Operating Lessee or Operating Lessee Pledgor to maintain its status as a Single Purpose Entity or comply with any representation, warranty or covenant set forth in Section 4.1.30 hereof if such failure has not been cited as a factor in the substantive consolidation of Borrower, Operating Lessee or Operating Lessee Pledgor with another Person; or
(xiii) Any voluntary Lien encumbering the Property that gave rise to such foreclosure or action in lieu thereof. is not covered by Section 9.3(c)(ii)(C) below.
(c) Notwithstanding anything to the contrary in this Agreement, the Note or any of the Loan Documents Documents, (i) Lender shall not be deemed to have waived any right which Lender may have under Section 506(a), 506(b), 1111(b) or any other provisions of the U.S. Bankruptcy Code to file a claim for the full amount of the Debt secured by the Mortgage or to require that all collateral shall continue to secure all of the Debt owing to Lender in accordance with the Loan Documents, and (ii) the Debt shall become be fully recourse to Borrower (but not its members (other than Guarantor solely to the extent provided in the Non-Recourse Guaranty) or other direct or indirect constituent members or partners or any other PersonA) in the event that: (A) the first full Monthly Debt Service Payment Amount (as defined in the Note) under the Note is not paid when due; (B) other than in connection with a default under subsection (x) of the definition of Special Purpose Bankruptcy Remote Entity set forth in Schedule 5 hereto, Borrower fails to maintain its status as a Special Purpose Bankruptcy Remote Entity in accordance with the provisions of this Agreement and such failure results in the substantive consolidation of Borrower with another Person; (C) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any subordinate financing or other voluntary lien encumbering the Property; (D) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any assignment, transfer, or conveyance of the Property or any interest therein as and to the extent required by this Agreement or the Mortgage; or (E) of:
(1) if any Borrower, Operating Lessee or Operating Lessee Pledgor filing a voluntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, under the Bankruptcy Code or any similar federal other Federal or state bankruptcy or insolvency law, shall be filed by Borrower or Guarantor, or ; (2) if Borrower the filing of an involuntary petition against Borrower, Operating Lessee or Operating Lessee Pledgor under the Bankruptcy Code or any other Federal or state bankruptcy or insolvency law in which Borrower, Operating Lessee, Operating Lessee Pledgor or Guarantor files an answer consenting tocolludes with, or otherwise joining inassists such Person, or solicits or causes to be solicited petitioning creditors for any involuntary petition for bankruptcyagainst Borrower, reorganization Operating Lessee or arrangement pursuant to federal bankruptcy law, or Operating Lessee Pledgor from any similar federal or state law filed against it by any other Person, or is found pursuant to a final, unappealable order of a court of competent jurisdiction to have solicited or caused to be solicited creditors to file any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law against Borrower or Guarantor, or (3) if Borrower or Guarantor are found, pursuant to a final unappealable order of a court of competent jurisdiction, to have been in collusion with creditors that initiate a bankruptcy action or proceeding against Borrower or Guarantor or (F) an Event of Default described in Section 8.1(s) hereof shall have occurred.;
Appears in 1 contract
Exculpation. (a) Subject to the qualifications below, no recourse shall be had against, Lender shall not enforce the liability and obligation of Borrower or its constituent members, partners, shareholders, directors, employees or agents or the direct or indirect constituent members, partners, shareholders, directors, employees or agents thereof (collectively, the “Borrower Parties”) or any other Person, to perform and observe the obligations contained in the Note, this Agreement, the Note Pledge Agreement or any of the other Loan Documents by any action or proceeding wherein a money judgment or any deficiency judgment or other judgment establishing personal liability shall be sought against against, any Borrower Party or any direct or indirect principal, director, officer, employee, manager, beneficiary, parent, beneficial owner, shareholder, partner, member, trustee, agent, or Affiliate of any Borrower Party or any direct or indirect legal representatives, successors or assigns of any of the Borrower Parties or any other Personforegoing (collectively, the “Exculpated Parties”), except that Lender Lender, may bring a foreclosure action, an action for specific performance or any other appropriate action or proceeding to enforce the Note, this Agreement, the Pledge Agreement and the other Loan Documents, or to enable Lender to enforce and realize upon Lender’s interest in the Property, the Rents Collateral or any other collateral given to Lender pursuant to this Agreement and the other Loan Documents; provided, however, that, except as specifically provided herein, any judgment in any such action or proceeding shall be enforceable against the Borrower Parties only to the extent of their Borrower’s interest in the Property, the Rents Collateral and in any other collateral given to Lender, and Lender, by accepting the Note, this Agreement, the Note Pledge Agreement and the other Loan Documents, agrees that it shall not sxx for, seek or demand any deficiency judgment with respect to the Loan against Borrower or any of the Borrower Exculpated Parties or any other Person in any such action or proceeding under or by reason of or under or in connection with the Note, this Agreement, the Note or any of Pledge Agreement, the other Loan DocumentsDocuments or otherwise. The provisions of this paragraph Section shall not, however, (i1) constitute a waiver, release or impairment of any obligation evidenced or secured by this Agreement, the Note or any of the other Loan Documents; (ii2) impair the right of Lender to name any of the Borrower Parties, as a party defendant in any action or suit for foreclosure, exercise of any power of sale, or an assignment in lieu of foreclosure and sale under upon the MortgageCollateral or exercise of remedies pursuant to the Pledge Agreement; (iii3) affect the validity or enforceability of any Loan Document or any guaranty in connection with the Loan (including, without limitation, the indemnities set forth in Article 12 hereof, the Guaranty and the Environmental Indemnity) made in connection with the Loan or any of the rights and remedies of Lender thereunder; (iv4) intentionally omitted, (5) impair the right of Lender to (A) obtain the appointment of a receiverreceiver and/or (B) enforce its rights and remedies provided in Articles 8 and 9 hereof; (v6) impair the enforcement of Pledge Agreement or any other Loan Documents; (7) constitute a prohibition against Lender, to seek a deficiency judgment against Borrower in order to fully realize the Assignment of Leases and Rentssecurity granted by the Pledge Agreement or to commence any other appropriate action or proceeding in order for Lender to exercise Lender’s remedies against the Property or any portion thereof; or (vi) 8) constitute a waiver of the right of Lender to enforce the liability and obligation of Borrower (but not against any members of Borrower (other than Guarantor to the extent provided in the Non-Recourse Guaranty) or their direct or indirect constituent members or partners or any other Person)Borrower, by money judgment or otherwise, to the extent of any loss, damage, cost, expense, liability, claim or other obligation (but excluding any punitive, consequential or speculative damages) actual Losses incurred by Lender (including actual out-of-pocket attorneys’ fees and costs reasonably incurred) arising out of or in connection with the following:
(ai) fraud or intentional misrepresentation by any Borrower or Guarantor Party in connection with the Loan;
(bii) the willful misconduct of any Borrower Party in connection with the Loan;
(iii) any litigation or other legal proceeding (including, the raising of defenses) related to the Debt filed or raised by any Borrower Party that delays, opposes, impedes, obstructs, hinders, enjoins or otherwise interferes with or frustrates the efforts of Lender to exercise any rights and remedies available to Lender as provided herein and in the other Loan Documents which is found by a court of competent jurisdiction to be without merit or brought or raised, as applicable, in bad faith;
(iv) intentional physical waste of the Property (including, but not limited to, waste due to gross negligence) by Borrower or any affiliate thereof; provided, however, such physical waste shall exclude wear and tear to the Property that occurs in the ordinary course of business violation of the Property by Borrower or any affiliate thereof;
(c) the material breach terms of any representation, warranty, covenant or indemnification provision in the Environmental Indemnity or in this Agreement concerning Environmental Laws, Hazardous Substances and Asbestos;
(d) caused by any Borrower Party and/or the removal or disposal by Borrower or any affiliate thereof of any portion of the Property after in violation of the terms of this Agreement during the continuance of an Event of Default has occurred and while it is continuing, unless such portion of the Property is replaced by an item of equal or greater value as determined by Lender in its reasonable discretionDefault;
(ev) the misapplication misappropriation or conversion by any Borrower or any affiliate thereof Party, in contravention of the Loan Documents, of (iA) any insurance proceeds paid by reason of any loss, damage or destruction to the Property, (iiB) any awards Awards or other amounts received in connection with the condemnation Condemnation of all or a portion of the Property, (iiiC) any Rents following an Event of Default Rents, or (ivD) any Security Deposits or Rents paid more than one (1) month collected in advance;
(fvi) failure to the extent there exists sufficient cash flow from the Property to pay Taxes or charges for labor or materials or taxes or other charges that can create liens superior to the lien of the Mortgage on any portion of the Property Property, Borrower’s failure to pay or cause Mortgage Borrower to pay such Taxes or charges (except to the extent (A) sums sufficient to pay such Taxes or charges have been deposited with Mortgage Lender in accordance with the terms of the Mortgage Loan Agreement or (B) such cash flow is not being made available to Borrower by Mortgage Lender as a result of Mortgage Lender’s exercise of its remedies under the Mortgage Loan Documents) unless such taxes Taxes or other charges are being contested as permitted hereunder or under the Mortgage Loan Agreement;
(vii) to the extent there exists sufficient cash flow from the Property to pay Insurance Premiums and/or to maintain the Policies in accordance herewith full force and effect, Borrower’s failure to pay or cause Mortgage Borrower to pay such taxes or charges Insurance Premiums and/or to maintain the Policies in full force and effect, in each case, as expressly provided herein (except to the (A) extent sums sufficient to pay such Insurance Premiums and/or to maintain the Policies have been delivered to deposited with Mortgage Lender in accordance with Section 3.3 hereof the terms of the Mortgage Loan Agreement or (B) such cash flow is not being made available to Borrower has complied with Section 5.2 hereof; andby Mortgage Lender as a result of Mortgage Lender’s exercise of its remedies under the Mortgage Loan Documents);
(gviii) any security deposits collected by Borrower or any affiliate thereof with respect to the Property Security Deposits which are not delivered to Lender upon by a Borrower Party following a foreclosure of the Property or action in lieu thereof, except to the extent any such security deposits Security Deposits were (a) delivered to Mortgage Lender in accordance with the Mortgage Loan Documents or (b) applied in accordance with the terms and conditions of any of the applicable Leases prior to the occurrence of the an Event of Default that gave rise to such foreclosure or action in lieu thereof. Notwithstanding anything to the contrary in any Default;
(ix) if as a result of the Loan Documents actions or inactions of Borrower or its Affiliates or Mortgage Borrower or its Affiliates (i) Lender shall not be deemed including, without limitation, Mortgage Borrower failing to have waived any right which Lender may have under Section 506(a), 506(b), 1111(b) or any other provisions of the U.S. Bankruptcy Code to file a claim for the full amount of the Debt or to require that all collateral shall continue to secure all of the Debt owing to Lender in accordance comply with the Loan Documents, and (iiterms of such Property Document) the Debt shall become fully recourse to Borrower (but not its members (other than Guarantor solely to the extent provided in the Non-Recourse Guaranty) or other direct or indirect constituent members or partners or any other Person) in the event that: Property Document is (A) the first full Monthly Debt Service Payment Amount (as defined materially modified in the Note) under the Note is not paid when due; a manner adverse to Lender or Mortgage Borrower, (B) other than in connection with a default under subsection (x) of the definition of Special Purpose Bankruptcy Remote Entity set forth in Schedule 5 heretoterminated, Borrower fails to maintain its status as a Special Purpose Bankruptcy Remote Entity in accordance with the provisions of this Agreement and such failure results in the substantive consolidation of Borrower with another Person; (C) cancelled or (D) otherwise ceases to exist, except as otherwise in each of the foregoing cases, if such action or inaction of Borrower or its Affiliates or Mortgage Borrower or its Affiliates is permitted pursuant to the terms of this Agreement and/or Lender has approved the same;
(x) any representation, warranty or covenant contained in Article 5 hereof is violated or breached; provided, however, that solely with respect to a breach of Section 5.1(a)(vii) that arise from Borrower’s or Mortgage Borrower’s failure to pay trade and operational indebtedness, such breach shall not result in recourse under the Loan Documentspursuant to this clause (x), if cash flow from the Property available to Borrower and/or Mortgage Borrower is not sufficient to pay such amounts;
(xi) except as set forth in Section 13.1(b) below, (A) Borrower fails to obtain Lender’s prior written consent to any subordinate financing or other voluntary lien encumbering the Property; (D) except Prohibited Transfer as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any assignment, transfer, or conveyance of the Property or any interest therein as and to the extent required by this Agreement (other than a Permitted Transfer) or (B) any covenant contained in Section 6.6 hereof is violated or breached;
(xii) any distributions to Borrower’s direct or indirect legal or beneficial owners after the Mortgageoccurrence and during the continuance of an Event of Default;
(xiii) any liabilities and obligations of Borrower, Mezzanine A Borrower or Mortgage Borrower: (i) accrued or accruing on or prior to any acquisition of title to the Collateral pursuant to a UCC foreclosure sale, a UCC strict foreclosure, an assignment in lieu of foreclosure or other enforcement action under the Loan Documents (collectively, an “Equity Collateral Enforcement Action”; and the date on which an Equity Collateral Enforcement Action is consummated, an “Equity Collateral Transfer Date”) with respect to indemnification obligations accrued or accruing in favor of Borrower, Mezzanine A Borrower, Mortgage Borrower or any Affiliate of Borrower, Mezzanine A Borrower and/or Mortgage Borrower (individually and collectively, a “Borrower Control Party”) under any organizational documents of any Borrower Control Party or any other agreement that was not either approved by Lender or entered into in compliance with this Agreement; (ii) without duplications of amounts paid or payable pursuant to Section 13.1(a)(iii) above, accrued or accruing prior to, on or after the Equity Collateral Transfer Date to pay legal fees to legal counsel engaged by any Borrower Control Party prior to the Equity Collateral Transfer Date if such legal fees were incurred to defend against an enforcement action under the Loan Documents; or (Eiii) (1) if any petition for bankruptcy, reorganization accrued or arrangement pursuant to federal bankruptcy law, or any similar federal or state law, shall be filed by Borrower or Guarantor, or (2) if Borrower or Guarantor files an answer consenting accruing prior to, on or otherwise joining inafter the Equity Collateral Transfer Date under any agreement (a “Third Party Agreement”) between any Borrower Control Party, on the one hand, and any involuntary petition for bankruptcyPerson not Affiliated with Mortgage Borrower, reorganization or arrangement pursuant to federal bankruptcy lawon the other hand, or any similar federal or state law filed against it by any other Person, or is found pursuant to a final, unappealable order that has been entered into during the continuance of a court of competent jurisdiction to have solicited or caused to be solicited creditors to file any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law against Borrower or Guarantor, or (3) if Borrower or Guarantor are found, pursuant to a final unappealable order of a court of competent jurisdiction, to have been in collusion with creditors that initiate a bankruptcy action or proceeding against Borrower or Guarantor or (F) an Event of Default described without the prior written approval of Lender to the extent such prior written approval was required under the Loan Documents (unless such Third Party Agreement has been assumed in Section 8.1(s) hereof shall have occurred.writing by the Person acquiring the Collateral on or after the Equity Collateral Transfer Date);
Appears in 1 contract
Samples: Mezzanine Loan Agreement (Brookfield DTLA Fund Office Trust Investor Inc.)
Exculpation. (a) Subject to the qualifications below, no recourse shall be had against, and none of Administrative Agent or any Lender shall not enforce the liability and obligation of Borrower or its constituent members, partners, shareholders, directors, employees or agents or the direct or indirect constituent members, partners, shareholders, directors, employees or agents thereof (collectively, the “Borrower Parties”) or any other Person, to perform and observe the obligations contained in the Note, this Agreement, the Note Security Instrument or any of the other Loan Documents by any action or proceeding wherein a money judgment or any deficiency judgment or other judgment establishing personal liability shall be sought against against, any Borrower Party or any direct or indirect principal, director, officer, employee, manager, beneficiary, parent, beneficial owner, shareholder, partner, member, trustee, agent, or Affiliate of any Borrower Party or any direct or indirect legal representatives, successors or assigns of any of the Borrower Parties or any other Personforegoing (collectively, the “Exculpated Parties”), except that Lender Administrative Agent, on behalf of Lenders, may bring a foreclosure action, an action for specific performance or any other appropriate action or proceeding to enforce the Note, this Agreement, the Security Instrument and the other Loan Documents, or to enable Lender Administrative Agent to enforce and realize upon Lenders’ interest in the Property, the Rents Rents, or any other collateral given to Lender Administrative Agent, on behalf of Lenders, pursuant to this Agreement and the other Loan Documents; provided, however, that, except as specifically provided herein, any judgment in any such action or proceeding shall be enforceable against the Borrower Parties only to the extent of their Borrower’s interest in the Property, in the Rents and in any other collateral given to LenderLenders and Administrative Agent, on behalf of Lenders, and LenderAdministrative Agent and Lenders, by accepting the Note, this Agreement, the Note Security Instrument and the other Loan Documents, agrees that it shall not sxx for, seek or demand any deficiency judgment with respect to the Loan against Borrower or any of the Borrower Exculpated Parties or any other Person in any such action or proceeding under or by reason of or under or in connection with the Note, this Agreement, the Note or any of Security Instrument, the other Loan DocumentsDocuments or otherwise. The provisions of this paragraph Section shall not, however, (i1) constitute a waiver, release or impairment of any obligation evidenced or secured by this Agreement, the Note or any of the other Loan Documents; (ii2) impair the right of Lender Administrative Agent, on behalf of Lenders, to name any of the Borrower Parties, as a party defendant in any action or suit for foreclosure and sale under the MortgageSecurity Instrument; (iii3) affect the validity or enforceability of any Loan Document or any guaranty in connection with the Loan (including, without limitation, the indemnities set forth in Article 12 hereof, the Guaranty and the Environmental Indemnity) made in connection with the Loan or any of the rights and remedies of Lender Agent and Lenders thereunder; (iv4) intentionally omitted, (5) impair the right of Lender Administrative Agent, on behalf of Lenders, to (A) obtain the appointment of a receiverreceiver and/or (B) enforce its rights and remedies provided in Articles 8 and 9 hereof; (v6) impair the enforcement of the Assignment assignment of Leases leases and Rentsrents contained in the Security Instrument and in any other Loan Documents; (7) constitute a prohibition against Administrative Agent, on behalf of Lenders, to seek a deficiency judgment against Borrower in order to fully realize the security granted by the Security Instrument or to commence any other appropriate action or proceeding in order for Administrative Agent to exercise Lenders’ remedies against the Property or any portion thereof; or (vi) 8) constitute a waiver of the right of Lender Administrative Agent and Lenders to enforce the liability and obligation of Borrower (but not against any members of Borrower (other than Guarantor to the extent provided in the Non-Recourse Guaranty) or their direct or indirect constituent members or partners or any other Person)Borrower, by money judgment or otherwise, to the extent of any loss, damage, cost, expense, liability, claim or other obligation (but excluding any punitive, consequential or speculative damages) actual Losses incurred by Lender Administrative Agent and/or Lenders (including actual out-of-pocket attorneys’ fees and costs reasonably incurred) arising out of or in connection with the following:
(ai) fraud or intentional misrepresentation by any Borrower or Guarantor Party in connection with the Loan;
(bii) the willful misconduct of any Borrower Party in connection with the Loan;
(iii) any litigation or other legal proceeding (including, the raising of defenses) related to the Debt filed or raised by any Borrower Party that delays, opposes, impedes, obstructs, hinders, enjoins or otherwise interferes with or frustrates the efforts of Administrative Agent or any Lender to exercise any rights and remedies available to Administrative Agent or any Lender as provided herein and in the other Loan Documents which is found by a court of competent jurisdiction to be without merit or brought or raised, as applicable, in bad faith;
(iv) intentional physical waste of the Property (including, but not limited to, waste due to gross negligence) by Borrower or any affiliate thereof; provided, however, such physical waste shall exclude wear and tear to the Property that occurs in the ordinary course of business violation of the Property by Borrower or any affiliate thereof;
(c) the material breach terms of any representation, warranty, covenant or indemnification provision in the Environmental Indemnity or in this Agreement concerning Environmental Laws, Hazardous Substances and Asbestos;
(d) caused by any Borrower Party and/or the removal or disposal by Borrower or any affiliate thereof of any portion of the Property after in violation of the terms of this Agreement during the continuance of an Event of Default has occurred and while it is continuing, unless such portion of the Property is replaced by an item of equal or greater value as determined by Lender in its reasonable discretionDefault;
(ev) the misapplication misappropriation or conversion by any Borrower or any affiliate thereof Party, in contravention of the Loan Documents, of (iA) any insurance proceeds paid by reason of any loss, damage or destruction to the Property, (iiB) any awards Awards or other amounts received in connection with the condemnation Condemnation of all or a portion of the Property, (iiiC) any Rents following an Event of Default Rents, or (ivD) any Security Deposits or Rents paid more than one (1) month collected in advance;
(fvi) failure to the extent there exists sufficient cash flow from the Property to pay Taxes or charges for labor or materials or taxes or other charges that can create liens superior to the lien of the Mortgage on any portion of the Property Property, Borrower’s failure to pay (or Borrower’s failure to cause payment of) such Taxes or charges (except to the extent (A) sums sufficient to pay such Taxes or charges have been deposited with Administrative Agent in accordance with the terms of this Agreement or (B) such cash flow is not being made available to Borrower by Administrative Agent as a result of Administrative Agent’s exercise of its remedies under the Loan Documents) unless such taxes Taxes or other charges are being contested as permitted hereunder;
(vii) to the extent there exists sufficient cash flow from the Property to pay Insurance Premiums and/or to maintain the Policies in accordance herewith full force and effect, Borrower’s failure to pay (or Borrower’s failure to cause payment of) such taxes or charges Insurance Premiums and/or to maintain the Policies in full force and effect, in each case, as expressly provided herein (except to the (A) extent sums sufficient to pay such Insurance Premiums and/or to maintain the Policies have been delivered to Lender deposited with Administrative Agent in accordance with Section 3.3 hereof the terms of this Agreement or (B) such cash flow is not being made available to Borrower has complied with Section 5.2 hereof; andby Administrative Agent as a result of Administrative Agent’s exercise of its remedies under the Loan Documents);
(gviii) any security deposits collected by Borrower or any affiliate thereof with respect to the Property Security Deposits which are not delivered to Lender upon Administrative Agent on behalf of Lenders by a Borrower Party following a foreclosure of the Property or action in lieu thereof, except to the extent any such security deposits Security Deposits were applied in accordance with the terms and conditions of any of the applicable Leases prior to the occurrence of the an Event of Default Default;
(ix) if as a result of the actions or inactions of Borrower or its Affiliates (including, without limitation, Borrower failing to comply with the terms of such Property Document) any Property Document is (A) materially modified in a manner adverse to Administrative Agent or any Lender or Borrower, (B) terminated, (C) cancelled or (D) otherwise ceases to exist, except in each of the foregoing cases, if such action or inaction of Borrower or its Affiliates is permitted pursuant to the terms of this Agreement and/or Administrative Agent has approved the same;
(x) any representation, warranty or covenant contained in Article 5 hereof is violated or breached; provided, however, that gave rise solely with respect to a breach of Section 5.1(a)(vii) that arise from Borrower’s failure to pay trade and operational indebtedness, such foreclosure breach shall not result in recourse under the Loan pursuant to this clause (x), if cash flow from the Property available to Borrower is not sufficient to pay such amounts;
(xi) except as set forth in Section 13.1(b) below, (A) Borrower fails to obtain Lender’s prior consent to any Prohibited Transfer as required by this Agreement (other than a Permitted Transfer) or action (B) any covenant contained in lieu thereof. Section 6.6 hereof is violated or breached; and/or
(xii) Borrower gives notice of termination of the Restricted Account Agreement other than in accordance with Section 8(d) of the Restricted Account Agreement in effect as of the Closing Date and the Restricted Account Agreement is terminated by Bank as a result of such notice.
(b) Notwithstanding anything to the contrary in this Agreement, the Note or any of the Loan Documents Documents, (iA) Lender Administrative Agent and Lenders shall not be deemed to have waived any right which Lender Administrative Agent and Lenders may have under Section 506(a), 506(b), 1111(b) or any other provisions of the U.S. Bankruptcy Code to file a claim for the full amount of the Debt or to require that all collateral shall continue to secure all of the Debt owing to Lender Administrative Agent and Lenders in accordance with the Loan Documents, and (iiB) the Debt shall become be fully recourse to Borrower (but not its members (other than Guarantor solely to the extent provided in the Non-Recourse Guaranty) or other direct or indirect constituent members or partners or any other Person) in the event that: :
(i) a Bankruptcy Event occurs;
(ii) any voluntary Sale or Pledge of the Property (other than (i) an easement (except for an easement affecting the Property that interferes or impairs in a material way Borrower’s ability to use and operate the Property as currently used or that otherwise has a Material Adverse Effect), (ii) a covenant or restriction that (A) does not interfere with or impair in a material way Borrower’s ability to use and operate the first full Monthly Debt Service Payment Amount (Property as defined in the Note) under the Note is not paid when due; currently used and (B) other than does not have a Material Adverse Effect, and (iii) a Lease entered into at the Property (except for a lease of all or a majority of the Property, a ground lease, or a master lease)) or any direct or indirect interest in connection Borrower or Guarantor that results in a failure to comply with a default under subsection the Minimum Ownership/Control Test, in each case in violation of the terms of this Agreement (but excluding (x) any failure to comply with the requirements in any of clause (A), (D), (E), (G) or (H) appearing in the definition of Special Purpose Bankruptcy Remote Entity set forth “Permitted Transfer” in Schedule 5 hereto, Borrower fails to maintain its status as a Special Purpose Bankruptcy Remote Entity in accordance with the provisions Section 6.3 of this Agreement and (y) any violation as a result of a failure of a Mezzanine Lender to comply with the Intercreditor Agreement);
(iii) if Borrower fails to obtain Administrative Agent’s prior consent (if and to the extent required under the Loan Documents) to (A) any subordinate financing or other voluntary liens encumbering the Property that are not considered Permitted Encumbrances hereunder or (B) any subordinate financing or other voluntary liens encumbering: (1) a direct interest in any subsidiary of Guarantor to the extent such failure subsidiary owns a direct or indirect interest in Borrower; or (2) a direct or indirect interest in Borrower if foreclosed upon would result in the Minimum Ownership/Control Test not being met; and/or
(iv) if any representation, warranty or covenant contained in Article 5 hereof is violated or breached and such violation or breach results in the substantive consolidation of the assets and liabilities of Borrower with another Person; (C) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any subordinate financing or other voluntary lien encumbering the Property; (D) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any assignment, transfer, or conveyance assets and liabilities of the Property or any interest therein as and to the extent required by this Agreement or the Mortgage; or (E) (1) if any petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law, shall be filed by Borrower or Guarantor, or (2) if Borrower or Guarantor files an answer consenting to, or otherwise joining in, any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law filed against it by any other Person, or is found pursuant to a final, unappealable order of a court of competent jurisdiction to have solicited or caused to be solicited creditors to file any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law against Borrower or Guarantor, or (3) if Borrower or Guarantor are found, pursuant to a final unappealable order of a court of competent jurisdiction, to have been in collusion with creditors that initiate a bankruptcy action or proceeding against Borrower or Guarantor or (F) an Event of Default described in Section 8.1(s) hereof shall have occurred.
Appears in 1 contract
Samples: Loan Agreement (Brookfield DTLA Fund Office Trust Investor Inc.)
Exculpation. Subject Notwithstanding anything to the qualifications belowcontrary contained in this Mortgage, Lender the Note or in any other Loan Document (but subject to the provisions of Sections 7.29, 7.30 and 7.31 of this Mortgage), Mortgagee shall not enforce the liability and obligation of Borrower or its constituent membersMortgagor, partners, shareholders, directors, employees or agents or the direct or indirect constituent members, partners, shareholders, directors, employees or agents thereof shareholders of Mortgagor and the officers and directors of each of them (collectively, the “Borrower "Exculpated Parties”") or any other Person, to perform and observe the obligations contained in the Note, this Agreement, the Note or any of the Mortgage and all other Loan Documents by any action or proceeding to collect damages or wherein a money judgment or any deficiency judgment or order or any judgment establishing any personal obligation or liability shall be sought against any of the Borrower Parties or any other Person, except that Lender Exculpated Parties. Mortgagee may bring a foreclosure action, an action for specific performance or any other appropriate action or proceeding to enable Lender Mortgagee to enforce and realize upon the Propertythis Mortgage, the Rents or any Note, the other collateral given to Lender pursuant to this Agreement Loan Documents, and the interest in the Property and the other Collateral granted to Mortgagee under the Loan Documents; provided, however, thatsubject to the provisions of Sections 7.29, except as specifically provided herein7.30 and 7.31, that any judgment in any such action or proceeding shall be enforceable against the Borrower Exculpated Parties only to the extent of their Mortgagor's interest in the Property, Property and the Rents and in any other collateral given Collateral granted to Lender, and LenderMortgagee under the Loan Documents. Mortgagee, by accepting this AgreementMortgage, the Note and the other Loan Documents, agrees that it shall not sxx fornot, seek except as otherwise provided below, sue for or demand any deficiency judgment against any of the Borrower Parties or any other Person Exculpated Partixx in any such action or proceeding proceeding, under or by reason of or under or in connection with this AgreementMortgage, the Note or any of the other Loan Documents. The provisions of this paragraph shall not, however, (i) constitute a waiver, release or impairment of any obligation evidenced or secured by this Agreement, the Note or any of the other Loan Documents; (ii) impair the right of Lender to name any of the Borrower Parties, as a party defendant in any action or suit for foreclosure and sale under the Mortgage; (iii) affect the validity or enforceability of any guaranty made in connection with the Loan or any rights and remedies of Lender thereunder; (iv) impair the right of Lender to obtain the appointment of a receiver; (v) impair the enforcement of the Assignment of Leases and Rents; or (vi) constitute a waiver of the right of Lender to enforce the liability and obligation of Borrower (but not against any members of Borrower (other than Guarantor to the extent provided in the Non-Recourse Guaranty) or their direct or indirect constituent members or partners or any other Person), by money judgment or otherwise, to the extent of any loss, damage, cost, expense, liability, claim or other obligation (but excluding any punitive, consequential or speculative damages) incurred by Lender (including attorneys’ fees and costs reasonably incurred) arising out of or in connection with the following:
(a) fraud or intentional misrepresentation by Borrower or Guarantor in connection with the Loan;
(b) intentional physical waste of the Property (including, but not limited to, waste due to gross negligence) by Borrower or any affiliate thereof; provided, however, such physical waste shall exclude wear and tear to the Property that occurs in the ordinary course of business of the Property by Borrower or any affiliate thereof;
(c) the material breach of any representation, warranty, covenant or indemnification provision in the Environmental Indemnity or in this Agreement concerning Environmental Laws, Hazardous Substances and Asbestos;
(d) the removal or disposal by Borrower or any affiliate thereof of any portion of the Property after an Event of Default has occurred and while it is continuing, unless such portion of the Property is replaced by an item of equal or greater value as determined by Lender in its reasonable discretion;
(e) the misapplication or conversion by Borrower or any affiliate thereof of (i) any insurance proceeds paid by reason of any loss, damage or destruction to the Property, (ii) any awards or other amounts received in connection with the condemnation of all or a portion of the Property, (iii) any Rents following an Event of Default or (iv) any Rents paid more than one (1) month in advance;
(f) failure to pay charges for labor or materials or taxes or other charges that can create liens superior to the lien of the Mortgage on any portion of the Property unless such taxes or other charges are being contested in accordance herewith or such taxes or charges have been delivered to Lender in accordance with Section 3.3 hereof or Borrower has complied with Section 5.2 hereof; and
(g) any security deposits collected by Borrower or any affiliate thereof with respect to the Property which are not delivered to Lender upon a foreclosure of the Property or action in lieu thereof, except to the extent any such security deposits were applied in accordance with the terms and conditions of any of the Leases prior to the occurrence of the Event of Default that gave rise to such foreclosure or action in lieu thereof. Notwithstanding anything to the contrary in any of the Loan Documents (i) Lender shall not be deemed to have waived any right which Lender may have under Section 506(a), 506(b), 1111(b) or any other provisions of the U.S. Bankruptcy Code to file a claim for the full amount of the Debt or to require that all collateral shall continue to secure all of the Debt owing to Lender in accordance with the Loan Documents, and (ii) the Debt shall become fully recourse to Borrower (but not its members (other than Guarantor solely to the extent provided in the Non-Recourse Guaranty) or other direct or indirect constituent members or partners or any other Person) in the event that: (A) the first full Monthly Debt Service Payment Amount (as defined in the Note) under the Note is not paid when due; (B) other than in connection with a default under subsection (x) of the definition of Special Purpose Bankruptcy Remote Entity set forth in Schedule 5 hereto, Borrower fails to maintain its status as a Special Purpose Bankruptcy Remote Entity in accordance with the provisions of this Agreement and such failure results in the substantive consolidation of Borrower with another Person; (C) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any subordinate financing or other voluntary lien encumbering the Property; (D) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any assignment, transfer, or conveyance of the Property or any interest therein as and to the extent required by this Agreement or the Mortgage; or (E) (1) if any petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law, shall be filed by Borrower or Guarantor, or (2) if Borrower or Guarantor files an answer consenting to, or otherwise joining in, any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law filed against it by any other Person, or is found pursuant to a final, unappealable order of a court of competent jurisdiction to have solicited or caused to be solicited creditors to file any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law against Borrower or Guarantor, or (3) if Borrower or Guarantor are found, pursuant to a final unappealable order of a court of competent jurisdiction, to have been in collusion with creditors that initiate a bankruptcy action or proceeding against Borrower or Guarantor or (F) an Event of Default described in Section 8.1(s) hereof shall have occurred.
Appears in 1 contract
Samples: Mortgage (Thackeray Corp)
Exculpation. Subject The obligations of each Borrower pursuant to the Loan Documents shall constitute general obligations of such Borrower. The foregoing notwithstanding and subject to the qualifications below, Lender Agent and the Lenders shall not enforce be entitled to, and shall not enforce, the liability and obligation of Borrower or its constituent members, partners, shareholders, directors, employees or agents or the direct or indirect constituent members, partners, shareholders, directors, employees or agents thereof (collectively, the “Borrower Parties”) or any other Person, to perform and observe the obligations contained in this Agreement, the Note Notes or in any of the other Loan Documents by any action or proceeding wherein a money judgment or personal liability shall be sought against any General Partner, any other general partner, from time to time, of any Borrower (other than a Borrower) or any "related person" (as defined in Treasury Regulation Section 1.752-4(b) of the Borrower Parties Code) to any General Partner or any other Persongeneral partner (which "related person" shall in no event ever be construed to include a Borrower, or any Borrower which is a general partner or member of a Borrower), any REIT or any officers, shareholders, partners, members or beneficial owners (other than any Borrower), directors, agents, employees or servants of any Borrower, General Partner or REIT or any other Person (other than a Borrower) (the "Exculpated Parties"), except that Lender Agent and/or Lenders may bring a foreclosure an enforcement action, a suit on the Note (provided, that neither Agent nor any Lender shall be entitled to a money judgment against any Exculpated Party pursuant to such suit), or an action for specific performance or against any other appropriate action or proceeding Exculpated Party to enable Lender Agent and/or Lenders to enforce and realize upon the Propertyits interests under this Agreement, the Rents Notes, the Pledge Agreement or the other Loan Documents or in the Collateral, or any other collateral given to Lender the Lenders pursuant to this Agreement and the other Loan Documents; provided, however, that, except as specifically provided herein, any judgment in any such action or proceeding shall be enforceable against the Borrower Exculpated Parties only to the extent of their Borrower's interest in the Property, the Rents Collateral and in any other collateral given or granted to LenderAgent and/or Lenders, and Lender, by accepting this Agreement, the Note and the other Loan Documents, agrees Agent and/or Lenders agree that it shall not sxx sue for, seek or demand any deficiency judgment against any of the Borrower Exxxlpated Parties or any other Person in any such action or proceeding under under, or by reason of of, or in connection with this Agreement, the Note Pledge Agreement, the Notes or any of the other Loan Documents. The provisions of this paragraph shall not, however, (ia) constitute a waiver, release or impairment of any obligation evidenced or secured by this Agreement, the Note Pledge Agreement, the Notes or any of the other Loan Documents; (iib) impair the right of Lender Agent and/or Lenders to name any of the Borrower Parties, as a party defendant in any action or suit for foreclosure and sale under to enforce the MortgagePledge Agreement; (iiic) affect the validity or enforceability of any guaranty or indemnity made in connection with the Loan or any of the rights and remedies of Lender Agent and/or Lenders thereunder, including, without limitation, the Environmental Indemnity; (ivd) impair the right of Lender Agent and/or Lenders to obtain the appointment of a receiver; or (ve) impair the enforcement of the Assignment of Leases and Rents; or (vi) constitute a waiver of the right of Lender Agent and/or Lenders to enforce the liability and obligation of Borrower (but not against any members of Borrower (other than Guarantor to the extent provided in the Non-Recourse Guaranty) or their direct or indirect constituent members or partners or any other Person), by money obtain a deficiency judgment or otherwise, to the extent of any loss, damage, cost, expense, liability, claim or other obligation (but excluding any punitive, consequential or speculative damages) incurred by Lender (including attorneys’ fees and costs reasonably incurred) arising out of or in connection with the following:
(a) fraud or intentional misrepresentation by Borrower or Guarantor in connection with the Loan;
(b) intentional physical waste of the Property (including, but not limited to, waste due to gross negligence) by Borrower or any affiliate thereof; provided, however, such physical waste shall exclude wear and tear to the Property that occurs in the ordinary course of business of the Property by Borrower or any affiliate thereof;
(c) the material breach of any representation, warranty, covenant or indemnification provision in the Environmental Indemnity or in this Agreement concerning Environmental Laws, Hazardous Substances and Asbestos;
(d) the removal or disposal by Borrower or any affiliate thereof of any portion of the Property after an Event of Default has occurred and while it is continuing, unless such portion of the Property is replaced by an item of equal or greater value as determined by Lender in its reasonable discretion;
(e) the misapplication or conversion by Borrower or any affiliate thereof of (i) any insurance proceeds paid by reason of any loss, damage or destruction to the Property, (ii) any awards or other amounts received in connection with the condemnation of all or a portion of the Property, (iii) any Rents following an Event of Default or (iv) any Rents paid more than one (1) month in advance;
(f) failure to pay charges for labor or materials or taxes or other charges that can create liens superior to the lien of the Mortgage judgment on any portion of the Property unless such taxes or other charges are being contested in accordance herewith or such taxes or charges have been delivered to Lender in accordance with Section 3.3 hereof or Borrower has complied with Section 5.2 hereof; and
(g) any security deposits collected by Borrower or any affiliate thereof with respect to the Property which are not delivered to Lender upon a foreclosure of the Property or action in lieu thereof, except to the extent any such security deposits were applied in accordance with the terms and conditions of any of the Leases prior to the occurrence of the Event of Default that gave rise to such foreclosure or action in lieu thereof. Notwithstanding anything to the contrary in any of the Loan Documents (i) Lender shall not be deemed to have waived any right which Lender may have under Section 506(a), 506(b), 1111(b) or any other provisions of the U.S. Bankruptcy Code to file a claim for the full amount of the Debt or to require that all collateral shall continue to secure all of the Debt owing to Lender in accordance with the Loan Documents, and (ii) the Debt shall become fully recourse to Borrower (but not its members (other than Guarantor solely to the extent provided in the Non-Recourse Guaranty) or other direct or indirect constituent members or partners or any other Person) in the event that: (A) the first full Monthly Debt Service Payment Amount (as defined in the Note) under the Note is not paid when due; (B) other than in connection with a default under subsection (x) of the definition of Special Purpose Bankruptcy Remote Entity set forth in Schedule 5 hereto, against Borrower fails to maintain its status as a Special Purpose Bankruptcy Remote Entity in accordance with the provisions of this Agreement and such failure results in the substantive consolidation of Borrower with another Person; (C) except as otherwise permitted pursuant to the Loan Documents, Borrower fails if necessary to obtain Lender’s prior written consent any Net Proceeds to any subordinate financing or other voluntary lien encumbering the Property; (D) except as which Agent and/or Lenders would otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any assignment, transfer, or conveyance of the Property or any interest therein as and to the extent required by be entitled under this Agreement or the Mortgage; or (E) (1) if any petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law, shall be filed by Borrower or Guarantor, or (2) if Borrower or Guarantor files an answer consenting to, or otherwise joining in, any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law filed against it by any other Person, or is found pursuant to a final, unappealable order of a court of competent jurisdiction to have solicited or caused to be solicited creditors to file any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law against Borrower or Guarantor, or (3) if Borrower or Guarantor are found, pursuant to a final unappealable order of a court of competent jurisdiction, to have been in collusion with creditors that initiate a bankruptcy action or proceeding against Borrower or Guarantor or (F) an Event of Default described in Section 8.1(s) hereof shall have occurredAgreement.
Appears in 1 contract
Samples: Revolving Credit Agreement (Shelbourne Properties Ii Inc)
Exculpation. (I) Subject to the qualifications below, Lender neither Agent nor Lenders shall not enforce the liability and obligation of Borrower or its constituent members, partners, shareholders, directors, employees or agents or the direct or indirect constituent members, partners, shareholders, directors, employees or agents thereof (collectively, the “Borrower Parties”) or any other Person, to perform and observe the obligations contained in the Note, this Agreement, the Note Mortgage or any of the other Loan Documents by any action or proceeding wherein a money judgment or any deficiency judgment or other judgment establishing personal liability shall be sought against Borrower or any principal, director, officer, employee, beneficiary, shareholder, partner, member, trustee, agent, or affiliate of Borrower (but specifically excluding Guarantor) or any legal representatives, successors or assigns of any of the Borrower Parties or any other Personforegoing (collectively, the “Exculpated Parties”), except that Lender Agent may bring a foreclosure action, an action for specific performance or any other appropriate action or proceeding to enable Lender Agent and Lenders to enforce and realize upon its interest under the Note, this Agreement, the Mortgage and the other Loan Documents, or in the Property, the Rents Rents, or any other collateral given to Lender Agent and/or Lenders pursuant to this Agreement and the other Loan Documents; provided, however, that, except as specifically provided herein, any judgment in any such action or proceeding shall be enforceable against the Borrower Parties only to the extent of their Borrower’s interest in the Property, in the Rents and in any other collateral given to LenderAgent, and LenderLenders and Agent, by accepting the Note, this Agreement, the Note Mortgage and the other Loan Documents, agrees that it shall not sxx xxx for, seek or demand any deficiency judgment against Borrower or any of the Borrower Parties or any other Person Exculpated Parties, in any such action or proceeding under or by reason of or under or in connection with the Note, this Agreement, the Note Mortgage or any of the other Loan Documents. The provisions of this paragraph Section shall not, however, (ia) constitute a waiver, release or impairment of any obligation evidenced or secured by this Agreement, the Note or any of the other Loan Documents; (iib) impair the right of Lender Agent or Lenders to name any of the Borrower Parties, as a party defendant in any action or suit for foreclosure and sale under the Mortgage; (iiic) affect the validity or enforceability of any guaranty indemnity, guaranty, or similar instrument made in connection with the Loan or any of the rights and remedies of Lender Agent or Lenders thereunder; (ivd) impair the right of Lender Agent or Lenders to obtain the appointment of a receiver; (ve) impair the enforcement of the Assignment of Leases and RentsLeases; (f) impair the right of Agent or Lenders to enforce the provisions of the Guaranty or the Environmental Indemnity; (g) constitute a prohibition against Agent or Lenders to seek a deficiency judgment against Borrower in order to fully realize on any security given by Borrower in connection with the Loan or to commence any other appropriate action or proceeding in order for Agent or Lenders to exercise its remedies against such security; or (vih) constitute a waiver of the right of Lender to enforce the liability and obligation of Borrower (but not against any members of Borrower (other than Guarantor to the extent provided in the Non-Recourse Guaranty) or their direct or indirect constituent members or partners or any other Person)Borrower, by money judgment or otherwise, to the extent of any loss, damage, cost, expense, liability, claim or other obligation (but excluding any punitive, consequential or speculative damages) actual Losses incurred by Lender Agent and Lenders (including out-of-pocket attorneys’ fees and costs reasonably incurred) arising out of or in connection with the following:following (“Loss Liability”):
(ai) fraud or intentional misrepresentation by Borrower, Guarantor or any Borrower or Guarantor Party in connection with the Loan;
(bii) intentional physical waste the gross negligence or willful misconduct of the Property (includingBorrower, but not limited to, waste due to gross negligence) by Borrower Guarantor or any affiliate thereof; provided, however, such physical waste shall exclude wear and tear to Borrower Party in connection with the Property that occurs in the ordinary course of business of the Property by Borrower or any affiliate thereofLoan;
(ciii) the material breach of any representation, warranty, covenant or indemnification provision in the Environmental Indemnity or in this Agreement any other Loan Document concerning Environmental Lawsenvironmental laws, Hazardous Substances hazardous substances and Asbestosasbestos and any indemnification of Agent and Lenders with respect thereto in any such document;
(div) material physical waste to the Property caused by intentional acts or intentional omissions of Borrower, Guarantor or any Borrower Party, other than waste (or alleged waste) to the Property resulting from the insufficiency of cash flow from the Property to prevent such waste and such insufficiency is not a result of misappropriation of Rents by Borrower, Guarantor or any Borrower Party or the removal of any material portion of the Property other than in the ordinary course of business;
(v) subject to Borrower’s right to contest the same as expressly set forth herein, (A) failure to pay Taxes, (B) charges for labor or disposal by Borrower materials, or any affiliate thereof of other charges that can create Liens, including, without limitation, mechanics’ or materialmens’ liens, on any portion of the Property after an Event of Default has occurred (provided that the foregoing shall not apply to any charges or liens caused by work done by any Tenant at the Property provided that Borrower is using all commercially reasonable efforts under the applicable Lease to cause such Tenant to pay such amounts expeditiously) and/or (C) the failure to pay Insurance Premiums in accordance with the terms hereof; provided that clauses (A) and while it (C) shall not apply at any time that (x) there is continuing, unless not sufficient cash flow to pay the same and such portion insufficiency is not due to misappropriation of the Property is replaced by an item of equal same, or greater value as determined by Lender in its reasonable discretion(y) there are sufficient amounts on reserve to pay such amounts and Agent shall not have made such amounts available to pay the same;
(evi) the misapplication misapplication, misappropriation or conversion by Borrower Borrower, or any affiliate thereof Borrower Parties in contravention of the Loan Documents of (iA) any insurance proceeds paid by reason of any loss, damage or destruction to the Property, (iiB) any awards Awards or other amounts received in connection with the condemnation Condemnation of all or a portion of the Property, (iii) any Rents following an Event of Default or (ivC) any Rents paid more than one (1) month in advance;
(f) failure to pay charges for labor or materials or taxes or other charges that can create liens superior to during the lien continuance of the Mortgage on any portion of the Property unless such taxes or other charges are being contested in accordance herewith or such taxes or charges have been delivered to Lender in accordance with Section 3.3 hereof or Borrower has complied with Section 5.2 hereof; and
(g) any security deposits collected by Borrower or any affiliate thereof with respect to the Property which are not delivered to Lender upon a foreclosure of the Property or action in lieu thereof, except to the extent any such security deposits were applied in accordance with the terms and conditions of any of the Leases prior to the occurrence of the Event of Default that gave rise to such foreclosure or action in lieu thereof. Notwithstanding anything to the contrary in any of the Loan Documents (i) Lender shall not be deemed to have waived any right which Lender may have under Section 506(a), 506(b), 1111(b) or any other provisions of the U.S. Bankruptcy Code to file a claim for the full amount of the Debt or to require that all collateral shall continue to secure all of the Debt owing to Lender in accordance with the Loan Documents, and (ii) the Debt shall become fully recourse to Borrower (but not its members (other than Guarantor solely to the extent provided in the Non-Recourse Guaranty) or other direct or indirect constituent members or partners or any other Person) in the event that: (A) the first full Monthly Debt Service Payment Amount (as defined in the Note) under the Note is not paid when due; (B) other than in connection with a default under subsection (x) of the definition of Special Purpose Bankruptcy Remote Entity set forth in Schedule 5 hereto, Borrower fails to maintain its status as a Special Purpose Bankruptcy Remote Entity in accordance with the provisions of this Agreement and such failure results in the substantive consolidation of Borrower with another Person; (C) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any subordinate financing or other voluntary lien encumbering the Property; (D) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any assignment, transfer, or conveyance of the Property or any interest therein as and to the extent required by this Agreement or the Mortgage; or (E) (1) if any petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law, shall be filed by Borrower or Guarantor, or (2) if Borrower or Guarantor files an answer consenting to, or otherwise joining in, any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law filed against it by any other Person, or is found pursuant to a final, unappealable order of a court of competent jurisdiction to have solicited or caused to be solicited creditors to file any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law against Borrower or Guarantor, or (3) if Borrower or Guarantor are found, pursuant to a final unappealable order of a court of competent jurisdiction, to have been in collusion with creditors that initiate a bankruptcy action or proceeding against Borrower or Guarantor or (F) an Event of Default described in Section 8.1(s) hereof shall have occurred.Xxxxxxx,
Appears in 1 contract
Samples: Loan Agreement (Black Creek Diversified Property Fund Inc.)
Exculpation. Subject Notwithstanding anything to the qualifications belowcontrary contained herein, Lender it is agreed (a) that if Landlord or any successor in interest is a corporation, there shall not enforce be no personal liability on the liability and part of any stockholder, officer or director of such corporation or any subsidiary, affiliate, joint venturer, or partner of such corporation with respect to any obligation of Borrower the Landlord hereunder or in connection herewith, and (b) that if Landlord is a firm, partnership, joint venture or association, there shall be no personal liability on the part of any partner, general or limited, or member thereof with respect to any obligations hereunder or in connection herewith. If Landlord shall be in breach or default with respect to its obligations under this Lease, Tenant agrees (a) that it shall look solely to the estate, equity and interest of Landlord in the land and building of which the Leased Premises forms a part for the collection of any judgment (or other judicial process) requiring the payment of money by Landlord in the event of any default or breach by Landlord hereunder and (b) that there shall be no personal liability on the part of Landlord or its constituent membersstockholders, partners, shareholdersofficers, directors, employees subsidiaries, affiliates, joint venturers, partners or agents or members for the direct or indirect constituent members, partners, shareholders, directors, employees or agents thereof (collectively, the “Borrower Parties”) or any other Person, to perform and observe the obligations contained in this Agreement, the Note or any collection of the other Loan Documents by any action or proceeding wherein a money judgment shall be sought against any of the Borrower Parties or any other Person, except that Lender may bring a foreclosure action, an action for specific performance or any other appropriate action or proceeding to enable Lender to enforce and realize upon the Property, the Rents or any other collateral given to Lender pursuant to this Agreement and the other Loan Documents; provided, however, that, except as specifically provided herein, any judgment in any such action judgment or proceeding shall be enforceable against the Borrower Parties only to the extent of other judicial process beyond their interest respective interests in the Property, land and building of which the Rents and in any other collateral given to Lender, and Lender, by accepting this Agreement, the Note and the other Loan Documents, agrees that it shall not sxx for, seek or demand any deficiency judgment against any of the Borrower Parties or any other Person in any such action or proceeding under or by reason of or in connection with this Agreement, the Note or any of the other Loan DocumentsLeased Premises form a part. The provisions of this paragraph hereof shall not, however, (i) constitute a waiver, release or impairment of any obligation evidenced or secured by this Agreement, the Note or any of the other Loan Documents; (ii) impair the right of Lender to name any of the Borrower Parties, as a party defendant in any action or suit for foreclosure and sale under the Mortgage; (iii) affect the validity or enforceability of any guaranty made in connection with the Loan or any rights and remedies of Lender thereunder; (iv) impair the right of Lender to obtain the appointment of a receiver; (v) impair the enforcement of the Assignment of Leases and Rents; or (vi) constitute be deemed a waiver or modification of Tenant's rights or Landlord's obligations under this Lease, nor shall it prevent Tenant from obtaining judgment against the right Landlord in case of Lender to enforce the liability and obligation of Borrower (but not against any members of Borrower (other than Guarantor such breach or default to the extent provided in that the Non-Recourse Guaranty) same shall be a lien against Landlord's equity or their direct interest therein, nor from asserting any setoff or indirect constituent members deduction against the rents payable under this Lease to which Tenant may be entitled under this Lease, or partners or any other Person), by money judgment or otherwise, to the extent of any loss, damage, cost, expense, liability, claim or other obligation (but excluding any punitive, consequential or speculative damages) incurred by Lender (including attorneys’ fees and costs reasonably incurred) arising out of or in connection with the following:
(a) fraud or intentional misrepresentation by Borrower or Guarantor in connection with the Loan;
(b) intentional physical waste of the Property (including, but not limited to, waste due to gross negligence) by Borrower or any affiliate thereof; provided, however, such physical waste shall exclude wear and tear to the Property that occurs in the ordinary course of business of the Property by Borrower or any affiliate thereof;
(c) the material breach of any representation, warranty, covenant or indemnification provision in the Environmental Indemnity or in this Agreement concerning Environmental Laws, Hazardous Substances and Asbestos;
(d) the removal or disposal by Borrower or any affiliate thereof of any portion of the Property after an Event of Default has occurred and while it is continuing, unless such portion of the Property is replaced by an item of equal or greater value as determined by Lender in its reasonable discretion;
(e) the misapplication or conversion by Borrower or any affiliate thereof of (i) any insurance proceeds paid by reason of any loss, damage or destruction to the Property, (ii) any awards or other amounts received in connection with the condemnation of all or a portion of the Property, (iii) any Rents following an Event of Default or (iv) any Rents paid more than one (1) month in advance;
(f) failure to pay charges for labor or materials or taxes or other charges that can create liens superior to the lien of the Mortgage on any portion of the Property unless such taxes or other charges are being contested in accordance herewith or such taxes or charges have been delivered to Lender in accordance with Section 3.3 hereof or Borrower has complied with Section 5.2 hereof; and
(g) any security deposits collected by Borrower or any affiliate thereof with respect to the Property which are not delivered to Lender upon a foreclosure of the Property or action in lieu thereof, except to the extent any such security deposits were applied in accordance with the terms and conditions of any of the Leases prior to the occurrence of the Event of Default that gave rise to such foreclosure or action in lieu thereof. Notwithstanding anything to the contrary in any of the Loan Documents (i) Lender shall not be deemed to have waived any right which Lender may have under Section 506(a), 506(b), 1111(b) or any other provisions of the U.S. Bankruptcy Code to file a claim for the full amount of the Debt or to require that all collateral shall continue to secure all of the Debt owing to Lender in accordance with the Loan Documents, and (ii) the Debt shall become fully recourse to Borrower (but not its members (other than Guarantor solely to the extent provided in the Non-Recourse Guaranty) or other direct or indirect constituent members or partners or any other Person) in the event that: (A) the first full Monthly Debt Service Payment Amount (as defined in the Note) under the Note is not paid when due; (B) other than in connection with a default under subsection (x) of the definition of Special Purpose Bankruptcy Remote Entity set forth in Schedule 5 hereto, Borrower fails to maintain its status as a Special Purpose Bankruptcy Remote Entity in accordance with the provisions of this Agreement and such failure results in the substantive consolidation of Borrower with another Person; (C) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any subordinate financing or other voluntary lien encumbering the Property; (D) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any assignment, transfer, or conveyance of the Property or any interest therein as and to the extent required by this Agreement or the Mortgage; or (E) (1) if any petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law, shall be filed by Borrower or Guarantor, or (2) if Borrower or Guarantor files an answer consenting to, or otherwise joining in, any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law filed against it by any other Person, or is found pursuant to a final, unappealable order of a court of competent jurisdiction to have solicited or caused to be solicited creditors to file any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law against Borrower or Guarantor, or (3) if Borrower or Guarantor are found, pursuant to a final unappealable order of a court of competent jurisdiction, to have been in collusion with creditors that initiate a bankruptcy action or proceeding against Borrower or Guarantor or (F) an Event of Default described in Section 8.1(s) hereof shall have occurredfavor.
Appears in 1 contract
Exculpation. (a) Subject to the qualifications below, Lender shall not enforce the liability and obligation of Borrower or its constituent members, partners, shareholders, directors, employees or agents or the direct or indirect constituent members, partners, shareholders, directors, employees or agents thereof (collectively, the “Borrower Parties”) or any other Person, to perform and observe the obligations contained in the Note, this Agreement, the Note Pledge Agreement or any of the other Loan Documents by any action or proceeding wherein a money judgment or any deficiency judgment or other judgment establishing personal liability shall be sought against Borrower, any other Borrower Party, or any principal, director, officer, employee, beneficiary, shareholder, partner, member, trustee, agent, or Affiliate of Borrower or any other Borrower Party or any legal representatives, successors or assigns of any of the Borrower Parties or any other Personforegoing (collectively, the “Exculpated Parties”), except that Lender may bring a foreclosure action, an action for specific performance or any other appropriate action or proceeding to enable Lender to enforce and realize upon its interest under the Note, this Agreement, the Pledge Agreement and the other Loan Documents, or in the Property, the Rents Collateral (or any portion thereof), or any other collateral given to Lender pursuant to this Agreement and the other Loan Documents; provided, however, that, except as specifically provided herein, any judgment in any such action or proceeding shall be enforceable against the Borrower Parties only to the extent of their Borrower’s interest in the Property, in the Rents Collateral and in any other collateral given to Lender, and Lender, by accepting the Note, this Agreement, the Note Pledge Agreement and the other Loan Documents, agrees that it shall not sxx sue for, seek or demand any deficiency judgment against Borrower or any of the Borrower Exculpated Parties or any other Person in any such action or proceeding under or by reason of or under or in connection with the Note, this Agreement, the Note Pledge Agreement or any of the other Loan Documents. The provisions of this paragraph Section shall not, however, (i1) constitute a waiver, release or impairment of any obligation evidenced or secured by this Agreement, the Note or any of the other Loan Documents; (ii2) impair the right of Lender to name any of the Borrower Parties, as a party defendant in any action or suit for foreclosure and sale under the MortgagePledge Agreement; (iii3) affect the validity or enforceability of any indemnity, guaranty or similar instrument (including, without limitation, indemnities set forth in Article 12 hereof, Section 11.2 hereof, in the Guaranty and the Environmental Indemnity) made in connection with the Loan or any of the rights and remedies of Lender thereunderthereunder (including, without limitation, Xxxxxx’s right to enforce said rights and remedies against Xxxxxxxx and/or Guarantor (as applicable) personally and without the effect of the exculpatory provisions of this Article 13); (iv4) impair the rights of Lender to (A) obtain the appointment of a receiver and/or (B) enforce its rights and remedies provided in Articles 8 and 9 hereof; (5) impair the enforcement of the Pledge Agreement or any other Loan Documents; (6) impair the right of Lender to obtain the appointment enforce Section 4.12(e) of a receiverthis Agreement; (v7) impair constitute a prohibition against Lender to seek a deficiency judgment against Borrower in order to fully realize the enforcement of security granted by the Assignment of Leases and RentsPledge Agreement or to commence any other appropriate action or proceeding in order for Lender to exercise its remedies against the Property (or any portion thereof) and/or the Collateral (or any portion thereof); or (vi) 8) constitute a waiver of the right of Lender to enforce the liability and obligation of Borrower (but not against any members of Borrower (other than Guarantor to the extent provided in the Non-Recourse Guaranty) or their direct or indirect constituent members or partners or any other Person)Borrower, by money judgment or otherwise, to the extent of any loss, damage, cost, expense, liability, claim or other obligation (but excluding any punitive, consequential or speculative damages) Loss actually incurred by Lender (including reasonable attorneys’ fees and costs reasonably incurred) arising out of or in connection with the following:
(ai) fraud or intentional material misrepresentation by Borrower Xxxxxxxx, Mortgage Borrower, Mezzanine B Borrower, any SPE Component Entity, any Mortgage SPE Component Entity, any Mezzanine B SPE Component Entity, Sponsor, any Affiliated Manager, Guarantor or Guarantor any director, officer, beneficiary, shareholder, partner, member, employee or agent acting on behalf of any of the foregoing (each, a “Recourse Party”) in connection with the Loan;
(bii) intentional willful misconduct of any Recourse Party in connection with the Loan;
(iii) the breach of any indemnification provision in the Loan Documents or the Mortgage Loan Documents concerning environmental laws, hazardous substances and asbestos and any indemnification of Lender with respect thereto;
(iv) material physical waste to any Property caused by the intentional acts of the Property (includingany Recourse Party, but not limited to, waste due only to gross negligence) by Borrower or any affiliate thereof; provided, however, the extent there is sufficient cash flow from the Properties to prevent such physical waste shall exclude wear and tear such cash flow is made available by (x) Mortgage Lender for the purpose of preventing such physical waste from the applicable Mortgage Loan Reserve Accounts after all conditions to such release had been met to the Property that occurs extent sums sufficient to pay or perform such liability have been deposited with Mortgage Lender in accordance with the terms of the Mortgage Loan Agreement or (y) Lender for the purpose of preventing such physical waste from Accounts (if any) after all conditions to such release had been met to the extent sums sufficient to pay or perform such liability have been deposited with Lender in accordance with the terms of this Agreement;
(v) the removal of any property in contravention of the Loan Documents during the continuance of an Event of Default other than in the ordinary course of business of the Property by Borrower or any affiliate thereofbusiness;
(cvi) the material breach misappropriation or conversion of any representation, warranty, covenant or indemnification provision in the Environmental Indemnity or in this Agreement concerning Environmental Laws, Hazardous Substances and Asbestos;
(d) the removal or disposal by Borrower or any affiliate thereof of any portion of the Property after an Event of Default has occurred and while it is continuing, unless such portion following by a Recourse Party in contravention of the Property is replaced by an item of equal or greater value as determined by Lender in its reasonable discretion;
Loan Documents: (e) the misapplication or conversion by Borrower or any affiliate thereof of (iA) any insurance proceeds paid received by Borrower by reason of any loss, damage or destruction to the PropertyCasualty, (iiB) any awards Awards or other amounts received by Borrower from a governmental authority in connection with the condemnation a Condemnation of all or a portion of the Property, (iiiC) any Rents following an Event revenues generated by the Properties, (E) any proceeds received by Mortgage Borrower or Borrower under any owner’s title insurance policy, (F) any distributions or other payments made in violation of Default this Agreement, or (ivG) any Rents paid more than one (1) month in advanceNet Liquidation Proceeds After Debt Service;
(f) failure to pay charges for labor or materials or taxes or other charges that can create liens superior to the lien of the Mortgage on any portion of the Property unless such taxes or other charges are being contested in accordance herewith or such taxes or charges have been delivered to Lender in accordance with Section 3.3 hereof or Borrower has complied with Section 5.2 hereof; and
(gvii) any security Security Deposits, advance deposits or any other deposits collected by Borrower or any affiliate thereof with respect to the any Property which are not delivered to Lender upon a foreclosure of the such Property or action in lieu thereof, except to the extent any such security deposits Security Deposits were delivered to Mortgage Lender in accordance with the Mortgage Loan Agreement and/or applied in accordance with the terms and conditions of any of the Leases applicable Lease;
(viii) any litigation or other legal proceeding related to the Loan filed by a Recourse Party with the effect of delaying, opposing, impeding, obstructing, hindering, enjoining or otherwise interfering with the efforts of Xxxxxx to exercise any rights and remedies available to Lender during the continuance of an Event of Default; provided, however, that there shall be no liability hereunder on account of, and the foregoing shall not restrict, Xxxxxxxx’s or Guarantor’s right to, dispute, in good faith, whether the relevant Event of Default shall have occurred or whether an action taken by Lender pursuant to the Loan Documents is permitted thereby, nor shall Borrower be restricted from, or have liability hereunder for, bringing a good faith counterclaim which if not raised in the foreclosure proceeding would be barred, and which does not seek to enjoin the enforcement action by Xxxxxx;
(ix) Borrower fails to obtain Xxxxxx’s prior written consent to any additional indebtedness or voluntary lien encumbering any Property, the Collateral and not permitted by the Loan Documents;
(x) Intentionally omitted;
(xi) intentionally omitted;
(xii) (A) any voluntary termination of any PILOT Lease and/or PILOT Document or transfer or surrender of any PILOT Lease and/or PILOT Document (including any PILOT Bond) by Mortgage Borrower without Xxxxxx’s prior written consent other than in connection with Mortgage Borrower acquiring the fee estate from the applicable PILOT Lessor or as otherwise expressly permitted under this Agreement or (B) Mortgage Borrower’s or the applicable Tenant’s failure to comply with or Mortgage Borrower’s or the applicable Tenant’s breach of any PILOT Lease and/or PILOT Document that results in (x) a reduction of any tax abatement and/or mandatory repayment of any past or current tax abatement under such PILOT Lease and/or PILOT Document, as applicable, (y) termination of such PILOT Lease and/or PILOT Document, as applicable, and the benefits thereunder in favor of Mortgage Borrower or Tenant or (z) a default by such Mortgage Borrower under the applicable Lease for such PILOT Property (and, in any such case, Losses shall include lost rental income); provided, that, in each case, the liability with respect to this Section 13.1(a)(xii) shall not exceed the Allocated Loan Amount of the applicable PILOT Property;
(xiii) other than as set forth in Section 13.1(b)(v), a breach by Borrower of any covenant of Article 5 of this Agreement documents (excluding any provision requiring Borrower to remain solvent, maintain adequate capital or pay its debts as they come due);
(xiv) any liability or obligation of Borrower or Mortgage Borrower relating to the Previously-Owned Property;
(xv) incurrence of liens encumbering any Property, the Collateral or the direct or indirect interests in Borrower or Mortgage Borrower;
(xvi) any Borrower Party enters into Material Agreements in violation of this Agreement;
(xvii) unsecured indebtedness and indemnification obligations of Mortgage Borrower, in each instance, in contravention of the Loan Documents;
(xviii) if any Affiliate of Borrower purchases all or any part of the Mortgage Loan;
(xix) any obligation of Borrower or Mortgage Borrower (a) to indemnify any Person that, immediately prior to any acquisition of title to the Collateral pursuant to a UCC foreclosure sale, a UCC strict foreclosure, an assignment in lieu of foreclosure or other enforcement action under the Loan Documents (collectively, an “Equity Collateral Enforcement Action”) was an Affiliate of Borrower or Mortgage Borrower, or (b) to pay any amounts due under any contract or agreement between Borrower or Mortgage Borrower, on the one hand, and any Person that, immediately prior to an Equity Collateral Enforcement Action, was an Affiliate of Borrower or Mortgage Borrower, on the other hand; and/or (c) to pay legal fees to any legal counsel engaged by Borrower or Mortgage Borrower or any Affiliate of Borrower or Mortgage Borrower prior to the occurrence date of the Event consummation of Default that gave rise to such foreclosure an Equity Collateral Enforcement Action; and/or
(xx) any breach of any representation, warranty or action covenant contained in lieu thereof. Section 10 of the Pledge Agreement.
(b) Notwithstanding anything to the contrary in this Agreement, the Note or any of the Loan Documents Documents, (iA) Lender shall not be deemed to have waived any right which Lender may have under Section 506(a), 506(b), 1111(b) or any other provisions of the U.S. Bankruptcy Code to file a claim for the full amount of the Debt or to require that all collateral shall continue to secure all of the Debt owing to Lender in accordance with the Loan Documents, and (iiB) the Debt shall become be fully recourse to Borrower (but not its members (other than Guarantor solely to the extent provided in the Non-Recourse Guaranty) or other direct or indirect constituent members or partners or any other Person) in the event that: (Ai) the first full Monthly Debt Service Payment Amount (as defined Borrower or any SPE Component Entity or any Affiliate thereof files, or joins in the Note) filing of, a petition against Borrower under the Note is not paid when due; Bankruptcy Code or any other Federal or state bankruptcy or insolvency law, or solicits or causes to be solicited (Bor otherwise colludes with) petitioning creditors for any involuntary petition against Borrower, (ii) Borrower or any SPE Component Entity or any Affiliate thereof files an answer consenting to an involuntary petition filed against Borrower (other than any answer which is required to be made by applicable law), by any other person under the Bankruptcy Code or any other federal or state bankruptcy or insolvency law, (iii) Borrower or any SPE Component Entity consents to or joins in an application for the appointment of a custodian, receiver, trustee, or examiner for Xxxxxxxx (other than with the prior written consent of Lender), (iv) Borrower makes an assignment for the benefit of creditors (other than to Lender in connection with a default under subsection the Loan or with the prior written consent of Lender), provided, that, with respect to the Mortgage Loan only, (x) the exercise of remedies under the Mortgage Loan or the Loan shall not by itself trigger recourse liability to Borrower or Guarantor, and (y) Guarantor shall not have liability for matters first arising after a foreclosure or assignment-in-lieu of foreclosure of the definition Mortgage Loan or the Loan or for actions taken by Mortgage Lender or by Lender pursuant to the exercise of Special any voting proxy or similar rights to exercise control over the Collateral, except, in each case, to the extent due to the actions of Guarantor or its Affiliates; (v) there is a breach of any provision of Article 5 (Single Purpose Entity Covenants) hereof or the separateness covenants contained in the Borrower’s or SPE Component Entity’s organizational documents (excluding, in each case, any provision requiring Borrower to remain solvent, maintain adequate capital or pay its debts as they come due) and such breach is cited by a court of competent jurisdiction in a final order in a proceeding under the Bankruptcy Remote Entity set forth in Schedule 5 hereto, Borrower fails to maintain its status Code as a Special Purpose Bankruptcy Remote Entity material factor in accordance with the provisions of this Agreement and such failure results in ordering the substantive consolidation of Borrower or Mortgage Borrower with another any other Person; provided that the motion or pleading seeking substantive consolidation was not brought or supported by Xxxxxx and, as a result thereof, Borrower is subsequently substantively consolidated in a case under the Bankruptcy Code with any Person other than a co-Borrower under the Loan, (Cvi) except as otherwise permitted pursuant Borrower fails to obtain Xxxxxx’s prior consent to (a) the transfer or conveyance of all or any portion of any Property or the Collateral, (b) the transfer of any direct or indirect equity interests in Borrower, any SPE Component Entity, any Mortgage Borrower, any Mortgage SPE Component Entity, or Mezzanine B Borrower, or (c) the granting of any security interest in the direct equity interests in any Mortgage Borrower or any Mortgage SPE Component Entity, in each case in violation of the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any subordinate financing or other voluntary lien encumbering the Property; (Dvii) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any assignment, transfer, or conveyance violation of covenants regarding opting into Article 8 of the Property or any interest therein as and to the extent required by this Agreement or the Mortgage; or (E) (1) if any petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law, shall be filed by Borrower or Guarantor, or (2) if Borrower or Guarantor files an answer consenting to, or otherwise joining in, any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law filed against it by any other Person, or is found pursuant to a final, unappealable order of a court of competent jurisdiction to have solicited or caused to be solicited creditors to file any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law against Borrower or Guarantor, or (3) if Borrower or Guarantor are found, pursuant to a final unappealable order of a court of competent jurisdiction, to have been in collusion with creditors that initiate a bankruptcy action or proceeding against Borrower or Guarantor or (F) an Event of Default described in Section 8.1(s) hereof shall have occurredUCC.
Appears in 1 contract
Samples: Mezzanine Loan Agreement (Industrial Logistics Properties Trust)
Exculpation. Subject to the qualifications below, Lender shall not enforce the liability and obligation of Borrower or its constituent members, partners, shareholders, directors, employees or agents or the direct or indirect constituent members, partners, shareholders, directors, employees or agents thereof (collectively, the “Borrower Parties”) or any other Person, to perform and observe the obligations contained in the Note, this Agreement, the Note Mortgage or any of the other Loan Documents by any action or proceeding wherein a money judgment or any deficiency judgment or other judgment establishing personal liability shall be sought against Borrower or any principal, director, officer, employee, beneficiary, shareholder, partner, member, trustee, agent, or affiliate of Borrower (but specifically excluding Guarantor) or any legal representatives, successors or assigns of any of the Borrower Parties or any other Personforegoing (collectively, the “Exculpated Parties”), except that Lender may bring a foreclosure action, an action for specific performance or any other appropriate action or proceeding to enable Lender to enforce and realize upon its interest under the Note, this Agreement, the Mortgage and the other Loan Documents, or in the Property, the Rents Rents, or any other collateral given to Lender pursuant to this Agreement and the other Loan Documents; provided, however, that, except as specifically provided herein, any judgment in any such action or proceeding shall be enforceable against the Borrower Parties only to the extent of their Borrower’s interest in the Property, in the Rents and in any other collateral given to Lender, and Lender, by accepting the Note, this Agreement, the Note Mortgage and the other Loan Documents, agrees that it shall not sxx xxx for, seek or demand any deficiency judgment against Borrower or any of the Borrower Exculpated Parties or any other Person in any such action or proceeding under or by reason of or under or in connection with the Note, this Agreement, the Note Mortgage or any of the other Loan Documents. The provisions of this paragraph Section shall not, however, (ia) constitute a waiver, release or impairment of any obligation evidenced or secured by this Agreement, the Note or any of the other Loan Documents; (iib) impair the right of Lender to name any of the Borrower Parties, as a party defendant in any action or suit for foreclosure and sale under the Mortgage; (iiic) affect the validity or enforceability of any indemnity, guaranty or similar instrument made in connection with the Loan or any of the rights and remedies of Lender thereunder; (ivd) impair the right of Lender to obtain the appointment of a receiver; (ve) impair the enforcement of the Assignment of Leases and RentsLeases; (f) impair the right of Lender to enforce Section 4.1.6(g) of this Agreement; (g) constitute a prohibition against Lender to seek a deficiency judgment against Borrower in order to fully realize the security granted by the Mortgage or to commence any other appropriate action or proceeding in order for Lender to exercise its remedies against the Property; or (vih) constitute a waiver of the right of Lender to enforce the liability and obligation of Borrower (but not against any members of Borrower (other than Guarantor to the extent provided in the Non-Recourse Guaranty) or their direct or indirect constituent members or partners or any other Person)Borrower, by money judgment or otherwise, to the extent of any loss, damage, cost, expense, liability, claim or other obligation (but excluding any punitive, consequential or speculative damages) incurred by Lender (including attorneys’ fees and costs reasonably incurred) arising out of or in connection with the following:
(ai) fraud or intentional misrepresentation by Borrower Borrower, any of the Exculpated Parties, Sponsor or Guarantor in connection with the Loan;
(bii) intentional physical waste the gross negligence or willful misconduct of the Property (including, but not limited to, waste due to gross negligence) by Borrower or any affiliate thereof; provided, however, such physical waste shall exclude wear and tear to the Property that occurs in the ordinary course of business of the Property by Borrower or any affiliate thereofBorrower;
(ciii) the material breach of any representation, warranty, covenant or indemnification provision in the Environmental Indemnity or in this Agreement the Mortgage concerning Environmental Lawsenvironmental laws, Hazardous Substances hazardous substances and Asbestosasbestos and any indemnification of Lender with respect thereto in either document;
(div) the removal or disposal by Borrower or any affiliate thereof of any portion of the Property after an Event of Default has occurred and while it is continuing, unless such portion of the Property is replaced by an item of equal or greater value as determined by Lender in its reasonable discretionDefault;
(ev) the misapplication misapplication, misappropriation or conversion by Borrower or any affiliate thereof of (iA) any insurance proceeds paid by reason of any loss, damage or destruction to the Property, (iiB) any awards Awards or other amounts received in connection with the condemnation Condemnation of all or a portion of the Property, (iiiC) any Rents following an Event of Default or (ivD) any Tenant security deposits or Rents paid more than one (1) month collected in advance;
(fvi) failure to pay charges for labor or materials or taxes or other charges that can create liens superior to the lien of the Mortgage Liens on any portion of the Property unless such taxes or other charges are being contested in accordance herewith or such taxes or charges have been delivered to Lender in accordance with Section 3.3 hereof or Borrower has complied with Section 5.2 hereof; andProperty;
(gvii) any security deposits, advance deposits or any other deposits collected by Borrower or any affiliate thereof with respect to the Property which are not delivered to Lender upon a foreclosure of the Property or action in lieu thereof, except to the extent any such security deposits were applied in accordance with the terms and conditions of any of the Leases prior to the occurrence of the Event of Default that gave rise to such foreclosure or action in lieu thereof;
(viii) any representation, warranty or covenant contained in Section 2.5.2 or 6.5 hereof is violated or breached;
(ix) Borrower’s indemnification of Lender set forth in Section 9.2 of the Security Instrument;
(x) the exercise of any remedies, or the bringing of any action, by the District of Columbia under Section 22.2(b) of the Development Agreement;
(xi) any misstatement or inaccuracy in that certain Real Property Recordation and Transfer Tax Form FP 7/C filed in connection with Mortgage;
(xii) Borrower’s failure to deliver evidence satisfactory to Lender evidencing the valid transfer of development rights from the adjoining property to the Property such that the Property shall be in conformance with the building density requirements and zoning regulations of the District of Columbia: and/or
(xiii) Borrower’s indemnification of Lender set forth in Section 9.2 hereof. Notwithstanding anything to the contrary in this Agreement, the Note or any of the Loan Documents Documents, (iA) Lender shall not be deemed to have waived any right which Lender may have under Section 506(a), 506(b), 1111(b1111 (b) or any other provisions of the U.S. Bankruptcy Code to file a claim for the full amount of the Debt or to require that all collateral shall continue to secure all of the Debt owing to Lender in accordance with the Loan Documents, and (ii) the Debt shall become fully recourse to Borrower (but not its members (other than Guarantor solely to the extent provided in the Non-Recourse Guaranty) or other direct or indirect constituent members or partners or any other Person) in the event that: (A) the first full Monthly Debt Service Payment Amount (as defined in the Note) under the Note is not paid when due; (B) other than in connection with a default under subsection (x) of the definition of Special Purpose Bankruptcy Remote Entity set forth in Schedule 5 hereto, Borrower fails to maintain its status as a Special Purpose Bankruptcy Remote Entity in accordance with the provisions of this Agreement and such failure results in the substantive consolidation of Borrower with another Person; (C) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any subordinate financing or other voluntary lien encumbering the Property; (D) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any assignment, transfer, or conveyance of the Property or any interest therein as and to the extent required by this Agreement or the Mortgage; or (E) (1) if any petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law, shall be filed by Borrower or Guarantor, or (2) if Borrower or Guarantor files an answer consenting to, or otherwise joining in, any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law filed against it by any other Person, or is found pursuant to a final, unappealable order of a court of competent jurisdiction to have solicited or caused to be solicited creditors to file any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law against Borrower or Guarantor, or (3) if Borrower or Guarantor are found, pursuant to a final unappealable order of a court of competent jurisdiction, to have been in collusion with creditors that initiate a bankruptcy action or proceeding against Borrower or Guarantor or (F) an Event of Default described in Section 8.1(s) hereof shall have occurred.Code
Appears in 1 contract
Exculpation. Subject (a) Notwithstanding anything to the qualifications belowcontrary contained in this Note, the Security Instrument or any Other Security Document (but subject to the provisions of subsections (b), (c) and (d) of this Article 11), Lender shall not enforce the liability and obligation of Borrower or its constituent members, partners, shareholders, directors, employees or agents or the direct or indirect constituent members, partners, shareholders, directors, employees or agents thereof (collectively, the “Borrower Parties”) or any other Person, to perform and observe the obligations contained in this Agreement, the Note or any of the other Loan Documents Security Instrument by any action or proceeding wherein a money judgment or any deficiency judgment or other judgment establishing any personal liability shall be sought against Borrower or any principal, director, officer, employee, beneficiary, shareholder, partner, member, trustee, agent or affiliate of Borrower or any person owning, directly or indirectly, any legal or beneficial interest in Borrower, or any successors or assigns of any of the Borrower Parties or any other Personforegoing (collectively, the "Exculpated Parties"), except that Lender may bring a foreclosure action, an action for specific performance or any other appropriate action or proceeding to enable Lender to enforce and realize upon this Note, the Security Instrument, the Other Security Documents, and the interest in the Property, the Rents or (as defined in the Security Instrument) and any other collateral given to Lender pursuant to secure this Agreement and the other Loan Documents; Note, provided, however, thatsubject to the provisions of subsections (b), except as specifically provided herein(c) and (d) of this Article 11, that any judgment in any such action or proceeding shall be enforceable against the Borrower Parties only to the extent of their Borrower's interest in the Property, in the Rents and in any other collateral cxxxxxxxxl given to Lender, and Lender to secure this Note Lender, by accepting this Agreement, the Note and the other Loan DocumentsSecurity Instrument, agrees that it shall not sxx not, except as otherwise provided in this Article 11, sue for, seek or demand any deficiency judgment against Borrower or any of the Borrower Parties or any other Person Exculpated Parties, in any such action or proceeding proceeding, under or by reason of or under or in connection with this AgreementNote, the Note Security Instrument or any of the other Loan Other Security Documents. The provisions of this paragraph Article 11 shall not, however, (i) constitute a waiver, release or impairment of any obligation evidenced or secured by this AgreementNote, the Note Security Instrument or any of the other Loan DocumentsOther Security Documents delivered to Lender; (ii) impair the right of Lender to name any of the Borrower Parties, as a party defendant in any action or suit for judicial foreclosure and sale under the Mortgage; Security Instrument, (iii) affect the validity or enforceability of any guaranty indemnity, guaranty, master lease or similar instrument made in connection with this Note, the Loan Security Instrument, or any rights and remedies of Lender thereunder; the Other Security Documents, (iv) impair the right of Lender to obtain the appointment of a receiver; (v) impair the enforcement of the Assignment of Leases and Rents; or Rents executed in connection herewith, (vi) constitute a waiver of impair the right of Lender to enforce the liability and obligation provisions of Section 12.2 of the Security Instrument or of Section 3 12(e) of the Security Instrument; or (vii) impair the right of Lender to obtain a deficiency judgment or other judgment on the Note against Borrower if necessary to fully realize the security granted by the Security Instrument or to commence any other appropriate action or proceeding in order for Lender to exercise its remedies against the Property.
(but not against any members b) Notwithstanding the provisions of Borrower (other than Guarantor this Article 11 to the extent provided contrary, Borrower shall be personally liable to Lender for the Losses (as defined in the Non-Recourse GuarantySecurity Instrument) or their direct or indirect constituent members or partners or any other Person), by money judgment or otherwise, to the extent of any loss, damage, cost, expense, liability, claim or other obligation Lender incurs due to: (but excluding any punitive, consequential or speculative damages) incurred by Lender (including attorneys’ fees and costs reasonably incurred) arising out of or in connection with the following:
(ai) fraud or intentional misrepresentation by Borrower or Guarantor any of the Exculpated Parties in connection with the Loan;
; (b) intentional physical waste of the Property (including, but not limited to, waste due to gross negligence) by Borrower or any affiliate thereof; provided, however, such physical waste shall exclude wear and tear to the Property that occurs in the ordinary course of business of the Property by Borrower or any affiliate thereof;
(cii) the material breach gross negligence or willful misconduct of any representationBorrower, warranty, covenant or indemnification provision in the Environmental Indemnity or in this Agreement concerning Environmental Laws, Hazardous Substances and Asbestos;
(diii) the removal or disposal by Borrower or any affiliate thereof of any portion of the Property after an Event of Default has occurred and while it is continuing, unless such portion of the Property is replaced by an item of equal or greater value as determined by Lender in its reasonable discretion;
(e) the misapplication or conversion by Borrower or any affiliate thereof of (i) any insurance proceeds paid by reason of any loss, damage or destruction to the Property, (ii) any awards or other amounts received in connection with the condemnation of all or a portion of the Property, (iii) any Rents following an Event of Default or (iv) any Rents paid more than one (1) month in advance;
(f) failure to pay charges for labor or materials or taxes or other charges that can create liens superior to the lien of the Mortgage on any portion of the Property unless such taxes or other charges are being contested in accordance herewith or such taxes or charges have been delivered to Lender in accordance with Section 3.3 hereof or Borrower has complied with Section 5.2 hereof; and
(g) any security deposits collected by Borrower or any affiliate thereof with respect to the Property which are not delivered to Lender upon a foreclosure of the Property or action in lieu thereof, except to the extent any such security deposits were applied in accordance with the terms and conditions of any of the Leases prior to the occurrence of the Event of Default that gave rise to such foreclosure or action in lieu thereof. Notwithstanding anything to the contrary in any of the Loan Documents (i) Lender shall not be deemed to have waived any right which Lender may have under Section 506(a), 506(b), 1111(b) or any other provisions of the U.S. Bankruptcy Code to file a claim for the full amount of the Debt or to require that all collateral shall continue to secure all of the Debt owing to Lender in accordance with the Loan Documents, and (ii) the Debt shall become fully recourse to Borrower (but not its members (other than Guarantor solely to the extent provided in the Non-Recourse Guaranty) or other direct or indirect constituent members or partners or any other Person) in the event that: (A) the first full Monthly Debt Service Payment Amount (as defined in the Note) under the Note is not paid when due; (B) other than in connection with a default under subsection (x) of the definition of Special Purpose Bankruptcy Remote Entity set forth in Schedule 5 hereto, Borrower fails to maintain its status as a Special Purpose Bankruptcy Remote Entity in accordance with the provisions of this Agreement and such failure results in the substantive consolidation of Borrower with another Person; (C) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any subordinate financing or other voluntary lien encumbering the Property; (D) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any assignment, transfer, or conveyance of the Property or any interest therein as and to the extent required by this Agreement or the Mortgage; or (E) (1) if any petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law, shall be filed by Borrower or Guarantor, or (2) if Borrower or Guarantor files an answer consenting to, or otherwise joining in, any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law filed against it by any other Person, or is found pursuant to a final, unappealable order of a court of competent jurisdiction to have solicited or caused to be solicited creditors to file any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law against Borrower or Guarantor, or (3) if Borrower or Guarantor are found, pursuant to a final unappealable order of a court of competent jurisdiction, to have been in collusion with creditors that initiate a bankruptcy action or proceeding against Borrower or Guarantor or (F) an Event of Default described in Section 8.1(s) hereof shall have occurredDefault.
Appears in 1 contract
Exculpation. Subject to the qualifications below, Lender Agent shall not enforce the liability and obligation of Borrower or its constituent members, partners, shareholders, directors, employees or agents or the direct or indirect constituent members, partners, shareholders, directors, employees or agents thereof (collectively, the “Borrower Parties”) or any other Person, to perform and observe the obligations contained in the Note, this Agreement, the Note Security Instrument, the Pledge Agreement or any of the other Loan Documents by any action or proceeding wherein a money judgment or any deficiency judgment or other judgment establishing personal liability shall be sought against Borrower or any principal, director, officer, employee, beneficiary, shareholder, partner, member, trustee, agent, or Affiliate of Borrower (but specifically excluding Guarantor) or any legal representatives, successors or assigns of any of the Borrower Parties or any other Personforegoing (collectively, the “Exculpated Parties”), except that Lender Agent may bring a foreclosure action, an action for specific performance or any other appropriate action or proceeding to enable Lender Agent to enforce and realize upon its interest under the Note, this Agreement, the Security Instrument, the Pledge Agreement and the other Loan Documents, or in the Property, the Rents and Profits, the Equity Collateral or any other collateral given to Agent or Lender pursuant to this Agreement and the other Loan Documents; provided, however, that, except as specifically provided herein, any judgment in any such action or proceeding shall be enforceable against the Borrower Parties only to the extent of their Borrower’s interest in the Property, in the Rents and Profits, the Equity Collateral and in any other collateral given to Agent or Lender, and LenderAgent, by accepting the Note, this Agreement, the Note Security Instrument, the Pledge Agreement and the other Loan Documents, agrees that it shall not sxx sue for, seek or demand any deficiency judgment against Borrower or any of the Borrower Exculpated Parties or any other Person in any such action or proceeding under or by reason of or under or in connection with the Note, this Agreement, the Note Security Instrument, the Pledge Agreement or any of the other Loan Documents. The provisions of this paragraph Section shall not, however, (i1) constitute a waiver, release or impairment of any obligation evidenced or secured by this Agreement, the Note or any of the other Loan Documents; (ii2) impair the right of Lender Agent to name any of the Borrower Parties, as a party defendant in any action or suit for foreclosure and or sale under the MortgageSecurity Instrument or the Pledge Agreement; (iii3) affect the validity or enforceability of any indemnity, guaranty or similar instrument (including, without limitation, the indemnities set forth in Article 11 hereof, Section 13.2 hereof, in the Guaranty and in the Environmental Indemnity) made in connection with the Loan or any of the rights and remedies of Lender thereunderAgent thereunder (including, without limitation, Agent’s right to enforce said rights and remedies against Xxxxxxxx and/or Guarantor (as applicable) personally and without the effect of the exculpatory provisions of this Article 12); (iv4) impair the right of Lender Agent to obtain the appointment of a receiver; (v5) impair the enforcement of the Assignment assignment of Leases leases and Rentsrents contained in the Security Instrument or other Loan Documents; (6) impair the right of Agent to enforce Section 7.12(e) of this Agreement; (7) constitute a prohibition against Agent to seek a deficiency judgment against Borrower in order to fully realize the security granted by the Security Instrument or the Pledge Agreement or to commence any other appropriate action or proceeding in order for Agent to exercise its remedies against the Property or the Equity Collateral; or (vi) 8) constitute a waiver of the right of Lender Agent to enforce the liability and obligation of Borrower (but not against any members of Borrower (other than Guarantor to the extent provided in the Non-Recourse Guaranty) or their direct or indirect constituent members or partners or any other Person)Borrower, by money judgment or otherwise, to the extent of any loss, damage, cost, expense, liability, claim or other obligation (but excluding any punitive, consequential or speculative damages) Losses incurred by Lender Agent (including attorneys’ fees and costs reasonably incurred) arising out of or in connection with any of the following:
(a) fraud or intentional misrepresentation by Borrower or Guarantor in connection with the Loan;
(b) intentional physical waste of the Property (including, but not limited to, waste due to gross negligence) by Borrower or any affiliate thereof; provided, however, such physical waste shall exclude wear and tear to the Property that occurs in the ordinary course of business of the Property by Borrower or any affiliate thereof;
(c) the material breach of any representation, warranty, covenant or indemnification provision in the Environmental Indemnity or in this Agreement concerning Environmental Laws, Hazardous Substances and Asbestos;
(d) the removal or disposal by Borrower or any affiliate thereof of any portion of the Property after an Event of Default has occurred and while it is continuing, unless such portion of the Property is replaced by an item of equal or greater value as determined by Lender in its reasonable discretion;
(e) the misapplication or conversion by Borrower or any affiliate thereof of (i) any insurance proceeds paid by reason of any loss, damage or destruction to the Property, (ii) any awards or other amounts received in connection with the condemnation of all or a portion of the Property, (iii) any Rents following an Event of Default or (iv) any Rents paid more than one (1) month in advance;
(f) failure to pay charges for labor or materials or taxes or other charges that can create liens superior to the lien of the Mortgage on any portion of the Property unless such taxes or other charges are being contested in accordance herewith or such taxes or charges have been delivered to Lender in accordance with Section 3.3 hereof or Borrower has complied with Section 5.2 hereof; and
(g) any security deposits collected by Borrower or any affiliate thereof with respect to the Property which are not delivered to Lender upon a foreclosure of the Property or action in lieu thereof, except to the extent any such security deposits were applied in accordance with the terms and conditions of any of the Leases prior to the occurrence of the Event of Default that gave rise to such foreclosure or action in lieu thereof. Notwithstanding anything to the contrary in any of the Loan Documents (i) Lender shall not be deemed to have waived any right which Lender may have under Section 506(a), 506(b), 1111(b) or any other provisions of the U.S. Bankruptcy Code to file a claim for the full amount of the Debt or to require that all collateral shall continue to secure all of the Debt owing to Lender in accordance with the Loan Documents, and (ii) the Debt shall become fully recourse to Borrower (but not its members (other than Guarantor solely to the extent provided in the Non-Recourse Guaranty) or other direct or indirect constituent members or partners or any other Person) in the event that: (A) the first full Monthly Debt Service Payment Amount (as defined in the Note) under the Note is not paid when due; (B) other than in connection with a default under subsection (x) of the definition of Special Purpose Bankruptcy Remote Entity set forth in Schedule 5 hereto, Borrower fails to maintain its status as a Special Purpose Bankruptcy Remote Entity in accordance with the provisions of this Agreement and such failure results in the substantive consolidation of Borrower with another Person; (C) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any subordinate financing or other voluntary lien encumbering the Property; (D) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any assignment, transfer, or conveyance of the Property or any interest therein as and to the extent required by this Agreement or the Mortgage; or (E) (1) if any petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law, shall be filed by Borrower or Guarantor, or (2) if Borrower or Guarantor files an answer consenting to, or otherwise joining in, any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law filed against it by any other Person, or is found pursuant to a final, unappealable order of a court of competent jurisdiction to have solicited or caused to be solicited creditors to file any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law against Borrower or Guarantor, or (3) if Borrower or Guarantor are found, pursuant to a final unappealable order of a court of competent jurisdiction, to have been in collusion with creditors that initiate a bankruptcy action or proceeding against Borrower or Guarantor or (F) an Event of Default described in Section 8.1(s) hereof shall have occurred.
Appears in 1 contract
Samples: Loan Agreement (CaliberCos Inc.)
Exculpation. Subject Notwithstanding any provision in this Agreement to the qualifications belowcontrary, Lender it is agreed and understood that Purchaser and Seller shall not enforce look solely to the liability and obligation assets of Borrower the other party (including without limitation the Property in the case of Seller) in the event of any breach or its constituent members, partners, shareholders, directors, employees or agents or the direct or indirect constituent members, partners, shareholders, directors, employees or agents thereof (collectively, the “Borrower Parties”) or any default by such other Person, to perform and observe the obligations contained in party under this Agreement, and not to the Note assets of: (a) any person or entity which is a partner or shareholder of such other party, or which otherwise owns or holds any ownership interest in such other party, directly or indirectly (each such partner or other holder or owner of any interest in Seller being referred to herein as a “Subtier Owner”); (b) any person or entity which is a partner in or otherwise owns or holds any ownership interest in any Subtier Owner, whether directly or indirectly; (c) any person or entity serving as an officer, director, employee or otherwise for or in such other party; or (d) any person or entity serving as an officer, director, employee or otherwise for or in any Subtier Owner. This Agreement is executed by one or more persons (the “Signatories”, whether one or more) of Seller and Purchaser solely in their capacities as representatives of the other Loan Documents by Seller, Purchaser or a Subtier Owner of Seller and Purchaser and not in their own individual capacities. Purchaser and Seller hereby release and relinquish the Signatories from any action and all personal liability for any matters or proceeding wherein a money judgment shall be sought against claims of any of the Borrower Parties or any other Person, except that Lender may bring a foreclosure action, an action for specific performance or any other appropriate action or proceeding to enable Lender to enforce and realize upon the Property, the Rents or any other collateral given to Lender pursuant to this Agreement and the other Loan Documents; provided, however, that, except as specifically provided herein, any judgment in any such action or proceeding shall be enforceable against the Borrower Parties only to the extent of their interest in the Property, the Rents and in any other collateral given to Lender, and Lender, by accepting this Agreement, the Note and the other Loan Documents, agrees that it shall not sxx for, seek or demand any deficiency judgment against any of the Borrower Parties or any other Person in any such action or proceeding kind which arise under or by reason of or in connection with or as a result of this Agreement, the Note or any of the other Loan Documents. The provisions foregoing release of this paragraph liability shall not, however, (i) constitute a waiver, release or impairment of any obligation evidenced or secured by this Agreement, the Note or any of the other Loan Documents; (ii) impair the right of Lender to name any of the Borrower Parties, as a party defendant in any action or suit for foreclosure and sale under the Mortgage; (iii) affect the validity or enforceability of any guaranty made in connection with the Loan or any rights and remedies of Lender thereunder; (iv) impair the right of Lender to obtain the appointment of a receiver; (v) impair the enforcement of the Assignment of Leases and Rents; or (vi) constitute a waiver of the right of Lender to enforce the liability and obligation of Borrower (but not against any members of Borrower (other than Guarantor to the extent provided in the Non-Recourse Guaranty) or their direct or indirect constituent members or partners or any other Person), by money judgment or otherwise, to the extent of any loss, damage, cost, expense, liability, claim or other obligation (but excluding any punitive, consequential or speculative damages) incurred by Lender (including attorneys’ fees and costs reasonably incurred) arising out of or in connection with the following:
(a) fraud or intentional misrepresentation by Borrower or Guarantor in connection with the Loan;
(b) intentional physical waste of the Property (including, but not limited to, waste due to gross negligence) by Borrower or any affiliate thereof; provided, however, such physical waste shall exclude wear and tear to the Property that occurs in the ordinary course of business of the Property by Borrower or any affiliate thereof;
(c) the material breach of any representation, warranty, covenant or indemnification provision in the Environmental Indemnity or in this Agreement concerning Environmental Laws, Hazardous Substances and Asbestos;
(d) the removal or disposal by Borrower or any affiliate thereof of any portion of the Property after an Event of Default has occurred and while it is continuing, unless such portion of the Property is replaced by an item of equal or greater value as determined by Lender in its reasonable discretion;
(e) the misapplication or conversion by Borrower or any affiliate thereof of (i) any insurance proceeds paid by reason of any loss, damage or destruction to the Property, (ii) any awards or other amounts received in connection with the condemnation of all or a portion of the Property, (iii) any Rents following an Event of Default or (iv) any Rents paid more than one (1) month in advance;
(f) failure to pay charges for labor or materials or taxes or other charges that can create liens superior to the lien of the Mortgage on any portion of the Property unless such taxes or other charges are being contested in accordance herewith or such taxes or charges have been delivered to Lender in accordance with Section 3.3 hereof or Borrower has complied with Section 5.2 hereof; and
(g) any security deposits collected by Borrower or any affiliate thereof be effective with respect to and shall apply to all claims against any owners of Seller and Purchaser and any owners of any Subtier Owner regardless of whether such claims arise as a result of any liability which the Property which are not delivered to Lender upon a foreclosure Signatories may have as owners of the Property or action in lieu thereofSeller, except to the extent any such security deposits were applied in accordance with the terms and conditions of any of the Leases prior to the occurrence of the Event of Default that gave rise to such foreclosure or action in lieu thereof. Notwithstanding anything to the contrary in any of the Loan Documents (i) Lender shall not be deemed to have waived any right which Lender may have under Section 506(a), 506(b), 1111(b) Purchaser or any other provisions of the U.S. Bankruptcy Code to file a claim for the full amount of the Debt or to require that all collateral shall continue to secure all of the Debt owing to Lender in accordance with the Loan Documents, and (ii) the Debt shall become fully recourse to Borrower (but not its members (other than Guarantor solely to the extent provided in the Non-Recourse Guaranty) or other direct or indirect constituent members or partners or any other Person) in the event that: (A) the first full Monthly Debt Service Payment Amount (as defined in the Note) under the Note is not paid when due; (B) other than in connection with a default under subsection (x) of the definition of Special Purpose Bankruptcy Remote Entity set forth in Schedule 5 hereto, Borrower fails to maintain its status as a Special Purpose Bankruptcy Remote Entity in accordance with the provisions of this Agreement and such failure results in the substantive consolidation of Borrower with another Person; (C) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any subordinate financing or other voluntary lien encumbering the Property; (D) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any assignment, transferSubtier Owner, or conveyance of the Property or any interest therein as and to the extent required by this Agreement or the Mortgage; or (E) (1) if any petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law, shall be filed by Borrower or Guarantor, or (2) if Borrower or Guarantor files an answer consenting to, or otherwise joining in, any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law filed against it by any other Person, or is found pursuant to a final, unappealable order of a court of competent jurisdiction to have solicited or caused to be solicited creditors to file any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law against Borrower or Guarantor, or (3) if Borrower or Guarantor are found, pursuant to a final unappealable order of a court of competent jurisdiction, to have been in collusion with creditors that initiate a bankruptcy action or proceeding against Borrower or Guarantor or (F) an Event of Default described in Section 8.1(s) hereof shall have occurredotherwise.
Appears in 1 contract
Exculpation. Subject to the qualifications below, Lender shall not enforce the liability and obligation of any Borrower or its constituent members, partners, shareholders, directors, employees or agents or the direct or indirect constituent members, partners, shareholders, directors, employees or agents thereof (collectively, the “Borrower Parties”) or and/or any other Person, Operating Lessee to perform and observe the obligations Obligations contained in the Note, this Agreement, the Note Mortgages or any of the other Loan Documents by any action or proceeding wherein a money judgment shall be sought against any of the such Borrower Parties or any other Personsuch Operating Lessee, except that Lender may bring a foreclosure action, an action for specific performance or any other appropriate action or proceeding to enable Lender to enforce and realize upon its interest under the PropertyNote, this Agreement, the Rents Mortgages and the other Loan Documents, or in all or any of the Properties, the Gross Revenues or any other collateral given to Lender pursuant to this Agreement and the other Loan Documents; provided, however, that, except as specifically provided herein, any judgment in any such action or proceeding shall be enforceable against the a Borrower Parties or an Operating Lessee only to the extent of their such Borrower’s or such Operating Lessee’s interest in the PropertyProperties, in the Rents Gross Revenues and in any other collateral given to Lender, and Lender, by accepting the Note, this Agreement, the Note Mortgages and the other Loan Documents, agrees that it shall not sxx for, seek or demand any deficiency judgment against any of the a Borrower Parties or any other Person an Operating Lessee in any such action or proceeding under or by reason of or under or in connection with the Note, this Agreement, the Note Mortgages or any of the other Loan Documents. The provisions of this paragraph Section 10.1 shall not, however, (ia) constitute a waiver, release or impairment of any obligation evidenced or secured by this Agreement, the Note or any of the other Loan Documents; (iib) impair the right of Lender to name any of the Borrower Parties, one or more Borrowers or Operating Lessees as a party defendant in any action or suit for foreclosure and sale under the any Mortgage; (iiic) affect the validity or enforceability of any of the Loan Documents or any guaranty made in connection with the Loan or any of the rights and remedies of Lender thereunder; (ivd) impair the right of Lender to obtain the appointment of a receiver; (ve) impair the enforcement of the Assignment Assignments of Leases and RentsLeases; (f) impair the enforcement of the Environmental Indemnity; (g) constitute a prohibition against Lender to seek a deficiency judgment against all or any of the Borrowers or Operating Lessees in order to fully realize the security granted by any Mortgage or to commence any other appropriate action or proceeding in order for Lender to exercise its remedies against all or any of the Properties; or (vih) constitute a waiver of the right of Lender to enforce the liability and obligation of Borrower (but not against any members of Borrower (other than Guarantor to the extent provided in the Non-Recourse Guaranty) Borrowers or their direct or indirect constituent members or partners or any other Person), Operating Lessees by money judgment or otherwise, to the extent of any actual loss, damage, cost, expense, liability, claim or other obligation (but excluding any punitive, consequential or speculative damages) incurred by Lender (including attorneys’ fees and costs reasonably incurred) (collectively, “Losses”) arising out of or in connection with the following:following (all such liability and obligation of Borrowers and Operating Lessees for any Losses for or all of the following being referred to herein as “Borrowers’ Recourse Liabilities”):
(ai) fraud fraud, willful misconduct, intentional misrepresentation or intentional misrepresentation failure to disclose a material fact by Borrower or on behalf of any Borrower, any Operating Lessee or any Guarantor in connection with the Loan, including by reason of any claim under the Racketeer Influenced and Corrupt Organizations Act (RICO);
(bii) gross negligence or willful misconduct of any Borrower, any Operating Lessee or any Guarantor in connection with the Loan or any Property;
(iii) intentional physical waste removal or destruction of any material portion of any Property or disposal of any material portion of any Property in violation of the Property Loan Documents (including, but not limited to, waste due to gross negligenceunless (A) such portion shall be replaced by Borrower property of the same utility and of the same or any affiliate thereof; provided, however, greater value or (B) such physical waste shall exclude wear and tear to the Property that occurs removal or disposal is in the ordinary course of the applicable Borrower’s business or is otherwise approved in writing by Lender);
(iv) any intentional, material physical waste of any of the Property Properties;
(v) the forfeiture by any Borrower or any affiliate Operating Lessee of any Property, or any portion thereof, because of the conduct of criminal activity by any Borrower, any Operating Lessee or any Guarantor or any of their respective agents or representatives in connection therewith;
(cvi) the material breach intentional misappropriation or conversion by or on behalf of any representation, warranty, covenant or indemnification provision in the Environmental Indemnity or in this Agreement concerning Environmental Laws, Hazardous Substances and Asbestos;
(d) the removal or disposal by Borrower or any affiliate thereof of any portion of the Property after an Event of Default has occurred and while it is continuing, unless such portion of the Property is replaced by an item of equal or greater value as determined by Lender in its reasonable discretion;
(e) the misapplication or conversion by Borrower or any affiliate thereof Operating Lessee of (iA) any insurance proceeds Insurance Proceeds paid by reason of any loss, damage or destruction to the any Property, (iiB) any awards Awards or other amounts received in connection with the condemnation Condemnation of all or a portion of the any Property, or (iiiC) any Rents following an Event Gross Revenues (including Rents, Insurance Proceeds, security deposits (if any) or failure to deliver security deposits (if any) to Lender in accordance with the provisions of Default the Loan Documents, advance deposits or any other deposits and Lease termination payments) or (ivD) any Rents paid more than one (1) month other funds due under the Loan Documents, including, in advanceconnection with any intentional misappropriation or conversion by or on behalf of any Borrower or any Operating Lessee pursuant to any of the foregoing, by reason of failure to comply with Section 6.1 hereof or breach of the Clearing Account Agreement or the Cash Management Agreement;
(fvii) failure to pay charges for labor or materials or taxes or other charges that can create liens superior to the lien of the Mortgage Liens on any portion of the any Property unless (subject to Borrowers’ right to contest such taxes or other charges are being contested in accordance herewith or such taxes or charges have been delivered to Lender in accordance with Section 3.3 hereof or Borrower has complied with Section 5.2 hereof; and
(g) any security deposits collected by Borrower or any affiliate thereof with respect to the Property which are not delivered to Lender upon a foreclosure of the Property or action in lieu thereof, except to the extent any such security deposits were applied in accordance with the terms and conditions of any of the Leases prior to the occurrence of the Event of Default that gave rise to such foreclosure or action in lieu thereof. Notwithstanding anything to the contrary in any of the Loan Documents (i) Lender shall not be deemed to have waived any right which Lender may have under Section 506(a), 506(b), 1111(b) or any other provisions of the U.S. Bankruptcy Code to file a claim for the full amount of the Debt or to require that all collateral shall continue to secure all of the Debt owing to Lender in accordance with the Loan Documents, and (ii) the Debt shall become fully recourse to Borrower (but not its members (other than Guarantor solely to the extent provided in the Non-Recourse Guaranty) or other direct or indirect constituent members or partners or any other Person) in the event that: (A) the first full Monthly Debt Service Payment Amount (as defined in the Note) under the Note is not paid when due; (B) other than in connection with a default under subsection (x) of the definition of Special Purpose Bankruptcy Remote Entity set forth in Schedule 5 hereto, Borrower fails to maintain its status as a Special Purpose Bankruptcy Remote Entity Liens in accordance with the provisions of this Section 4.3 hereof);
(viii) the failure to pay Taxes or transfer taxes; unless (A) funds to pay such Taxes were, at the time in question, available in the Tax Account and Lender failed to pay (or make such Tax Funds available to pay) such Taxes or (B) Rents received during the tax period in question are insufficient to pay all of Borrowers’ current and/or past due liabilities (including such Taxes) with respect to the Properties;
(ix) failure to obtain and maintain the fully paid for Policies in accordance with Section 5.1.1 hereof; unless (A) funds to pay such Insurance Premiums were, at the time in question, available in the Insurance Account and Lender failed to pay (or make such Insurance Funds available to pay) such Insurance Premiums or (B) Rents received during the period in question are insufficient to pay all of Borrowers’ current and/or past due liabilities (including such Insurance Premiums) with respect to the Property;
(x) a termination of any Franchise Agreement as a result of or arising out of any Borrower’s or any Operating Lessee’s default thereunder;
(xi) Borrowers’ and such failure results Operating Lessees’ indemnification of Lender set forth in Section 9.2 hereof;
(xii) a material breach of the covenants set forth in Section 4.4 hereof (other than those covenants set forth in clauses (f), (j) and (v) of Schedule V attached hereto) that does not result in the substantive consolidation of Borrower the assets and liabilities of Borrowers and/or Operating Lessees with another Personany other Person as a result of such breach; and/or
(Cxiii) except as otherwise permitted pursuant to the Loan Documentsany intentional act or omission of any Borrower, Borrower fails to obtain Operating Lessee or Guarantor made frivolously or in bad faith which hinders, delays or interferes in any material respect with Lender’s prior written consent to enforcement of its rights under any subordinate financing Loan Document or other voluntary lien encumbering the Property; (D) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any assignment, transfer, or conveyance realization of the Property collateral, including any assertion of defenses or counterclaims by any interest therein as and to the extent required by this Agreement or the Mortgage; or (E) (1) if any petition for bankruptcyBorrower, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law, shall be filed by Borrower or Guarantor, or (2) if Borrower Operating Lessee or Guarantor files an answer consenting to, made frivolously or otherwise joining in, any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law filed against it by any other Person, or is found pursuant to a final, unappealable order of a court of competent jurisdiction to have solicited or caused to be solicited creditors to file any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law against Borrower or Guarantor, or (3) if Borrower or Guarantor are found, pursuant to a final unappealable order of a court of competent jurisdiction, to have been in collusion with creditors that initiate a bankruptcy action or proceeding against Borrower or Guarantor or (F) an Event of Default described in Section 8.1(s) hereof shall have occurredbad faith.
Appears in 1 contract
Samples: Loan Agreement (American Realty Capital Hospitality Trust, Inc.)
Exculpation. Subject Notwithstanding anything to the contrary contained in this Agreement, the Note, the Mortgage or the other Loan Documents but subject to the qualifications below, Lender shall not enforce the liability and obligation of Borrower or its constituent members, partners, shareholders, directors, employees or agents or the direct or indirect constituent members, partners, shareholders, directors, employees or agents thereof (collectively, the “Borrower Parties”) or any other Person, to perform and observe the obligations contained in the Note, this Agreement, the Note Mortgage or any of the other Loan Documents by any action or proceeding wherein a money judgment shall be sought against any of the Borrower Parties or any other PersonBorrower, except that Lender may bring a foreclosure action, an action for specific performance or any other appropriate action or proceeding to enable Lender to enforce and realize upon its interest under the Note, this Agreement, the Mortgage and the other Loan Documents, or in the Property, the Rents Rents, or any other collateral given to Lender pursuant to this Agreement and the other Loan Documents; provided, however, that, except as specifically provided herein, any judgment in any such action or proceeding shall be enforceable against the Borrower Parties only to the extent of their Borrower’s interest in the Property, in the Rents and in any other collateral given to Lender, and Lender, by accepting the Note, this Agreement, the Note Mortgage and the other Loan Documents, agrees that it shall not sxx xxx for, seek or demand any deficiency judgment against any of the Borrower Parties or any other Person in any such action or proceeding under under, or by reason of of, or in connection with with, the Note, this Agreement, the Note Mortgage or any of the other Loan Documents. The provisions of this paragraph Section 9.4 shall not, however, (ia) constitute a waiver, release or impairment of any obligation evidenced or secured by this Agreement, the Note or any of the other Loan Documents; (iib) impair the right of Lender to name any of the Borrower Parties, as a party defendant in any action or suit for foreclosure and sale under the Mortgage; (iiic) affect the validity or enforceability of or any guaranty Guaranty made in connection with the Loan or any of the rights ‑103 ‑ and remedies of Lender thereunder; (ivd) impair the right of Lender to obtain the appointment of a receiver; (ve) impair the enforcement of the Assignment of Leases and RentsLeases; (f) constitute a prohibition against Lender seeking a deficiency judgment against Borrower in order to fully realize the security granted by the Mortgage or commencing any other appropriate action or proceeding in order for Lender to exercise its remedies against the Property; or (vig) constitute a waiver of the right of Lender to enforce the liability and obligation of Borrower (but not against any members of Borrower (other than Guarantor to the extent provided in the Non-Recourse Guaranty) or their direct or indirect constituent members or partners or any other Person)Borrower, by money judgment or otherwise, to the extent of any loss, damage, cost, expense, liability, claim or other obligation (but excluding any punitive, consequential or speculative damages) incurred by Lender (including attorneys’ fees and costs reasonably incurred) arising out of or in connection with the following:
(ai) fraud or intentional willful misrepresentation by or on behalf of Borrower or Guarantor or any Affiliate of any of them in connection with the LoanLoan or the Property;
(bii) intentional physical waste the willful misconduct of the Property (includingBorrower, but not limited to, waste due to gross negligence) by Borrower Guarantor or any affiliate thereof; provided, however, such physical waste shall exclude wear and tear to Affiliate of any of them in connection with the Property that occurs in Loan or the ordinary course of business of the Property by Borrower or any affiliate thereofProperty;
(ciii) the material breach of any representation, warranty, covenant or indemnification provision in the Environmental Indemnity or in Indemnity, this Agreement or the Mortgage concerning Environmental Laws, Laws or Hazardous Substances and AsbestosSubstances;
(div) the wrongful removal or disposal by Borrower or any affiliate thereof destruction of any portion of the Property after an Event of Default has occurred and while it is continuing, unless such portion or any intentional or grossly negligent physical waste of the Property is replaced Property, in either case by an item or on behalf of equal Borrower, Guarantor or greater value as determined by Lender in its reasonable discretionany Affiliate of any of them;
(ev) the breach of any Legal Requirement (including, without limitation, RICO) mandating the forfeiture by Borrower of the Property, or any portion thereof, because of the conduct or purported conduct of criminal activity by Borrower or any Restricted Party in connection therewith;
(vi) the failure to pay Taxes, to the extent that Gross Revenues of the Property, net of Debt Service and any other amounts payable hereunder or under the other Loan Documents, are sufficient to pay such amounts, except to the extent that (A) sums sufficient to pay such amounts have been deposited into escrow with Lender pursuant to Section 7.2 or (B) Borrower is contesting Taxes in accordance with the terms of Section 5.1.2 or (C) such failure occurs during an Excess Cash Sweep Period and Lender does not make funds available for payment of Taxes, if applicable;
(vii) the misapplication or conversion by or on behalf of Borrower or any affiliate thereof of (iA) any insurance proceeds Insurance Proceeds paid by reason of any loss, damage or destruction to the PropertyCasualty, (iiB) any awards or other amounts Awards received in connection with the condemnation of all or a portion of the PropertyCondemnation, (iiiC) any Rents following collected during the continuance of an Event of Default Default, or (ivD) any Rents paid more than one (1) month in advance;
(fviii) the failure to pay charges for labor or materials or taxes or other charges incurred by or on behalf of Borrower, Guarantor or any Affiliate of any of them that can create liens superior Liens on the Property (including any portion thereof) to the lien of the Mortgage on any portion of the Property unless extent such taxes Liens are not bonded over or other charges are being contested in accordance herewith or such taxes or charges have been delivered to Lender discharged in accordance with Section 3.3 hereof this Agreement or Borrower has complied with Section 5.2 hereofthe other Loan Documents; and‑104 ‑
(gix) the failure of any security deposits, advance deposits or any other deposits collected by Borrower or any affiliate thereof with respect to the Property which are not to be delivered to Lender upon a foreclosure of the Property or action in lieu thereof, except to the extent any such security deposits were applied in accordance with the terms and conditions of any of the Leases prior to the occurrence of the Event of Default that gave rise to such foreclosure or action in lieu thereof. Notwithstanding anything ;
(x) the failure of Borrower to maintain its status as a Single Purpose Entity;
(xi) the contrary in amendment, modification or waiver of any of the Loan Documents terms or provisions of the Freeport Lease or any replacement lease that is a lease of the entire Demised Premises (ia “Replacement Lease”) Lender shall not that would result in a reduction of rent or other payments required to be deemed made by the tenant thereunder or a shortening of the primary term of the Freeport Lease or Replacement Lease (other than an amendment or modification pursuant to have waived any right which Lender may have under Section 506(athe terms of the Freeport Lease or Replacement Lease) or the termination of the Freeport Lease or Replacement Lease or the cancellation or acceptance of a surrender of the Freeport Lease or Replacement Lease (other than a termination, cancellation or acceptance of surrender of the Freeport Lease or Replacement Lease as a result of a default by the tenant thereunder or a Material Action involving the tenant thereunder or a termination of the Freeport Lease or Replacement Lease with respect to the Property pursuant to the terms of the Freeport Lease or Replacement Lease), 506(b)in each case, 1111(bwithout Lender’s prior written consent (or deemed consent) pursuant to the applicable provisions of this Agreement;
(xii) the Development Lease is amended, modified or any of the terms or provisions of the Development Lease are waived, in each case without Lender’s prior written consent; or
(xiii) any Condominium Document is amended, modified or any of the terms or provisions of any Condominium Document are waived, in each case without Lender’s prior written consent.
(a) Borrower filing a voluntary petition under the Bankruptcy Code or any other provisions Federal or state bankruptcy or insolvency law; (b) the filing by any Person of an involuntary petition against Borrower under the U.S. Bankruptcy Code to file a claim for the full amount of the Debt or to require that all collateral shall continue to secure all of the Debt owing to Lender in accordance with the Loan Documents, and (ii) the Debt shall become fully recourse to Borrower (but not its members (other than Guarantor solely to the extent provided in the Non-Recourse Guaranty) or other direct or indirect constituent members or partners or any other PersonFederal or state bankruptcy or insolvency law, in which Borrower or Guarantor or any Person Controlling Borrower or Guarantor colludes with or solicits or causes to be solicited petitioning creditors; (c) Borrower or Guarantor or any Person Controlling Borrower or Guarantor colluding to arrange and thereafter filing an answer consenting to or otherwise acquiescing in or joining in any involuntary petition filed against it, by any other Person under the event that: Bankruptcy Code or any other Federal or state bankruptcy or insolvency law; (Ad) Borrower consenting to or otherwise acquiescing in or joining in an application for the appointment of a custodian, receiver, trustee, or ‑105 ‑ examiner for Borrower or the Property; or (e) Borrower making an assignment for the benefit of creditors, or admitting, in writing or in any legal proceeding, its insolvency or inability to pay its debts as they become due; (2) if the first full Monthly Debt Service Payment Amount (as defined in the Note) under the Note is not paid when due; (B3) other than in connection with a default under subsection (x) of the definition of Special Purpose Bankruptcy Remote Entity set forth in Schedule 5 hereto, Borrower fails to maintain its status as a Special Purpose Bankruptcy Remote Entity in accordance with the provisions of this Agreement and such failure results in the substantive consolidation of Borrower with another Person; (C) except as otherwise permitted pursuant to the Loan Documents, if Borrower fails to obtain Lender’s prior written consent to any subordinate financing Indebtedness or other voluntary lien Lien encumbering the Property; (D) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any assignment, transfer, or conveyance of the Property or any interest therein as and to the extent required by this Agreement or the Mortgage; or (E) (1) if any petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law, shall be filed by Borrower or Guarantor, or (24) if Borrower fails to obtain Lender’s prior written consent to any Transfer, to the extent required by this Agreement or Guarantor files an answer consenting tothe Mortgage; (5) the Development Lease is canceled, terminated or surrendered, or otherwise joining inthe purchase option under the Development Lease is exercised, any involuntary petition in each case without Lender’s prior written consent; (6) there is a merger of leasehold and fee estates of the Office Condominium, without Lender’s prior written consent; (7) the Condominium is canceled, terminated or surrendered, in each case without Lender’s prior written consent; or (8) the failure of Borrower to maintain its status as a Single Purpose Entity and such failure is the basis, in whole or in part, for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law filed against it by the substantive consolidation of the assets and liabilities of Borrower with the assets and liabilities of any other Person, or is found Person pursuant to a final, unappealable order of a court of competent jurisdiction to have solicited or caused to be solicited creditors to file any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law against Borrower or Guarantor, or (3) if Borrower or Guarantor are found, pursuant to a final unappealable order of a court of competent jurisdiction, to have been in collusion with creditors that initiate a bankruptcy action or proceeding against Borrower or Guarantor or (F) an Event of Default described in Section 8.1(s) hereof shall have occurredBankruptcy Action.
Appears in 1 contract
Samples: Loan Agreement (Cole Office & Industrial REIT (CCIT II), Inc.)
Exculpation. Subject to the qualifications below, Lender shall not enforce the liability and obligation of Borrower or its constituent members, partners, shareholders, directors, employees or agents or the direct or indirect constituent members, partners, shareholders, directors, employees or agents thereof (collectively, the “Borrower Parties”) or any other Person, to perform and observe the obligations contained in the Note, this Agreement, the Note any Mortgage or any of the other Loan Documents by any action or proceeding wherein a money judgment shall be sought proceeding, against Borrower (or any member, shareholder, partner or other owner of Borrower, or any director, officer, employee of any of the Borrower Parties or any other Personforegoing), except that Lender may bring a foreclosure action, an action for specific performance or any other appropriate action or proceeding to enable Lender to enforce and realize upon its interest under the Note, this Agreement, any Mortgage and the other Loan Documents, or in any Mortgaged Property, the Rents Rents, or any other collateral given to Lender pursuant to this Agreement and the other Loan Documents; provided, however, that, except as specifically provided hereinbelow in this Section 12.24, any judgment in any such action or proceeding shall be enforceable against the Borrower Parties only to the extent of their Borrower's interest in the any Mortgaged Property, the Rents and in any other collateral given to Lender, and Lender, by accepting the Note, this Agreement, the Note Mortgages and the other Loan Documents, agrees that it shall not sxx sue for, seek or demand any deficiency xxficiency judgment against any of the Borrower Parties or any other Person in any such action or proceeding under or by reason of or under or in connection with the Note, this Agreement, the Note any Mortgage or any of the other Loan DocumentsDocuments except for any deficiency judgment that shall be enforced solely against or collected solely from the Mortgaged Properties, the Rents or any other collateral given to Lender. The provisions of this paragraph Section shall not, however, (ia) constitute a waiver, release or impairment of any obligation evidenced or secured by this Agreement, the Note or any of the other Loan Documents; (iib) impair the right of Lender to name any of the Borrower Parties, as a party defendant in any action or suit for foreclosure and sale under the any Mortgage; (iiic) affect the validity or enforceability of or any separate guaranty or indemnity made in connection with the Loan or any of the rights and remedies of Lender thereunder; (ivd) impair the right of Lender to obtain the appointment of a receiver; (ve) impair constitute a prohibition against Lender to seek a deficiency judgment against Borrower in order to fully realize the enforcement of security granted by any Mortgage or to commence any other appropriate action or proceeding in order for Lender to exercise its remedies against the Assignment of Leases and RentsMortgaged Properties; or (vif) constitute a waiver of the right of Lender to enforce the liability and obligation of Borrower (but not against any members of Borrower (other than Guarantor to the extent provided in the Non-Recourse Guaranty) or their direct or indirect constituent members or partners or any other Person)Sponsor, by money judgment or otherwiseotherwise to be entered against Borrower and/or Sponsor, to the extent of any loss, damage, cost, expense, liability, claim or other obligation (but excluding any punitive, consequential or speculative damages) incurred by Lender (including attorneys’ ' fees and costs reasonably incurred) arising out of or in connection with (but only to the extent of) the following:
(ai) fraud or intentional misrepresentation by Borrower or Guarantor in connection with the LoanLoan or waste committed, permitted or suffered by Borrower;
(bii) intentional physical waste of any liability under the Property (including, but not limited to, waste due to gross negligence) by Borrower or any affiliate thereof; provided, however, such physical waste shall exclude wear and tear to the Property that occurs in the ordinary course of business of the Property by Borrower or any affiliate thereofEnvironmental Indemnity;
(c) the material breach of any representation, warranty, covenant or indemnification provision in the Environmental Indemnity or in this Agreement concerning Environmental Laws, Hazardous Substances and Asbestos;
(diii) the removal or disposal by Borrower or any affiliate thereof of any portion of the any Mortgaged Property after an Event of Default has occurred and while it is continuing, unless such portion of the Property is replaced by an item of equal or greater value as determined by Lender in its reasonable discretionDefault;
(eiv) the misapplication or conversion application by Borrower or any affiliate thereof of (i) any insurance proceeds paid by reason of any lossProceeds other than in accordance with the terms of this Agreement, damage or destruction to the Property, (ii) application of any awards Rents or other amounts received in connection with revenues from the condemnation of all or a portion of the PropertyMortgaged Properties, (iii) any Rents following an Event of Default Default, except to the Operating Expenses of the Mortgaged Properties or (iv) any Rents paid more than one (1) month in advanceto repay the Debt or other amounts due hereunder or under the other Loan Documents;
(fv) failure to pay charges for labor or materials or taxes or other charges that can create liens superior any security deposits collected with respect to the lien of the Mortgage on any portion of the Property unless such taxes or other charges Mortgaged Properties which are being contested in accordance herewith or such taxes or charges have been not delivered to Lender in accordance with Section 3.3 hereof this Agreement or Borrower has complied with Section 5.2 hereof; and
(g) any security deposits collected by Borrower or any affiliate thereof with respect to the Property which are not delivered to Lender upon a foreclosure of the any Mortgaged Property or action in lieu thereof, except to the extent any such security deposits were applied in accordance with the terms and conditions of any of the Leases prior to the occurrence of the Event of Default that gave rise to such foreclosure or action in lieu thereofthereof or in accordance with applicable law after the occurrence of such Event of Default; and
(vi) the indemnification and contribution rights in favor of Lender set forth in the Cooperation Agreement. Notwithstanding anything to the contrary in this Agreement or any of the Loan Documents (i) Documents, Lender shall not be deemed to have waived any right which Lender may have under Section 506(a), 506(b), ) or 1111(b) or any other provisions of the U.S. Bankruptcy Code to file a claim for the full amount of the Debt secured by the Mortgages or to require that all collateral shall continue to secure all of the Debt owing to Lender in accordance with the Loan Documents, and (ii) the Debt shall become fully recourse to Borrower (but not its members (other than Guarantor solely to the extent provided in the Non-Recourse Guaranty) or other direct or indirect constituent members or partners or any other Person) in the event that: (A) the first full Monthly Debt Service Payment Amount (as defined in the Note) under the Note is not paid when due; (B) other than in connection with a default under subsection (x) of the definition of Special Purpose Bankruptcy Remote Entity set forth in Schedule 5 hereto, Borrower fails to maintain its status as a Special Purpose Bankruptcy Remote Entity in accordance with the provisions of this Agreement and such failure results in the substantive consolidation of Borrower with another Person; (C) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any subordinate financing or other voluntary lien encumbering the Property; (D) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any assignment, transfer, or conveyance of the Property or any interest therein as and to the extent required by this Agreement or the Mortgage; or (E) (1) if any petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law, shall be filed by Borrower or Guarantor, or (2) if Borrower or Guarantor files an answer consenting to, or otherwise joining in, any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law filed against it by any other Person, or is found pursuant to a final, unappealable order of a court of competent jurisdiction to have solicited or caused to be solicited creditors to file any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law against Borrower or Guarantor, or (3) if Borrower or Guarantor are found, pursuant to a final unappealable order of a court of competent jurisdiction, to have been in collusion with creditors that initiate a bankruptcy action or proceeding against Borrower or Guarantor or (F) an Event of Default described in Section 8.1(s) hereof shall have occurred.
Appears in 1 contract
Exculpation. (a) Subject to the qualifications below, no recourse shall be had against, Lender shall not enforce the liability and obligation of Borrower or its constituent members, partners, shareholders, directors, employees or agents or the direct or indirect constituent members, partners, shareholders, directors, employees or agents thereof (collectively, the “Borrower Parties”) or any other Person, to perform and observe the obligations contained in the Note, this Agreement, the Note Pledge Agreement or any of the other Loan Documents by any action or proceeding wherein a money judgment or any deficiency judgment or other judgment establishing personal liability shall be sought against against, any Borrower Party or any direct or indirect principal, director, officer, employee, manager, beneficiary, parent, beneficial owner, shareholder, partner, member, trustee, agent, or Affiliate of any Borrower Party or any direct or indirect legal representatives, successors or assigns of any of the Borrower Parties or any other Personforegoing (collectively, the “Exculpated Parties”), except that Lender Lender, may bring a foreclosure action, an action for specific performance or any other appropriate action or proceeding to enforce the Note, this Agreement, the Pledge Agreement and the other Loan Documents, or to enable Lender to enforce and realize upon Lender’s interest in the Property, the Rents Collateral or any other collateral given to Lender pursuant to this Agreement and the other Loan Documents; provided, however, that, except as specifically provided herein, any judgment in any such action or proceeding shall be enforceable against the Borrower Parties only to the extent of their Borrower’s interest in the Property, the Rents Collateral and in any other collateral given to Lender, and Lender, by accepting the Note, this Agreement, the Note Pledge Agreement and the other Loan Documents, agrees that it shall not sxx for, seek or demand any deficiency judgment with respect to the Loan against Borrower or any of the Borrower Exculpated Parties or any other Person in any such action or proceeding under or by reason of or under or in connection with the Note, this Agreement, the Note or any of Pledge Agreement, the other Loan DocumentsDocuments or otherwise. The provisions of this paragraph Section shall not, however, (i1) constitute a waiver, release or impairment of any obligation evidenced or secured by this Agreement, the Note or any of the other Loan Documents; (ii2) impair the right of Lender to name any of the Borrower Parties, as a party defendant in any action or suit for foreclosure, exercise of any power of sale, or an assignment in lieu of foreclosure and sale under upon the MortgageCollateral or exercise of remedies pursuant to the Pledge Agreement; (iii3) affect the validity or enforceability of any Loan Document or any guaranty in connection with the Loan (including, without limitation, the indemnities set forth in Article 12 hereof, the Guaranty and the Environmental Indemnity) made in connection with the Loan or any of the rights and remedies of Lender thereunder; (iv4) intentionally omitted, (5) impair the right of Lender to (A) obtain the appointment of a receiverreceiver and/or (B) enforce its rights and remedies provided in Articles 8 and 9 hereof; (v6) impair the enforcement of Pledge Agreement or any other Loan Documents; (7) constitute a prohibition against Lender, to seek a deficiency judgment against Borrower in order to fully realize the Assignment of Leases and Rentssecurity granted by the Pledge Agreement or to commence any other appropriate action or proceeding in order for Lender to exercise Lender’s remedies against the Property or any portion thereof; or (vi) 8) constitute a waiver of the right of Lender to enforce the liability and obligation of Borrower (but not against any members of Borrower (other than Guarantor to the extent provided in the Non-Recourse Guaranty) or their direct or indirect constituent members or partners or any other Person)Borrower, by money judgment or otherwise, to the extent of any loss, damage, cost, expense, liability, claim or other obligation (but excluding any punitive, consequential or speculative damages) actual Losses incurred by Lender (including actual out-of-pocket attorneys’ fees and costs reasonably incurred) arising out of or in connection with the following:
(ai) fraud or intentional misrepresentation by any Borrower or Guarantor Party in connection with the Loan;
(bii) the willful misconduct of any Borrower Party in connection with the Loan;
(iii) any litigation or other legal proceeding (including, the raising of defenses) related to the Debt filed or raised by any Borrower Party that delays, opposes, impedes, obstructs, hinders, enjoins or otherwise interferes with or frustrates the efforts of Lender to exercise any rights and remedies available to Lender as provided herein and in the other Loan Documents which is found by a court of competent jurisdiction to be without merit or brought or raised, as applicable, in bad faith;
(iv) intentional physical waste of the Property (including, but not limited to, waste due to gross negligence) by Borrower or any affiliate thereof; provided, however, such physical waste shall exclude wear and tear to the Property that occurs in the ordinary course of business violation of the Property by Borrower or any affiliate thereof;
(c) the material breach terms of any representation, warranty, covenant or indemnification provision in the Environmental Indemnity or in this Agreement concerning Environmental Laws, Hazardous Substances and Asbestos;
(d) caused by any Borrower Party and/or the removal or disposal by Borrower or any affiliate thereof of any portion of the Property after in violation of the terms of this Agreement during the continuance of an Event of Default has occurred and while it is continuing, unless such portion of the Property is replaced by an item of equal or greater value as determined by Lender in its reasonable discretionDefault;
(ev) the misapplication misappropriation or conversion by any Borrower or any affiliate thereof Party, in contravention of the Loan Documents, of (iA) any insurance proceeds paid by reason of any loss, damage or destruction to the Property, (iiB) any awards Awards or other amounts received in connection with the condemnation Condemnation of all or a portion of the Property, (iiiC) any Rents following an Event of Default Rents, or (ivD) any Security Deposits or Rents paid more than one (1) month collected in advance;
(fvi) failure to the extent there exists sufficient cash flow from the Property to pay Taxes or charges for labor or materials or taxes or other charges that can create liens superior to the lien of the Mortgage on any portion of the Property Property, Borrower’s failure to pay or cause Mortgage Borrower to pay such Taxes or charges (except to the extent (A) sums sufficient to pay such Taxes or charges have been deposited with Mortgage Lender in accordance with the terms of the Mortgage Loan Agreement or (B) such cash flow is not being made available to Borrower by Mortgage Lender as a result of Mortgage Lender’s exercise of its remedies under the Mortgage Loan Documents) unless such taxes Taxes or other charges are being contested as permitted hereunder or under the Mortgage Loan Agreement;
(vii) to the extent there exists sufficient cash flow from the Property to pay Insurance Premiums and/or to maintain the Policies in accordance herewith full force and effect, Borrower’s failure to pay or cause Mortgage Borrower to pay such taxes or charges Insurance Premiums and/or to maintain the Policies in full force and effect, in each case, as expressly provided herein (except to the (A) extent sums sufficient to pay such Insurance Premiums and/or to maintain the Policies have been delivered to deposited with Mortgage Lender in accordance with Section 3.3 hereof the terms of the Mortgage Loan Agreement or (B) such cash flow is not being made available to Borrower has complied with Section 5.2 hereof; andby Mortgage Lender as a result of Mortgage Lender’s exercise of its remedies under the Mortgage Loan Documents);
(gviii) any security deposits collected by Borrower or any affiliate thereof with respect to the Property Security Deposits which are not delivered to Lender upon by a Borrower Party following a foreclosure of the Property or action in lieu thereof, except to the extent any such security deposits Security Deposits were (a) delivered to Mortgage Lender in accordance with the Mortgage Loan Documents or (b) applied in accordance with the terms and conditions of any of the applicable Leases prior to the occurrence of an Event of Default;
(ix) if as a result of the actions or inactions of Borrower or its Affiliates or Mortgage Borrower or its Affiliates (including, without limitation, Mortgage Borrower failing to comply with the terms of such Property Document) any Property Document is (A) materially modified in a manner adverse to Lender or Mortgage Borrower, (B) terminated, (C) cancelled or (D) otherwise ceases to exist, except in each of the foregoing cases, if such action or inaction of Borrower or its Affiliates or Mortgage Borrower or its Affiliates is permitted pursuant to the terms of this Agreement and/or Lender has approved the same;
(x) any representation, warranty or covenant contained in Article 5 hereof is violated or breached; provided, however, that solely with respect to a breach of Section 5.1(a)(vii) that arise from Borrower’s or Mortgage Borrower’s failure to pay trade and operational indebtedness, such breach shall not result in recourse under the Loan pursuant to this clause (x), if cash flow from the Property available to Borrower and/or Mortgage Borrower is not sufficient to pay such amounts;
(xi) except as set forth in Section 13.1(b) below, (A) Borrower fails to obtain Lender’s prior consent to any Prohibited Transfer as required by this Agreement (other than a Permitted Transfer) or (B) any covenant contained in Section 6.6 hereof is violated or breached;
(xii) any distributions to Borrower’s direct or indirect legal or beneficial owners after the occurrence and during the continuance of an Event of Default;
(xiii) any liabilities and obligations of Borrower or Mortgage Borrower: (i) accrued or accruing on or prior to any acquisition of title to the Collateral pursuant to a UCC foreclosure sale, a UCC strict foreclosure, an assignment in lieu of foreclosure or other enforcement action under the Loan Documents (collectively, an “Equity Collateral Enforcement Action”; and the date on which an Equity Collateral Enforcement Action is consummated, an “Equity Collateral Transfer Date”) with respect to indemnification obligations accrued or accruing in favor of Borrower, Mortgage Borrower or any Affiliate of Borrower and/or Mortgage Borrower (individually and collectively, a “Borrower Control Party”) under any organizational documents of any Borrower Control Party or any other agreement that was not either approved by Lender or entered into in compliance with this Agreement; (ii) without duplications of amounts paid or payable pursuant to Section 13.1(a)(iii) above, accrued or accruing prior to, on or after the Equity Collateral Transfer Date to pay legal fees to legal counsel engaged by any Borrower Control Party prior to the Equity Collateral Transfer Date if such legal fees were incurred to defend against an enforcement action under the Loan Documents; or (iii) accrued or accruing prior to, on or after the Equity Collateral Transfer Date under any agreement (a “Third Party Agreement”) between any Borrower Control Party, on the one hand, and any Person not Affiliated with Mortgage Borrower, on the other hand, that has been entered into during the continuance of an Event of Default that gave rise without the prior written approval of Lender to the extent such foreclosure prior written approval was required under the Loan Documents (unless such Third Party Agreement has been assumed in writing by the Person acquiring the Collateral on or after the Equity Collateral Transfer Date);
(xiv) Mortgage Borrower “opts out” of Article 8 of the UCC;
(xv) Borrower or any Borrower Party acquires all or any portion of any interest in the Mortgage Loan in violation of Section 4.33(a) hereof and votes or approves the undertaking of any enforcement action under the Mortgage Loan; and/or
(xvi) Mortgage Borrower gives notice of termination of the Restricted Account Agreement other than in lieu thereof. accordance with Section 8(d) of the Restricted Account Agreement in effect as of the Closing Date and the Restricted Account Agreement is terminated by Bank as a result of such notice.
(b) Notwithstanding anything to the contrary in this Agreement, the Note or any of the Loan Documents Documents, (iA) Lender shall not be deemed to have waived any right which Lender may have under Section 506(a), 506(b), 1111(b) or any other provisions of the U.S. Bankruptcy Code to file a claim for the full amount of the Debt or to require that all collateral shall continue to secure all of the Debt owing to Lender in accordance with the Loan Documents, and (iiB) the Debt shall become be fully recourse to Borrower (but not its members (other than Guarantor solely to the extent provided in the Non-Recourse Guaranty) or other direct or indirect constituent members or partners or any other Person) in the event that: :
(i) a Bankruptcy Event occurs;
(ii) any voluntary Sale or Pledge of the Property (other than (i) an easement (except for an easement affecting the Property that interferes or impairs in a material way Borrower’s ability to use and operate the Property as currently used or that otherwise has a Material Adverse Effect), (ii) a covenant or restriction that (A) does not interfere with or impair in a material way Borrower’s ability to use and operate the first full Monthly Debt Service Payment Amount (Property as defined in the Note) under the Note is not paid when due; currently used and (B) other than does not have a Material Adverse Effect, and (iii) a Lease entered into at the Property (except for a lease of all or a majority of the Property, a ground lease, or a master lease)), the Collateral or any direct or indirect interest in connection Borrower, Mortgage Borrower or Guarantor that results in a failure to comply with a default under subsection the Minimum Ownership/Control Test, in each case in violation of the terms of this Agreement (but excluding (x) any failure to comply with the requirements in any of clause (A), (D), (E), (G) or (H) appearing in the definition of Special Purpose Bankruptcy Remote Entity set forth “Permitted Transfer” in Schedule 5 hereto, Borrower fails to maintain its status as a Special Purpose Bankruptcy Remote Entity in accordance with the provisions Section 6.3 of this Agreement and such (y) any violation as a result of a failure results in of a Mezzanine Lender to comply with the substantive consolidation of Borrower with another Person; Intercreditor Agreement);
(Ciii) except as otherwise permitted pursuant to the Loan Documents, if Borrower fails to obtain Lender’s prior written consent (if and to the extent required under the Loan Documents) to (A) any subordinate financing or other voluntary lien liens encumbering the Property; Property that are not considered Permitted Encumbrances hereunder or (DB) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any assignment, transfer, subordinate financing or conveyance other voluntary liens encumbering: (1) a direct interest in any subsidiary of the Property or any interest therein as and Guarantor to the extent required by this Agreement such subsidiary owns a direct or the Mortgageindirect interest in Borrower; or (E) (1) if any petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law, shall be filed by Borrower or Guarantor, or (2) a direct or indirect interest in Borrower if foreclosed upon would result in the Minimum Ownership/Control Test not being met; and/or
(iv) if any representation, warranty or covenant contained in Article 5 hereof is violated or breached and such violation or breach results in the substantive consolidation of the assets and liabilities of Borrower or Guarantor files an answer consenting to, or otherwise joining in, any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law filed against it by Mortgage Borrower with the assets and liabilities of any other Person, or is found pursuant to a final, unappealable order of a court of competent jurisdiction to have solicited or caused to be solicited creditors to file any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law against Borrower or Guarantor, or (3) if Borrower or Guarantor are found, pursuant to a final unappealable order of a court of competent jurisdiction, to have been in collusion with creditors that initiate a bankruptcy action or proceeding against Borrower or Guarantor or (F) an Event of Default described in Section 8.1(s) hereof shall have occurred.
Appears in 1 contract
Samples: Mezzanine Loan Agreement (Brookfield DTLA Fund Office Trust Investor Inc.)
Exculpation. Subject to the qualifications below, Lender shall not enforce the liability and obligation of Borrower or its constituent members, partners, shareholders, directors, employees or agents or the direct or indirect constituent members, partners, shareholders, directors, employees or agents thereof (collectively, the “Borrower Parties”) or any other Person, Operating Lessee to perform and observe the obligations contained in the Note, this Agreement, the Note Security Instrument or any of the other Loan Documents by any action or proceeding wherein a money judgment or any deficiency judgment or other judgment establishing personal liability shall be sought against Borrower, Operating Lessee or any principal, director, officer, employee, beneficiary, shareholder, partner, member, trustee, agent, or affiliate of Borrower or Operating Lessee (but specifically excluding Guarantor) or any legal representatives, successors or assigns of any of the Borrower Parties or any other Personforegoing (collectively, the “Exculpated Parties”), except that Lender may bring a foreclosure action, an action for specific performance or any other appropriate action or proceeding to enable Lender to enforce and realize upon its interest under the Note, this Agreement, the Security Instrument and the other Loan Documents, or in the Property, the Rents Rents, or any other collateral given to Lender pursuant to this Agreement and the other Loan Documents; provided, however, that, except as specifically provided herein, any judgment in any such action or proceeding shall be enforceable against the Borrower Parties and/or Operating Lessee only to the extent of their Borrower’s or Operating Lessee’s, as applicable, interest in the Property, in the Rents and in any other collateral given to Lender, and Lender, by accepting the Note, this Agreement, the Note Security Instrument and the other Loan Documents, agrees that it shall not sxx xxx for, seek or demand any deficiency judgment against Borrower or Operating Lessee or any of the Borrower Parties or any other Person Exculpated Parties, in any such action or proceeding under or by reason of or under or in connection with the Note, this Agreement, the Note Security Instrument or any of the other Loan Documents. The provisions of this paragraph Section shall not, however, (ia) constitute a waiver, release or impairment of any obligation evidenced or secured by this Agreement, the Note or any of the other Loan Documents; (iib) impair the right of Lender to name any of the Borrower Parties, and/or Operating Lessee as a party defendant in any action or suit for foreclosure and sale under the MortgageSecurity Instrument; (iiic) affect the validity or enforceability of any guaranty indemnity, guaranty, or similar instrument made in connection with the Loan or any of the rights and remedies of Lender thereunder; (ivd) impair the right of Lender to obtain the appointment of a receiver; (ve) impair the enforcement of the Assignment assignment of Leases leases and Rentsrents contained in the Security Instrument; (f) impair the right of Lender to enforce the provisions of the Environmental Indemnity or of Section 4.1.6(i) hereof; (g) constitute a prohibition against Lender to seek a deficiency judgment against Borrower in order to fully realize on any security given by Borrower in connection with the Loan or to commence any other appropriate action or proceeding in order for Lender to exercise its remedies against such security; or (vih) constitute a waiver of the right of Lender to enforce the liability and obligation of Borrower (but not against any members of Borrower (other than Guarantor to the extent provided in the Non-Recourse Guaranty) or their direct or indirect constituent members or partners or any other Person)and/or Operating Lessee, by money judgment or otherwise, to the extent of any loss, damage, cost, expense, liability, claim or other obligation (but excluding any punitive, consequential or speculative damages) Losses incurred by Lender (including attorneys’ fees and costs reasonably incurred) arising out of or in connection with any of the following:
(ai) fraud or intentional willful misrepresentation by Borrower, Operating Lessee, any of the Exculpated Parties or any Borrower or Guarantor Party in connection with the Loan;
(bii) intentional physical waste the gross negligence or willful misconduct of Borrower, Operating Lessee, any of the Property (including, but not limited to, waste due to gross negligence) by Borrower Exculpated Parties or any affiliate thereof; provided, however, such physical waste shall exclude wear and tear to Borrower Party in connection with the Property that occurs in the ordinary course of business of the Property by Borrower or any affiliate thereofLoan;
(ciii) the material breach of any representation, warranty, covenant or indemnification provision in the Environmental Indemnity or in this Agreement any other Loan Document concerning Environmental Lawsenvironmental laws, Hazardous Substances hazardous substances and Asbestosasbestos and any indemnification of Lender with respect thereto in any such document;
(div) waste to the Property (or any portion thereof) caused by intentional acts or intentional omissions of Borrower, Operating Lessee, any Exculpated Party, or any Borrower Party, or the removal or disposal by Borrower or any affiliate thereof of any portion of the Property after an Event of Default has occurred and while it is continuing, unless such portion of the Property is replaced by an item of equal or greater value as determined by Lender in its reasonable discretionDefault;
(ev) the misapplication misapplication, misappropriation or conversion by Borrower, Operating Lessee, any of the Exculpated Parties or the Borrower or any affiliate thereof Parties of (iA) any insurance proceeds paid by reason of any loss, damage or destruction to the Property, (iiB) any awards Awards or other amounts received in connection with the condemnation Condemnation of all or a portion of the Property, or (iiiC) any Rents following an Event of Default or (ivD) any Tenant security deposits or Rents paid more than one (1) month collected in advance;
(fvi) any Personal Property taken from the Property by or on behalf of Borrower, Operating Lessee, any of the Exculpated Parties or the Borrower Parties, and not replaced with Personal Property of the same utility and of the same or greater value;
(vii) any act of arson by Borrower, Operating Lessee, any of the Exculpated Parties, or any Borrower Parties;
(viii) any fees or commissions paid by Borrower or Operating Lessee, or on behalf of Borrower or Operating Lessee, as applicable, after the occurrence of an Event of Default to any Exculpated Party or any Borrower Party in violation of the terms of the Note, this Agreement, the Security Instrument or the other Loan Documents;
(ix) failure to pay Taxes, charges for labor or materials or taxes materials, or other charges that can create liens superior to the lien of the Mortgage Liens on any portion of the Property unless such taxes or other charges are being contested in accordance herewith or such taxes or charges have been delivered and/or the failure to Lender pay Insurance Premiums in accordance with Section 3.3 hereof or Borrower has complied with Section 5.2 the terms hereof; and;
(gx) any security deposits, advance deposits or any other deposits collected by Borrower or any affiliate thereof with respect to the any Individual Property which are not delivered to Lender upon a foreclosure of the such Individual Property or action in lieu thereof, except to the extent any such security deposits were applied in accordance with the terms and conditions of any of the Leases prior to the occurrence of the Event of Default that gave rise to such foreclosure or action in lieu thereof. Notwithstanding anything ;
(xi) any failure by Borrower and/or Operating Lessee to the contrary in permit on-site inspections of any of the Loan Documents (i) Lender shall not be deemed to have waived any right which Lender may have under Section 506(a), 506(b), 1111(b) or any other provisions of the U.S. Bankruptcy Code to file a claim for the full amount of the Debt or to require that all collateral shall continue to secure all of the Debt owing to Lender in accordance with the Loan Documents, and (ii) the Debt shall become fully recourse to Borrower (but not its members (other than Guarantor solely to the extent provided in the Non-Recourse Guaranty) or other direct or indirect constituent members or partners or any other Person) in the event that: (A) the first full Monthly Debt Service Payment Amount (Individual Property as defined in the Note) under the Note is not paid when due; (B) other than in connection with a default under subsection (x) of the definition of Special Purpose Bankruptcy Remote Entity set forth in Schedule 5 hereto, Borrower fails to maintain its status as a Special Purpose Bankruptcy Remote Entity in accordance with the provisions of this Agreement and such failure results in the substantive consolidation of Borrower with another Person; (C) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any subordinate financing or other voluntary lien encumbering the Property; (D) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any assignment, transfer, or conveyance of the Property or any interest therein as and to the extent required by this Agreement or and/or the Mortgage; or other Loan Documents;
(Exii) any failure of Operating Lessee to appoint a new property manager upon the request of Lender as required by the terms of this Agreement and/or the other Loan Documents;
(1xiii) if any petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy lawBorrower’s and/or Operating Lessee’s breach of, or any similar federal or state lawfailure to comply with, shall be filed by Borrower or Guarantorthe representations, or (2) if Borrower or Guarantor files an answer consenting towarranties and covenants contained in the Franchise Provisions, or otherwise joining in, any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law filed against it by any other Person, or is found pursuant to a final, unappealable order of a court of competent jurisdiction to have solicited or caused to be solicited creditors to file any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law against Borrower or Guarantor, or (3) if Borrower or Guarantor are found, pursuant to a final unappealable order of a court of competent jurisdiction, to have been in collusion with creditors that initiate a bankruptcy action or proceeding against Borrower or Guarantor or (F) an Event of Default described in Section 8.1(s) hereof shall have occurred4.1.
Appears in 1 contract
Exculpation. Subject Notwithstanding anything to the qualifications belowcontrary contained herein, Lender it is agreed (a) that if Landlord or any successor in interest is a corporation, there shall not enforce be no personal liability on the part of any stockholder, officer or director of such corporation or any subsidiary, affiliate, joint venturer, or partner of such corporation herewith, and (b) that if Landlord is a firm, partnership, joint venture or association, there shall be no personal liability on the part of any partner, general or limited, or member thereof with respect to any obligations hereunder or in connection herewith. If Landlord shall be in breach or default with respect to its obligations under this Lease, Tenant agrees (a) that it shall look solely to the estate, equity and obligation interest of Borrower Landlord in the land and building of which the demised premises form a part for the collection of any judgement (or other judicial process} requiring the payment of money by Landlord in the event of any default or breach by Landlord hereunder and (b) that there shall be no personal liability on the part of Landlord or its constituent membersstockholders, partners, shareholdersofficers, directors, employees subsidiaries, affiliates, joint venturers, partners or agents or members for the direct or indirect constituent members, partners, shareholders, directors, employees or agents thereof (collectively, the “Borrower Parties”) or any other Person, to perform and observe the obligations contained in this Agreement, the Note or any collection of the other Loan Documents by any action or proceeding wherein a money judgment shall be sought against any of the Borrower Parties or any other Person, except that Lender may bring a foreclosure action, an action for specific performance or any other appropriate action or proceeding to enable Lender to enforce and realize upon the Property, the Rents or any other collateral given to Lender pursuant to this Agreement and the other Loan Documents; provided, however, that, except as specifically provided herein, any judgment in any such action judgement or proceeding shall be enforceable against the Borrower Parties only to the extent of other judicial process beyond their interest respective interests in the Property, land and building of which the Rents and in any other collateral given to Lender, and Lender, by accepting this Agreement, the Note and the other Loan Documents, agrees that it shall not sxx for, seek or demand any deficiency judgment against any of the Borrower Parties or any other Person in any such action or proceeding under or by reason of or in connection with this Agreement, the Note or any of the other Loan Documentsdemised premises form a part. The provisions of this paragraph hereof shall not, however, (i) constitute a waiver, release or impairment of any obligation evidenced or secured by this Agreement, the Note or any of the other Loan Documents; (ii) impair the right of Lender to name any of the Borrower Parties, as a party defendant in any action or suit for foreclosure and sale under the Mortgage; (iii) affect the validity or enforceability of any guaranty made in connection with the Loan or any rights and remedies of Lender thereunder; (iv) impair the right of Lender to obtain the appointment of a receiver; (v) impair the enforcement of the Assignment of Leases and Rents; or (vi) constitute be deemed a waiver or modification of Tenant's rights or Landlord's obligations under this Lease, nor shall it prevent Tenant from obtaininq judgement against the right Landlord in case of Lender to enforce the liability and obligation of Borrower (but not against any members of Borrower (other than Guarantor such breach or default to the extent provided that the same shall be a lien against Landlord's equity or interest in said land and building or from levying against Landlord's equity or interest therein, nor from asserting any set off or deduction against the Non-Recourse Guaranty) rents payable under this Lease to which Tenant may be entitled under this Lease, or their direct or indirect constituent members or partners or any other Person), by money judgment or otherwise, to the extent of any loss, damage, cost, expense, liability, claim or other obligation (but excluding any punitive, consequential or speculative damages) incurred by Lender (including attorneys’ fees and costs reasonably incurred) arising out of or in connection with the following:
(a) fraud or intentional misrepresentation by Borrower or Guarantor in connection with the Loan;
(b) intentional physical waste of the Property (including, but not limited to, waste due to gross negligence) by Borrower or any affiliate thereof; provided, however, such physical waste shall exclude wear and tear to the Property that occurs in the ordinary course of business of the Property by Borrower or any affiliate thereof;
(c) the material breach of any representation, warranty, covenant or indemnification provision in the Environmental Indemnity or in this Agreement concerning Environmental Laws, Hazardous Substances and Asbestos;
(d) the removal or disposal by Borrower or any affiliate thereof of any portion of the Property after an Event of Default has occurred and while it is continuing, unless such portion of the Property is replaced by an item of equal or greater value as determined by Lender judgement in its reasonable discretion;
(e) the misapplication or conversion by Borrower or any affiliate thereof of (i) any insurance proceeds paid by reason of any loss, damage or destruction to the Property, (ii) any awards or other amounts received in connection with the condemnation of all or a portion of the Property, (iii) any Rents following an Event of Default or (iv) any Rents paid more than one (1) month in advance;
(f) failure to pay charges for labor or materials or taxes or other charges that can create liens superior to the lien of the Mortgage on any portion of the Property unless such taxes or other charges are being contested in accordance herewith or such taxes or charges have been delivered to Lender in accordance with Section 3.3 hereof or Borrower has complied with Section 5.2 hereof; and
(g) any security deposits collected by Borrower or any affiliate thereof with respect to the Property which are not delivered to Lender upon a foreclosure of the Property or action in lieu thereof, except to the extent any such security deposits were applied in accordance with the terms and conditions of any of the Leases prior to the occurrence of the Event of Default that gave rise to such foreclosure or action in lieu thereof. Notwithstanding anything to the contrary in any of the Loan Documents (i) Lender shall not be deemed to have waived any right which Lender may have under Section 506(a), 506(b), 1111(b) or any other provisions of the U.S. Bankruptcy Code to file a claim for the full amount of the Debt or to require that all collateral shall continue to secure all of the Debt owing to Lender in accordance with the Loan Documents, and (ii) the Debt shall become fully recourse to Borrower (but not its members (other than Guarantor solely to the extent provided in the Non-Recourse Guaranty) or other direct or indirect constituent members or partners or any other Person) in the event that: (A) the first full Monthly Debt Service Payment Amount (as defined in the Note) under the Note is not paid when due; (B) other than in connection with a default under subsection (x) of the definition of Special Purpose Bankruptcy Remote Entity set forth in Schedule 5 hereto, Borrower fails to maintain its status as a Special Purpose Bankruptcy Remote Entity in accordance with the provisions of this Agreement and such failure results in the substantive consolidation of Borrower with another Person; (C) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any subordinate financing or other voluntary lien encumbering the Property; (D) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any assignment, transfer, or conveyance of the Property or any interest therein as and to the extent required by this Agreement or the Mortgage; or (E) (1) if any petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law, shall be filed by Borrower or Guarantor, or (2) if Borrower or Guarantor files an answer consenting to, or otherwise joining in, any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law filed against it by any other Person, or is found pursuant to a final, unappealable order of a court of competent jurisdiction to have solicited or caused to be solicited creditors to file any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law against Borrower or Guarantor, or (3) if Borrower or Guarantor are found, pursuant to a final unappealable order of a court of competent jurisdiction, to have been in collusion with creditors that initiate a bankruptcy action or proceeding against Borrower or Guarantor or (F) an Event of Default described in Section 8.1(s) hereof shall have occurredfavor.
Appears in 1 contract
Samples: Lease Agreement (Lbu Inc)
Exculpation. Subject to the qualifications below, Lender shall not enforce the liability and obligation of Borrower or its constituent members, partners, shareholders, directors, employees or agents or the direct or indirect constituent members, partners, shareholders, directors, employees or agents thereof (collectively, the “Borrower Parties”"BORROWER PARTIES") or any other Person, to perform and observe the obligations contained in this Agreement, the Note or any of the other Loan Documents by any action or proceeding wherein a money judgment shall be sought against any of the Borrower Parties or any other Person, except that Lender may bring a foreclosure action, an action for specific performance or any other appropriate action or proceeding to enable Lender to enforce and realize upon the Property, the Rents or any other collateral given to Lender pursuant to this Agreement and the other Loan Documents; provided, however, that, except as specifically provided herein, any judgment in any such action or proceeding shall be enforceable against the Borrower Parties only to the extent of their interest in the Property, the Rents and in any other collateral given to Lender, and Lender, by accepting this Agreement, the Note and the other Loan Documents, agrees that it shall not sxx sue for, seek or demand any deficiency judgment against any of the Borrower Bxxxower Parties or any other Person in any such action or proceeding under or by reason of or in connection with this Agreement, the Note or any of the other Loan Documents. The provisions of this paragraph shall not, however, (i) constitute a waiver, release or impairment of any obligation evidenced or secured by this Agreement, the Note or any of the other Loan Documents; (ii) impair the right of Lender to name any of the Borrower Parties, as a party defendant in any action or suit for foreclosure and sale under the Mortgage; (iii) affect the validity or enforceability of any guaranty made in connection with the Loan or any rights and remedies of Lender thereunder; (iv) impair the right of Lender to obtain the appointment of a receiver; (v) impair the enforcement of the Assignment of Leases and RentsRents executed in connection herewith; or (vi) constitute a waiver of the right of Lender to enforce the liability and obligation of Borrower (but not against any members of Borrower (other than Guarantor to the extent provided in the Non-Recourse Guaranty) or their direct or indirect constituent members or partners or any other Person), by money judgment or otherwise, to the extent of any loss, damage, cost, expense, liability, claim or other obligation (but excluding any punitive, consequential or speculative damages) incurred by Lender (including attorneys’ ' fees and costs reasonably incurred) arising out of or in connection with the following:
(a) fraud or intentional misrepresentation by Borrower or any Guarantor in connection with the Loan;
(b) intentional physical waste of the Property (including, but not limited to, waste due to gross negligence) by Borrower or any affiliate thereof; provided, however, such physical waste shall exclude wear and tear to the Property that occurs in the ordinary course of business of the Property by Borrower or any affiliate thereof;
(c) the material breach of any representation, warranty, covenant or indemnification provision in the that certain Environmental Indemnity and Hazardous Substance Indemnification Agreement of even date herewith given by Borrower to Lender or in this Agreement concerning Environmental Laws, Hazardous Substances and Asbestos;
(d) the removal or disposal by Borrower or any affiliate thereof of any portion of the Property after an Event of Default has occurred and while it is continuingDefault, unless such portion of the Property is replaced by an item of equal or greater value as determined by Lender in its reasonable discretion;
(e) the misapplication or conversion by Borrower or any affiliate thereof of (i) any insurance proceeds paid by reason of any loss, damage or destruction to the Property, (ii) any awards or other amounts received in connection with the condemnation of all or a portion of the Property, (iii) any Rents following an Event of Default or (iv) any Rents paid more than one (1) month in advance;
(f) failure to pay charges for labor or materials or taxes or other charges that can create liens superior to the lien of the Mortgage on any portion of the Property unless such taxes or other charges are being contested in accordance herewith or such taxes or charges have been delivered to Lender in accordance with Section 3.3 hereof or Borrower has complied with Section 5.2 hereofherewith; and
(g) any security deposits collected by Borrower or any affiliate thereof with respect to the Property which are not delivered to Lender upon a foreclosure of the Property or action in lieu thereof, except to the extent any such security deposits were applied in accordance with the terms and conditions of any of the Leases prior to the occurrence of the Event of Default that gave rise to such foreclosure or action in lieu thereof. Notwithstanding anything to the contrary in any of the Loan Documents .
(i1) Lender shall not be deemed to have waived any right which Lender may have under Section 506(a), 506(b), 1111(b) or any other provisions of the U.S. Bankruptcy Code to file a claim for the full amount of the Debt or to require that all collateral shall continue to secure all of the Debt owing to Lender in accordance with the Loan Documents, and (ii) the Debt shall become fully recourse to Borrower (but not its members receiver (other than a receiver appointed by Lender), liquidator or trustee of Borrower or Guarantor solely to the extent provided in the Non-Recourse Guaranty) or other direct or indirect constituent members or partners or any other Person) in the event that: (A) the first full Monthly Debt Service Payment Amount (as defined in the Note) under the Note shall be appointed which is not paid when due; dismissed within ninety (B90) other than in connection with a default under subsection (x) of the definition of Special Purpose Bankruptcy Remote Entity set forth in Schedule 5 hereto, Borrower fails to maintain its status as a Special Purpose Bankruptcy Remote Entity in accordance with the provisions of this Agreement and such failure results in the substantive consolidation of Borrower with another Person; (C) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any subordinate financing or other voluntary lien encumbering the Property; (D) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any assignment, transferdays, or conveyance of the Property or any interest therein as and to the extent required by this Agreement or the Mortgage; or (E) (12) if any petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law, shall be filed by Borrower or Guarantor, or (23) if Borrower or Guarantor files an answer consenting to, or otherwise joining in, any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law filed against it by any other Person, or is found pursuant to a final, unappealable order of a court of competent jurisdiction to have solicited or caused to be solicited creditors to file any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law against Borrower or Guarantor, or (34) if Borrower or Guarantor are found, pursuant to a final unappealable order of a court of competent jurisdiction, to have been in collusion with creditors that initiate a bankruptcy action or proceeding against Borrower or Guarantor or (F) an Event of Default described in Section 8.1(s) hereof shall have occurredGuarantor.
Appears in 1 contract
Exculpation. Subject to the qualifications below(a) Except as otherwise expressly provided in this Section 9.4, Lender shall not enforce the liability and obligation of Borrower or its constituent members, partners, shareholders, directors, employees or agents or the direct or indirect constituent members, partners, shareholders, directors, employees or agents thereof (collectively, the “Borrower Parties”) or any other Person, to perform and observe the obligations contained in this Agreement, the Note or the Pledge Agreement or any of the other Loan Documents Document by any action or proceeding wherein a money judgment shall be sought against any of the Borrower Parties or any other PersonExculpated Party, except that Lender may bring a foreclosure action, an action for specific performance or any other appropriate action or proceeding to enable Lender to enforce and realize upon the Propertythis Agreement, the Rents or Note, the Pledge Agreement, the other Loan Documents, and the Collateral and any other collateral given for the Debt in which a security interest is granted to Lender pursuant to by this Agreement, the Pledge Agreement and or the other Loan Documents; provided, however, that, except as specifically provided herein, that any judgment in any such action or proceeding shall be enforceable against the Borrower Parties only to the extent of their Borrower’s interest in the PropertyCollateral, the Rents and in any other collateral given in which a security interest is granted to LenderLender by this Agreement, and the Pledge Agreement or the other Loan Documents. Lender, by accepting this Agreement, the Note and the other Loan DocumentsPledge Agreement, agrees that it shall not sxx not, except as otherwise expressly provided in this Section 9.4, xxx for, seek or demand any deficiency or other money judgment against Borrower, any direct or indirect member, manager, shareholder, partner, beneficiary or other owner of beneficial ownership interests in Borrower, or any affiliate, director, officer, employee, trustee or agent of any of the Borrower Parties or any other Person foregoing (each, an “Exculpated Party” and, collectively, the “Exculpated Parties”) in any such action or proceeding proceeding, under or by reason of or under or in connection with this Agreement, the Note Note, the Pledge Agreement or any of the other Loan Documents. The provisions of this paragraph Section shall not, however, (i) constitute a waiver, release or impairment of any obligation evidenced or secured by this Agreement, the Note Note, the Pledge Agreement or any of the other Loan Documents; (ii) impair the right of Lender to name any of the Borrower Parties, as a party defendant in any action or suit for judicial foreclosure and sale under the MortgagePledge Agreement (subject, however, to the aforesaid limitation on Lender’s right to xxx, seek or demand a deficiency or other money judgment against Borrower or any other Exculpated Party); (iii) affect the validity or enforceability of any guaranty indemnity (including, without limitation, the Environmental Indemnity), guaranty, master lease or similar instrument made in connection with this Agreement, the Note, the Pledge Agreement, or the other Loan Documents (subject, however, to any exculpatory or any rights and remedies of Lender thereundernon-recourse provisions appearing in such indemnity, guaranty or similar instrument); (iv) impair the right of Lender to obtain the appointment of a receiver; (v) impair the enforcement of the Assignment of Leases and Rents[intentionally omitted]; or (vi) constitute a waiver of impair the right of Lender to enforce the liability provisions of Sections 4.1.8, 4.1.28, 5.1.9 and obligation 5.2.8 hereof (subject, however, to the aforesaid limitation on Lender’s right to xxx, seek or demand a deficiency or other money judgment against Borrower or any other Exculpated Party which such limitation, with respect to Borrower, shall not apply to the Environmental Indemnity); or (vii) impair the right of Lender to obtain a deficiency judgment or other judgment on the Note against Borrower (but not against any members of Borrower (other than Guarantor if and to the extent necessary to obtain any insurance proceeds or condemnation awards to which Lender would otherwise be entitled under this Agreement; provided in the Non-Recourse Guaranty) or their direct or indirect constituent members or partners or any other Person)however, by money that Lender shall only be entitled to enforce such judgment or otherwise, to the extent of any lossthe insurance proceeds and/or condemnation awards.
(b) Notwithstanding the provisions of this Section 9.4 to the contrary, damage, cost, expense, liability, claim or other obligation Borrower and Guarantor pursuant to the Guaranty (but excluding not any punitiveother Exculpated Parties) shall be personally liable to Lender for any actual Losses Lender incurs due to the following (collectively, consequential the “Recourse Events”):
(i) any fraud committed by Borrower, Mortgage Borrower or speculative damages) incurred by Lender (including attorneys’ fees and costs reasonably incurred) arising out any of their Affiliates or agents in connection with the following:Loan or Mortgage Loan;
(aii) fraud or any intentional and material misrepresentation by Borrower or Guarantor Mortgage Borrower in connection with any of the LoanLoan Documents or the Mortgage Loan Documents;
(biii) the misappropriation by Borrower, Mortgage Borrower or any of their Affiliates or agents of any funds (including misappropriation of Rents, security deposits and/or Net Proceeds);
(iv) any Transfer, Sale or Pledge of the Property, the Collateral or any interest of a Restricted Party therein, and in each case, which is prohibited hereunder;
(v) the intentional and material breach of any representation in the Environmental Indemnity or in Sections 4.1.39 or 5.1.19 hereof;
(vi) any voluntary filing by Borrower, Mortgage Borrower, Mortgage Principal or Principal under the Bankruptcy Code or any other federal or state bankruptcy or insolvency law;
(vii) any involuntary filing against Borrower, Mortgage Borrower, Mortgage Principal or Principal under the Bankruptcy Code or any other federal or state bankruptcy or insolvency law by any Person acting at the request or under the direction of Borrower, Mortgage Borrower or any of their Affiliates or agents;
(viii) Mortgage Borrower, Mortgage Principal, Borrower or Principal consents to or acquiesces in or joins in an application for the appointment of a custodian, receiver, trustee or examiner for Mortgage Borrower, Mortgage Principal, Borrower or Principal or any portion of the Property or the Collateral;
(ix) Borrower’s making a distribution to its equity owners after the occurrence and during the continuance of an Event of Default;
(x) Mortgage Borrower, Mortgage Principal, Borrower or Principal makes an assignment for the benefit of creditors; or
(xi) any intentional physical waste of the Property (includingby Mortgage Borrower, but not limited toMortgage Principal, waste due to gross negligence) by Borrower or any affiliate thereof; provided, however, such physical waste shall exclude wear and tear to the Property that occurs in the ordinary course of business of the Property by Borrower Principal or any affiliate thereof;
(c) the material breach of any representation, warranty, covenant their Affiliates or indemnification provision in the Environmental Indemnity or in this Agreement concerning Environmental Laws, Hazardous Substances and Asbestos;
(d) the removal or disposal by Borrower or any affiliate thereof of any portion of the Property after an Event of Default has occurred and while it is continuing, unless such portion of the Property is replaced by an item of equal or greater value as determined by Lender in its reasonable discretion;
(e) the misapplication or conversion by Borrower or any affiliate thereof of (i) any insurance proceeds paid by reason of any loss, damage or destruction to the Property, (ii) any awards or other amounts received in connection with the condemnation of all or a portion of the Property, (iii) any Rents following an Event of Default or (iv) any Rents paid more than one (1) month in advance;
(f) failure to pay charges for labor or materials or taxes or other charges that can create liens superior to the lien of the Mortgage on any portion of the Property unless such taxes or other charges are being contested in accordance herewith or such taxes or charges have been delivered to Lender in accordance with Section 3.3 hereof or Borrower has complied with Section 5.2 hereof; and
(g) any security deposits collected by Borrower or any affiliate thereof with respect to the Property which are not delivered to Lender upon a foreclosure of the Property or action in lieu thereof, except to the extent any such security deposits were applied in accordance with the terms and conditions of any of the Leases prior to the occurrence of the Event of Default that gave rise to such foreclosure or action in lieu thereof. Notwithstanding anything to the contrary in any of the Loan Documents (i) Lender shall not be deemed to have waived any right which Lender may have under Section 506(a), 506(b), 1111(b) or any other provisions of the U.S. Bankruptcy Code to file a claim for the full amount of the Debt or to require that all collateral shall continue to secure all of the Debt owing to Lender in accordance with the Loan Documents, and (ii) the Debt shall become fully recourse to Borrower (but not its members (other than Guarantor solely to the extent provided in the Non-Recourse Guaranty) or other direct or indirect constituent members or partners or any other Person) in the event that: (A) the first full Monthly Debt Service Payment Amount (as defined in the Note) under the Note is not paid when due; (B) other than in connection with a default under subsection (x) of the definition of Special Purpose Bankruptcy Remote Entity set forth in Schedule 5 hereto, Borrower fails to maintain its status as a Special Purpose Bankruptcy Remote Entity in accordance with the provisions of this Agreement and such failure results in the substantive consolidation of Borrower with another Person; (C) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any subordinate financing or other voluntary lien encumbering the Property; (D) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any assignment, transfer, or conveyance of the Property or any interest therein as and to the extent required by this Agreement or the Mortgage; or (E) (1) if any petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law, shall be filed by Borrower or Guarantor, or (2) if Borrower or Guarantor files an answer consenting to, or otherwise joining in, any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law filed against it by any other Person, or is found pursuant to a final, unappealable order of a court of competent jurisdiction to have solicited or caused to be solicited creditors to file any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law against Borrower or Guarantor, or (3) if Borrower or Guarantor are found, pursuant to a final unappealable order of a court of competent jurisdiction, to have been in collusion with creditors that initiate a bankruptcy action or proceeding against Borrower or Guarantor or (F) an Event of Default described in Section 8.1(s) hereof shall have occurredagents.
Appears in 1 contract
Samples: Mezzanine Loan Agreement (Archstone Smith Operating Trust)
Exculpation. Subject Except for claims directly attributable to the qualifications belowactive gross negligence of Lessor as evidenced by a final judgment by a court of competent jurisdiction after the expiration of all applicable appeal periods, Lender shall not enforce Lessee, as a material part of the liability consideration to Lessor, hereby assumes all risk of damage to the Premises, injury and obligation death to persons and all claims of Borrower any other nature resulting from Lessee’s use of all or any part of the Premises, and, notwithstanding the negligence or breach of this Lease by Lessor or its constituent membersagents, partnersLessee hereby waives all claims in respect thereof against Lessor, shareholdersLessor’s property manager, directors, employees any other occupant or agents or tenant of the direct or indirect constituent members, partners, shareholders, directors, employees or agents thereof (collectively, the “Borrower Parties”) Project or any other Person, to perform and observe the obligations contained in this Agreement, the Note or any of the other Loan Documents by any action or proceeding wherein a money judgment shall be sought against any of the Borrower Parties or any other Person, except that Lender may bring a foreclosure action, an action for specific performance or any other appropriate action or proceeding to enable Lender to enforce and realize upon the Property, the Rents or any other collateral given to Lender pursuant to this Agreement and the other Loan Documents; provided, however, that, except as specifically provided herein, any judgment in any such action or proceeding shall be enforceable against the Borrower Parties only to the extent of their interest in the Property, the Rents and in any other collateral given to Lender, and Lender, by accepting this Agreement, the Note and the other Loan Documents, agrees that it shall not sxx for, seek or demand any deficiency judgment against any of the Borrower Parties or any other Person in any such action or proceeding under or by reason of or in connection with this Agreement, the Note or any of the other Loan Documents. The provisions of this paragraph shall not, however, (i) constitute a waiver, release or impairment of any obligation evidenced or secured by this Agreement, the Note or any of the other Loan Documents; (ii) impair the right of Lender to name any of the Borrower Parties, as a party defendant in any action or suit for foreclosure and sale under the Mortgage; (iii) affect the validity or enforceability of any guaranty made in connection with the Loan or any rights and remedies of Lender thereunder; (iv) impair the right of Lender to obtain the appointment of a receiver; (v) impair the enforcement of the Assignment of Leases and Rents; or (vi) constitute a waiver of the right of Lender to enforce the liability and obligation of Borrower (but not against any members of Borrower (other than Guarantor to the extent provided in the Non-Recourse Guaranty) or their direct or indirect constituent members or partners or any other Person), by money judgment or otherwiseperson, to the extent of any loss, damage, cost, expense, liability, claim permitted by law. Neither Lessor nor its agents or other obligation (but excluding any punitive, consequential or speculative damages) incurred by Lender (including attorneys’ fees and costs reasonably incurred) arising out employees shall be liable for loss of or damage to any property of Lessee by theft or otherwise. Neither Lessor nor its employees or agents shall be liable for any defects in connection with the following:
(a) fraud Premises, nor shall Lessor be liable for the negligence or intentional misrepresentation by Borrower or Guarantor in connection with the Loan;
(b) intentional physical waste of the Property (misconduct, including, but not limited to, waste due to gross negligence) criminal acts, by Borrower maintenance or other personnel or contractors serving the Premises or third parties. All property of Lessee kept or stored on the Premises shall be so kept or stored at the risk of Lessee only, and Lessee shall indemnify, defend and hold Lessor harmless for, from and against, and shall be responsible for, any affiliate thereof; provided, however, such physical waste shall exclude wear and tear claims arising out of damage to the Property that occurs in the ordinary course of business same, including subrogation claims by Lessee’s insurance carriers. None of the Property by Borrower events or any affiliate thereof;
(c) the material breach of any representation, warranty, covenant or indemnification provision in the Environmental Indemnity or in this Agreement concerning Environmental Laws, Hazardous Substances and Asbestos;
(d) the removal or disposal by Borrower or any affiliate thereof of any portion of the Property after an Event of Default has occurred and while it is continuing, unless such portion of the Property is replaced by an item of equal or greater value as determined by Lender in its reasonable discretion;
(e) the misapplication or conversion by Borrower or any affiliate thereof of (i) any insurance proceeds paid by reason of any loss, damage or destruction to the Property, (ii) any awards or other amounts received in connection with the condemnation of all or a portion of the Property, (iii) any Rents following an Event of Default or (iv) any Rents paid more than one (1) month in advance;
(f) failure to pay charges for labor or materials or taxes or other charges that can create liens superior to the lien of the Mortgage on any portion of the Property unless such taxes or other charges are being contested in accordance herewith or such taxes or charges have been delivered to Lender in accordance with Section 3.3 hereof or Borrower has complied with Section 5.2 hereof; and
(g) any security deposits collected by Borrower or any affiliate thereof with respect to the Property which are not delivered to Lender upon a foreclosure of the Property or action in lieu thereof, except to the extent any such security deposits were applied in accordance with the terms and conditions of any of the Leases prior to the occurrence of the Event of Default that gave rise to such foreclosure or action in lieu thereof. Notwithstanding anything to the contrary in any of the Loan Documents (i) Lender shall not be deemed to have waived any right which Lender may have under Section 506(a), 506(b), 1111(b) or any other provisions of the U.S. Bankruptcy Code to file a claim for the full amount of the Debt or to require that all collateral shall continue to secure all of the Debt owing to Lender in accordance with the Loan Documents, and (ii) the Debt shall become fully recourse to Borrower (but not its members (other than Guarantor solely to the extent provided in the Non-Recourse Guaranty) or other direct or indirect constituent members or partners or any other Person) in the event that: (A) the first full Monthly Debt Service Payment Amount (as defined in the Note) under the Note is not paid when due; (B) other than in connection with a default under subsection (x) of the definition of Special Purpose Bankruptcy Remote Entity set forth in Schedule 5 heretothis Paragraph or in Paragraph 8.8 of the Form Lease shall be deemed a constructive or actual eviction or result in a termination of the Lease Agreement, Borrower fails to maintain its status as a Special Purpose Bankruptcy Remote Entity in accordance with the provisions of this Agreement and such failure results in the substantive consolidation of Borrower with another Person; (C) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent nor shall Lessee be entitled to any subordinate financing abatement or other voluntary lien encumbering the Property; (D) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any assignment, transfer, or conveyance reduction of the Property or any interest therein as and to the extent required Rent by this Agreement or the Mortgage; or (E) (1) if any petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law, shall be filed by Borrower or Guarantor, or (2) if Borrower or Guarantor files an answer consenting to, or otherwise joining in, any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law filed against it by any other Person, or is found pursuant to a final, unappealable order of a court of competent jurisdiction to have solicited or caused to be solicited creditors to file any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law against Borrower or Guarantor, or (3) if Borrower or Guarantor are found, pursuant to a final unappealable order of a court of competent jurisdiction, to have been in collusion with creditors that initiate a bankruptcy action or proceeding against Borrower or Guarantor or (F) an Event of Default described in Section 8.1(s) hereof shall have occurredreason thereof.
Appears in 1 contract
Samples: Standard Industrial/Commercial Single Tenant Lease Net (Supreme Industries Inc)
Exculpation. Subject to the qualifications below, Lender shall not enforce the liability and obligation of Borrower or its constituent members, partners, shareholders, directors, employees or agents or the direct or indirect constituent members, partners, shareholders, directors, employees or agents thereof (collectively, the “Borrower Parties”) or any other Person, to perform and observe the obligations contained in this Agreement, the Note or any of the other Loan Documents by any action or proceeding wherein a money judgment shall be sought against any of the Borrower Parties or any other Person, except that Lender may bring a foreclosure action, an action for specific performance or any other appropriate action or proceeding to enable Lender to enforce and realize upon the Property, the Rents or any other collateral given to Lender pursuant to this Agreement and the other Loan Documents; provided, however, that, except as specifically provided herein, any judgment in any such action or proceeding shall be enforceable against the Borrower Parties only to the extent of their interest in the Property, the Rents and in any other collateral given to Lender, and Lender, by accepting this Agreement, the Note and the other Loan Documents, agrees that it shall not sxx xxx for, seek or demand any deficiency judgment against any of the Borrower Parties or any other Person in any such action or proceeding under or by reason of or in connection with this Agreement, the Note or any of the other Loan Documents. The provisions of this paragraph shall not, however, (i) constitute a waiver, release or impairment of any obligation evidenced or secured by this Agreement, the Note or any of the other Loan Documents; (ii) impair the right of Lender to name any of the Borrower Parties, as a party defendant in any action or suit for foreclosure and sale under the Mortgage; (iii) affect the validity or enforceability of any guaranty made in connection with the Loan or any rights and remedies of Lender thereunder; (iv) impair the right of Lender to obtain the appointment of a receiver; (v) impair the enforcement of the Assignment of Leases and RentsRents executed in connection herewith; or (vi) constitute a waiver of the right of Lender to enforce the liability and obligation of Borrower (but not against any members of Borrower (other than Guarantor to the extent provided in the Non-Recourse Guaranty) or their direct or indirect constituent members or partners or any other Person), by money judgment or otherwise, to the extent of any loss, damage, cost, expense, liability, claim or other obligation (but excluding any punitive, consequential or speculative damages) incurred by Lender (including attorneys’ fees and costs reasonably incurred) arising out of or in connection with the following:
(a) fraud or intentional misrepresentation by Borrower or any Guarantor in connection with the Loan;
(b) intentional physical waste of the Property (including, but not limited to, waste due to gross negligence) by Borrower or any affiliate thereof; provided, however, such physical waste shall exclude wear and tear to the Property that occurs in the ordinary course of business of the Property by Borrower or any affiliate thereof;
(c) the material breach of any representation, warranty, covenant or indemnification provision in the that certain Environmental Indemnity and Hazardous Substance Indemnification Agreement of even date herewith given by Borrower to Lender or in this Agreement concerning Environmental Laws, Hazardous Substances and Asbestos;
(d) the removal or disposal by Borrower or any affiliate thereof of any portion of the Property after an Event of Default has occurred and while it is continuing, unless such portion of the Property is replaced by an item of equal or greater value as determined by Lender in its reasonable discretion;
(e) the misapplication or conversion by Borrower or any affiliate thereof of (i) any insurance proceeds paid by reason of any loss, damage or destruction to the Property, (ii) any awards or other amounts received in connection with the condemnation of all or a portion of the Property, (iii) any Rents following an Event of Default or (iv) any Rents paid more than one (1) month in advance;
(f) failure to pay charges for labor or materials or taxes or other charges that can create liens superior to the lien of the Mortgage on any portion of the Property unless such taxes or other charges are being contested in accordance herewith or such taxes or charges have been delivered to Lender in accordance with Section 3.3 hereof or Borrower has complied with Section 5.2 hereof5.2; and
(g) any security deposits collected by Borrower or any affiliate thereof with respect to the Property which are not delivered to Lender upon a foreclosure of the Property or action in lieu thereof, except to the extent any such security deposits were applied in accordance with the terms and conditions of any of the Leases prior to the occurrence of the Event of Default that gave rise to such foreclosure or action in lieu thereof. Notwithstanding anything to the contrary in any of the Loan Documents (i) Lender shall not be deemed to have waived any right which Lender may have under Section 506(a), 506(b), 1111(b) or any other provisions of the U.S. Bankruptcy Code to file a claim for the full amount of the Debt or to require that all collateral shall continue to secure all of the Debt owing to Lender in accordance with the Loan Documents, and (ii) the Debt shall become fully recourse to Borrower (but not its members (other than Guarantor solely to the extent provided in the Non-Recourse Guaranty) or other direct or indirect constituent members or partners or any other Person) in the event that: (A) the first full Monthly Debt Service Payment Amount (as defined in the Note) under the Note is not paid when due; (B) other than in connection with a default under subsection (x) of the definition of Special Purpose Bankruptcy Remote Entity set forth in Schedule 5 hereto, Borrower fails to maintain its status as a Special Purpose Bankruptcy Remote Entity in accordance with the provisions of this Agreement and such failure results in the substantive consolidation of Borrower with another Person; (C) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any subordinate financing or other voluntary lien encumbering the Property; (D) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any assignment, transfer, or conveyance of the Property or any interest therein as and to the extent required by this Agreement or the Mortgage; or (E) .
(1) if any petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law, shall be filed by Borrower or Guarantor, or (2) if Borrower or Guarantor files an answer consenting to, or otherwise joining in, any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law filed against it by any other Person, or is found pursuant to a final, unappealable order of a court of competent jurisdiction to have solicited or caused to be solicited creditors to file any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law against Borrower or Guarantor, or (3) if Borrower or Guarantor are found, pursuant to a final unappealable order of a court of competent jurisdiction, to have been in collusion with creditors that initiate a bankruptcy action or proceeding against Borrower or Guarantor or (F) an Event of Default described in Section 8.1(s) hereof shall have occurredGuarantor.
Appears in 1 contract
Exculpation. (a) Subject to the qualifications below, neither Agent nor Lender shall not enforce the liability liabilities and obligation obligations of Borrower or its constituent members, partners, shareholders, directors, employees or agents or the direct or indirect constituent members, partners, shareholders, directors, employees or agents thereof (collectively, the “Borrower Parties”) or any other Person, to perform and observe the obligations contained in the Note, this Agreement, the Note Building Loan Mortgage or any of the other Loan Documents by any action or proceeding wherein a money judgment shall be sought against any of the Borrower Parties or any other PersonBorrower, except that Lender Agent may bring a foreclosure action, an action for specific performance or any other appropriate action or proceeding to enable Agent and Lender to enforce and realize upon its interest under the Note, this Agreement, the Building Loan Mortgage and the other Loan Documents, or in the Property, the Rents Rents, or any other collateral given to Agent for the benefit of Lender pursuant to this Agreement and the other Loan Documents; provided, however, that, except as specifically provided herein, any judgment in any such action or proceeding shall be enforceable against the Borrower Parties only to the extent of their Borrower’s interest in the Property, in the Rents and in any other collateral given to Agent for the benefit of Lender, and LenderLender and Agent, by accepting the Note, this Agreement, the Note Building Loan Mortgage and the other Loan Documents, agrees that it shall not sxx xxx for, seek or demand any deficiency judgment against any of the Borrower Parties or any other Person in any such action or proceeding under under, or by reason of of, or in connection with with, the Note, this Agreement, the Note Building Loan Mortgage or any of the other Loan Documents. The provisions of this paragraph Section 3.1 shall not, however, (i) constitute a waiver, release or impairment of any obligation evidenced or secured by this Agreement, the Note or any of the other Loan Documents; (ii) impair the right of Agent USActive 36631986.12 -77- and Lender to name any of the Borrower Parties, as a party defendant in any action or suit for foreclosure and sale under the Building Loan Mortgage; (iii) affect the validity or enforceability of the Environmental Indemnity or any guaranty made in connection with the Loan or any of the rights and remedies of Agent and Lender thereunder; (iv) impair the right of Agent and Lender to obtain the appointment of a receiver; (v) impair the enforcement of the Assignment of Leases and RentsLeases; or (vi) constitute a waiver of prohibition against Agent and/or Lender seeking a deficiency judgment against Borrower in order to fully realize the security granted by the Building Loan Mortgage or commencing any other appropriate action or proceeding in order for Agent and/or Lender to exercise its remedies against the Property or any other Collateral.
(b) Nothing contained herein shall in any manner or way release, affect or impair the right of Agent and Lender to enforce the liability recover, and obligation of Borrower (but not against shall be fully and personally liable and subject to legal action, for any members of Borrower (actual losses, damages, costs, expenses, liabilities, claims, obligations, settlement payments, penalties, fines, assessments, citations, litigation, demands, defenses, judgments, suits, proceedings and other than Guarantor to the extent provided in the Non-Recourse Guaranty) or their direct or indirect constituent members or partners or any other Person), by money judgment or otherwise, to the extent expenses of any loss, damage, cost, expense, liability, claim kind whatsoever incurred or other obligation (but excluding any punitive, consequential or speculative damages) incurred suffered by Agent and/or Lender (including reasonable attorneys’ fees and costs reasonably incurredexpenses and court costs, and excluding consequential, punitive, indirect and exemplary damages, provided, however, that such consequential, punitive, indirect and exemplary damages shall not be excluded to the extent that such damages are sought by a third party from Agent and/or Lender) arising out of or in connection with the following:following (“Losses”):
(ai) fraud or intentional misrepresentation by any Borrower Party or Guarantor in connection with the Loan;
(b) intentional physical waste of the Property (including, but not limited to, waste due to gross negligence) by Borrower or any affiliate thereof; provided, however, such physical waste shall exclude wear and tear to the Property that occurs in the ordinary course of business of the Property by Borrower or any affiliate thereof;
(cii) the material breach of any representation, warranty, covenant or indemnification provision in the Environmental Indemnity or in this Agreement Loan Documents concerning Environmental Lawsenvironmental laws, Hazardous Substances hazardous substances and Asbestosasbestos and any indemnification of Agent and Lender with respect thereto;
(diii) intentional physical waste to the Property caused by the intentional acts or intentional omissions of a Borrower Party or the wrongful removal or disposal by Borrower or any affiliate thereof of any portion of the Property after an Event other than in the ordinary course of Default has occurred and while it is continuingbusiness, unless such portion of excluding physical waste resulting from intentional omissions resulting from (A) insufficient cash flow from the Property (and such insufficiency is replaced not due to misappropriation of Rents by an item of equal any Borrower Party) or greater value as determined by Lender in its reasonable discretion(B) Lender’s failure to make Excess Cash Flow available to Borrower during a Cash Trap Period;
(eiv) subject to Borrower’s right to contest the same as set forth in this Agreement, or the right of a Tenant to contest the same in accordance with its Lease, Borrower’s failure to pay Taxes, charges for labor or materials or other charges or judgments that can create Liens on any portion of a Property to the extent any such Lien is not bonded over or discharged in accordance with this Agreement; provided, that, Borrower shall have no liability pursuant to this clause (iv) if there are sufficient amounts on reserve with Agent for the payment of such Taxes, charges for labor or materials or other charges or judgments and Agent fails to make the same available to Borrower to pay the same (provided Agent’s use of such funds is not restricted USActive 36631986.12 -78- due to any act or omission of a Borrower Party); and further provided, that, there shall not be liability pursuant to this clause (iv) for failure to pay Taxes, charges for labor or materials or other charges or judgments that can create Liens on any portion of a Property due to the insufficiency of cash flow from the Property to pay such amounts as and when, and with the priority, required pursuant to the Loan Documents, and such insufficiency is not a result of misappropriation of Rents by any Borrower Party;
(v) Borrower’s failure to maintain an Interest Rate Cap Agreement in a notional amount equal to the principal amount of the Loan then advanced and outstanding in compliance with the terms and provisions of Section 2.8;
(vi) intentional misapplication or conversion misappropriation by any Borrower or any affiliate thereof Party in contravention of the Loan Documents of (iA) any insurance proceeds paid by reason of any loss, damage or destruction to the Property, (iiB) any awards or other amounts received in connection with the condemnation of all or a portion of the Property, (iiiC) any Rents following an Event proceeds of Default the Advances or (ivD) any Rents paid more than one (1) month in advance;
(f) revenues from the Property, including Borrower’s failure to pay charges for labor or materials or taxes or other charges that can create liens superior deliver to the lien of the Mortgage on any portion of the Property unless such taxes or other charges are being contested in accordance herewith or such taxes or charges have been delivered to Lender in accordance with Section 3.3 hereof or Borrower has complied with Section 5.2 hereof; and
(g) Agent any security deposits, advance deposits collected by Borrower or any affiliate thereof other deposits held by or on behalf of Borrower with respect to the Property which are not delivered to Lender upon a Agent’s foreclosure of the Property or action in lieu thereof, thereof (except to the extent any such security deposits were applied in accordance with the terms and conditions of the leases); and
(vii) any of the Leases prior litigation or other legal proceeding related to the occurrence Loan filed by Borrower, any Borrower Party or any affiliate of Sponsor that delays, opposes, impedes, obstructs, hinders, enjoins or otherwise interferes with or frustrates the Event efforts of Default that gave rise Agent or Lender to such foreclosure exercise any rights and remedies available to Agent or action in lieu thereof. Lender, other than good faith actions and compulsory counterclaims.
(c) Notwithstanding anything to the contrary in this Agreement, the Note or any of the Loan Documents Documents, (iA) neither Agent nor Lender shall not be deemed to have waived any right which Agent or Lender may have under Section 506(a), 506(b), 1111(b) or any other provisions of the U.S. Bankruptcy Code to file a claim for the full amount of the Debt secured by the Building Loan Mortgage or to require that all collateral shall continue to secure all of the Debt owing to Lender Obligations in accordance with the Loan Documents, and (iiB) Borrower shall be personally liable for the payment of the entire amount of the Debt shall become fully recourse to Borrower (but not its members (other than Guarantor solely to the extent provided in the Non-Recourse Guaranty) or other direct or indirect constituent members or partners or any other Person) in the event that: of:
(Ai) the first full Monthly Debt Service Payment Amount (as defined in the Note) under the Note is not paid when due; (B) other than in connection with a default under subsection (x) of the definition of Special Purpose Bankruptcy Remote Entity set forth in Schedule 5 hereto, Borrower fails to maintain its status as a Special Purpose Bankruptcy Remote Entity in accordance with the provisions of this Agreement and such failure results in the substantive consolidation of Borrower with another Person; (C) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any subordinate financing or other voluntary lien encumbering the Property; (D) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any assignment, transfer, or conveyance Transfer of the Property or a change in Control of Borrower in violation of Section 5.2.10;
(ii) Borrower, Principal, Guarantor or any interest therein as and to Affiliate of any of them files a voluntary petition under the extent required by this Agreement Bankruptcy Code or any other Federal or state bankruptcy or insolvency laws;
(iii) an Affiliate, officer, director, or representative which Controls, directly or indirectly, Borrower, Principal or Guarantor files, or joins in the Mortgage; filing of, USActive 36631986.12 -79- an involuntary petition against Borrower or (E) (1) if Principal under the Bankruptcy Code or any petition for bankruptcy, reorganization other Federal or arrangement pursuant to federal state bankruptcy or insolvency law, or solicits or causes to be solicited, or otherwise colludes with, petitioning creditors for any similar federal or state law, shall be filed by involuntary petition against Borrower or GuarantorPrincipal from any Person;
(iv) Borrower, Principal, or (2) if Borrower Guarantor or Guarantor any Affiliate of any of them files an answer consenting to, or otherwise joining in, acquiesces in writing or joins or otherwise colludes in any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law filed against it it, by any other PersonPerson under the Bankruptcy Code or any other Federal or state bankruptcy or insolvency law;
(v) any Affiliate, officer, director, or representative which Controls Borrower consents to or acquiesces in writing or joins in an application for the appointment of a custodian, receiver, trustee, or examiner for Borrower or Principal or any portion of the Property (other than at the request of Agent and/or any Lender);
(vi) Borrower or Principal makes an assignment for the benefit of creditors, or admits, in writing in any legal proceeding, its insolvency or its inability to pay its debts as they become due;
(vii) a breach by Borrower or Principal of the negative covenants in Section 5.2.12 which breach is found pursuant to a final, unappealable order of cited by a court of competent jurisdiction as a material factor in the substantive consolidation of Borrower with any other Person or entity that is a debtor in a Bankruptcy Action; or
(viii) Borrower fails to obtain Agent’s prior written consent to any (A) additional Indebtedness not permitted by the Loan Documents or (B) voluntary Lien (other than Permitted Encumbrances except to the extent the definition of the term “Permitted Encumbrances” requires any such consent) encumbering the Property.
(d) Except as to Guarantor as set forth in the Guaranty and the Environmental Indemnity and any other Loan Document to which Guarantor is a party, neither Agent nor Lender shall have solicited or caused to any recourse against, nor shall there be solicited creditors to file any involuntary petition for bankruptcypersonal liability to, reorganization or arrangement pursuant to federal bankruptcy lawthe members of Borrower, or to any similar federal shareholders, members, partners, beneficial interest holders or state law against any other entity or person in the ownership (directly or indirectly) of Borrower (except for Guarantor as provided in the Guaranty and the Environmental Indemnity) with respect to the obligations of Borrower and Guarantor under the Loan. For purposes of clarification, in no event shall the above language limit, reduce or otherwise affect Borrower’s liability or obligations under the Loan Documents, Guarantor’s liability under the Guaranty or the Environmental Indemnity or any other Loan Document to which Guarantor is a party, or (3) if Borrower Lender’s right to exercise any rights or Guarantor are found, pursuant to a final unappealable order of a court of competent jurisdiction, to have been in collusion with creditors that initiate a bankruptcy action or proceeding remedies against Borrower or Guarantor or (F) an Event of Default described in Section 8.1(s) hereof shall have occurred.any collateral securing the Loan. USActive 36631986.12 -80-
Appears in 1 contract
Samples: Building Loan Agreement (KBS Strategic Opportunity REIT, Inc.)
Exculpation. Subject Notwithstanding anything herein or in any other Loan Document to the qualifications belowcontrary, except as otherwise set forth in this Section 8.14 to the contrary, Lender shall not enforce the liability and obligation of any Borrower (or its constituent members, partners, of a Borrower's members or shareholders, directors, employees if and to the extent such liability or agents obligation exists or the direct or indirect constituent members, partners, shareholders, directors, employees or agents thereof (collectively, the “Borrower Parties”arises) or any other Person, to perform and observe the obligations contained in this Agreement, the Note Notes, the Mortgages, the Second Mortgages or any of the other Loan Documents executed and delivered by a Borrower by any action or proceeding wherein a money judgment shall be sought against any of the a Borrower Parties or any other Personits members or shareholders, except that Lender may bring a foreclosure action, an action for specific performance or any other appropriate action or proceeding (including, without limitation, to enable obtain a deficiency judgment) against a Borrower solely for the purpose of enabling Lender to enforce and realize upon (i) a Borrower's interest in the Mortgaged Property, (ii) the Rents and Accounts arising from the Individual Properties to the extent received by a Borrower or a Manager after the occurrence of an Event of Default and not deposited in the applicable Property Collection Account pursuant to Section 2.12(a) (all such Rents and Accounts, the "Recourse Distributions") and (iii) any other collateral given to Lender pursuant to this Agreement under the Loan Documents ((i), (ii) and (iii), collectively, the other Loan Documents"Default Collateral"); provided, however, that, except as specifically provided herein, that any judgment in any such action or proceeding shall be enforceable against the Borrower Parties only to the extent of their interest any such Default Collateral. The provisions of this Section 8.14 shall not, however, (a) impair the validity of the Indebtedness evidenced by the Notes or in any way affect or impair the PropertyLiens of the Mortgages, the Rents and in any other collateral given to Lender, and Lender, by accepting this Agreement, the Note and the other Loan Documents, agrees that it shall not sxx for, seek or demand any deficiency judgment against any of the Borrower Parties or any other Person in any such action or proceeding under or by reason of or in connection with this Agreement, the Note Second Mortgages or any of the other Loan Documents. The provisions Documents or the right of this paragraph shall not, however, (i) constitute a waiver, release Lender to foreclose the Mortgages or impairment the Second Mortgages following an Event of any obligation evidenced or secured by this Agreement, the Note or any of the other Loan DocumentsDefault; (iib) impair the right of Lender to name any of the a Borrower Parties, as a party defendant in any action or suit for judicial foreclosure and sale under any of the MortgageMortgages or the Second Mortgages; (iiic) affect the validity or enforceability of any guaranty made in connection with the Notes, the Mortgages, the Second Mortgages or the other Loan or any rights and remedies Documents subject to the limitations of Lender thereunderthis Section 8.14; (ivd) impair the right of Lender to obtain the appointment of a receiver; (ve) impair the enforcement of the Assignment Assignments of Leases Leases, the Second Assignments to Leases, the Assignments of Agreements, the Second Assignments of Agreements or the Manager's Subordinations (subject to the nonrecourse provisions thereof); (f) impair the right of Lender to bring suit for actual (but not consequential) damages, losses and Rents; costs resulting from (i) fraud, (ii) intentional misrepresentation, (iii) physical waste or removal of the Mortgaged Properties or any portion thereof other than as permitted pursuant to the Loan Documents or (viiv) constitute disposal of the Mortgaged Properties or any portion thereof other than as permitted pursuant to the Loan Documents, in each case by a waiver Borrower, MM, Manager, MEI or any of their respective Affiliates in connection with this Agreement, the Notes, the Mortgages, the Second Mortgages or the other Loan Documents; (g) impair the right of Lender to obtain the Recourse Distributions received by a Borrower, including, without limitation, the right to proceed against a Borrower's members or shareholders to the extent any Recourse Distributions have actually theretofore been distributed to a Borrower's members or shareholders; (h) impair the right of Lender to bring suit with respect to a Borrower's misappropriation of security deposits or Rents collected more than one month in advance; (i) impair the right of Lender to obtain Insurance Proceeds or Condemnation Proceeds due to Lender pursuant to the Mortgages or the Second Mortgages; (j) impair the right of Lender to enforce the liability and obligation provisions of Section 4.1(P) or 5.1(D)-(I) even after repayment in full of the Indebtedness; (k) prevent or in any way hinder Lender from exercising, or constitute a defense, or counterclaim, or other basis for relief in respect of the exercise of, any other remedy against any or all of the Collateral as provided in the Loan Documents; (l) impair the right of Lender to bring suit with respect to any misapplication of any funds; (m) impair the right of Lender to xxx for, seek or demand a deficiency judgment against a Borrower (but not against any members of Borrower (other than Guarantor to the extent provided in the Non-Recourse Guaranty) or their direct or indirect constituent a Borrower's members or partners shareholders) solely for the purpose of foreclosing the Mortgaged Property or any other Person)part thereof, by money or realizing upon the Default Collateral; provided, however, that any such deficiency judgment or otherwise, referred to in this clause (m) shall be enforceable against a Borrower only to the extent of any loss, damage, cost, expense, liability, claim or other obligation (but excluding any punitive, consequential or speculative damages) incurred by Lender (including attorneys’ fees and costs reasonably incurred) arising out of or in connection with the following:
(a) fraud or intentional misrepresentation by Borrower or Guarantor in connection with the Loan;
(b) intentional physical waste of the Property (including, but not limited to, waste due to gross negligence) by Borrower or any affiliate thereofDefault Collateral; provided, however, such physical waste shall exclude wear and tear to the Property that occurs in the ordinary course of business of the Property by Borrower or any affiliate thereof;
(c) the material breach of any representation, warranty, covenant or indemnification provision in the Environmental Indemnity or in this Agreement concerning Environmental Laws, Hazardous Substances and Asbestos;
(d) the removal or disposal by Borrower or any affiliate thereof of any portion of the Property after an Event of Default has occurred and while it is continuing, unless such portion of the Property is replaced by an item of equal or greater value as determined by Lender in its reasonable discretion;
(e) the misapplication or conversion by Borrower or any affiliate thereof of (i) any insurance proceeds paid by reason of any loss, damage or destruction to the Property, (ii) any awards or other amounts received in connection with the condemnation of all or a portion of the Property, (iii) any Rents following an Event of Default or (ivn) any Rents paid more than one (1) month in advance;
(f) failure impair the right of Lender to pay charges for labor or materials or taxes or other charges that can create liens superior to enforce the lien of the Mortgage on any portion of the Property unless such taxes or other charges are being contested in accordance herewith or such taxes or charges have been delivered to Lender in accordance with Section 3.3 hereof or Borrower has complied with Section 5.2 hereof; and
(g) any security deposits collected by Borrower or any affiliate thereof with respect to the Property which are not delivered to Lender upon a foreclosure of the Property or action in lieu thereof, except to the extent any such security deposits were applied in accordance with the terms and conditions of any of the Leases prior to the occurrence of the Event of Default that gave rise to such foreclosure or action in lieu thereofGuaranty. Notwithstanding anything to the contrary in any of the Loan Documents (i) Lender shall not be deemed to have waived any right which Lender may have under Section 506(a), 506(b), 1111(b) or any other provisions of the U.S. Bankruptcy Code to file a claim for the full amount of the Debt or to require that all collateral shall continue to secure all of the Debt owing to Lender in accordance with the Loan Documents, and (ii) the Debt shall become fully recourse to Borrower (but not its members (other than Guarantor solely to the extent provided in the Non-Recourse Guaranty) or other direct or indirect constituent members or partners or any other Person) in the event that: (A) the first full Monthly Debt Service Payment Amount (as defined in the Note) under the Note is not paid when due; (B) other than in connection with a default under subsection (x) of the definition of Special Purpose Bankruptcy Remote Entity set forth in Schedule 5 hereto, Borrower fails to maintain its status as a Special Purpose Bankruptcy Remote Entity in accordance with the The provisions of this Agreement and such failure results in the substantive consolidation of Section 8.14 shall be inapplicable to a Borrower with another Person; (C) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any subordinate financing or other voluntary lien encumbering the Property; (D) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any assignment, transfer, or conveyance of the Property or any interest therein as and to the extent required by this Agreement or the Mortgage; or (E) (1) if any petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law, law shall be filed by, consented to or acquiesced in by Borrower or Guarantorwith respect to such Borrower, or (2) if a Borrower shall institute any proceeding for the dissolution or Guarantor files an answer consenting toliquidation of itself, or otherwise joining inif a Borrower shall make an assignment for the benefit of creditors, any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law filed against it by any other Person, or is found pursuant to a final, unappealable order of a court of competent jurisdiction to have solicited or caused to be solicited creditors to file any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law against Borrower or Guarantor, or (3) if Borrower or Guarantor are found, pursuant to a final unappealable order of a court of competent jurisdiction, to have been in collusion with creditors that initiate a bankruptcy action or proceeding against Borrower or Guarantor or (F) an Event of Default described in Section 8.1(s) hereof which event Lender shall have occurredrecourse against all of the assets of such Borrower and the interests in such Borrower owned by, and the Recourse Distributions received by, such Borrower's members or shareholders (but excluding all other assets of such Borrower's members or shareholders). Notwithstanding the foregoing, in the event an Individual Property is released from the lien created by the Related Mortgages, Borrower shall be released in all respects from any further liability with respect to the Loan other than any further liability for certain kinds of environmental matters arising under Section 4.1(P) or 5.1(D) - (I) as the same applies to such Individual Property.
Appears in 1 contract
Samples: Loan Agreement (American Real Estate Investment Corp)
Exculpation. Subject to the qualifications below, Lender shall not enforce the liability and obligation of Borrower or its constituent members, partners, shareholders, directors, employees or agents or the direct or indirect constituent members, partners, shareholders, directors, employees or agents thereof (collectively, the “Borrower Parties”) or any other Person, to perform and observe the obligations contained in this Agreement, the Note or any of the other Loan Documents by any action or proceeding wherein a money judgment shall be sought against any of the Borrower Parties or any other PersonBorrower, except that Lender may bring a foreclosure action, an action for specific performance or any other appropriate action or proceeding to enable Lender to enforce and realize upon its interest and rights under the PropertyLoan Documents, the Rents or in all or any other collateral given to Lender pursuant to this Agreement and portion of the other Loan DocumentsCollateral; provided, however, that, except as specifically provided herein, any judgment in any such action or proceeding shall be enforceable against the Borrower Parties only to the extent of their Borrower’s interest in the Property, the Rents and in any other collateral given to LenderCollateral, and Lender, by accepting this Agreement, the Note and the other Loan Documents, agrees that it Lender shall not sxx xxx for, seek or demand any deficiency judgment against any of the Borrower Parties or any other Person in any such action or proceeding under or by reason of or under or in connection with this Agreement, the Note or any of the other Loan DocumentsDocument. The provisions of this paragraph Section shall not, however, (i) constitute a waiver, release or impairment of any obligation evidenced or secured by this Agreement, the Note or any of the other Loan DocumentsDocument; (ii) impair the right of Lender to name any of the Borrower Parties, as a party defendant in any action or suit for foreclosure and sale under any of the MortgageSecurity Documents; (iii) affect the validity or enforceability of any of the Loan Documents or any guaranty made in connection with the Loan or any of the rights and remedies of Lender thereunder; (iv) impair the right of Lender to obtain the appointment of a receiver; (v) impair constitute a prohibition against Lender to commence any other appropriate action or proceeding in order for Lender to fully realize the enforcement security granted by the Pledge or the other Security Documents or to exercise its remedies against all or any portion of the Assignment of Leases and RentsCollateral; or (vi) constitute a waiver of the right of Lender to enforce the liability and obligation of Borrower (but not against any members of Borrower (other than Guarantor to the extent provided in the Non-Recourse Guaranty) its constituent members, partners, officers, directors or their direct or indirect constituent members or partners or any other Personshareholders), by money judgment or otherwise, to the extent of any loss, damage, cost, expense, liability, claim or other obligation (but excluding any punitive, consequential or speculative damages) incurred by Lender (including attorneys’ fees and costs reasonably incurred) arising out of or in connection with the following:
following (all such liability and obligation of Borrower for any or all of the following being referred to herein as “Borrower’s Recourse Liabilities”): (a) fraud or intentional misrepresentation by Borrower Borrower, Sole Member, Owner or Guarantor in connection with obtaining the Loan;
; (b) intentional physical waste of the Property or any portion thereof, or after an Event of Default the removal or disposal of any portion of the Property; (includingc) any Proceeds paid by reason of any Insured Casualty or any Award received in connection with a Condemnation or other sums or payments attributable to the Property to the extent not applied in accordance with the provisions of the Loan Documents and the Senior Loan Documents (except to the extent that Borrower or Owner did not have the legal right, but because of a bankruptcy, receivership or similar judicial proceeding, to direct disbursement of such sums or payments); (d) all Rents of the Property received or collected by or on behalf of Borrower or Owner after an Event of Default and not limited toapplied to payment of Principal and interest due under the Note or under the Senior Loan or otherwise as provided for in the Loan Documents and the Senior Loan Documents, waste and to the payment of actual and reasonable operating expenses of the Property, as they become due or payable (except to gross negligencethe extent that such application of such funds is prevented by bankruptcy, receivership, or similar judicial proceeding in which Borrower or Owner is legally prevented from directing the disbursement of such sums); (e) misappropriation (including failure to turn over to Lender on demand following an Event of Default) of tenant security deposits and rents collected in advance; (f) the failure by Borrower or any affiliate thereof; providedOwner to pay Taxes or Insurance Premiums, however, such physical waste provided Borrower shall exclude wear and tear not be liable to the Property that occurs extent funds to pay such amounts are available in the ordinary course Tax and Insurance Subaccount pursuant to the Senior Loan Agreement and Senior Lender failed to pay same; (g) the failure to pay transfer fees and charges due Lender under the Loan Documents in connection with any subordinate financing or any transfer of business all or any part of the Property by Borrower or the Collateral, or any affiliate thereof;
interest therein, from Borrower to Borrower’s transferee, or transfer of beneficial interest in Borrower; and (ch) the material breach of any representation, warranty, covenant or indemnification provision in the Environmental Indemnity or in this Agreement any Loan Document concerning Environmental LawsLaws or Hazardous Substances, Hazardous Substances including Sections 4.21 and Asbestos;
5.10, and clauses (dviii) the removal or disposal by Borrower or any affiliate thereof through (xi) of any portion of the Property after an Event of Default has occurred and while it is continuing, unless such portion of the Property is replaced by an item of equal or greater value as determined by Lender in its reasonable discretion;
(e) the misapplication or conversion by Borrower or any affiliate thereof of (i) any insurance proceeds paid by reason of any loss, damage or destruction to the Property, (ii) any awards or other amounts received in connection with the condemnation of all or a portion of the Property, (iii) any Rents following an Event of Default or (iv) any Rents paid more than one (1) month in advance;
(f) failure to pay charges for labor or materials or taxes or other charges that can create liens superior to the lien of the Mortgage on any portion of the Property unless such taxes or other charges are being contested in accordance herewith or such taxes or charges have been delivered to Lender in accordance with Section 3.3 hereof or Borrower has complied with Section 5.2 hereof; and
(g) any security deposits collected by Borrower or any affiliate thereof with respect to the Property which are not delivered to Lender upon a foreclosure of the Property or action in lieu thereof, except to the extent any such security deposits were applied in accordance with the terms and conditions of any of the Leases prior to the occurrence of the Event of Default that gave rise to such foreclosure or action in lieu thereof5.30. Notwithstanding anything to the contrary in this Agreement or any of the Loan Documents Documents, (ia) Lender shall not be deemed to have waived any right which Lender may have under Section 506(a)) , 506(b)) , 1111(b) or any other provisions of the U.S. Bankruptcy Code to file a claim for the full amount of the Debt or to require that all collateral shall continue to secure all of the Debt owing to Lender in accordance with the Loan Documents, and (iib) Lender’s agreement not to pursue personal liability of Borrower as set forth above SHALL BECOME NULL AND VOID and shall be of no further force and effect, and the Debt shall become be fully recourse to Borrower and Guarantor (but not its members (other than Guarantor solely to the extent provided in the Non-Recourse Guaranty) any of Borrower’s constituent members, partners, officers, directors or other direct or indirect constituent members or partners or any other Personshareholders) in the event that: (A) the first full Monthly Debt Service Payment Amount (as defined in the Note) under the Note is not paid when due; (B) other than in connection with a default under subsection (x) that one or more of the definition of Special Purpose Bankruptcy Remote Entity set forth in Schedule 5 heretofollowing occurs (each, Borrower fails to maintain its status as a Special Purpose Bankruptcy Remote Entity in accordance with the provisions of this Agreement and such failure results in the substantive consolidation of Borrower with another Person; “Springing Recourse Event”): (C) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any subordinate financing or other voluntary lien encumbering the Property; (D) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any assignment, transfer, or conveyance of the Property or any interest therein as and to the extent required by this Agreement or the Mortgage; or (E) (1) if any petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law, shall be filed by Borrower or Guarantor, or (2) if Borrower or Guarantor files an answer consenting to, or otherwise joining in, any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law filed against it by any other Person, or is found pursuant to a final, unappealable order of a court of competent jurisdiction to have solicited or caused to be solicited creditors to file any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law against Borrower or Guarantor, or (3) if Borrower or Guarantor are found, pursuant to a final unappealable order of a court of competent jurisdiction, to have been in collusion with creditors that initiate a bankruptcy action or proceeding against Borrower or Guarantor or (Fi) an Event of Default described in Section 8.1(s8.1(d) hereof shall have occurredoccurred (solely as a result of a voluntary Transfer), or (ii) a breach of the covenants set forth in Section 5.15, or (iii) Borrower’s voluntary commencement of proceedings to be adjudicated bankrupt or insolvent; Borrower’s consent to the institution of bankruptcy or insolvency proceedings against it; Borrower’s filing of a petition seeking, or consent to, reorganization or relief under any applicable federal or state law relating to bankruptcy or insolvency; Borrower’s consent to the appointment of a receiver, liquidator, assignee, trustee, sequestrator (or other similar official) of Borrower or a substantial part of Borrower’s property; Borrower’s assignment for the benefit of creditors; or the filing of an involuntary petition in bankruptcy or insolvency proceedings against Borrower by any principal of or owner of any interest in Borrower or any affiliate of or party related to Borrower (but excluding any owner or affiliate that indirectly owns or is affiliated with Borrower solely from its ownership of shares in the REIT).
Appears in 1 contract
Samples: Mezzanine Loan Agreement (KBS Real Estate Investment Trust, Inc.)
Exculpation. Subject to the qualifications below, Lender shall not enforce the liability and obligation of Borrower or its constituent members, partners, shareholders, directors, employees or agents or the direct or indirect constituent members, partners, shareholders, directors, employees or agents thereof (collectively, the “Borrower Parties”) or any other Person, to perform and observe the obligations contained in this Agreement, the Note or any of the other Loan Documents by any action or proceeding wherein a money judgment shall be sought against any of the Borrower Parties or any other Person, except that Lender may bring a foreclosure action, an action for specific performance or any other appropriate action or proceeding to enable Lender to enforce and realize upon the Property, the Rents or any other collateral given to Lender pursuant to this Agreement and the other Loan Documents; provided, however, that, except as specifically provided herein, any judgment in any such action or proceeding shall be enforceable against the Borrower Parties only to the extent of their interest in the Property, the Rents and in any other collateral given to Lender, and Lender, by accepting this Agreement, the Note and the other Loan Documents, agrees that it shall not sxx xxx for, seek or demand any deficiency judgment against any of the Borrower Parties or any other Person in any such action or proceeding under or by reason of or in connection with this Agreement, the Note or any of the other Loan Documents. The provisions of this paragraph shall not, however, (i) constitute a waiver, release or impairment of any obligation evidenced or secured by this Agreement, the Note or any of the other Loan Documents; (ii) impair the right of Lender to name any of the Borrower Parties, as a party defendant in any action or suit for foreclosure and sale under the Mortgage; (iii) affect the validity or enforceability of any guaranty made in connection with the Loan or any rights and remedies of Lender thereunder; (iv) impair the right of Lender to obtain the appointment of a receiver; (v) impair the enforcement of the Assignment of Leases and Rents; or (vi) constitute a waiver of the right of Lender to enforce the liability and obligation of Borrower (but not against any members of Borrower (other than Guarantor to the extent provided in the Non-Recourse Guaranty and/or the Partial Payment Guaranty) or their direct or indirect constituent members or partners or any other Person), by money judgment or otherwise, to the extent of any loss, damage, cost, expense, liability, claim or other obligation (but excluding any punitive, consequential or speculative damages) incurred by Lender (including attorneys’ fees and costs reasonably incurred) arising out of or in connection with the following:
(a) fraud or intentional misrepresentation by Borrower or Guarantor in connection with the Loan;
(b) intentional physical waste of the Property (including, but not limited to, waste due to gross negligence) by Borrower or any affiliate thereof; provided, however, such physical waste shall exclude wear and tear to the Property that occurs in the ordinary course of business of the Property by Borrower or any affiliate thereof;
(c) the material breach of any representation, warranty, covenant or indemnification provision in the Environmental Indemnity or in this Agreement concerning Environmental Laws, Hazardous Substances and Asbestos;
(d) the removal or disposal by Borrower or any affiliate thereof of any portion of the Property after an Event of Default has occurred and while it is continuing, unless such portion of the Property is replaced by an item of equal or greater value as determined by Lender in its reasonable discretion;
(e) the misapplication or conversion by Borrower or any affiliate thereof of (i) any insurance proceeds paid by reason of any loss, damage or destruction to the Property, (ii) any awards or other amounts received in connection with the condemnation of all or a portion of the Property, (iii) any Rents following an Event of Default or (iv) any Rents paid more than one (1) month in advance;
(f) failure to pay charges for labor or materials or taxes or other charges that can create liens superior to the lien of the Mortgage on any portion of the Property unless such taxes or other charges are being contested in accordance herewith or such taxes or charges have been delivered to Lender in accordance with Section 3.3 hereof or Borrower has complied with Section 5.2 hereof; and
(g) any security deposits collected by Borrower or any affiliate thereof with respect to the Property which are not delivered to Lender upon a foreclosure of the Property or action in lieu thereof, except to the extent any such security deposits were applied in accordance with the terms and conditions of any of the Leases prior to the occurrence of the Event of Default that gave rise to such foreclosure or action in lieu thereof. Notwithstanding anything to the contrary in any of the Loan Documents (i) Lender shall not be deemed to have waived any right which Lender may have under Section 506(a), 506(b), 1111(b) or any other provisions of the U.S. Bankruptcy Code to file a claim for the full amount of the Debt or to require that all collateral shall continue to secure all of the Debt owing to Lender in accordance with the Loan Documents, and (ii) the Debt shall become fully recourse to Borrower (but not its members (other than Guarantor solely to the extent provided in the Non-Recourse Guaranty and/or the Partial Payment Guaranty) or other direct or indirect constituent members or partners or any other Person) in the event that: (A) the first full Monthly Debt Service Payment Amount (as defined in the Note) under the Note is not paid when due; (B) other than in connection with a default under subsection (x) of the definition of Special Purpose Bankruptcy Remote Entity set forth in Schedule 5 hereto, Borrower fails to maintain its status as a Special Purpose Bankruptcy Remote Entity in accordance with the provisions of this Agreement and such failure results in the substantive consolidation of Borrower with another Person; (C) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any subordinate financing or other voluntary lien encumbering the Property; (D) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any assignment, transfer, or conveyance of the Property or any interest therein as and to the extent required by this Agreement or the Mortgage; or (E) (1) if any petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law, shall be filed by Borrower or Guarantor, or (2) if Borrower or Guarantor files an answer consenting to, or otherwise joining in, any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law filed against it by any other Person, or is found pursuant to a final, unappealable order of a court of competent jurisdiction to have solicited or caused to be solicited creditors to file any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law against Borrower or Guarantor, or (3) if Borrower or Guarantor are found, pursuant to a final unappealable order of a court of competent jurisdiction, to have been in collusion with creditors that initiate a bankruptcy action or proceeding against Borrower or Guarantor or (F) an Event of Default described in Section 8.1(s) hereof shall have occurredGuarantor.
Appears in 1 contract
Exculpation. Subject to the qualifications below(a) The Agent shall have no duties or responsibilities, Lender implied by application of law or otherwise, except those expressly set out in this Agreement. The Agent shall not enforce be required to make any decision or take any action which may expose it to personal liability or which, in its sole discretion, may be contrary to this Agreement or any Applicable Law. As between the liability Agent and obligation each of Borrower or the Lenders, neither the Agent nor any of its constituent members, partners, shareholdersofficers, directors, employees or agents shall be liable for any action taken or omitted to be taken under the direct or indirect constituent members, partners, shareholders, directors, employees or agents thereof (collectively, the “Borrower Parties”) or any other Person, to perform and observe the obligations contained in this Agreement, the Note or any of the other Loan Documents by any action or proceeding wherein a money judgment shall be sought against any of the Borrower Parties or any other Person, except that Lender may bring a foreclosure action, an action for specific performance or any other appropriate action or proceeding to enable Lender to enforce and realize upon the Property, the Rents or any other collateral given to Lender pursuant to this Agreement and the other Loan Documents; provided, however, that, except as specifically provided herein, any judgment in any such action or proceeding shall be enforceable against the Borrower Parties only to the extent of their interest in the Property, the Rents and in any other collateral given to Lender, and Lender, by accepting this Agreement, the Note and the other Loan Documents, agrees that it shall not sxx for, seek or demand any deficiency judgment against any of the Borrower Parties or any other Person in any such action or proceeding under or by reason of or in connection with this Agreement, the Note or any of the other Loan Documents. The provisions of this paragraph shall not, however, (i) constitute a waiver, release or impairment of any obligation evidenced or secured by this Agreement, the Note or any of the other Loan Documents; (ii) impair the right of Lender to name any of the Borrower Parties, as a party defendant in any action or suit for foreclosure and sale under the Mortgage; (iii) affect the validity or enforceability of any guaranty made in connection with the Loan Documents, unless caused by their fraudulent conduct or wilful misconduct. Nothing in this Agreement or any rights and remedies of Lender thereunder; (iv) impair the right of Lender to obtain the appointment of a receiver; (v) impair the enforcement of the Assignment of Leases and Rents; Loan Documents, expressed or (vi) constitute a waiver implied, is intended to, or shall be construed in any way so as to, impose upon the Agent any obligation except as expressly set out in this Agreement or the Loan Documents. Without limiting the generality of the right of Lender to enforce foregoing, the liability and obligation of Agent shall not be responsible for any calculation, recitals, statements, representations or warranties made by the Borrower (but not against or any members of Borrower (other than Guarantor to the extent provided in the Non-Recourse Guaranty) Loan Documents or their direct which may be contained in any Loan Document subsequently entered into by the Agent or indirect constituent members in any verbal or partners written information provided by the Borrower, any Guarantor or any other Person)Subsidiary thereof for the benefit of the Lenders or for the authorization, by money judgment execution, effectiveness, genuineness, validity or otherwiseenforceability of the Loan Documents or any other instruments and agreements referred to therein and shall not be required to make any inquiry or investigation concerning the performance, to the extent compliance or observance of any lossof the terms, damage, cost, expense, liability, claim provisions or conditions of the Loan Documents or any other obligation (but excluding any punitive, consequential instruments or speculative damages) incurred by Lender (including attorneys’ fees and costs reasonably incurred) agreements referred to therein or arising out of or in connection with the following:
(a) fraud or intentional misrepresentation by Borrower or Guarantor in connection with the Loan;therefrom.
(b) intentional physical waste Each of the Property (including, but not limited to, waste due to gross negligence) by Borrower or any affiliate thereof; provided, however, such physical waste shall exclude wear Lenders severally represents and tear warrants to the Property Agent that occurs in the ordinary course of business it has made and shall continue to make such independent investigation of the Property by Borrower or any affiliate thereof;
(c) the material breach of any representation, warranty, covenant or indemnification provision in the Environmental Indemnity or in this Agreement concerning Environmental Laws, Hazardous Substances financial condition and Asbestos;
(d) the removal or disposal by Borrower or any affiliate thereof of any portion affairs of the Property after an Event of Default has occurred Borrower and while it is continuing, unless the Guarantors as such portion of the Property is replaced by an item of equal or greater value as determined by Lender in its reasonable discretion;
(e) the misapplication or conversion by Borrower or any affiliate thereof of (i) any insurance proceeds paid by reason of any loss, damage or destruction deems for itself to the Property, (ii) any awards or other amounts received be appropriate in connection with the condemnation of all or a portion of the Property, (iii) any Rents following an Event of Default or (iv) any Rents paid more than one (1) month in advance;
(f) failure to pay charges for labor or materials or taxes or other charges that can create liens superior to the lien of the Mortgage on any portion of the Property unless such taxes or other charges are being contested in accordance herewith or such taxes or charges have been delivered to Lender in accordance with Section 3.3 hereof or Borrower has complied with Section 5.2 hereof; and
(g) any security deposits collected by Borrower or any affiliate thereof with respect to the Property which are not delivered to Lender upon a foreclosure of the Property or action in lieu thereof, except to the extent any such security deposits were applied in accordance with the terms and conditions of any of the Leases prior to the occurrence of the Event of Default that gave rise to such foreclosure or action in lieu thereof. Notwithstanding anything to the contrary in any of the Loan Documents (i) and the making and continuance of Advances under the Credit Facilities, that such Lender has and shall continue to make its own appraisal of the creditworthiness of the Borrower and the Guarantors and that such Lender in connection with such investigation and appraisal has not relied upon any information provided to such Lender by the Agent, including any legal advice provided to the Agent by its counsel. The Agent may at any time request instructions or directions from the Lenders with respect to any actions or approvals which, by the terms of this Agreement, the Agent is permitted or required to take or to grant, and the Agent shall be absolutely entitled to refrain from taking any action or to withhold any approval and shall not be deemed under any liability whatsoever to any Lender for refraining from taking any action or withholding any approval under the Loan Documents until it has received such written instructions or directions from the Lenders. No Lender shall have waived any right which Lender may have under Section 506(a), 506(b), 1111(b) of action or any other provisions recourse whatsoever against the Agent as a result of the U.S. Bankruptcy Code to file a claim for the full amount Agent acting or refraining from acting under any of the Debt Loan Documents in accordance with instructions or directions received from the Lenders. The Lenders have reviewed the consequences of entering into and performing obligations and receiving amounts under this Agreement, including the Canadian income tax consequences in respect thereof, and are not relying on any information provided by the Agent, including any legal or tax advice provided to require that all collateral the Agent by its counsel.
(c) The Agent may consult with its own legal counsel, Borrower's Counsel, independent public accountants and other experts and advisors selected by it and shall continue not be liable for any action taken or omitted to secure all of the Debt owing to Lender be taken in good faith in accordance with the Loan Documentsadvice of such counsel, accountants, experts or advisors.
(d) The Agent does not make any warranty or representation to any Lender and (ii) is not responsible to any Lender for the Debt shall become fully recourse to Borrower (but not its members (other than Guarantor solely accuracy or completeness of any information or data made available to the extent provided in the Non-Recourse Guaranty) or other direct or indirect constituent members or partners or any other Person) in the event that: (A) the first full Monthly Debt Service Payment Amount (as defined in the Note) under the Note is not paid when due; (B) other than Lender in connection with a default under subsection (x) the syndication of the definition Credit Facilities, or for any statements, warranties or representations (whether written or oral) made in or in connection with any of Special Purpose Bankruptcy Remote Entity set forth in Schedule 5 heretothe Loan Documents. The Agent shall have no duty to ascertain or to enquire as to the performance or observation of any of the terms, Borrower fails to maintain its status as a Special Purpose Bankruptcy Remote Entity in accordance with the provisions covenants or conditions of this Agreement and such failure results in the substantive consolidation of Borrower with another Person; (C) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent where applicable. The Agent shall not be responsible to any subordinate financing Lender for the due execution, legality, validity, enforcement, genuineness, sufficiency or other voluntary lien encumbering value of any of the Property; (D) except as otherwise permitted pursuant Loan Documents and shall not have any duty to procure funds for any payment required hereunder, including, without limitation, by charging any account of the Borrower maintained with the Agent for any amount due to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any assignment, transfer, or conveyance of the Property or any interest therein as and to the extent required by this Agreement or the Mortgage; or (E) (1) if any petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law, shall be filed by Borrower or Guarantor, or (2) if Borrower or Guarantor files an answer consenting to, or otherwise joining in, any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law filed against it by any other Person, or is found pursuant to a final, unappealable order of a court of competent jurisdiction to have solicited or caused to be solicited creditors to file any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law against Borrower or Guarantor, or (3) if Borrower or Guarantor are found, pursuant to a final unappealable order of a court of competent jurisdiction, to have been in collusion with creditors that initiate a bankruptcy action or proceeding against Borrower or Guarantor or (F) an Event of Default described in Section 8.1(s) hereof shall have occurredLenders hereunder.
Appears in 1 contract
Exculpation. Subject Notwithstanding any provision in this Agreement to the qualifications belowcontrary, Lender it is agreed and understood that Purchaser shall look solely to the assets of Seller and Stratus Block 21 Investments in the event of any breach or default by Seller under this Agreement or any breach or default by Xxxxxxx Xxxxx 00 Xxxxxxxxxxx under the Block 21 Service Company Contract, and not enforce to the liability and obligation assets of: (a) any person or entity which is a partner in Stratus Block 21 Investments, or which otherwise owns or holds any ownership interest in Stratus Block 21 Investments, directly or indirectly (each such partner or other holder or owner of Borrower any interest in Xxxxxxx Xxxxx 00 Xxxxxxxxxxx being referred to herein as a “Subtier Owner”); (b) any person or its constituent membersentity which is a member, partnersmanager or partner in or otherwise owns or holds any ownership interest in any Subtier Owner, shareholderswhether directly or indirectly; (c) any person or entity serving as an officer, directorsdirector, employees employee or agents otherwise for or the direct in Seller or indirect constituent membersXxxxxxx Xxxxx 00 Xxxxxxxxxxx; or (d) any person or entity serving as an officer, partnersdirector, shareholders, directors, employees employee or agents thereof otherwise for or in any Subtier Owner. This Agreement is executed by one or more persons (collectively, the “Borrower PartiesSignatories”, whether one or more) or any other Person, to perform of Seller and observe the obligations contained Xxxxxxx Xxxxx 00 Investments solely in this Agreement, the Note or any their capacities as representatives of the other Loan Documents by Seller, Stratus Block 21 Investments or a Subtier Owner and not in their own individual capacities. Purchaser hereby releases and relinquishes the Signatories from any action and all personal liability for any matters or proceeding wherein a money judgment shall be sought against claims of any of the Borrower Parties or any other Person, except that Lender may bring a foreclosure action, an action for specific performance or any other appropriate action or proceeding to enable Lender to enforce and realize upon the Property, the Rents or any other collateral given to Lender pursuant to this Agreement and the other Loan Documents; provided, however, that, except as specifically provided herein, any judgment in any such action or proceeding shall be enforceable against the Borrower Parties only to the extent of their interest in the Property, the Rents and in any other collateral given to Lender, and Lender, by accepting this Agreement, the Note and the other Loan Documents, agrees that it shall not sxx for, seek or demand any deficiency judgment against any of the Borrower Parties or any other Person in any such action or proceeding kind which arise under or by reason of or in connection with or as a result of this Agreement, the Note or any of the other Loan Documents. The provisions foregoing release of this paragraph liability shall not, however, (i) constitute a waiver, release or impairment of any obligation evidenced or secured by this Agreement, the Note or any of the other Loan Documents; (ii) impair the right of Lender to name any of the Borrower Parties, as a party defendant in any action or suit for foreclosure and sale under the Mortgage; (iii) affect the validity or enforceability of any guaranty made in connection with the Loan or any rights and remedies of Lender thereunder; (iv) impair the right of Lender to obtain the appointment of a receiver; (v) impair the enforcement of the Assignment of Leases and Rents; or (vi) constitute a waiver of the right of Lender to enforce the liability and obligation of Borrower (but not against any members of Borrower (other than Guarantor to the extent provided in the Non-Recourse Guaranty) or their direct or indirect constituent members or partners or any other Person), by money judgment or otherwise, to the extent of any loss, damage, cost, expense, liability, claim or other obligation (but excluding any punitive, consequential or speculative damages) incurred by Lender (including attorneys’ fees and costs reasonably incurred) arising out of or in connection with the following:
(a) fraud or intentional misrepresentation by Borrower or Guarantor in connection with the Loan;
(b) intentional physical waste of the Property (including, but not limited to, waste due to gross negligence) by Borrower or any affiliate thereof; provided, however, such physical waste shall exclude wear and tear to the Property that occurs in the ordinary course of business of the Property by Borrower or any affiliate thereof;
(c) the material breach of any representation, warranty, covenant or indemnification provision in the Environmental Indemnity or in this Agreement concerning Environmental Laws, Hazardous Substances and Asbestos;
(d) the removal or disposal by Borrower or any affiliate thereof of any portion of the Property after an Event of Default has occurred and while it is continuing, unless such portion of the Property is replaced by an item of equal or greater value as determined by Lender in its reasonable discretion;
(e) the misapplication or conversion by Borrower or any affiliate thereof of (i) any insurance proceeds paid by reason of any loss, damage or destruction to the Property, (ii) any awards or other amounts received in connection with the condemnation of all or a portion of the Property, (iii) any Rents following an Event of Default or (iv) any Rents paid more than one (1) month in advance;
(f) failure to pay charges for labor or materials or taxes or other charges that can create liens superior to the lien of the Mortgage on any portion of the Property unless such taxes or other charges are being contested in accordance herewith or such taxes or charges have been delivered to Lender in accordance with Section 3.3 hereof or Borrower has complied with Section 5.2 hereof; and
(g) any security deposits collected by Borrower or any affiliate thereof be effective with respect to and shall apply to all claims against any members, managers and partners of any Subtier Owner regardless of whether such claims arise as a result of any liability which the Property which are not delivered to Lender upon a foreclosure Signatories may have as members, managers or partners of the Property or action in lieu thereofSeller, except to the extent any such security deposits were applied in accordance with the terms and conditions of any of the Leases prior to the occurrence of the Event of Default that gave rise to such foreclosure or action in lieu thereof. Notwithstanding anything to the contrary in any of the Loan Documents (i) Lender shall not be deemed to have waived any right which Lender may have under Section 506(a), 506(b), 1111(b) Stratus Block 21 Investments or any other provisions of the U.S. Bankruptcy Code to file a claim for the full amount of the Debt or to require that all collateral shall continue to secure all of the Debt owing to Lender in accordance with the Loan Documents, and (ii) the Debt shall become fully recourse to Borrower (but not its members (other than Guarantor solely to the extent provided in the Non-Recourse Guaranty) or other direct or indirect constituent members or partners or any other Person) in the event that: (A) the first full Monthly Debt Service Payment Amount (as defined in the Note) under the Note is not paid when due; (B) other than in connection with a default under subsection (x) of the definition of Special Purpose Bankruptcy Remote Entity set forth in Schedule 5 hereto, Borrower fails to maintain its status as a Special Purpose Bankruptcy Remote Entity in accordance with the provisions of this Agreement and such failure results in the substantive consolidation of Borrower with another Person; (C) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any subordinate financing or other voluntary lien encumbering the Property; (D) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any assignment, transferSubtier Owner, or conveyance of the Property or any interest therein as and to the extent required by this Agreement or the Mortgage; or (E) (1) if any petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law, shall be filed by Borrower or Guarantor, or (2) if Borrower or Guarantor files an answer consenting to, or otherwise joining in, any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law filed against it by any other Person, or is found pursuant to a final, unappealable order of a court of competent jurisdiction to have solicited or caused to be solicited creditors to file any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law against Borrower or Guarantor, or (3) if Borrower or Guarantor are found, pursuant to a final unappealable order of a court of competent jurisdiction, to have been in collusion with creditors that initiate a bankruptcy action or proceeding against Borrower or Guarantor or (F) an Event of Default described in Section 8.1(s) hereof shall have occurredotherwise.
Appears in 1 contract
Samples: Agreement of Sale and Purchase (Stratus Properties Inc)
Exculpation. (a) Subject to the qualifications below, Lender shall not enforce the liability and obligation of Borrower or its constituent members, partners, shareholders, directors, employees or agents or the direct or indirect constituent members, partners, shareholders, directors, employees or agents thereof (collectively, the “Borrower Parties”) or any other Person, Operating Lessee to perform and observe the obligations contained in the Note, this Agreement, the Note Security Instrument or any of the other Loan Documents by any action or proceeding wherein a money judgment or any deficiency judgment or other judgment establishing personal liability shall be sought against Borrower, Operating Lessee or any principal, director, officer, employee, beneficiary, shareholder, partner, member, trustee, or affiliate of Borrower or Operating Lessee (but specifically excluding Guarantor pursuant to the Guaranty) or any legal representatives, successors or assigns of any of the Borrower Parties or any other Personforegoing (collectively, the “Exculpated Parties”), except that Lender may bring a foreclosure action, an action for specific performance or any other appropriate action or proceeding to enable Lender to enforce and realize upon its interest under the Note, this Agreement, the Security Instrument and the other Loan Documents, or in the Property, the Rents Rents, or any other collateral given to Lender pursuant to this Agreement and the other Loan Documents; provided, however, that, except as specifically provided herein, any judgment in any such action or proceeding shall be enforceable against the Borrower Parties and/or Operating Lessee only to the extent of their Borrower’s or Operating Lessee’s, as applicable, interest in the Property, in the Rents and in any other collateral given to Lender, and Lender, by accepting the Note, this Agreement, the Note Security Instrument and the other Loan Documents, agrees that it shall not sxx xxx for, seek or demand any deficiency judgment against Borrower or Operating Lessee or any of the Borrower Parties or any other Person Exculpated Parties, in any such action or proceeding under or by reason of or under or in connection with the Note, this Agreement, the Note Security Instrument or any of the other Loan Documents. The provisions of this paragraph Section shall not, however, (i1) constitute a waiver, release or impairment of any obligation evidenced or secured by this Agreement, the Note or any of the other Loan Documents; (ii2) impair the right of Lender to name any of the Borrower Parties, and/or Operating Lessee as a party defendant in any action or suit for foreclosure and sale under the MortgageSecurity Instrument; (iii3) affect the validity or enforceability of any guaranty indemnity, guaranty, or similar instrument made in connection with the Loan or any of the rights and remedies of Lender thereunder; (iv4) impair the right of Lender to obtain the appointment of a receiver; (v5) impair the enforcement of the Assignment assignment of Leases leases and Rentsrents contained in the Security Instrument; (6) impair the right of Lender to enforce the provisions of the Environmental Indemnity; (7) constitute a prohibition against Lender to seek a deficiency judgment against Borrower in order to fully realize on any security given by Borrower in connection with the Loan or to commence any other appropriate action or proceeding in order for Lender to exercise its remedies against such security (provided that, Guarantor shall not be liable for such deficiency judgment unless there is a Guaranteed Recourse Obligation of Borrower (as defined in the Guaranty) for which Guarantor is liable pursuant to the terms of the Guaranty); or (vi) 8) constitute a waiver of the right of Lender to enforce the liability and obligation of Borrower (but not against any members of Borrower (other than Guarantor to the extent provided in the Non-Recourse Guaranty) or their direct or indirect constituent members or partners or any other Person)and/or Operating Lessee, by money judgment or otherwise, to the extent of any loss, damage, cost, expense, liability, claim or other obligation (but excluding any punitive, consequential or speculative damages) Losses incurred by Lender (including attorneys’ fees and costs reasonably incurred) arising out of or in connection with any of the following:
(ai) fraud or intentional material misrepresentation by Borrower, Operating Lessee, any of the Exculpated Parties or any Borrower or Guarantor Party in connection with the Loan;
(bii) intentional physical waste the gross negligence or willful misconduct of Borrower, Operating Lessee, any of the Property (including, but not limited to, waste due to gross negligence) by Borrower Exculpated Parties or any affiliate thereof; provided, however, such physical waste shall exclude wear and tear to Borrower Party in connection with the Property that occurs in the ordinary course of business of the Property by Borrower or any affiliate thereofLoan;
(ciii) the material breach of any representation, warranty, covenant or indemnification provision in the Environmental Indemnity or in this Agreement any other Loan Document concerning Environmental Lawsenvironmental laws, Hazardous Substances hazardous substances and Asbestosasbestos and any indemnification of Lender with respect thereto in any such document;
(div) the intentional misapplication, misappropriation or conversion by Borrower, Operating Lessee, any of the Exculpated Parties or the Borrower Parties of any Rents following an Event of Default, or the removal or disposal by Borrower or any affiliate thereof of any portion of the Property after Property, which removal is not in the ordinary course of business, during the continuance of an Event of Default has occurred and while it is continuing, unless such portion of the Property is replaced by an item of equal or greater value as determined by Lender in its reasonable discretionDefault;
(ev) the misapplication misapplication, misappropriation or conversion by Borrower, Operating Lessee, any of the Exculpated Parties or the Borrower or Parties of any affiliate thereof of (iA) any insurance proceeds paid by reason of any loss, damage or destruction to the Property, or (iiB) any awards Awards or other amounts received in connection with the condemnation Condemnation of all or a portion of the Property, (iii) any Rents following an Event of Default or (iv) any Rents paid more than one (1) month in advance;
(fvi) if any Franchise Agreement or Brand Management Agreement is canceled, terminated or surrendered, expires pursuant to its terms or otherwise ceases to be in full force and effect, and in any such case, Operating Lessee or Borrower, in connection with such cancellation, termination, surrendered, expiration or cessation, fails to enter into a Replacement Franchise Agreement with a Qualified Franchisor or Replacement Brand Management Agreement with a Qualified Brand Manager, in each case, in accordance with the applicable terms and provisions hereof within sixty (60) days of such cancellation, termination, surrender or expiration of the Franchise Agreement or Brand Management Agreement, as applicable;
(vii) Borrower’s failure to make the Condemnation Payment, if required pursuant to Section 5.3.3 hereof;
(viii) Borrower and/or Operating Lessee fail to comply with the provisions of Section 3.1.24 hereof; provided, however, such failure shall not result in recourse liability hereunder unless such breach was material and, within fifteen (15) days of notice from Lender, Borrower fails to cure such breach and fails to deliver to Lender a New Non-Consolidation Opinion to the effect that such failure does not negate or impair the opinion previously delivered to Lender;
(ix) Borrower voluntarily incurs additional secured indebtedness in breach of the Loan Documents without Lender’s prior written consent;
(x) Borrower’s failure to pay any PIP Reserve True-Up;
(xi) (A) failure to pay charges for labor rent, additional rent or materials any other amounts due and payable under the Ground Lease and/or (B) any costs or taxes or other charges that can create liens superior to the lien of the Mortgage on any portion of the Property unless such taxes or other charges are being contested in accordance herewith or such taxes or charges have been delivered to expenses incurred by Lender in accordance connection with Section 3.3 hereof curing any breach or default by Borrower has complied with Section 5.2 hereofunder the Ground Lease; andand/or
(gxii) any security deposits collected by Borrower the Ground Lease is terminated, cancelled or any affiliate thereof with respect otherwise ceases to the Property which are not delivered to Lender upon a foreclosure of the Property or action in lieu thereof, except to the extent any such security deposits were applied in accordance with the terms and conditions of any of the Leases prior to the occurrence of the Event of Default that gave rise to such foreclosure or action in lieu thereof. exist.
(b) Notwithstanding anything to the contrary in this Agreement, the Note or any of the Loan Documents Documents, (iA) Lender shall not be deemed to have waived any right which Lender may have under Section 506(a), 506(b), 1111(b) or any other provisions of the U.S. Bankruptcy Code to file a claim for the full amount of the Debt or to require that all collateral shall continue to secure all of the Debt owing to Lender in accordance with the Loan Documents, and (iiB) the Debt shall become be fully recourse to Borrower (but not its members (other than Guarantor solely to the extent provided in the Non-Recourse Guaranty) or other direct or indirect constituent members or partners or any other Person) in the event that: (Ai) the first full Monthly Debt Service Payment Amount (as defined in the Note) under the Note is not paid when due; (B) other than in connection with a default under subsection (x) of the definition of Special Purpose Bankruptcy Remote Entity set forth in Schedule 5 hereto, Borrower fails to maintain its status as a Special Purpose Bankruptcy Remote Entity in accordance comply with the provisions of this Agreement Section 4.2.1 hereof or Article 8 hereof, except any transfer of all or any portion of the Property to Lender or to any purchaser at a foreclosure sale or a deed in lieu of foreclosure in connection with the exercise of Lender’s rights and remedies under the Loan Documents; (ii) Borrower, SPC Party and/or Operating Lessee fail to comply with any provision of Section 3.1.24 hereof and such failure results in the substantive consolidation of Borrower and/or Operating Lessee with another any other Person; (Ciii) except as otherwise permitted pursuant to Borrower, Operating Lessee, or any SPC Party files a voluntary petition under the Loan Documents, Borrower fails to obtain Lender’s prior written consent to Bankruptcy code or any subordinate financing other Federal or other voluntary lien encumbering the Propertystate bankruptcy or insolvency law; (Div) except as otherwise permitted pursuant to the Loan Documentsan Affiliate, Borrower fails to obtain Lender’s prior written consent to any assignmentofficer, transferdirector, or conveyance of the Property representative which Controls, directly or indirectly, Borrower, Operating Lessee or any interest therein as and to SPC Party, files, or joins in the extent required by this Agreement filing of, an involuntary petition against Borrower, Operating Lessee or any SPC Party under the Mortgage; Bankruptcy Code or (E) (1) if any petition for bankruptcy, reorganization other Federal or arrangement pursuant to federal state bankruptcy or insolvency law, or solicits or causes to be solicited petitioning creditors for any similar federal involuntary petition against Borrower, Operating Lessee or state lawany SPC Party from any Person; (v) Borrower, shall be filed by Borrower Operating Lessee or Guarantor, or (2) if Borrower or Guarantor any SPC Party files an answer consenting to, to or otherwise acquiescing in or joining in, in any involuntary petition for bankruptcyfiled against it, reorganization by any other Person under the Bankruptcy Code or arrangement pursuant to federal any other Federal or state bankruptcy or insolvency law, or solicits or causes to be solicited petitioning creditors for any similar involuntary petition from any Person; (vi) any Affiliate, officer, director, or representative which Controls Borrower, Operating Lessee or any SPC Party consents to or acquiesces in or joins in an application for the appointment of a custodian, receiver, trustee, or examiner for Borrower, Operating Lessee or any SPC Party or any portion of the Property, unless such consent is given in response to a request from Lender; (vii) Borrower, Operating Lessee or any SPC Party makes an assignment for the benefit of creditors, or admits, in writing or in any legal proceeding, its insolvency or inability to pay its debts as they become due; (viii) there is substantive consolidation of Borrower (or any Restricted Party) with any other Person in connection with any federal or state law filed against it by any other Person, or is found pursuant to a final, unappealable order of a court of competent jurisdiction to have solicited or caused to be solicited creditors to file any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, proceeding involving the Guarantor or any similar of its Affiliates, (ix) Borrower (or any Restricted Party) contests or opposes any motion made by Lender to obtain relief from the automatic stay or seeks to reinstate the automatic stay in the event of any federal or state law against bankruptcy or insolvency proceeding involving the Guarantor or its Affiliates; or (x) Borrower (or Guarantorany Restricted Party) accepts from any Guarantor or Guarantor solicits or provides any debtor-in-possession financing to Borrower in the event Borrower (or any Restricted Party) is the subject of a bankruptcy or insolvency proceeding. The obligations and liabilities of Borrower and Operating Lessee, as applicable, under this Section 11.22 shall fully survive indefinitely notwithstanding any termination, satisfaction, assignment, entry of a judgment of foreclosure, exercise of any power of sale, or delivery of a deed in lieu of foreclosure of the Security Instrument; provided, however, notwithstanding the foregoing or anything herein, in the Guaranty, the Environmental Indemnity or the other Loan Documents to the contrary, (3A) if Borrower and Guarantor shall have no liability under this Section 11.22, the Guaranty or Guarantor are found, the Environmental Indemnity to the extent such liability solely arises (i) following appointment of a receiver over the Individual Property or following Lender (or its nominee) taking title to the Property pursuant to a final unappealable order its exercise of a court remedies under the Loan Documents by foreclosure, deed-in-lieu of competent jurisdictionforeclosure, to have been in collusion with creditors that initiate a bankruptcy action assignment-in-lieu of foreclosure or proceeding against Borrower or Guarantor otherwise or (Fii) an Event as a result of Default described in Section 8.1(sLender’s gross negligence, fraud or willful misconduct; and (B) hereof Guarantor shall have occurredno liability under this Section 11.22, the Guaranty or the Environmental Indemnity to the extent such liability solely arises following a Permitted Equity Transfer which results in any such Guarantor no longer owning any direct or indirect interest in Borrower.
Appears in 1 contract
Exculpation. (a) Subject to the qualifications below, Mezzanine Lender shall not enforce the liability and obligation of Borrower or its constituent members, partners, shareholders, directors, employees or agents or the direct or indirect constituent members, partners, shareholders, directors, employees or agents thereof (collectively, the “Borrower Parties”) or any other Person, Borrowers to perform and observe the obligations Obligations contained in the Mezzanine Notes, this Agreement, the Note Pledges or any of the other Mezzanine Loan Documents by any action or proceeding wherein a money judgment shall be sought against Borrowers (or any of the Borrower Parties them) or any other Persontheir members or managers, except that Mezzanine Lender may bring a foreclosure action, an action for specific performance or any other appropriate action or proceeding to enable Mezzanine Lender to enforce and realize upon its interest under the PropertyMezzanine Notes, this Agreement, the Rents Pledges and the other Mezzanine Loan Documents, or in the Collateral or any other collateral given to Mezzanine Lender pursuant to this Agreement and the other Mezzanine Loan Documents; providedPROVIDED, howeverHOWEVER, that, except as specifically provided herein, any judgment in any such action or proceeding shall be enforceable against the Borrower Parties Borrowers only to the extent of their each Borrower's respective interest in the Property, the Rents Collateral and in any other collateral given to Mezzanine Lender, and Mezzanine Lender, by accepting the Mezzanine Notes, this Agreement, the Note Pledges and the other Mezzanine Loan Documents, agrees that it shall not sxx xxx for, seek or demand any deficiency judgment against Borrowers (or any of the Borrower Parties them) or any other Person their members or managers in any such action or proceeding under or by reason of or under or in connection with the Mezzanine Notes, this Agreement, the Note Pledges or any of the other Mezzanine Loan Documents. The provisions of this paragraph Section shall not, however, (ia) constitute a waiver, release or impairment of any obligation evidenced or secured by this Agreement, the Note or any of the other Mezzanine Loan Documents; (iib) impair the right of Mezzanine Lender to name Borrowers (or any of the Borrower Parties, them) as a party defendant in any action or suit for foreclosure and sale under the MortgagePledges or the other Mezzanine Loan Documents; (iiic) affect the validity or enforceability of any of the Mezzanine Loan Documents or any guaranty made in 398 connection with the Mezzanine Loan or any of the rights and remedies of Mezzanine Lender thereunder; (ivd) impair the right of Mezzanine Lender to obtain the appointment of a receiver; (ve) impair constitute a prohibition against Mezzanine Lender to seek a deficiency judgment against Borrowers (or any of them) in order to fully realize the enforcement of security granted by the Assignment of Leases and RentsPledges or to commence any other appropriate action or proceeding in order for Mezzanine Lender to exercise its remedies against the Collateral; or (vif) constitute a waiver of the right of Mezzanine Lender to enforce the liability and obligation of Borrower Borrowers (but not against any members of Borrower (other than Guarantor to the extent provided in the Non-Recourse Guaranty) or their direct or indirect constituent members or partners or any other Personof them), by money judgment or otherwise, to the extent of any loss, damage, cost, expense, liability, claim or other obligation (but excluding any punitive, consequential or speculative damages) actually incurred by Mezzanine Lender (which shall be exclusive of any cancellation rights) (including attorneys’ ' fees and costs reasonably incurred) arising out of or in connection with the following:
(ai) fraud or intentional material misrepresentation of a material fact by Borrower or Guarantor on behalf of Borrowers (or any of them) or either or both Guarantors or any of their respective agents or representatives in connection with the Mezzanine Loan, including by reason of any claim under the Racketeer Influenced and Corrupt Organizations Act ("RICO");
(ii) the gross negligence or willful misconduct by or on behalf of Borrowers, Owners (or any of them) or either or both Guarantors or any of their respective agents or representatives in connection with the Mezzanine Loan;
(b) intentional physical waste of the Property (including, but not limited to, waste due to gross negligence) by Borrower or any affiliate thereof; provided, however, such physical waste shall exclude wear and tear to the Property that occurs in the ordinary course of business of the Property by Borrower or any affiliate thereof;
(ciii) the material breach by any Borrower of any representation, warranty, covenant or indemnification provision in the Environmental Indemnity or in this Agreement any other Mezzanine Loan Document concerning Environmental Lawsenvironmental laws, Hazardous Substances hazardous substances and/or asbestos and Asbestosany indemnification of Mezzanine Lender with respect thereto in either document;
(div) the wrongful removal or disposal by Borrower or any affiliate thereof willful destruction of any portion of the Property Properties after an Event of Default has occurred and while it is continuing, unless such portion of the Property is replaced by an item of equal or greater value as determined by Lender in its reasonable discretionDefault;
(ev) any intentional, physical waste of any Individual Property resulting from the action or inaction of Borrowers, Owners (or any of them) or Manager which materially adversely affects the value of such Individual Property;
(vi) any Legal Requirement (including RICO) resulting in the forfeiture by Borrowers, Owners (or any of them) of any Individual Property, or any material portion thereof, because of the conduct or purported conduct of criminal activity by Borrowers, Owners (or any of them) or either or both Guarantors or any of their respective agents or representatives in connection therewith;
(vii) any material misrepresentation, miscertification or breach of warranty by any Borrower with respect to any representation, warranty or certification contained in this Agreement or any other Mezzanine Loan Document or in any document executed in connection therewith, pursuant to any of the Mezzanine Loan Documents or otherwise to induce Mezzanine Lender to make the Mezzanine Loan, or any advance thereof, or to release monies from any account held by Mezzanine Lender (including any reserve or escrow) or to take other action with respect to any of the Collateral for the Mezzanine Loan; 399
(viii) the misapplication or conversion by Borrower or on behalf of Borrowers, Owners (or any affiliate thereof of them) of (iA) any insurance proceeds paid by reason of any loss, damage or destruction to the any Individual Property, (iiB) any awards Awards or other amounts received in connection with the condemnation Condemnation of all or a portion of the any Individual Property, or (iiiC) any Rents following an Event of Default Gross Revenues (including Rents, security deposits, advance deposits or (iv) any Rents paid more than one (1) month in advanceother deposits and Lease Termination Payments);
(fix) failure to pay charges for labor or materials or taxes or other charges that can create liens superior to the lien of the Mortgage Liens on any portion of any Individual Property, to the Property unless extent such taxes Liens are not bonded over or other charges are being contested in accordance herewith or such taxes or charges have been delivered to Lender discharged in accordance with Section 3.3 hereof or Borrower has complied with Section 5.2 hereof; andSECTION 3.6 of the Mortgages;
(gx) any security deposits, advance deposits or any other deposits collected by Borrower or any affiliate thereof with respect to the any Individual Property which are not delivered to Mezzanine Lender upon a foreclosure of the Property or action in lieu thereof, except to the extent any such security deposits were applied in accordance with the terms provisions of the Mezzanine Loan Documents;
(xi) the failure to pay Taxes with respect to any Individual Property if such Individual Property generates sufficient Gross Revenue to pay such Taxes;
(xii) failure to obtain and conditions maintain the fully paid for Policies in accordance with SECTION 5.1.1 hereof;
(xiii) the failure of any or all of the Leases prior Borrowers to the occurrence cause Owners to permit on-site inspections of any or all of the Event Properties as required by SECTION 4.1.5 hereof or to provide financial information as required by SECTION 4.1.7 hereof; and/or
(xiv) Borrowers' indemnification of Default that gave rise to such foreclosure or action Mezzanine Lender set forth in lieu thereofSECTION 9.2 hereof. Notwithstanding anything to the contrary in this Agreement or any of the other Mezzanine Loan Documents Documents, (iA) Mezzanine Lender shall not be deemed to have waived any right which Mezzanine Lender may have under Section SECTION 506(a), 506(b), 1111(b) or any other provisions of the U.S. Bankruptcy Code to file a claim for the full amount of the Debt Obligations or to require that all collateral shall continue to secure all of the Debt Obligations owing to Mezzanine Lender in accordance with the Mezzanine Loan Documents, and (iiB) the Debt Obligations shall become be fully recourse to Borrower (but not its members (other than Guarantor solely to the extent provided in the Non-Recourse Guaranty) or other direct or indirect constituent members or partners or any other Person) Borrowers in the event that: (Ai) the first full Monthly Debt Service Payment Amount (as defined in the Note) under the Note is not paid when due; (B) other than in connection with a default under subsection (x) any or all of the definition Borrowers fail to maintain its/their status as a single purpose entity or fail to appoint a new property manager upon the request of Special Purpose Bankruptcy Remote Entity Mezzanine Lender after the occurrence of any of the events set forth in Schedule 5 heretoSECTION 7.3, Borrower fails to maintain its status each as a Special Purpose Bankruptcy Remote Entity required by, and in accordance with the terms and provisions of of, this Agreement and such failure results in the substantive consolidation of Borrower with another PersonPledges; (Cii) except as otherwise permitted pursuant to any or all of the Loan Documents, Borrower fails Borrowers fail to obtain Mezzanine Lender’s 's prior written consent to any subordinate financing or other voluntary lien Lien encumbering any Individual Property or the PropertyCollateral; (Diii) except as otherwise permitted pursuant to any or all of the Loan Documents, Borrower fails Borrowers fail to obtain Mezzanine Lender’s 's prior written consent to any assignment, transfer, Transfer of any Individual Property or conveyance of the Property Collateral or any interest therein or any Transfer of any direct or indirect interest in Borrowers (or any of them), in either case as and to the extent required by the Pledges or this Agreement other than a Permitted Transfer; (iv) Borrowers (or any of them) file a voluntary petition under the MortgageBankruptcy Code or any other Federal or state bankruptcy or insolvency law; (v) an Affiliate, officer, director or 400 representative which controls, directly or indirectly, any Borrower files, or joins in the filing of, an involuntary petition against Borrowers (Eor any of them) (1) if under the Bankruptcy Code or any petition for bankruptcy, reorganization other Federal or arrangement pursuant to federal state bankruptcy or insolvency law, or solicits or causes to be solicited petitioning creditors for any similar federal involuntary petition against Borrowers (or state law, shall be filed by Borrower any of them) from any Person; (vi) Borrowers (or Guarantor, or (2any of them) if Borrower or Guarantor files file an answer consenting to, or otherwise acquiescing in, or joining in, any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law filed against it by any other PersonPerson under the Bankruptcy Code or any other Federal or state bankruptcy or insolvency law, or is found pursuant to a final, unappealable order of a court of competent jurisdiction to have solicited solicits or caused causes to be solicited petitioning creditors to file for any involuntary petition for bankruptcyfrom any Person; (vii) any Affiliate, reorganization officer, director or arrangement pursuant to federal bankruptcy lawrepresentative which controls Borrowers (or any of them) consent to, or any similar federal or state law against Borrower or Guarantoracquiesces in, or joins in, an application for the appointment of a custodian, receiver, trustee or examiner for Borrowers (3or any of them) or any portion of any Individual Property or the Collateral; (viii) Borrowers (or any of them) make an assignment for the benefit of creditors or admit, in writing or in any legal proceeding, its insolvency or inability to pay its/their debts as they become due; or (ix) if Borrower either or Guarantor are foundboth Guarantors (or any Person comprising either or both Guarantors), pursuant to Borrowers (or any of them) or any Affiliate of any of the foregoing, in connection with any enforcement action or exercise or assertion of any right or remedy by or on behalf of Mezzanine Lender or performance of the obligations in question without incurring recourse hereunder.under or in connection with the Guaranty, the Mezzanine Notes, the Pledges or any other Mezzanine Loan Document, seeks a final unappealable order defense, judicial intervention or injunctive or other equitable relief of any kind, or asserts in a pleading filed in connection with a judicial proceeding any defense against Mezzanine Lender or any right in connection with any security for the Mezzanine Loan, which the court of competent jurisdiction, to have been in collusion with creditors that initiate a bankruptcy any such action or proceeding against Borrower determines is without merit (in the case of a defense) or Guarantor is unwarranted (in the case of a request for judicial intervention or (F) an Event injunctive or other equitable relief); PROVIDED, HOWEVER, that Borrowers shall be entitled to assert a good faith defense of Default described in Section 8.1(s) hereof shall have occurred.payment
Appears in 1 contract
Samples: Mezzanine Loan Agreement (Horizon Group Properties Inc)
Exculpation. (a) Subject to the qualifications below, no recourse shall be had against, Lender shall not enforce the liability and obligation of Borrower or its constituent members, partners, shareholders, directors, employees or agents or the direct or indirect constituent members, partners, shareholders, directors, employees or agents thereof (collectively, the “Borrower Parties”) or any other Person, to perform and observe the obligations contained in the Note, this Agreement, the Note Pledge Agreement or any of the other Loan Documents by any action or proceeding wherein a money judgment or any deficiency judgment or other judgment establishing personal liability shall be sought against against, any Borrower Party or any direct or indirect principal, director, officer, employee, manager, beneficiary, parent, beneficial owner, shareholder, partner, member, trustee, agent, or Affiliate of any Borrower Party or any direct or indirect legal representatives, successors or assigns of any of the Borrower Parties or any other Personforegoing (collectively, the “Exculpated Parties”), except that Lender Lender, may bring a foreclosure action, an action for specific performance or any other appropriate action or proceeding to enforce the Note, this Agreement, the Pledge Agreement and the other Loan Documents, or to enable Lender to enforce and realize upon Lender’s interest in the Property, the Rents Collateral or any other collateral given to Lender pursuant to this Agreement and the other Loan Documents; provided, however, that, except as specifically provided herein, any judgment in any such action or proceeding shall be enforceable against the Borrower Parties only to the extent of their Borrower’s interest in the Property, the Rents Collateral and in any other collateral given to Lender, and Lender, by accepting the Note, this Agreement, the Note Pledge Agreement and the other Loan Documents, agrees that it shall not sxx xxx for, seek or demand any deficiency judgment with respect to the Loan against Borrower or any of the Borrower Exculpated Parties or any other Person in any such action or proceeding under or by reason of or under or in connection with the Note, this Agreement, the Note or any of Pledge Agreement, the other Loan DocumentsDocuments or otherwise. The provisions of this paragraph Section shall not, however, (i1) constitute a waiver, release or impairment of any obligation evidenced or secured by this Agreement, the Note or any of the other Loan Documents; (ii2) impair the right of Lender to name any of the Borrower Parties, as a party defendant in any action or suit for foreclosure, exercise of any power of sale, or an assignment in lieu of foreclosure and sale under upon the MortgageCollateral or exercise of remedies pursuant to the Pledge Agreement; (iii3) affect the validity or enforceability of any Loan Document or any guaranty in connection with the Loan (including, without limitation, the indemnities set forth in Article 12 hereof, the Guaranty and the Environmental Indemnity) made in connection with the Loan or any of the rights and remedies of Lender thereunder; (iv4) intentionally omitted, (5) impair the right of Lender to (A) obtain the appointment of a receiverreceiver and/or (B) enforce its rights and remedies provided in Articles 8 and 9 hereof; (v6) impair the enforcement of Pledge Agreement or any other Loan Documents; (7) constitute a prohibition against Lender, to seek a deficiency judgment against Borrower in order to fully realize the Assignment of Leases and Rentssecurity granted by the Pledge Agreement or to commence any other appropriate action or proceeding in order for Lender to exercise Lender’s remedies against the Property or any portion thereof; or (vi) 8) constitute a waiver of the right of Lender to enforce the liability and obligation of Borrower (but not against any members of Borrower (other than Guarantor to the extent provided in the Non-Recourse Guaranty) or their direct or indirect constituent members or partners or any other Person)Borrower, by money judgment or otherwise, to the extent of any loss, damage, cost, expense, liability, claim or other obligation (but excluding any punitive, consequential or speculative damages) actual Losses incurred by Lender (including actual out-of-pocket attorneys’ fees and costs reasonably incurred) arising out of or in connection with the following:
(ai) fraud or intentional misrepresentation by any Borrower or Guarantor Party in connection with the Loan;
(bii) the willful misconduct of any Borrower Party in connection with the Loan;
(iii) any litigation or other legal proceeding (including, the raising of defenses) related to the Debt filed or raised by any Borrower Party that delays, opposes, impedes, obstructs, hinders, enjoins or otherwise interferes with or frustrates the efforts of Lender to exercise any rights and remedies available to Lender as provided herein and in the other Loan Documents which is found by a court of competent jurisdiction to be without merit or brought or raised, as applicable, in bad faith;
(iv) intentional physical waste of the Property (including, but not limited to, waste due to gross negligence) by Borrower or any affiliate thereof; provided, however, such physical waste shall exclude wear and tear to the Property that occurs in the ordinary course of business violation of the Property by Borrower or any affiliate thereof;
(c) the material breach terms of any representation, warranty, covenant or indemnification provision in the Environmental Indemnity or in this Agreement concerning Environmental Laws, Hazardous Substances and Asbestos;
(d) caused by any Borrower Party and/or the removal or disposal by Borrower or any affiliate thereof of any portion of the Property after in violation of the terms of this Agreement during the continuance of an Event of Default has occurred and while it is continuing, unless such portion of the Property is replaced by an item of equal or greater value as determined by Lender in its reasonable discretionDefault;
(ev) the misapplication misappropriation or conversion by any Borrower or any affiliate thereof Party, in contravention of the Loan Documents, of (iA) any insurance proceeds paid by reason of any loss, damage or destruction to the Property, (iiB) any awards Awards or other amounts received in connection with the condemnation Condemnation of all or a portion of the Property, (iiiC) any Rents following an Event of Default Rents, or (ivD) any Security Deposits or Rents paid more than one (1) month collected in advance;
(fvi) failure to the extent there exists sufficient cash flow from the Property to pay Taxes or charges for labor or materials or taxes or other charges that can create liens superior to the lien of the Mortgage on any portion of the Property Property, Borrower’s failure to pay or cause Mortgage Borrower to pay such Taxes or charges (except to the extent (A) sums sufficient to pay such Taxes or charges have been deposited with Mortgage Lender in accordance with the terms of the Mortgage Loan Agreement or (B) such cash flow is not being made available to Borrower by Mortgage Lender as a result of Mortgage Lender’s exercise of its remedies under the Mortgage Loan Documents) unless such taxes Taxes or other charges are being contested as permitted hereunder or under the Mortgage Loan Agreement;
(vii) to the extent there exists sufficient cash flow from the Property to pay Insurance Premiums and/or to maintain the Policies in accordance herewith full force and effect, Borrower’s failure to pay or cause Mortgage Borrower to pay such taxes or charges Insurance Premiums and/or to maintain the Policies in full force and effect, in each case, as expressly provided herein (except to the (A) extent sums sufficient to pay such Insurance Premiums and/or to maintain the Policies have been delivered to deposited with Mortgage Lender in accordance with Section 3.3 hereof the terms of the Mortgage Loan Agreement or (B) such cash flow is not being made available to Borrower has complied with Section 5.2 hereof; andby Mortgage Lender as a result of Mortgage Lender’s exercise of its remedies under the Mortgage Loan Documents);
(gviii) any security deposits collected by Borrower or any affiliate thereof with respect to the Property Security Deposits which are not delivered to Lender upon by a Borrower Party following a foreclosure of the Property or action in lieu thereof, except to the extent any such security deposits Security Deposits were (a) delivered to Mortgage Lender in accordance with the Mortgage Loan Documents or (b) applied in accordance with the terms and conditions of any of the applicable Leases prior to the occurrence of an Event of Default;
(ix) if as a result of the actions or inactions of Borrower or its Affiliates or Mortgage Borrower or its Affiliates (including, without limitation, Mortgage Borrower failing to comply with the terms of such Property Document) any Property Document is (A) materially modified in a manner adverse to Lender or Mortgage Borrower, (B) terminated, (C) cancelled or (D) otherwise ceases to exist, except in each of the foregoing cases, if such action or inaction of Borrower or its Affiliates or Mortgage Borrower or its Affiliates is permitted pursuant to the terms of this Agreement and/or Lender has approved the same;
(x) any representation, warranty or covenant contained in Article 5 hereof is violated or breached; provided, however, that solely with respect to a breach of Section 5.1(a)(vii) that arise from Borrower’s or Mortgage Borrower’s failure to pay trade and operational indebtedness, such breach shall not result in recourse under the Loan pursuant to this clause (x), if cash flow from the Property available to Borrower and/or Mortgage Borrower is not sufficient to pay such amounts;
(xi) except as set forth in Section 13.1(b) below, (A) Borrower fails to obtain Lender’s prior consent to any Prohibited Transfer as required by this Agreement (other than a Permitted Transfer) or (B) any covenant contained in Section 6.6 hereof is violated or breached;
(xii) any distributions to Borrower’s direct or indirect legal or beneficial owners after the occurrence and during the continuance of an Event of Default;
(xiii) any liabilities and obligations of Borrower or Mortgage Borrower: (i) accrued or accruing on or prior to any acquisition of title to the Collateral pursuant to a UCC foreclosure sale, a UCC strict foreclosure, an assignment in lieu of foreclosure or other enforcement action under the Loan Documents (collectively, an “Equity Collateral Enforcement Action”; and the date on which an Equity Collateral Enforcement Action is consummated, an “Equity Collateral Transfer Date”) with respect to indemnification obligations accrued or accruing in favor of Borrower, Mortgage Borrower or any Affiliate of Borrower and/or Mortgage Borrower (individually and collectively, a “Borrower Control Party”) under any organizational documents of any Borrower Control Party or any other agreement that was not either approved by Lender or entered into in compliance with this Agreement; (ii) without duplications of amounts paid or payable pursuant to Section 13.1(a)(iii) above, accrued or accruing prior to, on or after the Equity Collateral Transfer Date to pay legal fees to legal counsel engaged by any Borrower Control Party prior to the Equity Collateral Transfer Date if such legal fees were incurred to defend against an enforcement action under the Loan Documents; or (iii) accrued or accruing prior to, on or after the Equity Collateral Transfer Date under any agreement (a “Third Party Agreement”) between any Borrower Control Party, on the one hand, and any Person not Affiliated with Mortgage Borrower, on the other hand, that has been entered into during the continuance of an Event of Default that gave rise without the prior written approval of Lender to the extent such foreclosure prior written approval was required under the Loan Documents (unless such Third Party Agreement has been assumed in writing by the Person acquiring the Collateral on or after the Equity Collateral Transfer Date);
(xiv) Mortgage Borrower “opts out” of Article 8 of the UCC;
(xv) Borrower or any Borrower Party acquires all or any portion of any interest in the Mortgage Loan in violation of Section 4.33(a) hereof and votes or approves the undertaking of any enforcement action under the Mortgage Loan; and/or
(xvi) Mortgage Borrower gives notice of termination of the Restricted Account Agreement other than in lieu thereof. accordance with Section 8(d) of the Restricted Account Agreement in effect as of the Closing Date and the Restricted Account Agreement is terminated by Bank as a result of such notice.
(b) Notwithstanding anything to the contrary in this Agreement, the Note or any of the Loan Documents Documents, (iA) Lender shall not be deemed to have waived any right which Lender may have under Section 506(a), 506(b), 1111(b) or any other provisions of the U.S. Bankruptcy Code to file a claim for the full amount of the Debt or to require that all collateral shall continue to secure all of the Debt owing to Lender in accordance with the Loan Documents, and (iiB) the Debt shall become be fully recourse to Borrower (but not its members (other than Guarantor solely to the extent provided in the Non-Recourse Guaranty) or other direct or indirect constituent members or partners or any other Person) in the event that: :
(i) a Bankruptcy Event occurs;
(ii) any voluntary Sale or Pledge of the Property (other than (i) an easement (except for an easement affecting the Property that interferes or impairs in a material way Borrower’s ability to use and operate the Property as currently used or that otherwise has a Material Adverse Effect), (ii) a covenant or restriction that (A) does not interfere with or impair in a material way Borrower’s ability to use and operate the first full Monthly Debt Service Payment Amount (Property as defined in the Note) under the Note is not paid when due; currently used and (B) other than does not have a Material Adverse Effect, and (iii) a Lease entered - 120 - into at the Property (except for a lease of all or a majority of the Property, a ground lease, or a master lease)), the Collateral or any direct or indirect interest in connection Borrower, Mortgage Borrower or Guarantor that results in a failure to comply with a default under subsection the Minimum Ownership/Control Test, in each case in violation of the terms of this Agreement (but excluding (x) any failure to comply with the requirements in any of clause (A), (D), (E), (G) or (H) appearing in the definition of Special Purpose Bankruptcy Remote Entity set forth “Permitted Transfer” in Schedule 5 hereto, Borrower fails to maintain its status as a Special Purpose Bankruptcy Remote Entity in accordance with the provisions Section 6.3 of this Agreement and such (y) any violation as a result of a failure results in of a Mezzanine Lender to comply with the substantive consolidation of Borrower with another Person; Intercreditor Agreement);
(Ciii) except as otherwise permitted pursuant to the Loan Documents, if Borrower fails to obtain Lender’s prior written consent (if and to the extent required under the Loan Documents) to (A) any subordinate financing or other voluntary lien liens encumbering the Property; Property that are not considered Permitted Encumbrances hereunder or (DB) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any assignment, transfer, subordinate financing or conveyance other voluntary liens encumbering: (1) a direct interest in any subsidiary of the Property or any interest therein as and Guarantor to the extent required by this Agreement such subsidiary owns a direct or the Mortgageindirect interest in Borrower; or (E) (1) if any petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law, shall be filed by Borrower or Guarantor, or (2) a direct or indirect interest in Borrower if foreclosed upon would result in the Minimum Ownership/Control Test not being met; and/or
(iv) if any representation, warranty or covenant contained in Article 5 hereof is violated or breached and such violation or breach results in the substantive consolidation of the assets and liabilities of Borrower or Guarantor files an answer consenting to, or otherwise joining in, any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law filed against it by Mortgage Borrower with the assets and liabilities of any other Person, or is found pursuant to a final, unappealable order of a court of competent jurisdiction to have solicited or caused to be solicited creditors to file any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law against Borrower or Guarantor, or (3) if Borrower or Guarantor are found, pursuant to a final unappealable order of a court of competent jurisdiction, to have been in collusion with creditors that initiate a bankruptcy action or proceeding against Borrower or Guarantor or (F) an Event of Default described in Section 8.1(s) hereof shall have occurred.
Appears in 1 contract
Samples: Mezzanine Loan Agreement (Brookfield DTLA Fund Office Trust Investor Inc.)
Exculpation. Subject The liability of Landlord or the other Landlord Parties to Tenant (or any person or entity claiming by, through or under Tenant) for any default by Landlord under this Lease or arising in connection herewith or with Landlord’s operation, management, leasing, repair, renovation, alteration or any other matter relating to the qualifications below, Lender Project or the Premises shall be limited solely and exclusively to an amount which is equal to the equity interest of Landlord in the Building. The Landlord Parties shall not enforce have any personal liability therefor, and Tenant hereby expressly waives and releases such personal liability on behalf of itself and all persons claiming by, through or under Tenant. The limitations of liability contained in this Section 29.13 shall inure to the liability benefit of the Landlord Parties’ present and obligation of Borrower or its constituent membersfuture partners, partnersbeneficiaries, officers, directors, trustees, shareholders, directorsagents and employees, employees or agents or the direct or indirect constituent members, and their respective partners, shareholdersheirs, directorssuccessors and assigns. Under no circumstances shall any present or future partner, employees member, shareholder, trustee or agents thereof (collectivelybeneficiary of Landlord, have any liability for the performance of Landlord’s obligations under this Lease. Neither party shall be liable to the other party for any special or consequential damages, loss of profits, loss of business opportunity or loss of goodwill from the failure of such party to meet its obligations under this Lease. Notwithstanding the limitation contained in the foregoing sentence, the “Borrower Parties”parties acknowledge and agree that (i) if Landlord is required to xxxxx the rent of another tenant at the Project, as the result of any Alteration constructed by or any other Personon behalf of Tenant, to perform and observe the obligations contained in this Agreement, the Note or any of the other Loan Documents by any action or proceeding wherein a money judgment shall be sought against any of the Borrower Parties or any other Person, except that Lender may bring a foreclosure action, an action for specific performance or any other appropriate action or proceeding to enable Lender to enforce and realize upon the Property, the Rents or any other collateral given to Lender pursuant to this Agreement and the other Loan Documents; provided, however, that, except as specifically provided herein, any judgment in any such action or proceeding shall be enforceable against the Borrower Parties only to the extent of their interest in the Property, the Rents and in any other collateral given to Lender, and Lender, by accepting this Agreement, the Note and the other Loan Documents, agrees that it shall not sxx for, seek or demand any deficiency judgment against any of the Borrower Parties or any other Person in any such action or proceeding under or by reason of or in connection with this Agreementany repair or maintenance performed by or on behalf of Tenant, the Note or any as a result of the other Loan Documents. The provisions Tenant’s negligence or breach of this paragraph Lease, which interferes with such tenant’s use of its premises Tenant shall not, however, (i) constitute a waiver, release or impairment of any obligation evidenced or secured by this Agreement, the Note or any of the other Loan Documents; (ii) impair the right of Lender be liable to name any of the Borrower Parties, as a party defendant in any action or suit Landlord for foreclosure and sale under the Mortgage; (iii) affect the validity or enforceability of any guaranty made in connection with the Loan or any rights and remedies of Lender thereunder; (iv) impair the right of Lender to obtain the appointment of a receiver; (v) impair the enforcement of the Assignment of Leases and Rents; or (vi) constitute a waiver of the right of Lender to enforce the liability and obligation of Borrower (but not against any members of Borrower (other than Guarantor to the extent provided in the Non-Recourse Guaranty) or their direct or indirect constituent members or partners or any other Person), by money judgment or otherwise, to the extent of any loss, damage, cost, expense, liability, claim or other obligation (but excluding any punitive, consequential or speculative damages) incurred by Lender (including attorneys’ fees and costs reasonably incurred) arising out of or in connection with the following:
(a) fraud or intentional misrepresentation by Borrower or Guarantor in connection with the Loan;
(b) intentional physical waste of the Property (including, but not limited to, waste due to gross negligence) by Borrower or any affiliate thereof; provided, however, such physical waste shall exclude wear and tear to the Property that occurs in the ordinary course of business of the Property by Borrower or any affiliate thereof;
(c) the material breach of any representation, warranty, covenant or indemnification provision in the Environmental Indemnity or in this Agreement concerning Environmental Laws, Hazardous Substances and Asbestos;
(d) the removal or disposal by Borrower or any affiliate thereof of any portion of the Property after an Event of Default has occurred and while it is continuing, unless such portion of the Property is replaced by an item of equal or greater value as determined by Lender in its reasonable discretion;
(e) the misapplication or conversion by Borrower or any affiliate thereof of (i) any insurance proceeds paid by reason of any loss, damage or destruction to the Property, (ii) any awards or other amounts received in connection with the condemnation of all or a portion of the Property, (iii) any Rents following an Event of Default or (iv) any Rents paid more than one (1) month in advance;
(f) failure to pay charges for labor or materials or taxes or other charges that can create liens superior to the lien of the Mortgage on any portion of the Property unless such taxes or other charges are being contested in accordance herewith or such taxes or charges have been delivered to Lender in accordance with Section 3.3 hereof or Borrower has complied with Section 5.2 hereof; and
(g) any security deposits collected by Borrower or any affiliate thereof with respect to the Property which are not delivered to Lender upon a foreclosure of the Property or action in lieu thereof, except to the extent any such security deposits were applied in accordance with the terms and conditions of any of the Leases prior to the occurrence of the Event of Default that gave rise to such foreclosure or action in lieu thereof. Notwithstanding anything to the contrary in any of the Loan Documents (i) Lender shall not be deemed to have waived any right which Lender may have under Section 506(a), 506(b), 1111(b) or any other provisions of the U.S. Bankruptcy Code to file a claim for the full amount of the Debt or to require that all collateral shall continue to secure all of the Debt owing to Lender in accordance with the Loan Documentsabated rent, and (ii) the Debt Tenant shall become fully recourse to Borrower (but not its members (other than Guarantor solely to the extent provided be liable for any and all claims or damages which Landlord may suffer because of Tenant’s holding over in the Non-Recourse Guaranty) Premises following the expiration of the Lease Term. Nothing in this Section 29.13 shall affect or other direct limit Landlord’s rights to file legal actions to recover possession of the Premises, or indirect constituent members or partners for injunctive relief against Tenant, or any other Person) non-monetary relief provided in the event that: (A) the first full Monthly Debt Service Payment Amount (as defined in the Note) under the Note is not paid when due; (B) other than in connection with a default under subsection (x) of the definition of Special Purpose Bankruptcy Remote Entity set forth in Schedule 5 hereto, Borrower fails to maintain its status as a Special Purpose Bankruptcy Remote Entity in accordance with the provisions of this Agreement and such failure results in the substantive consolidation of Borrower with another Person; (C) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any subordinate financing or other voluntary lien encumbering the Property; (D) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any assignment, transfer, or conveyance of the Property or any interest therein as and to the extent required by this Agreement or the Mortgage; or (E) (1) if any petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law, shall be filed by Borrower or Guarantor, or (2) if Borrower or Guarantor files an answer consenting to, or otherwise joining in, any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law filed against it by any other Person, or is found pursuant to a final, unappealable order of a court of competent jurisdiction to have solicited or caused to be solicited creditors to file any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law against Borrower or Guarantor, or (3) if Borrower or Guarantor are found, pursuant to a final unappealable order of a court of competent jurisdiction, to have been in collusion with creditors that initiate a bankruptcy action or proceeding against Borrower or Guarantor or (F) an Event of Default described in Section 8.1(s) hereof shall have occurredLease.
Appears in 1 contract
Samples: Sublease Agreement (Snowflake Inc.)
Exculpation. Subject to the qualifications below, Lender (i) The Collateral Agent shall not enforce the liability and obligation of Borrower have any duties or its constituent members, partners, shareholders, directors, employees or agents or the direct or indirect constituent members, partners, shareholders, directors, employees or agents thereof (collectively, the “Borrower Parties”) or any other Person, to perform and observe the obligations contained in this Agreement, the Note or any of the other Loan Documents by any action or proceeding wherein a money judgment shall be sought against any of the Borrower Parties or any other Person, except that Lender may bring a foreclosure action, an action for specific performance or any other appropriate action or proceeding to enable Lender to enforce and realize upon the Property, the Rents or any other collateral given to Lender pursuant to this Agreement and the other Loan Documents; provided, however, that, except as specifically provided herein, any judgment in any such action or proceeding shall be enforceable against the Borrower Parties only to the extent of their interest in the Property, the Rents those expressly set forth herein and in any other collateral given to Lender, and Lender, by accepting this Agreement, the Note and the other Loan Documents, agrees that it which shall not sxx for, seek or demand any deficiency judgment against any be ministerial and administrative in nature. Without limiting the generality of the Borrower Parties or any other Person in any such action or proceeding under or by reason of or in connection with this Agreementforegoing, the Note or any of the other Loan Documents. The provisions of this paragraph shall not, however, (i) constitute a waiver, release or impairment of any obligation evidenced or secured by this Agreement, the Note or any of the other Loan Documents; (ii) impair the right of Lender to name any of the Borrower Parties, as a party defendant in any action or suit for foreclosure and sale under the Mortgage; (iii) affect the validity or enforceability of any guaranty made in connection with the Loan or any rights and remedies of Lender thereunder; (iv) impair the right of Lender to obtain the appointment of a receiver; (v) impair the enforcement of the Assignment of Leases and Rents; or (vi) constitute a waiver of the right of Lender to enforce the liability and obligation of Borrower (but not against any members of Borrower (other than Guarantor to the extent provided in the Non-Recourse Guaranty) or their direct or indirect constituent members or partners or any other Person), by money judgment or otherwise, to the extent of any loss, damage, cost, expense, liability, claim or other obligation (but excluding any punitive, consequential or speculative damages) incurred by Lender (including attorneys’ fees and costs reasonably incurred) arising out of or in connection with the followingCollateral Agent:
(aA) fraud shall not be subject to any fiduciary or intentional misrepresentation by Borrower other implied duties, regardless of whether a Default or Guarantor in connection with the Loan;
(b) intentional physical waste of the Property (including, but not limited to, waste due to gross negligence) by Borrower or any affiliate thereof; provided, however, such physical waste shall exclude wear and tear to the Property that occurs in the ordinary course of business of the Property by Borrower or any affiliate thereof;
(c) the material breach of any representation, warranty, covenant or indemnification provision in the Environmental Indemnity or in this Agreement concerning Environmental Laws, Hazardous Substances and Asbestos;
(d) the removal or disposal by Borrower or any affiliate thereof of any portion of the Property after an Event of Default has occurred and while it is continuing; (B) shall not have any duty to take any discretionary action or exercise any discretionary powers, unless such portion except discretionary rights and powers expressly contemplated hereby or by the other Loan Documents that the Collateral Agent is required to exercise or as may otherwise be directed in writing by the Lender; provided that, the Collateral Agent shall not be required to take any action that, in its opinion or the opinion of its 56 HB: 4868-8978-1628.11 counsel, may expose the Collateral Agent to liability or that is contrary to any Loan Document or applicable law, including, for the avoidance of doubt, any Debtor Relief Law applicable to any 57 HB: 4868-8978-1628.11 Borrower; and (C) shall not, except as expressly set forth herein and in the other Loan Documents, have any duty to disclose, and shall not be liable for the failure to disclose, any information relating to the Loan Parties or any of their Affiliates that is communicated to or obtained by the Collateral Agent or any of its Affiliates in any capacity.
(ii) The Collateral Agent shall not be liable for any action taken or not taken by it (A) with the consent or at the request of the Property is replaced by an item Lender, or (B) in the absence of equal its own gross negligence, fraud, or greater value willful misconduct as determined by Lender in its reasonable discretion;a final and non-appealable judgment of a court of competent jurisdiction.
(e) the misapplication or conversion by Borrower or any affiliate thereof of (i) any insurance proceeds paid by reason of any loss, damage or destruction to the Property, (ii) any awards or other amounts received in connection with the condemnation of all or a portion of the Property, (iii) any Rents following an Event of Default or (iv) any Rents paid more than one (1) month in advance;
(f) failure to pay charges for labor or materials or taxes or other charges that can create liens superior to the lien of the Mortgage on any portion of the Property unless such taxes or other charges are being contested in accordance herewith or such taxes or charges have been delivered to Lender in accordance with Section 3.3 hereof or Borrower has complied with Section 5.2 hereof; and
(g) any security deposits collected by Borrower or any affiliate thereof with respect to the Property which are not delivered to Lender upon a foreclosure of the Property or action in lieu thereof, except to the extent any such security deposits were applied in accordance with the terms and conditions of any of the Leases prior to the occurrence of the Event of Default that gave rise to such foreclosure or action in lieu thereof. Notwithstanding anything to the contrary in any of the Loan Documents (i) Lender The Collateral Agent shall not be deemed to have waived knowledge of any right which Lender Default or Event of Default unless and until notice describing such Default or Event of Default is given to the Collateral Agent in writing by any Loan Party or the Lender. In the event that the Collateral Agent receives such notice, the Collateral Agent shall give prompt notice thereof to the Lender. Upon the occurrence of a Default or Event of Default, the Collateral Agent shall take such action with respect to such Default or Event of Default as shall be reasonably directed by the Lender. Unless and until the Collateral Agent shall have received such direction, the Collateral Agent may (but shall not be obligated to) take such action, or refrain from taking such action, with respect to any such Default or Event of Default as it shall deem advisable in the best interest of the Lender. In no event shall the Collateral Agent be required to comply with any such directions to the extent that the Collateral Agent believes that its compliance with such directions would be unlawful.
(iv) The Collateral Agent shall not be responsible for or have under Section 506(a)any duty to ascertain or inquire into (A) any statement, 506(b), 1111(b) warranty or representation made in or in connection with this Agreement or any other provisions Loan Document, (B) the contents of any certificate, report or other document delivered hereunder or thereunder or in connection herewith or therewith, (C) the performance or observance of any of the U.S. Bankruptcy Code to file a claim for covenants, agreements or other terms or conditions set forth herein or therein or the full amount occurrence of the Debt any Default or to require that all collateral shall continue to secure all Event of the Debt owing to Lender in accordance with the Loan DocumentsDefault, and (iiD) the Debt shall become fully recourse to Borrower (but not its members (validity, enforceability, effectiveness or genuineness of this Agreement, any other than Guarantor solely to the extent provided in the Non-Recourse Guaranty) or other direct or indirect constituent members or partners Loan Document or any other Person) in agreement, instrument or document or the event that: (A) creation, perfection or priority of any Lien purported to be created by the first full Monthly Debt Service Payment Amount (as defined in the Note) under the Note is not paid when due; (B) other than in connection with a default under subsection (x) of the definition of Special Purpose Bankruptcy Remote Entity set forth in Schedule 5 hereto, Borrower fails to maintain its status as a Special Purpose Bankruptcy Remote Entity in accordance with the provisions of this Agreement and such failure results in the substantive consolidation of Borrower with another Person; (C) except as otherwise permitted pursuant to the Loan Security Documents, Borrower fails to obtain Lender’s prior written consent to any subordinate financing or other voluntary lien encumbering the Property; (D) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any assignment, transfer, or conveyance of the Property or any interest therein as and to the extent required by this Agreement or the Mortgage; or (E) (1) if the value or the sufficiency of any petition for bankruptcyCollateral, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law, shall be filed by Borrower or Guarantor, or (2) if Borrower or Guarantor files an answer consenting to, or otherwise joining in, any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law filed against it by any other Person, or is found pursuant to a final, unappealable order of a court of competent jurisdiction to have solicited or caused to be solicited creditors to file any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law against Borrower or Guarantor, or (3) if Borrower or Guarantor are found, pursuant to a final unappealable order of a court of competent jurisdiction, to have been in collusion with creditors that initiate a bankruptcy action or proceeding against Borrower or Guarantor or (F) an Event the satisfaction of Default described any condition set forth in Section 8.1(sArticle IV or elsewhere herein, other than to confirm receipt of items expressly required to be delivered to the Collateral Agent.
(v) The Collateral Agent shall not be responsible or liable for or have any duty to ascertain, monitor or enforce, compliance with the provisions hereof relating to Disqualified Institutions. Without limiting the generality of the foregoing, the Collateral Agent shall have occurredno
(A) obligation to ascertain, monitor or inquire whether the Lender or Participant or prospective Lender or Participant is a Disqualified Institution or (B) liability with respect to or arising out of any assignment or participation of Loans, or disclosure of Information, to any Disqualified Institution.
(vi) The Collateral Agent shall have no obligation whatsoever to the Lender to assure that the Collateral exists or is owned by the Borrowers or is cared for, protected or insured or has been encumbered or that the Lien granted to the Collateral Agent pursuant to this 58 HB: 4868-8978-1628.11 Agreement or any other Loan Document has been properly or sufficiently or lawfully created, perfected, protected or enforced or is entitled to any particular priority, or to exercise at all or in any particular 59 HB: 4868-8978-1628.11 manner or under any duty of care, disclosure or fidelity, or to continue exercising, any of the rights, authorities and powers granted or available to the Collateral Agent in any Loan Document, it being understood and agreed that in respect of the Collateral, or any act, omission or event related thereto, the Collateral Agent may act in any manner it may deem appropriate, in its sole discretion.
Appears in 1 contract
Exculpation. Subject to the qualifications below, Lender shall not enforce the liability and obligation of Borrower (or its constituent any of Borrower’s members, managers, partners, shareholders, directorsofficers, employees directors or agents Affiliates, whether director or the direct or indirect constituent membersindirect, partners, shareholders, directors, employees or agents thereof (collectively, the “Borrower Parties”) or any other Person, to perform and observe the obligations contained in the Note, this Agreement, the Note Pledge Agreement or any of the other Loan Documents by any action or proceeding wherein a money judgment shall be sought against any of the Borrower Parties or any other PersonBorrower, except that Lender may bring a foreclosure action, an action for specific performance or any other appropriate action or proceeding to enable Lender to enforce and realize upon its interest under the PropertyNote, this Agreement, the Rents Pledge Agreement and the other Loan Documents, or in the Collateral or any other collateral given to Lender pursuant to this Agreement and the other Loan Documents; provided, however, that, except as specifically provided herein, any judgment in any such action or proceeding shall be enforceable against the Borrower Parties only to the extent of their Borrower’s interest in the Property, the Rents Collateral and in any other collateral given to Lender, and Lender, by accepting the Note, this Agreement, the Note Pledge Agreement and the other Loan Documents, agrees for itself and its successors and assigns that it and its successors and assigns shall not sxx xxx for, seek or demand any deficiency judgment against any of the Borrower Parties or any other Person in any such action or proceeding under under, or by reason of of, or in connection with with, the Note, this Agreement, the Note Pledge Agreement or any of the other Loan Documents. The provisions of this paragraph Section shall not, however, (ia) constitute a waiver, release or impairment of any obligation evidenced or secured by this Agreement, the Note or any of the other Loan Documents; (iib) impair the right of Lender to name any of the Borrower Parties, as a party defendant in any action or suit for foreclosure and sale under the MortgagePledge Agreement; (iiic) affect the validity or enforceability of any guaranty made in connection with the Loan or any of the rights and remedies of Lender thereunder; (ivd) impair the right of Lender to obtain the appointment of a receiver; (ve) impair the enforcement of the Assignment of Leases and RentsPledge Agreement; (f) constitute a prohibition against Lender seeking a deficiency judgment against Borrower in order to fully realize the security granted by the Pledge Agreement or commencing any other appropriate action or proceeding in order for Lender to exercise its remedies against the Collateral; or (vig) constitute a waiver of the right of Lender to enforce the liability and obligation of Borrower (but not against any members under the terms of Borrower (other than Guarantor to the extent provided in the Non-Recourse Guaranty) or their direct or indirect constituent members or partners or any other Person)this Agreement, by money judgment or otherwise, to the extent of any actual out of pocket loss, damage, cost, expense, liability, claim or other obligation (but excluding any punitive, consequential suffered or speculative damages) incurred by Lender (including attorneys’ fees and costs reasonably incurred) arising out of or in connection with the following:
(a1) fraud or intentional material misrepresentation or failure to disclose a material fact by Borrower or Guarantor any of the Borrower Parties in connection with the Loan;
(b2) intentional physical waste the gross negligence or willful misconduct of the Property (including, but not limited to, waste due to gross negligence) by Borrower or any affiliate thereof; provided, however, such physical waste shall exclude wear and tear to the Property that occurs in the ordinary course of business of the Property by Borrower or any affiliate thereofParties;
(c3) the material breach of any representation, warranty, covenant or indemnification provision in this Agreement or the Environmental Indemnity or concerning environmental laws, hazardous substances and asbestos and any indemnification of Lender with respect thereto in this Agreement concerning Environmental Laws, Hazardous Substances and Asbestosany of such documents;
(d4) willful physical waste of the Property to the extent that sufficient cash flow of the Property is available to prevent such waste;
(5) the removal or disposal by Borrower or any affiliate thereof of any portion of the Property after an Event of Default has occurred and while it is continuing, unless such portion of the Property is replaced by an item of equal or greater value as determined by Lender in its reasonable discretionDefault;
(e6) the misapplication misappropriation or conversion by or on behalf of Borrower or any affiliate thereof of (iA) any insurance proceeds Insurance Proceeds paid by reason of any loss, damage loss or destruction to the Propertydamage, (iiB) any awards or other amounts Award received in connection with the a condemnation of all or a portion of the Propertysimilar proceeding, (iiiC) any Rents or other revenues derived from the Property following an Event of Default or (ivD) any Rents paid more than one (1) month in advanceadvance following an Event of Default;
(f7) failure to pay charges for labor or materials or taxes or other charges that can create liens superior to the lien of the Mortgage on any portion of the Property unless such taxes or other charges are being contested in accordance herewith or such taxes or charges have been delivered to Lender in accordance with Section 3.3 hereof or Borrower has complied with Section 5.2 hereof; and
(g) any security deposits collected by if Borrower or any affiliate thereof with respect other entity that is required to the Property which are not delivered be a Single-Purpose Entity fails to Lender upon a foreclosure of the Property or action in lieu thereof, except to the extent any such security deposits were applied in accordance comply with the terms and conditions of any of the Leases prior to the occurrence of the Event of Default that gave rise to such foreclosure SPE Covenants or action in lieu thereof. Notwithstanding anything to the contrary in any of the Loan Documents (i) Lender shall not be deemed to have waived any right which Lender may have under Section 506(a), 506(b), 1111(b) or any other provisions of the U.S. Bankruptcy Code to file a claim for the full amount of the Debt or to require that all collateral shall continue to secure all of the Debt owing to Lender in accordance with the Loan Documents, and (ii) the Debt shall become fully recourse to Borrower (but not its members (other than Guarantor solely to the extent provided in the Non-Recourse Guaranty) or other direct or indirect constituent members or partners or any other Person) in the event that: (A) the first full Monthly Debt Service Payment Amount (as defined in the Note) under the Note is not paid when due; (B) other than in connection with a default under subsection (x) of the definition of Special Purpose Bankruptcy Remote Entity set forth in Schedule 5 hereto, Borrower fails to maintain its status as a Special Single-Purpose Entity; or
(8) if any Transfer occurs other than as permitted by this Agreement.
(a) Borrower filing a voluntary petition under the Bankruptcy Remote Entity Code or any other Federal or state bankruptcy or insolvency law; (b) the filing of an involuntary petition against Borrower under the Bankruptcy Code or any other Federal or state bankruptcy or insolvency law by any other Person in accordance which Borrower or any of the Borrower Parties colludes with or otherwise assists such Person, or soliciting or causing to be solicited petitioning creditors for any involuntary petition against Borrower from any Person; (c) Borrower or any of the Borrower Parties filing an answer consenting to or otherwise acquiescing in or joining in any involuntary petition filed against it, by any other Person under the Bankruptcy Code or any other Federal or state bankruptcy or insolvency law; (d) Borrower or any of the Borrower Parties consenting to or acquiescing in or joining in an application for the appointment of a custodian, receiver, trustee, or examiner for Borrower or all or any portion of the Property; (e) Borrower or any of the Borrower Parties making an assignment for the benefit of creditors, or admitting, in writing or in any legal proceeding, its insolvency or inability to pay its debts as they become due; or (ii) if Borrower or any Borrower Party, or any Affiliate of Borrower or Affiliate of any Borrower Party, in any judicial or quasi-judicial case, action or proceeding directly or indirectly contests the validity or enforceability of the Loan Documents or directly or indirectly contests or intentionally hinders, delays or obstructs the pursuit of any rights or remedies by Lender (including the commencement and/or prosecution of a foreclosure action after an Event of Default. The provisions of this Article 10 shall survive the expiration and termination of this Agreement and such failure results in the substantive consolidation of Borrower with another Person; (C) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any subordinate financing or other voluntary lien encumbering the Property; (D) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any assignment, transfer, or conveyance repayment of the Property or any interest therein as and to the extent required by this Agreement or the Mortgage; or (E) (1) if any petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law, shall be filed by Borrower or Guarantor, or (2) if Borrower or Guarantor files an answer consenting to, or otherwise joining in, any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law filed against it by any other Person, or is found pursuant to a final, unappealable order of a court of competent jurisdiction to have solicited or caused to be solicited creditors to file any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law against Borrower or Guarantor, or (3) if Borrower or Guarantor are found, pursuant to a final unappealable order of a court of competent jurisdiction, to have been in collusion with creditors that initiate a bankruptcy action or proceeding against Borrower or Guarantor or (F) an Event of Default described in Section 8.1(s) hereof shall have occurredIndebtedness.
Appears in 1 contract
Samples: Term Loan Agreement (Strategic Storage Trust VI, Inc.)
Exculpation. Subject to the qualifications below, Lender shall not enforce the liability and obligation of Borrower or its constituent members, partners, shareholders, directors, employees or agents or the direct or indirect constituent members, partners, shareholders, directors, employees or agents thereof (collectively, the “Borrower Parties”) or any other Person, to perform and observe the obligations contained Notwithstanding anything in this AgreementMortgage, the Note or any other security instrument securing the Note, in order to affirm the absence of personal liability on the other Loan Documents by part of Mortgagor, Mortgagee agrees that in any action or proceeding wherein a money judgment shall be sought against any of the Borrower Parties or any other Person, except that Lender may bring a foreclosure action, an action for specific performance or any other appropriate action or proceeding to enable Lender brought to enforce and realize upon the Propertyobligation of Mortgagor to pay or perform any indebtedness or obligation created or arising under the Note or this Mortgage, the Rents judgment or any other collateral given to Lender pursuant to this Agreement and the other Loan Documents; provided, however, that, except as specifically provided herein, any judgment in any such action or proceeding decree shall be enforceable against the Borrower Parties Mortgagor only to the extent of their interest the joint and several interests of Mortgagor in the Mortgaged Property, the Rents and in any other collateral given to Lender, and Lender, by accepting this Agreement, the Note and the other Loan Documents, agrees that it such judgment shall not sxx forbe subject to execution on, seek or demand any deficiency judgment against any nor be a lien on, assets of Mortgagor other than the joint and several interests in the Mortgaged Property. The foregoing limitation of liability of the Borrower Parties Mortgagor or any other Person in any such action or proceeding under or by reason of or in connection with this Agreement, the Note or any of the other Loan Documents. The provisions of this paragraph its general partner shall notnot apply, however, (i) constitute a waiver, release or impairment of any obligation evidenced or secured by this Agreement, the Note or to any of the other Loan Documents; (ii) impair the right of Lender to name any of the Borrower Parties, as a party defendant in any action or suit for foreclosure and sale under the Mortgage; (iii) affect the validity or enforceability of any guaranty made in connection with the Loan or any rights and remedies of Lender thereunder; (iv) impair the right of Lender to obtain the appointment of a receiver; (v) impair the enforcement of the Assignment of Leases and Rents; or (vi) constitute a waiver of the right of Lender to enforce the liability and obligation of Borrower (but not against any members of Borrower (other than Guarantor to the extent provided in the Non-Recourse Guaranty) or their direct or indirect constituent members or partners or any other Person), by money judgment or otherwise, to the extent of any loss, damage, cost, expense, liability, claim or other obligation (but excluding any punitive, consequential or speculative damages) incurred by Lender (including attorneys’ fees and costs reasonably incurred) arising out of or in connection with the following:
(a) fraud Fraud or intentional misrepresentation by Borrower on the part of the Mortgagor or Guarantor in connection with any of its partners, or any waste of the Loan;Mortgaged Property.
(b) intentional physical waste of the Property (includingAny rents, but not limited to, waste due to gross negligence) by Borrower issues or any affiliate thereof; provided, however, such physical waste shall exclude wear and tear to the Property that occurs in the ordinary course of business of the Property by Borrower or any affiliate thereof;
(c) the material breach of any representation, warranty, covenant or indemnification provision in the Environmental Indemnity or in this Agreement concerning Environmental Laws, Hazardous Substances and Asbestos;
(d) the removal or disposal by Borrower or any affiliate thereof of any portion of the Property after an Event of Default has occurred and while it is continuing, unless such portion of the Property is replaced by an item of equal or greater value as determined by Lender in its reasonable discretion;
(e) the misapplication or conversion by Borrower or any affiliate thereof of (i) any insurance proceeds paid by reason of any loss, damage or destruction to the Property, (ii) any awards or other amounts received in connection with the condemnation of all or a portion of the Property, (iii) any Rents following an Event of Default or (iv) any Rents paid profits collected more than one (1) month in advance;advance of their due dates.
(c) Any misapplication of proceeds, rents, issues or profits, security deposits, and any other payments from tenants or occupancy (including, without limitation, lease termination fees), insurance proceeds, condemnation awards, or other sums of a similar nature.
(d) Mortgagor's or any of its partners otherwise committing any wrongful act, the apparent purpose or intent of which is to deprive Mortgagee of any of its security for the Secured Indebtedness.
(e) Liability under any environmental covenants, conditions, and indemnity contained in this Mortgage and in any separate environmental indemnity agreement executed by Mortgagor.
(f) failure Rents or other income not properly applied to any portion then due of the Secured Indebtedness or the normal operating expenses incurred or accrued.
(g) Personalty or fixtures removed or allowed to be removed by or on behalf of Mortgagor or any of its partners and not replaced by items of equal or greater value than the personalty or fixtures so removed; however, this provision shall not apply to those items destroyed in the ordinary course of business or those items removed in the ordinary course of business and not intended to deprive Mortgagee of any of its security for the Secured Indebtedness.
(h) An amount equal to the sum of all payments made by Mortgagor to any junior lienholders during any period in which a monetary default exists under the Note, this Mortgage or any loan agreement executed by Mortgagor in connection with the Secured Indebtedness.
(i) Failure to pay any taxes or assessments prior to delinquency, or to pay charges for labor or labor, materials or taxes or other charges that which can create liens superior to the lien of the Mortgage on any portion of the Mortgaged Property unless such and any sums expended by Mortgagee in the performance of or compliance with the obligations of Mortgagor or any of its partners under any loan agreement executed by Mortgagor in connection with the Secured Indebtedness, including, without limitation, sums expended to pay taxes or assessments or hazard insurance premiums, capital improvement expenditures, bills for utilities or other charges are being contested in accordance herewith service or such taxes or charges have been delivered to Lender in accordance with Section 3.3 hereof or Borrower has complied with Section 5.2 hereof; andproducts for the benefit of the Mortgaged Property.
(gj) The cost of compliance with all federal, state and local laws and regulations, as well as the cost of investigating any security deposits collected action or charge thereunder, and/or damages suffered by Borrower Mortgagee as a result of the failure of Mortgagor or any affiliate thereof of its partners to pay or comply with respect to the Property which are not delivered to Lender upon a foreclosure of the Property or action in lieu thereof, except to the extent any such security deposits were applied in accordance with the terms and conditions of any of the Leases prior foregoing.
(k) Tortious or other acts or omissions giving rise to claims against Mortgagee, including, without limitation, claims by tenants for damages or offsets.
(l) Attorneys' fees, court costs and other expenses incurred by Mortgagee in connection with the Mortgagee's enforcement of Mortgagor's personal liability as set forth herein. In addition to the foregoing, nothing contained in this Section shall in any manner limit the liability of Mortgagor to pay over to Mortgagee any of the Rents and Profits or proceeds of the Mortgaged Property, if the same are received or held by Mortgagor after Mortgagor is made aware, by written notice from Mortgagee or otherwise, of the occurrence of the Event of Default that gave rise to such foreclosure or action in lieu thereof. Notwithstanding anything to the contrary in any of the Loan Documents (i) Lender shall not be deemed to have waived any right which Lender may have under Section 506(a), 506(b), 1111(b) or any other provisions of the U.S. Bankruptcy Code to file a claim for the full amount of the Debt or to require that all collateral shall continue to secure all of the Debt owing to Lender in accordance with the Loan Documents, and (ii) the Debt shall become fully recourse to Borrower (but not its members (other than Guarantor solely to the extent provided in the Non-Recourse Guaranty) or other direct or indirect constituent members or partners or any other Person) in the event that: (A) the first full Monthly Debt Service Payment Amount (as defined in the Note) under the Note is not paid when due; (B) other than in connection with a default under subsection (x) of the definition of Special Purpose Bankruptcy Remote Entity set forth in Schedule 5 hereto, Borrower fails to maintain its status as a Special Purpose Bankruptcy Remote Entity in accordance with the provisions of this Agreement and such failure results in the substantive consolidation of Borrower with another Person; (C) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any subordinate financing or other voluntary lien encumbering the Property; (D) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any assignment, transfer, or conveyance of the Property or any interest therein as and to the extent required by this Agreement or the Mortgage; or (E) (1) if any petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law, shall be filed by Borrower or Guarantor, or (2) if Borrower or Guarantor files an answer consenting to, or otherwise joining in, any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law filed against it by any other Person, or is found pursuant to a final, unappealable order of a court of competent jurisdiction to have solicited or caused to be solicited creditors to file any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law against Borrower or Guarantor, or (3) if Borrower or Guarantor are found, pursuant to a final unappealable order of a court of competent jurisdiction, to have been in collusion with creditors that initiate a bankruptcy action or proceeding against Borrower or Guarantor or (F) an Event of Default described in Section 8.1(s) hereof shall have occurredDefault, as hereinbefore defined.
Appears in 1 contract
Samples: Mortgage, Assignment of Rents and Security Agreement (Angeles Partners Viii)
Exculpation. Subject to the qualifications below, Lender The Administrative Agent shall not enforce the liability and obligation of Borrower have any duties or its constituent members, partners, shareholders, directors, employees or agents or the direct or indirect constituent members, partners, shareholders, directors, employees or agents thereof (collectively, the “Borrower Parties”) or any other Person, to perform and observe the obligations contained responsibilities except those expressly set forth in this Agreement, the Note or any of the other Loan Documents by any action or proceeding wherein a money judgment shall be sought against any of the Borrower Parties or any other Person, except that Lender may bring a foreclosure action, an action for specific performance or any other appropriate action or proceeding to enable Lender to enforce and realize upon the Property, the Rents or any other collateral given to Lender pursuant to this Agreement and the other Loan Documents; provided, however, that, except as specifically provided herein, any judgment in any such action or proceeding shall be enforceable against the Borrower Parties only to the extent of their interest in the Property, the Rents and in any other collateral given to Lender, and Lender, by accepting this Agreement, the Note and the other Loan Documents, agrees that it shall not sxx for, seek or demand any deficiency judgment against any of the Borrower Parties or any other Person in any such action or proceeding under or by reason of or in connection with this Agreement, the Note or any of the other Loan Documents. The provisions of this paragraph shall not, however, (i) constitute a waiver, release or impairment of any obligation evidenced or secured by this Agreement, Neither the Note or Administrative Agent nor any of the other Loan Documents; (ii) impair the right of its directors, officers, employees, affiliates or agents shall be liable to any Lender to name any of the Borrower Parties, as a party defendant in for any action taken or suit for foreclosure and sale omitted to be taken by it under the Mortgage; (iii) affect the validity or enforceability of any guaranty made in connection with the Loan or any rights and remedies of Lender thereunder; (iv) impair the right of Lender to obtain the appointment of a receiver; (v) impair the enforcement of the Assignment of Leases and Rents; or (vi) constitute a waiver of the right of Lender to enforce the liability and obligation of Borrower (but not against any members of Borrower (other than Guarantor to the extent provided in the Non-Recourse Guaranty) or their direct or indirect constituent members or partners this Agreement or any other Person)Loan Document, by money judgment or otherwise, to the extent of any loss, damage, cost, expense, liability, claim or other obligation (but excluding any punitive, consequential or speculative damages) incurred by Lender (including attorneys’ fees and costs reasonably incurred) arising out of or in connection with the following:
(a) fraud herewith or intentional misrepresentation by Borrower therewith, except for its own willful misconduct or Guarantor in connection with the Loan;
(b) intentional physical waste of the Property (including, but not limited to, waste due to gross negligence) by Borrower or any affiliate thereof; provided, however, such physical waste shall exclude wear and tear to the Property that occurs in the ordinary course of business of the Property by Borrower or any affiliate thereof;
(c) the material breach of any representation, warranty, covenant or indemnification provision in the Environmental Indemnity or in this Agreement concerning Environmental Laws, Hazardous Substances and Asbestos;
(d) the removal or disposal by Borrower or any affiliate thereof of any portion of the Property after an Event of Default has occurred and while it is continuing, unless such portion of the Property is replaced by an item of equal or greater value negligence as determined by Lender in its reasonable discretion;
(e) the misapplication or conversion by Borrower or any affiliate thereof of (i) any insurance proceeds paid by reason of any loss, damage or destruction to the Property, (ii) any awards or other amounts received in connection with the condemnation of all or a portion of the Property, (iii) any Rents following an Event of Default or (iv) any Rents paid more than one (1) month in advance;
(f) failure to pay charges for labor or materials or taxes or other charges that can create liens superior to the lien of the Mortgage on any portion of the Property unless such taxes or other charges are being contested in accordance herewith or such taxes or charges have been delivered to Lender in accordance with Section 3.3 hereof or Borrower has complied with Section 5.2 hereof; and
(g) any security deposits collected by Borrower or any affiliate thereof with respect to the Property which are not delivered to Lender upon a foreclosure of the Property or action in lieu thereof, except to the extent any such security deposits were applied in accordance with the terms and conditions of any of the Leases prior to the occurrence of the Event of Default that gave rise to such foreclosure or action in lieu thereof. Notwithstanding anything to the contrary in any of the Loan Documents (i) Lender shall not be deemed to have waived any right which Lender may have under Section 506(a), 506(b), 1111(b) or any other provisions of the U.S. Bankruptcy Code to file a claim for the full amount of the Debt or to require that all collateral shall continue to secure all of the Debt owing to Lender in accordance with the Loan Documents, and (ii) the Debt shall become fully recourse to Borrower (but not its members (other than Guarantor solely to the extent provided in the Non-Recourse Guaranty) or other direct or indirect constituent members or partners or any other Person) in the event that: (A) the first full Monthly Debt Service Payment Amount (as defined in the Note) under the Note is not paid when due; (B) other than in connection with a default under subsection (x) of the definition of Special Purpose Bankruptcy Remote Entity set forth in Schedule 5 hereto, Borrower fails to maintain its status as a Special Purpose Bankruptcy Remote Entity in accordance with the provisions of this Agreement and such failure results in the substantive consolidation of Borrower with another Person; (C) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any subordinate financing or other voluntary lien encumbering the Property; (D) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any assignment, transfer, or conveyance of the Property or any interest therein as and to the extent required by this Agreement or the Mortgage; or (E) (1) if any petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law, shall be filed by Borrower or Guarantor, or (2) if Borrower or Guarantor files an answer consenting to, or otherwise joining in, any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law filed against it by any other Person, or is found pursuant to a final, unappealable order of a court of competent jurisdiction to have solicited in a final and non-appealable decision, nor responsible for any recitals or caused warranties herein or therein, nor for the effectiveness, enforceability, validity or due execution of this Agreement or any other Loan Document, nor for the creation, perfection or priority of any Liens purported to be solicited creditors to file created by any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy lawof the Loan Documents, or the validity, genuineness, enforceability, existence, value or sufficiency of any similar federal collateral security, nor to make any inquiry respecting the performance by the Borrower of its obligations hereunder or state law against Borrower under any other Loan Document. Any such inquiry which may be made by the Administrative Agent shall not obligate it to make any further inquiry or Guarantorto take any action. The Administrative Agent shall be entitled to rely upon (and shall be fully protected in relying upon) advice of counsel concerning legal matters and upon any notice, consent, certificate, statement or (3) if Borrower or Guarantor are found, pursuant writing which the Administrative Agent believes to a final unappealable order of a court of competent jurisdiction, be genuine and to have been presented by a proper Person. If the Administrative Agent requests instructions from the Required Lenders with respect to any act or action (including failure to act) in collusion connection with creditors that initiate a bankruptcy this Agreement or any other Loan Document, the Administrative Agent shall be entitled to refrain from such act or taking such action or proceeding against Borrower or Guarantor or (F) an Event of Default described in Section 8.1(s) hereof unless and until the Administrative Agent shall have occurredreceived instructions from the Required Lenders; and the Administrative Agent shall not incur liability to any Lender by reason of so refraining. Without limiting the foregoing, neither any Lender nor the holder of any Note shall have any right of action whatsoever against the Administrative Agent as a result of the Administrative Agent acting or refraining from acting hereunder or under any other Loan Document in accordance with the instructions of the Required Lenders. The duties of the Administrative Agent shall be mechanical and administrative in nature; the Administrative Agent shall not have by reason of this Agreement or any other Loan Document a fiduciary relationship in respect of any Lender or the holder of any Note; and nothing in this Agreement or in any other Loan Document, expressed or implied, is intended to or shall be so construed as to impose upon the Administrative Agent any obligations in respect of this Agreement or any other Loan Document except as expressly set forth herein or therein.
Appears in 1 contract
Samples: Credit Agreement (Dollar Thrifty Automotive Group Inc)
Exculpation. Subject (a) Unless due to, and to the qualifications belowextent of, Lender shall not enforce the liability and obligation gross negligence or willful misconduct of Borrower Landlord or Landlord’s agents or employees or of a Senior Interest Holder or its constituent membersagents, partnersneither Landlord nor any Senior Interest Holder, nor any of their agents, officers, directors, shareholders, directorsmanagers, employees or agents or the direct or indirect constituent members, partnerspartners or principals (disclosed or undisclosed) shall be liable to Tenant or Tenant’s agents, shareholdersemployees, directorscontractors, employees invitees or agents thereof (collectively, the “Borrower Parties”) licensees or any other Personoccupant of the Premises in connection with any injury to Tenant or to any other person or for any damage to, to perform and observe the obligations contained in this Agreementor loss (by theft or otherwise) of, the Note or any of the other Loan Documents by any action Tenant’s Property or proceeding wherein a money judgment shall be sought against any of the Borrower Parties property of Tenant or any other Personperson arising from or in connection with the use by Tenant or such other person of the Premises or the Building, except irrespective of the cause of such injury, damage or loss, it being understood that Lender may bring a foreclosure actionno property, an action other than such as might normally be brought upon or kept in the Premises as incidental to the reasonable use of the Premises for specific performance the purposes herein permitted will be brought upon or any other appropriate action or proceeding to enable Lender to enforce and realize upon be kept in the Property, the Rents or any other collateral given to Lender pursuant to this Agreement and the other Loan DocumentsPremises; provided, however, that, except as specifically provided herein, any judgment in that even if due to any such action gross negligence of Landlord, Landlord’s agents or proceeding shall be enforceable against the Borrower Parties only to the extent of their interest in the Propertyemployees, the Rents and in any other collateral given to Lender, and Lender, by accepting this Agreement, the Note and the other Loan Documents, agrees that it shall not sxx for, seek or demand any deficiency judgment against any of the Borrower Parties or any other Person in any such action Senior Interest Holder or proceeding its agents or breach by Landlord of its obligations under or by reason of or in connection with this AgreementLease, the Note or any of the other Loan Documents. The provisions of this paragraph shall not, however, (i) constitute a waiver, release or impairment of any obligation evidenced or secured by this Agreement, the Note or any of the other Loan Documents; (ii) impair the right of Lender to name any of the Borrower Parties, as a party defendant in any action or suit for foreclosure and sale under the Mortgage; (iii) affect the validity or enforceability of any guaranty made in connection with the Loan or any rights and remedies of Lender thereunder; (iv) impair the right of Lender to obtain the appointment of a receiver; (v) impair the enforcement of the Assignment of Leases and Rents; or (vi) constitute a waiver of the right of Lender to enforce the liability and obligation of Borrower (but not against any members of Borrower (other than Guarantor to the extent provided in the Non-Recourse Guaranty) or their direct or indirect constituent members or partners or any other Person), by money judgment or otherwiseTenant waives, to the full extent permitted by applicable law, any claim for consequential damages in connection therewith. Landlord and any Senior Interest Holder and their respective agents shall not be liable for any loss or damage to any person or property even if due to the negligence of Landlord or any loss, damage, cost, expense, liability, claim Senior Interest Holder or other obligation (but excluding their agents. Any employee to whom any punitive, consequential property shall be entrusted by or speculative damages) incurred by Lender (including attorneys’ fees on behalf of Tenant shall be deemed to be acting as Tenant’s agent with respect to such property and costs reasonably incurred) arising out neither Landlord nor any Senior Interest Holder nor their respective agents or employees shall be liable for any loss of or in connection with the following:
(a) fraud damage to any such property by theft or intentional misrepresentation by Borrower or Guarantor in connection with the Loan;otherwise.
(b) intentional physical waste Except for such liability as may be imposed by law for the gross negligence of Landlord or Landlord’s agents or employees, or for the Property (including, but not limited to, waste due to gross negligence) breach by Borrower or any affiliate thereof; provided, however, such physical waste shall exclude wear and tear to the Property that occurs in the ordinary course of business of the Property by Borrower or any affiliate thereof;
(c) the material breach Landlord of any representationterm of this Lease to be performed by Landlord, warranty, covenant or indemnification provision in the Environmental Indemnity or in this Agreement concerning Environmental Laws, Hazardous Substances and Asbestos;
(d) the removal or disposal by Borrower or any affiliate thereof of any portion of the Property after an Event of Default has occurred and while it is continuing, unless such portion of the Property is replaced by an item of equal or greater value as determined by Lender in its reasonable discretion;
(e) the misapplication or conversion by Borrower or any affiliate thereof of no (i) any insurance proceeds paid performance by reason Landlord, Tenant or others of any loss, damage repairs or destruction Alterations in or to the PropertyBuilding or Premises, (ii) failure of Landlord or others to make any awards such repairs or other amounts received in connection with the condemnation of all or a portion of the PropertyAlterations, (iii) any Rents following an Event damage to the Building Systems or equipment, Premises or the property of Default or Tenant, (iv) injury to any Rents paid more than one persons caused by other tenants or persons in the Building or by operations in the construction of any private, public or quasi-public work, or by any other cause, (1v) month Latent Defect in advance;
the Building, Building Systems or equipment or Premises, (fvi) failure to pay charges for labor diminution or materials shutting off of light, air or taxes or other charges that can create liens superior to view by any structure which may be erected on lands in the lien vicinity of the Mortgage Building or (vii) inconvenience or annoyance to Tenant or injury to or interruption of Tenant’s business by reason of anything referred to in the foregoing subsections (i) through (vi) shall impose any liability on any portion Landlord to Tenant. No representation, guaranty or warranty is made that the communications or security systems, devices or procedures of the Property unless such taxes or other charges are being contested in accordance herewith or such taxes or charges have been delivered Building will be effective to Lender in accordance with Section 3.3 hereof or Borrower has complied with Section 5.2 hereof; and
(g) any security deposits collected by Borrower prevent injury to Tenant or any affiliate thereof with respect to the Property which are not delivered to Lender upon a foreclosure of the Property other person or action in lieu thereofdamage to, except to the extent any such security deposits were applied in accordance with the terms and conditions of or loss (by theft or otherwise) of, any of the Leases prior to property of Tenant or the occurrence property of the Event of Default that gave rise to such foreclosure or action in lieu thereof. Notwithstanding anything to the contrary in any of the Loan Documents (i) Lender shall not be deemed to have waived any right which Lender may have under Section 506(a), 506(b), 1111(b) or any other provisions of the U.S. Bankruptcy Code to file a claim for the full amount of the Debt or to require that all collateral shall continue to secure all of the Debt owing to Lender in accordance with the Loan Documentsperson, and (ii) Landlord reserves the Debt shall become fully recourse right to Borrower (but not its members (other than Guarantor solely discontinue or modify at any time such communications or security systems or procedures without liability to the extent provided in the Non-Recourse Guaranty) or other direct or indirect constituent members or partners or any other Person) in the event that: (A) the first full Monthly Debt Service Payment Amount (as defined in the Note) under the Note is not paid when due; (B) other than in connection with a default under subsection (x) of the definition of Special Purpose Bankruptcy Remote Entity set forth in Schedule 5 hereto, Borrower fails to maintain its status as a Special Purpose Bankruptcy Remote Entity in accordance with the provisions of this Agreement and such failure results in the substantive consolidation of Borrower with another Person; (C) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any subordinate financing or other voluntary lien encumbering the Property; (D) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any assignment, transfer, or conveyance of the Property or any interest therein as and to the extent required by this Agreement or the Mortgage; or (E) (1) if any petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law, shall be filed by Borrower or Guarantor, or (2) if Borrower or Guarantor files an answer consenting to, or otherwise joining in, any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law filed against it by any other Person, or is found pursuant to a final, unappealable order of a court of competent jurisdiction to have solicited or caused to be solicited creditors to file any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law against Borrower or Guarantor, or (3) if Borrower or Guarantor are found, pursuant to a final unappealable order of a court of competent jurisdiction, to have been in collusion with creditors that initiate a bankruptcy action or proceeding against Borrower or Guarantor or (F) an Event of Default described in Section 8.1(s) hereof shall have occurredTenant.
Appears in 1 contract
Samples: Lease (MF Global Ltd.)
Exculpation. Subject to the qualifications below(a) Except as otherwise expressly provided in this Section 9.4, Lender shall not enforce the liability and obligation of Borrower or its constituent members, partners, shareholders, directors, employees or agents or the direct or indirect constituent members, partners, shareholders, directors, employees or agents thereof (collectively, the “Borrower Parties”) or any other Person, to perform and observe the obligations contained in this Agreement, the Note or the Pledge Agreement or any of the other Loan Documents Document by any action or proceeding wherein a money judgment shall be sought against any of the Borrower Parties or any other PersonExculpated Party, except that Lender may bring a foreclosure action, an action for specific performance or any other appropriate action or proceeding to enable Lender to enforce and realize upon the Propertythis Agreement, the Rents or Note, the Pledge Agreement, the other Loan Documents, and the Collateral and any other collateral given for the Debt in which a security interest is granted to Lender pursuant to by this Agreement, the Pledge Agreement and or the other Loan Documents; provided, however, that, except as specifically provided herein, that any judgment in any such action or proceeding shall be enforceable against the Borrower Parties only to the extent of their Borrower’s interest in the PropertyCollateral, the Rents and in any other collateral given in which a security interest is granted to LenderLender by this Agreement, and the Pledge Agreement or the other Loan Documents. Lender, by accepting this Agreement, the Note and the other Loan DocumentsPledge Agreement, agrees that it shall not sxx not, except as otherwise expressly provided in this Section 9.4, xxx for, seek or demand any deficiency or other money judgment against Borrower, any direct or indirect member, manager, shareholder, partner, beneficiary or other owner of beneficial ownership interests in Borrower, or any affiliate, director, officer, employee, trustee or agent of any of the Borrower Parties or any other Person foregoing (each, an “Exculpated Party” and, collectively, the “Exculpated Parties”) in any such action or proceeding proceeding, under or by reason of or under or in connection with this Agreement, the Note Note, the Pledge Agreement or any of the other Loan Documents. The provisions of this paragraph Section shall not, however, (i) constitute a waiver, release or impairment of any obligation evidenced or secured by this Agreement, the Note Note, the Pledge Agreement or any of the other Loan Documents; (ii) impair the right of Lender to name any of the Borrower Parties, as a party defendant in any action or suit for judicial foreclosure and sale under the MortgagePledge Agreement (subject, however, to the aforesaid limitation on Lender’s right to xxx, seek or demand a deficiency or other money judgment against Borrower or any other Exculpated Party); (iii) affect the validity or enforceability of any guaranty indemnity (including, without limitation, the Environmental Indemnity), guaranty, master lease or similar instrument made in connection with this Agreement, the Note, the Pledge Agreement, or the other Loan Documents (subject, however, to any exculpatory or any rights and remedies of Lender thereundernon-recourse provisions appearing in such indemnity, guaranty or similar instrument); (iv) impair the right of Lender to obtain the appointment of a receiver; (v) impair the enforcement of the Assignment of Leases and Rents[intentionally omitted]; or (vi) constitute a waiver of impair the right of Lender to enforce the liability provisions of Sections 4.1.8, 4.1.28, 5.1.9 and obligation 5.2.8 hereof (subject, however, to the aforesaid limitation on Lender’s right to xxx, seek or demand a deficiency or other money judgment against Borrower or any other Exculpated Party which such limitation, with respect to Borrower, shall not apply to the Environmental Indemnity); or (vii) impair the right of Lender to obtain a deficiency judgment or other judgment on the Note against Borrower (but not against any members of Borrower (other than Guarantor if and to the extent necessary to obtain any insurance proceeds or condemnation awards to which Lender would otherwise be entitled under this Agreement; provided in the Non-Recourse Guaranty) or their direct or indirect constituent members or partners or any other Person)however, by money that Lender shall only be entitled to enforce such judgment or otherwise, to the extent of any lossthe insurance proceeds and/or condemnation awards.
(b) Notwithstanding the provisions of this Section 9.4 to the contrary, damage, cost, expense, liability, claim or other obligation Borrower and Guarantor pursuant to the Guaranty (but excluding not any punitiveother Exculpated Parties) shall be personally liable to Lender for any actual Losses Lender incurs due to the following (collectively, consequential the “Recourse Events”):
(i) any fraud committed by Borrower, Mortgage Borrower or speculative damages) incurred by Lender (including attorneys’ fees and costs reasonably incurred) arising out any of their Affiliates or agents in connection with the following:Loan or Mortgage Loan;
(aii) fraud or any intentional and material misrepresentation by Borrower or Guarantor Mortgage Borrower in connection with any of the LoanLoan Documents or the Mortgage Loan Documents;
(biii) the misappropriation by Borrower, Mortgage Borrower or any of their Affiliates or agents of any funds (including misappropriation of Rents, security deposits and/or Net Proceeds);
(iv) any Transfer, Sale or Pledge of the Property, the Collateral or any interest of a Restricted Party therein, and in each case, which is prohibited hereunder;
(v) the intentional and material breach of any representation in the Environmental Indemnity or in Sections 4.1.39 or 5.1.19 hereof;
(vi) any voluntary filing by Borrower, Mortgage Borrower, Mortgage Principal or Principal under the Bankruptcy Code or any other federal or state bankruptcy or insolvency law;
(vii) any involuntary filing against Borrower, Mortgage Borrower, Mortgage Principal or Principal under the Bankruptcy Code or any other federal or state bankruptcy or insolvency law by any Person acting at the request or under the direction of Borrower, Mortgage Borrower or any of their Affiliates or agents;
(viii) Mortgage Borrower, Mortgage Principal, Borrower or Principal consents to or acquiesces in or joins in an application for the appointment of a custodian, receiver, trustee or examiner for Mortgage Borrower, Mortgage Principal, Borrower or Principal or any portion of the Property or the Collateral;
(ix) Borrower’s making a distribution to its equity owners after the occurrence and during the continuance of an Event of Default;
(x) Mortgage Borrower, Mortgage Principal, Borrower or Principal makes an assignment for the benefit of creditors;
(xi) any intentional physical waste of the Property (includingby Mortgage Borrower, but not limited toMortgage Principal, waste due to gross negligence) by Borrower or any affiliate thereof; provided, however, such physical waste shall exclude wear and tear to the Property that occurs in the ordinary course of business of the Property by Borrower Principal or any affiliate thereofof their Affiliates or agents;
(cxii) any claims, actions or other proceedings brought by the material breach unit holders of any representation, warranty, covenant or indemnification provision in Archstone Xxxxx Operating Trust with respect to the Environmental Indemnity or in this Agreement concerning Environmental Laws, Hazardous Substances and Asbestos;merger of Archstone Xxxxx Operating Trust occurring simultaneously herewith; or
(dxiii) Mortgage Borrower’s failure to obtain any consent required with respect to the removal or disposal by Borrower or any affiliate thereof of any portion transfer of the Property after an Event of Default has occurred and while it is continuing, unless such portion of the Property is replaced by an item of equal or greater value as determined by Lender in its reasonable discretion;
(e) the misapplication or conversion by Borrower or any affiliate thereof of (i) any insurance proceeds paid by reason of any loss, damage or destruction to the Property, (ii) any awards or other amounts received applicable Properties in connection with the condemnation merger of all or a portion of the Property, (iii) any Rents following an Event of Default or (iv) any Rents paid more than one (1) month in advance;
(f) failure to pay charges for labor or materials or taxes or other charges that can create liens superior to the lien of the Mortgage on any portion of the Property unless such taxes or other charges are being contested in accordance herewith or such taxes or charges have been delivered to Lender in accordance with Section 3.3 hereof or Borrower has complied with Section 5.2 hereof; and
(g) any security deposits collected by Borrower or any affiliate thereof with respect to the Property which are not delivered to Lender upon a foreclosure of the Property or action in lieu thereof, except to the extent any such security deposits were applied in accordance with the terms and conditions of any of the Leases prior to the occurrence of the Event of Default that gave rise to such foreclosure or action in lieu thereof. Notwithstanding anything to the contrary in any of the Loan Documents (i) Lender shall not be deemed to have waived any right which Lender may have under Section 506(a), 506(b), 1111(b) or any other provisions of the U.S. Bankruptcy Code to file a claim for the full amount of the Debt or to require that all collateral shall continue to secure all of the Debt owing to Lender in accordance with the Loan Documents, and (ii) the Debt shall become fully recourse to Borrower (but not its members (other than Guarantor solely to the extent provided in the Non-Recourse Guaranty) or other direct or indirect constituent members or partners or any other Person) in the event that: (A) the first full Monthly Debt Service Payment Amount (as defined in the Note) under the Note is not paid when due; (B) other than in connection with a default under subsection (x) of the definition of Special Purpose Bankruptcy Remote Entity set forth in Schedule 5 hereto, Borrower fails to maintain its status as a Special Purpose Bankruptcy Remote Entity in accordance with the provisions of this Agreement and such failure results in the substantive consolidation of Borrower with another Person; (C) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any subordinate financing or other voluntary lien encumbering the Property; (D) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any assignment, transfer, or conveyance of the Property or any interest therein as and to the extent required by this Agreement or the Mortgage; or (E) (1) if any petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law, shall be filed by Borrower or Guarantor, or (2) if Borrower or Guarantor files an answer consenting to, or otherwise joining in, any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law filed against it by any other Person, or is found pursuant to a final, unappealable order of a court of competent jurisdiction to have solicited or caused to be solicited creditors to file any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law against Borrower or Guarantor, or (3) if Borrower or Guarantor are found, pursuant to a final unappealable order of a court of competent jurisdiction, to have been in collusion with creditors that initiate a bankruptcy action or proceeding against Borrower or Guarantor or (F) an Event of Default described in Section 8.1(s) hereof shall have occurredArchstone Xxxxx Operating Trust occurring simultaneously herewith.
Appears in 1 contract
Samples: Mezzanine Loan Agreement (Archstone Smith Operating Trust)
Exculpation. (a) Subject to the qualifications below, Lender shall not enforce the liability and obligation of Borrower or its constituent members, partners, shareholders, directors, employees or agents or the direct or indirect constituent members, partners, shareholders, directors, employees or agents thereof (collectively, the “Borrower Parties”) or any other Person, to perform and observe the obligations contained in the Note, this Agreement, the Note Pledge Agreement or any of the other Loan Documents by any action or proceeding wherein a money judgment or any deficiency judgment or other judgment establishing personal liability shall be sought against Borrower, any other Borrower Party, or any principal, director, officer, employee, beneficiary, shareholder, partner, member, trustee, agent, or Affiliate of Borrower or any other Borrower Party or any legal representatives, successors or assigns of any of the Borrower Parties or any other Personforegoing (collectively, the “Exculpated Parties”), except that Lender may bring a foreclosure action, an action for specific performance or any other appropriate action or proceeding to enable Lender to enforce and realize upon its interest under the Note, this Agreement, the Pledge Agreement and the other Loan Documents, or in the Property, the Rents Mezzanine A Collateral, the Collateral (or any portion thereof), or any other collateral given to Lender pursuant to this Agreement and the other Loan Documents; provided, however, that, except as specifically provided herein, any judgment in any such action or proceeding shall be enforceable against the Borrower Parties only to the extent of their Borrower’s interest in the Property, in the Rents Mezzanine A Collateral, in the Collateral and in any other collateral given to Lender, and Lender, by accepting the Note, this Agreement, the Note Pledge Agreement and the other Loan Documents, agrees that it shall not sxx sue for, seek or demand any deficiency judgment against Borrower or any of the Borrower Exculpated Parties or any other Person in any such action or proceeding under or by reason of or under or in connection with the Note, this Agreement, the Note Pledge Agreement or any of the other Loan Documents. The provisions of this paragraph Section shall not, however, (i1) constitute a waiver, release or impairment of any obligation evidenced or secured by this Agreement, the Note or any of the other Loan Documents; (ii2) impair the right of Lender to name any of the Borrower Parties, as a party defendant in any action or suit for foreclosure and sale under the MortgagePledge Agreement; (iii3) affect the validity or enforceability of any indemnity, guaranty or similar instrument (including, without limitation, indemnities set forth in Article 12 hereof, Section 11.2 hereof, in the Guaranty and the Environmental Indemnity) made in connection with the Loan or any of the rights and remedies of Lender thereunderthereunder (including, without limitation, Xxxxxx’s right to enforce said rights and remedies against Xxxxxxxx and/or Guarantor (as applicable) personally and without the effect of the exculpatory provisions of this Article 13); (iv4) impair the rights of Lender to (A) obtain the appointment of a receiver and/or (B) enforce its rights and remedies provided in Articles 8 and 9 hereof; (5) impair the enforcement of the Pledge Agreement or any other Loan Documents; (6) impair the right of Lender to obtain the appointment enforce Section 4.12(e) of a receiverthis Agreement; (v7) impair constitute a prohibition against Lender to seek a deficiency judgment against Borrower in order to fully realize the enforcement of security granted by the Assignment of Leases and RentsPledge Agreement or to commence any other appropriate action or proceeding in order for Lender to exercise its remedies against the Property (or any portion thereof), the Mezzanine A Collateral (or any portion thereof) and/or the Collateral (or any portion thereof); or (vi) 8) constitute a waiver of the right of Lender to enforce the liability and obligation of Borrower (but not against any members of Borrower (other than Guarantor to the extent provided in the Non-Recourse Guaranty) or their direct or indirect constituent members or partners or any other Person)Borrower, by money judgment or otherwise, to the extent of any loss, damage, cost, expense, liability, claim or other obligation (but excluding any punitive, consequential or speculative damages) Loss actually incurred by Lender Xxxxxx (including reasonable attorneys’ fees and costs reasonably incurred) arising out of or in connection with the following:
(ai) fraud or intentional material misrepresentation by Borrower Xxxxxxxx, Mortgage Borrower, Mezzanine A Borrower, any SPE Component Entity, any Mortgage SPE Component Entity, any Mezzanine A SPE Component Entity, Sponsor, any Affiliated Manager, Guarantor or Guarantor any director, officer, beneficiary, shareholder, partner, member, employee or agent acting on behalf of any of the foregoing (each, a “Recourse Party”) in connection with the Loan;
(bii) intentional willful misconduct of any Recourse Party in connection with the Loan;
(iii) the breach of any indemnification provision in the Loan Documents, the Mezzanine A Loan Documents or the Mortgage Loan Documents concerning environmental laws, hazardous substances and asbestos and any indemnification of Lender with respect thereto;
(iv) material physical waste to any Property caused by the intentional acts of the Property (includingany Recourse Party, but not limited to, waste due only to gross negligence) by Borrower or any affiliate thereof; provided, however, the extent there is sufficient cash flow from the Properties to prevent such physical waste shall exclude wear and tear such cash flow is made available by (x) Mortgage Lender for the purpose of preventing such physical waste from the applicable Mortgage Loan Reserve Accounts after all conditions to such release had been met to the Property that occurs extent sums sufficient to pay or perform such liability have been deposited with Mortgage Lender in accordance with the terms of the Mortgage Loan Agreement, (y) Mezzanine A Lender for the purpose of preventing such physical waste from accounts (if any) under the Mezzanine A Loan Agreement after all conditions to such release had been met to the extent sums sufficient to pay or perform such liability have been deposited with Mezzanine A Lender in accordance with the terms of the Mezzanine A Loan Agreement or (z) Lender for the purpose of preventing such physical waste from Accounts (if any) after all conditions to such release had been met to the extent sums sufficient to pay or perform such liability have been deposited with Lender in accordance with the terms of this Agreement;
(v) the removal of any property in contravention of the Loan Documents during the continuance of an Event of Default other than in the ordinary course of business of the Property by Borrower or any affiliate thereofbusiness;
(cvi) the material breach misappropriation or conversion of any representation, warranty, covenant or indemnification provision in the Environmental Indemnity or in this Agreement concerning Environmental Laws, Hazardous Substances and Asbestos;
(d) the removal or disposal by Borrower or any affiliate thereof of any portion of the Property after an Event of Default has occurred and while it is continuing, unless such portion following by a Recourse Party in contravention of the Property is replaced by an item of equal or greater value as determined by Lender in its reasonable discretion;
Loan Documents: (e) the misapplication or conversion by Borrower or any affiliate thereof of (iA) any insurance proceeds paid received by Borrower by reason of any loss, damage or destruction to the PropertyCasualty, (iiB) any awards Awards or other amounts received by Borrower from a governmental authority in connection with the condemnation a Condemnation of all or a portion of the Property, (iiiC) any Rents following an Event revenues generated by the Properties, (E) any proceeds received by Mortgage Borrower, Mezzanine A Borrower or Borrower under any owner’s title insurance policy, (F) any distributions or other payments made in violation of Default this Agreement, or (ivG) any Rents paid more than one (1) month in advanceNet Liquidation Proceeds After Debt Service;
(f) failure to pay charges for labor or materials or taxes or other charges that can create liens superior to the lien of the Mortgage on any portion of the Property unless such taxes or other charges are being contested in accordance herewith or such taxes or charges have been delivered to Lender in accordance with Section 3.3 hereof or Borrower has complied with Section 5.2 hereof; and
(gvii) any security Security Deposits, advance deposits or any other deposits collected by Borrower or any affiliate thereof with respect to the any Property which are not delivered to Lender upon a foreclosure of the such Property or action in lieu thereof, except to the extent any such security deposits Security Deposits were delivered to Mortgage Lender in accordance with the Mortgage Loan Agreement and/or applied in accordance with the terms and conditions of any of the Leases applicable Lease;
(viii) any litigation or other legal proceeding related to the Loan filed by a Recourse Party with the effect of delaying, opposing, impeding, obstructing, hindering, enjoining or otherwise interfering with the efforts of Xxxxxx to exercise any rights and remedies available to Lender during the continuance of an Event of Default; provided, however, that there shall be no liability hereunder on account of, and the foregoing shall not restrict, Xxxxxxxx’s or Guarantor’s right to, dispute, in good faith, whether the relevant Event of Default shall have occurred or whether an action taken by Lender pursuant to the Loan Documents is permitted thereby, nor shall Borrower be restricted from, or have liability hereunder for, bringing a good faith counterclaim which if not raised in the foreclosure proceeding would be barred, and which does not seek to enjoin the enforcement action by Xxxxxx;
(ix) Borrower fails to obtain Xxxxxx’s prior written consent to any additional indebtedness or voluntary lien encumbering any Property, the Mezzanine A Collateral or the Collateral and not permitted by the Loan Documents;
(x) Intentionally omitted;
(xi) intentionally omitted;
(xii) (A) any voluntary termination of any PILOT Lease and/or PILOT Document or transfer or surrender of any PILOT Lease and/or PILOT Document (including any PILOT Bond) by Mortgage Borrower without Xxxxxx’s prior written consent other than in connection with Mortgage Borrower acquiring the fee estate from the applicable PILOT Lessor or as otherwise expressly permitted under this Agreement or (B) Mortgage Borrower’s or the applicable Tenant’s failure to comply with or Mortgage Borrower’s or the applicable Tenant’s breach of any PILOT Lease and/or PILOT Document that results in (x) a reduction of any tax abatement and/or mandatory repayment of any past or current tax abatement under such PILOT Lease and/or PILOT Document, as applicable, (y) termination of such PILOT Lease and/or PILOT Document, as applicable, and the benefits thereunder in favor of Mortgage Borrower or Tenant or (z) a default by such Mortgage Borrower under the applicable Lease for such PILOT Property (and, in any such case, Losses shall include lost rental income); provided, that, in each case, the liability with respect to this Section 13.1(a)(xii) shall not exceed the Allocated Loan Amount of the applicable PILOT Property;
(xiii) other than as set forth in Section 13.1(b)(v), a breach by Borrower of any covenant of Article 5 of this Agreement (excluding any provision requiring Borrower to remain solvent, maintain adequate capital or pay its debts as they come due);
(xiv) any liability or obligation of Borrower, Mezzanine A Borrower or Mortgage Borrower relating to the Previously-Owned Property;
(xv) incurrence of liens encumbering any Property, the Mezzanine A Collateral, the Collateral or the direct or indirect interests in Borrower, Mezzanine A Borrower or Mortgage Borrower;
(xvi) any Borrower Party enters into Material Agreements in violation of this Agreement;
(xvii) unsecured indebtedness and indemnification obligations of Mortgage Borrower or Mezzanine A Borrower, in each instance, in contravention of the Loan Documents;
(xviii) if any Affiliate of Borrower purchases all or any part of the Mortgage Loan;
(xix) any obligation of Borrower, Mezzanine A Borrower or Mortgage Borrower (a) to indemnify any Person that, immediately prior to any acquisition of title to the Collateral pursuant to a UCC foreclosure sale, a UCC strict foreclosure, an assignment in lieu of foreclosure or other enforcement action under the Loan Documents (collectively, an “Equity Collateral Enforcement Action”) was an Affiliate of Borrower, Mezzanine A Borrower or Mortgage Borrower, or (b) to pay any amounts due under any contract or agreement between Borrower, Mezzanine A Borrower or Mortgage Borrower, on the one hand, and any Person that, immediately prior to an Equity Collateral Enforcement Action, was an Affiliate of Borrower, Mezzanine A Borrower or Mortgage Borrower, on the other hand; and/or (c) to pay legal fees to any legal counsel engaged by Xxxxxxxx, Mezzanine A Borrower or Mortgage Borrower or any Affiliate of Borrower, Mezzanine A Borrower or Mortgage Borrower prior to the occurrence date of the Event consummation of Default that gave rise to such foreclosure an Equity Collateral Enforcement Action; and/or
(xx) any breach of any representation, warranty or action covenant contained in lieu thereof. Section 10 of the Pledge Agreement.
(b) Notwithstanding anything to the contrary in this Agreement, the Note or any of the Loan Documents Documents, (iA) Lender shall not be deemed to have waived any right which Lender may have under Section 506(a), 506(b), 1111(b) or any other provisions of the U.S. Bankruptcy Code to file a claim for the full amount of the Debt or to require that all collateral shall continue to secure all of the Debt owing to Lender in accordance with the Loan Documents, and (iiB) the Debt shall become be fully recourse to Borrower (but not its members (other than Guarantor solely to the extent provided in the Non-Recourse Guaranty) or other direct or indirect constituent members or partners or any other Person) in the event that: (Ai) the first full Monthly Debt Service Payment Amount (as defined Borrower or any SPE Component Entity or any Affiliate thereof files, or joins in the Note) filing of, a petition against Borrower under the Note is not paid when due; Bankruptcy Code or any other Federal or state bankruptcy or insolvency law, or solicits or causes to be solicited (Bor otherwise colludes with) petitioning creditors for any involuntary petition against Borrower, (ii) Borrower or any SPE Component Entity or any Affiliate thereof files an answer consenting to an involuntary petition filed against Borrower (other than any answer which is required to be made by applicable law), by any other person under the Bankruptcy Code or any other federal or state bankruptcy or insolvency law, (iii) Borrower or any SPE Component Entity consents to or joins in an application for the appointment of a custodian, receiver, trustee, or examiner for Borrower (other than with the prior written consent of Lender), (iv) Borrower makes an assignment for the benefit of creditors (other than to Lender in connection with a default under subsection the Loan or with the prior written consent of Xxxxxx), provided, that, with respect to the Mortgage Loan and Mezzanine A Loan only, (x) the exercise of remedies under the Mortgage Loan, the Mezzanine A Loan or the Loan shall not by itself trigger recourse liability to Borrower or Guarantor, and (y) Guarantor shall not have liability for matters first arising after a foreclosure or assignment-in-lieu of foreclosure of the definition Mortgage Loan, the Mezzanine A Loan or the Loan or for actions taken by Mortgage Lender, Mezzanine A Lender or by Lender pursuant to the exercise of Special any voting proxy or similar rights to exercise control over the Mezzanine A Collateral or the Collateral, except, in each case, to the extent due to the actions of Guarantor or its Affiliates; (v) there is a breach of any provision of Article 5 (Single Purpose Entity Covenants) hereof or the separateness covenants contained in the Borrower’s or SPE Component Entity’s organizational documents (excluding, in each case, any provision requiring Borrower to remain solvent, maintain adequate capital or pay its debts as they come due) and such breach is cited by a court of competent jurisdiction in a final order in a proceeding under the Bankruptcy Remote Entity set forth in Schedule 5 hereto, Borrower fails to maintain its status Code as a Special Purpose Bankruptcy Remote Entity material factor in accordance with the provisions of this Agreement and such failure results in ordering the substantive consolidation of Borrower, Mezzanine A Borrower or Mortgage Borrower with another any other Person; provided that the motion or pleading seeking substantive consolidation was not brought or supported by Lender and, as a result thereof, Borrower is subsequently substantively consolidated in a case under the Bankruptcy Code with any Person other than a co-Borrower under the Loan, (Cvi) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to (a) the transfer or conveyance of all or any subordinate financing portion of any Property, the Mezzanine A Collateral or other voluntary lien encumbering the Property; Collateral, (Db) except as otherwise permitted pursuant to the transfer of any direct or indirect equity interests in Mortgage Borrower, any Mortgage SPE Component Entity, any Mezzanine A Borrower, any Mezzanine A SPE Component Entity, Borrower or any SPE Component Entity, or (c) the granting of any security interest in the direct equity interests in any Mortgage Borrower, any Mortgage SPE Component Entity, any Mezzanine A Borrower or any Mezzanine A SPE Component Entity, in each case in violation of the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any assignment, transfer, or conveyance (vii) violation of covenants regarding opting into Article 8 of the Property or any interest therein as and to the extent required by this Agreement or the Mortgage; or (E) (1) if any petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law, shall be filed by Borrower or Guarantor, or (2) if Borrower or Guarantor files an answer consenting to, or otherwise joining in, any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law filed against it by any other Person, or is found pursuant to a final, unappealable order of a court of competent jurisdiction to have solicited or caused to be solicited creditors to file any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law against Borrower or Guarantor, or (3) if Borrower or Guarantor are found, pursuant to a final unappealable order of a court of competent jurisdiction, to have been in collusion with creditors that initiate a bankruptcy action or proceeding against Borrower or Guarantor or (F) an Event of Default described in Section 8.1(s) hereof shall have occurredUCC.
Appears in 1 contract
Samples: Mezzanine Loan Agreement (Industrial Logistics Properties Trust)
Exculpation. Subject (a) Notwithstanding anything to the qualifications belowcontrary contained in this Note, the Security Instrument or any Other Security Document (but subject to the provisions of subsections (b), (c) and (d) of this Article 11), Lender shall not enforce the liability and obligation of Borrower or its constituent members, partners, shareholders, directors, employees or agents or the direct or indirect constituent members, partners, shareholders, directors, employees or agents thereof (collectively, the “Borrower Parties”) or any other Person, to perform and observe the obligations contained in this Agreement, the Note or any of the other Loan Documents Security Instrument by any action or proceeding wherein a money judgment or any deficiency judgment or other judgment establishing any personal liability shall be sought against Borrower or any principal, director, officer, employee, beneficiary, shareholder, partner, member, trustee, agent or affiliate of Borrower or any person owning, directly or indirectly, any legal or beneficial interest in Borrower, or any successors or assigns of any of the Borrower Parties or any other Personforegoing (collectively, the “Exculpated Parties”), except that Lender may bring a foreclosure action, an action for specific performance or any other appropriate action or proceeding to enable Lender to enforce and realize upon this Note, the Security Instrument, the Other Security Documents, and the interest in the Property, the Rents or (as defined in the Security Instrument) and any other collateral given to Lender pursuant to secure this Agreement and the other Loan DocumentsNote; provided, however, thatsubject to the provisions of subsections (b), except as specifically provided herein(c) and (d) of this Article 11, that any judgment in any such action or proceeding shall be enforceable against the Borrower Parties only to the extent of their Bxxxxxxx’s interest in the Property, in the Rents and in any other collateral given to Lender, and LenderLender to secure this Note. Lxxxxx, by accepting this Agreement, the Note and the other Loan DocumentsSecurity Instrument, agrees that it shall not sxx not, except as otherwise provided in this Article 11, sue for, seek or demand any deficiency judgment against Borrower or any of the Borrower Parties or any other Person Exculpated Parties, in any such action or proceeding proceeding, under or by reason of or under or in connection with this AgreementNote, the Note Security Instrument or any of the other Loan Other Security Documents. The provisions of this paragraph Article 11 shall not, however, (i) constitute a waiver, release or impairment of any obligation evidenced or secured by this AgreementNote, the Note Security Instrument or any of the other Loan DocumentsOther Security Documents delivered to Lender; (ii) impair the right of Lender to name any of the Borrower Parties, as a party defendant in any action or suit for judicial foreclosure and sale under the MortgageSecurity Instrument; (iii) affect the validity or enforceability of any guaranty indemnity, guaranty, master lease or similar instrument made in connection with this Note, the Loan Security Instrument, or any rights and remedies of Lender thereunderthe Other Security Documents; (iv) impair the right of Lender to obtain the appointment of a receiver; (v) impair the enforcement of the Assignment of Leases and RentsRents executed in connection herewith; or (vi) constitute a waiver of impair the right of Lender to enforce the liability and obligation provisions of Section 12.2 of the Security Instrument or of Section 3.12(e) of the Security Instrument; or (vii) impair the right of Lender to obtain a deficiency judgment or other judgment on the Note against Borrower if necessary to fully realize the security granted by the Security Instrument or to commence any other appropriate action or proceeding in order for Lender to exercise its remedies against the Property.
(but not against any members b) Notwithstanding the provisions of Borrower (other than Guarantor this Article 11 to the extent provided contrary, Borrower shall be personally liable to Lender for the Losses (as defined in the Non-Recourse GuarantySecurity Instrument) or their direct or indirect constituent members or partners or any other Person), by money judgment or otherwise, to the extent of any loss, damage, cost, expense, liability, claim or other obligation Lender incurs due to: (but excluding any punitive, consequential or speculative damages) incurred by Lender (including attorneys’ fees and costs reasonably incurred) arising out of or in connection with the following:
(ai) fraud or intentional misrepresentation by Borrower or Guarantor any of the Exculpated Parties in connection with the Loan;
; (b) intentional physical waste of the Property (including, but not limited to, waste due to gross negligence) by Borrower or any affiliate thereof; provided, however, such physical waste shall exclude wear and tear to the Property that occurs in the ordinary course of business of the Property by Borrower or any affiliate thereof;
(cii) the material breach gross negligence or willful misconduct of any representation, warranty, covenant or indemnification provision in the Environmental Indemnity or in this Agreement concerning Environmental Laws, Hazardous Substances and Asbestos;
Borrower; (diii) the removal or disposal by Borrower or any affiliate thereof of any portion of the Property after an Event of Default has occurred and while it is continuingDefault; (iv) Borrower’s misapplication, unless such portion of the Property is replaced by an item of equal or greater value as determined by Lender in its reasonable discretion;
(e) the misapplication misappropriation or conversion of Rents received by Borrower or any affiliate thereof after the occurrence of (i) any insurance proceeds paid by reason of any loss, damage or destruction to the Property, (ii) any awards or other amounts received in connection with the condemnation of all or a portion of the Property, (iii) any Rents following an Event of Default Default; (v) Borrower’s misapplication, misappropriation or (iv) any conversion of tenant security deposits or Rents paid collected more than one (1) month in advance;
(f) failure to pay charges for labor or materials or taxes or other charges that can create liens superior to the lien of the Mortgage on any portion of the Property unless such taxes or other charges are being contested in accordance herewith or such taxes or charges have been delivered to Lender in accordance with Section 3.3 hereof or Borrower has complied with Section 5.2 hereof; and
(g) any security deposits collected by Borrower or any affiliate thereof with respect to the Property advance which are not delivered to Lender upon a foreclosure of the Property or action in lieu thereof, except for application to the extent any such security deposits were applied in accordance with the terms and conditions of any of the Leases prior to the occurrence of the Event of Default that gave rise to such foreclosure or action in lieu thereof. Notwithstanding anything to the contrary in any of the Loan Documents Loan; (i) Lender shall not be deemed to have waived any right which Lender may have under Section 506(a), 506(b), 1111(b) or any other provisions of the U.S. Bankruptcy Code to file a claim for the full amount of the Debt or to require that all collateral shall continue to secure all of the Debt owing to Lender in accordance with the Loan Documents, and (iivi) the Debt shall become fully recourse to Borrower (but not its members (other than Guarantor solely to the extent provided in the Non-Recourse Guaranty) misapplication, misappropriation or other direct conversion of insurance proceeds or indirect constituent members or partners or any other Person) in the event that: (A) the first full Monthly Debt Service Payment Amount (as defined in the Note) under the Note is not paid when duecondemnation awards; (B) other than in connection with a default under subsection (x) of the definition of Special Purpose Bankruptcy Remote Entity set forth in Schedule 5 hereto, Borrower fails to maintain its status as a Special Purpose Bankruptcy Remote Entity in accordance with the provisions of this Agreement and such failure results in the substantive consolidation of Borrower with another Person; (C) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any subordinate financing or other voluntary lien encumbering the Property; (D) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any assignment, transfer, or conveyance of the Property or any interest therein as and to the extent required by this Agreement or the Mortgage; or (E) (1) if any petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law, shall be filed by Borrower or Guarantor, or (2) if Borrower or Guarantor files an answer consenting to, or otherwise joining in, any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law filed against it by any other Person, or is found pursuant to a final, unappealable order of a court of competent jurisdiction to have solicited or caused to be solicited creditors to file any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law against Borrower or Guarantor, or (3) if Borrower or Guarantor are found, pursuant to a final unappealable order of a court of competent jurisdiction, to have been in collusion with creditors that initiate a bankruptcy action or proceeding against Borrower or Guarantor or (F) an Event of Default described in Section 8.1(s) hereof shall have occurred.vii)
Appears in 1 contract
Samples: Promissory Note (AmREIT Monthly Income & Growth Fund III LTD)
Exculpation. Subject Except as otherwise set forth in this Section 8.14 and Section 4.2 to the qualifications belowcontrary, Lender shall not enforce the liability and obligation of any Borrower or its constituent members, partners, shareholders, directors, employees or agents or the direct or indirect constituent members, partners, shareholders, directors, employees or agents thereof (collectively, the “Borrower Parties”) or any other Person, Operating Lessee to perform and observe the obligations contained in this Agreement, the Note Note, any Mortgage or any of the other Loan Documents executed and delivered by any action Borrower or proceeding wherein a money judgment shall be sought against any of the Borrower Parties or any other Person, Operating Lessee except that Lender may pursue any power of sale, bring a foreclosure action, an action for specific performance performance, action for money judgment, or any other appropriate action or proceeding (including, without limitation, to enable obtain a deficiency judgment) against any or all Borrowers, or Operating Lessee or any other Person solely for the purpose of enabling Lender to enforce and realize upon (a) any Collateral, and (b) any Rents to the Propertyextent (x) received by any Borrower or any Manager (or any of their affiliates), after the occurrence of an Event of Default or (y) distributed to any Borrower, Operating Lessee or any Manager, or their respective shareholders, or partners or members, as applicable, or affiliates during or with respect to any period for which Lender did not receive the full amounts it was entitled to receive as prepayments of the Loan pursuant to Section 2.6(b) (all Rents or covered by clauses (x) and (y) being hereinafter referred to as the “Recourse Distributions”) and (c) any other collateral given to Lender pursuant to this Agreement under the Loan Documents ((a), (b), and (c) collectively, the other Loan Documents“Default Collateral”); provided, however, that, except as specifically provided herein, that any judgment in any such action or proceeding shall be enforceable against the Borrower Parties only to the extent of their interest in any Default Collateral. The provisions of this Section 8.14 shall not, however, (a) impair the Property, validity of the Rents and Indebtedness evidenced by the Loan Documents or in any other collateral given to Lender, and Lender, by accepting this Agreement, way affect or impair the Note and the other Loan Documents, agrees that it shall not sxx for, seek or demand Liens of any deficiency judgment against any of the Borrower Parties or any other Person in any such action or proceeding under or by reason of or in connection with this Agreement, the Note Mortgage or any of the other Loan Documents. The provisions Documents or the right of this paragraph shall not, however, (i) constitute a waiver, release or impairment Lender to foreclose any Mortgage following an Event of any obligation evidenced or secured by this Agreement, the Note or any of the other Loan DocumentsDefault; (iib) impair the right of Lender to name any of the Borrower Parties, Person as a party defendant in any action or suit for judicial foreclosure and sale under the any Mortgage; (iiic) affect the validity or enforceability of the Note, any guaranty made in connection with Mortgage or the other Loan or any rights and remedies of Lender thereunderDocuments; (ivd) impair the right of Lender to obtain the appointment of a receiver; (ve) impair the enforcement of the Assignment of Leases and Rents; or (vi) constitute a waiver of the right of Lender to enforce the liability bring suit for and obligation of Borrower (but not recover against any members Person any damages, losses, expenses, liabilities or costs resulting from fraud, willful misrepresentation, waste of Borrower (other than Guarantor to the extent provided in the Non-Recourse Guaranty) or their direct or indirect constituent members or partners all or any other Person), by money judgment or otherwise, to the extent portion of any lossIndividual Property, damage, cost, expense, liability, claim or other obligation (but excluding wrongful removal or disposal of all or any punitive, consequential or speculative damages) incurred portion of any Individual Property by Lender (including attorneys’ fees and costs reasonably incurred) arising out of or any Person in connection with this Agreement, the following:
Note, any Mortgage or the other Loan Documents; (af) fraud impair the right of Lender to obtain the Recourse Distributions received by any Person; (g) impair the right of Lender to bring suit for and recover against any Person with respect to any misappropriation of security deposits or intentional misrepresentation by Borrower or Guarantor in connection with the Loan;
(b) intentional physical waste of the Property (including, but not limited to, waste due to gross negligence) by Borrower or any affiliate thereof; provided, however, such physical waste shall exclude wear and tear to the Property that occurs in the ordinary course of business of the Property by Borrower or any affiliate thereof;
(c) the material breach of any representation, warranty, covenant or indemnification provision in the Environmental Indemnity or in this Agreement concerning Environmental Laws, Hazardous Substances and Asbestos;
(d) the removal or disposal by Borrower or any affiliate thereof of any portion of the Property after an Event of Default has occurred and while it is continuing, unless such portion of the Property is replaced by an item of equal or greater value as determined by Lender in its reasonable discretion;
(e) the misapplication or conversion by Borrower or any affiliate thereof of (i) any insurance proceeds paid by reason of any loss, damage or destruction to the Property, (ii) any awards or other amounts received in connection with the condemnation of all or a portion of the Property, (iii) any Rents following an Event of Default or (iv) any Rents paid collected more than one (1) month in advance;
; (fh) failure impair the right of Lender to pay charges for labor obtain Insurance Proceeds or materials Condemnation Proceeds due to Lender pursuant to any Mortgage; (i) impair the right of Lender to enforce the provisions of Sections 4.1(v) or taxes 5.1(d) through 5.1(g), inclusive of this Agreement, Section 2.8 of each Mortgage or the Environmental Guaranty even after repayment in full by any Borrower of the Indebtedness; (j) prevent or in any way hinder Lender from exercising, or constitute a defense, or counterclaim, or other charges that can create liens superior to the lien basis for relief in respect of the Mortgage exercise of, any other remedy against any or all of the Collateral securing the Note as provided in the Loan Documents; (k) impair the right of Lender to bring suit for and recover against any person with respect to any misapplication of any funds (including, without limitation, insurance proceeds and condemnation proceeds); (l) impair the right of Lender to sxx for, seek or demand a deficiency judgment against any Person solely for the purpose of foreclosing on any portion Collateral or any part thereof, or realizing upon the Default Collateral, (m) impair the right of Lender to bring suit for and recover against any Person any damages, losses, expenses, liabilities or costs in the Property unless such taxes or other charges are being contested in accordance herewith or such taxes or charges have been delivered to Lender in accordance with Section 3.3 hereof or Borrower has complied with Section 5.2 hereof; and
(g) any security deposits collected by event that Borrower or any affiliate Operating Lessee shall take any action of any kind or nature whatsoever, either directly or indirectly to oppose, impede, obstruct, challenge, hinder, frustrate, enjoin or otherwise interfere with (A) Lender’s termination of any Operating Lease with any Operating Lessee, (B) Lender or the party acquiring any Individual Property following the occurrence of a foreclosure or deed in lieu thereof with respect (in full substitution of the applicable Operating Lessee) being deemed the “Owner” under the Management Agreement, (C) the execution, delivery or effectiveness of a new Management Agreement directly between Lender or the party acquiring any Individual Property following a foreclosure or deed in lieu thereof and applicable Manager or (D) any payment or other transfer by any Manager of funds which would otherwise be paid to the Property which are not delivered any Operating Lessee under any Operating Lease directly to Lender upon or the party acquiring any Individual Property following the occurrence of a foreclosure of the Property or action deed in lieu thereof, except in each case after or as a result of any automatic termination of the applicable Operating Lease or of Lender exercising its right to terminate the Operating Lease, in each case pursuant to the applicable Subordination, Attornment and Security Agreement and this Agreement, or shall, either directly or indirectly, cause or permit any other person to take any action which, if taken by such Operating Lessee would constitute an event described in this Section 8.14(m), or (n) impair the right of Lender to bring suit for and recover against any Person with respect to any breach of Section 9(b) of any Collection Account Agreement (the foregoing clauses (a) through (n) each, a “Recourse Liability” and collectively, the “Recourse Liabilities”); provided, however, that any deficiency judgment referred to in this Section 8.14(m) shall be enforceable only to the extent any such security deposits were applied in accordance with the terms and conditions of any of the Leases prior Default Collateral. The preceding provisions of this Section shall be inapplicable to any Person and the occurrence Indebtedness shall be fully recourse to Borrowers in the event that one or more of the Event of Default that gave rise to such foreclosure or action in lieu thereof. Notwithstanding anything to the contrary in any of the Loan Documents following occurs (each, a “Full Recourse Event”): (i) Lender shall not be deemed to have waived any right which Lender may have under Section 506(a), 506(b), 1111(b) or any other provisions of the U.S. Bankruptcy Code to file a claim for the full amount of the Debt or to require that all collateral shall continue to secure all of the Debt owing to Lender in accordance with the Loan Documents, and (ii) the Debt shall become fully recourse to Borrower (but not its members (other than Guarantor solely to the extent provided in the Non-Recourse Guaranty) or other direct or indirect constituent members or partners or any other Person) in the event that: (A) the first full Monthly Debt Service Payment Amount (as defined in the Note) under the Note is not paid when due; (B) other than in connection with a default under subsection (x) of the definition of Special Purpose Bankruptcy Remote Entity set forth in Schedule 5 hereto, Borrower fails to maintain its status as a Special Purpose Bankruptcy Remote Entity in accordance with the provisions of this Agreement and such failure results in the substantive consolidation of Borrower with another Person; (C) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any subordinate financing or other voluntary lien encumbering the Property; (D) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any assignment, transfer, or conveyance of the Property or any interest therein as and to the extent required by this Agreement or the Mortgage; or (E) (1) if any petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law, law against any Borrower or Operating Lessee shall be filed by Borrower or Guarantorany Borrower, or (2) if Borrower or Guarantor files an answer consenting to, or otherwise joining in, any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy lawOperating Lessee, or any similar federal Affiliate of any Borrower or state law filed Operating Lessee, (ii) if an involuntary bankruptcy or other insolvency proceeding is commenced against it any Borrower or Operating Lessee (by a party other than Lender) but only if such Borrower has consented or acquiesced to such proceeding or if Borrower, Operating Lessee or any other PersonAffiliate of Borrower or Operating Lessee has acted in concert with, colluded or is found pursuant conspired with the party to cause the filing thereof or has consented to or acquiesced thereto, (iii) if any Borrower or Operating Lessee shall institute any proceeding for the dissolution or liquidation of any Borrower or Operating Lessee, (iv) if any Borrower or Operating Lessee shall make an assignment for the benefit of creditors, (v) if any Borrower or Operating Lessee shall breach any representation, warranty or covenant in Section 2.14, Section 4.1(c) (such that such breach was considered by a final, unappealable order court as a factor in the court’s finding for a consolidation of the assets of a court Borrower or Operating Lessee with the assets of competent jurisdiction to have solicited another person or caused to entity or as a result thereof Lender suffers any material damage, cost, liability or expense; provided, however, that in the absence of an actual consolidation, recourse may be solicited creditors to file any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law had against Borrower or GuarantorOperating Lessee only to the extent of losses for such breach), or 4.1(v), 4.1(aa), 5.1(r) (3) if such that such breach was considered by a court as a factor in the court’s finding for a consolidation of the assets of a Borrower or Guarantor are foundOperating Lessee with the assets of another person or entity or as a result thereof Lender suffers any material damage, pursuant to a final unappealable order cost, liability or expense; provided, however, that in the absence of a court of competent jurisdictionan actual consolidation, to have been in collusion with creditors that initiate a bankruptcy action or proceeding recourse may be had against Borrower or Guarantor Operating Lessee only to the extent of losses for such breach), or 5.1(v), (v) if any Borrower or Operating Lessee allows any Transfer to occur in violation of Section 6.1(b) hereof or otherwise fails to obtain Lender’s prior written consent to any Transfer to the extent any consent is required in the Loan Document, (vii) any Borrower or Operating Lessee interferes with Lender’s exercise of any of its rights or remedies hereunder or (Fviii) an Event of Default described if any Borrower or Operating Lessee breaches any representation or warranty contained in Section 8.1(s) hereof shall have occurred4.1(s).
Appears in 1 contract
Exculpation. (a) Subject to the qualifications below, Lender shall not enforce the liability and obligation of Borrower or its constituent members, partners, shareholders, directors, employees or agents or the direct or indirect constituent members, partners, shareholders, directors, employees or agents thereof (collectively, the “Borrower Parties”) or any other Person, to perform and observe the obligations contained in the Note, this Agreement, the Note Security Instrument or any of the other Loan Documents by any action or proceeding wherein a money judgment or any deficiency judgment or other judgment establishing personal liability shall be sought against Borrower or any principal, director, officer, employee, beneficiary, shareholder, partner, member, trustee, agent, or Affiliate of Borrower (but specifically excluding Guarantor with respect to its obligations set forth in the Guaranty and the Environmental Indemnity) or any legal representatives, successors or assigns of any of the Borrower Parties or any other Personforegoing (collectively, the “Exculpated Parties”), except that Lender may bring a foreclosure action, an action for specific performance or any other appropriate action or proceeding to enable Lender to enforce and realize upon its interest under the Note, this Agreement, the Security Instrument and the other Loan Documents, or in the Property, the Rents Rents, or any other collateral given to Lender pursuant to this Agreement and the other Loan Documents; provided, however, that, except as specifically provided herein, any judgment in any such action or proceeding shall be enforceable against the Borrower Parties only to the extent of their Borrower’s interest in the Property, in the Rents and in any other collateral given to Lender, and Lender, by accepting the Note, this Agreement, the Note Security Instrument and the other Loan Documents, agrees that it shall not sxx xxx for, seek or demand any deficiency judgment against Borrower or any of the Borrower Exculpated Parties or any other Person in any such action or proceeding under or by reason of or under or in connection with the Note, this Agreement, the Note Security Instrument or any of the other Loan Documents. The provisions of this paragraph Section shall not, however, (i1) constitute a waiver, release or impairment of any obligation evidenced or secured by this Agreement, the Note or any of the other Loan Documents; (ii2) impair the right of Lender to name any of the Borrower Parties, as a party defendant in any action or suit for foreclosure and sale under the MortgageSecurity Instrument; (iii3) affect the validity or enforceability of any indemnity, guaranty or similar instrument (including, without limitation, the indemnities set forth in Article 12 hereof, Section 11.2 hereof, in the Guaranty and in the Environmental Indemnity) made in connection with the Loan or any of the rights and remedies of Lender thereunderthereunder (including, without limitation, Lender’s right to enforce said rights and remedies against Borrower and/or Guarantor (as applicable) personally and without the effect of the exculpatory provisions of this Article 13); (iv4) impair the right of Lender to obtain the appointment of a receiver; (v5) impair the enforcement of the Assignment assignment of Leases leases and Rentsrents contained in the Security Instrument; (6) impair the right of Lender to enforce Section 4.12(e) of this Agreement; (7) constitute a prohibition against Lender to seek a deficiency judgment against Borrower in order to fully realize the security granted by the Security Instrument or to commence any other appropriate action or proceeding in order for Lender to exercise its remedies against the Property; or (vi) 8) constitute a waiver of the right of Lender to enforce the liability and obligation of Borrower (but not against any members of Borrower (other than Guarantor to the extent provided in the Non-Recourse Guaranty) or their direct or indirect constituent members or partners or any other Person)Borrower, by money judgment or otherwise, to the extent of any loss, damage, cost, expense, liability, claim or other obligation (but excluding any punitive, consequential or speculative damages) Losses incurred by Lender (including attorneys’ fees and costs reasonably incurred) arising out of or in connection with any of the following:
(ai) fraud or intentional misrepresentation or any failure to disclose a material fact by Borrower, any SPE Component Entity, Guarantor, or any Borrower or Guarantor Party in connection with the Loan, to the extent such fact is known by Borrower, any SPE Component Entity, Guarantor or any Borrower Party;
(bii) intentional the gross negligence or willful misconduct of Borrower, any SPE Component Entity, Guarantor, or any Borrower Party or the commission of a criminal act by Borrower, any SPE Component Entity, Guarantor or any Borrower Party which results in any seizure or forfeiture of the Property, or any portion thereof, or Borrower’s interest therein;
(iii) material physical waste of to the Property caused by the intentional acts or intentional omissions of Borrower, any SPE Component Entity, Guarantor, or any Borrower Party (including, but not limited towithout limitation, waste due to gross negligence) by Borrower any arson or any affiliate thereof; provided, however, such physical waste shall exclude wear and tear to the Property that occurs in the ordinary course of business abandonment of the Property by Borrower or any affiliate thereof;
(cProperty) the material breach of any representation, warranty, covenant or indemnification provision in the Environmental Indemnity or in this Agreement concerning Environmental Laws, Hazardous Substances and Asbestos;
(d) and/or the removal or disposal by Borrower or any affiliate thereof of any portion of the Property after an Event of Default has occurred and while by Borrower, any SPE Component Entity, Guarantor or any Borrower Party, provided it is continuing, unless such portion of shall not be considered waste if Borrower fails to maintain the Property is replaced by an item of equal or greater value as determined by Lender in its reasonable discretiondue solely to insufficient revenue from the Property;
(eiv) the misapplication misapplication, misappropriation or conversion by Borrower or any affiliate thereof of (iA) any insurance proceeds paid by reason of any loss, damage or destruction to the Property, (iiB) any awards Awards or other amounts received in connection with the condemnation Condemnation of all or a portion of the Property, (iiiC) any Rents following an upon and during a continuing Event of Default or (ivD) any Tenant security deposits or Rents paid more than one (1) month collected in advance;
(fv) failure to pay any Taxes or Other Charges, charges for labor or materials or taxes or any other charges that can create liens superior to the lien of the Mortgage on any portion of the Property unless such taxes or other charges are being contested in accordance herewith or such taxes or charges have been delivered to Lender in accordance with Section 3.3 hereof or Borrower has complied with Section 5.2 hereof; and
(g) any security deposits collected by Borrower or any affiliate thereof with respect to the Property which are not delivered to Lender upon a foreclosure of the Property or action in lieu thereof, except to the extent any that the revenue from the Property is sufficient to pay such security deposits were applied amounts (other than (x) amounts deposited with Lender as Tax Reserve Funds for Taxes or Other Charges where Lender elects not to apply such funds toward payment of such Taxes or Other Charges owed, (y) Taxes or Other Charges owed that are contested strictly in accordance with the terms of the Loan Documents or (z) Taxes or Other Charges that first arise and conditions accrue from and after the date that Lender acquires title to the Property, whether by foreclosure, deed-in-lieu of foreclosure or other comparable conversion of the Security Instrument following an Event of Default);
(vi) failure to maintain insurance as required by this Agreement to the extent that the revenue from the Property is sufficient to pay the Insurance Premiums relating thereto (other than the failure to pay amounts deposited with Lender as Insurance Reserve Funds for Insurance Premiums to be paid to maintain such insurance where Lender elects not to apply such funds toward payment of such Insurance Premiums), provided Borrower shall not be liable for premiums that first arise and accrue from and after the date that Lender acquires title to the Property, whether by foreclosure, deed-in-lieu of foreclosure or other comparable conversion of the Security Instrument following an Event of Default;
(vii) the breach of any of representation, warranty, covenant or indemnification provision in the Leases prior to Environmental Indemnity, this Agreement or in the Security Instrument concerning Environmental Laws and Hazardous Substances;
(viii) any fees or commissions paid by Borrower after the occurrence of the any Event of Default to Guarantor and/or any Affiliate of Borrower and/or Guarantor in violation of the terms of the Note, this Agreement, the Security Instrument or the other Loan Documents;
(ix) Borrower’s breach of, or failure to comply with, the representations, warranties and covenants contained in Article 15 of this Agreement and/or the provisions of Sections 11.2, 12.2 and 12.3 hereof;
(x) any representation, warranty or covenant contained in Article 5 hereof is violated or breached; and/or
(xi) any litigation or other legal proceeding related to the Debt filed by Borrower, any SPE Component Entity, Guarantor or any Borrower Party in bad faith or frivolously that gave rise delays, opposes, impedes, obstructs, hinders, enjoins or otherwise interferes with or frustrates the efforts of Lender to such foreclosure or action exercise any rights and remedies available to Lender as provided herein and in lieu thereofthe other Loan Documents. Notwithstanding anything to the contrary in this Agreement, the Note or any of the Loan Documents Documents, (iA) Lender shall not be deemed to have waived any right which Lender may have under Section 506(a), 506(b), 1111(b) or any other provisions of the U.S. Bankruptcy Code to file a claim for the full amount of the Debt or to require that all collateral shall continue to secure all of the Debt owing to Lender in accordance with the Loan Documents, and (iiB) the Debt shall become be fully recourse to Borrower (but not its members (other than Guarantor solely to the extent provided in the Non-Recourse Guaranty) or other direct or indirect constituent members or partners or any other Person) in the event that: (Ai) the first full Monthly Debt Service Payment Amount any representation, warranty or covenant contained in Article 5 hereof is violated or breached, provided, however, that any such breach or violation with respect to Article 5 shall not result in recourse liability hereunder unless such breach was material and, within fifteen (as defined in the Note15) under the Note is not paid when due; (B) other than in connection with a default under subsection (x) days of the definition of Special Purpose Bankruptcy Remote Entity set forth in Schedule 5 heretonotice from any source whatsoever, Borrower fails to maintain its status as a Special Purpose Bankruptcy Remote Entity in accordance with cure such breach and then only to the provisions of this Agreement and extent that such failure breach results in the substantive consolidation of the assets and liabilities of Borrower with another any other Person as a result of such breach; (ii) if any Sale or Pledge occurs that is not a Permitted Transfer; (iii) Borrower or any SPE Component Entity files a voluntary petition under the Bankruptcy Code or any other Creditors Rights Laws; (iv) unless sought by Lender, an Affiliate, officer, director, or representative which Controls, directly or indirectly, Borrower or any SPE Component Entity files, or joins in the filing of, an involuntary petition against Borrower or any SPE Component Entity under the Bankruptcy Code or any other Creditors Rights Laws, or solicits or causes to be solicited petitioning creditors for any involuntary petition against Borrower or any SPE Component Entity from any Person; (Cv) except unless sought by Lender, Borrower or any SPE Component Entity files an answer consenting to or otherwise acquiescing in or joining in any involuntary petition filed against it, by any other Person under the Bankruptcy Code or any other Creditors Rights Laws, or solicits or causes to be solicited petitioning creditors for any involuntary petition from any Person; (vi) unless sought by Lender, any Affiliate, officer, director, or representative which Controls Borrower or any SPE Component Entity consents to or acquiesces in or joins in an application for the appointment of a custodian, receiver, trustee, or examiner for Borrower, any SPE Component Entity or any portion of the Property; (vii) unless sought by Lender, Borrower or any SPE Component Entity makes an assignment for the benefit of creditors or admits in any legal proceeding its insolvency or inability to pay its debts as otherwise permitted pursuant they become due; (viii) there is substantive consolidation of Borrower or any SPE Component Entity (or any Restricted Party) with any other Person in connection with any federal or state bankruptcy proceeding involving the Guarantor or any of its Affiliates; (ix) Borrower or any SPE Component Entity (or any Restricted Party) contests or opposes any motion made by Lender to obtain relief from the Loan Documentsautomatic stay or seeks to reinstate the automatic stay in the event of any federal or state bankruptcy or insolvency proceeding involving the Guarantor or its Affiliates; (x) if following thirty (30) days written notice, Borrower fails to obtain Lender’s prior written consent comply with the Cash Management Agreement relating to any subordinate financing the establishment of a Deposit Account or other voluntary lien encumbering the PropertyCash Management Account until such accounts shall have been established; (D) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any assignment, transfer, or conveyance of the Property or any interest therein as and to the extent required by this Agreement or the Mortgage; or (E) (1) if any petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law, shall be filed by Borrower or Guarantor, or (2xi) if Borrower or Guarantor files shall have failed to satisfy the Xxxxxx Xxxxxx Condemnation Requirements in accordance with Section 2.7 hereof, in an answer consenting to, or otherwise joining in, any involuntary petition for bankruptcy, reorganization or arrangement pursuant amount equal to federal bankruptcy law, or any similar federal or state law filed against it by any other Person, or is found pursuant the then outstanding Allocated Loan Amount of the Xxxxxx Xxxxxx Property (after deducting the Net Proceeds payable and paid to a final, unappealable order of a court of competent jurisdiction Lender relating to have solicited or caused to be solicited creditors to file any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law against Borrower or Guarantor, such Condemnation) until such time as the Xxxxxx Xxxxxx Condemnation Requirements are satisfied or (3xii) if Borrower or Guarantor are found, pursuant to a final unappealable order of a court of competent jurisdiction, to have been in collusion with creditors that initiate a bankruptcy action or proceeding against Borrower or Guarantor or (F) an Event of Default described in Section 8.1(s) hereof shall have occurredfailed to satisfy the Lowe’s Casualty Requirements in accordance with Section 2.7 hereof, in an amount equal to the then outstanding Allocated Loan Amount of the Lowe’s Property (after deducting the Net Proceeds payable and paid to Lender relating to such Casualty) until such time as the Lowe’s Casualty Requirements are satisfied.
Appears in 1 contract
Exculpation. Subject to the qualifications below, Lender shall not enforce the liability and obligation of Borrower or its constituent members, partners, shareholders, directors, employees or agents or the direct or indirect constituent members, partners, shareholders, directors, employees or agents thereof (collectively, the “Borrower Parties”) or any other Person, to perform and observe the obligations contained in this Agreement, the Note or any of the other Loan Documents by any action or proceeding wherein a money judgment shall be sought against any of the Borrower Parties or any other Person, except that Lender may bring a foreclosure action, an action for specific performance or any other appropriate action or proceeding to enable Lender to enforce and realize upon the Property, the Rents or any other collateral given to Lender pursuant to this Agreement and the other Loan Documents; provided, however, that, except as specifically provided herein, any judgment in any such action or proceeding shall be enforceable against the Borrower Parties only to the extent of their interest in the Property, the Rents and in any other collateral given to Lender, and Lender, by accepting this Agreement, the Note and the other Loan Documents, agrees that it shall not sxx for, seek or demand any deficiency judgment against any of the Borrower Parties or any other Person in any such action or proceeding under or by reason of or in connection with this Agreement, the Note or any of the other Loan Documents. The provisions of this paragraph shall not, however, (i) constitute a waiver, release or impairment of any obligation evidenced or secured by this Agreement, the Note or any of the other Loan Documents; (ii) impair the right of Lender to name any of the Borrower Parties, as a party defendant in any action or suit for foreclosure and sale under the Mortgage; (iii) affect the validity or enforceability of any guaranty made in connection with the Loan or any rights and remedies of Lender thereunder; (iv) impair the right of Lender to obtain the appointment of a receiver; (v) impair the enforcement of the Assignment of Leases and Rents; or (vi) constitute a waiver of the right of Lender to enforce the liability and obligation of Borrower (but not against any members of Borrower (other than Guarantor to the extent provided in the Non-Recourse Guaranty) or their direct or indirect constituent members or partners or any other Person), by money judgment or otherwise, to the extent of any loss, damage, cost, expense, liability, claim or other obligation (but excluding any punitive, consequential or speculative damages) incurred by Lender (including attorneys’ fees and costs reasonably incurred) arising out of or in connection with the following:
(a) fraud or intentional misrepresentation by Borrower or Guarantor in connection with the Loan;
(b) intentional physical waste of the Property (including, but not limited to, waste due to gross negligence) by Borrower or any affiliate thereof; provided, however, such physical waste shall exclude wear and tear to the Property that occurs in the ordinary course of business of the Property by Borrower or any affiliate thereof;
(c) the material breach of any representation, warranty, covenant or indemnification provision in the Environmental Indemnity or in this Agreement concerning Environmental Laws, Hazardous Substances and or Asbestos;
(d) the removal or disposal by Borrower or any affiliate thereof of any portion of the Property after an Event of Default has occurred and while it is continuing, unless such portion of the Property is replaced by an item of equal or greater value as determined by Lender in its reasonable discretion;
(e) the misapplication or conversion by Borrower or any affiliate thereof of (i) any insurance proceeds paid by reason of any loss, damage or destruction to the Property, (ii) any awards or other amounts received in connection with the condemnation of all or a portion of the Property, (iii) any Rents following an Event of Default or (iv) any Rents paid more than one (1) month in advance;
(f) failure to pay charges for labor or materials or taxes or other charges that can create liens superior to the lien of the Mortgage on any portion of the Property unless such taxes or other charges are being contested in accordance herewith or such taxes or charges have been delivered to Lender in accordance with Section 3.3 hereof or Borrower has complied with Section 5.2 hereof; and
(g) any security deposits collected by Borrower or any affiliate thereof with respect to the Property which are not delivered to Lender upon a foreclosure of the Property or action in lieu thereof, except to the extent any such security deposits were applied in accordance with the terms and conditions of any of the Leases prior to the occurrence of the Event of Default that gave rise to such foreclosure or action in lieu thereof. Notwithstanding anything to the contrary in any of the Loan Documents (i) Lender shall not be deemed to have waived any right which Lender may have under Section 506(a), 506(b), 1111(b) or any other provisions of the U.S. Bankruptcy Code to file a claim for the full amount of the Debt or to require that all collateral shall continue to secure all of the Debt owing to Lender in accordance with the Loan Documents, and (ii) the Debt shall become fully recourse to Borrower (but not its members (other than Guarantor solely to the extent provided in the Non-Recourse Guaranty) or other direct or indirect constituent members or partners or any other Person) in the event that: (A) the first full Monthly Debt Service Payment Amount (as defined in the Note) under the Note is not paid when due; (B) other than in connection with a default under subsection (x) of the definition of Special Purpose Bankruptcy Remote Entity set forth in Schedule 5 hereto, Borrower fails to maintain its status as a Special Purpose Bankruptcy Remote Entity in accordance with the provisions of this Agreement and such failure results in the substantive consolidation of Borrower with another Person; (C) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any subordinate financing or other voluntary lien encumbering the Property; (D) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any assignment, transfer, or conveyance of the Property or any interest therein as and to the extent required by this Agreement or the Mortgage; or (E) .
(1) if any petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law, shall be filed by Borrower or Guarantor, or (2) if Borrower or Guarantor files an answer consenting to, or otherwise joining in, any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law filed against it by any other Person, or is found pursuant to a final, unappealable order of a court of competent jurisdiction to have solicited or caused to be solicited creditors to file any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law against Borrower or Guarantor, or (3) if Borrower or Guarantor are found, pursuant to a final unappealable order of a court of competent jurisdiction, to have been in collusion with creditors that initiate a bankruptcy action or proceeding against Borrower or Guarantor or (F) an Event of Default described in Section 8.1(s) hereof shall have occurred.
Appears in 1 contract
Exculpation. Subject (a) Notwithstanding anything to the contrary herein or in any of the other Loan Documents but subject to the qualifications below, Lender shall not enforce the liability and obligation of Borrower or its constituent members, partners, shareholders, directors, employees or agents or the direct or indirect constituent members, partners, shareholders, directors, employees or agents thereof (collectively, the “Borrower Parties”) or any other Person, to perform and observe the obligations contained in the Note, this Agreement, the Note Security Instrument or any of the other Loan Documents by any action or proceeding wherein a money judgment or any deficiency judgment or other judgment establishing personal liability shall be sought against Borrower or any principal, director, officer, employee, beneficiary, shareholder, partner, member, manager, trustee, agent, or Affiliate of Borrower (but specifically excluding Guarantor subject to the terms of the Guaranty) or any legal representatives, successors or assigns of any of the Borrower Parties or any other Personforegoing (collectively, the “Exculpated Parties”), except that Lender may bring a foreclosure action, an action for specific performance or any other appropriate action or proceeding to enable Lender to enforce and realize upon its interest under the Note, this Agreement, the Security Instrument and the other Loan Documents, or in the Property, the Rents Rents, or any other collateral given to Lender pursuant to this Agreement and the other Loan Documents; provided, however, that, except as specifically provided herein, any judgment in any such action or proceeding shall be enforceable against the Borrower Parties only to the extent of their Borrower's interest in the Property, in the Rents and in any other collateral given to Lender, and Lender, by accepting the Note, this Agreement, the Note Security Instrument and the other Loan Documents, agrees that it shall not sxx xxx for, seek or demand any deficiency judgment against Borrower or any of the Borrower Exculpated Parties or any other Person in any such action or proceeding under or by reason of or under or in connection with the Note, this Agreement, the Note Security Instrument or any of the other Loan Documents. The provisions of this paragraph Section shall not, however, (i1) constitute a waiver, release or impairment of any obligation evidenced or secured by this Agreement, the Note or any of the other Loan Documents; (ii2) impair the right of Lender to name any of the Borrower Parties, as a party defendant in any action or suit for foreclosure and sale under the MortgageSecurity Instrument; (iii3) affect the validity or enforceability of any separate written indemnity or guaranty (including, without limitation, the Guaranty) made in connection with the Loan or any of the rights and remedies of Lender thereunderthereunder (including, without limitation, Lender's right to enforce said rights and remedies against Borrower and/or Guarantor (as applicable) personally in such separate written indemnity or guaranty and without the effect of the exculpatory provisions of this Article 13); (iv4) impair the right of Lender to obtain the appointment of a receiver; (v5) impair the enforcement of the Assignment assignment of Leases leases and Rentsrents contained in the Security Instrument; (6) intentionally omitted; (7) constitute a prohibition against Lender seeking a deficiency judgment against Borrower in order to fully realize the security granted by the Security Instrument (but not to impose personal liability upon Borrower contrary to this Section 13.1) or to commence any other appropriate action or proceeding in order for Lender to exercise its remedies against the Property; or (vi) 8) constitute a waiver of the right of Lender to enforce the liability and obligation of Borrower (but not against any members of Borrower (other than Guarantor to the extent provided in the Non-Recourse Guaranty) or their direct or indirect constituent members or partners or any other Person)Borrower, by money judgment or otherwise, to the extent of any loss, damage, cost, expense, liability, claim or other obligation (but excluding any punitive, consequential or speculative damages) Losses incurred by Lender (including attorneys’ ' fees and costs reasonably incurred) directly arising out of or in connection with caused by the following:
(ai) fraud or intentional willful misrepresentation by Borrower Borrower, any SPE Component Entity, any of the Exculpated Parties or Guarantor in connection with the Loan;
(bii) intentional the gross negligence or willful misconduct of Borrower, any SPE Component Entity, any of the Exculpated Parties or Guarantor;
(iii) material physical waste of to the Property (including, but not limited to, waste due to gross negligence) by Borrower or any affiliate portion thereof; provided) caused by the intentional acts or intentional omissions of Borrower, howeverany SPE Component Entity, such physical waste shall exclude wear and tear to the Property that occurs in the ordinary course of business any of the Property by Borrower Exculpated Parties or any affiliate thereofGuarantor;
(c) the material breach of any representation, warranty, covenant or indemnification provision in the Environmental Indemnity or in this Agreement concerning Environmental Laws, Hazardous Substances and Asbestos;
(div) the removal or disposal by Borrower or any affiliate thereof of any portion of the Property by Borrower, any SPE Component Entity, any of the Exculpated Parties or Guarantor after an Event of Default has occurred unless replaced with property of similar utility and while it is continuing, unless such of equal or better value than the portion of the Property is replaced by an item of equal so removed or greater value disposed of, as determined by Lender in its reasonable discretionjudgment;
(ev) the misapplication misapplication, misappropriation or conversion by Borrower or any affiliate thereof of (iA) any insurance proceeds paid by reason of any loss, damage or destruction Casualty to the PropertyProperty (or any portion thereof), or (iiB) any awards Awards or other amounts received in connection with the condemnation Condemnation of all or a portion of the Property, which such proceeds or Award are received by Borrower and not applied as required hereunder or under the other Loan Documents;
(iiivi) the misapplication, misappropriation or conversion by Borrower of any Rents following during the continuance of an Event of Default Default, which are received by Borrower and not applied by Borrower to the payment of either (i) normal and necessary Operating Expenses or (ivii) any Rents paid more than one (1) month in advancethe Debt;
(fvii) failure by Borrower to pay charges for labor pay, or materials cause to be paid, prior to delinquency any Taxes or taxes or other charges that can Other Charges if non-payment of the same would create liens superior senior to the lien of the Mortgage Security Instrument on all or any portion of the Property, but only to the extent the Property unless generates sufficient revenue for the immediately preceding twelve (12) month period (or, if applicable, such taxes or other charges are being contested in accordance herewith or such taxes or charges have been delivered to Lender in accordance with Section 3.3 hereof or shorter period that Borrower has complied with Section 5.2 hereof; andowned each the Property) to pay the same;
(gviii) the failure of Borrower to deliver any security deposits, advance deposits or any other deposits collected by Borrower or any affiliate thereof with respect to the Property which are not delivered to Lender Lender, upon a foreclosure of the Property (or any portion thereof) or action in lieu thereof, except to the extent any such security deposits were applied in accordance with the terms and conditions of any of the Leases prior to the occurrence of the Event of Default that gave rise to such foreclosure or action in lieu thereof. ;
(ix) the material breach of any representation, warranty, covenant or indemnification provision in the Environmental Indemnity, this Agreement or in the Security Instrument concerning environmental laws, hazardous substances and asbestos and any indemnification of Lender with respect thereto in either document;
(x) Borrower's failure to comply with the indemnification obligations in Sections 11.2 and 12.3 hereof;
(xi) the breach of any material representation, warranty or covenant contained in Article 5 hereof;
(xii) the seizure or forfeiture of the Property, or any portion thereof, or Borrower's interest therein, resulting from criminal wrongdoing by Borrower or Guarantor;
(xiii) Borrower's failure to cause any tenant of the Property to obtain a certificate of occupancy in accordance with the requirements of the applicable Lease;
(xiv) Borrower's failure to cause the cure of the Autozone Violation;
(xv) Borrower's failure to maintain flood insurance for the Property with a deductible of not more than $25,000; provided, however, Borrower's liability under this clause (xv) shall be limited to the amount of the deductible under the flood insurance policy; and/or
(xvi) Borrower's failure to maintain the Environmental Insurance Policy.
(b) Notwithstanding anything to the contrary in this Agreement, the Note or any of the Loan Documents Documents, (iA) Lender shall not be deemed to have waived any right which Lender may have under Section 506(a), 506(b), 1111(b) or any other provisions of the U.S. Bankruptcy Code to file a claim for the full amount of the Debt or to require that all collateral shall continue to secure all of the Debt owing to Lender in accordance with the Loan Documents, and (iiB) the Debt shall become be fully recourse to Borrower (but not its members (other than Guarantor solely to the extent provided in the Non-Recourse Guaranty) or other direct or indirect constituent members or partners or any other Person) in the event that: (Ai) Borrower or any SPE Component Entity files a voluntary petition under the first full Monthly Debt Service Payment Amount Bankruptcy Code or any other Creditors Rights Laws; (as defined ii) an Affiliate, officer, director, or representative which Controls, directly or indirectly, Borrower files, or joins in the Note) filing of, an involuntary petition against Borrower or any SPE Component Entity under the Note is not paid when due; (B) Bankruptcy Code or any other than in connection with a default under subsection (x) of the definition of Special Purpose Bankruptcy Remote Creditors Rights Laws, or solicits or causes to be solicited petitioning creditors for any involuntary petition against Borrower or any SPE Component Entity set forth in Schedule 5 hereto, Borrower fails to maintain its status as a Special Purpose Bankruptcy Remote Entity in accordance with the provisions of this Agreement and such failure results in the substantive consolidation of Borrower with another from any Person; (Ciii) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any subordinate financing or other voluntary lien encumbering the Property; (D) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any assignment, transfer, or conveyance of the Property or any interest therein as and to the extent required by this Agreement or the Mortgage; or (E) (1) if any petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law, shall be filed by Borrower or Guarantor, or (2) if Borrower or Guarantor SPE Component Entity files an answer consenting to, to or otherwise acquiescing in or joining in, in any involuntary petition for bankruptcyfiled against it, reorganization by any other Person under the Bankruptcy Code or arrangement pursuant to federal bankruptcy lawany other Creditors Rights Laws, or solicits or causes to be solicited petitioning creditors for any similar involuntary petition against it; (iv) any Affiliate, officer, director, or representative which Controls Borrower or any SPE Component Entity consents to or acquiesces in or joins in an application for the appointment of a custodian, receiver, trustee, or examiner for Borrower or any SPE Component Entity or any portion of the Property (other than a receiver requested by Lender in connection with enforcement of its rights under the Loan Documents); (v) Borrower or any SPE Component Entity makes an assignment for the benefit of creditors, or admits, in writing or in any legal proceeding, its insolvency or inability to pay its debts as they become due; (vi) [Intentionally omitted]; (vii) Borrower or any SPE Component Entity (or any Restricted Party) contests or opposes any motion made by Lender to obtain relief from the automatic stay or seeks to reinstate the automatic stay in the event of any federal or state law filed against it by bankruptcy or insolvency proceeding involving the Guarantor or its Affiliates; (viii) Borrower (or any other Person, Restricted Party) accepts from any Guarantor or Guarantor solicits or provides any debtor-in-possession financing to Borrower in the event Borrower (or any Restricted Party) is found pursuant to a final, unappealable order the subject of a court of competent jurisdiction to have solicited bankruptcy or caused to be solicited creditors to file any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law against Borrower or Guarantor, insolvency proceeding; or (3ix) if Borrower any covenant contained in Article 6 hereof is violated or Guarantor are found, pursuant to a final unappealable order of a court of competent jurisdiction, to have been in collusion with creditors that initiate a bankruptcy action or proceeding against Borrower or Guarantor or (F) an Event of Default described in Section 8.1(s) hereof shall have occurredbreached.
Appears in 1 contract
Samples: Loan Agreement (Cole Credit Property Trust Iv, Inc.)
Exculpation. Subject (a) Notwithstanding anything to the contrary herein or in any of the other Loan Documents but subject to the qualifications below, Lender Administrative Agent and Lenders shall not enforce the liability and obligation of Borrower or its constituent members, partners, shareholders, directors, employees or agents or the direct or indirect constituent members, partners, shareholders, directors, employees or agents thereof (collectively, the “Borrower Parties”) or any other Person, to perform and observe the obligations contained in the Note, this Agreement, the Note Security Instrument or any of the other Loan Documents by any action or proceeding wherein a money judgment or any deficiency judgment or other judgment establishing personal liability shall be sought against Borrower or any principal, director, officer, employee, beneficiary, shareholder, partner, member, trustee, agent, or affiliate of Borrower (but specifically excluding Guarantor subject to the terms of the Guaranty) or any legal representatives, successors or assigns of any of the Borrower Parties or any other Personforegoing (collectively, the “Exculpated Parties”), except that Lender Administrative Agent, on behalf of Lenders, may bring a foreclosure action, an action for specific performance or any other appropriate action or proceeding to enable Lender Administrative Agent to enforce and realize upon Lenders’ interest under the Note, this Agreement, the Security Instrument and the other Loan Documents, or in the Property, the Rents Rents, or any other collateral given to Lender Administrative Agent, on behalf of Lenders, pursuant to this Agreement and the other Loan Documents; provided, however, that, except as specifically provided herein, any judgment in any such action or proceeding shall be enforceable against the Borrower Parties only to the extent of their Borrower’s interest in the Property, in the Rents and in any other collateral given to LenderLenders and Administrative Agent, on behalf of Lenders, and LenderAdministrative Agent and Lenders, by accepting the Note, this Agreement, the Note Security Instrument and the other Loan Documents, agrees that it shall not sxx xxx for, seek or demand any deficiency judgment against Borrower or any of the Borrower Exculpated Parties or any other Person in any such action or proceeding under or by reason of or under or in connection with the Note, this Agreement, the Note Security Instrument or any of the other Loan Documents. The provisions of this paragraph Section shall not, however, (i1) constitute a waiver, release or impairment of any obligation evidenced or secured by this Agreement, the Note or any of the other Loan Documents; (ii2) impair the right of Lender Administrative Agent, on behalf of Lenders, to name any of the Borrower Parties, as a party defendant in any action or suit for foreclosure and sale under the MortgageSecurity Instrument; (iii3) affect the validity or enforceability of any separate written indemnity or guaranty (including, without limitation, the Guaranty) made in connection with the Loan or any of the rights and remedies of Lender thereunderAdministrative Agent and Lenders thereunder (including, without limitation, Lenders’ and Administrative Agent’s right to enforce said rights and remedies against Borrower and/or Guarantor (as applicable) personally in such separate written indemnity or guaranty and without the effect of the exculpatory provisions of this Article 13); (iv4) impair the right of Lender Administrative Agent, on behalf of Lenders, to obtain the appointment of a receiver; (v5) impair the enforcement of the Assignment assignment of Leases and Rentsleases contained in the Security Instrument; (6) [Intentionally omitted]; (7) constitute a prohibition against Administrative Agent, on behalf of Lenders, to seek a deficiency judgment against Borrower in order to fully realize the security granted by the Security Instrument (but not to impose personal liability upon Borrower contrary to this Section 13.1) or to commence any other appropriate action or proceeding in order for Administrative Agent to exercise Lenders’ remedies against the Property; or (vi) 8) constitute a waiver of the right of Lender Administrative Agent and Lenders to enforce the liability and obligation of Borrower (but not against any members of Borrower (other than Guarantor to the extent provided in the Non-Recourse Guaranty) or their direct or indirect constituent members or partners or any other Person)Borrower, by money judgment or otherwise, to the extent of any loss, damage, cost, expense, liability, claim or other obligation (but excluding any punitive, consequential or speculative damages) Losses incurred by Lender Administrative Agent and/or Lenders (including attorneys’ fees and costs reasonably incurred) directly arising out of or in connection with caused by the following:
(ai) fraud or intentional willful misrepresentation by Borrower Borrower, any of the Exculpated Parties or Guarantor in connection with the Loan;
(bii) intentional the gross negligence or willful misconduct of Borrower, any of the Exculpated Parties or Guarantor;
(iii) material physical waste of to the Property (including, but not limited to, waste due to gross negligence) by Borrower or any affiliate portion thereof; provided) caused by the intentional acts or intentional omissions of Borrower, however, such physical waste shall exclude wear and tear to the Property that occurs in the ordinary course of business any of the Property by Borrower Exculpated Parties or any affiliate thereof;
(c) the material breach of any representation, warranty, covenant or indemnification provision in the Environmental Indemnity or in this Agreement concerning Environmental Laws, Hazardous Substances and Asbestos;
(d) Guarantor and/or the removal or disposal by Borrower or any affiliate thereof of any portion of the Property by Borrower, any of the Exculpated Parties or Guarantor after an Event of Default has occurred and while it is continuing, unless such portion of the Property is replaced by an item of equal or greater value as determined by Lender in its reasonable discretionDefault;
(eiv) the misapplication misapplication, misappropriation or conversion by Borrower or any affiliate thereof of (iA) any insurance proceeds paid by reason of any loss, damage or destruction Casualty to the PropertyProperty (or any portion thereof), or (iiB) any awards Awards or other amounts received in connection with the condemnation Condemnation of all or a portion of the Property, which such proceeds or Award are received by Borrower and not applied as required hereunder or under the other Loan Documents;
(iiiv) the misapplication, misappropriation or conversion by Borrower of any Rents following during the continuance of an Event of Default Default, which are received by Borrower and not applied by Borrower to the payment of either (i) normal and necessary Operating Expenses or (ivii) any Rents paid more than one (1) month in advancethe Debt;
(fvi) failure by Borrower to pay charges pay, or cause to be paid, prior to delinquency any Taxes or Other Charges (other than amounts paid to Administrative Agent for labor Taxes or materials or taxes or other charges that can Other Charges in connection with a Reserve Account hereunder and where Administrative Agent elects not to apply such funds toward the payment of Taxes and Other Charges owed) if non-payment of the same would create liens superior senior to the lien of the Mortgage Security Instrument on all or any portion of the Property unless such taxes or other charges are being contested in accordance herewith or such taxes or charges have been delivered to Lender in accordance with Section 3.3 hereof or Borrower has complied with Section 5.2 hereof; andProperty;
(gvii) the failure of Borrower to deliver any security deposits, advance deposits or any other deposits collected by Borrower or any affiliate thereof with respect to the Property which are not delivered to Lender Administrative Agent, on behalf of Lenders, upon a foreclosure of the Property (or any portion thereof) or action in lieu thereof, except to the extent any such security deposits were applied in accordance with the terms and conditions of any of the Leases prior to the occurrence of the Event of Default that gave rise to such foreclosure or action in lieu thereof. ;
(viii) the material breach of any representation, warranty, covenant or indemnification provision in the Environmental Indemnity, this Agreement or in the Security Instrument concerning environmental laws, hazardous substances and asbestos and any indemnification of Lender and/or Administrative Agent with respect thereto in either document;
(ix) Borrower’s failure to comply with the indemnification obligations in 12.3 hereof;
(x) the breach of any material representation, warranty or covenant contained in Article 5 hereof;
(xi) the seizure or forfeiture of the Property, or any portion thereof, or Borrower’s interest therein, resulting from criminal wrongdoing by Borrower or Guarantor; and/or
(xii) the breach by Borrower of the terms of the Interest Rate Protection Agreement that results in the termination thereof.
(b) Notwithstanding anything to the contrary in this Agreement, the Note or any of the Loan Documents Documents, (iA) Lender Administrative Agent and Lenders shall not be deemed to have waived any right which Lender Administrative Agent and Lenders may have under Section 506(a), 506(b), 1111(b) or any other provisions of the U.S. Bankruptcy Code to file a claim for the full amount of the Debt or to require that all collateral shall continue to secure all of the Debt owing to Lender Administrative Agent and Lenders in accordance with the Loan Documents, and (iiB) the Debt shall become be fully recourse to Borrower (but not its members (other than Guarantor solely to the extent provided in the Non-Recourse Guaranty) or other direct or indirect constituent members or partners or any other Person) in the event that: (Ai) Borrower files a voluntary petition under the first full Monthly Debt Service Payment Amount Bankruptcy Code or any other Creditors Rights Laws; (as defined ii) an Affiliate, officer, director, or representative which Controls, directly or indirectly, Borrower files, or joins in the Note) filing of, an involuntary petition against Borrower under the Note is not paid when due; (B) Bankruptcy Code or any other than in connection with a default under subsection (x) of the definition of Special Purpose Bankruptcy Remote Entity set forth in Schedule 5 heretoCreditors Rights Laws, or solicits or causes to be solicited petitioning creditors for any involuntary petition against Borrower fails to maintain its status as a Special Purpose Bankruptcy Remote Entity in accordance with the provisions of this Agreement and such failure results in the substantive consolidation of Borrower with another from any Person; (Ciii) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any subordinate financing or other voluntary lien encumbering the Property; (D) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any assignment, transfer, or conveyance of the Property or any interest therein as and to the extent required by this Agreement or the Mortgage; or (E) (1) if any petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law, shall be filed by Borrower or Guarantor, or (2) if Borrower or Guarantor files an answer consenting to, to or otherwise acquiescing in or joining in, in any involuntary petition for bankruptcyfiled against it, reorganization by any other Person under the Bankruptcy Code or arrangement pursuant to federal bankruptcy lawany other Creditors Rights Laws, or solicits or causes to be solicited petitioning creditors for any similar involuntary petition against it; (iv) any Affiliate, officer, director, or representative which Controls Borrower consents to or acquiesces in or joins in an application for the appointment of a custodian, receiver, trustee, or examiner for Borrower or any portion of the Property (other than a receiver requested by Administrative Agent in connection with enforcement of its rights under the Loan Documents); (v) Borrower makes an assignment for the benefit of creditors, or admits, in writing or in any legal proceeding, its insolvency or inability to pay its debts as they become due; (vi) [Intentionally omitted]; (vii) Borrower (or any Restricted Party) contests or opposes any motion made by Administrative Agent or any Lender to obtain relief from the automatic stay or seeks to reinstate the automatic stay in the event of any federal or state law filed against it by bankruptcy or insolvency proceeding involving the Guarantor or its Affiliates; (viii) Borrower (or any other Person, Restricted Party) accepts from any Guarantor or Guarantor solicits or provides any debtor-in-possession financing to Borrower in the event Borrower (or any Restricted Party) is found pursuant to a final, unappealable order the subject of a court of competent jurisdiction to have solicited bankruptcy or caused to be solicited creditors to file any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law against Borrower or Guarantor, insolvency proceeding; or (3ix) if Borrower any covenant contained in Article 6 hereof is violated or Guarantor are found, pursuant to a final unappealable order of a court of competent jurisdiction, to have been in collusion with creditors that initiate a bankruptcy action or proceeding against Borrower or Guarantor or (F) an Event of Default described in Section 8.1(s) hereof shall have occurredbreached.
Appears in 1 contract
Samples: Loan Agreement (Cole Credit Property Trust III, Inc.)
Exculpation. Subject Notwithstanding any provision of this Agreement or any Loan Document to the qualifications belowcontrary, Lender but subject to the further provisions of this Article X, the Secured Parties shall not enforce the liability and obligation of Borrower or its constituent members, partners, shareholders, directors, employees or agents or the direct or indirect constituent members, partners, shareholders, directors, employees or agents thereof (collectively, the “Borrower Parties”) or any other Person, Borrowers to perform and observe the obligations contained in this Agreement, the Note or any of the other Loan Documents by any action or proceeding wherein a money judgment shall be sought against any of the Borrower Parties Transaction Party or any other Personof their respective officers, directors, managers, shareholders or employees (collectively, the “Exculpated Parties”), except that Lender the Administrative Agent may bring a foreclosure action, an action for specific performance or any other appropriate action or proceeding to enable Lender the Administrative Agent to enforce and realize upon the Propertythis Agreement, the Rents or any other collateral given to Lender pursuant to this Agreement and the other Loan Documents, and the interest in the Collateral; provided, however, that, except as specifically provided herein, that any judgment in any such action or proceeding shall be enforceable against the Borrower Parties only to the extent of their interest the Borrowers’ interests in the PropertyCollateral. The Secured Parties agree that they shall not, except as otherwise provided herein or in the Rents and in any other collateral given to LenderMortgages, and Lender, by accepting this Agreement, the Note and the other Loan Documents, agrees that it shall not sxx for, seek or demand any deficiency judgment against any of the Borrower Exculpated Parties or any other Person in any such action or proceeding proceeding, under or by reason of or under or in connection with this Agreement, the Note or any of the other Loan Documents. The provisions of this paragraph Section 10.01 shall not, however, (i) constitute a waiver, release or impairment of any obligation evidenced or secured by this Agreement, the Note or any of the other Loan Documents; (ii) impair the right of Lender the Administrative Agent to name any of the Borrower Parties, Transaction Party as a party defendant in any action or suit for judicial foreclosure and sale under the any Mortgage; (iii) affect the validity or enforceability of any indemnity, guaranty (including the Guaranty), master lease or similar instrument made in connection with the Loan or any rights and remedies of Lender thereunderDocuments; (iv) impair the right of Lender the Administrative Agent to obtain the appointment of a receiver; (v) impair the enforcement of the any Assignment of Leases and RentsLeases; (vi) impair the right of the Secured Parties to enforce the provisions of the Mortgages; (vii) exercise of any other remedy set forth in this Agreement or in any other Loan Document which is not inconsistent with the terms of this Section 10.01; or (viviii) constitute a waiver of impair the right of Lender the Secured Parties to enforce the liability and obligation of Borrower (but not against any members of Borrower (other than Guarantor to the extent provided in the Non-Recourse Guaranty) or their direct or indirect constituent members or partners or any other Person), by money obtain a deficiency judgment or otherwise, other judgment on the Notes against Borrowers if necessary to (A) preserve or enforce its rights and remedies against the extent of Collateral or (B) obtain any loss, damage, cost, expense, liability, claim insurance proceeds or other obligation (but excluding any punitive, consequential or speculative damages) incurred by Lender (including attorneys’ fees and costs reasonably incurred) arising out of or in connection with condemnation awards to which the following:
(a) fraud or intentional misrepresentation by Borrower or Guarantor in connection with Secured Parties would otherwise be entitled under the Loan;
(b) intentional physical waste terms of the Property (including, but not limited to, waste due to gross negligence) by Borrower or any affiliate thereofLoan Documents; provided, however, the Secured Parties shall only enforce such physical waste shall exclude wear and tear to the Property that occurs in the ordinary course of business of the Property by Borrower or any affiliate thereof;
(c) the material breach of any representation, warranty, covenant or indemnification provision in the Environmental Indemnity or in this Agreement concerning Environmental Laws, Hazardous Substances and Asbestos;
(d) the removal or disposal by Borrower or any affiliate thereof of any portion of the Property after an Event of Default has occurred and while it is continuing, unless such portion of the Property is replaced by an item of equal or greater value as determined by Lender in its reasonable discretion;
(e) the misapplication or conversion by Borrower or any affiliate thereof of (i) any insurance proceeds paid by reason of any loss, damage or destruction to the Property, (ii) any awards or other amounts received in connection with the condemnation of all or a portion of the Property, (iii) any Rents following an Event of Default or (iv) any Rents paid more than one (1) month in advance;
(f) failure to pay charges for labor or materials or taxes or other charges that can create liens superior to the lien of the Mortgage on any portion of the Property unless such taxes or other charges are being contested in accordance herewith or such taxes or charges have been delivered to Lender in accordance with Section 3.3 hereof or Borrower has complied with Section 5.2 hereof; and
(g) any security deposits collected by Borrower or any affiliate thereof with respect to the Property which are not delivered to Lender upon a foreclosure of the Property or action in lieu thereof, except judgment to the extent any such security deposits were applied in accordance with the terms and conditions of any of the Leases prior to the occurrence of the Event of Default that gave rise to such foreclosure or action in lieu thereof. Notwithstanding anything to the contrary in any of the Loan Documents (i) Lender shall not be deemed to have waived any right which Lender may have under Section 506(a), 506(b), 1111(b) or any other provisions of the U.S. Bankruptcy Code to file a claim for the full amount of the Debt or to require that all collateral shall continue to secure all of the Debt owing to Lender in accordance with the Loan Documents, and (ii) the Debt shall become fully recourse to Borrower (but not its members (other than Guarantor solely to the extent provided in the Non-Recourse Guaranty) or other direct or indirect constituent members or partners or any other Person) in the event that: (A) the first full Monthly Debt Service Payment Amount (as defined in the Note) under the Note is not paid when due; (B) other than in connection with a default under subsection (x) of the definition of Special Purpose Bankruptcy Remote Entity set forth in Schedule 5 hereto, Borrower fails to maintain its status as a Special Purpose Bankruptcy Remote Entity in accordance with the provisions of this Agreement and such failure results in the substantive consolidation of Borrower with another Person; (C) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any subordinate financing or other voluntary lien encumbering the Property; (D) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any assignment, transfer, or conveyance of the Property or any interest therein as and to the extent required by this Agreement or the Mortgage; or (E) (1) if any petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law, shall be filed by Borrower or Guarantor, or (2) if Borrower or Guarantor files an answer consenting to, or otherwise joining in, any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law filed against it by any other Person, or is found pursuant to a final, unappealable order of a court of competent jurisdiction to have solicited or caused to be solicited creditors to file any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law against Borrower or Guarantor, or (3) if Borrower or Guarantor are found, pursuant to a final unappealable order of a court of competent jurisdiction, to have been in collusion with creditors that initiate a bankruptcy action or proceeding against Borrower or Guarantor or (F) an Event of Default described in Section 8.1(s) hereof shall have occurredinsurance proceeds and/or condemnation awards.
Appears in 1 contract
Samples: Term Loan Agreement (American Realty Capital Hospitality Trust, Inc.)
Exculpation. Subject Notwithstanding any provision in this Agreement to the qualifications belowcontrary, Lender it is agreed and understood that Purchaser shall look solely to the assets of Seller and Xxxxxxx Xxxxx 00 in the event of any breach or default by Seller under this Agreement or any breach or default by Xxxxxxx Xxxxx 00 under the Xxxxxxx Xxxxx 00 Xxxxxxxx, and not enforce to the liability and obligation assets of: (a) any Person which is a partner in Seller, or which otherwise owns or holds any ownership interest in Seller, {N4542682.1} 35 directly or indirectly (each such partner or other holder or owner of Borrower any interest in Seller being referred to herein as a “Subtier Owner”); (b) any Person which is a member, manager or its constituent memberspartner in or otherwise owns or holds any ownership interest in any Subtier Owner, partnerswhether directly or indirectly; (c) any Person serving as an officer, shareholdersdirector, directorsemployee or otherwise for or in Seller; or (d) any Person serving as an officer, employees director, employee or agents otherwise for or the direct in any Subtier Owner. This Agreement is executed by one or indirect constituent members, partners, shareholders, directors, employees or agents thereof more persons (collectively, the “Borrower PartiesSignatories”, whether one or more) or any other Person, to perform of Seller and observe the obligations contained Xxxxxxx Xxxxx 00 solely in this Agreement, the Note or any their capacities as representatives of the other Loan Documents by Seller, Xxxxxxx Xxxxx 00 or a Subtier Owner and not in their own individual capacities. Purchaser hereby releases and relinquishes the Signatories from any action and all personal liability for any matters or proceeding wherein a money judgment shall be sought against claims of any of the Borrower Parties or any other Person, except that Lender may bring a foreclosure action, an action for specific performance or any other appropriate action or proceeding to enable Lender to enforce and realize upon the Property, the Rents or any other collateral given to Lender pursuant to this Agreement and the other Loan Documents; provided, however, that, except as specifically provided herein, any judgment in any such action or proceeding shall be enforceable against the Borrower Parties only to the extent of their interest in the Property, the Rents and in any other collateral given to Lender, and Lender, by accepting this Agreement, the Note and the other Loan Documents, agrees that it shall not sxx for, seek or demand any deficiency judgment against any of the Borrower Parties or any other Person in any such action or proceeding kind which arise under or by reason of or in connection with or as a result of this Agreement, the Note or any of the other Loan Documents. The provisions foregoing release of this paragraph liability shall not, however, (i) constitute a waiver, release or impairment of any obligation evidenced or secured by this Agreement, the Note or any of the other Loan Documents; (ii) impair the right of Lender to name any of the Borrower Parties, as a party defendant in any action or suit for foreclosure and sale under the Mortgage; (iii) affect the validity or enforceability of any guaranty made in connection with the Loan or any rights and remedies of Lender thereunder; (iv) impair the right of Lender to obtain the appointment of a receiver; (v) impair the enforcement of the Assignment of Leases and Rents; or (vi) constitute a waiver of the right of Lender to enforce the liability and obligation of Borrower (but not against any members of Borrower (other than Guarantor to the extent provided in the Non-Recourse Guaranty) or their direct or indirect constituent members or partners or any other Person), by money judgment or otherwise, to the extent of any loss, damage, cost, expense, liability, claim or other obligation (but excluding any punitive, consequential or speculative damages) incurred by Lender (including attorneys’ fees and costs reasonably incurred) arising out of or in connection with the following:
(a) fraud or intentional misrepresentation by Borrower or Guarantor in connection with the Loan;
(b) intentional physical waste of the Property (including, but not limited to, waste due to gross negligence) by Borrower or any affiliate thereof; provided, however, such physical waste shall exclude wear and tear to the Property that occurs in the ordinary course of business of the Property by Borrower or any affiliate thereof;
(c) the material breach of any representation, warranty, covenant or indemnification provision in the Environmental Indemnity or in this Agreement concerning Environmental Laws, Hazardous Substances and Asbestos;
(d) the removal or disposal by Borrower or any affiliate thereof of any portion of the Property after an Event of Default has occurred and while it is continuing, unless such portion of the Property is replaced by an item of equal or greater value as determined by Lender in its reasonable discretion;
(e) the misapplication or conversion by Borrower or any affiliate thereof of (i) any insurance proceeds paid by reason of any loss, damage or destruction to the Property, (ii) any awards or other amounts received in connection with the condemnation of all or a portion of the Property, (iii) any Rents following an Event of Default or (iv) any Rents paid more than one (1) month in advance;
(f) failure to pay charges for labor or materials or taxes or other charges that can create liens superior to the lien of the Mortgage on any portion of the Property unless such taxes or other charges are being contested in accordance herewith or such taxes or charges have been delivered to Lender in accordance with Section 3.3 hereof or Borrower has complied with Section 5.2 hereof; and
(g) any security deposits collected by Borrower or any affiliate thereof be effective with respect to and shall apply to all claims against any members, managers and partners of any Subtier Owner regardless of whether such claims arise as a result of any liability which the Property which are not delivered to Lender upon a foreclosure Signatories may have as members, managers or partners of the Property or action in lieu thereofSeller, except to the extent any such security deposits were applied in accordance with the terms and conditions of any of the Leases prior to the occurrence of the Event of Default that gave rise to such foreclosure or action in lieu thereof. Notwithstanding anything to the contrary in any of the Loan Documents (i) Lender shall not be deemed to have waived any right which Lender may have under Section 506(a), 506(b), 1111(b) Xxxxxxx Xxxxx 00 or any other provisions of the U.S. Bankruptcy Code to file a claim for the full amount of the Debt or to require that all collateral shall continue to secure all of the Debt owing to Lender in accordance with the Loan Documents, and (ii) the Debt shall become fully recourse to Borrower (but not its members (other than Guarantor solely to the extent provided in the Non-Recourse Guaranty) or other direct or indirect constituent members or partners or any other Person) in the event that: (A) the first full Monthly Debt Service Payment Amount (as defined in the Note) under the Note is not paid when due; (B) other than in connection with a default under subsection (x) of the definition of Special Purpose Bankruptcy Remote Entity set forth in Schedule 5 hereto, Borrower fails to maintain its status as a Special Purpose Bankruptcy Remote Entity in accordance with the provisions of this Agreement and such failure results in the substantive consolidation of Borrower with another Person; (C) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any subordinate financing or other voluntary lien encumbering the Property; (D) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any assignment, transferSubtier Owner, or conveyance of the Property or any interest therein as and to the extent required by this Agreement or the Mortgage; or (E) (1) if any petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law, shall be filed by Borrower or Guarantor, or (2) if Borrower or Guarantor files an answer consenting to, or otherwise joining in, any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law filed against it by any other Person, or is found pursuant to a final, unappealable order of a court of competent jurisdiction to have solicited or caused to be solicited creditors to file any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law against Borrower or Guarantor, or (3) if Borrower or Guarantor are found, pursuant to a final unappealable order of a court of competent jurisdiction, to have been in collusion with creditors that initiate a bankruptcy action or proceeding against Borrower or Guarantor or (F) an Event of Default described in Section 8.1(s) hereof shall have occurredotherwise.
Appears in 1 contract
Samples: Membership Interest Purchase Agreement (Stratus Properties Inc)
Exculpation. (a) Subject to the qualifications below, Lender shall not enforce the liability and obligation of Borrower or its constituent members, partners, shareholders, directors, employees or agents or the direct or indirect constituent members, partners, shareholders, directors, employees or agents thereof (collectively, the “Borrower Parties”) or any other Person, to perform and observe the obligations contained in the Note, this Agreement, the Note Security Instrument or any of the other Loan Documents by any action or proceeding wherein a money judgment or any deficiency judgment or other judgment establishing personal liability shall be sought against Borrower or any principal, director, officer, employee, beneficiary, shareholder, partner, member, trustee, agent, or Affiliate of Borrower (but specifically excluding Guarantor) or any legal representatives, successors or assigns of any of the Borrower Parties or any other Personforegoing (collectively, the “Exculpated Parties”), except that Lender may bring a foreclosure action, an action for specific performance or any other appropriate action or proceeding to enable Lender to enforce and realize upon its interest under the Note, this Agreement, the Security Instrument and the other Loan Documents, or in the Property, the Rents Rents, or any other collateral given to Lender pursuant to this Agreement and the other Loan Documents; provided, however, that, except as specifically provided herein, any judgment in any such action or proceeding shall be enforceable against the Borrower Parties only to the extent of their Borrower’s interest in the Property, in the Rents and in any other collateral given to Lender, and Lender, by accepting the Note, this Agreement, the Note Security Instrument and the other Loan Documents, agrees that it shall not sxx for, seek or demand any deficiency judgment against Borrower or any of the Borrower Exculpated Parties or any other Person in any such action or proceeding under or by reason of or under or in connection with the Note, this Agreement, the Note Security Instrument or any of the other Loan Documents. The provisions of this paragraph Section shall not, however, (i1) constitute a waiver, release or impairment of any obligation evidenced or secured by this Agreement, the Note or any of the other Loan Documents; (ii2) impair the right of Lender to name any of the Borrower Parties, as a party defendant in any action or suit for foreclosure and sale under the MortgageSecurity Instrument; (iii3) affect the validity or enforceability of or any guaranty made in connection with the Loan or any of the rights and remedies of Lender thereunder; (iv4) impair the right of Lender to obtain the appointment of a receiver; (v5) impair the enforcement of the Assignment assignment of Leases leases and Rentsrents contained in the Security Instrument; (6) impair the right of Lender to enforce Section 4.12(e) of this Agreement; (7) constitute a prohibition against Lender to seek a deficiency judgment against Borrower in order to fully realize the security granted by the Security Instrument or to commence any other appropriate action or proceeding in order for Lender to exercise its remedies against the Property; or (vi) 8) constitute a waiver of the right of Lender to enforce the liability and obligation of Borrower (but not against any members of Borrower (other than Guarantor to the extent provided in the Non-Recourse Guaranty) or their direct or indirect constituent members or partners or any other Person)Borrower, by money judgment or otherwise, to the extent of any loss, damage, cost, expense, liability, claim or other obligation (but excluding any punitive, consequential or speculative damages) Losses incurred by Lender (including attorneys’ fees and costs reasonably incurred) arising out of or in connection with any of the following:
(ai) fraud or intentional misrepresentation or any failure to disclose a material fact by Borrower, any SPE Component Entity, Guarantor, Sponsor, Master Lessee or any Borrower or Guarantor Party in connection with the Loan;
(bii) intentional the gross negligence or willful misconduct of Borrower, any SPE Component Entity, Guarantor, Sponsor, Master Lessee, or any Borrower Party or the commission of a criminal act by Borrower, any SPE Component Entity, Guarantor, Sponsor, Master Lessee or any Borrower Party which results in any seizure or forfeiture of the Property, or any portion thereof, or Borrower’s interest therein;
(iii) material physical waste of to the Property caused by the intentional acts or intentional omissions of Borrower, any SPE Component Entity, Guarantor, Sponsor, Master Lessee, or any Borrower Party (including, but not limited towithout limitation, waste due to gross negligence) by Borrower any arson or any affiliate thereof; provided, however, such physical waste shall exclude wear and tear to the Property that occurs in the ordinary course of business abandonment of the Property by Borrower or any affiliate thereof;
(cProperty) the material breach of any representation, warranty, covenant or indemnification provision in the Environmental Indemnity or in this Agreement concerning Environmental Laws, Hazardous Substances and Asbestos;
(d) and/or the removal or disposal by Borrower or any affiliate thereof of any portion of the Property after during the continuation an Event of Default has occurred and while it by Borrower, any SPE Component Entity, Guarantor, Sponsor, Master Lessee, or any Borrower Party, without the replacement of same, to the extent the same is continuing, unless such portion material to the operation of the Property is replaced by an item of equal or greater value as determined by Lender in its reasonable discretionProperty;
(eiv) the misapplication misapplication, misappropriation or conversion by Borrower or any affiliate thereof Master Lessee of (iA) any insurance proceeds paid by reason of any loss, damage or destruction to the Property, (iiB) any awards Awards or other amounts received in connection with the condemnation Condemnation of all or a portion of the Property, (iiiC) any Rents following an Event of Default or (ivD) any Tenant security deposits or Rents paid more than one (1) month collected in advance;
(fv) failure to pay any Taxes or Other Charges, charges for labor or materials or taxes or any other charges that can create liens superior to the lien of the Mortgage on any portion of the Property unless (other than (x) amounts deposited with Lender as Tax Reserve Funds for Taxes or Other Charges where Lender elects not to apply such taxes funds toward payment of such Taxes or other charges Other Charges owed or (y) Taxes or Other Charges owed that are being contested in accordance herewith or such taxes or charges have been delivered to Lender strictly in accordance with Section 3.3 hereof or Borrower has complied with Section 5.2 hereof; andthe terms of the Loan Documents) to the extent that the revenue from the Property is sufficient to pay such amounts as well as other costs of servicing the Debt and of operating the Property;
(gvi) failure to maintain insurance as required by this Agreement (other than the failure to pay amounts deposited with Lender as Insurance Reserve Funds for Insurance Premiums to be paid to maintain such insurance where Lender elects not to apply such funds toward payment of such Insurance Premiums) to the extent that the revenue from the Property is sufficient to pay the Insurance Premiums relating thereto as well as other costs of servicing the Debt and of operating the Property;
(vii) the breach of any representation, warranty, covenant or indemnification provision in the Environmental Indemnity, this Agreement or in the Security Instrument concerning Environmental Laws and Hazardous Substances;
(viii) any security deposits collected fees or commissions paid by Borrower or Master Lessee after the occurrence and during the continuation of any affiliate thereof with respect Event of Default to the Property which are not delivered to Lender upon a foreclosure Guarantor, Sponsor, Master Lessee, and/or any Affiliate of Borrower, Guarantor, Sponsor and/or Master Lessee in violation of the Property terms of the Note, this Agreement, the Security Instrument or action the other Loan Documents;
(ix) Borrower’s breach of, or failure to comply with, the representations, warranties and covenants contained in lieu thereofSections 15.1 and 15.3 of this Agreement and/or the provisions of Section 11.2 hereof;
(x) Borrower or Master Lessee fails to appoint a new property manager upon the request of Lender, except to the extent any such security deposits were applied each as required by, and in accordance with the terms and conditions provisions of, this Agreement, the Assignment of Management Agreement and the other Loan Documents or Borrower or Master Lessee appoints a new property manager or replaces the property manager other than in accordance with the terms of this Agreement, the Assignment of Management Agreement and the other Loan Documents;
(xi) any litigation or other legal proceeding related to the Debt filed by Borrower, any SPE Component Entity, Guarantor, Sponsor, Master Lessee or any Borrower Party that delays, opposes, impedes, obstructs, hinders, enjoins or otherwise interferes with or frustrates the efforts of Lender to exercise any rights and remedies available to Lender as provided herein and in the other Loan Documents, provided that neither Borrower nor Guarantor shall be liable to the extent of any applicable loss, damage, cost, expense, liability, claim or other obligation arising solely from a defense of Borrower, Guarantor or any Affiliate of Borrower or Guarantor raised in good faith;
(xii) any representation, warranty or covenant contained in Section 5.1 or Section 5.3 hereof is violated or breached;
(xiii) Borrower and/or Master Lessee fails to comply with the Cash Management Agreement relating to the establishment of a Deposit Account (as defined in the Cash Management Agreement), a Cash Management Account, and/or the institution of cash management generally;
(xiv) Borrower’s failure to deposit any initial springing Reserve Fund deposit required pursuant to this Agreement;
(xv) if, in connection with any transfer of the Leases prior Property to Lender (or Lender’s designee) in full or partial satisfaction of the Debt, Borrower or any affiliate of Borrower fails to take any lawful action reasonably necessary to effect the transfer of any licenses or permits with respect to the occurrence Property from the then-current holder thereof to the transferee of the Event Property or its designee; and/or
(xvi) any amendment, modification or termination of Default that gave rise to such foreclosure or action in lieu thereofthe Master Lease without Lender’s consent. Notwithstanding anything to the contrary in this Agreement, the Note or any of the Loan Documents Documents, (iA) Lender shall not be deemed to have waived any right which Lender may have under Section 506(a), 506(b), 1111(b) or any other provisions of the U.S. Bankruptcy Code to file a claim for the full amount of the Debt or to require that all collateral shall continue to secure all of the Debt owing to Lender in accordance with the Loan Documents, and (iiB) the Debt shall become be fully recourse to Borrower (but not its members (other than Guarantor solely to the extent provided in the Non-Recourse Guaranty) or other direct or indirect constituent members or partners or any other Person) in the event that: (Ai) the first full Monthly Debt Service Payment Amount (as defined any representation, warranty or covenant contained in the Note) under the Note Article 5 hereof is not paid when due; (B) other than in connection with a default under subsection (x) of the definition of Special Purpose Bankruptcy Remote Entity set forth in Schedule 5 heretoviolated or breached, Borrower fails to maintain its status and such violation or breach is cited as a Special Purpose Bankruptcy Remote Entity in accordance with the provisions of this Agreement and such failure results factor in the substantive consolidation of Borrower with another Personany other person (unless such failure results solely from the economic performance of the Property); (Cii) except as otherwise permitted pursuant to the Loan Documents, if Borrower fails to obtain Lender’s prior written consent to any subordinate financing voluntary Sale or Pledge encumbering the Property for which Lender’s consent is required hereunder; (iii) Borrower, Master Lessee or any SPE Component Entity files a voluntary petition under the Bankruptcy Code or any other voluntary lien encumbering Creditors Rights Laws; (iv) an Affiliate, officer, director, or representative which Controls, directly or indirectly, Borrower, Master Lessee or any SPE Component Entity files, or joins in the filing of, an involuntary petition against Borrower, Master Lessee or any SPE Component Entity under the Bankruptcy Code or any other Creditors Rights Laws, or solicits or causes to be solicited petitioning creditors for any involuntary petition against Borrower, Master Lessee or any SPE Component Entity from any Person; (v) Borrower, Master Lessee or any SPE Component Entity files an answer consenting to or otherwise acquiescing in or joining in any involuntary petition filed against it, by any other Person under the Bankruptcy Code or any other Creditors Rights Laws, or solicits or causes to be solicited petitioning creditors for any involuntary petition from any Person; (vi) any Affiliate, officer, director, or representative which Controls Borrower, Master Lessee or any SPE Component Entity consents to or acquiesces in or joins in an application for the appointment of a custodian, receiver, trustee, or examiner for Borrower, Master Lessee, any SPE Component Entity or any portion of the Property; (Dvii) except Borrower, Master Lessee or any SPE Component Entity makes an assignment for the benefit of creditors or admits in any legal proceeding its insolvency or inability to pay its debts as otherwise permitted pursuant they become due; (viii) there is substantive consolidation of Borrower, Master Lessee or any SPE Component Entity (or any Restricted Party) with any other Person in connection with any federal or state bankruptcy proceeding involving the Guarantor or any of its Affiliates and one of the factors cited as the bases therefor is a breach by Borrower or Master Lessee of any representation, warranty or covenant contained in Sections 5.1 and/or 5.3 hereof; (ix) intentionally omitted; (x) there occurs any voluntary cancellation, surrender, or termination of the Franchise Agreement by Borrower and/or Master Lessee without the prior written consent of Lender unless a Replacement Franchise Agreement is entered into concurrently with such termination in accordance with this Agreement, or (xi) Borrower and/or Master Lessee amends or modifies the Franchise Agreement without the prior written consent of Lender (to the extent such consent is required under the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any assignment, transfer, or conveyance of the Property or any interest therein as and to the extent required by this Agreement or the Mortgage; or (E) (1) if any petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law, shall be filed by Borrower or Guarantor, or (2) if Borrower or Guarantor files an answer consenting to, or otherwise joining in, any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law filed against it by any other Person, or is found pursuant to a final, unappealable order of a court of competent jurisdiction to have solicited or caused to be solicited creditors to file any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law against Borrower or Guarantor, or (3) if Borrower or Guarantor are found, pursuant to a final unappealable order of a court of competent jurisdiction, to have been in collusion with creditors that initiate a bankruptcy action or proceeding against Borrower or Guarantor or (F) an Event of Default described in Section 8.1(s) hereof shall have occurred).
Appears in 1 contract
Exculpation. Subject Notwithstanding any provision herein or in any of the other Loan Documents to the qualifications belowcontrary, except as set forth in this Section 9.4, Lender shall not enforce the liability and obligation of any Borrower or its constituent members, partners, shareholders, directors, employees or agents or the direct or indirect constituent members, partners, shareholders, directors, employees or agents thereof (collectively, the “Borrower Parties”) or any other Person, to perform and observe the obligations contained in this Agreement, the Note Note, the Mortgages or any of the other Loan Documents by any an action or proceeding wherein a money judgment shall be sought against any Borrower or any judgment shall be sought against any director, officer, employee, partner, member or stockholder of any Borrower, or its general partners (all of the Borrower Parties or any other Personforegoing, except that collectively, "Principals"). Lender may bring a foreclosure action, an action for specific performance or any other appropriate action or proceeding to enable Lender to enforce and realize upon the Property, the Rents or any other collateral given to Lender pursuant to this Agreement and the other Loan Documents; provided, however, that, except as specifically provided herein, any judgment in any such action or proceeding shall be enforceable against the Borrower Parties only to the extent of their interest in the Property, the Rents and in any other collateral given to Lender, and Lender, by accepting this Agreement, the Note and the other Loan Documents, hereby agrees that it shall not sxx sue for, seek or demand any deficiency judgment against any of the Borrower Parties Borrowxx or any other Person judgment, including a judgment for specific performance, against its Principals or any one or more of them in any such action or proceeding proceeding, under or by reason of or under or in connection with this Agreement, the Note, the Mortgages or the other Loan Documents except to the extent necessary or appropriate to proceed against or execute or foreclose on any or all of the collateral granted to Lender under the Loan Documents. The provisions of this Section 9.4 shall not, however, (a) impair the validity of the indebtedness evidenced by the Note or in any way affect or impair the lien of the Mortgages or any of the other Loan Documents. The provisions , or the right of this paragraph shall not, however, (i) constitute a waiver, release Lender to foreclose the Mortgages or impairment of otherwise realize upon any obligation evidenced or secured by this Agreement, collateral securing the Note or any following an Event of the other Loan DocumentsDefault; (iib) impair the right of Lender to name any of the Borrower Parties, or any other Person as a party defendant in any action or suit for judicial foreclosure and sale or otherwise under the MortgageMortgages to the extent necessary to realize upon any collateral securing the Note; (iii) affect the validity or enforceability of any guaranty made in connection with the Loan or any rights and remedies of Lender thereunder; (ivc) impair the right of Lender to obtain the appointment of a receiver; (vd) impair the enforcement of the Assignment of Leases and RentsLeases; or (vie) constitute a waiver of impair the right of Lender to enforce the liability and obligation of Borrower (but not against any members of Borrower (other than Guarantor to the extent provided in the Non-Recourse Guaranty) or their direct or indirect constituent members or partners bring suit with respect to, or any other Person)Borrower's personal liability for, by money judgment or otherwise, to the extent of any loss, damage, cost, expense, liability, claim or other obligation (but excluding any punitive, consequential or speculative damages) incurred by Lender (including attorneys’ fees and costs reasonably incurred) arising out of or in connection with the following:
(a) fraud or intentional misrepresentation by any Borrower or Guarantor any other Person in connection with this Agreement, the Loan;
Note, the Mortgages or any other Loan Document; (bf) intentional physical waste impair the right of Lender to bring suit with respect to, or any Borrower's personal liability for, any Borrower's misappropriation of tenant security deposits or Rents; (g) impair the right of Lender to obtain, or any Borrower's personal liability for any Borrower's misapplication or misappropriation of insurance proceeds or condemnation awards due to Lender under the Mortgages or the other Loan Documents; (h) impair the right of Lender to enforce, or any Borrower's personal liability for, the breach of any provision in that certain Environmental and Hazardous Substance Indemnification Agreement of even date herewith given by Borrowers to Lender concerning environmental laws, hazardous substances and asbestos and any indemnification of Lender with respect thereto in such document, whether before or after payment in full of the Property principal amount of the Note; (includingi) prevent or in any way hinder Lender from exercising, but not limited or constitute a defense, or counterclaim or other basis for relief in respect of the exercise of, any other remedy against the collateral securing the Note as provided in the Loan Documents or as prescribed by law or in equity in case of Default; (j) prevent or in any way hinder Lender from exercising, or constitute a defense, a counterclaim, or other basis for relief in respect of the exercise of its remedies in respect of any judgments or other sums due from any Borrower to Lender other than under the Loan Documents; (k) impair the right of Lender to bring suit with respect to, waste due to gross negligence) by Borrower or any affiliate thereofBorrower's personal liability for, any Borrower's misappropriation, during the continuance of an Event of Default, from any Property of any items of personalty or any fixtures or any other misappropriation with respect to any Property during the continuance of an Event of Default; (l) impair the right of Lender to bring suit with respect to, or any Borrower's personal liability for, losses, damages or liabilities suffered by Lender arising from any acts or omissions by any Borrower that resulted in waste, provided, however, such physical that waste shall exclude wear and tear to the Property that occurs in the ordinary course of business of the Property by Borrower or any affiliate thereof;
(c) the material breach of any representation, warranty, covenant or indemnification provision in the Environmental Indemnity or in this Agreement concerning Environmental Laws, Hazardous Substances and Asbestos;
(d) the removal or disposal by Borrower or any affiliate thereof of any portion of the Property after an Event of Default has occurred and while it is continuing, unless such portion of the Property is replaced by an item of equal or greater value as determined by Lender in its reasonable discretion;
(e) the misapplication or conversion by Borrower or any affiliate thereof of (i) any insurance proceeds paid by reason of any loss, damage or destruction to the Property, (ii) any awards or other amounts received in connection with the condemnation of all or a portion of the Property, (iii) any Rents following an Event of Default or (iv) any Rents paid more than one (1) month in advance;
(f) failure to pay charges for labor or materials or taxes or other charges that can create liens superior to the lien of the Mortgage on any portion of the Property unless such taxes or other charges are being contested in accordance herewith or such taxes or charges have been delivered to Lender in accordance with Section 3.3 hereof or Borrower has complied with Section 5.2 hereof; and
(g) any security deposits collected by Borrower or any affiliate thereof with respect to the Property which are not delivered to Lender upon a foreclosure of the Property or action in lieu thereof, except to the extent any such security deposits were applied in accordance with the terms and conditions of any of the Leases prior to the occurrence of the Event of Default that gave rise to such foreclosure or action in lieu thereof. Notwithstanding anything to the contrary in any of the Loan Documents (i) Lender shall not be deemed to have waived any right which Lender may have under Section 506(a)include the non-payment of Taxes, 506(b)Other Charges, 1111(b) mechanic's liens, materialmen's liens or any other provisions liens arising from work performed on, or materials delivered to, the Properties, or (m) impair the right of the U.S. Bankruptcy Code Lender to file a claim for the full amount bring suit with respect to, or any personal liability of the Debt or to require that all collateral shall continue to secure all of the Debt owing to Lender in accordance with the Loan Documents, and (ii) the Debt shall become fully recourse to any Borrower (but not its members (other than Guarantor solely to the extent provided in the Non-Recourse Guaranty) or other direct or indirect constituent members or partners or any other Person) in the event that: (A) the first full Monthly Debt Service Payment Amount (as defined in the Note) Person for, any obligation of any Borrower or other Person under the Note is not paid when due; (B) other than in connection with a default under subsection (x) of the definition of Special Purpose Bankruptcy Remote Entity set forth in Schedule 5 hereto, Borrower fails to maintain its status as a Special Purpose Bankruptcy Remote Entity in accordance with the provisions of this Securitization Indemnification Agreement and such failure results in the substantive consolidation of Borrower with another Person; (C) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any subordinate financing or other voluntary lien encumbering the Property; (D) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any assignment, transfer, or conveyance of the Property or any interest therein as and to the extent required by this Agreement or the Mortgage; or (E) (1) if any petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law, shall be filed by Borrower or Guarantor, or (2) if Borrower or Guarantor files an answer consenting to, or otherwise joining in, any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law filed against it by any other Person, or is found pursuant to a final, unappealable order of a court of competent jurisdiction to have solicited or caused to be solicited creditors to file any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law against Borrower or Guarantor, or (3) if Borrower or Guarantor are found, pursuant to a final unappealable order of a court of competent jurisdiction, to have been in collusion with creditors that initiate a bankruptcy action or proceeding against Borrower or Guarantor or (F) an Event of Default described in Section 8.1(s) hereof shall have occurred9.2.
Appears in 1 contract
Samples: Loan Agreement (Prime Retail Lp)
Exculpation. (a) Subject to the qualifications belowset forth in this Section, Lender shall not enforce the liability and obligation of Borrower or its constituent members, partners, shareholders, directors, employees or agents or the direct or indirect constituent members, partners, shareholders, directors, employees or agents thereof (collectively, the “Borrower Parties”) or any other Person, to perform and observe the obligations contained in this Agreement, the Note Note, the Mortgages, the Assignment of Leases or any of the other Loan Documents by any an action or proceeding wherein a money judgment shall be sought against any of the Borrower Parties or any other PersonBorrower, except that Lender may bring a foreclosure action, an action for specific performance or any other appropriate action or proceeding to enable Lender to enforce and realize upon the Propertythis Agreement, the Rents Note, the Mortgages, the Assignment of Leases or the other Loan Documents, and the interests in the Properties and any other collateral given to Lender pursuant to this Agreement Agreement, the Mortgages, the Assignment of Leases and the other Loan Documents; provided, however, that, except as specifically provided hereinin this Article, any judgment in any such action or proceeding shall be enforceable against the Borrower Parties only to the extent of their Borrower's interest in the Property, the Rents Properties and in any other collateral given to Lender, and . Lender, by accepting this Agreement, the Note Note, the Assignment of Leases, the Mortgages and the other Loan Documents, agrees that it shall not sxx sue for, seek or demand any deficiency judgment against any of the Borrower Parties or any other Person in any xxx such action or proceeding under or proceeding, under, by reason of or in connection with this Agreement, the Note Note, the Mortgages, the Assignment of Leases or any of the other Loan Documents. The provisions of this paragraph Article shall not, however, : (ia) constitute a waiver, release or impairment of any obligation evidenced or secured by this Agreement, the Note Note, the Mortgages, the Assignment of Leases, the Environmental Agreement, the Guaranty Agreement or any of the other Loan Documents; (ii) impair the right of Lender to name any of the Borrower Parties, as a party defendant in any action or suit for foreclosure and sale under the MortgageMortgages; (iii) affect the validity or enforceability of any guaranty or indemnity made in connection with this Agreement, the Note, the Mortgages, the Assignment of Leases or the other Loan or any rights and remedies of Lender thereunderDocuments; (iv) impair the right of Lender to obtain the appointment of a receiver; (v) impair the enforcement of the Assignment of Leases and RentsLeases; or (vi) constitute a waiver of impair the right of Lender to enforce the liability and obligation of Borrower (but not against any members of Borrower (other than Guarantor bring suit with respect to the extent provided in the Non-Recourse Guaranty) or their direct or indirect constituent members or partners or any other Person), by money judgment or otherwise, to the extent of any loss, damage, cost, expense, liability, claim or other obligation (but excluding any punitive, consequential or speculative damages) incurred by Lender (including attorneys’ fees and costs reasonably incurred) arising out of or in connection with the following:
(a) fraud or intentional misrepresentation by Borrower or Guarantor any other person or entity in connection with this Agreement, the Loan;Mortgages, the Note, the Assignment of Leases, the Environmental Agreement or the other Loan Documents; or (vii) affect the validity or enforceability of the Environmental Agreement or the Guaranty Agreement or limit the liability of Borrower, Guarantor or any other party thereunder.
(b) intentional physical waste of the Property (including, but not limited to, waste due to gross negligence) by Borrower or any affiliate thereof; provided, however, such physical waste Nothing herein shall exclude wear and tear to the Property that occurs in the ordinary course of business of the Property by Borrower or any affiliate thereof;
(c) the material breach of any representation, warranty, covenant or indemnification provision in the Environmental Indemnity or in this Agreement concerning Environmental Laws, Hazardous Substances and Asbestos;
(d) the removal or disposal by Borrower or any affiliate thereof of any portion of the Property after an Event of Default has occurred and while it is continuing, unless such portion of the Property is replaced by an item of equal or greater value as determined by Lender in its reasonable discretion;
(e) the misapplication or conversion by Borrower or any affiliate thereof of (i) any insurance proceeds paid by reason of any loss, damage or destruction to the Property, (ii) any awards or other amounts received in connection with the condemnation of all or a portion of the Property, (iii) any Rents following an Event of Default or (iv) any Rents paid more than one (1) month in advance;
(f) failure to pay charges for labor or materials or taxes or other charges that can create liens superior to the lien of the Mortgage on any portion of the Property unless such taxes or other charges are being contested in accordance herewith or such taxes or charges have been delivered to Lender in accordance with Section 3.3 hereof or Borrower has complied with Section 5.2 hereof; and
(g) any security deposits collected by Borrower or any affiliate thereof with respect to the Property which are not delivered to Lender upon a foreclosure of the Property or action in lieu thereof, except to the extent any such security deposits were applied in accordance with the terms and conditions of any of the Leases prior to the occurrence of the Event of Default that gave rise to such foreclosure or action in lieu thereof. Notwithstanding anything to the contrary in any of the Loan Documents (i) Lender shall not be deemed to have waived be a waiver of any right which Lender may have under Section 506(a), 506(b), 1111(b) or any other provisions of the U.S. Bankruptcy Code to file a claim for the full amount of the Debt secured by the Mortgages or to require that all collateral shall continue to secure all of the Debt debt owing to Lender in accordance with the this Agreement, the Note, the Mortgages, the Assignment of Leases, the Environmental Agreement, the Guaranty Agreement and the other Loan Documents.
(c) Notwithstanding the foregoing provisions of this Article or any other provision in the Loan Documents, each entity comprising the Borrower and Guarantor shall be jointly and severally fully liable for and shall indemnify Lender for any and all loss, cost, liability, judgment, claim, damage or expense sustained, suffered or incurred by Lender (including, without limitation, Lender's reasonable attorneys' fees) arising out of or attributable or relating to:
(i) fraud or misrepresentation by Borrower or Guarantor in connection with the Loan;
(ii) the Debt shall become fully recourse to gross negligence or willful misconduct of Borrower or Guarantor, their respective agents or employees, or the physical waste of the Properties;
(but not its members (other than Guarantor solely to iii) the extent provided breach of provisions in the Non-Recourse GuarantyMortgages or in the Environmental Agreement concerning Environmental Laws, Hazardous Substances and Asbestos, and any indemnification of Lender therein with respect to such Environmental Laws, Hazardous Substances and Asbestos;
(iv) the removal or other direct or indirect constituent members or partners disposal of any portion of the Properties after default under the Note, the Mortgages, the Assignment of Leases, the Environmental Agreement, the Guaranty Agreement or any other PersonLoan Document;
(v) in the event thatmisapplication or conversion by Borrower or any Guarantor of: (A) any insurance proceeds paid by reason of any loss, damage or destruction to the first full Monthly Debt Service Payment Amount (as defined in the Note) under the Note is not paid when dueProperties; (B) any awards or other than amounts received in connection with the condemnation of all or a default under subsection (x) portion of the definition of Special Purpose Bankruptcy Remote Entity set forth in Schedule 5 hereto, Borrower fails to maintain its status as a Special Purpose Bankruptcy Remote Entity in accordance with the provisions of this Agreement and such failure results in the substantive consolidation of Borrower with another PersonProperties; or (C) except as otherwise permitted pursuant rents, issues, profits, proceeds, accounts, or other amounts received by Borrower or Guarantor (in the case of clause (C) following an Event of Default under this Agreement, the Note, the Mortgages, the Environmental Agreement, the Guaranty Agreement or any other Loan Document);
(vi) Borrower's failure to pay taxes, assessments, charges for labor or materials or other charges that may result in liens on any portion of the Properties;
(vii) the deductible amount of any insurance maintained in respect of the Properties;
(viii) the costs incurred by Lender (including attorneys' fees) in connection with the collection or enforcement of the Debt;
(ix) Borrower's failure to make any property repairs or alterations required under the Loan Documents, Borrower fails including without limitation, alterations required in order to comply with the Americans With Disabilities Act;
(x) Borrower's failure to permit on-site inspections of the Properties or to provide financial reports and information pertaining to the Properties as required by this Agreement and the Mortgages, unless, in either case, such failure is the result of a good faith error and is cured within ten (10) days after notice;
(xi) any security deposits or advance deposits collected with respect to the Properties which are not delivered to Lender upon a foreclosure of any Property or action in lieu thereof;
(xii) Borrower's failure to obtain Lender’s 's written consent to any subordinate financing;
(xiii) Borrower's failure to obtain Lender's prior written consent to any subordinate financing transfer of the Properties or other voluntary lien encumbering of any ownership interest in Borrower; and
(xiv) the Propertyfailure of Borrower to comply with the provisions of Section 4.14 of this Agreement pertaining to its single-purpose entity status.
(d) Notwithstanding the foregoing, the agreement of Lender not to pursue recourse liability as set forth in subsection (a) above SHALL BECOME NULL AND VOID and shall be of no further force or effect if: (i) any financial information concerning Borrower or Guarantor is fraudulent in any respect, contains any fraudulent information or misrepresents in any material respect the financial condition of any Borrower or Guarantor; (Dii) a voluntary bankruptcy or insolvency proceeding is commenced by Borrower or its sole member; or (iii) an involuntary bankruptcy or insolvency proceeding is commenced by any party (other than Lender) against Borrower or its sole member and is not unconditionally dismissed within ninety (90) days of filing (except as otherwise permitted pursuant to if such involuntary action is brought by Lender). Upon the occurrence of any of the foregoing events, Borrower and Guarantor shall have full joint and several recourse liability for all sums due under the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any assignment, transfer, or conveyance of the Property or any interest therein as and to the extent required by this Agreement or the Mortgage; or (E) (1) if any petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law, shall be filed by Borrower or Guarantor, or (2) if Borrower or Guarantor files an answer consenting to, or otherwise joining in, any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law filed against it by any other Person, or is found pursuant to a final, unappealable order of a court of competent jurisdiction to have solicited or caused to be solicited creditors to file any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law against Borrower or Guarantor, or (3) if Borrower or Guarantor are found, pursuant to a final unappealable order of a court of competent jurisdiction, to have been in collusion with creditors that initiate a bankruptcy action or proceeding against Borrower or Guarantor or (F) an Event of Default described in Section 8.1(s) hereof shall have occurred.
Appears in 1 contract
Exculpation. Subject to the qualifications below, Lender shall not enforce the liability and obligation of Borrower or its constituent members, partners, shareholders, directors, employees or agents or the direct or indirect constituent members, partners, shareholders, directors, employees or agents thereof (collectively, the “Borrower Parties”) or any other Person, to perform and observe the obligations contained in the Note, this Agreement, the Note Mortgage or any of the other Loan Documents by any action or proceeding wherein a money judgment shall be sought against Borrower, Guarantor or any direct or indirect principal, director, officer, employee, beneficiary, shareholder, partner, member, Constituent Member, trustee, agent or affiliate of Borrower, Guarantor or any person owning, directly or indirectly, any legal or beneficial interest in Borrower, or Guarantor or any successors or assigns of any of the Borrower Parties or any other Personforegoing (collectively, the “Exculpated Parties”), except that Lender may bring a foreclosure action, an action for specific performance or any other appropriate action or proceeding to enable Lender to enforce and realize upon its interest under the Note, this Agreement, the Mortgage and the other Loan Documents, or in the Property, the Rents Rents, or any other collateral given to Lender pursuant to this Agreement and the other Loan Documents; provided, however, that, except as specifically provided herein, any judgment in any such action or proceeding shall be enforceable against the Borrower Parties only to the extent of their Borrower’s interest in the Property, in the Rents and in any other collateral given to Lender, and Lender, by accepting the Note, this Agreement, the Note Mortgage and the other Loan Documents, agrees that it shall not sxx xxx for, seek or demand any deficiency judgment against Borrower or any of the Borrower Exculpated Parties or any other Person in any such action or proceeding under or by reason of or under or in connection with the Note, this Agreement, the Note Mortgage or any of the other Loan Documents. The provisions of this paragraph section shall not, however, (ia) constitute a waiver, release or impairment of any obligation evidenced or secured by this Agreement, the Note or any of the other Loan Documents; (iib) impair the right of Lender to name any of the Borrower Parties, as a party defendant in any action or suit for foreclosure and sale under the Mortgage; (iiic) affect the validity or enforceability of any guaranty made in connection with the Loan or any of the rights and remedies of Lender thereunder; (ivd) impair the right of Lender to obtain the appointment of a receiver; (ve) impair the enforcement of the Assignment of Leases and RentsLeases; (f) constitute a prohibition against Lender to seek a deficiency judgment against Borrower in order to fully realize the security granted the Mortgage or to commence any other appropriate action or proceeding in order for Lender to exercise its remedies against the Property; or (vig) constitute a waiver of the right of Lender to enforce the liability and obligation of Borrower (but not against any members of Borrower (other than Guarantor to the extent provided in the Non-Recourse Guaranty) or their direct or indirect constituent members or partners or any other Person)Borrower, by money judgment or otherwise, to the extent of any loss, damage, cost, expense, liability, claim or other obligation (but excluding any punitive, consequential or speculative damages) incurred by Lender (including reasonable attorneys’ fees and costs reasonably incurredincurred but excluding any consequential damages) arising out of or in connection with the following:
(ai) fraud or intentional misrepresentation by Borrower or Guarantor Hotel Operator in connection with the Loan;
(b) intentional physical waste of the Property (including, but not limited to, waste due to gross negligence) by Borrower or any affiliate thereof; provided, however, such physical waste shall exclude wear and tear to the Property that occurs in the ordinary course of business of the Property by Borrower or any affiliate thereof;
(cii) the material breach of any representation, warranty, covenant or indemnification provision in the Environmental Indemnity or in this Agreement the Mortgage concerning Environmental Lawsenvironmental laws, Hazardous Substances hazardous substances and Asbestosasbestos and any indemnification of Lender with respect thereto in either document;
(diii) to the removal or disposal extent proceeds received by Borrower or any affiliate thereof of any portion of Hotel Operator, the Property after an Event of Default has occurred and while it is continuing, unless such portion of the Property is replaced by an item of equal or greater value as determined by Lender in its reasonable discretion;
(e) the misapplication or conversion misappropriation by Borrower or any affiliate thereof Hotel Operator in violation of an express provision in the Loan Documents of (iA) any insurance proceeds paid by reason of any loss, damage or destruction to the Property, (iiB) any awards or other amounts received in connection with the condemnation Condemnation of all or a portion of the Property, (iiiC) any Rents received following an Event of Default Default, or collected more than thirty (30) days in advance, or (D) any security deposits;
(iv) any Rents paid more than one (1) month in advance;
(f) failure to pay charges for labor or materials or taxes obtain Lender’s prior written consent required under this Agreement to any subordinate financing or other charges that can create liens superior to voluntary lien encumbering the lien of the Mortgage on any portion of the Property unless such taxes or other charges are being contested in accordance herewith or such taxes or charges have been delivered to Lender in accordance with Section 3.3 hereof or Borrower has complied with Section 5.2 hereofProperty; and
(gv) any security deposits collected by the material failure of Borrower to maintain its status as a single purpose entity in compliance with Section 4.1.30 of this Agreement or any affiliate thereof the material failure of Hotel Operator to maintain its status as a single purpose entity in compliance with respect to the Property which are not delivered to Lender upon a foreclosure Section 19 of the Property or action in lieu thereof, except to the extent any such security deposits were applied in accordance with the terms and conditions of any of the Leases prior to the occurrence of the Event of Default that gave rise to such foreclosure or action in lieu thereofSubordination Agreement. Notwithstanding anything to the contrary in this Agreement, the Note or any of the Loan Documents Documents, (iA) Lender shall not be deemed to have waived any right which Lender may have under Section 506(a), 506(b), 1111(b) or any other provisions of the U.S. Bankruptcy Code to file a claim for the full amount of the Debt secured by the Mortgage or to require that all collateral shall continue to secure all of the Debt owing to Lender in accordance with the Loan Documents, and (iiB) the Debt shall become be fully recourse to Borrower (but not its members (other than Guarantor solely to the extent provided in the Non-Recourse Guaranty) or other direct or indirect constituent members or partners or any other Person) in the event that: (Ai) the first full Monthly Debt Service Payment Amount (as defined in the Note) under the Note is not paid when due; (B) other than in connection with a default under subsection (x) of the definition of Special Purpose Bankruptcy Remote Entity set forth in Schedule 5 hereto, Borrower fails to maintain its status as a Special Purpose Bankruptcy Remote Entity in accordance with the provisions of this Agreement and such failure results in the substantive consolidation of Borrower with another Person; (C) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any subordinate financing or other voluntary lien encumbering Transfer of the PropertyProperty as required by this Agreement; (Dii) Borrower or Hotel Operator files a voluntary petition under the Bankruptcy Code or any other Federal or state bankruptcy or insolvency law; (iii) an Affiliate, officer, director, or representative which controls, directly or indirectly, Borrower or Hotel Operator files, or joins in the filing of, an involuntary collusive petition against Borrower or Hotel Operator under the Bankruptcy Code or any other Federal or state bankruptcy or insolvency law, or solicits or causes to be solicited petitioning creditors for any involuntary petition against Borrower from any Person; (iv) Borrower or Hotel Operator solicits or causes to be solicited petitioning creditors for any involuntary collusive petition from any Person; (v) any Affiliate, officer, director, or representative which controls Borrower or Hotel Operator joins in voluntary or involuntary collusive application for the appointment of a custodian, receiver, trustee, or examiner for Borrower, Hotel Operator or any portion of the Property (vi) Borrower or Hotel Operator makes a voluntary or involuntary collusive assignment for the benefit of creditors, or admits, in writing or in any legal proceeding, its insolvency or inability to pay its debts as they become due. Notwithstanding anything to the contrary in this Agreement or any other Loan Document, and except as otherwise permitted pursuant to for each Guarantor’s obligations under the Guaranty, no present or future Constituent Member in Borrower, nor any present or future shareholder, officer, director, employee, trustee, beneficiary, advisor, member, partner, principal, participant or agent of or in Borrower or of or in any person or entity that is or becomes a Constituent Member in Borrower, shall have any personal liability, directly or indirectly, under or in connection with this Agreement or any of the Loan Documents, Borrower fails to obtain Lender’s prior written consent or any amendment or amendments to any assignmentof the foregoing made at any time or times, transferheretofore or hereafter, and Lender on behalf of itself and its successors and assigns, hereby waives any and all such personal liability. In addition, Lender, for itself and its successors and assigns, acknowledges and agrees that neither Borrower, nor any Constituent Member, nor any other party, is assuming any personal liability, directly or conveyance indirectly, under or in connection with any agreement, lease, instrument, claim or right constituting a part of the Property or any interest therein as and to which the extent required by Property is now or hereafter subject. For purposes of this Agreement and each of the other Loan Documents, neither the negative capital account of any Constituent Member in Borrower nor any obligation of any Constituent Member in Borrower to restore a negative capital account or to contribute or loan capital to Borrower or to any other Constituent Member in Borrower shall at any time be deemed to be the Mortgage; property or an asset of Borrower (E) (1) if any petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal such other Constituent Member) and neither Lender nor any of its successors or state law, shall be filed by Borrower or Guarantor, or (2) if Borrower or Guarantor files an answer consenting to, or otherwise joining in, any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law filed against it by any other Person, or is found pursuant to a final, unappealable order of a court of competent jurisdiction to have solicited or caused to be solicited creditors to file any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law against Borrower or Guarantor, or (3) if Borrower or Guarantor are found, pursuant to a final unappealable order of a court of competent jurisdiction, to have been in collusion with creditors that initiate a bankruptcy action or proceeding against Borrower or Guarantor or (F) an Event of Default described in Section 8.1(s) hereof assigns shall have occurredany right to collect, enforce or proceed against with respect to any such negative capital account or obligation to restore, contribute or loan.
Appears in 1 contract
Exculpation. Subject Notwithstanding anything to the contrary contained in this Agreement, the Note, the Mortgages or the other Loan Documents but subject to the qualifications below, Lender shall not enforce the liability and obligation of Borrower or its constituent members, partners, shareholders, directors, employees or agents or the direct or indirect constituent members, partners, shareholders, directors, employees or agents thereof (collectively, the “Borrower Parties”) or any other Person, Borrowers to perform and observe the obligations contained in the Note, this Agreement, the Note Mortgages or any of the other Loan Documents by any action or proceeding wherein a money judgment shall be sought against any of the Borrower Parties or any other PersonBorrower, except that Lender may bring a foreclosure action, an action for specific performance or any other appropriate action or proceeding to enable Lender to enforce and realize upon its interest under the PropertyNote, this Agreement, the Rents Mortgages and the other Loan Documents, or in the Properties, the Rents, or any other collateral given to Lender pursuant to this Agreement and the other Loan Documents; provided, however, that, except as specifically provided herein, any judgment in any such action or proceeding shall be enforceable against the Borrower Parties Borrowers only to the extent of their each such Borrower’s interest in the PropertyProperties, in the Rents and in any other collateral given to Lender, and Lender, by accepting the Note, this Agreement, the Note Mortgages and the other Loan Documents, agrees that it shall not sxx xxx for, seek or demand any deficiency judgment against any of the Borrower Parties or any other Person in any such action or proceeding under under, or by reason of of, or in connection with with, the Note, this Agreement, the Note Mortgages or any of the other Loan Documents. The provisions of this paragraph Section 9.4 shall not, however, (ia) constitute a waiver, release or impairment of any obligation evidenced or secured by this Agreement, the Note or any of the other Loan Documents; (iib) impair the right of Lender to name any of the Borrower Parties, as a party defendant in any action or suit for foreclosure and sale under the MortgageMortgages; (iiic) affect the validity or enforceability of or any guaranty Guaranty made in connection with the Loan or any of the rights and remedies of Lender thereunder; (ivd) impair the right of Lender to obtain the appointment of a receiver; (ve) impair the enforcement of the Assignment Assignments of Leases and RentsLeases; (f) constitute a prohibition against Lender seeking a deficiency judgment against any Borrower in order to fully realize the security granted by the Mortgages or commencing any other appropriate action or proceeding in order for Lender to exercise its remedies against one or more of the Properties; or (vig) constitute a waiver of the right of Lender to enforce the liability and obligation of Borrower (but not against any members of Borrower (other than Guarantor to the extent provided in the Non-Recourse Guaranty) or their direct or indirect constituent members or partners or any other Person)Borrowers, by money judgment or otherwise, to the extent of any loss, damage, cost, expense, liability, claim or other obligation (but excluding any punitive, consequential or speculative damages) incurred by Lender (including attorneys’ fees and costs reasonably incurred) arising out of or in connection with the following:
(ai) fraud or intentional willful misrepresentation by or on behalf of any Borrower or Guarantor or any Affiliate of any of them in connection with the LoanLoan or any of the Properties;
(bii) intentional physical waste the gross negligence or willful misconduct of any Borrower, Guarantor or any Affiliate of any of them in connection with the Loan or any of the Property (including, but not limited to, waste due to gross negligence) by Borrower or any affiliate thereof; provided, however, such physical waste shall exclude wear and tear to the Property that occurs in the ordinary course of business of the Property by Borrower or any affiliate thereofProperties;
(ciii) the material breach of any representation, warranty, covenant or indemnification provision in the Environmental Indemnity or in Indemnity, this Agreement or the Mortgages concerning Environmental Laws, Laws or Hazardous Substances and AsbestosSubstances;
(div) the wrongful removal or disposal by Borrower or any affiliate thereof destruction of any portion of the Property after an Event of Default has occurred and while it is continuing, unless such portion any of the Property is replaced Properties or any physical waste of any of the Properties, in either case by an item or on behalf of equal any Borrower, Guarantor or greater value as determined by Lender in its reasonable discretionany Affiliate of any of them;
(ev) the breach of any Legal Requirement (including, without limitation, RICO) mandating the forfeiture by any Borrower of any Property or Properties owned by such Borrower, or any portion thereof, because of the conduct or purported conduct of criminal activity by any Borrower or any Restricted Party in connection therewith;
(vi) intentionally omitted;
(vii) the misapplication or conversion by or on behalf of any Borrower or any affiliate thereof of (iA) any insurance proceeds Insurance Proceeds paid by reason of any loss, damage or destruction to the PropertyCasualty, (iiB) any awards or other amounts Awards received in connection with the condemnation of all or a portion of the PropertyCondemnation, (iiiC) any Rents following collected during the continuance of an Event of Default Default, or (ivD) any Rents paid more than one (1) month in advance;
(fviii) the failure to pay charges for labor or materials or taxes or other charges incurred by or on behalf of any Borrower, Guarantor or any Affiliate of any of them that can create liens superior Liens on one or all of the Properties (including any portion thereof) to the lien of the Mortgage on any portion of the Property unless extent such taxes Liens are not bonded over or other charges are being contested in accordance herewith or such taxes or charges have been delivered to Lender discharged in accordance with Section 3.3 hereof this Agreement or Borrower has complied with Section 5.2 hereof; andthe other Loan Documents;
(gix) the failure of any security deposits, advance deposits or any other deposits collected by Borrower or any affiliate thereof with respect to any of the Property which are not Properties to be delivered to Lender upon a foreclosure of one or more of the Property Properties or action in lieu thereof, except to the extent any such security deposits were applied in accordance with the terms and conditions of any of the Leases prior to the occurrence of the Event of Default that gave rise to such foreclosure or action in lieu thereof; or
(x) the failure of any Borrower to maintain its status as a Single Purpose Entity. Notwithstanding anything to the contrary in this Agreement, the Note or any of the Loan Documents Documents, (iA) Lender shall not be deemed to have waived any right which Lender may have under Section 506(a), 506(b), 1111(b) or any other provisions of the U.S. Bankruptcy Code to file a claim for the full amount of the Debt secured by the Mortgages or to require that all collateral shall continue to secure all of the Debt owing to Lender Obligations in accordance with the Loan Documents, and (iiB) each Borrower shall be personally liable for the Debt shall become fully recourse to Borrower payment of the Obligations (but not its members (other than Guarantor solely to the extent provided in the Non-Recourse Guaranty) or other direct or indirect constituent members or partners or any other Person1) in the event thatof: (Aa) any Borrower filing a voluntary petition under the Bankruptcy Code or any other federal or state bankruptcy or insolvency law; (b) the filing by any Person of an involuntary petition against any Borrower under the Bankruptcy Code or any other Federal or state bankruptcy or insolvency law, in which such Borrower colludes with or solicits or causes to be solicited petitioning creditors; (c) any Borrower colluding to arrange and thereafter filing an answer consenting to or otherwise acquiescing in or joining in any involuntary petition filed against it, by any other Person under the Bankruptcy Code or any other Federal or state bankruptcy or insolvency law; (d) any Borrower consenting to or acquiescing in or joining in an application for the appointment of a custodian, receiver, trustee, or examiner for any Borrower or one or more of the Properties; or (e) any Borrower making an assignment for the benefit of creditors, or admitting, in writing or in any legal proceeding, its insolvency or inability to pay its debts as they become due; (2) if the first full Monthly Debt Service Payment Amount (as defined in the Note) under the Note is not paid when due; (B3) other than in connection with a default under subsection (x) of the definition of Special Purpose Bankruptcy Remote Entity set forth in Schedule 5 hereto, Borrower fails to maintain its status as a Special Purpose Bankruptcy Remote Entity in accordance with the provisions of this Agreement and such failure results in the substantive consolidation of Borrower with another Person; (C) except as otherwise permitted pursuant to the Loan Documents, if any Borrower fails to obtain Lender’s prior written consent to any subordinate financing Indebtedness or other voluntary lien Lien encumbering the Property; (D) except as otherwise permitted pursuant any Property to the Loan Documents, extent required by this Agreement or the Mortgages; or (4) if any Borrower fails to obtain Lender’s prior written consent to any assignmentTransfer, transfer, or conveyance of the Property or any interest therein as and to the extent required by this Agreement or the Mortgage; or (E) (1) if any petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law, shall be filed by Borrower or Guarantor, or (2) if Borrower or Guarantor files an answer consenting to, or otherwise joining in, any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law filed against it by any other Person, or is found pursuant to a final, unappealable order of a court of competent jurisdiction to have solicited or caused to be solicited creditors to file any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law against Borrower or Guarantor, or (3) if Borrower or Guarantor are found, pursuant to a final unappealable order of a court of competent jurisdiction, to have been in collusion with creditors that initiate a bankruptcy action or proceeding against Borrower or Guarantor or (F) an Event of Default described in Section 8.1(s) hereof shall have occurredMortgages.
Appears in 1 contract
Exculpation. (a) Subject to the qualifications below, no recourse shall be had against, Lender shall not enforce the liability and obligation of Borrower or its constituent members, partners, shareholders, directors, employees or agents or the direct or indirect constituent members, partners, shareholders, directors, employees or agents thereof (collectively, the “Borrower Parties”) or any other Person, to perform and observe the obligations contained in the Note, this Agreement, the Note Pledge Agreement or any of the other Loan Documents by any action or proceeding wherein a money judgment or any deficiency judgment or other judgment establishing personal liability shall be sought against against, any Borrower Party or any direct or indirect principal, director, officer, employee, manager, beneficiary, parent, beneficial owner, shareholder, partner, member, trustee, agent, or Affiliate of any Borrower Party or any direct or indirect legal representatives, successors or assigns of any of the Borrower Parties or any other Personforegoing (collectively, the “Exculpated Parties”), except that Lender Lender, may bring a foreclosure action, an action for specific performance or any other appropriate action or proceeding to enforce the Note, this Agreement, the Pledge Agreement and the other Loan Documents, or to enable Lender to enforce and realize upon Lender’s interest in the Property, the Rents Collateral or any other collateral given to Lender pursuant to this Agreement and the other Loan Documents; provided, however, that, except as specifically provided herein, any judgment in any such action or proceeding shall be enforceable against the Borrower Parties only to the extent of their Borrower’s interest in the Property, the Rents Collateral and in any other collateral given to Lender, and Lender, by accepting the Note, this Agreement, the Note Pledge Agreement and the other Loan Documents, agrees that it shall not sxx xxx for, seek or demand any deficiency judgment with respect to the Loan against Borrower or any of the Borrower Exculpated Parties or any other Person in any such action or proceeding under or by reason of or under or in connection with the Note, this Agreement, the Note or any of Pledge Agreement, the other Loan DocumentsDocuments or otherwise. The provisions of this paragraph Section shall not, however, (i1) constitute a waiver, release or impairment of any obligation evidenced or secured by this Agreement, the Note or any of the other Loan Documents; (ii2) impair the right of Lender to name any of the Borrower Parties, as a party defendant in any action or suit for foreclosure, exercise of any power of sale, or an assignment in lieu of foreclosure and sale under upon the MortgageCollateral or exercise of remedies pursuant to the Pledge Agreement; (iii3) affect the validity or enforceability of any Loan Document or any guaranty in connection with the Loan (including, without limitation, the indemnities set forth in Article 12 hereof, the Guaranty and the Environmental Indemnity) made in connection with the Loan or any of the rights and remedies of Lender thereunder; (iv4) intentionally omitted, (5) impair the right of Lender to (A) obtain the appointment of a receiverreceiver and/or (B) enforce its rights and remedies provided in Articles 8 and 9 hereof; (v6) impair the enforcement of Pledge Agreement or any other Loan Documents; (7) constitute a prohibition against Lender, to seek a deficiency judgment against Borrower in order to fully realize the Assignment of Leases and Rentssecurity granted by the Pledge Agreement or to commence any other appropriate action or proceeding in order for Lender to exercise Lender’s remedies against the Property or any portion thereof; or (vi) 8) constitute a waiver of the right of Lender to enforce the liability and obligation of Borrower (but not against any members of Borrower (other than Guarantor to the extent provided in the Non-Recourse Guaranty) or their direct or indirect constituent members or partners or any other Person)Borrower, by money judgment or otherwise, to the extent of any loss, damage, cost, expense, liability, claim or other obligation (but excluding any punitive, consequential or speculative damages) actual Losses incurred by Lender (including actual out-of-pocket attorneys’ fees and costs reasonably incurred) arising out of or in connection with the following:
(ai) fraud or intentional misrepresentation by any Borrower or Guarantor Party in connection with the Loan;
(bii) the willful misconduct of any Borrower Party in connection with the Loan;
(iii) any litigation or other legal proceeding (including, the raising of defenses) related to the Debt filed or raised by any Borrower Party that delays, opposes, impedes, obstructs, hinders, enjoins or otherwise interferes with or frustrates the efforts of Lender to exercise any rights and remedies available to Lender as provided herein and in the other Loan Documents which is found by a court of competent jurisdiction to be without merit or brought or raised, as applicable, in bad faith;
(iv) intentional physical waste of the Property (including, but not limited to, waste due to gross negligence) by Borrower or any affiliate thereof; provided, however, such physical waste shall exclude wear and tear to the Property that occurs in the ordinary course of business violation of the Property by Borrower or any affiliate thereof;
(c) the material breach terms of any representation, warranty, covenant or indemnification provision in the Environmental Indemnity or in this Agreement concerning Environmental Laws, Hazardous Substances and Asbestos;
(d) caused by any Borrower Party and/or the removal or disposal by Borrower or any affiliate thereof of any portion of the Property after in violation of the terms of this Agreement during the continuance of an Event of Default has occurred and while it is continuing, unless such portion of the Property is replaced by an item of equal or greater value as determined by Lender in its reasonable discretionDefault;
(ev) the misapplication misappropriation or conversion by any Borrower or any affiliate thereof Party, in contravention of the Loan Documents, of (iA) any insurance proceeds paid by reason of any loss, damage or destruction to the Property, (iiB) any awards Awards or other amounts received in connection with the condemnation Condemnation of all or a portion of the Property, (iiiC) any Rents following an Event of Default Rents, or (ivD) any Security Deposits or Rents paid more than one (1) month collected in advance;
(fvi) failure to the extent there exists sufficient cash flow from the Property to pay Taxes or charges for labor or materials or taxes or other charges that can create liens superior to the lien of the Mortgage on any portion of the Property Property, Borrower’s failure to pay or cause Mortgage Borrower to pay such Taxes or charges (except to the extent (A) sums sufficient to pay such Taxes or charges have been deposited with Mortgage Lender in accordance with the terms of the Mortgage Loan Agreement or (B) such cash flow is not being made available to Borrower by Mortgage Lender as a result of Mortgage Lender’s exercise of its remedies under the Mortgage Loan Documents) unless such taxes Taxes or other charges are being contested as permitted hereunder or under the Mortgage Loan Agreement;
(vii) to the extent there exists sufficient cash flow from the Property to pay Insurance Premiums and/or to maintain the Policies in accordance herewith full force and effect, Borrower’s failure to pay or cause Mortgage Borrower to pay such taxes or charges Insurance Premiums and/or to maintain the Policies in full force and effect, in each case, as expressly provided herein (except to the (A) extent sums sufficient to pay such Insurance Premiums and/or to maintain the Policies have been delivered to deposited with Mortgage Lender in accordance with Section 3.3 hereof the terms of the Mortgage Loan Agreement or (B) such cash flow is not being made available to Borrower has complied with Section 5.2 hereof; andby Mortgage Lender as a result of Mortgage Lender’s exercise of its remedies under the Mortgage Loan Documents);
(gviii) any security deposits collected by Borrower or any affiliate thereof with respect to the Property Security Deposits which are not delivered to Lender upon by a Borrower Party following a foreclosure of the Property or action in lieu thereof, except to the extent any such security deposits Security Deposits were (a) delivered to Mortgage Lender in accordance with the Mortgage Loan Documents or (b) applied in accordance with the terms and conditions of any of the applicable Leases prior to the occurrence of an Event of Default;
(ix) if as a result of the actions or inactions of Borrower or its Affiliates or Mortgage Borrower or its Affiliates (including, without limitation, Mortgage Borrower failing to comply with the terms of such Property Document) any Property Document is (A) materially modified in a manner adverse to Lender or Mortgage Borrower, (B) terminated, (C) cancelled or (D) otherwise ceases to exist, except in each of the foregoing cases, if such action or inaction of Borrower or its Affiliates or Mortgage Borrower or its Affiliates is permitted pursuant to the terms of this Agreement and/or Lender has approved the same;
(x) any representation, warranty or covenant contained in Article 5 hereof is violated or breached; provided, however, that solely with respect to a breach of Section 5.1(a)(vii) that arise from Borrower’s or Mortgage Borrower’s failure to pay trade and operational indebtedness, such breach shall not result in recourse under the Loan pursuant to this clause (x), if cash flow from the Property available to Borrower and/or Mortgage Borrower is not sufficient to pay such amounts;
(xi) except as set forth in Section 13.1(b) below, (A) Borrower fails to obtain Lender’s prior consent to any Prohibited Transfer as required by this Agreement (other than a Permitted Transfer) or (B) any covenant contained in Section 6.6 hereof is violated or breached;
(xii) any distributions to Borrower’s direct or indirect legal or beneficial owners after the occurrence and during the continuance of an Event of Default;
(xiii) any liabilities and obligations of Borrower, Mezzanine A Borrower or Mortgage Borrower: (i) accrued or accruing on or prior to any acquisition of title to the Collateral pursuant to a UCC foreclosure sale, a UCC strict foreclosure, an assignment in lieu of foreclosure or other enforcement action under the Loan Documents (collectively, an “Equity Collateral Enforcement Action”; and the date on which an Equity Collateral Enforcement Action is consummated, an “Equity Collateral Transfer Date”) with respect to indemnification obligations accrued or accruing in favor of Borrower, Mezzanine A Borrower, Mortgage Borrower or any Affiliate of Borrower, Mezzanine A Borrower and/or Mortgage Borrower (individually and collectively, a “Borrower Control Party”) under any organizational documents of any Borrower Control Party or any other agreement that was not either approved by Lender or entered into in compliance with this Agreement; (ii) without duplications of amounts paid or payable pursuant to Section 13.1(a)(iii) above, accrued or accruing prior to, on or after the Equity Collateral Transfer Date to pay legal fees to legal counsel engaged by any Borrower Control Party prior to the Equity Collateral Transfer Date if such legal fees were incurred to defend against an enforcement action under the Loan Documents; or (iii) accrued or accruing prior to, on or after the Equity Collateral Transfer Date under any agreement (a “Third Party Agreement”) between any Borrower Control Party, on the one hand, and any Person not Affiliated with Mortgage Borrower, on the other hand, that has been entered into during the continuance of an Event of Default that gave rise without the prior written approval of Lender to the extent such foreclosure prior written approval was required under the Loan Documents (unless such Third Party Agreement has been assumed in writing by the Person acquiring the Collateral on or after the Equity Collateral Transfer Date);
(xiv) Mortgage Borrower or Mezzanine A Borrower “opts out” of Article 8 of the UCC;
(xv) Borrower or any Borrower Party acquires all or any portion of any interest in the Mortgage Loan or in the Mezzanine A Loan in violation of Sections 4.33(a) and (b) hereof and votes or approves the undertaking of any enforcement action under the Mortgage Loan or the Mezzanine A Loan, as applicable; and/or
(xvi) Mortgage Borrower gives notice of termination of the Restricted Account Agreement other than in lieu thereof. accordance with Section 8(d) of the Restricted Account Agreement in effect as of the Closing Date and the Restricted Account Agreement is terminated by Bank as a result of such notice.
(b) Notwithstanding anything to the contrary in this Agreement, the Note or any of the Loan Documents Documents, (iA) Lender shall not be deemed to have waived any right which Lender may have under Section 506(a), 506(b), 1111(b) or any other provisions of the U.S. Bankruptcy Code to file a claim for the full amount of the Debt or to require that all collateral shall continue to secure all of the Debt owing to Lender in accordance with the Loan Documents, and (iiB) the Debt shall become be fully recourse to Borrower (but not its members (other than Guarantor solely to the extent provided in the Non-Recourse Guaranty) or other direct or indirect constituent members or partners or any other Person) in the event that: :
(i) a Bankruptcy Event occurs;
(ii) any voluntary Sale or Pledge of the Property (other than (i) an easement (except for an easement affecting the Property that interferes or impairs in a material way Borrower’s ability to use and operate the Property as currently used or that otherwise has a Material Adverse Effect), (ii) a covenant or restriction that (A) does not interfere with or impair in a material way Borrower’s ability to use and operate the first full Monthly Debt Service Payment Amount (Property as defined in the Note) under the Note is not paid when due; currently used and (B) other than does not have a Material Adverse Effect, and (iii) a Lease entered into at the Property (except for a lease of all or a majority of the Property, a ground lease, or a master lease)), the Collateral or any direct or indirect interest in connection Borrower, Mortgage Borrower or Guarantor that results in a failure to comply with a default under subsection the Minimum Ownership/Control Test, in each case in violation of the terms of this Agreement (but excluding (x) any failure to comply with the requirements in any of clause (A), (D), (E), (G) or (H) appearing in the definition of Special Purpose Bankruptcy Remote Entity set forth “Permitted Transfer” in Schedule 5 hereto, Borrower fails to maintain its status as a Special Purpose Bankruptcy Remote Entity in accordance with the provisions Section 6.3 of this Agreement and such (y) any violation as a result of a failure results in of a Mezzanine Lender to comply with the substantive consolidation of Borrower with another Person; Intercreditor Agreement);
(Ciii) except as otherwise permitted pursuant to the Loan Documents, if Borrower fails to obtain Lender’s prior written consent (if and to the extent required under the Loan Documents) to (A) any subordinate financing or other voluntary lien liens encumbering the Property; Property that are not considered Permitted Encumbrances hereunder or (DB) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any assignment, transfer, subordinate financing or conveyance other voluntary liens encumbering: (1) a direct interest in any subsidiary of the Property or any interest therein as and Guarantor to the extent required by this Agreement such subsidiary owns a direct or the Mortgageindirect interest in Borrower; or (E) (1) if any petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law, shall be filed by Borrower or Guarantor, or (2) a direct or indirect interest in Borrower if foreclosed upon would result in the Minimum Ownership/Control Test not being met; and/or
(iv) if any representation, warranty or covenant contained in Article 5 hereof is violated or breached and such violation or breach results in the substantive consolidation of the assets and liabilities of Borrower, Mezzanine A Borrower or Guarantor files an answer consenting to, or otherwise joining in, any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law filed against it by Mortgage Borrower with the assets and liabilities of any other Person, or is found pursuant to a final, unappealable order of a court of competent jurisdiction to have solicited or caused to be solicited creditors to file any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law against Borrower or Guarantor, or (3) if Borrower or Guarantor are found, pursuant to a final unappealable order of a court of competent jurisdiction, to have been in collusion with creditors that initiate a bankruptcy action or proceeding against Borrower or Guarantor or (F) an Event of Default described in Section 8.1(s) hereof shall have occurred.
Appears in 1 contract
Samples: Mezzanine Loan Agreement (Brookfield DTLA Fund Office Trust Investor Inc.)
Exculpation. Subject to Neither Borrower nor any Guarantor shall be personally liable for payment of the qualifications below, Lender shall not enforce the liability and obligation principal of Borrower or its constituent members, partners, shareholders, directors, employees or agents or the direct or indirect constituent members, partners, shareholders, directors, employees or agents thereof (collectively, the “Borrower Parties”) or any other Person, to perform and observe the obligations contained in this Agreement, the Note or interest thereon, and in the event of any failure by Borrower to pay any portion of such principal or interest, Lenders will look, with respect to the then outstanding balance of such principal and interest, solely to the Mortgaged Property and such other collateral as has been, or hereafter shall be, given to secure payment of the other Loan Documents by any action or proceeding wherein a money judgment shall be sought against any of the Borrower Parties or any other Person, except that Lender may bring a foreclosure action, an action for specific performance or any other appropriate action or proceeding to enable Lender to enforce and realize upon the Property, the Rents or any other collateral given to Lender pursuant to this Agreement and the other Loan Documents; provided, however, that, except as specifically provided herein, any judgment in any such action or proceeding shall be enforceable against the Borrower Parties only to the extent of their interest in the Property, the Rents and in any other collateral given to Lender, and Lender, by accepting this Agreement, the Note and the other Loan Documents, agrees that it Note. The foregoing limitation on liability shall not sxx for, seek impair or demand any deficiency judgment against any of the Borrower Parties or any other Person in any such action or proceeding under or by reason of or in connection with this Agreement, the Note or any of the other Loan Documents. The provisions of this paragraph shall not, however, (i) constitute a waiver, release or impairment of any obligation evidenced or secured by this Agreement, the Note or any of the other Loan Documents; (ii) impair the right of Lender to name any of the Borrower Parties, as a party defendant in any action or suit for foreclosure and sale under the Mortgage; (iii) otherwise affect the validity or enforceability of any guaranty made in connection with the Loan or any rights and remedies of Lender thereunder; (iv) impair the right of Lender to obtain the appointment of a receiver; (v) impair the enforcement of the Assignment of Leases and Rents; or (vi) constitute a waiver of the right of Lender to enforce the liability and obligation of Borrower (but not against any members of Borrower (other than Guarantor to the extent provided in the Non-Recourse Guaranty) or their direct or indirect constituent members or partners or any other Person), by money judgment or otherwise, to the extent of any loss, damage, cost, expense, liability, claim or other obligation (but excluding any punitive, consequential or speculative damages) incurred by Lender (including attorneys’ fees and costs reasonably incurred) arising out of or in connection with the following:
(a) fraud the debt evidenced by the Note or intentional misrepresentation by Borrower the Loan Agreement or Guarantor in connection with the Loan;
(b) intentional physical waste of the Property (including, but not limited to, waste due to gross negligence) by Borrower or any affiliate thereof; provided, however, such physical waste shall exclude wear and tear to the Property that occurs in the ordinary course of business of the Property by Borrower or any affiliate thereof;
(c) the material breach of any representationother obligations evidenced by the Note, warrantythe Loan Agreement, covenant or indemnification provision in the Environmental Indemnity or in this Agreement concerning Environmental Laws, Hazardous Substances and Asbestos;
(d) the removal or disposal by Borrower or any affiliate thereof of any portion of the Property after an Event of Default has occurred and while it is continuing, unless such portion of the Property is replaced by an item of equal or greater value as determined by Lender in its reasonable discretion;
(e) the misapplication or conversion by Borrower or any affiliate thereof of (i) any insurance proceeds paid by reason of any loss, damage or destruction to the Property, (ii) any awards or other amounts received in connection with the condemnation of all or a portion of the Property, (iii) any Rents following an Event of Default or (iv) any Rents paid more than one (1) month in advance;
(f) failure to pay charges for labor or materials or taxes or other charges that can create liens superior to the lien of the Mortgage on any portion of the Property unless such taxes or other charges are being contested in accordance herewith or such taxes or charges have been delivered to Lender in accordance with Section 3.3 hereof or Borrower has complied with Section 5.2 hereof; and
(g) any security deposits collected by Borrower or any affiliate thereof with respect to the Property which are not delivered to Lender upon a foreclosure of the Property or action in lieu thereof, except to the extent any such security deposits were applied in accordance with the terms and conditions of any of the Leases prior to the occurrence of the Event of Default that gave rise to such foreclosure or action in lieu thereof. Notwithstanding anything to the contrary in any of the Loan Documents or (b) Lenders' liens, security interests, rights and remedies (including, without limitation, the remedies of foreclosure and/or sale) with respect to the Mortgaged Property or any other property, security, collateral and/or assets (including the proceeds thereof) encumbered, pledged or assigned by the Mortgages or any other security for the Loan. In addition, the foregoing limitation on liability shall not limit anyone's obligations or be applicable with respect to: (i) Lender shall not be deemed to have waived liability under any right which Lender may have under Section 506(a), 506(b), 1111(bguaranty(ies) or indemnity(ies) delivered or afforded to Lenders; (ii) any fraud or material misrepresentation; (iii) taxes of any kind (whether characterized as transfer, gains or other provisions taxes) payable in connection with the foreclosure sale of the U.S. Bankruptcy Code to file a claim for the full amount Mortgaged Property, irrespective of who pays such taxes; (iv) application of any proceeds of the Debt or Loan to require that all collateral shall continue to secure all of the Debt owing to Lender any purpose other than as provided in accordance with the Loan Documents, and (ii) the Debt shall become fully recourse to Borrower (but not its members (other than Guarantor solely to the extent provided in the Non-Recourse Guaranty) or other direct or indirect constituent members or partners or any other Person) in the event that: (A) the first full Monthly Debt Service Payment Amount (as defined in the Note) under the Note is not paid when due; (B) other than in connection with a default under subsection (x) of the definition of Special Purpose Bankruptcy Remote Entity set forth in Schedule 5 hereto, Borrower fails to maintain its status as a Special Purpose Bankruptcy Remote Entity in accordance with the provisions of this Agreement and such failure results in the substantive consolidation of Borrower with another Person; (C) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any subordinate financing or other voluntary lien encumbering the Property; (D) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any assignment, transfer, or conveyance of the Property or any interest therein as and to the extent required by this Agreement or the Mortgage; or (E) (1) if any petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law, shall be filed by Borrower or Guarantor, or (2) if Borrower or Guarantor files an answer consenting to, or otherwise joining in, any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law filed against it by any other Person, or is found pursuant to a final, unappealable order of a court of competent jurisdiction to have solicited or caused to be solicited creditors to file any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law against Borrower or Guarantor, or (3) if Borrower or Guarantor are found, pursuant to a final unappealable order of a court of competent jurisdiction, to have been in collusion with creditors that initiate a bankruptcy action or proceeding against Borrower or Guarantor or (F) an Event of Default described in Section 8.1(s) hereof shall have occurred.;
Appears in 1 contract
Exculpation. Subject to Except as expressly provided in this Section 9.2, the qualifications below, Lender Administrative Agent shall not enforce the liability and obligation of Borrower or its constituent members, partners, shareholders, directors, employees or agents or the direct or indirect constituent members, partners, shareholders, directors, employees or agents thereof (collectively, the “Borrower Parties”) or any other Person, Borrowers to perform and observe the obligations contained in the Notes, this Agreement, the Note Mortgages or any of the other Loan Documents by any action or proceeding wherein a money judgment shall be sought against any of the Borrower Parties or any other PersonBorrowers, except that Lender the Administrative Agent may bring a foreclosure action, an action for specific performance or any other appropriate action or proceeding to enable Lender the Administrative Agent to enforce and realize upon its interest (on behalf of the PropertySecured Parties) under the Notes, this Agreement, the Rents Mortgages and the other Loan Documents, or in the Properties, the Rents, or any other collateral given to Lender the Administrative Agent or the Collateral Agent (not in its individual capacity but solely in its capacity as Collateral Agent on behalf of the Administrative Agent for the benefit of the Secured Parties) pursuant to this Agreement and the other Loan Documents; provided, however, that, except as specifically provided herein, any judgment in any such action or proceeding shall be enforceable against the Borrower Parties Borrowers only to the extent of their each Borrower’s interest in the its Property, in the Rents and in any other collateral given to Lenderthe Administrative Agent or the Collateral Agent (not in its individual capacity but solely in its capacity as Collateral Agent on behalf of the Administrative Agent for the benefit of the Secured Parties), and each Lender, by accepting the Notes, this Agreement, the Note Mortgage and the other Loan Documents, agrees that it the Administrative Agent shall not sxx sue for, seek or demand any deficiency judgment or any other money judgment against any direct or indirect member, manager, shareholder, partner, beneficiary or other owner of beneficial ownership interests in Borrowers, or any director, officer, employee, trustee or agent or any of the Borrower Parties or any other Person foregoing (each, an “Exculpated Party” and, collectively, the “Exculpated Parties”), in any such action or proceeding under or by reason of or under or in connection with the Notes, this Agreement, the Note Mortgages or any of the other Loan Documents. The provisions of this paragraph Section 9.2 shall not, however, (ia) constitute a waiver, release or impairment of any obligation evidenced or secured by this Agreement, the Note or any of the other Loan Documents; (iib) impair the right of Lender the Administrative Agent to name any of the Borrower Parties, as a party defendant in any action or suit for foreclosure and sale under the such Borrower’s related Mortgage; (iiic) affect the validity or enforceability of or any guaranty made in connection with the Loan or any of the rights and remedies of Lender the Administrative Agent or the Lenders thereunder; (ivd) impair the right of Lender the Administrative Agent to obtain the appointment of a receiver; (ve) impair the enforcement of any of the Assignment Assignments of Leases and RentsLeases; (f) constitute a prohibition against the Administrative Agent (on behalf of the Secured Parties) to seek a deficiency judgment against any Borrower in order to fully realize the security granted by it under its applicable Mortgage or to commence any other appropriate action or proceeding in order for the Administrative Agent or Collateral Agent (not in its individual capacity but solely in its capacity as Collateral Agent on behalf of the Administrative Agent for the benefit of the Secured Parties) to exercise their remedies against all of the Properties; or (vig) constitute a waiver of the right of Lender Lenders to enforce the liability and obligation of Borrower (but not against any members of Borrower (other than Guarantor to the extent provided in the Non-Recourse Guaranty) or their direct or indirect constituent members or partners or any other Person)Borrowers, by money judgment or otherwise, to the extent of any loss, damage, cost, expense, liability, claim or other obligation (but excluding any punitive, consequential or speculative damages) incurred by Lender Xxxxxxx (including attorneys’ fees and costs reasonably incurred) arising out of or in connection with the following:
(ai) fraud or intentional misrepresentation by Borrower the Limited Guarantor, any Loan Party or any subsidiary or Affiliate of the Limited Guarantor or any Loan Party in connection with the Loan, the Collateral or any Loan Document;
(bii) intentional physical waste the willful misconduct, bad faith or gross negligence of the Property (includingLimited Guarantor, but not limited to, waste due to gross negligence) by Borrower any Loan Party or any affiliate thereof; provided, however, such physical waste shall exclude wear and tear to the Property that occurs in the ordinary course of business subsidiary or Affiliate of the Property by Borrower Limited Guarantor or any affiliate thereofLoan Party in connection with the Loan, the Collateral or any Loan Document;
(ciii) the material breach by any Loan Party of any representation, warranty, covenant or indemnification provision in the Environmental Indemnity or in this Agreement any Loan Document concerning Environmental Laws, Hazardous Substances or asbestos and Asbestosany indemnification of the Administrative Agent, any Lender or Collateral Agent with respect thereto in any such Loan Document;
(iv) the misapplication, misappropriation or conversion by any Loan Party or any Affiliate of any Loan Party of any collections or proceeds with respect to any Collateral, including the proceeds of any related insurance payable to any Borrower or funds received by any Borrower for payment of taxes or any other amounts, in each case to the extent required to be deposited into the Collection Account or any other account established and maintained pursuant to the Loan Documents;
(v) any intentional material waste of any Financed Property;
(vi) the sale, conveyance or other disposition of any Financed Property or conveyance or release of any Financed Property in breach of any Loan Document;
(vii) any Loan Party fails to obtain Administrative Agent’s prior written consent to any incurrence of any debt not permitted under the Loan Documents;
(viii) the imposition of any consensual Lien or other encumbrance on any Financed Property or other Collateral other than that which is expressly permitted under the terms of the Loan Documents; or
(ix) any litigation or other legal proceeding related to the Collateral or the other obligations of the Loan Parties or the Limited Guarantor pursuant to the Loan Documents filed by a Loan Party, the Company or any subsidiary or Affiliate of any Loan Party or the Company that delays, opposes, impedes, obstructs, hinders, enjoins or otherwise interferes with or frustrates the efforts of the Administrative Agent to exercise any rights and remedies available to the Administrative Agent as provided in the Loan Documents, in each case if filed in bad faith (and expressly excluding any good faith assertion of rights, defense or counterclaims).
(a) the Loan Parties cease to be controlled by the Limited Guarantor, in each case to the extent constituting a violation of the Loan Documents that constitutes an Event of Default (other than a violation of any required notice or other administrative requirements); (b) any Loan Party files a voluntary petition under the Bankruptcy Code or any other Federal or state bankruptcy law; (c) any Loan Party or any Affiliate of any Loan Party, files, or joins in the filing of, an involuntary petition against any Loan Party under the Bankruptcy Code or any other Federal or state bankruptcy or insolvency law, or solicits or causes to be solicited (or if any Loan Party otherwise colludes with) petitioning creditors for any involuntary petition against any Loan Party from any person other than a petition filed by the Administrative Agent or any Lender; (d) any Loan Party files an answer consenting to or joining in any involuntary petition filed against any Loan Party by any other person under the removal or disposal by Borrower Bankruptcy Code or any affiliate thereof other Federal or state bankruptcy or insolvency law, or solicits or causes to be solicited petitioning creditors for any involuntary petition against any Loan Party from any Person other than a petition filed or joined by the Administrative Agent or any Lender; (e) any Loan Party or any Affiliate of any Loan Party consents to or joins in an application for the appointment of a custodian, receiver, trustee, or examiner for any Loan Party or any portion of the Property after an Event of Default has occurred and while it is continuing, unless such portion of Collateral other than if required by the Property is replaced by an item of equal Administrative Agent or greater value as determined by Lender in its reasonable discretion;
a Lender; or (e) the misapplication or conversion by Borrower or any affiliate thereof of (if) any insurance proceeds paid by reason Loan Party making an assignment for the benefit of creditors, or admitting, in writing or in any losslegal proceeding, damage its insolvency or destruction inability to the Property, pay its debts as they become due; (ii) any awards or other amounts received in connection with the condemnation of all or a portion of the Property, (iii) any Rents following an Event of Default or (iv) any Rents paid more than one (1) month in advance;
(f) failure to pay charges for labor or materials or taxes or other charges that can create liens superior to the lien of the Mortgage on any portion of the Property unless such taxes or other charges are being contested in accordance herewith or such taxes or charges have been delivered to Lender in accordance with Section 3.3 hereof or Borrower has complied with Section 5.2 hereof; and
(g) any security deposits collected by Borrower or any affiliate thereof with respect to the Property which are not delivered to Lender upon a foreclosure of the Property or action in lieu thereof, except to the extent any such security deposits were applied in accordance with the terms and conditions of any of the Leases prior to the occurrence of the Event of Default that gave rise to such foreclosure or action in lieu thereof. Notwithstanding anything to the contrary in any of the Loan Documents (i) Lender shall not be deemed to have waived any right which Lender may have under Section 506(a), 506(b), 1111(b) or any other provisions of the U.S. Bankruptcy Code to file a claim for the full amount of the Debt or to require that all collateral shall continue to secure all of the Debt owing to Lender in accordance with the Loan Documents, and (ii) the Debt shall become fully recourse to Borrower (but not its members (other than Guarantor solely to the extent provided in the Non-Recourse Guaranty) or other direct or indirect constituent members or partners or any other Person) in the event that: (A) if the first full Monthly Debt Service Payment Amount (as defined in monthly payment of principal and interest on the Note) under the Note Loan is not paid when duedue (subject to any applicable cure period); (Biii) other than in connection with a default under subsection (x) if any Loan Party fails to permit on-site inspections of the definition of Special Purpose Bankruptcy Remote Entity set forth in Schedule 5 heretoits Property, Borrower fails to provide financial information, fails to maintain its status as a Special Purpose Bankruptcy Remote Entity “special purpose entity” or fails to appoint a new property manager upon the request of Lenders as and if permitted under this Agreement, each as required by, and in accordance with with, the terms and provisions (including any applicable notice and cure provisions) of this Agreement and such failure results in or the substantive consolidation of Borrower with another PersonMortgages; (Civ) except as otherwise permitted pursuant to the if any Loan Documents, Borrower Party fails to obtain Lender’s Lenders’ prior written consent to any subordinate financing Indebtedness or other voluntary lien Lien encumbering its Property as and if required by, and in accordance with the Propertyterms and provisions (including any applicable notice and cure provisions) of this Agreement; or (Dv) except as otherwise permitted pursuant to the if any Loan Documents, Borrower Party fails to obtain Lender’s Xxxxxxx’ prior written consent to any assignment, transfer, or conveyance of the Property or any interest therein transfer as and to the extent if required by this Agreement or the Mortgage; or (E) (1) if any petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law, shall be filed by Borrower or Guarantor, or (2) if Borrower or Guarantor files an answer consenting to, or otherwise joining in, any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law filed against it by any other Person, or is found pursuant to a final, unappealable order of a court of competent jurisdiction to have solicited or caused to be solicited creditors to file any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law against Borrower or Guarantor, or (3) if Borrower or Guarantor are found, pursuant to a final unappealable order of a court of competent jurisdiction, to have been in collusion with creditors that initiate a bankruptcy action or proceeding against Borrower or Guarantor or (F) an Event of Default described in Section 8.1(s) hereof shall have occurredMortgages.
Appears in 1 contract
Exculpation. Subject (a) Notwithstanding anything to the contrary contained in this Agreement or any of the other Loan Documents, but subject to the qualifications expressly set forth below, Lender shall not enforce the liability and obligation of Borrower or its constituent members, partners, shareholders, directors, employees or agents or the direct or indirect constituent members, partners, shareholders, directors, employees or agents thereof (collectively, the “Borrower Parties”) or any other Person, to perform and observe the obligations contained in the Note, this Agreement, the Note Security Instruments or any of the other Loan Documents by any action or proceeding wherein a money judgment or any deficiency judgment or other judgment establishing personal liability shall be sought against Borrower or any principal, director, officer, employee, beneficiary, shareholder, partner, member, manager, trustee, agent, or Affiliate of Borrower or any legal representatives, successors or assigns of any of the Borrower Parties or any other Personforegoing (collectively, the “Exculpated Parties”), except that Lender may bring a foreclosure action, an action for specific performance or any other appropriate action or proceeding to enable Lender to enforce and realize upon its interest under the PropertyNote, this Agreement, the Rents Security Instruments and the other Loan Documents, or in the Properties, the Rents, or any other collateral given to Lender pursuant to this Agreement and the other Loan Documents; provided, however, that, except as specifically provided herein, any judgment in any such action or proceeding shall be enforceable against the Borrower Parties only to the extent of their Borrower’s interest in the PropertyProperties, in the Rents and in any other collateral given to Lender, and Lender, by accepting the Note, this Agreement, the Note Security Instruments and the other Loan Documents, agrees that it shall not sxx xxx for, seek or demand any deficiency judgment against Borrower or any of the Borrower Exculpated Parties or any other Person in any such action or proceeding under or by reason of or under or in connection with the Note, this Agreement, the Note Security Instruments or any of the other Loan Documents. The provisions of this paragraph Section 13.1(a) shall not, however, (i1) constitute a waiver, release or impairment of any obligation evidenced or secured by this Agreement, the Note or any of the other Loan Documents, subject in all respects to the foregoing limitation of remedies and personal liability; (ii2) impair the right of Lender to name any of the Borrower Parties, as a party defendant in any action or suit for foreclosure and sale under any Security Instrument, to the Mortgageextent necessary under applicable law, and for the limited purposes of, effecting such foreclosure;; (iii3) affect the validity or enforceability of any indemnity or guaranty made (including, without limitation, indemnities set forth in Article 12 hereof, Section 11.2 hereof, in the Guaranty and the Environmental Indemnity) executed by Borrower or Guarantor in connection with the Loan or any of the rights and remedies of Lender thereunderthereunder (including, without limitation, Lender’s right to enforce said rights and remedies against Borrower and/or Guarantor (as applicable) personally and without the effect of the exculpatory provisions of this Article 13); (iv4) impair the right rights of Lender to (A) obtain the appointment of a receiver; and/or (vB) enforce its rights and remedies provided in Articles 8 and 9 hereof; (5) impair the enforcement of the Assignment of Leases Leases; (6) impair the right of Lender to enforce Section 4.12(e) of this Agreement; (7) constitute a prohibition against Lender to seek a deficiency judgment against Borrower for the sole and Rentslimited purpose, and only to the extent required under applicable law, of realizing upon the security granted by any Security Instrument or to commence any other appropriate action or proceeding in order for Lender to exercise its remedies against any Individual Property; or (vi) 8) constitute a waiver of the right of Lender to enforce the liability and obligation of Borrower (but not against any members of Borrower (other than Guarantor to the extent provided in the Non-Recourse Guaranty) or their direct or indirect constituent members or partners or any other Person)Borrower, by money judgment or otherwise, to the extent of any loss, damage, cost, expense, liability, claim or other obligation (but excluding any punitive, consequential or speculative damages) Loss incurred by Lender (including attorneys’ fees and costs reasonably incurred) arising out of or in connection with the following:
(ai) fraud or intentional misrepresentation by any Borrower or Guarantor Party in connection with the Loan;
(bii) intentional physical waste the gross negligence or willful misconduct of the Property (including, but not limited to, waste due to gross negligence) by any Borrower or any affiliate thereof; provided, however, such physical waste shall exclude wear and tear to the Property that occurs in the ordinary course of business of the Property by Borrower or any affiliate thereofParty;
(ciii) any litigation or other legal proceeding related to the material breach Debt filed by any Borrower Party that delays, opposes, impedes, obstructs, hinders, enjoins or otherwise interferes with or frustrates the efforts of any representationLender, warrantyfollowing an Event of Default, covenant to accelerate the Loan, foreclose upon the Property, seek a receiver or indemnification provision in enforce the Guaranty and Environmental Indemnity or in this Agreement concerning Environmental Laws, Hazardous Substances and AsbestosIndemnity;
(div) waste to any Individual Property caused by the intentional acts or intentional omissions of any Borrower Party and/or the removal or disposal by Borrower or any affiliate thereof of any portion of the any Individual Property after an Event of Default has occurred and while it is continuing, unless such portion of the Property is replaced by an item of equal or greater value as determined by Lender in its reasonable discretionDefault;
(ev) the misapplication misapplication, misappropriation or conversion by any Borrower or any affiliate thereof Party of (iA) any insurance proceeds paid by reason of any loss, damage or destruction to the any Individual Property, (iiB) any awards Awards or other amounts received in connection with the condemnation Condemnation of all or a portion of the any Individual Property, (iiiC) any Rents following an Event of Default or (ivD) any Tenant security deposits or Rents paid more than one (1) month collected in advance;
(fvi) failure to pay Taxes, charges for labor or materials or taxes or other charges that can create liens superior to the lien of the Mortgage on any portion of the any Individual Property unless such taxes or other charges are being contested in accordance herewith or such taxes or charges have been delivered to Lender in accordance with Section 3.3 hereof or Borrower has complied with Section 5.2 the terms and provisions hereof; and;
(gvii) failure to pay Insurance Premiums, to maintain the Policies in full force and effect and/or to provide Lender evidence of the same, in each case, as expressly provided herein;
(viii) any security deposits, advance deposits or any other deposits collected by Borrower or any affiliate thereof with respect to the any Individual Property which are not delivered to Lender upon a foreclosure of the such Individual Property or action in lieu thereof, except to the extent any such security deposits were applied in accordance with the terms and conditions of any of the Leases prior to the occurrence of the Event of Default that gave rise to such foreclosure or action in lieu thereof. ;
(ix) any tax on the making and/or recording of any Security Instrument, the Note or any of the other Loan Documents or any transfer or similar taxes (whether due upon the making of the same or upon Lender’s exercise of its remedies under the Loan Documents), but excluding any income, franchise or other similar taxes;
(x) the seizure or forfeiture of any Individual Property, or any portion thereof, or Borrower’s interest therein, resulting from criminal wrongdoing by any Borrower Party;
(xi) the failure to make any True Up Payment (but only to the extent that the Property generated net operating income for the immediately preceding twelve (12) month period sufficient to pay the same);
(xii) Intentionally omitted;
(xiii) Borrower fails to comply with its obligations to deposit revenues derived from the Properties into the Restricted Account in accordance with Section 9.2(a) hereof; and for purposes of this subsection (xiii), Losses shall be deemed to mean any funds not so deposited by Borrower into the Restricted Account);
(xiv) any default or breach by Borrower or any SPE Component Entity (if any) of any of the provisions set forth in Article 5 hereof (other than a default or breach of the terms of Section 5.1(a)(i), (ii), (iii), (iv), (vi), (vii) and (xi) hereof)); or
(xv) Section 11.1 or Section 11.6 hereof is violated or breached.
(b) Notwithstanding anything to the contrary in this Agreement, the Note or any of the Loan Documents Documents, (iA) Lender shall not be deemed to have waived any right which Lender may have under Section 506(a), 506(b), 1111(b) or any other provisions of the U.S. Bankruptcy Code to file a claim for the full amount of the Debt or to require that all collateral shall continue to secure all of the Debt owing to Lender in accordance with the Loan Documents, and (iiB) the Debt shall become be fully recourse to Borrower (but not its members (other than Guarantor solely to the extent provided in the Non-Recourse Guaranty) or other direct or indirect constituent members or partners or any other Person) in the event that: (Ai) the first full Monthly Debt Service Payment Amount (as defined in the Note) monthly payment of principal and interest under the Note is not paid when due; (Bii) other than in connection with a any default under subsection or breach by Borrower or any SPE Component Entity (xif any) of the definition of Special Purpose Bankruptcy Remote Entity set forth in Schedule 5 hereto, Borrower fails to maintain its status as a Special Purpose Bankruptcy Remote Entity in accordance with the provisions of this Agreement and such failure results Section 5.1(a)(i), (ii), (iii), (iv), (vi), (vii) or (xi), (iii) any representation, warranty or covenant contained in the substantive consolidation of Borrower with another PersonArticle 6 hereof is violated or breached; (Ciii) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any subordinate financing or other voluntary lien encumbering the Property; (D) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any assignment, transfer, or conveyance of the Property or any interest therein as and to the extent required by this Agreement or the Mortgage; or (E) (1) if any petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law, shall be filed by Borrower or Guarantor, or (2) if Borrower or Guarantor files an answer consenting to, or otherwise joining in, any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law filed against it by any other Person, or is found pursuant to a final, unappealable order of a court of competent jurisdiction to have solicited or caused to be solicited creditors to file any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law against Borrower or Guarantor, or (3) if Borrower or Guarantor are found, pursuant to a final unappealable order of a court of competent jurisdiction, to have been in collusion with creditors that initiate a bankruptcy action or proceeding against Borrower or Guarantor or (F) an Bankruptcy Event of Default described in Section 8.1(s) hereof shall have occurredoccurs.
Appears in 1 contract
Exculpation. Subject to the qualifications below, Lender Administrative Agent, on behalf of Lender, shall not enforce the liability and obligation of Borrower or its constituent members, partners, shareholders, directors, employees or agents or the direct or indirect constituent members, partners, shareholders, directors, employees or agents thereof (collectively, the “Borrower Parties”) or any other Person, to perform and observe the obligations contained in the Note, this Agreement, the Note Mortgages or any of the other Loan Documents by any action or proceeding wherein a money judgment shall be sought against any of the Borrower Parties or any other PersonBorrower, except that Lender Administrative Agent, on behalf of Lender, may bring a foreclosure action, an action for specific performance or any other appropriate action or proceeding to enable Lender Administrative Agent to enforce and realize upon Xxxxxx’s interest under the PropertyNote, this Agreement, the Rents Mortgages and the other Loan Documents, or in the Properties, the Rents, or any other collateral given to Lender pursuant to this Agreement and the other Loan Documents; provided, however, that, except as specifically provided herein, any judgment in any such action or proceeding shall be enforceable against the Borrower Parties only to the extent of their Xxxxxxxx’s interest in the PropertyProperties, in the Rents and in any other collateral given to LenderAdministrative Agent, on behalf of Xxxxxx, pursuant to the Loan Documents, and Administrative Agent and Lender, by accepting the Note, this Agreement, the Note Mortgages and the other Loan Documents, agrees that it shall not sxx sue for, seek or demand any deficiency judgment against any of the Borrower Parties or any other Person in any such action or proceeding under under, or by reason of of, or in connection with with, the Note, this Agreement, the Note Mortgages or any of the other Loan Documents. The provisions of this paragraph Section shall not, however, (iA) constitute a waiver, release or impairment of any obligation evidenced or secured by this Agreement, the Note or any of the other Loan Documents; (iiB) impair the right of Lender Administrative Agent, on behalf of Xxxxxx, to name any of the Borrower Parties, as a party defendant in any action or suit for foreclosure and sale under any of the MortgageMortgages; (iiiC) affect the validity or enforceability of any guaranty made in connection with the Loan Guaranty or the Environmental Indemnity or any of the rights and remedies of Administrative Agent and Lender thereunder; (ivD) impair the right of Lender Administrative Agent, on behalf of Xxxxxx, to obtain the appointment of a receiver; (vE) impair the enforcement of the Assignment collateral assignment of Leases leases and Rentsrents contained in the Mortgage; (F) constitute a prohibition against Administrative Agent, on behalf of Lender, to seek a deficiency judgment against Borrower in order to fully realize the security granted by each of the Mortgages or to commence any other appropriate action or proceeding in order for Administrative Agent to exercise its remedies against all of the Properties; or (viG) constitute a waiver of the right of Administrative Agent and Lender to enforce the liability and obligation of Borrower (but not against any members of Borrower (other than Guarantor to the extent provided in the Non-Recourse Guaranty) or their direct or indirect constituent members or partners or any other Person)Borrower, by money judgment or otherwise, to the extent of any loss, damage, cost, expense, liability, claim or other obligation (but excluding any punitive, consequential or speculative damages) Losses to the extent actually incurred by Administrative Agent or Lender (including attorneys’ fees and costs reasonably incurred) arising out of or in connection with the following:
(a) fraud or intentional misrepresentation by Borrower or Guarantor in connection with the Loan;
(b) intentional physical waste of the Property (including, but not limited to, waste due to gross negligence) by Borrower or any affiliate thereof; provided, however, such physical waste shall exclude wear and tear to the Property that occurs in the ordinary course of business of the Property by Borrower or any affiliate thereof;
(c) the material breach of any representation, warranty, covenant or indemnification provision in the Environmental Indemnity or in this Agreement concerning Environmental Laws, Hazardous Substances and Asbestos;
(d) the removal or disposal by Borrower or any affiliate thereof of any portion of the Property after an Event of Default has occurred and while it is continuing, unless such portion of the Property is replaced by an item of equal or greater value as determined by Lender in its reasonable discretion;
(e) the misapplication or conversion by Borrower or any affiliate thereof of (i) any insurance proceeds paid by reason of any loss, damage or destruction to the Property, (ii) any awards or other amounts received in connection with the condemnation of all or a portion of the Property, (iii) any Rents following an Event of Default or (iv) any Rents paid more than one (1) month in advance;
(f) failure to pay charges for labor or materials or taxes or other charges that can create liens superior to the lien of the Mortgage on any portion of the Property unless such taxes or other charges are being contested in accordance herewith or such taxes or charges have been delivered to Lender in accordance with Section 3.3 hereof or Borrower has complied with Section 5.2 hereof; and
(g) any security deposits collected by Borrower or any affiliate thereof with respect to the Property which are not delivered to Lender upon a foreclosure of the Property or action in lieu thereof, except to the extent any such security deposits were applied in accordance with the terms and conditions of any of the Leases prior to the occurrence of the Event of Default that gave rise to such foreclosure or action in lieu thereof. Notwithstanding anything to the contrary in any of the Loan Documents (i) Lender shall not be deemed to have waived any right which Lender may have under Section 506(a), 506(b), 1111(b) or any other provisions of the U.S. Bankruptcy Code to file a claim for the full amount of the Debt or to require that all collateral shall continue to secure all of the Debt owing to Lender in accordance with the Loan Documents, and (ii) the Debt shall become fully recourse to Borrower (but not its members (other than Guarantor solely to the extent provided in the Non-Recourse Guaranty) or other direct or indirect constituent members or partners or any other Person) in the event that: (A) the first full Monthly Debt Service Payment Amount (as defined in the Note) under the Note is not paid when due; (B) other than in connection with a default under subsection (x) of the definition of Special Purpose Bankruptcy Remote Entity set forth in Schedule 5 hereto, Borrower fails to maintain its status as a Special Purpose Bankruptcy Remote Entity in accordance with the provisions of this Agreement and such failure results in the substantive consolidation of Borrower with another Person; (C) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any subordinate financing or other voluntary lien encumbering the Property; (D) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any assignment, transfer, or conveyance of the Property or any interest therein as and to the extent required by this Agreement or the Mortgage; or (E) (1) if any petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law, shall be filed by Borrower or Guarantor, or (2) if Borrower or Guarantor files an answer consenting to, or otherwise joining in, any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law filed against it by any other Person, or is found pursuant to a final, unappealable order of a court of competent jurisdiction to have solicited or caused to be solicited creditors to file any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law against Borrower or Guarantor, or (3) if Borrower or Guarantor are found, pursuant to a final unappealable order of a court of competent jurisdiction, to have been in collusion with creditors that initiate a bankruptcy action or proceeding against Borrower or Guarantor or (F) an Event of Default described in Section 8.1(s) hereof shall have occurred.
Appears in 1 contract
Exculpation. (a) Subject to the qualifications belowset forth in this Section 9.3, Lender shall not enforce the liability and obligation of Borrower or its constituent members, partners, shareholders, directors, employees or agents or the direct or indirect constituent members, partners, shareholders, directors, employees or agents thereof (collectively, the “Borrower Parties”) or any other Person, Operating Lessee to perform and observe the obligations contained in the Note, this Agreement, the Note Mortgage or any of the other Loan Documents by any action or proceeding wherein a money judgment shall be sought against any of the Borrower Parties or any other PersonOperating Lessee, except that Lender may bring a foreclosure action, an action for specific performance or any other appropriate action or proceeding to enable Lender to enforce and realize upon its interest under the Note, this Agreement, the Mortgage and the other Loan Documents, or in the Property, the Rents IP Collateral, the Rents, or any other collateral given to Lender pursuant to this Agreement and the other Loan Documents; provided, however, that, except as specifically provided herein, any judgment in any such action or proceeding shall be enforceable against the Borrower Parties or Operating Lessee only to the extent of their Borrower’s or Operating Lessee’s interest in the Property, in the Rents Rents, in the IP Collateral and in any other collateral given to Lender, and Lender, by accepting the Note, this Agreement, the Note Mortgage and the other Loan Documents, agrees that it shall not sxx xxx for, seek or demand any deficiency judgment against any of the Borrower Parties or any other Person in any such action or proceeding under or by reason of or under or in connection with the Note, this Agreement, the Note Mortgage or any of the other Loan Documents. The provisions of this paragraph Section shall not, however, (i) constitute a waiver, release or impairment of any obligation evidenced or secured by this Agreement, the Note or any of the other Loan Documents; (ii) impair the right of Lender to name any of the Borrower Parties, or Operating Lessee as a party defendant in any action or suit for foreclosure and sale under the MortgageMortgage or the IP Security Agreement; (iii) affect the validity or enforceability of or any guaranty made in connection with the Loan or any of the rights and remedies of Lender thereunder; (iv) impair the right of Lender to obtain the appointment of a receiver; (v) impair the enforcement of any assignment of leases contained in the Assignment of Leases and RentsMortgage; or (vi) constitute a waiver of prohibition against Lender to seek a deficiency judgment against Borrower or Operating Lessee in order to fully realize the security granted by the Mortgage or the IP Security Agreement or to commence any other appropriate action or proceeding in order for Lender to exercise its remedies against the Property or IP Collateral;
(b) Nothing contained herein shall in any manner or way release, affect or impair any right of Lender to enforce the liability and obligation of Borrower (but not against any members of Borrower (other than Guarantor to the extent provided in the Non-Recourse Guaranty) or their direct or indirect constituent members or partners or any other Person)Operating Lessee, by money judgment or otherwise, to the extent of any loss, damage, cost, expense, liability, claim or other obligation (but excluding any punitive, consequential or speculative damages) to the extent actually incurred by Lender (including reasonable attorneys’ fees and costs reasonably incurred) arising out of or incurred in connection with the followingfollowing on the part of Guarantor, Borrower, Operating Lessee or any Affiliated Manager until such time, if any, as a Transfer resulting from, the exercise of Lender’s rights under the Loan Documents, any Mezzanine Lender’s rights under any Mezzanine Loan Documents or the consummation of any remedial or enforcement action by the Lender or any holder of any Mezzanine Loan of the collateral for the Loan or any Mezzanine Loan, including, without limitation, any foreclosure, deed-in-lieu or assignment in lieu of foreclosure and the exercise of any rights of Lender or Mezzanine Lender under the Mortgage, the IP Security Agreement or any Pledge Agreement, including, without limitation, any right to vote any pledged securities or any right to replace officers and directors of any Person (collectively, a “Foreclosure”), that in each case results in Borrower, any Mezzanine Borrower, Operating Lessee or any Affiliated Manager, as applicable not being under the Control of Guarantor:
(ai) fraud or intentional misrepresentation by Borrower or Guarantor Operating Lessee in connection with the Loan;
(bii) intentional willful misconduct of Borrower, Operating Lessee or Guarantor that results in physical damage or waste of the Property (including, but not limited to, waste due to gross negligence) by Borrower or any affiliate thereof; provided, however, such physical waste shall exclude wear and tear to the Property that occurs in the ordinary course of business of the Property by Borrower or any affiliate thereofProperty;
(c) the material breach of any representation, warranty, covenant or indemnification provision in the Environmental Indemnity or in this Agreement concerning Environmental Laws, Hazardous Substances and Asbestos;
(diii) the removal or disposal by Borrower disposal, by, or any affiliate thereof on behalf of Borrower, Operating Lessee or Guarantor, of any portion of the Property after or IP Collateral during the continuance of an Event of Default has occurred and while it is continuing, unless such portion of the Property is replaced by an item of equal or greater value as determined by Lender in its reasonable discretionDefault;
(eiv) the misapplication misappropriation or conversion by Borrower or any affiliate thereof Operating Lessee of (iA) any insurance proceeds Insurance Proceeds paid by reason of any loss, damage or destruction to the PropertyCasualty, (iiB) any awards or other amounts Awards received in connection with the condemnation a Condemnation of all or a portion of the Property, (iiiC) any Rents following an Event of Default Default, or (ivD) any Rents paid more than one (1) month in advance;
(fv) failure to pay charges for labor a material breach of any representation, warranty or materials covenant set forth in Section 4.1.30(e) or taxes or Section 5.1.28 hereof, including without limitation, if Borrower incurs Indebtedness other charges that can create liens superior to the lien than Permitted Debt in violation of the Mortgage on any portion of the Property unless such taxes or other charges are being contested in accordance herewith or such taxes or charges have been delivered to Lender in accordance with Section 3.3 hereof or Borrower has complied with Section 5.2 hereof5.1.28(b);
(vi) intentionally omitted; and
(gvii) if Borrower fails to obtain Lender’s prior written consent to any security deposits collected by Borrower Sale, Pledge or any affiliate thereof with respect to the Property which are not delivered to Lender upon a foreclosure Transfer of the Property or action in lieu thereof, except to the extent any such security deposits were applied in accordance with the terms and conditions of any IP Collateral or a Transfer of the Leases prior to ownership interests in Borrower, in each case as required by Section 5.2.10 hereof, and in each case, excluding Permitted Transfers, Permitted Encumbrances and any other Lien expressly permitted under the occurrence Loan Documents. For the avoidance of the Event doubt, a Transfer resulting from a Foreclosure shall not be a Transfer in violation of Default that gave rise to such foreclosure or action in lieu thereof. Section 5.2.10 hereof.
(c) Notwithstanding anything to the contrary in this Agreement, the Note or any of the Loan Documents Documents, (iI) Lender shall not be deemed to have waived any right which Lender may have under Section 506(a), 506(b), 1111(b) or any other provisions of the U.S. Bankruptcy Code to file a claim for the full amount of the Debt secured by the Mortgage or to require that all collateral shall continue to secure all of the Debt owing to Lender in accordance with the Loan Documents, and (iiII) the Debt shall become be fully recourse to Borrower (but not its members (other than Guarantor solely to the extent provided in the Non-Recourse Guaranty) or other direct or indirect constituent members or partners or any other Person) in the event thatof: (A) the first full Monthly Debt Service Payment Amount (as defined in the Note) Borrower, Operating Lessee or Operating Lessee GP filing a voluntary petition under the Note is not paid when dueBankruptcy Code or any other Federal or state bankruptcy or insolvency law; (B) the filing of an involuntary petition against Borrower, Operating Lessee or Operating Lessee GP under the Bankruptcy Code or any other than Federal or state bankruptcy or insolvency law in connection with a default under subsection (x) of the definition of Special Purpose Bankruptcy Remote Entity set forth in Schedule 5 heretowhich Borrower, Borrower fails Operating Lessee or Operating Lessee GP colludes with, or otherwise assists such Person, or solicits or causes to maintain its status as a Special Purpose Bankruptcy Remote Entity in accordance with the provisions of this Agreement and such failure results in the substantive consolidation of Borrower with another be solicited petitioning creditors for any involuntary petition against Borrower, Operating Lessee or Operating Lessee GP from any Person; (C) except as Borrower, Operating Lessee or Operating Lessee GP filing an answer consenting to or otherwise permitted acquiescing in or joining in any involuntary petition filed against it, by any other Person under the Bankruptcy Code or any other Federal or state bankruptcy or insolvency law or (D) Borrower, Operating Lessee or Operating Lessee GP consenting to or acquiescing in or joining in an application for the appointment of a custodian, receiver, trustee, or examiner for Borrower, Operating Lessee or Operating Lessee GP or any portion of the Property or the IP Collateral.
(d) From and after a Permitted Assumption, the Debt shall be fully recourse to Borrower and Guarantor (or any substitute guarantor pursuant to the Loan Documents, Borrower fails Section 5.2.10(e)(xi)) hereof for Borrower’s failure to obtain Lender’s prior written consent to any subordinate financing Sale or Pledge of the IP Collateral or the Property or a Transfer of the ownership interests in any Restricted Party as required by Section 5.2.10 hereof and excluding Permitted Transfers, Permitted Encumbrances and any other voluntary lien encumbering the Property; (D) except as otherwise Lien expressly permitted pursuant to under the Loan Documents. For the avoidance of doubt, Borrower fails to obtain Lender’s prior written consent to any assignment, transfer, or conveyance a Transfer resulting from a Foreclosure shall not be a Transfer in violation of the Property or any interest therein as and to the extent required by this Agreement or the Mortgage; or (E) (1) if any petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law, shall be filed by Borrower or Guarantor, or (2) if Borrower or Guarantor files an answer consenting to, or otherwise joining in, any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law filed against it by any other Person, or is found pursuant to a final, unappealable order of a court of competent jurisdiction to have solicited or caused to be solicited creditors to file any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law against Borrower or Guarantor, or (3) if Borrower or Guarantor are found, pursuant to a final unappealable order of a court of competent jurisdiction, to have been in collusion with creditors that initiate a bankruptcy action or proceeding against Borrower or Guarantor or (F) an Event of Default described in Section 8.1(s) hereof shall have occurred.5.2.10 hereof;
Appears in 1 contract
Exculpation. (a) Subject to the qualifications below, Lender shall not enforce the liability and obligation of Borrower or its constituent members, partners, shareholders, directors, employees or agents or the direct or indirect constituent members, partners, shareholders, directors, employees or agents thereof (collectively, the “Borrower Parties”) or any other Person, to perform and observe the obligations contained in the Note, this Agreement, the Note Security Instrument or any of the other Loan Documents by any action or proceeding wherein a money judgment or any deficiency judgment or other judgment establishing personal liability shall be sought against Borrower, any of its Affiliates and/or any of their respective principals, directors, officers, employees, beneficiaries, shareholders, partners, members, trustees, agents, or any legal representatives, successors or assigns of any of the Borrower Parties or any other Personforegoing (collectively, the “Exculpated Parties”), except that Lender may bring a foreclosure action, an action for specific performance or any other appropriate action or proceeding to enable Lender to enforce and realize upon its interest under the PropertyNote, this Agreement, the Rents Security Instruments and the other Loan Documents, or in any Individual Property (or any portion thereof), the Rents, or any other collateral given to Lender pursuant to this Agreement and the other Loan Documents; provided, however, that, except as specifically provided herein, any judgment in any such action or proceeding shall be enforceable against the Borrower Parties only to the extent of their Borrower’s interest in the PropertyProperties, in the Rents and in any other collateral given to Lender, and Lender, by accepting the Note, this Agreement, the Note Security Instruments and the other Loan Documents, agrees that it shall not sxx sue for, seek or demand any deficiency judgment against Borrower or any of the Borrower Exculpated Parties or any other Person in any such action or proceeding under or by reason of or under or in connection with the Note, this Agreement, the Note Security Instruments or any of the other Loan Documents. The provisions of this paragraph Section shall not, however, (i1) constitute a waiver, release or impairment of any obligation evidenced or secured by this Agreement, the Note or any of the other Loan Documents; (ii2) impair the right of Lender to name any of the Borrower Parties, as a party defendant in any action or suit for foreclosure and sale under the Mortgageany Security Instrument; (iii3) affect the validity or enforceability of any indemnity, guaranty or similar instrument (including, without limitation, indemnities set forth in Article 12 hereof, Section 11.2 hereof, in the Guaranty and the Environmental Indemnity) made in connection with the Loan or any of the rights and remedies of Lender thereunderthereunder (including, without limitation, Lxxxxx’s right to enforce said rights and remedies against Bxxxxxxx and/or Guarantor (as applicable) personally and without the effect of the exculpatory provisions of this Article 13); (iv4) impair the rights of Lender to (A) obtain the appointment of a receiver and/or (B) enforce its rights and remedies provided in Articles 8 and 9 hereof; (5) impair the enforcement of the assignment of leases and rents contained in the Security Instruments and in any other Loan Documents; (6) impair the right of Lender to obtain the appointment enforce Section 4.12(e) of a receiverthis Agreement; (v7) impair constitute a prohibition against Lender to seek a deficiency judgment against Borrower in order to fully realize the enforcement of security granted by the Assignment of Leases and RentsSecurity Instrument or to commence any other appropriate action or proceeding in order for Lender to exercise its remedies against the Property (or any portion thereof); or (vi) 8) constitute a waiver of the right of Lender to enforce the liability and obligation of Borrower (but not against any members of Borrower (other than Guarantor to the extent provided in the Non-Recourse Guaranty) or their direct or indirect constituent members or partners or any other Person)Borrower, by money judgment or otherwise, to the extent of any loss, damage, cost, expense, liability, claim or other obligation (but excluding any punitive, consequential or speculative damages) Loss incurred by Lender (including reasonable attorneys’ fees and costs reasonably incurred) arising out of or in connection with the following:
(ai) fraud or intentional misrepresentation by any Borrower or Guarantor Party in connection with the Loan;
(bii) intentional physical waste the gross negligence or willful misconduct of the Property any Borrower Party (including, but not limited towithout limitation, waste due any litigation or other legal proceeding related to gross negligence) the Debt filed by any Borrower Party or any affiliate thereof; providedother action of any Borrower Party that delays, howeveropposes, such physical waste shall exclude wear impedes, obstructs, hinders, enjoins or otherwise interferes with or frustrates the efforts of Lender to exercise any rights and tear remedies available to the Property that occurs Lender as provided herein and in the ordinary course of business of the Property by Borrower or any affiliate thereofother Loan Documents);
(ciii) physical waste to any Individual Property (or any portion thereof) caused by the material breach intentional acts or intentional omissions of any representation, warranty, covenant or indemnification provision in the Environmental Indemnity or in this Agreement concerning Environmental Laws, Hazardous Substances and Asbestos;
(d) Borrower Party and/or the removal or disposal by a Borrower Party or any affiliate thereof its Affiliates of any portion of any Individual Property during the Property after continuance of an Event of Default has occurred and while it is continuing, unless such portion of the Property is replaced by an item of equal or greater value as determined by Lender in its reasonable discretionDefault;
(eiv) the misapplication misapplication, misappropriation or conversion by any Borrower or any affiliate thereof Party of (iA) any insurance proceeds paid by reason of any loss, damage or destruction to the Propertyany Individual Property (or any portion thereof), (iiB) any awards Awards or other amounts received in connection with the condemnation Condemnation of all or a portion of the any Individual Property, (iiiC) any Rents, (D) any Security Deposits or Rents following an Event of Default collected in advance or (ivE) any Rents paid more than one other monetary collateral for the Loan (1including, without limitation, any Reserve Funds and/or any portion thereof disbursed to (or at the direction of) month in advanceBorrower);
(fv) failure to pay Taxes, charges for labor or materials or taxes or other charges that can create liens superior to the lien of the Mortgage on any portion of the Property unless in accordance with the terms and provisions hereof; provided, however, Borrower shall have no liability under this subsection (v) if (A) such taxes Taxes, charges for labor or materials or other charges that can create liens are being contested in accordance herewith or such taxes or charges have been delivered to Lender in accordance with Section 3.3 the terms and conditions hereof or (B) sufficient cash flow is not available from the Properties to pay such amounts; provided, that, in no instance shall Borrower has complied with Section 5.2 hereof; andbe released from any liability pursuant to this clause (v) to the extent (1) such insufficiency of cash flow arises from the intentional misappropriation or conversion of Rent by any Borrower Party or (2) Borrower incurred such charges after the occurrence and during the continuance of an Event of Default;
(gvi) failure to pay Insurance Premiums, to maintain the Policies in full force and effect and/or to provide Lender evidence of the same, in each case, as expressly provided herein; provided, however, Borrower shall have no liability under this subsection (vi) if sufficient cash flow is not available from the Properties to pay such amounts; provided, that, in no instance shall Borrower be released from any liability pursuant to this clause (vi) to the extent such insufficiency of cash flow arises from the intentional misappropriation or conversion of Rent by any Borrower Party;
(vii) any security deposits collected by Borrower or any affiliate thereof with respect to the Property Security Deposits which are not delivered to Lender upon a foreclosure of within the Property or action in lieu thereof, timeframe required hereunder except to the extent any such security deposits Security Deposits were applied in accordance with the terms and conditions of any of the Leases prior to the occurrence of the applicable Event of Default that gave rise Default. For purposes of clarification, for a Security Deposit to be deemed “delivered to Lender” in connection with the foregoing, the same must be in the form of cash or in a letter of credit solely in Lxxxxx’s name;
(viii) any violation or breach by any Borrower Party of any applicable law mandating the forfeiture or seizure of any Individual Property (or any portion thereof and/or interest therein);
(ix) the failure to make any REMIC Payment as and when required herein;
(x) any indemnity obligations of Lender to Bank under the Restricted Account Agreement;
(xi) Borrower fails to comply with the Cash Management Provision or fails to comply with any limitations on instructing the property manager, each as required by and in accordance with, as applicable, the terms and provisions of, this Agreement and the other Loan Documents;
(xii) without limiting Section 13.1(b)(ii) below, any violation or breach of any representation, warranty or covenants contained in Article 5;
(xiii) without limiting Section 13.1(b)(iii) below, any violation or breach of any representation, warranty or covenants contained in Article 6;
(xiv) any failure of Lender to be paid the Release Price for the Individual Property known as One Ally Center upon a total Condemnation of such foreclosure Individual Property; and/or
(xv) (1) any (A) material amendment or action modification or (B) termination or cancellation of any Leased Fee Lease by Borrower, in lieu thereof. each case without Lender’s consent, which consent is to be given or withheld in accordance with the terms of Section 4.14 hereof or (2) any termination or cancellation of any Leased Fee Lease due to a default by Borrower thereunder.
(b) Notwithstanding anything to the contrary in this Agreement, the Note or any of the Loan Documents Documents, (iA) Lender shall not be deemed to have waived any right which Lender may have under Section 506(a), 506(b), 1111(b) or any other provisions of the U.S. Bankruptcy Code to file a claim for the full amount of the Debt or to require that all collateral shall continue to secure all of the Debt owing to Lender in accordance with the Loan Documents, and (iiB) the Debt shall become be fully recourse to Borrower (but not its members (other than Guarantor solely to the extent provided in the Non-Recourse Guaranty) or other direct or indirect constituent members or partners or any other Person) in the event that: (Ai) the first full Monthly Debt Service Payment Amount (as defined in the Note) monthly payment of principal and interest under the Note is not paid when due; (Bii) other than any representation, warranty or covenant contained in connection with a default under subsection (x) of the definition of Special Purpose Bankruptcy Remote Entity set forth in Schedule Article 5 hereto, Borrower fails to maintain its status as a Special Purpose Bankruptcy Remote Entity in accordance with the provisions of this Agreement and such failure is violation or breached which results in the substantive consolidation of Borrower or any SPE Component with another any other Person; (Ciii) except as otherwise permitted pursuant to the Loan Documents, Borrower and/or any SPE Component Entity fails to obtain Lender’s prior written consent to any subordinate financing or other voluntary lien encumbering the Property; (D) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to transfer of any assignment, transfer, or conveyance material portion of the any Individual Property or any interest therein as and voluntary act that causes a change (directly or indirectly) in the ownership of any Borrower and/or any SPE Component Entity to the extent such ownership change required by Lender’s consent under this Agreement or the MortgageAgreement; (iv) a Bankruptcy Event occurs; or (Ev) the Ground Lease is terminated, cancelled or otherwise ceases to exist or is rejected in a proceeding under the Bankruptcy Code and/or any Creditors Rights Laws (1provided, however, that liability for breach of this clause (v) if any petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law, shall be filed by limited to the Release Price of such Individual Property subject to the Ground Lease together with Lxxxxx’s fees, costs and expenses in connection therewith (including Lxxxxx’s reasonable attorneys’ fees and expenses) and (II) Borrower or Guarantor, or (2) if Borrower or Guarantor files an answer consenting to, or otherwise joining in, any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law filed against it by any other Person, or is found pursuant shall have no liability with respect to a final, unappealable order rejection of the Ground Lease by a court ground lessor in a proceeding of competent jurisdiction the ground lessor under the Bankruptcy Code and/or any Creditors Rights Laws to have solicited or caused the extent that (x) Borrower retains its rights under such Ground Lease and (y) Lender’s first priority lien in the leasehold estate created by such Ground Lease (subject only to be solicited creditors to file any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law against Borrower or Guarantor, or (3Permitted Encumbrances) if Borrower or Guarantor are found, pursuant to a final unappealable order of a court of competent jurisdiction, to have been in collusion with creditors that initiate a bankruptcy action or proceeding against Borrower or Guarantor or (F) an Event of Default described in Section 8.1(s) hereof shall have occurredis unimpaired.
Appears in 1 contract
Samples: Loan Agreement (Istar Inc.)
Exculpation. Subject to the qualifications belowrights of the Banks against FTX and FCX under the FTX Guaranty and the FCX Guaranty, Lender each of the Banks agree for themselves and their heirs, successors and assigns that any claim against FM Properties which may arise for payment of the principal of and interest on the Notes and for fees, expenses and all other amounts payable by FM Properties hereunder shall not enforce be made only against and shall be limited to FM Properties and that no judgment, order or execution entered in any suit, action or proceeding, whether legal or equitable, with respect to payment of the liability and obligation Notes shall be obtained or enforced against any partner of Borrower or its constituent members, partners, shareholders, directors, employees or agents FM Properties or the direct assets of any partner of FM Properties, any right to proceed against the partners of FM Properties as a result of their capacity as a partner of FM Properties, individually or indirect constituent memberstheir respective assets in respect of payment of the Notes being hereby expressly waived, partnersrenounced and remitted by each of the Banks for themselves and their heirs, shareholderssuccessors and assigns. Nothing in this Subsection 3.4, directorshowever, employees or agents thereof (collectively, shall be deemed to be a waiver by any of the “Borrower Parties”) Banks or any other Person, to perform and observe the obligations contained in this Agreement, the Note or any holders of the other Loan Documents by Notes of any action or proceeding wherein a money judgment shall be sought right to proceed against any of the Borrower Parties partners of FM Properties or their respective assets in respect of claims other than for payment of the Notes, which such Banks or other holders may have against such partner or assets, and nothing in this Subsection 3.4 shall be construed so as to prevent any of the Banks or any other Person, except that Lender may bring a foreclosure holders of the Notes from commencing any action, an action for specific performance or any other appropriate action suit or proceeding with respect to, or causing legal papers to enable Lender to enforce and realize upon the Property, the Rents or any other collateral given to Lender pursuant to this Agreement and the other Loan Documents; provided, however, that, except as specifically provided hereinbe served upon, any judgment in any such action or proceeding shall be enforceable against partner of FM Properties for the Borrower Parties only to the extent purpose of their interest in the Propertyobtaining jurisdiction over FM Properties. Furthermore, the Rents and in any other collateral given to Lender, and Lender, by accepting this Agreement, the Note and the other Loan Documents, agrees that it shall not sxx for, seek or demand any deficiency judgment against any of the Borrower Parties or any other Person in any such action or proceeding under or by reason of or in connection with this Agreement, the Note or any of the other Loan Documents. The provisions of this paragraph shall not, however, (i) constitute a waiver, release or impairment of any obligation evidenced or secured by this Agreement, the Note or any of the other Loan Documents; (ii) impair the right of Lender to name any of the Borrower Parties, as a party defendant in any action or suit for foreclosure and sale under the Mortgage; (iii) affect the validity or enforceability of any guaranty made in connection with the Loan or any rights and remedies of Lender thereunder; (iv) impair the right of Lender to obtain the appointment of a receiver; (v) impair the enforcement of the Assignment of Leases and Rents; or (vi) constitute a waiver of the right of Lender to enforce the liability and obligation of Borrower (but not against any members of Borrower (other than Guarantor to the extent provided in the Non-Recourse Guaranty) or their direct or indirect constituent members or partners or any other Person), by money judgment or otherwise, to the extent of any loss, damage, cost, expense, liability, claim or other obligation (but excluding any punitive, consequential or speculative damages) incurred by Lender (including attorneys’ fees and costs reasonably incurred) arising out of or in connection with the following:
(a) fraud or intentional misrepresentation by Borrower or Guarantor in connection with the Loan;
(b) intentional physical waste of the Property (including, but not limited to, waste due to gross negligence) by Borrower or any affiliate thereof; provided, however, such physical waste shall exclude wear and tear to the Property that occurs in the ordinary course of business of the Property by Borrower or any affiliate thereof;
(c) the material breach of any representation, warranty, covenant or indemnification provision in the Environmental Indemnity or nothing contained in this Agreement concerning Environmental Laws, Hazardous Substances and Asbestos;
(d) the removal or disposal by Borrower or any affiliate thereof of any portion of the Property after an Event of Default has occurred and while it is continuing, unless such portion of the Property is replaced by an item of equal or greater value as determined by Lender in its reasonable discretion;
(e) the misapplication or conversion by Borrower or any affiliate thereof of (i) any insurance proceeds paid by reason of any loss, damage or destruction to the Property, (ii) any awards or other amounts received in connection with the condemnation of all or a portion of the Property, (iii) any Rents following an Event of Default or (iv) any Rents paid more than one (1) month in advance;
(f) failure to pay charges for labor or materials or taxes or other charges that can create liens superior to the lien of the Mortgage on any portion of the Property unless such taxes or other charges are being contested in accordance herewith or such taxes or charges have been delivered to Lender in accordance with Section 3.3 hereof or Borrower has complied with Section 5.2 hereof; and
(g) any security deposits collected by Borrower or any affiliate thereof with respect to the Property which are not delivered to Lender upon a foreclosure of the Property or action in lieu thereof, except to the extent any such security deposits were applied in accordance with the terms and conditions of any of the Leases prior to the occurrence of the Event of Default that gave rise to such foreclosure or action in lieu thereof. Notwithstanding anything to the contrary in any of the Loan Documents (i) Lender Subsection 3.4 shall not be deemed to have waived diminish, waive or affect in any right which Lender may have under Section 506(a), 506(b), 1111(b) or any other provisions manner the rights of the U.S. Bankruptcy Code to file a claim for the full amount of the Debt Agent, Banks, or to require that all collateral shall continue to secure all of the Debt owing to Lender in accordance with the Loan DocumentsBanks' assigns, against FTX, FCX or their assets under and (ii) the Debt shall become fully recourse to Borrower (but not its members (other than Guarantor solely to the extent provided in the Non-Recourse Guaranty) or other direct or indirect constituent members or partners or any other Person) in the event that: (A) the first full Monthly Debt Service Payment Amount (as defined in the Note) under the Note is not paid when due; (B) other than in connection with a default under subsection (x) of the definition of Special Purpose Bankruptcy Remote Entity set forth in Schedule 5 hereto, Borrower fails to maintain its status as a Special Purpose Bankruptcy Remote Entity in accordance with the provisions of this Agreement and such failure results in the substantive consolidation of Borrower with another Person; (C) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to FTX Guaranty or the FCX Guaranty or any subordinate financing Liens or other voluntary lien encumbering the Property; (D) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any assignment, transfer, or conveyance rights of the Property Agent or any interest therein Banks as and to contemplated or provided for in the extent required by this Agreement or the Mortgage; or (E) (1) if any petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law, shall be filed by Borrower or Guarantor, or (2) if Borrower or Guarantor files an answer consenting to, or otherwise joining in, any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law filed against it by any other Person, or is found pursuant to a final, unappealable order of a court of competent jurisdiction to have solicited or caused to be solicited creditors to file any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law against Borrower or Guarantor, or (3) if Borrower or Guarantor are found, pursuant to a final unappealable order of a court of competent jurisdiction, to have been in collusion with creditors that initiate a bankruptcy action or proceeding against Borrower or Guarantor or (F) an Event of Default described in Section 8.1(s) hereof shall have occurredIntercreditor Agreements.
Appears in 1 contract
Exculpation. Subject to the qualifications below, Lender shall not enforce the liability and obligation of Borrower or its constituent members, partners, shareholders, directors, employees or agents or the direct or indirect constituent members, partners, shareholders, directors, employees or agents thereof (collectively, the “"Borrower Parties”") or any other Person, to perform and observe the obligations contained in this Agreement, the Note or any of the other Loan Documents by any action or proceeding wherein a money judgment shall be sought against any of the Borrower Parties or any other Person, except that Lender may bring a foreclosure action, an action for specific performance or any other appropriate action or proceeding to enable Lender to enforce and realize upon the Property, the Rents or any other collateral given to Lender pursuant to this Agreement and the other Loan Documents; provided, however, that, except as specifically provided herein, any judgment in any such action or proceeding shall be enforceable against the Borrower Parties only to the extent of their interest in the Property, the Rents and in any other collateral given to Lender, and Lender, by accepting this Agreement, the Note and the other Loan Documents, agrees that it shall not sxx xxx for, seek or demand any deficiency judgment against any of the Borrower Parties or any other Person in any such action or proceeding under or by reason of or in connection with this Agreement, the Note or any of the other Loan Documents. The provisions of this paragraph shall not, however, (i) constitute a waiver, release or impairment of any obligation evidenced or secured by this Agreement, the Note or any of the other Loan Documents; (ii) impair the right of Lender to name any of the Borrower Parties, as a party defendant in any action or suit for foreclosure and sale under the Mortgage; (iii) affect the validity or enforceability of any guaranty made in connection with the Loan or any rights and remedies of Lender thereunder; (iv) impair the right of Lender to obtain the appointment of a receiver; (v) impair the enforcement of the Assignment of Leases and RentsRents executed in connection herewith; or (vi) constitute a waiver of the right of Lender to enforce the liability and obligation of Borrower (but not against any members of Borrower (other than Guarantor to the extent provided in the Non-Recourse Guaranty) or their direct or indirect constituent members or partners or any other Person), by money judgment or otherwise, to the extent of any loss, damage, cost, expense, liability, claim or other obligation (but excluding any punitive, consequential or speculative damages) incurred by Lender (including attorneys’ ' fees and costs reasonably incurred) arising out of or in connection with the following:
(a) fraud or intentional misrepresentation by Borrower or any Guarantor in connection with the Loan;
(b) intentional physical waste of the Property (including, but not limited to, waste due to gross negligence) by Borrower or any affiliate thereof; provided, however, such physical waste shall exclude wear and tear to the Property that occurs in the ordinary course of business of the Property by Borrower or any affiliate thereof;
(c) the material breach of any representation, warranty, covenant or indemnification provision in the that certain Environmental Indemnity and Hazardous Substance Indemnification Agreement of even date herewith given by Borrower to Lender or in this Agreement concerning Environmental Laws, Hazardous Substances and Asbestos;
(d) the removal or disposal by Borrower or any affiliate thereof of any portion of the Property after an Event of Default has occurred and while it is continuing, unless such portion of the Property is replaced by an item of equal or greater value as determined by Lender in its reasonable discretion;
(e) the misapplication or conversion by Borrower or any affiliate thereof of of
(i) any insurance proceeds paid by reason of any loss, damage or destruction to the Property, ,
(ii) any awards or other amounts received in connection with the condemnation of all or a portion of the Property, (iii) any Rents following an Event of Default or (iv) any Rents paid more than one (1) month in advance;
(f) failure to pay charges for labor or materials or taxes or other charges that can create liens superior to the lien of the Mortgage on any portion of the Property unless such taxes or other charges are being contested in accordance herewith or such taxes or charges have been delivered to Lender in accordance with Section 3.3 hereof or Borrower has complied with Section 5.2 hereof5.2; and
(g) any security deposits collected by Borrower or any affiliate thereof with respect to the Property which are not delivered to Lender upon a foreclosure of the Property or action in lieu thereof, except to the extent any such security deposits were applied in accordance with the terms and conditions of any of the Leases prior to the occurrence of the Event of Default that gave rise to such foreclosure or action in lieu thereof. Notwithstanding anything to the contrary in any of the Loan Documents Documents
(i) Lender shall not be deemed to have waived any right which Lender may have under Section 506(a), 506(b), 1111(b) or any other provisions of the U.S. Bankruptcy Code to file a claim for the full amount of the Debt or to require that all collateral shall continue to secure all of the Debt owing to Lender in accordance with the Loan Documents, and (ii) the Debt shall become fully recourse to Borrower (but not its members (other than Guarantor solely to the extent provided in the Non-Recourse Guaranty) or other direct or indirect constituent members or partners or any other Person) in the event that: (A) the first full Monthly Debt Service Payment Amount (as defined in the Note) under the Note is not paid when due; (B) other than in connection with a default under subsection (x) of the definition of Special Purpose Bankruptcy Remote Entity set forth in Schedule 5 heretohereof, Borrower fails to maintain its status as a Special Purpose Bankruptcy Remote Entity in accordance with the provisions of this Agreement and such failure results in the substantive consolidation of Borrower with another Person; (C) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s 's prior written consent to any subordinate financing or other voluntary lien encumbering the Property; (D) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s 's prior written consent to any assignment, transfer, or conveyance of the Property or any interest therein as and to the extent required by this Agreement or the Mortgage; or (E) )
(1) a receiver (other than a receiver appointed by Lender), liquidator or trustee of Borrower or Guarantor shall be appointed which is not dismissed within ninety (90) days, or (2) if any petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law, shall be filed by Borrower or Guarantor, or (23) if Borrower or Guarantor files an answer consenting to, or otherwise joining in, any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law filed against it by any other Person, or is found pursuant to a final, unappealable order of a court of competent jurisdiction to have solicited or caused to be solicited creditors to file any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law against Borrower or Guarantor, or (34) if Borrower or Guarantor are found, pursuant to a final unappealable order of a court of competent jurisdiction, to have been in collusion with creditors that initiate a bankruptcy action or proceeding against Borrower or Guarantor or (F) an Event of Default described in Section 8.1(s) hereof shall have occurredGuarantor.
Appears in 1 contract
Exculpation. (a) Subject to the qualifications belowset forth in this Section 9.3, Lender shall not enforce the liability and obligation of any Individual Borrower or its constituent members, partners, shareholders, directors, employees or agents or the direct or indirect constituent members, partners, shareholders, directors, employees or agents thereof (collectively, the “Borrower Parties”) or any other Person, Individual Operating Lessee to perform and observe the its respective obligations contained in this Agreement, the Note (as to Borrower) or this Agreement or any of the other Loan Documents Document to which it is a party by any action or proceeding wherein a money judgment shall be sought against any of the Individual Borrower Parties or any other PersonIndividual Operating Lessee, except that Lender may bring a foreclosure action, an action for specific performance or any other appropriate action or proceeding to enable Lender to enforce and realize upon its interest under the PropertyNote, this Agreement, the Rents Mortgages and the other Loan Documents, or in the Properties, the Rents, or any other collateral given to Lender pursuant to this Agreement and the other Loan Documents; provided, however, that, except as specifically provided herein, any judgment in any such action or proceeding shall be enforceable against the any Individual Borrower Parties or Individual Operating Lessee only to the extent of their such Individual Borrower’s or Individual Operating Lessee’s interest in the applicable Individual Property, in the Rents and in any other collateral given to Lender, and Lender, by accepting the Note, this Agreement, the Note Mortgages and the other Loan Documents, agrees that it shall not sxx xxx for, seek or demand any deficiency judgment against any of the Individual Borrower Parties or any other Person Individual Operating Lessee in any such action or proceeding under or by reason of or under or in connection with the Note, this Agreement, the Note Mortgages or any of the other Loan Documents. The provisions of this paragraph Section shall not, however, (i) constitute a waiver, release or impairment of any obligation evidenced or secured by this Agreement, the Note or any of the other Loan Documents; (ii) impair the right of Lender to name any of the Individual Borrower Parties, or Individual Operating Lessee as a party defendant in any action or suit for foreclosure and sale under any of the MortgageMortgages; (iii) affect the validity or enforceability of or any guaranty made in connection with the Loan or any of the rights and remedies of Lender thereunder; (iv) impair the right of Lender to obtain the appointment of a receiver; (v) impair the enforcement of any assignment of leases contained in any of the Assignment of Leases and RentsMortgages; or (vi) constitute a waiver prohibition against Lender to seek a deficiency judgment against Borrower in order to fully realize the security granted by each of the Mortgages or to commence any other appropriate action or proceeding in order for Lender to exercise its remedies against any or all of the Properties.
(b) Nothing contained herein shall in any manner or way release, affect or impair the right of Lender to enforce the liability and obligation of any Individual Borrower (but not against any members of Borrower (other than Guarantor to the extent provided in the Non-Recourse Guaranty) or their direct or indirect constituent members or partners or any other Person)Individual Operating Lessee, by money judgment or otherwise, to the extent of any loss, damage, cost, expense, liability, claim or other obligation (but excluding any punitive, consequential or speculative damages) to the extent actually incurred by Lender (including reasonable attorneys’ fees and costs reasonably incurred) arising out of or incurred in connection with the followingfollowing actions or omissions on the part of Guarantor, any Individual Borrower or Individual Operating Lessee, any Affiliated Manager or any Affiliate of Guarantor, any Individual Borrower or Individual Operating Lessee or any Affiliated Manager:
(ai) fraud or intentional material and willful misrepresentation by Borrower any Individual Borrower, any Individual Operating Lessee, any Principal, Guarantor, any Affiliated Manager or Guarantor any Affiliate of any Individual Borrower, any Individual Operating Lessee, any Principal, Guarantor, any Affiliated Manager in connection with the Loan;
(bii) intentional physical waste of the Property (includingwillful misconduct by any Individual Borrower, but not limited toany Individual Operating Lessee, waste due to gross negligence) by Borrower any Principal, Guarantor, any Affiliated Manager or any affiliate thereof; providedAffiliate of any Individual Borrower, howeverany Individual Operating Lessee, such any Principal, Guarantor, any Affiliated Manager that results in physical damage or waste shall exclude wear and tear to the Property that occurs in the ordinary course of business of the Property by Borrower or any affiliate thereofIndividual Property;
(c) the material breach of any representation, warranty, covenant or indemnification provision in the Environmental Indemnity or in this Agreement concerning Environmental Laws, Hazardous Substances and Asbestos;
(diii) the removal or disposal by Borrower by, or on behalf, of any Individual Borrower, any Individual Operating Lessee, any Principal, Guarantor, any Affiliated Manager or any affiliate thereof Affiliate of any Individual Borrower, any Individual Operating Lessee, any Principal, Guarantor, any Affiliated Manager, of any portion of any Individual Property during the Property after continuance of an Event of Default has occurred and while it is continuing, unless such portion of the Property is replaced by an item of equal or greater value as determined by Lender in its reasonable discretionDefault;
(eiv) the misapplication misappropriation or conversion by Borrower any Individual Borrower, any Individual Operating Lessee, any Principal, Guarantor, any Affiliated Manager or any affiliate thereof Affiliate of any Individual Borrower, any Individual Operating Lessee, any Principal, Guarantor, any Affiliated Manager of (iA) any insurance proceeds Insurance Proceeds paid by reason of any loss, damage or destruction to the Propertya Casualty, (iiB) any awards or other amounts Awards received in connection with the condemnation a Condemnation of all or a portion of the any Individual Property, (iiiC) any Rents following during the continuance of an Event of Default Default, or (ivD) any Rents paid more than one (1) month in advance;
(fv) failure a material breach of any covenant set forth in Section 5.1.28(a), (b) or (c) hereof;
(vi) if Borrower fails to pay charges for labor or materials or taxes obtain Lender’s prior written consent to any financing or other charges that can create liens superior to the lien of the Mortgage on voluntary Lien encumbering any portion of the Property unless Individual Property, if such taxes or other charges are being contested in accordance herewith or such taxes or charges have been delivered to Lender consent is required in accordance with Section 3.3 hereof or Borrower has complied with Section 5.2 hereof; andthe applicable provisions of the Loan Documents;
(gvii) any security deposits collected by if Borrower or Operating Lessee fails to obtain Lender’s prior written consent to any affiliate thereof with respect to the Property which are not delivered to Lender upon a foreclosure Transfer of the Property or action in lieu thereof, except to the extent any such security deposits were applied in accordance with the terms and conditions of any a Transfer of the Leases prior to ownership interests in Borrower or Operating Lessee, in each case, as required by Section 5.2.10 hereof, and in each case, excluding Permitted Transfers; or
(viii) the occurrence of the Event of Default that gave rise to such foreclosure or action in lieu thereof. an ERISA Event.
(c) Notwithstanding anything to the contrary in this Agreement, the Note or any of the Loan Documents Documents, (i) Lender shall not be deemed to have waived any right which Lender may have under Section 506(a), 506(b), 1111(b) or any other provisions of the U.S. Bankruptcy Code to file a claim for the full amount of the Debt secured by the Mortgages or to require that all collateral shall continue to secure all of the Debt owing to Lender in accordance with the Loan Documents, and (ii) the Debt shall become be fully recourse to Borrower (but not its members (other than Guarantor solely to the extent provided in the Non-Recourse Guaranty) or other direct or indirect constituent members or partners or any other Person) in the event thatof: (A) the first full Monthly Debt Service Payment Amount (as defined in the Note) any Individual Borrower, Individual Operating Lessee or Principal filing a voluntary petition under the Note is not paid when dueBankruptcy Code or any other Federal or state bankruptcy or insolvency law; (B) the filing of an involuntary petition by any Person (other than Lender) against any Individual Borrower, Individual Operating Lessee or Principal under the Bankruptcy Code or any other Federal or state bankruptcy or insolvency law in connection with a default under subsection which any Individual Borrower, any Individual Operating Lessee, any Principal or Guarantor or any Affiliate of any Individual Borrower, any Individual Operating Lessee, any Principal or Guarantor colludes with, or otherwise assists, such Person, or solicits or causes to be solicited petitioning creditors for any involuntary petition against any Individual Borrower, Individual Operating Lessee or Principal, by any Person (x) of the definition of Special Purpose Bankruptcy Remote Entity set forth in Schedule 5 hereto, Borrower fails to maintain its status as a Special Purpose Bankruptcy Remote Entity in accordance with the provisions of this Agreement and such failure results in the substantive consolidation of Borrower with another Personother than Lender); (C) except as any Individual Borrower, Individual Operating Lessee, any Principal or Guarantor or any Affiliate of any Individual Borrower, Individual Operating Lessee, any Principal or Guarantor filing an answer consenting to or otherwise permitted pursuant to acquiescing in or joining in any involuntary petition filed against any Individual Borrower, Individual Operating Lessee or any Principal, by any other Person (other than Lender) under the Loan Documents, Borrower fails to obtain Lender’s prior written consent to Bankruptcy Code or any subordinate financing other Federal or other voluntary lien encumbering the Property; state bankruptcy or insolvency law or (D) except as otherwise permitted pursuant any Individual Borrower, Individual Operating Lessee, Principal consenting to or acquiescing in or joining in an application for the Loan Documentsappointment of a custodian, Borrower fails to obtain Lender’s prior written consent to any assignmentreceiver, transfertrustee, or conveyance of the Property or examiner for any interest therein as and to the extent required by this Agreement or the Mortgage; or (E) (1) if Individual Borrower, Individual Operating Lessee, any petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy lawPrincipal, or any similar federal or state law, shall be filed by Borrower or Guarantor, or (2) if Borrower or Guarantor files an answer consenting to, or otherwise joining in, any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law filed against it by any other Person, or is found pursuant to a final, unappealable order portion of a court of competent jurisdiction to have solicited or caused to be solicited creditors to file any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law against Borrower or Guarantor, or (3) if Borrower or Guarantor are found, pursuant to a final unappealable order of a court of competent jurisdiction, to have been in collusion with creditors that initiate a bankruptcy action or proceeding against Borrower or Guarantor or (F) an Event of Default described in Section 8.1(s) hereof shall have occurredthe Properties.
Appears in 1 contract
Exculpation. Subject to the qualifications below, Lender shall not enforce the liability and obligation of Borrower or its constituent members, partners, shareholders, directors, employees or agents or the direct or indirect constituent members, partners, shareholders, directors, employees or agents thereof (collectively, the “Borrower Parties”) or any other Person, to perform and observe the obligations contained in the Note, this Agreement, the Note Mortgage or any of the other Loan Documents by any action or proceeding wherein a money judgment or any deficiency judgment or other judgment establishing personal liability shall be sought against Borrower or any principal, director, officer, employee, beneficiary, shareholder, partner, member, trustee, agent, or affiliate of Borrower (but specifically excluding Guarantor) or any legal representatives, successors or assigns of any of the Borrower Parties or any other Personforegoing (collectively, the “Exculpated Parties”), except that Lender may bring a foreclosure action, an action for specific performance or any other appropriate action or proceeding to enable Lender to enforce and realize upon its interest under the Note, this Agreement, the Mortgage and the other Loan Documents, or in any Property, the Rents Rents, or any other collateral given to Lender pursuant to this Agreement and the other Loan Documents; provided, however, that, except as specifically provided herein, any judgment in any such action or proceeding shall be enforceable against the Borrower Parties only to the extent of their Borrower’s interest in the PropertyCollective Properties, in the Rents and in any other collateral given to Lender, and Lender, by accepting the Note, this Agreement, the Note Mortgage and the other Loan Documents, agrees that it shall not sxx for, seek or demand any deficiency judgment against Borrower or any of the Borrower Parties or any other Person Exculpated Parties, in any such action or proceeding under or by reason of or under or in connection with the Note, this Agreement, the Note Mortgage or any of the other Loan Documents. The provisions of this paragraph Section shall not, however, (ia) constitute a waiver, release or impairment of any obligation evidenced or secured by this Agreement, the Note or any of the other Loan Documents; (iib) impair the right of Lender to name any of the Borrower Parties, as a party defendant in any action or suit for foreclosure and sale under the Mortgage; (iiic) affect the validity or enforceability of any guaranty indemnity, guaranty, or similar instrument made in connection with the Loan or any of the rights and remedies of Lender thereunder; (ivd) impair the right of Lender to obtain the appointment of a receiver; (ve) impair the enforcement of the Assignment Mortgage; (f) impair the right of Leases and RentsLender to enforce the provisions of the Guaranty or the Environmental Indemnity; (g) constitute a prohibition against Lender to seek a deficiency judgment against Borrower in order to fully realize on any security given by Borrower in connection with the Loan or to commence any other appropriate action or proceeding in order for Lender to exercise its remedies against such security; or (vih) constitute a waiver of the right of Lender to enforce the liability and obligation of Borrower (but not against any members of Borrower (other than Guarantor to the extent provided in the Non-Recourse Guaranty) or their direct or indirect constituent members or partners or any other Person)Borrower, by money judgment or otherwise, to the extent of any loss, damage, cost, expense, liability, claim or other obligation (but excluding any punitive, consequential or speculative damages) actual Losses incurred by Lender (including out-of-pocket attorneys’ fees and costs reasonably incurred) arising out of or in connection with the following:
(ai) fraud or intentional material misrepresentation by Borrower, Guarantor or any Borrower or Guarantor Party in connection with the Loan;
(bii) intentional physical waste the willful misconduct of the Property (includingBorrower, but not limited to, waste due to gross negligence) by Borrower Guarantor or any affiliate thereof; provided, however, such physical waste shall exclude wear and tear to Borrower Party in connection with the Property that occurs in the ordinary course of business of the Property by Borrower or any affiliate thereofLoan;
(ciii) the material breach of any representation, warranty, covenant or indemnification provision in the Environmental Indemnity or in this Agreement any other Loan Document concerning Environmental Lawsenvironmental laws, Hazardous Substances hazardous substances and Asbestosasbestos and any indemnification of Lender with respect thereto in any such document;
(div) material physical waste to any Property caused by intentional acts or intentional omissions of Borrower, Guarantor or any Borrower Party, other than waste (or alleged waste) to such Property resulting from (A) the removal insufficiency of cash flow from the Collective Properties as a whole to prevent such waste and such insufficiency is not a result of misappropriation of Rents by any Borrower Party or disposal by Borrower or any affiliate thereof of any portion of the Property after an Event of Default has occurred and while it is continuing, unless such portion of the Property is replaced by an item of equal or greater value as determined (B) Lender’s failure to make cash flow received by Lender available to Borrower in its reasonable discretionorder to prevent such waste;
(ev) Borrower fails to obtain Lender’s prior written consent to any subordinate financing or voluntary Lien encumbering a Property or to the incurrence of unsecured indebtedness or indemnification obligations by Borrower and, in each case, not otherwise expressly permitted by the Loan Documents;
(vi) the misapplication misappropriation or conversion by Borrower Borrower, or any affiliate thereof Borrower Parties of (iA) any insurance proceeds paid by reason of any loss, damage or destruction to the Property, (iiB) any awards Awards or other amounts received in connection with the condemnation Condemnation of all or a portion of the a Property, (iiiC) any Rents following an Event of Default Rents, or (ivD) any Rents paid more than one (1) month in advanceamounts disbursed from Reserve Funds;
(f) failure to pay charges for labor or materials or taxes or other charges that can create liens superior to the lien of the Mortgage on any portion of the Property unless such taxes or other charges are being contested in accordance herewith or such taxes or charges have been delivered to Lender in accordance with Section 3.3 hereof or Borrower has complied with Section 5.2 hereof; and
(gvii) any security deposits, advance deposits or any other deposits collected by Borrower or any affiliate thereof with respect to the Property which are not delivered to Lender upon a foreclosure of the Property or action in lieu thereof, except to the extent any such security deposits, advance deposits or other deposits were applied in accordance with the terms and conditions of any of the Leases prior Leases;
(viii) the breach of any representation, warranty or covenant of Borrower with respect to itself, or any SPE Party, and such breach is cited as a material factor in the substantive consolidation of Borrower with any other Person (other than a co-borrower) in connection with any federal or state bankruptcy proceeding;
(ix) any litigation or other legal proceeding related to the occurrence Debt filed by Borrower, Guarantor, any Borrower Party or any Affiliate thereof in bad faith with the sole intention (as finally determined by a court of competent jurisdiction pursuant to a non-appealable order) of delaying, opposing, impeding, obstructing, hindering, enjoining or otherwise interfering with the efforts of Lender to exercise any rights and remedies available to Lender as provided herein and in the other Loan Documents upon an Event of Default;
(x) Borrower effects a Transfer in violation of the Event provisions of Default that gave rise to such foreclosure Section 4.2.1 or action Article VIII hereof; and/or
(xi) the breach of any representation, warranty or covenant set forth in lieu thereofSection 3.1.44. Notwithstanding anything to the contrary in this Agreement, the Note or any of the Loan Documents Documents, (iA) Lender shall not be deemed to have waived any right which Lender may have under Section 506(a), 506(b), 1111(b) or any other provisions of the U.S. Bankruptcy Code to file a claim for the full amount of the Debt or to require that all collateral shall continue to secure all of the Debt owing to Lender in accordance with the Loan Documents, and (iiB) the Debt shall become be fully recourse to Borrower (but not its members (other than Guarantor solely to the extent provided in the Non-Recourse Guaranty) or other direct or indirect constituent members or partners or any other Person) in the event that: (A1) the first full Monthly Debt Service Payment Amount intentionally omitted; (as defined 2) Borrower or any SPE Party or any Affiliate of any of them files, or joins in the Note) filing of, a voluntary petition against Borrower under the Note is not paid when dueBankruptcy code or any other Federal or state bankruptcy or insolvency law; (B3) other than in connection with a default under subsection (x) of the definition of Special Purpose Bankruptcy Remote Entity set forth in Schedule 5 heretoany Borrower Party or any Affiliate, Borrower fails to maintain its status as a Special Purpose Bankruptcy Remote Entity in accordance with the provisions of this Agreement and such failure results officer, director, or representative thereof files, or joins in the substantive consolidation of filing of, an involuntary petition against Borrower with another or any SPE Party under the Bankruptcy Code or any other Federal or state bankruptcy or insolvency law, or solicits or causes to be solicited, or otherwise colludes with, petitioning creditors for any involuntary petition against Borrower or any SPE Party from any Person; (C4) except as otherwise permitted pursuant to the Loan Documents, Borrower or any SPE Party fails to obtain Lender’s prior written consent to any subordinate financing or other voluntary lien encumbering the Property; (D) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any assignment, transfer, or conveyance of the Property or any interest therein as and to the extent required by this Agreement or the Mortgage; or (E) (1) if any petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law, shall be filed by Borrower or Guarantor, or (2) if Borrower or Guarantor files an answer consenting to, or otherwise joining in, oppose any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law filed against it it, by any other PersonPerson under the Bankruptcy Code or any other Federal or state bankruptcy or insolvency law unless there is no good faith defense to such involuntary petition; (5) any Borrower Party or any Affiliate, officer, director, or is found pursuant representative thereof consents to a final, unappealable order or acquiesces in writing or joins in an application for the appointment of a court of competent jurisdiction to have solicited or caused to be solicited creditors to file any involuntary petition for bankruptcycustodian, reorganization or arrangement pursuant to federal bankruptcy lawreceiver, trustee, or any similar federal or state law against examiner for Borrower or Guarantor, any SPE Party or any portion of the Collective Properties (3other than at the request of Lender); and/or (6) if Borrower or Guarantor are foundany SPE Party makes an assignment for the benefit of creditors or admits, pursuant in writing in any legal proceeding, its insolvency or its inability to pay its debts as they become due (unless failure to make such admission would be a final unappealable order violation of a court of competent jurisdiction, to have been in collusion with creditors that initiate a bankruptcy action or proceeding against Borrower or Guarantor or (F) an Event of Default described in Section 8.1(s) hereof shall have occurredlaw).
Appears in 1 contract
Samples: Loan Agreement (Industrial Logistics Properties Trust)
Exculpation. Subject to the qualifications below, Lender ----------- neither Agent on behalf of the Lenders nor the Lenders directly shall not enforce the liability and obligation of Borrower or its constituent members, partners, shareholders, directors, employees or agents or the direct or indirect constituent members, partners, shareholders, directors, employees or agents thereof (collectively, the “Borrower Parties”) or any other Person, to perform and observe the obligations contained in the Note, this Agreement, the Note Credit Agreement or any of the other Loan Documents by any action or proceeding wherein a money judgment shall be sought against Borrower (or any member, shareholder, partner or other owner of Borrower, or any separate account contract holder, beneficial owner, advisor, consultant, manager, fiduciary, director, officer or employee of any of the Borrower Parties or any other Personforegoing), except that Lender may bring a foreclosure action, an action for specific performance or any other appropriate action or proceeding to enable Lender to enforce and realize upon the Property, the Rents or any other collateral given to Lender pursuant to this Agreement and the other Loan Documents; provided, however, thatunless, except as specifically provided hereinexpressly reserved in clause (e) below, any the judgment in any such action or proceeding shall be enforceable against the Borrower Parties only to the extent of their Borrower's interest in the Property, the Rents and in any other collateral given to LenderAgent on behalf of the Lenders, and LenderAgent on behalf of the Lenders, by accepting the Note, this Agreement, the Note Credit Agreement and the other Loan Documents, agrees that it shall not sxx xxx for, seek or demand any deficiency judgment against any of the Borrower Parties or any other Person in any such action or proceeding under or by reason of or under or in connection with the Note, this Agreement, the Note Credit Agreement or any of the other Loan DocumentsDocuments except for any deficiency judgment that shall be enforced solely against or collected solely from the collateral given to Agent on behalf of the Lenders. The provisions of this paragraph Section shall not, however, (ia) constitute a waiver, release or impairment of any obligation evidenced or secured by this Agreement, the Note or any of the other Loan Documents; (iib) impair the right of Lender Agent on behalf of the Lenders to name any of the Borrower Parties, as a party defendant in any action or suit for foreclosure and sale under the MortgagePledge; (iiic) affect the validity or enforceability of or any guaranty or indemnity made in connection with the Loan or any of the rights and remedies of Lender Agent on behalf of the Lenders thereunder; (ivd) impair the right of Lender Agent on behalf of the Lenders to obtain the appointment of a receiver; (v) impair the enforcement of the Assignment of Leases and Rents; or (vie) constitute a waiver of the right of Lender Agent or any of the Lenders to enforce the liability and obligation of Borrower (but not against any members of Borrower (other than Guarantor to the extent provided in the Non-Recourse Guaranty) or their direct or indirect constituent members or partners or any other Person)Borrower, by money judgment or otherwise, to the extent of any loss, damage, cost, expense, liability, claim or other obligation (but excluding any punitive, consequential or speculative damages) incurred by Lender Agent or any of the Lenders (including attorneys’ ' fees and costs reasonably incurred) arising out of or in connection with (but only to the extent of) the following:
(ai) fraud waste committed by or intentional on behalf of Borrower with respect to the Mortgaged Property or the Pledged Collateral;
(ii) fraud, misrepresentation or willful misconduct by Borrower or Guarantor in connection with the Loan;
(b) intentional physical waste of the Property (including, but not limited to, waste due to gross negligence) by Borrower or any affiliate thereof; provided, however, such physical waste shall exclude wear and tear to the Property that occurs in the ordinary course of business of the Property by Borrower or any affiliate thereof;
(c) the material breach of any representation, warranty, covenant or indemnification provision in the Environmental Indemnity or in this Agreement concerning Environmental Laws, Hazardous Substances and Asbestos;
(diii) the removal or disposal by Borrower or any affiliate thereof of any portion of the Mortgaged Property after an Event of Default has occurred and while it is continuing, unless such portion of the Property is replaced by an item of equal or greater value as determined by Lender in its reasonable discretion;
(e) the misapplication or conversion by Borrower or any affiliate thereof of (i) any insurance proceeds paid by reason of any loss, damage or destruction to the Property, (ii) any awards or other amounts received in connection with the condemnation of all or a portion of the Property, (iii) any Rents following an Event of Default or (iv) any Rents paid more than one (1) month in advance;
(f) failure to pay charges for labor or materials or taxes or other charges that can create liens superior to the lien of the Mortgage on any portion of the Property unless such taxes or other charges are being contested in accordance herewith or such taxes or charges have been delivered to Lender in accordance with Section 3.3 hereof or Borrower has complied with Section 5.2 hereofDefault; and
(g) any security deposits collected by Borrower or any affiliate thereof with respect to the Property which are not delivered to Lender upon a foreclosure of the Property or action in lieu thereof, except to the extent any such security deposits were applied in accordance with the terms and conditions of any of the Leases prior to the occurrence of the Event of Default that gave rise to such foreclosure or action in lieu thereof. Notwithstanding anything to the contrary in any of the Loan Documents (i) Lender shall not be deemed to have waived any right which Lender may have under Section 506(a), 506(b), 1111(b) or any other provisions of the U.S. Bankruptcy Code to file a claim for the full amount of the Debt or to require that all collateral shall continue to secure all of the Debt owing to Lender in accordance with the Loan Documents, and (ii) the Debt shall become fully recourse to Borrower (but not its members (other than Guarantor solely to the extent provided in the Non-Recourse Guaranty) or other direct or indirect constituent members or partners or any other Person) in the event that: (A) the first full Monthly Debt Service Payment Amount (as defined in the Note) under the Note is not paid when due; (B) other than in connection with a default under subsection (x) of the definition of Special Purpose Bankruptcy Remote Entity set forth in Schedule 5 hereto, Borrower fails to maintain its status as a Special Purpose Bankruptcy Remote Entity in accordance with the provisions of this Agreement and such failure results in the substantive consolidation of Borrower with another Person; (C) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any subordinate financing or other voluntary lien encumbering the Property; (D) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any assignment, transfer, or conveyance of the Property or any interest therein as and to the extent required by this Agreement or the Mortgage; or (E) (1) if any petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law, shall be filed by Borrower or Guarantor, or (2) if Borrower or Guarantor files an answer consenting to, or otherwise joining in, any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law filed against it by any other Person, or is found pursuant to a final, unappealable order of a court of competent jurisdiction to have solicited or caused to be solicited creditors to file any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law against Borrower or Guarantor, or (3) if Borrower or Guarantor are found, pursuant to a final unappealable order of a court of competent jurisdiction, to have been in collusion with creditors that initiate a bankruptcy action or proceeding against Borrower or Guarantor or (F) an Event of Default described in Section 8.1(s) hereof shall have occurred.
Appears in 1 contract
Samples: Credit Agreement (Desert Springs Marriott Limited Partnership)
Exculpation. Subject Except as otherwise set forth in this Section 8.14 and Section 4.2 to the qualifications belowcontrary, Lender shall not enforce the liability and obligation of Borrower or its constituent members, partners, shareholders, directors, employees or agents or the direct or indirect constituent members, partners, shareholders, directors, employees or agents thereof (collectively, the “Borrower Parties”) or any other Person, Operating Lessee to perform and observe the obligations contained in this Agreement, the Note Note, the Mortgage or any of the other Loan Documents executed and delivered by any action Borrower or proceeding wherein a money judgment shall be sought against any of the Borrower Parties or any other Person, Operating Lessee except that Lender may pursue any power of sale, bring a foreclosure action, an action for specific performance performance, action for money judgment, or any other appropriate action or proceeding (including, without limitation, to enable obtain a deficiency judgment) against Borrower, Operating Lessee or any other Person solely for the purpose of enabling Lender to enforce and realize upon (a) any Collateral, and (b) any Rents to the Propertyextent (x) received by Borrower or Manager (or any of their affiliates), after the occurrence of an Event of Default or (y) distributed to Borrower, Operating Lessee or Manager, or their respective shareholders, or partners or members, as applicable, or affiliates during or with respect to any period for which Lender did not receive the full amounts it was entitled to receive as prepayments of the Loan pursuant to Section 2.6(b) (all Rents or covered by clauses (x) and (y) being hereinafter referred to as the “Recourse Distributions”) and (c)) any other collateral given to Lender pursuant to this Agreement under the Loan Documents ((a), (b), and (c) collectively, the other Loan Documents“Default Collateral”); provided, however, that, except as specifically provided herein, that any judgment in any such action or proceeding shall be enforceable against the Borrower Parties only to the extent of their interest in any Default Collateral. The provisions of this Section 8.14 shall not, however, (a) impair the Property, validity of the Rents and Indebtedness evidenced by the Loan Documents or in any other collateral given to Lender, and Lender, by accepting this Agreement, way affect or impair the Note and the other Loan Documents, agrees that it shall not sxx for, seek or demand any deficiency judgment against any Liens of the Borrower Parties or any other Person in any such action or proceeding under or by reason of or in connection with this Agreement, the Note Mortgage or any of the other Loan Documents. The provisions Documents or the right of this paragraph shall not, however, (i) constitute a waiver, release or impairment Lender to foreclose the Mortgage following an Event of any obligation evidenced or secured by this Agreement, the Note or any of the other Loan DocumentsDefault; (iib) impair the right of Lender to name any of the Borrower Parties, Person as a party defendant in any action or suit for judicial foreclosure and sale under the Mortgage; (iiic) affect the validity or enforceability of any guaranty made in connection with the Note, the Mortgage or the other Loan or any rights and remedies of Lender thereunderDocuments; (ivd) impair the right of Lender to obtain the appointment of a receiver; (ve) impair the enforcement of the Assignment of Leases and Rents; or (vi) constitute a waiver of the right of Lender to enforce the liability bring suit for and obligation of Borrower (but not recover against any members Person any damages, losses, expenses, liabilities or costs resulting from fraud, willful misrepresentation, waste of Borrower (other than Guarantor to the extent provided in the Non-Recourse Guaranty) or their direct or indirect constituent members or partners all or any other Person), by money judgment or otherwise, to the extent of any loss, damage, cost, expense, liability, claim or other obligation (but excluding any punitive, consequential or speculative damages) incurred by Lender (including attorneys’ fees and costs reasonably incurred) arising out of or in connection with the following:
(a) fraud or intentional misrepresentation by Borrower or Guarantor in connection with the Loan;
(b) intentional physical waste portion of the Property (includingProperty, but not limited to, waste due to gross negligence) by Borrower or any affiliate thereof; provided, however, such physical waste shall exclude wear and tear to the Property that occurs in the ordinary course of business of the Property by Borrower or any affiliate thereof;
(c) the material breach of any representation, warranty, covenant or indemnification provision in the Environmental Indemnity or in this Agreement concerning Environmental Laws, Hazardous Substances and Asbestos;
(d) the wrongful removal or disposal by Borrower of all or any affiliate thereof of any portion of the Property after an Event of Default has occurred and while it is continuing, unless such portion of the Property is replaced by an item of equal or greater value as determined by Lender in its reasonable discretion;
(e) the misapplication or conversion by Borrower or any affiliate thereof of (i) any insurance proceeds paid by reason of any loss, damage or destruction to the Property, (ii) any awards or other amounts received Person in connection with this Agreement, the condemnation Note, the Mortgage or the other Loan Documents; (f) impair the right of all Lender to obtain the Recourse Distributions received by any Person; (g) impair the right of Lender to bring suit for and recover against any Person with respect to any misappropriation of security deposits or a portion of the Property, (iii) any Rents following an Event of Default or (iv) any Rents paid collected more than one (1) month in advance;
; (fh) failure impair the right of Lender to pay charges for labor obtain Insurance Proceeds or materials Condemnation Proceeds due to Lender pursuant to the Mortgage; (i) impair the right of Lender to enforce the provisions of Sections 4.1(V) or taxes 5.1(D) through 5.1(G), inclusive of this Agreement, Section 2.8 of each Mortgage or the Environmental Indemnity even after repayment in full by Borrower of the Indebtedness; (j) prevent or in any way hinder Lender from exercising, or constitute a defense, or counterclaim, or other charges that can create liens superior to the lien basis for relief in respect of the Mortgage exercise of, any other remedy against any or all of the Collateral securing the Note as provided in the Loan Documents; (k) impair the right of Lender to bring suit for and recover against any person with respect to any misapplication of any funds (including, without limitation, insurance proceeds and condemnation proceeds); (l) impair the right of Lender to sxx for, seek or demand a deficiency judgment against any Person solely for the purpose of foreclosing on any portion Collateral or any part thereof, or realizing upon the Default Collateral, or (m) impair the right of Lender to bring suit for and recover against any Person any damages, losses, expenses, liabilities or costs in the Property unless such taxes or other charges are being contested in accordance herewith or such taxes or charges have been delivered to Lender in accordance with Section 3.3 hereof or Borrower has complied with Section 5.2 hereof; and
(g) any security deposits collected by event that Borrower or any affiliate Operating Lessee shall take any action of any kind or nature whatsoever, either directly or indirectly to oppose, impede, obstruct, challenge, hinder, frustrate, enjoin or otherwise interfere with (A) Lender’s termination of the Operating Lease with the Operating Lessee, (B) Lender or the party acquiring the Property following the occurrence of a foreclosure or deed in lieu thereof with respect (in full substitution of the Operating Lessee) being deemed the “Owner” under the Management Agreement, (C) the execution, delivery or effectiveness of a new Management Agreement directly between Lender or the party acquiring the Property following a foreclosure or deed in lieu thereof and applicable Manager or (D) any payment or other transfer by Manager of funds which would otherwise be paid to the Property which are not delivered Operating Lessee under the Operating Lease directly to Lender upon or the party acquiring the Property following the occurrence of a foreclosure of the Property or action deed in lieu thereof, except in each case after or as a result of any automatic termination of the Operating Lease or of Lender exercising its right to terminate the Operating Lease, in each case pursuant to the Subordination, Attornment and Security Agreement and this Agreement, or shall, either directly or indirectly, cause or permit any other person to take any action which, if taken by such Operating Lessee would constitute an event described in this Section 8.14(m); provided, however, that any deficiency judgment referred to in this Section 8.14(m) shall be enforceable only to the extent any such security deposits were applied in accordance with the terms and conditions of any of the Leases prior Default Collateral. The preceding provisions of this Section 8.14 shall be inapplicable to the occurrence of the Event of Default that gave rise to such foreclosure or action in lieu thereof. Notwithstanding anything to the contrary in any of the Loan Documents Person if (i) Lender shall not be deemed to have waived any right which Lender may have under Section 506(a), 506(b), 1111(b) or any other provisions of the U.S. Bankruptcy Code to file a claim for the full amount of the Debt or to require that all collateral shall continue to secure all of the Debt owing to Lender in accordance with the Loan Documents, and (ii) the Debt shall become fully recourse to Borrower (but not its members (other than Guarantor solely to the extent provided in the Non-Recourse Guaranty) or other direct or indirect constituent members or partners or any other Person) in the event that: (A) the first full Monthly Debt Service Payment Amount (as defined in the Note) under the Note is not paid when due; (B) other than in connection with a default under subsection (x) of the definition of Special Purpose Bankruptcy Remote Entity set forth in Schedule 5 hereto, Borrower fails to maintain its status as a Special Purpose Bankruptcy Remote Entity in accordance with the provisions of this Agreement and such failure results in the substantive consolidation of Borrower with another Person; (C) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any subordinate financing or other voluntary lien encumbering the Property; (D) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any assignment, transfer, or conveyance of the Property or any interest therein as and to the extent required by this Agreement or the Mortgage; or (E) (1) if any petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law, shall be filed by Borrower or Guarantor, or (2) if Borrower or Guarantor files an answer consenting to, or otherwise joining in, any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law filed against it by any other Person, or is found pursuant to a final, unappealable order of a court of competent jurisdiction to have solicited or caused to be solicited creditors to file any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law against Borrower or GuarantorOperating Lessee shall be filed by Borrower, Operating Lessee, or any Affiliate of Borrower or Operating Lessee, (3ii) if an involuntary bankruptcy or other insolvency proceeding is commenced against Borrower or Operating Lessee (by a party other than Lender) but only if Borrower has consented or acquiesced to such proceeding or if Borrower, Operating Lessee or any Affiliate of Borrower or Operating Lessee has acted in concert with, colluded or conspired with the party to cause the filing thereof or has consented to or acquiesced thereto, (iii) if Borrower or Guarantor are foundOperating Lessee shall institute any proceeding for the dissolution or liquidation of Borrower or Operating Lessee, pursuant to (iv) if Borrower or Operating Lessee shall make an assignment for the benefit of creditors, (v) if Borrower or Operating Lessee shall breach any representation, warranty or covenant in Section 4.1(C) (such that such breach was considered by a final unappealable order court as a factor in the court’s finding for a consolidation of the assets of a court Borrower or Operating Lessee with the assets of competent jurisdictionanother person or entity or as a result thereof Lender suffers any material damage, to have been cost, liability or expense; provided, however, that in collusion with creditors that initiate a bankruptcy action or proceeding the absence of an actual consolidation, recourse may be had against Borrower or Guarantor Operating Lessee only to the extent of losses for such breach), 4.1(V), 4.1(AA), 5.1(T) (such that such breach was considered by a court as a factor in the court’s finding for a consolidation of the assets of a Borrower or Operating Lessee with the assets of another person or entity or as a result thereof Lender suffers any material damage, cost, liability or expense; provided, however, that in the absence of an actual consolidation, recourse may be had against Borrower or Operating Lessee only to the extent of losses for such breach) or 5.1(X), (v) if Borrower or Operating Lessee allows any Transfer to occur in violation of Section 6.1(B) hereof or otherwise fails to obtain Lender’s prior written consent to any Transfer to the extent any consent is required in the Loan Documents, (vi) Borrower or Operating Lessee interferes with Lender’s exercise of any of its rights or remedies hereunder or (Fvii) an Event of Default described if Borrower or Operating Lessee breaches any representation or warranty contained in Section 8.1(s) hereof shall have occurred4.1(S).
Appears in 1 contract
Exculpation. Subject The General Partner agrees to indemnify the Escrow Agent for, and to hold it harmless against, any loss, liability, or expense incurred without gross negligence or willful misconduct on the part of the Escrow Agent, arising out of this Escrow Agreement, as well as the costs and expenses of defending any claim or liability or of prosecuting any action in the premises. The Escrow Agent shall not be obligated to take any action hereunder which might in its reasonable judgment subject it to any expense or liability unless it shall have been furnished with indemnity acceptable to it. Prior to the qualifications belowTermination Date, Lender Subscription Payments held by the Escrow Agent shall remain the property of the Subscribers making such Payments and shall not enforce be subject to a lien of the liability and obligation of Borrower or its constituent members, partners, shareholders, directors, employees or agents or the direct or indirect constituent members, partners, shareholders, directors, employees or agents thereof (collectively, the “Borrower Parties”) Escrow Agent or any other Person, to perform and observe the obligations contained in this Agreement, the Note or any creditors of the other Loan Documents by Fund or the General Partner. The Escrow Agent shall not be obligated to take any action or proceeding wherein a money judgment shall be sought against any of the Borrower Parties or any other Person, except that Lender may bring a foreclosure action, an action for specific performance or any other appropriate action or proceeding which it is not expressly directed to enable Lender to enforce and realize upon the Property, the Rents or any other collateral given to Lender pursuant to this Agreement and the other Loan Documents; provided, however, that, except as specifically provided herein, any judgment in any such action or proceeding shall be enforceable against the Borrower Parties only to the extent of their interest in the Property, the Rents and in any other collateral given to Lender, and Lender, by accepting this Agreement, the Note and the other Loan Documents, agrees that it shall not sxx for, seek or demand any deficiency judgment against any of the Borrower Parties or any other Person in any such action or proceeding under or by reason of or in connection with this Agreement, the Note or any of the other Loan Documents. The provisions of this paragraph shall not, however, (i) constitute a waiver, release or impairment of any obligation evidenced or secured by this Agreement, the Note or any of the other Loan Documents; (ii) impair the right of Lender to name any of the Borrower Parties, as a party defendant in any action or suit for foreclosure and sale under the Mortgage; (iii) affect the validity or enforceability of any guaranty made in connection with the Loan or any rights and remedies of Lender thereunder; (iv) impair the right of Lender to obtain the appointment of a receiver; (v) impair the enforcement of the Assignment of Leases and Rents; or (vi) constitute a waiver of the right of Lender to enforce the liability and obligation of Borrower (but not against any members of Borrower (other than Guarantor to the extent provided in the Non-Recourse Guaranty) or their direct or indirect constituent members or partners or any other Person), by money judgment or otherwise, to the extent of any loss, damage, cost, expense, liability, claim or other obligation (but excluding any punitive, consequential or speculative damages) incurred by Lender (including attorneys’ fees and costs reasonably incurred) arising out of or in connection with the following:
(a) fraud or intentional misrepresentation by Borrower or Guarantor in connection with the Loan;
(b) intentional physical waste of the Property (including, but not limited to, waste due to gross negligence) by Borrower or any affiliate thereof; provided, however, such physical waste shall exclude wear and tear to the Property that occurs in the ordinary course of business of the Property by Borrower or any affiliate thereof;
(c) the material breach of any representation, warranty, covenant or indemnification provision in the Environmental Indemnity or take in this Agreement concerning Environmental Laws, Hazardous Substances unless and Asbestos;
(d) until it shall have received written instruction from the removal Fund. The Escrow Agent shall be liable only for its own gross negligence or disposal by Borrower or any affiliate thereof of any portion of the Property after an Event of Default has occurred willful misconduct and while it is continuing, unless such portion of the Property is replaced by an item of equal or greater value as determined by Lender in its reasonable discretion;
(e) the misapplication or conversion by Borrower or any affiliate thereof of (i) any insurance proceeds paid by reason of any loss, damage or destruction to the Property, (ii) any awards or other amounts received in connection with the condemnation of all or a portion of the Property, (iii) any Rents following an Event of Default or (iv) any Rents paid more than one (1) month in advance;
(f) failure to pay charges shall incur no liability for labor or materials or taxes or other charges that can create liens superior to the lien of the Mortgage on any portion of the Property unless such taxes or other charges are being contested in accordance herewith or such taxes or charges have been delivered to Lender in accordance with Section 3.3 hereof or Borrower has complied with Section 5.2 hereof; and
(g) any security deposits collected by Borrower or any affiliate thereof with respect to the Property which are not delivered to Lender upon a foreclosure of the Property or action in lieu thereof, except to the extent any such security deposits were applied in accordance with the terms and conditions of this Escrow Agreement or with the terms of any of instructions received by it from the Leases prior General Partner, whether or not contrary to the occurrence of the Event of Default that gave rise to such foreclosure or action in lieu thereof. Notwithstanding anything to the contrary in any of the Loan Documents (i) Lender shall not be deemed to have waived any right which Lender may have under Section 506(a), 506(b), 1111(b) or any other provisions of the U.S. Bankruptcy Code to file a claim for the full amount of the Debt or to require that all collateral shall continue to secure all of the Debt owing to Lender in accordance with the Loan Documents, and (ii) the Debt shall become fully recourse to Borrower (but not its members (other than Guarantor solely to the extent provided in the Non-Recourse Guaranty) or other direct or indirect constituent members or partners or any other Person) in the event that: (A) the first full Monthly Debt Service Payment Amount (as defined in the Note) under the Note is not paid when due; (B) other than in connection with a default under subsection (x) of the definition of Special Purpose Bankruptcy Remote Entity set forth in Schedule 5 hereto, Borrower fails to maintain its status as a Special Purpose Bankruptcy Remote Entity in accordance with the provisions of this Agreement and such failure results in the substantive consolidation of Borrower with another Person; (C) except as otherwise permitted pursuant or to the Loan Documentsagreements between the Fund and the Subscribers. The Escrow Agent may rely upon, Borrower fails and shall be protected in acting upon, any resolution, certificate, opinion, notice, request, consent, or other paper or document believed by it to obtain Lender’s prior written consent be genuine and to have been signed by the proper person or persons. Any notice or instruction from the Fund shall be sufficient if it bears or purports to bear the signature of any one of the following: Xxxx X. Xxxxxxx and Xxxxxxx X. Xxxxxx, whose signatures appear hereon, with or without designation of principal or of representative capacity. The Escrow Agent may consult with counsel, and the opinion of such counsel shall be full and complete protection in respect to any subordinate financing action taken or other voluntary lien encumbering the Property; (D) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to suffered by it hereunder in accordance with such opinion. The Escrow Agent may petition any assignment, transfer, or conveyance of the Property or any interest therein as and to the extent required by this Agreement or the Mortgage; or (E) (1) if any petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law, shall be filed by Borrower or Guarantor, or (2) if Borrower or Guarantor files an answer consenting to, or otherwise joining in, any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law filed against it by any other Person, or is found pursuant to a final, unappealable order of a court of competent jurisdiction to have solicited resolve any disagreement relating hereto and may refuse to act until such court has ordered it to act. Such rights and remedies shall be alternative and any action taken or caused to not taken in conformance with an opinion of counsel or court order shall not constitute negligence or misconduct and shall be solicited creditors to file any involuntary petition for bankruptcycomplete and final acquittance and discharge of the Escrow Agent's responsibilities with respect thereto. Notwithstanding the foregoing, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law against Borrower or Guarantor, or (3) if Borrower or Guarantor are found, pursuant to a final unappealable order it is understood and agreed by the parties that no partner of a court of competent jurisdiction, to have been the General Partner acting in collusion with creditors that initiate a bankruptcy action or proceeding against Borrower or Guarantor or (F) an Event of Default described in Section 8.1(s) hereof its capacity as such shall have occurredany personal liability under this agreement and that any person asserting a claim against the General Partner hereunder shall look solely to the assets of such General Partner (specifically excluding the personal assets of the partners thereof).
Appears in 1 contract
Samples: Capital Contributions Escrow Agreement (Boston Capital Tax Credit Fund Iv Lp)
Exculpation. Subject to the qualifications below, Lender shall not enforce the liability and obligation of Borrower or its constituent members, partners, shareholders, directors, employees or agents or the direct or indirect constituent members, partners, shareholders, directors, employees or agents thereof (collectively, the “Borrower Parties”) or any other Person, to perform and observe the obligations Obligations contained in the Note, this Agreement, the Note Mortgage or any of the other Loan Documents by any action or proceeding wherein a money judgment shall be sought against Borrower or any principal, director, officer, employee, beneficiary, shareholder, partner, member, trustee, agent, or affiliate of Borrower (but specifically excluding Guarantor to the extent of Guarantor’s liability pursuant to the Guaranty) or any legal representatives, successors or assigns of any of the Borrower Parties or any other Personforegoing (collectively, the “Exculpated Parties”), except that Lender may bring a foreclosure action, an action for specific performance or any other appropriate action or proceeding to enable Lender to enforce and realize upon its interest under the Note, this Agreement, the Mortgage and the other Loan Documents, or in the Property, the Rents Gross Revenues or any other collateral given to Lender pursuant to this Agreement and the other Loan Documents; provided, however, that, except as specifically provided herein, any judgment in any such action or proceeding shall be enforceable against the Borrower Parties only to the extent of their Borrower’s interest in the Property, in the Rents Gross Revenues and in any other collateral given to Lender, and Lender, by accepting the Note, this Agreement, the Note Mortgage and the other Loan Documents, agrees that it shall not sxx xxx for, seek or demand any deficiency judgment against Borrower or any of the Borrower Parties or any other Person Exculpated Parties, in any such action or proceeding under or by reason of or under or in connection with the Note, this Agreement, the Note Mortgage or any of the other Loan Documents. The provisions of this paragraph Section 10.1 shall not, however, (ia) constitute a waiver, release or impairment of any obligation evidenced or secured by this Agreement, the Note or any of the other Loan Documents; (iib) impair the right of Lender to name any of the Borrower Parties, as a party defendant in any action or suit for foreclosure and sale under the Mortgage; (iiic) affect the validity or enforceability of any of the Loan Documents or any guaranty made in connection with the Loan or any of the rights and remedies of Lender thereunder; (ivd) impair the right of Lender to obtain the appointment of a receiver; (ve) constitute a prohibition against Lender to seek a deficiency judgment against Borrower in order to fully realize the security granted by the Mortgage or to commence any other appropriate action or proceeding in order for Lender to exercise its remedies against the Property; (f) impair the enforcement of the Assignment assignment of Leases leases and Rentsrents contained in the Mortgage and in any other Loan Documents; or (vig) constitute a waiver of the right of Lender to enforce the liability and obligation of Borrower (but not against any members of Borrower (other than Guarantor to the extent provided in the Non-Recourse Guaranty) or their direct or indirect constituent members or partners or any other Person)Borrower, by money judgment or otherwise, to the extent of any loss, damage, cost, expense, liability, claim or other obligation (but excluding any punitive, consequential or speculative damages) Losses incurred by Lender (including attorneys’ fees and costs reasonably incurred) arising out of or in connection with the following:following (all such liability and obligation of Borrower for any or all of the following being referred to herein as “Borrower’s Recourse Liabilities”):
(ai) fraud or intentional misrepresentation by Borrower or Guarantor any Borrower Party in connection with the Loan;
(bii) intentional the gross negligence or willful misconduct of Borrower or any Borrower Party in connection with the Loan;
(iii) any litigation or other legal proceeding related to the Debt filed by any Borrower Party that intentionally interferes with Lender exercising any rights and remedies available to Lender as provided herein and in the other Loan Documents only to the extent a court of competent jurisdiction, in a final non-appealable decision, finds the applicable defenses were not raised in good faith by such Borrower Party;
(iv) physical waste to the Property (or any portion thereof) caused by intentional acts or intentional omissions of Borrower, or any Borrower Party, or the removal or disposal of any portion of the Property (including, but not limited towithout limitation, waste due any personal Property) after an Event of Default (except to gross negligencethe extent (i) by Borrower the same was replaced with Property of the same utility and of the same or any affiliate thereofgreater value or (ii) such portion of the Property was obsolete and no longer required or beneficial for the operation of the Property, in which case no replacement shall be required); provided, however, such physical “waste” shall not include (a) any waste shall exclude wear and tear to at the Property that occurs in the ordinary course caused by a lack of business of sufficient cash flow at the Property or (b) Lender’s refusal to permit such cash flow to be applied (provided, however, the foregoing clause (b) shall not apply if Lender cannot release cash flow because such cash flow is being held by Borrower Lender and Lender’s access to such amounts is restricted or constrained in any manner by applicable Legal Requirements, injunction or other court order, or as a result of any action, inaction or omission by Borrower, Guarantor or any affiliate thereofother Borrower Party);
(cv) the material breach of any representation, warranty, covenant or indemnification provision in the Environmental Indemnity or in this Agreement concerning Environmental Laws, Hazardous Substances and Asbestos;
(d) the removal or disposal by Borrower or any affiliate thereof of any portion of the Property after an Event of Default has occurred and while it is continuing, unless such portion of the Property is replaced by an item of equal or greater value as determined by Lender in its reasonable discretion;
(e) the misapplication misappropriation or conversion by Borrower or any affiliate thereof Borrower Party of (iA) any insurance proceeds Insurance Proceeds paid by reason of any loss, damage or destruction to the Property, (iiB) any awards Awards or other amounts received in connection with the condemnation Condemnation of all or a portion of the Property, (iiiC) any Rents following an Event Gross Revenues (including Rents, Insurance Proceeds and security deposits, advance deposits or any other deposits), in each case, in violation of Default or (iv) any Rents paid more than one (1) month in advanceexpress conditions of the Loan Documents;
(f) failure to pay charges for labor or materials or taxes or other charges that can create liens superior to the lien of the Mortgage on any portion of the Property unless such taxes or other charges are being contested in accordance herewith or such taxes or charges have been delivered to Lender in accordance with Section 3.3 hereof or Borrower has complied with Section 5.2 hereof; and
(gvi) any security deposits, advance deposits or any other deposits collected by Borrower or any affiliate thereof with respect to the any Individual Property which are not delivered to Lender upon a foreclosure of the such Individual Property or action in lieu thereof, except to the extent any such security deposits were applied in accordance with the terms and conditions of any of the Leases prior to the occurrence of the Event of Default that gave rise to such foreclosure or action in lieu thereof;
(vii) the seizure or forfeiture of any Individual Property, or any portion thereof, or Borrower’s interest therein, resulting from criminal wrongdoing by Borrower or any Borrower Parties;
(viii) the breach of any representation, warranty, covenant or indemnification provision in the Mortgage or in any other Loan Document concerning environmental laws, hazardous substances and/or asbestos and any indemnification of Lender with respect thereto in either document;
(ix) Borrower fails to obtain Lender’s prior consent to any subordinate financing secured by the Property (other than Permitted Indebtedness) or other voluntary Lien encumbering the Property (it being acknowledged that the foregoing shall not apply to Liens arising from Taxes, labor, materials or other charges that result in Liens on any portion of any of the Properties); and/or
(x) if the Ground Lease is terminated, failure to pay Taxes and/or charges for labor or materials, or other charges that can create Liens on any portion of the Property (other than Permitted Encumbrances or any Lien being contested in good faith in accordance with the terms hereof); provided, however, Borrower shall not be liable to the extent (A) cash flow from the Property is insufficient to pay such Taxes or charges for labor or materials or other charges that can create Liens on any portion of the Property or (B) sums sufficient to pay such Taxes have been deposited with Lender in accordance with the terms of this Agreement and Lender’s access to such sums is not restricted or constrained in any manner by applicable Legal Requirements, injunction or other court order, or as a result of any action, inaction or omission by Borrower, Guarantor or any other Borrower Party. Notwithstanding anything to the contrary in this Agreement or any of the other Loan Documents Documents, (iA) Lender shall not be deemed to have waived any right which Lender may have under Section 506(a), 506(b), 1111(b) or any other provisions of the U.S. Bankruptcy Code to file a claim for the full amount of the Debt Obligations or to require that all collateral shall continue to secure all of the Debt Obligations owing to Lender in accordance with the Loan Documents, and (iiB) the Debt Obligations shall become be fully recourse to Borrower (but not its members (other than Guarantor solely to the extent provided in the Non-event that any of the following occur (each, a “Springing Recourse GuarantyEvent”):
(i) or other direct or indirect constituent members or partners Borrower files a voluntary petition under the Bankruptcy Code or any other Person) in the event that: (A) the first full Monthly Debt Service Payment Amount (as defined in the Note) under the Note is not paid when due; (B) other than in connection with a default under subsection (x) of the definition of Special Purpose Bankruptcy Remote Entity set forth in Schedule 5 hereto, Borrower fails to maintain its status as a Special Purpose Bankruptcy Remote Entity in accordance with the provisions of this Agreement and such failure results in the substantive consolidation of Borrower with another Person; (C) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any subordinate financing or other voluntary lien encumbering the Property; (D) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any assignment, transfer, or conveyance of the Property or any interest therein as and to the extent required by this Agreement or the Mortgage; or (E) (1) if any petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal Federal or state bankruptcy or insolvency law, shall be filed by Borrower or Guarantor, or ;
(2ii) if Borrower or Guarantor expressly consents to a substantive consolidation with any other Person; unless such consolidation is discharged, stayed or dismissed within thirty (30) days following the occurrence of such consolidation;
(iii) the filing of an involuntary petition against Borrower under the Bankruptcy Code or any other Federal or state bankruptcy or insolvency law by any other Person in which Borrower colludes with or otherwise assists such Person, and/or Borrower solicits or causes to be solicited petitioning creditors for any involuntary petition against Borrower by any Person;
(iv) Borrower files an answer consenting to, or otherwise acquiescing in, or joining in, any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law filed against it by any other PersonPerson under the Bankruptcy Code or any other Federal or state bankruptcy or insolvency law;
(v) Borrower or any Affiliate, officer, director or representative which controls Borrower consents in writing to, or is found pursuant to a finalacquiesces in, unappealable order or joins in, an application for the appointment of a court of competent jurisdiction to have solicited custodian, receiver, trustee or caused to be solicited creditors to file any involuntary petition examiner for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, Borrower or any similar portion of the Property;
(vi) Borrower makes an assignment for the benefit of creditors or admits, in writing or in any legal proceeding, its insolvency or inability to pay its debts as they become due;
(vii) Borrower fails to obtain Lender’s prior consent to any Transfer of the Property or any interest therein or any Transfer of any direct or indirect interest in Borrower, in either case as required by the Mortgage or this Agreement other than a Permitted Transfer; provided, however, that there shall be no liability under this clause (vii) for a Transfer that would be a Permitted Transfer but for Borrower’s failure to provide (A) notice or copies of the documentation related to such Transfer to Lender or (B) Lender the opportunity to review any documentation in connection with such Transfer; or
(viii) Borrower fails to comply with any provision of Section 4.4 hereof and such failure causes a substantive consolidation of Borrower with any other Person in connection with any federal or state law against Borrower or Guarantor, or (3) if bankruptcy proceeding unless such consolidation was involuntary and not consented to by Borrower or Guarantor are foundand is discharged, pursuant to a final unappealable order stayed or dismissed within thirty (30) days following the occurrence of a court of competent jurisdiction, to have been in collusion with creditors that initiate a bankruptcy action or proceeding against Borrower or Guarantor or (F) an Event of Default described in Section 8.1(s) hereof shall have occurredsuch consolidation.
Appears in 1 contract
Exculpation. (a) Subject to the qualifications below, Lender shall not enforce the liability and obligation of Borrower or its constituent members, partners, shareholders, directors, employees or agents or the direct or indirect constituent members, partners, shareholders, directors, employees or agents thereof (collectively, the “Borrower Parties”) or any other Person, Borrowers to perform and observe the obligations contained in the Note, this Agreement, the Note Security Instruments or any of the other Loan Documents by any action or proceeding wherein a money judgment or any deficiency judgment or other judgment establishing personal liability shall be sought against Borrowers or any principal, director, officer, employee, beneficiary, shareholder, partner, member, trustee, agent, or Affiliate of Borrowers (but specifically excluding Guarantor) or any legal representatives, successors or assigns of any of the Borrower Parties or any other Personforegoing (collectively, the “Exculpated Parties”), except that Lender may bring a foreclosure action, an action for specific performance or any other appropriate action or proceeding to enable Lender to enforce and realize upon its interest under the PropertyNote, this Agreement, the Rents Security Instruments and the other Loan Documents, or in the Properties, the Rents, or any other collateral given to Lender pursuant to this Agreement and the other Loan Documents; provided, however, that, except as specifically provided herein, any judgment in any such action or proceeding shall be enforceable against the Borrower Parties Borrowers only to the extent of their Borrowers’ interest in the PropertyProperties, in the Rents and in any other collateral given to Lender, and Lender, by accepting the Note, this Agreement, the Note Security Instruments and the other Loan Documents, agrees that it shall not sxx xxx for, seek or demand any deficiency judgment against Borrowers or any of the Borrower Exculpated Parties or any other Person in any such action or proceeding under or by reason of or under or in connection with the Note, this Agreement, the Note Security Instruments or any of the other Loan Documents. The provisions of this paragraph Section shall not, however, (i1) constitute a waiver, release or impairment of any obligation evidenced or secured by this Agreement, the Note or any of the other Loan Documents; (ii2) impair the right of Lender to name any of the Borrower Parties, Borrowers as a party defendant in any action or suit for foreclosure and sale under the MortgageSecurity Instruments; (iii3) affect the validity or enforceability of any indemnity, guaranty or similar instrument (including, without limitation, the indemnities set forth in Article 12 hereof, Section 11.2 hereof, in the Guaranty and in the Environmental Indemnity) made in connection with the Loan or any of the rights and remedies of Lender thereunderthereunder (including, without limitation, Lender’s right to enforce said rights and remedies against Borrowers and/or Guarantor (as applicable) personally and without the effect of the exculpatory provisions of this Article 13); (iv4) impair the right of Lender to obtain the appointment of a receiver; (v5) impair the enforcement of the Assignment assignment of Leases leases and Rentsrents contained in the Security Instruments; (6) impair the right of Lender to enforce Section 4.12(e) of this Agreement; (7) constitute a prohibition against Lender to seek a deficiency judgment against Borrowers in order to fully realize the security granted by the Security Instruments or to commence any other appropriate action or proceeding in order for Lender to exercise its remedies against the Properties; or (vi) 8) constitute a waiver of the right of Lender to enforce the liability and obligation of Borrower (but not against any members of Borrower (other than Guarantor to the extent provided in the Non-Recourse Guaranty) or their direct or indirect constituent members or partners or any other Person)Borrowers, by money judgment or otherwise, to the extent of any loss, damage, cost, expense, liability, claim or other obligation (but excluding any punitive, consequential or speculative damages) Losses incurred by Lender (including attorneys’ fees and costs reasonably incurred) arising out of or in connection with any of the following:
(ai) fraud or intentional misrepresentation or any failure to disclose a material fact by any Borrower, any SPE Component Entity, Guarantor, or any Borrower or Guarantor Party in connection with the Loan;
(bii) intentional the gross negligence or willful misconduct of any Borrower, any SPE Component Entity, Guarantor, or any Borrower Party or the commission of a criminal act by any Borrower, any SPE Component Entity, Guarantor, or any Borrower Party which results in any seizure or forfeiture of any Property or any portion thereof or any Borrower’s interest therein;
(iii) material physical waste to any Property caused by the intentional acts or intentional omissions of the Property any Borrower, any SPE Component Entity, Guarantor, or any Borrower Party (including, but not limited towithout limitation, waste due to gross negligenceany arson or abandonment of any Property) and/or the removal or disposal of any portion of any Property after an Event of Default by Borrower any Borrower, any SPE Component Entity, Guarantor, or any affiliate thereof; provided, however, such physical waste shall exclude wear and tear to the Property that occurs in the ordinary course of business of the Property by Borrower or any affiliate thereofParty;
(civ) the material misapplication, misappropriation or conversion by any Borrower of (A) any insurance proceeds paid to any Borrower Party by reason of any loss, damage or destruction to any Property, (B) any Awards or other amounts received by any Borrower Party in connection with the Condemnation of all or a portion of any Property, (C) any Rents following an Event of Default or (D) any Tenant security deposits or Rents collected in advance;
(v) failure to pay any Taxes or Other Charges, charges for labor or materials or any other charges that can create liens on any portion of any Property to the extent that the revenue from the Properties is sufficient to pay such amounts (provided that Borrower shall have no liability for (x) amounts deposited with Lender as Tax Reserve Funds for Taxes or Other Charges where Lender elects not to apply such funds toward payment of such Taxes or Other Charges owed or (y) Taxes or Other Charges owed that are contested strictly in accordance with the terms of the Loan Documents);
(vi) failure to maintain insurance as required by this Agreement to the extent that the revenue from the Properties is sufficient to pay the Insurance Premiums relating thereto (provided that Borrower shall have no liability for pay amounts deposited with Lender as Insurance Reserve Funds for Insurance Premiums to be paid to maintain such insurance where Lender elects not to apply such funds toward payment of such Insurance Premiums);
(vii) the breach of any representation, warranty, covenant or indemnification provision in the Environmental Indemnity Indemnity, this Agreement or in this Agreement any Security Instrument concerning Environmental Laws, Laws and Hazardous Substances and AsbestosSubstances;
(dviii) any fees or commissions paid by any Borrower after the removal or disposal by Borrower or any affiliate thereof occurrence of any portion of the Property after an Event of Default has occurred and while it is continuingto Guarantor, unless such portion and/or any Affiliate of any Borrower and/or Guarantor in violation of the Property is replaced by an item terms of equal the Note, this Agreement, the Security Instruments or greater value as determined by Lender in its reasonable discretionthe other Loan Documents;
(e) the misapplication or conversion by Borrower or any affiliate thereof of (iix) any insurance proceeds paid by reason Borrower’s breach of, or failure to comply with, the representations, warranties and covenants contained in Section 15.1 of any loss, damage or destruction to this Agreement and/or the Property, (ii) any awards or other amounts received in connection with the condemnation provisions of all or a portion of the Property, (iii) any Rents following an Event of Default or (iv) any Rents paid more than one (1) month in advanceSections 11.2 and 12.3 hereof;
(fx) any Borrower’s breach or failure to pay charges for labor or materials or taxes comply with the covenants, conditions and/or restrictions contained in the documents described on Schedule VII hereto and relating to the Properties known as Johnstown Industrial Park in Johnstown, New York and Crossroads Industrial Park in Gloversville, New York;
(xi) any litigation or other charges that can create liens superior legal proceeding related to the lien Debt filed by any Borrower, any SPE Component Entity, Guarantor, or any Borrower Party that delays, opposes, impedes, obstructs, hinders, enjoins or otherwise interferes with or frustrates the efforts of the Mortgage on Lender to exercise any portion of the Property unless such taxes or other charges are being contested in accordance herewith or such taxes or charges have been delivered rights and remedies available to Lender as provided herein and in accordance with Section 3.3 hereof the other Loan Documents, which the court in any such litigation or Borrower has complied with Section 5.2 hereofproceeding determines is frivolous, brought in bad faith or wholly without basis in fact or law; andand/or
(gxii) any security deposits collected by Borrower violation or any affiliate thereof with respect to the Property which are not delivered to Lender upon breach of a foreclosure of the Property representation, warranty or action covenant contained in lieu thereof, except to the extent any such security deposits were applied in accordance with the terms and conditions of any of the Leases prior to the occurrence of the Event of Default that gave rise to such foreclosure or action in lieu thereof. Section 5.1 hereof.
(b) Notwithstanding anything to the contrary in this Agreement, the Note or any of the Loan Documents Documents, (iA) Lender shall not be deemed to have waived any right which Lender may have under Section 506(a), 506(b), 1111(b) or any other provisions of the U.S. Bankruptcy Code to file a claim for the full amount of the Debt or to require that all collateral shall continue to secure all of the Debt owing to Lender in accordance with the Loan Documents, and (iiB) the Debt shall become be fully recourse to Borrower (but not its members (other than Guarantor solely to the extent provided in the Non-Recourse Guaranty) or other direct or indirect constituent members or partners or any other Person) Borrowers in the event that: (Ai) the first full Monthly Debt Service Payment Amount (as defined any violation of breach of any representation, warranty or covenant contained in the Note) under the Note is not paid when due; (B) other than in connection with a default under subsection (x) of the definition of Special Purpose Bankruptcy Remote Entity set forth in Schedule Article 5 hereto, Borrower fails to maintain its status as a Special Purpose Bankruptcy Remote Entity in accordance with the provisions of this Agreement and such failure which results in the substantive consolidation of the assets and liabilities of Borrower with another any other Person (other than the other Borrowers) as a result of such breach; (ii) if any Sale or Pledge occurs that is not a Permitted Transfer (iii) any Borrower or any SPE Component Entity files a voluntary petition under the Bankruptcy Code or any other Creditors Rights Laws; (iv) an Affiliate, officer, director, or representative which Controls, directly or indirectly, any Borrower or any SPE Component Entity files, or joins in the filing of, an involuntary petition against any Borrower or any SPE Component Entity under the Bankruptcy Code or any other Creditors Rights Laws, or solicits or causes to be solicited petitioning creditors for any involuntary petition against any Borrower or any SPE Component Entity from any Person; (Cv) except as otherwise permitted pursuant to the Loan Documents, any Borrower fails to obtain Lender’s prior written consent to any subordinate financing or other voluntary lien encumbering the Property; (D) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any assignment, transfer, or conveyance of the Property or any interest therein as and to the extent required by this Agreement or the Mortgage; or (E) (1) if any petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law, shall be filed by Borrower or Guarantor, or (2) if Borrower or Guarantor SPE Component Entity files an answer consenting to, to or otherwise acquiescing in or joining in, in any involuntary petition for bankruptcyfiled against it, reorganization by any other Person under the Bankruptcy Code or arrangement pursuant to federal bankruptcy lawany other Creditors Rights Laws, or solicits or causes to be solicited petitioning creditors for any similar involuntary petition from any Person; (vi) any Affiliate, officer, director, or representative which Controls any Borrower or any SPE Component Entity consents to or acquiesces in or joins in an application by a party other than Lender for the appointment of a custodian, receiver, trustee, or examiner for any Borrower, any SPE Component Entity or any portion of any Property; (vii) any Borrower or any SPE Component Entity makes an assignment for the benefit of creditors or admits in any legal proceeding, its insolvency or inability to generally pay its debts as they become due unless in each of the foregoing cases to do otherwise would require a false statement in any such legal proceeding or violate Rule 9011 of the Federal Rules of Bankruptcy Procedure or other applicable rules requiring a sufficient legal and factual basis for filing papers in a proceeding under Federal or state insolvency law or in connection with any other legal proceeding; (viii) there is substantive consolidation of any Borrower or any SPE Component Entity (or any Restricted Party) with any other Person (other than other Borrowers) in connection with any federal or state law filed against it by any other Person, or is found pursuant to a final, unappealable order of a court of competent jurisdiction to have solicited or caused to be solicited creditors to file any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, proceeding involving the Guarantor or any similar of its Affiliates; (ix) any Borrower or any SPE Component Entity (or any Affiliate of Borrower or any SPE Component Entity contests or opposes any motion made by Lender to obtain relief from the automatic stay or seeks to reinstate the automatic stay in the event of any federal or state law against Borrower bankruptcy or Guarantor, or (3) if Borrower or Guarantor are found, pursuant to a final unappealable order of a court of competent jurisdiction, to have been in collusion with creditors that initiate a bankruptcy action or insolvency proceeding against Borrower or involving the Guarantor or (F) an Event of Default described in Section 8.1(s) hereof shall have occurredits Affiliates.
Appears in 1 contract
Exculpation. Subject to the qualifications belowAnything contained herein, Lender shall not enforce the liability and obligation of Borrower or its constituent members, partners, shareholders, directors, employees or agents or the direct or indirect constituent members, partners, shareholders, directors, employees or agents thereof (collectively, the “Borrower Parties”) or any other Person, to perform and observe the obligations contained in this Agreement, the Note or in any other Loan Document to the contrary notwithstanding (except as set forth in the balance of this Section or in the Environmental Indemnity), no recourse shall be had for the payment of the principal or interest on the Note or for any other portion of the Debt hereunder or under the other Loan Documents by against (i) any action Affiliate, parent company, trustee or proceeding wherein advisor of Borrower or owner of a money judgment shall be sought against direct or indirect Beneficial or equitable interest in Borrower, any of the Borrower Parties member in Borrower, or any partner, shareholder or member therein (other Personthan against Guarantor pursuant to the Recourse Agreement); (ii) any legal representative, except that Lender may bring a foreclosure actionheir, an action for specific performance estate, successor or assign of any thereof; (iii) any corporation (or any other appropriate action officer, director, employee or proceeding shareholder thereof), individual or entity to enable Lender to enforce and realize upon the Property, the Rents which any ownership interest in Borrower shall have been transferred; (iv) any purchaser of any asset of Borrower; or (v) any other collateral given to Lender pursuant to this Agreement and the Person (except Borrower), for any deficiency or other Loan Documents; provided, however, that, except as specifically provided herein, any judgment in any such action or proceeding shall be enforceable against the Borrower Parties only sum owing with respect to the extent of their interest in Note or the Property, the Rents and in any other collateral given to Lender, and Lender, by accepting this Agreement, Debt. It is understood that the Note and the other Loan Documents, agrees that it shall Debt (except as set forth in the balance of this Section 12.24 and in the Environmental Indemnity) may not sxx for, seek or demand any deficiency judgment be enforced against any of the Borrower Parties Person described in clauses (i) through (v) above (other than against Guarantor as set forth in clause (i) above) and Lender agrees not to xxx or bring any other Person in any such legal action or proceeding under or by reason of or against any such Person in connection with this Agreementsuch respect. Notwithstanding the foregoing, the Note or any of the other Loan Documents. The provisions of this paragraph foregoing shall not, however, (i) constitute a waiver, release or impairment of any obligation evidenced or secured by this Agreement, the Note or any of the other Loan Documents; (ii) impair the right of Lender :
12.24.1 prevent recourse to name any of the Borrower Partiesor the assets of Borrower, as a party defendant in any action or suit for foreclosure and sale under the Mortgage; (iii) affect the validity or enforceability of any guaranty made in connection with the Loan or any rights and remedies of Lender thereunder; (iv) impair the right of Lender to obtain the appointment of a receiver; (v) impair the enforcement of the Assignment of Leases and Rents; Mortgage or (vi) constitute a waiver other instrument or document by which Borrower is bound pursuant to the Loan Documents,
12.24.2 prevent enforcement of the right of Lender Recourse Guaranty or Environmental Guaranty,
12.24.3 prevent recourse to enforce the liability and obligation Borrower or the assets of Borrower (but not against any members of Borrower (other than Guarantor to the extent provided in the Non-Recourse Guaranty) or their direct or indirect constituent members or partners or any other Person), by money judgment or otherwise, to the extent of for any loss, damage, cost, expense, liability, claim or other obligation (but excluding any punitive, consequential or speculative damages) incurred by Lender (including attorneys’ fees and costs reasonably incurred) arising out of or in connection with the following:
(a) fraud any breach of representation or intentional misrepresentation covenant by Borrower or Guarantor in connection with the Loanrespect to environmental matters and any indemnity with respect to environmental matters;
(b) any intentional physical waste of and material misrepresentation committed by the Property (includingBorrower, but not limited to, waste due to gross negligence) by Borrower the Guarantor or any affiliate thereof; provided, however, such physical waste shall exclude wear and tear to the Property that occurs in the ordinary course of business of the Property by Borrower or any affiliate thereoftheir respective Affiliates;
(c) the material breach misappropriation or misapplication by the Borrower or any of its Affiliates of any representationfunds (including misappropriation or misapplication of Rents, warrantysecurity deposits, covenant Renovation Advances and/or casualty or indemnification provision condemnation proceeds) in violation of the Environmental Indemnity express terms of the Loan Documents (provided this subparagraph (c) is not intended to create recourse for any such misappropriation or in this Agreement concerning Environmental Lawsmisapplication committed by any individual officer or employee of Borrower for his or her own benefit (as opposed to for the benefit of Borrower), Hazardous Substances and Asbestosto the extent carried out without the consent of Borrower);
(d) any fraud committed by the removal or disposal by Borrower Borrower, the Guarantor or any affiliate thereof of their respective Affiliates (provided this subparagraph (d) is not intended to create recourse for any portion such fraud committed by any individual officer or employee of Borrower for his or her own benefit (as opposed to for the Property after an Event benefit of Default has occurred and while it is continuingBorrower), unless such portion to the extent carried out without the consent of the Property is replaced by an item of equal or greater value as determined by Lender in its reasonable discretionBorrower);
(e) the misapplication or conversion by Borrower or any affiliate thereof of (i) any insurance proceeds paid by reason of any loss, damage or destruction to the Property, (ii) any awards or other amounts received in connection with the condemnation of all or a portion failure of the PropertyBorrower or, (iii) if applicable, its SPE Member at any Rents following an Event time, to be a Single-Purpose Entity in violation of Default or (iv) any Rents paid more than one (1) month in advanceSingle Purpose Entity covenants;
(f) failure to pay charges for labor or materials or taxes or other charges that can create liens superior to the lien of the Mortgage on any portion of the Property unless such taxes or other charges are being contested in accordance herewith or such taxes or charges have been delivered to Lender in accordance with Section 3.3 hereof or Borrower has complied with Section 5.2 hereof; and
(g) any security deposits collected by Borrower or any affiliate thereof intentional physical waste with respect to the Property which are not delivered to Lender upon a foreclosure committed by the Borrower, the Guarantor or any of the Property or action in lieu thereoftheir respective Affiliates, except or
12.24.4 prevent recourse to the extent any such security deposits were applied in accordance with Borrower or the terms and conditions assets of any of the Leases prior to the occurrence of the Event of Default that gave rise to such foreclosure or action in lieu thereof. Notwithstanding anything to the contrary in any of the Loan Documents (i) Lender shall not be deemed to have waived any right which Lender may have under Section 506(a), 506(b), 1111(b) or any other provisions of the U.S. Bankruptcy Code to file a claim Borrower for the full entire amount of the Debt or to require that all collateral shall continue to secure all of the Debt owing to Lender in accordance with the Loan Documents, and (ii) the Debt shall become fully recourse to Borrower (but not its members (other than Guarantor solely to the extent provided in the Non-Recourse Guaranty) or other direct or indirect constituent members or partners or any other Person) in the event that: (A) the first full Monthly Debt Service Payment Amount (as defined in the Note) under the Note is not paid when due; (B) other than in connection with a default under subsection (x) of the definition following:
(a) any Transfers or Change of Special Purpose Bankruptcy Remote Entity set forth Control in Schedule 5 hereto, Borrower fails to maintain its status as a Special Purpose Bankruptcy Remote Entity in accordance with violation of the terms and provisions of this Agreement and such failure results in the substantive consolidation of Agreement;
(b) if (X) a receiver, liquidator or trustee shall be appointed for Borrower with another Person; (C) except as otherwise permitted pursuant to the Loan Documents, or if Borrower fails to obtain Lender’s prior written consent to any subordinate financing shall be adjudicated a bankrupt or other voluntary lien encumbering the Property; (D) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any assignment, transferinsolvent, or conveyance of the Property or any interest therein as and to the extent required by this Agreement or the Mortgage; or (E) (1) if any petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law, shall be filed by Borrower or Guarantoragainst, or (2) if Borrower or Guarantor files an answer consenting consented to, or otherwise joining inacquiesced in by, Borrower, or if any proceeding for the dissolution or liquidation of Borrower shall be instituted and (Y) with respect to any such condition or event described in clause (X) of this subsection (b), either Borrower, any involuntary petition for bankruptcymember of Borrower, reorganization Guarantor or arrangement pursuant any Person owning an interest (directly or indirectly) in Borrower colludes or, to federal bankruptcy lawthe extent it has standing or legal right to do so, consents to or joins to cause such condition or event, or any similar federal fails to contest such condition or state law filed against it by any other Person, or is found pursuant to a final, unappealable order event. Notwithstanding the foregoing:
(i) in the event of a court voluntary bankruptcy filing of competent jurisdiction to Borrower, Lender may pursue any remedies that they would have solicited had if the provisions of this Section 12.24 were not in effect,
(ii) the phrase “any Person owning an interest (directly or caused to be solicited creditors to file any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law against Borrower or Guarantor, or (3indirectly) if Borrower or Guarantor are found, pursuant to a final unappealable order of a court of competent jurisdiction, to have been in collusion with creditors that initiate a bankruptcy action or proceeding against Borrower or Guarantor or (F) an Event of Default described Borrower” as contained in this Section 8.1(s) hereof shall have occurred.12.24.4
Appears in 1 contract
Samples: Loan Agreement (Colony Resorts LVH Acquisitions LLC)
Exculpation. Subject to the qualifications below, Lender shall not enforce the liability and obligation of Borrower or its constituent members, partners, shareholders, directors, employees or agents or the direct or indirect constituent members, partners, shareholders, directors, employees or agents thereof (collectively, the “Borrower Parties”) or any other Person, to perform and observe the obligations Obligations contained in the Note, this Agreement, the Note Mortgage or any of the other Loan Documents by any action or proceeding wherein a money judgment or any deficiency judgment or other judgment establishing personal liability shall be sought against Borrower or any Affiliate of Borrower or any legal representatives, successors or assigns of Borrower or its Affiliate or any principals, directors, officers, employees, beneficiaries, shareholders, partners, members, trustees, agents, or Affiliates of any of the Borrower Parties foregoing (collectively, but specifically excluding Guarantor to the extent of Guarantor’s liability under the Environmental Indemnity, the Guaranty, any Alterations Deficiency Guaranty or any other Personguaranty provided in connection with the Loan, the “Exculpated Parties”), except that Lender may bring a foreclosure action, an action for specific performance or any other appropriate action or proceeding to enable Lender to enforce and realize upon its interest under the Note, this Agreement, the Mortgage and the other Loan Documents, or in the Property, the Rents or any other collateral given to Lender pursuant to this Agreement and the other Loan Documents; provided, however, that, except as specifically provided herein, any judgment in any such action or proceeding shall be enforceable against the Borrower Parties only to the extent of their Borrower’s interest in the Property, in the Rents and in any other collateral given to Lender, and Lender, by accepting the Note, this Agreement, the Note Mortgage and the other Loan Documents, agrees that it shall not sxx xxx for, seek or demand any deficiency judgment against any of the Borrower Parties or any other Person Exculpated Party in any such action or proceeding under or by reason of or under or in connection with the Note, this Agreement, the Note Mortgage or any of the other Loan Documents. The provisions of this paragraph Section 10.1 shall not, however, (ia) constitute a waiver, release or impairment of any obligation evidenced or secured by this Agreement, the Note or any of the other Loan Documents; (iib) impair the right of Lender to name any of the Borrower Parties, as a party defendant in any action or suit for foreclosure and sale under the Mortgage; (iiic) affect the validity or enforceability of any of the Loan Documents, the Guaranty or any other guaranty made in connection with the Loan or any of the rights and remedies of Lender thereunder; (ivd) impair the right of Lender to obtain the appointment of a receiver; (ve) impair the enforcement of the Assignment of Leases and RentsLeases; (f) impair the enforcement of the Environmental Indemnity; (g) constitute a prohibition against Lender to seek a deficiency judgment against Borrower in order to fully realize the security granted by the Mortgage or to commence any other appropriate action or proceeding in order for Lender to exercise its remedies against the Property; or (vih) constitute a waiver of the right of Lender to enforce the liability and obligation of Borrower (but not against any members of Borrower (other than Guarantor to the extent provided in the Non-Recourse Guaranty) or their direct or indirect constituent members or partners or any other Person)Borrower, by money judgment or otherwise, to the extent of any loss, damage, cost, expense, liability, claim or other obligation (but excluding any punitive, consequential or speculative damages) reasonably incurred by Lender (including out-of-pocket attorneys’ fees and costs reasonably incurredincurred but excluding any consequential, special or punitive damages) arising out of or in connection with the following:following (all such liability and obligation of Borrower for any or all of the following being referred to herein as “Borrower’s Recourse Liabilities”):
(ai) fraud fraudulent acts, willful misconduct or material intentional misrepresentation by Borrower or Guarantor any Affiliate of Borrower in connection with the Loan;
(bii) intentional physical waste of the Property (including, but not limited to, waste due to gross negligence) breach by Borrower or any affiliate thereof; provided, however, such physical waste shall exclude wear and tear to the Property that occurs in the ordinary course of business of the Property by Borrower or any affiliate thereof;
(c) the material breach of any representation, warranty, covenant or indemnification provision in the Environmental Indemnity or in this Agreement concerning Environmental Laws, Hazardous Substances and AsbestosIndemnity;
(diii) the removal intentional misappropriation of any Rents, security deposits or disposal other income (including, without limitation, the proceeds of any letters of credit held in lieu of a security deposit) by Borrower or any affiliate thereof Affiliate of Borrower, except to the extent such amounts are applied to the payment of the Obligations or to the payment of operating expenses or Capital Expenditures or otherwise applied in accordance with the terms of the Loan Documents;
(iv) any portion intentional material physical waste of the Property after an Event of Default has occurred and while it is continuing, unless such portion of the Property is replaced by an item of equal or greater value as determined by Lender in its reasonable discretion;
(e) the misapplication or conversion by Borrower or any affiliate thereof Affiliate of Borrower;
(v) the commission of any criminal act by Borrower or any Affiliate of Borrower which results in the forfeiture of the Property;
(vi) the intentional misapplication by Borrower or any Affiliate of Borrower of (iA) any insurance proceeds Insurance Proceeds actually received by Borrower or any Affiliate of Borrower and not paid by reason of any loss, damage to Lender or destruction otherwise applied as required pursuant to the Propertyterms of this Agreement, (iiB) any awards Awards or other amounts received in connection with the condemnation Condemnation of all or a portion of the Property, (iii) Property actually received by Borrower or any Rents following an Event Affiliate of Default Borrower and not paid to Lender or (iv) any Rents paid more than one (1) month in advanceotherwise applied as required pursuant to the terms of this Agreement;
(fvii) failure to pay charges for labor all or materials or taxes or other charges that can create liens superior to the lien of the Mortgage on any portion of the Property unless such taxes being encumbered by a Lien voluntarily granted by Borrower in violation of the Loan Documents;
(viii) the voluntary incurrence by Borrower of any Indebtedness for borrowed money in violation of the provisions of this Agreement or any other charges are being contested in accordance herewith or such taxes or charges have been delivered Loan Document (other than Permitted Encumbrances and Permitted Indebtedness);
(ix) the failure by Borrower to deliver to Lender in accordance with Section 3.3 hereof or Borrower has complied with Section 5.2 hereof; and
(g) any security deposits, advance deposits or any other deposits collected by Borrower or any affiliate thereof Affiliated Manager with respect to the Property which are not delivered to Lender upon a foreclosure of the Property by Lender or any action in lieu thereof, thereof under the Loan Documents (except to the extent any that such security deposits were applied in accordance with the terms and conditions applicable lease or other governing document or Borrower did not have the legal right, because of a bankruptcy, receivership or similar judicial proceeding, to direct disbursement of such deposits); and/or
(x) the voluntary Transfer of all or any material portion of the Property or any direct or indirect interest therein or any Transfer of any direct or indirect interest in Borrower, in either case, in violation of the Leases prior to the occurrence of the Event of Default that gave rise to such foreclosure or action in lieu thereofLoan Documents. Notwithstanding anything to the contrary in this Agreement or any of the other Loan Documents Documents, (iA) Lender shall not be deemed to have waived any right which Lender may have under Section 506(a), 506(b), 1111(b) or any other provisions of the U.S. Bankruptcy Code to file a claim for the full amount of the Debt Obligations or to require that all collateral shall continue to secure all of the Debt Obligations owing to Lender in accordance with the Loan Documents, and (iiB) the Debt Obligations shall become be fully recourse to Borrower in the event that any of the following occur (but not its members each, a “Springing Recourse Event”): (i) a breach of the covenants set forth in Schedule V hereof (other than Guarantor solely those single purpose entity covenants that relate to solvency or adequacy of capital) that results in a substantive consolidation of the extent provided in the Non-Recourse Guaranty) or other direct or indirect constituent members or partners or assets and liabilities of Borrower with any other Person) in the event that: (A) the first full Monthly Debt Service Payment Amount (as defined in the Note) under the Note is not paid when due; (B) other than Person in connection with a default proceeding under subsection the Bankruptcy Code or under federal, state or foreign insolvency law (xother than on motion or pleading seeking a substantive consolidation brought or actively supported by Lender); (ii) Borrower or any Affiliate, officer, director or representative which controls Borrower consents to or files a voluntary petition with respect to Borrower under the Bankruptcy Code or any other Federal or state bankruptcy or insolvency law; (iii) Borrower files an application for the appointment of a receiver, trustee or examiner for Borrower or any portion of the definition Property, except at the request of Special Purpose Bankruptcy Remote Entity set forth in Schedule 5 hereto, Borrower fails to maintain its status as a Special Purpose Bankruptcy Remote Entity in accordance or with the provisions consent of this Agreement and such failure results Lender, (iv) the filing of an involuntary petition against Borrower under the Bankruptcy Code or any other Federal or state bankruptcy or insolvency law by any other Person in the substantive consolidation which Guarantor or an Affiliate of Guarantor colludes with and/or Guarantor or an Affiliate of Guarantor solicits or causes to be solicited petitioning creditors for any involuntary petition against Borrower with another by any Person; (Cv) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any subordinate financing or other voluntary lien encumbering the Property; (D) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any assignment, transfer, or conveyance of the Property or any interest therein as and to the extent required by this Agreement or the Mortgage; or (E) (1) if any petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law, shall be filed by Borrower or Guarantor, or (2) if Borrower or Guarantor files an answer consenting to, or otherwise joining in, any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law filed against it by any other PersonPerson under the Bankruptcy Code or any other Federal or state bankruptcy or insolvency law; or (vi) Borrower makes a general assignment for the benefit of creditors or admits, in writing or in any legal proceeding, its insolvency or inability to pay its debts as they become due, which admission is found pursuant to a final, unappealable order used as evidence of a court of competent jurisdiction to have solicited or caused to be solicited creditors to file any Borrower’s insolvency in connection with an involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, under the Bankruptcy Code or any similar federal other Federal or state bankruptcy or insolvency law against by a Person other than Lender (except for (A) any admissions that Borrower believes in good faith are truthful when made and (B) any such admission to Lender or Guarantorany servicer of the Loan that Borrower cannot pay its operating expenses (including Debt Service payments due in respect of the Loan) or that Borrower cannot refinance the Loan on the Maturity Date). Notwithstanding anything to the contrary contained herein, Borrower shall not have any liability hereunder (A) for or as a result of any unpaid obligation, lien or encumbrance (such as, without limitation, an obligation, lien or encumbrance for unpaid real estate taxes) resulting from insufficient cash flow at the Property or any Transfer resulting from any such unpaid obligation or Lien, except to the extent that such lack of cash flow arises from the misappropriation or conversion of revenue with respect to the Property, or (3B) if with respect to any acts, events or circumstances first arising after (1) the date on which Lender or a Person that is not an Affiliate of Borrower or Guarantor are foundacquires title to the Property, whether through foreclosure, private power of sale, the acceptance of a deed-in-lieu of foreclosure or otherwise, except with respect to acts taken by Borrower, Guarantor or any Affiliate of the foregoing on or after such date or (2) the date on which a receiver, trustee, liquidator or conservator, other than any such Person appointed at the request of Borrower, Guarantor or any Affiliate of the foregoing, takes control of the Property, except with respect to acts taken by Borrower, Guarantor or any Affiliate of the foregoing prior to or on or after such date, and further provided that the appointment of a receiver, trustee, liquidator or conservator shall not diminish, reduce or terminate Borrower’s or Guarantor’s liability pursuant to a final unappealable order of a court of competent jurisdictionthe Environmental Indemnity, to have been in collusion with creditors that initiate a bankruptcy action or proceeding against Borrower or Guarantor or (FC) an Event of Default described until such time that any notice and cure periods set forth in Section 8.1(s) hereof shall this Agreement or the other Loan Documents applicable to the action, event or circumstance from which such liability would arise, have occurredexpired.
Appears in 1 contract
Exculpation. (I) Subject to the qualifications below, Lender neither Agent nor Lenders shall not enforce the liability and obligation of Borrower or its constituent members, partners, shareholders, directors, employees or agents or the direct or indirect constituent members, partners, shareholders, directors, employees or agents thereof (collectively, the “Borrower Parties”) or any other Person, to perform and observe the obligations contained in the Note, this Agreement, the Note Pledge Agreement or any of the other Loan Documents by any action or proceeding wherein a money judgment or any deficiency judgment or other judgment establishing personal liability shall be sought against Borrower or any principal, director, officer, employee, beneficiary, shareholder, partner, member, trustee, agent, or affiliate of Borrower (but specifically excluding Guarantor) or any legal representatives, successors or assigns of any of the Borrower Parties or any other Personforegoing (collectively, the “Exculpated Parties”), except that Lender Agent may bring a foreclosure action, an action for specific performance or any other appropriate action or proceeding to enable Lender Agent and Lenders to enforce and realize upon its interest under the PropertyNote, this Agreement, the Rents Pledge Agreement and the other Loan Documents, or in the Collateral, or any other collateral given to Lender Agent and/or Lenders pursuant to this Agreement and the other Loan Documents; provided, however, that, except as specifically provided herein, any judgment in any such action or proceeding shall be enforceable against the Borrower Parties only to the extent of their Borrower’s interest in the Property, the Rents Collateral and in any other collateral given to LenderAgent, and LenderLenders and Agent, by accepting the Note, this Agreement, the Note Pledge Agreement and the other Loan Documents, agrees that it shall not sxx for, seek or demand any deficiency judgment against Borrower or any of the Borrower Parties or any other Person Exculpated Parties, in any such action or proceeding under or by reason of or under or in connection with the Note, this Agreement, the Note Mortgage or any of the other Loan Documents. The provisions of this paragraph Section shall not, however, (ia) constitute a waiver, release or impairment of any obligation evidenced or secured by this Agreement, the Note or any of the other Loan Documents; (iib) impair the right of Lender Agent or Lenders to name any of the Borrower Parties, as a party defendant in any action or suit for foreclosure and sale under the MortgagePledge Agreement; (iiic) affect the validity or enforceability of any guaranty indemnity, guaranty, or similar instrument made in connection with the Loan or any of the rights and remedies of Lender Agent or Lenders thereunder; (ivd) impair the right of Lender Agent or Lenders to obtain the appointment of a receiver; (ve) [intentionally omitted]; (f) impair the enforcement right of Agent or Lenders to enforce the provisions of the Assignment of Leases and RentsGuaranty or the Environmental Indemnity; (g) constitute a prohibition against Agent or Lenders to seek a deficiency judgment against Borrower in order to fully realize on any security given by Borrower in connection with the Loan or to commence any other appropriate action or proceeding in order for Agent or Lenders to exercise its remedies against such security; or (vih) constitute a waiver of the right of Lender to enforce the liability and obligation of Borrower (but not against any members of Borrower (other than Guarantor to the extent provided in the Non-Recourse Guaranty) or their direct or indirect constituent members or partners or any other Person)Borrower, by money judgment or otherwise, to the extent of any loss, damage, cost, expense, liability, claim or other obligation (but excluding any punitive, consequential or speculative damages) actual Losses incurred by Lender Agent and Lenders (including out-of-pocket attorneys’ fees and costs reasonably incurred) arising out of or in connection with the following:following (“Loss Liability”):
(ai) fraud or intentional misrepresentation by Mortgage Borrower, Borrower, Guarantor or any Borrower or Guarantor Party in connection with the Loan;
(b) intentional physical waste of the Property (including, but not limited to, waste due to gross negligence) by Borrower or any affiliate thereof; provided, however, such physical waste shall exclude wear and tear to the Property that occurs in the ordinary course of business of the Property by Borrower or any affiliate thereof;
(c) the material breach of any representation, warranty, covenant or indemnification provision in the Environmental Indemnity or in this Agreement concerning Environmental Laws, Hazardous Substances and Asbestos;
(d) the removal or disposal by Borrower or any affiliate thereof of any portion of the Property after an Event of Default has occurred and while it is continuing, unless such portion of the Property is replaced by an item of equal or greater value as determined by Lender in its reasonable discretion;
(e) the misapplication or conversion by Borrower or any affiliate thereof of (i) any insurance proceeds paid by reason of any loss, damage or destruction to the Property, (ii) any awards or other amounts received in connection with the condemnation of all or a portion of the Property, (iii) any Rents following an Event of Default or (iv) any Rents paid more than one (1) month in advance;
(f) failure to pay charges for labor or materials or taxes or other charges that can create liens superior to the lien of the Mortgage on any portion of the Property unless such taxes or other charges are being contested in accordance herewith or such taxes or charges have been delivered to Lender in accordance with Section 3.3 hereof or Borrower has complied with Section 5.2 hereof; and
(g) any security deposits collected by Borrower or any affiliate thereof with respect to the Property which are not delivered to Lender upon a foreclosure of the Property or action in lieu thereof, except to the extent any such security deposits were applied in accordance with the terms and conditions of any of the Leases prior to the occurrence of the Event of Default that gave rise to such foreclosure or action in lieu thereof. Notwithstanding anything to the contrary in any of the Loan Documents (i) Lender shall not be deemed to have waived any right which Lender may have under Section 506(a), 506(b), 1111(b) or any other provisions of the U.S. Bankruptcy Code to file a claim for the full amount of the Debt or to require that all collateral shall continue to secure all of the Debt owing to Lender in accordance with the Loan Documents, and (ii) the Debt shall become fully recourse to Borrower (but not its members (other than Guarantor solely to the extent provided in the Non-Recourse Guaranty) or other direct or indirect constituent members or partners or any other Person) in the event that: (A) the first full Monthly Debt Service Payment Amount (as defined in the Note) under the Note is not paid when due; (B) other than in connection with a default under subsection (x) of the definition of Special Purpose Bankruptcy Remote Entity set forth in Schedule 5 hereto, Borrower fails to maintain its status as a Special Purpose Bankruptcy Remote Entity in accordance with the provisions of this Agreement and such failure results in the substantive consolidation of Borrower with another Person; (C) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any subordinate financing or other voluntary lien encumbering the Property; (D) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any assignment, transfer, or conveyance of the Property or any interest therein as and to the extent required by this Agreement or the Mortgage; or (E) (1) if any petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law, shall be filed by Borrower or Guarantor, or (2) if Borrower or Guarantor files an answer consenting to, or otherwise joining in, any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law filed against it by any other Person, or is found pursuant to a final, unappealable order of a court of competent jurisdiction to have solicited or caused to be solicited creditors to file any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law against Borrower or Guarantor, or (3) if Borrower or Guarantor are found, pursuant to a final unappealable order of a court of competent jurisdiction, to have been in collusion with creditors that initiate a bankruptcy action or proceeding against Borrower or Guarantor or (F) an Event of Default described in Section 8.1(s) hereof shall have occurred.
Appears in 1 contract
Samples: Mezzanine Loan Agreement (Black Creek Diversified Property Fund Inc.)
Exculpation. Subject to the qualifications below, the Debt and the Other Obligations shall be non-recourse to Borrower, Guarantor and their respective Affiliates and Lender shall not enforce the liability and obligation of Borrower or its constituent members, partners, shareholders, directors, employees or agents or the direct or indirect constituent members, partners, shareholders, directors, employees or agents thereof (collectively, the “Borrower Parties”) or any other Person, to perform and observe the obligations contained in the Note, this Agreement, the Note Mortgage or any of the other Loan Documents by any action or proceeding wherein a money judgment shall be sought against any of the Borrower Parties or any other PersonBorrower, Guarantor and their respective Affiliates except that Lender may bring a foreclosure action, an action for specific performance of non-monetary obligations or any other appropriate action or proceeding to enable Lender to enforce and realize upon its interest under the Note, this Agreement, the Mortgage and the other Loan Documents, or in the Property, the Rents Rents, or any other collateral given to Lender pursuant to this Agreement and the other Loan Documents; provided, however, that, except as specifically provided herein, any judgment in any such action or proceeding shall be enforceable against the Borrower Parties only to the extent of their Borrower’s interest in the Property, in the Rents and in any other collateral given to Lender, and Lender, by accepting the Note, this Agreement, the Note Mortgage and the other Loan Documents, agrees that it shall not sxx xxx for, seek or demand any deficiency judgment against any of the Borrower Parties or any other Person its Affiliates in any such action or proceeding under or by reason of or under or in connection with the Note, this Agreement, the Note Mortgage or any of the other Loan Documents. The provisions of this paragraph Section 9.3 shall not, however, (ia) constitute a waiver, release or impairment of any obligation evidenced or secured by this Agreement, the Note or any of the other Loan Documents; (iib) impair the right of Lender to name any of the Borrower Parties, as a party defendant in any action or suit for foreclosure and sale under any of the Mortgage; (iiic) affect the validity or enforceability of the Guaranty or any other guaranty made in connection with the Loan or any of the rights and remedies of Lender thereunder; (ivd) impair the right of Lender to obtain the appointment of a receiverreceiver with respect to the Property; (ve) impair the enforcement of any of the Assignment of Leases and RentsLeases; (f) constitute a prohibition against Lender to seek a deficiency judgment against Borrower in order to fully realize the security granted by the Mortgage to the extent necessary to commence any other appropriate action or proceeding in order for Lender to exercise its remedies against all of the Property; or (vig) constitute a waiver of the right of Lender to enforce the liability and obligation of Borrower (but not against any members of Borrower (other than Guarantor to the extent provided in the Non-Recourse Guaranty) or their direct or indirect constituent members or partners or any other Person)Borrower, by money judgment or otherwise, to the extent of any actual loss, damage, cost, expense, liability, claim or other obligation (but excluding any punitive, consequential or speculative damages) actually incurred by Lender but excluding consequential, special or punitive damages (including attorneys’ fees and costs reasonably incurred) arising out of or in connection with the following:
(a) fraud or intentional misrepresentation by Borrower Borrower, Operating Lessee or Guarantor in connection with the Loan;
(b) intentional physical waste willful misconduct of the Property (including, but not limited to, waste due to gross negligence) by Borrower or any affiliate thereof; provided, however, such physical waste shall exclude wear and tear to the Property that occurs in the ordinary course of business of the Property by Borrower or any affiliate thereofOperating Lessee;
(c) damage to the material Property as a result of the gross negligence or willful misconduct of Borrower, Operating Lessee or Guarantor;
(d) the breach of any representation, warranty, covenant or indemnification provision in the Environmental Indemnity or in this Agreement concerning Environmental Lawsenvironmental laws, Hazardous Substances hazardous substances and Asbestos;
(d) the removal or disposal by Borrower or asbestos and any affiliate thereof indemnification of any portion of the Property after an Event of Default has occurred and while it is continuing, unless such portion of the Property is replaced by an item of equal or greater value as determined by Lender in its reasonable discretionwith respect thereto;
(e) the misapplication removal or disposal of any material portion of the Property by Borrower or Operating Lessee upon and during the continuance of an Event of Default in violation of the Loan Agreement;
(f) the misappropriation or conversion by Borrower or any affiliate thereof Operating Lessee of (iA) any insurance proceeds Insurance Proceeds paid by reason of any loss, damage or destruction Casualty to the Property, (iiB) any awards Awards or other amounts received in connection with the condemnation Condemnation of all or a portion of the Property, (iii) any Rents following an Event of Default or (iv) any Rents paid more than one (1) month in advance;
(f) failure to pay charges for labor or materials or taxes or other charges that can create liens superior to the lien of the Mortgage on any portion of the Property unless such taxes or other charges are being contested in accordance herewith or such taxes or charges have been delivered to Lender in accordance with Section 3.3 hereof or Borrower has complied with Section 5.2 hereof; and
(g) any security deposits collected by Borrower or any affiliate thereof with respect to the Property which are not delivered to Lender upon a foreclosure of the Property or action in lieu thereof, except to the extent any such security deposits were applied in accordance with the terms and conditions of any of the Leases prior to the occurrence of the Event of Default that gave rise to such foreclosure or action in lieu thereof. Notwithstanding anything to the contrary in any of the Loan Documents (i) Lender shall not be deemed to have waived any right which Lender may have under Section 506(a), 506(b), 1111(b) or any other provisions of the U.S. Bankruptcy Code to file a claim for the full amount of the Debt or to require that all collateral shall continue to secure all of the Debt owing to Lender in accordance with the Loan Documents, and (ii) the Debt shall become fully recourse to Borrower (but not its members (other than Guarantor solely to the extent provided in the Non-Recourse Guaranty) or other direct or indirect constituent members or partners or any other Person) in the event that: (A) the first full Monthly Debt Service Payment Amount (as defined in the Note) under the Note is not paid when due; (B) other than in connection with a default under subsection (x) of the definition of Special Purpose Bankruptcy Remote Entity set forth in Schedule 5 hereto, Borrower fails to maintain its status as a Special Purpose Bankruptcy Remote Entity in accordance with the provisions of this Agreement and such failure results in the substantive consolidation of Borrower with another Person; (C) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any subordinate financing or other voluntary lien encumbering the Property; (D) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any assignment, transfer, or conveyance of the Property or any interest therein as and to the extent required by this Agreement or the Mortgage; or (E) (1) if any petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law, shall be filed by Borrower or Guarantor, or (2) if Borrower or Guarantor files an answer consenting to, or otherwise joining in, any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law filed against it by any other Person, or is found pursuant to a final, unappealable order of a court of competent jurisdiction to have solicited or caused to be solicited creditors to file any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law against Borrower or Guarantor, or (3) if Borrower or Guarantor are found, pursuant to a final unappealable order of a court of competent jurisdiction, to have been in collusion with creditors that initiate a bankruptcy action or proceeding against Borrower or Guarantor or (F) an Event of Default described in Section 8.1(s) hereof shall have occurred.,
Appears in 1 contract
Exculpation. Subject to the qualifications below, Lender Administrative Agent shall not enforce the liability and obligation of Borrower or its constituent members, partners, shareholders, directors, employees or agents or the direct or indirect constituent members, partners, shareholders, directors, employees or agents thereof (collectively, the “Borrower Parties”) or any other Person, to perform and observe the obligations contained in the Note, this Agreement, the Note Mortgage or any of the other Loan Documents by any action or proceeding wherein a money judgment or any deficiency judgment or other judgment establishing personal liability shall be sought against any of the Borrower Parties or any other PersonParty, except that Lender Administrative Agent may bring a foreclosure action, an action for specific performance or any other appropriate action or proceeding to enable Lender Administrative Agent to enforce and realize upon its interest under the Note, this Agreement, the Mortgage and the other Loan Documents, or in the Property, the Rents Rents, or any other collateral given to Lender Administrative Agent pursuant to this Agreement and the other Loan Documents; provided, however, that, except as specifically provided herein, any judgment in any such action or proceeding shall be enforceable against the Borrower Parties only to the extent of their Borrower’s interest in the Property, in the Rents and in any other collateral given to LenderAdministrative Agent, for the benefit of Lenders, and LenderAdministrative Agent and Lenders, by accepting the Note, this Agreement, the Note Mortgage and the other Loan Documents, agrees that it shall not sxx sue for, seek or demand any deficiency judgment against any of the Borrower Parties or any other Person Borrower Party, in any such action or proceeding under or by reason of or under or in connection with the Note, this Agreement, the Note Mortgage or any of the other Loan Documents. The provisions of this paragraph Section 11.22 shall not, however, (ia) constitute a waiver, release or impairment of any obligation evidenced or secured by this Agreement, the Note or any of the other Loan Documents; (iib) impair the right of Lender Administrative Agent to name any of the Borrower Parties, Xxxxxxxx as a party defendant in any action or suit for foreclosure and sale of the Property under the Mortgage; (iiic) affect the validity or enforceability of any guaranty indemnity, guaranty, or similar instrument made in connection with the Loan or any of the rights and remedies of Lender Administrative Agent thereunder; (ivd) impair the right of Lender Administrative Agent to obtain the appointment of a receiver; (ve) impair the enforcement of the Assignment of Leases and RentsLeases; (f) impair the right of Administrative Agent to enforce the provisions of any Guaranty; (g) constitute a prohibition against Administrative Agent to seek a deficiency judgment against Borrower solely in order to fully realize on any security given by Borrower in connection with the Loan or to commence any other appropriate action or proceeding in order for Administrative Agent to exercise its remedies against such security; or (vih) constitute a waiver of the right of Lender Administrative Agent to enforce the liability and obligation of Borrower (but not against any members of Borrower (other than Guarantor to the extent provided in the Non-Recourse Guaranty) or their direct or indirect constituent members or partners or any other Person)Borrower, by money judgment or otherwise, to the extent of any loss, damage, cost, expense, liability, claim or other obligation (but excluding any punitive, consequential or speculative damages) actual Losses incurred by Administrative Agent and/or any Lender (including out-of-pocket attorneys’ fees and costs reasonably incurred, but excluding special, treble, consequential or punitive damages (except to the extent required to be paid by Administrative Agent and/or Lender to any third party) arising out of or in connection with the following:
: (a) willful misconduct, fraud or intentional material misrepresentation by a Borrower or Guarantor Party in connection with the Loan;
; (b) intentional physical waste of the Property (including, but not limited to, waste due to gross negligence) by Borrower or any affiliate thereof; provided, however, such physical waste shall exclude wear and tear to the Property that occurs in the ordinary course of business of the Property by Borrower or any affiliate thereof;
(c) the material breach of any representation, warranty, covenant or indemnification provision in the Environmental Indemnity or in this Agreement concerning Environmental Laws, Hazardous Substances and Asbestos;
(d) the removal or disposal by Borrower or any affiliate thereof of any portion of the Property after an Event of Default has occurred and while it is continuing, unless such portion of the Property is replaced by an item of equal or greater value as determined by Lender in its reasonable discretion;
(e) the misapplication misappropriation or conversion by Borrower or any affiliate thereof of (iA) any insurance proceeds Net Proceeds paid by reason of any loss, damage or destruction to the Property, (iiB) any awards or other amounts Awards received in connection with the condemnation of all or a portion of the PropertyCondemnation, (iiiC) any Rents following an Event or Gross Revenue of Default or any nature, (iv) any Rents paid more than one (1) month in advance;
(f) failure to pay charges for labor or materials or taxes or other charges that can create liens superior to the lien of the Mortgage on any portion of the Property unless such taxes or other charges are being contested in accordance herewith or such taxes or charges have been delivered to Lender in accordance with Section 3.3 hereof or Borrower has complied with Section 5.2 hereof; and
(gD) any security deposits, advance deposits or any other deposits collected by Borrower or any affiliate thereof with respect to the Property which are not delivered to Lender upon a foreclosure Administrative Agent, for the benefit of Lenders, in accordance with the Loan Documents (E) any Reserve Funds or Working Capital Funds or any funds held by Administrative Agent by or on behalf of Borrower under the Loan Documents or (F) any other funds due to Administrative Agent or any Lender, or any other Person, by Borrower under the Loan Documents; -162-
(c) any intentional material physical waste to all or any portion of the Property or action in lieu thereofProperty, except to the extent that (i) cash flow from the Property is insufficient to prevent such waste or (ii) Administrative Agent was required to under the Loan Documents and failed to make Excess Cash Flow available to Borrower during a Cash Trap Period; (d) removal of any portion of a Property or Improvements by any Borrower Related Party in violation of the Loan Documents during the continuance of an Event of Default; (e) forfeiture by Borrower of the Property, or any portion thereof, because of the conduct of criminal activity by any Borrower Party or any officer, director, manager, agent or employee of any of the foregoing, and any Person acting at the direction of any of the foregoing; (f) failure beyond applicable grace notice and cure periods of Borrower to (A) obtain and maintain the Policies required to be obtained and maintained in accordance with the provisions of the Loan Documents, and/or (B) pay when due any and all Insurance Premiums required to be paid in connection therewith until such security deposits were applied time as Borrower is no longer the owner of all or any portion of the Property, in each case, except to the extent that the cash flow from the Property is insufficient to pay such amounts, or to the extent that there are sufficient Insurance Funds on deposit in the Insurance Reserve Account allocated to pay such amounts and Administrative Agent fails to permit the release of such amounts in violation of Section 6.3.1, and Xxxxxxxx gives Administrative Agent written notice of such insufficiency at least 30 days’ prior to the date such amounts first become due and payable; (g) subject to Borrower’s right to contest the following in accordance with the terms and conditions of the Loan Documents, failure by Borrower to pay when due any and all Taxes and Other Charges, in each case, except to the extent that the cash flow from the Property is insufficient to pay such amounts, or to the extent that there are sufficient Tax Funds on deposit in the Tax Reserve Account allocated to pay such amounts and Administrative Agent fails to permit the release of such amounts in violation of Section 6.2.1, (h) any material breach by Borrower of the covenants contained in this Agreement or the other Loan Documents relating to the requirement that Borrower shall be a Special Purpose Bankruptcy Remote Entity (other than requirements related to Borrower’s solvency, maintenance of adequate capital, or failure to pay debts to the extent that the cash flow from the Property is insufficient to pay the same); (i) unless a court of competent jurisdiction issues a non-appealable final judgment in favor of Borrower or Guarantor, as applicable, in such action, all out-of-pocket costs and expenses (including, without limitation, attorneys’ fees and costs) incurred by Administrative Agent and/or Lender in connection with the interference, whether direct or indirect, by Borrower, any Guarantor or any of the Leases prior to the occurrence their respective Affiliates, with Administrative Agent’s or Lender’s exercise of the Event of Default that gave rise to such foreclosure rights or action in lieu thereof. Notwithstanding anything to the contrary in any of remedies under the Loan Documents (iincluding any foreclosure action or sale) Lender shall not be deemed to have waived any right which Lender may have under Section 506(a), 506(b), 1111(b) or any other provisions of the U.S. Bankruptcy Code to file a claim for the full amount of the Debt or to require that all collateral shall continue to secure all of the Debt owing to Lender in accordance with the Loan Documents, and whether by making any motion, bringing any counterclaim, claiming any defense, seeking any injunction or other restraint, commencing any action seeking to consolidate any such foreclosure or other enforcement with any other action or otherwise; or
(i) Borrower files a voluntary petition under the Bankruptcy Code or any other Federal or state bankruptcy or insolvency law; (ii) any Borrower Related Party solicits or causes to be solicited petitioning creditors for the Debt shall become fully recourse to filing by any Person(s) of any involuntary petition against Borrower (but not its members (other than Guarantor solely to under the extent provided in the Non-Recourse Guaranty) or other direct or indirect constituent members or partners Bankruptcy Code or any other Person) in the event that: (A) the first full Monthly Debt Service Payment Amount (as defined in the Note) Federal or state bankruptcy or insolvency law or an involuntary petition is filed against Borrower under the Note is not paid when due; (B) Bankruptcy Code or any other than in connection Federal or state bankruptcy or insolvency law by any Person with a default under subsection (x) of the definition of Special Purpose Bankruptcy Remote Entity set forth in Schedule 5 hereto, which any Borrower fails to maintain its status as a Special Purpose Bankruptcy Remote Entity in accordance with the provisions of this Agreement and such failure results in the substantive consolidation of Borrower with another Related Party colludes or otherwise assists Person; (Ciii) except as otherwise permitted pursuant to the Loan Documents, any Borrower fails to obtain Lender’s prior written consent to any subordinate financing or other voluntary lien encumbering the Property; (D) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any assignment, transfer, or conveyance of the Property or any interest therein as and to the extent required by this Agreement or the Mortgage; or (E) (1) if any petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law, shall be filed by Borrower or Guarantor, or (2) if Borrower or Guarantor Related Party files an answer consenting to, or otherwise joining acquiescing in, or joining in any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law filed against it Borrower, by any other PersonPerson under the Bankruptcy Code or any other Federal or state bankruptcy or insolvency Law (other than a petition filed against Borrower and/or SPC Party by Xxxxxx); (iv) any Borrower Related Party consents to or join in an application for the appointment of a custodian, receiver, trustee, or is found pursuant to a final, unappealable order of a court of competent jurisdiction to have solicited or caused to be solicited creditors to file any involuntary petition examiner for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, Borrower or any similar federal portion of the Property or state law against Borrower colludes with or Guarantor, or otherwise assists any Person in filing such an application (3) if Borrower or Guarantor are found, pursuant to a final unappealable order other than an application by Lender in connection with the enforcement of a court of competent jurisdiction, to have been in collusion with creditors that initiate a bankruptcy action or proceeding against Borrower or Guarantor or (F) an Event of Default described in Section 8.1(s) hereof shall have occurred.Xxxxxx’s remedies under the Loan Documents;
Appears in 1 contract
Samples: Senior Loan Agreement (Pacific Oak Strategic Opportunity REIT, Inc.)
Exculpation. Subject Notwithstanding any provision herein or in any of the other Loan Documents to the qualifications belowcontrary, Lender except as set forth in this Section 4.04, Payee shall not enforce the liability and obligation of Borrower or its constituent members, partners, shareholders, directors, employees or agents or the direct or indirect constituent members, partners, shareholders, directors, employees or agents thereof (collectively, the “Borrower Parties”) or any other Person, Maker to perform and observe the obligations contained in this AgreementNote, the Note Mortgages or any of the other Loan Documents by any an action or proceeding wherein a money judgment shall be sought against Maker or any judgment shall be sought against any director, officer, employee, partner or stockholder of Maker, or its general partners (all of the Borrower Parties or any other Personforegoing, except that Lender may bring a foreclosure actioncollectively, an action for specific performance or any other appropriate action or proceeding to enable Lender to enforce and realize upon the Property, the Rents or any other collateral given to Lender pursuant to this Agreement and the other Loan Documents; provided, however, that, except as specifically provided herein, any judgment in any such action or proceeding shall be enforceable against the Borrower Parties only to the extent of their interest in the Property, the Rents and in any other collateral given to Lender, and Lender"Principals"). Payee, by accepting this AgreementNote, the Note Mortgages and the other Loan Documents, agrees that it shall not sxx sue for, seek or demand any deficiency judgment against any of the Borrower Parties Maker or any other Person judgment, including a judgment for specific performance, against its Principals or any one or more of them in any such action or proceeding proceeding, under or by reason of or under or in connection with this AgreementNote, the Mortgages or the other Loan Documents except to the extent necessary or appropriate to proceed against or execute or foreclose on any or all of the collateral granted to Payee under the Loan Documents. The provisions of this Section 4.04 shall not, however, (a) impair the validity of the indebtedness evidenced by this Note or in any way affect or impair the lien of the Mortgages or any of the other Loan Documents. The provisions , or the right of Payee to foreclose the Mortgages or otherwise realize upon any collateral securing this paragraph shall not, however, (i) constitute a waiver, release or impairment Note following an Event of any obligation evidenced or secured by this Agreement, the Note or any of the other Loan DocumentsDefault; (iib) impair the right of Lender Payee to name Maker or any of the Borrower Parties, other Person as a party defendant in any action or suit for judicial foreclosure and sale or otherwise under the MortgageMortgages to the extent necessary to realize upon any collateral securing this Note; (iii) affect the validity or enforceability of any guaranty made in connection with the Loan or any rights and remedies of Lender thereunder; (ivc) impair the right of Lender Payee to obtain the appointment of a receiver; (vd) impair the enforcement of the Assignment of Leases and RentsAssignments; or (vie) constitute a waiver of impair the right of Lender Payee to enforce the bring suit with respect to, or Maker's personal liability and obligation of Borrower (but not against any members of Borrower (other than Guarantor to the extent provided in the Non-Recourse Guaranty) or their direct or indirect constituent members or partners or any other Person)for, by money judgment or otherwise, to the extent of any loss, damage, cost, expense, liability, claim or other obligation (but excluding any punitive, consequential or speculative damages) incurred by Lender (including attorneys’ fees and costs reasonably incurred) arising out of or in connection with the following:
(a) fraud or intentional misrepresentation by Borrower Maker or Guarantor any other Person in connection with this Note, the Loan;
Mortgages or any other Loan Document; (bf) intentional physical waste impair the right of Payee to bring suit with respect to, or Maker's personal liability for, Maker's misappropriation of tenant security deposits or Rents; (g) impair the right of Payee to obtain, or Maker's personal liability for Maker's misapplication or misappropriation of insurance proceeds or condemnation awards due to Payee under the Mortgages; (h) impair the right of Payee to enforce, or Maker's personal liability for, the provisions of Section 16.01 or Section 16.02 of the Property Mortgages whether before or after payment in full of the Principal Amount; (includingi) prevent or in any way hinder Payee from exercising, but not limited or constitute a defense, or counterclaim or or-her basis for relief in respect of the exercise of, any other remedy against the collateral securing the Note as provided in the Loan Documents or as prescribed by law or in equity in case of Defaults; (j) prevent or in any way hinder Payee from exercising, or constitute a defense, a counterclaim, or other basis for relief in respect of the exercise of its remedies in respect of any judgments or other sums due from Maker to Payee other than under the Loan Documents; (k) impair the aright of Payee to bring suit with respect to, waste due to gross negligence) by Borrower or any affiliate thereof; providedMaker's personal liability for, howeverMaker's misappropriation, such physical waste shall exclude wear and tear to during the Property that occurs in the ordinary course continuance of business of the Property by Borrower or any affiliate thereof;
(c) the material breach of any representation, warranty, covenant or indemnification provision in the Environmental Indemnity or in this Agreement concerning Environmental Laws, Hazardous Substances and Asbestos;
(d) the removal or disposal by Borrower or any affiliate thereof of any portion of the Property after an Event of Default has occurred and while it is continuingDefault, unless such portion from any Cross-collateralized Property of the Property is replaced by an item any items of equal or greater value as determined by Lender in its reasonable discretion;
(e) the misapplication or conversion by Borrower personalty or any affiliate thereof fixtures or any other misappropriation with respect to any Cross-collateralized Property during the continuance of (i) any insurance proceeds paid by reason of any loss, damage or destruction to the Property, (ii) any awards or other amounts received in connection with the condemnation of all or a portion of the Property, (iii) any Rents following an Event of Default or (iv) any Rents paid more than one (1) month in advance;
(f) failure impair the right of Payee to pay charges for labor or materials or taxes or other charges that can create liens superior to the lien of the Mortgage on any portion of the Property unless such taxes or other charges are being contested in accordance herewith or such taxes or charges have been delivered to Lender in accordance with Section 3.3 hereof or Borrower has complied with Section 5.2 hereof; and
(g) any security deposits collected by Borrower or any affiliate thereof bring suit with respect to the Property which are not delivered to Lender upon a foreclosure of the Property to, or action Maker's personal liability for, losses, damages or liabilities suffered by Payee arising from any acts or omissions by Maker that resulted in lieu thereofwaste, except to the extent any such security deposits were applied in accordance with the terms and conditions of any of the Leases prior to the occurrence of the Event of Default provided, however, that gave rise to such foreclosure or action in lieu thereof. Notwithstanding anything to the contrary in any of the Loan Documents (i) Lender waste shall not be deemed to have waived any right which Lender may have under Section 506(a)include the non-payment of impositions, 506(b)mechanics liens, 1111(b) materialmen's liens or any other provisions of the U.S. Bankruptcy Code to file a claim for the full amount of the Debt or to require that all collateral shall continue to secure all of the Debt owing to Lender in accordance with the Loan Documents, and (ii) the Debt shall become fully recourse to Borrower (but not its members (other than Guarantor solely to the extent provided in the Non-Recourse Guaranty) or other direct or indirect constituent members or partners or any other Person) in the event that: (A) the first full Monthly Debt Service Payment Amount (as defined in the Note) under the Note is not paid when due; (B) other than in connection with a default under subsection (x) of the definition of Special Purpose Bankruptcy Remote Entity set forth in Schedule 5 hereto, Borrower fails to maintain its status as a Special Purpose Bankruptcy Remote Entity in accordance with the provisions of this Agreement and such failure results in the substantive consolidation of Borrower with another Person; (C) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any subordinate financing or other voluntary lien encumbering the Property; (D) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any assignment, transferliens arising from work performed on, or conveyance of the Property or any interest therein as and to the extent required by this Agreement or the Mortgage; or (E) (1) if any petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law, shall be filed by Borrower or Guarantor, or (2) if Borrower or Guarantor files an answer consenting materials delivered to, or otherwise joining in, any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law filed against it by any other Person, or is found pursuant to a final, unappealable order of a court of competent jurisdiction to have solicited or caused to be solicited creditors to file any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law against Borrower or Guarantor, or (3) if Borrower or Guarantor are found, pursuant to a final unappealable order of a court of competent jurisdiction, to have been in collusion with creditors that initiate a bankruptcy action or proceeding against Borrower or Guarantor or (F) an Event of Default described in Section 8.1(s) hereof shall have occurredthe Cross collateralized Properties.
Appears in 1 contract
Exculpation. Subject to the qualifications below(a) The Agent shall have no duties or responsibilities, Lender implied by application of law or otherwise, except those expressly set out in this Agreement. The Agent shall not enforce be required to make any decision or take any action which may expose it to personal liability or which, in its sole discretion, may be contrary to this Agreement or any Applicable Law. As between the liability Agent and obligation each of Borrower or the Lenders, neither the Agent nor any of its constituent members, partners, shareholdersofficers, directors, employees or agents shall be liable for any action taken or omitted to be taken under the direct or indirect constituent members, partners, shareholders, directors, employees or agents thereof (collectively, the “Borrower Parties”) or any other Person, to perform and observe the obligations contained in this Agreement, the Note or any of the other Loan Documents by any action or proceeding wherein a money judgment shall be sought against any of the Borrower Parties or any other Person, except that Lender may bring a foreclosure action, an action for specific performance or any other appropriate action or proceeding to enable Lender to enforce and realize upon the Property, the Rents or any other collateral given to Lender pursuant to this Agreement and the other Loan Documents; provided, however, that, except as specifically provided herein, any judgment in any such action or proceeding shall be enforceable against the Borrower Parties only to the extent of their interest in the Property, the Rents and in any other collateral given to Lender, and Lender, by accepting this Agreement, the Note and the other Loan Documents, agrees that it shall not sxx for, seek or demand any deficiency judgment against any of the Borrower Parties or any other Person in any such action or proceeding under or by reason of or in connection with this Agreement, the Note or any of the other Loan Documents. The provisions of this paragraph shall not, however, (i) constitute a waiver, release or impairment of any obligation evidenced or secured by this Agreement, the Note or any of the other Loan Documents; (ii) impair the right of Lender to name any of the Borrower Parties, as a party defendant in any action or suit for foreclosure and sale under the Mortgage; (iii) affect the validity or enforceability of any guaranty made in connection with the Loan Documents, unless caused by their fraudulent conduct or wilful misconduct. Nothing in this Agreement or any rights and remedies of Lender thereunder; (iv) impair the right of Lender to obtain the appointment of a receiver; (v) impair the enforcement of the Assignment of Leases and Rents; Loan Documents, expressed or (vi) constitute a waiver implied, is intended to, or shall be construed in any way so as to, impose upon the Agent any obligation except as expressly set out in this Agreement or the Loan Documents. Without limiting the generality of the right of Lender to enforce foregoing, the liability and obligation of Agent shall not be responsible for any calculation, recitals, statements, representations or warranties made by the Borrower (but not against or any members of Borrower (other than Guarantor to the extent provided in the Non-Recourse Guaranty) Loan Documents or their direct which may be contained in any Loan Document subsequently entered into by the Agent or indirect constituent members in any verbal or partners written information provided by the Borrower, any Guarantor or any other Person)Subsidiary thereof for the benefit of the Lenders or for the authorization, by money judgment execution, effectiveness, genuineness, validity or otherwiseenforceability of the Loan Documents or any other instruments and agreements referred to therein and shall not be required to make any inquiry or investigation concerning the performance, to the extent compliance or observance of any lossof the terms, damage, cost, expense, liability, claim provisions or conditions of the Loan Documents or any other obligation (but excluding any punitive, consequential instruments or speculative damages) incurred by Lender (including attorneys’ fees and costs reasonably incurred) agreements referred to therein or arising out of or in connection with the following:
(a) fraud or intentional misrepresentation by Borrower or Guarantor in connection with the Loan;therefrom.
(b) intentional physical waste Each of the Property (including, but not limited to, waste due to gross negligence) by Borrower or any affiliate thereof; provided, however, such physical waste shall exclude wear Lenders severally represents and tear warrants to the Property Agent that occurs in the ordinary course of business it has made and shall continue to make such independent investigation of the Property by Borrower or any affiliate thereof;
(c) the material breach of any representation, warranty, covenant or indemnification provision in the Environmental Indemnity or in this Agreement concerning Environmental Laws, Hazardous Substances financial condition and Asbestos;
(d) the removal or disposal by Borrower or any affiliate thereof of any portion affairs of the Property after an Event of Default has occurred Borrower and while it is continuing, unless the Guarantors as such portion of the Property is replaced by an item of equal or greater value as determined by Lender in its reasonable discretion;
(e) the misapplication or conversion by Borrower or any affiliate thereof of (i) any insurance proceeds paid by reason of any loss, damage or destruction deems for itself to the Property, (ii) any awards or other amounts received be appropriate in connection with the condemnation of all or a portion of the Property, (iii) any Rents following an Event of Default or (iv) any Rents paid more than one (1) month in advance;
(f) failure to pay charges for labor or materials or taxes or other charges that can create liens superior to the lien of the Mortgage on any portion of the Property unless such taxes or other charges are being contested in accordance herewith or such taxes or charges have been delivered to Lender in accordance with Section 3.3 hereof or Borrower has complied with Section 5.2 hereof; and
(g) any security deposits collected by Borrower or any affiliate thereof with respect to the Property which are not delivered to Lender upon a foreclosure of the Property or action in lieu thereof, except to the extent any such security deposits were applied in accordance with the terms and conditions of any of the Leases prior to the occurrence of the Event of Default that gave rise to such foreclosure or action in lieu thereof. Notwithstanding anything to the contrary in any of the Loan Documents (i) and the making and continuance of Advances under the Credit Facility, that such Lender has and shall continue to make its own appraisal of the creditworthiness of the Borrower and the Guarantors and that such Lender in connection with such investigation and appraisal has not relied upon any information provided to such Lender by the Agent, including any legal advice provided to the Agent by its counsel. The Agent may at any time request instructions or directions from the Lenders with respect to any actions or approvals which, by the terms of this Agreement, the Agent is permitted or required to take or to grant, and the Agent shall be absolutely entitled to refrain from taking any action or to withhold any approval and shall not be deemed under any liability whatsoever to any Lender for refraining from taking any action or withholding any approval under the Loan Documents until it has received such written instructions or directions from the Lenders. No Lender shall have waived any right which Lender may have under Section 506(a), 506(b), 1111(b) of action or any other provisions recourse whatsoever against the Agent as a result of the U.S. Bankruptcy Code to file a claim for the full amount Agent acting or refraining from acting under any of the Debt Loan Documents in accordance with instructions or directions received from the Lenders. The Lenders have reviewed the consequences of entering into and performing obligations and receiving amounts under this Agreement, including the Canadian income tax consequences in respect thereof, and are not relying on any information provided by the Agent, including any legal or tax advice provided to require that all collateral the Agent by its counsel. Execution Form CAL_LAW\ 1265540\5
(c) The Agent may consult with its own legal counsel, Borrower's Counsel, independent public accountants and other experts and advisors selected by it and shall continue not be liable for any action taken or omitted to secure all of the Debt owing to Lender be taken in good faith in accordance with the Loan Documentsadvice of such counsel, accountants, experts or advisors.
(d) The Agent does not make any warranty or representation to any Lender and (ii) is not responsible to any Lender for the Debt shall become fully recourse to Borrower (but not its members (other than Guarantor solely accuracy or completeness of any information or data made available to the extent provided in the Non-Recourse Guaranty) or other direct or indirect constituent members or partners or any other Person) in the event that: (A) the first full Monthly Debt Service Payment Amount (as defined in the Note) under the Note is not paid when due; (B) other than Lender in connection with a default under subsection (x) the syndication of the definition Credit Facility, or for any statements, warranties or representations (whether written or oral) made in or in connection with any of Special Purpose Bankruptcy Remote Entity set forth in Schedule 5 heretothe Loan Documents. The Agent shall have no duty to ascertain or to enquire as to the performance or observation of any of the terms, Borrower fails to maintain its status as a Special Purpose Bankruptcy Remote Entity in accordance with the provisions covenants or conditions of this Agreement and such failure results in the substantive consolidation of Borrower with another Person; (C) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent where applicable. The Agent shall not be responsible to any subordinate financing Lender for the due execution, legality, validity, enforcement, genuineness, sufficiency or other voluntary lien encumbering value of any of the Property; (D) except as otherwise permitted pursuant Loan Documents and shall not have any duty to procure funds for any payment required hereunder, including, without limitation, by charging any account of the Borrower maintained with the Agent for any amount due to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any assignment, transfer, or conveyance of the Property or any interest therein as and to the extent required by this Agreement or the Mortgage; or (E) (1) if any petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law, shall be filed by Borrower or Guarantor, or (2) if Borrower or Guarantor files an answer consenting to, or otherwise joining in, any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law filed against it by any other Person, or is found pursuant to a final, unappealable order of a court of competent jurisdiction to have solicited or caused to be solicited creditors to file any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law against Borrower or Guarantor, or (3) if Borrower or Guarantor are found, pursuant to a final unappealable order of a court of competent jurisdiction, to have been in collusion with creditors that initiate a bankruptcy action or proceeding against Borrower or Guarantor or (F) an Event of Default described in Section 8.1(s) hereof shall have occurredLenders hereunder.
Appears in 1 contract
Exculpation. Subject to the qualifications below, Lender (a) The Administrative Agent shall not enforce the liability and obligation of Borrower have any duties or its constituent members, partners, shareholders, directors, employees or agents or the direct or indirect constituent members, partners, shareholders, directors, employees or agents thereof (collectively, the “Borrower Parties”) or any other Person, to perform and observe the obligations contained in this Agreement, the Note or any of the other Loan Documents by any action or proceeding wherein a money judgment shall be sought against any of the Borrower Parties or any other Person, except that Lender may bring a foreclosure action, an action for specific performance or any other appropriate action or proceeding to enable Lender to enforce and realize upon the Property, the Rents or any other collateral given to Lender pursuant to this Agreement and the other Loan Documents; provided, however, that, except as specifically provided herein, any judgment in any such action or proceeding shall be enforceable against the Borrower Parties only to the extent of their interest in the Property, the Rents those expressly set forth herein and in any other collateral given to Lender, and Lender, by accepting this Agreement, the Note and the other Loan Documents, agrees that it and its duties hereunder shall be administrative in nature. Without limiting the generality of the foregoing, the Administrative Agent:
(i) shall not sxx forbe subject to any fiduciary or other implied duties, seek regardless of whether an Event of Default or demand Prepayment Event has occurred and is continuing;
(ii) shall not have any deficiency judgment against duty to take any discretionary action or exercise any discretionary powers, except discretionary rights and powers expressly contemplated hereby or by the other Loan Documents that the Administrative Agent is required to exercise as directed in writing by the Required Lenders (or such other number or percentage of the Lenders as shall be expressly provided for herein or in the other Loan Documents); provided that the Administrative Agent shall not be required to take any action that, in its opinion or the opinion of its counsel, may expose the Administrative Agent to liability or that is contrary to any Loan Document or applicable law, including for the avoidance of doubt any action that may be in violation of the automatic stay under any debtor relief law or that may effect a forfeiture, modification or termination of property of a Defaulting Lender in violation of any debtor relief law; and
(iii) shall not, except as expressly set forth herein and in the other Loan Documents, have any duty to disclose, and shall not be liable for the failure to disclose, 5160 WEIL:\98779117\5\64945.0060WEIL:\98789202\5\64945.0060
2216363.01 NYCSR03A - MSW any information relating to the Borrower or any of its Affiliates that is communicated to or obtained by the Person serving as the Administrative Agent or any of its Affiliates in any capacity.
(b) The Administrative Agent shall not be liable for any action taken or not taken by it (i) with the consent or at the request of the Required Lenders (or such other number or percentage of the Lenders as shall be necessary, or as the Administrative Agent shall believe in good faith shall be necessary, under the circumstances as provided in Sections 11.1 and 7.3), or (ii) in the absence of its own gross negligence or willful misconduct as determined by a court of competent jurisdiction by final and nonappealable judgment. The Administrative Agent shall be deemed not to have knowledge of any Event of Default or Prepayment Event unless and until notice describing such Event of Default or Prepayment Event is given to the Administrative Agent in writing by the Borrower Parties or a Lender.
(c) The Administrative Agent shall not be responsible for or have any other Person duty to ascertain or inquire into (i) any statement, warranty or representation made in any such action or proceeding under or by reason of or in connection with this Agreement, the Note or any of the other Loan Documents. The provisions of this paragraph shall not, however, (i) constitute a waiver, release or impairment of any obligation evidenced or secured by this Agreement, the Note or any of the other Loan Documents; (ii) impair the right of Lender to name any of the Borrower Parties, as a party defendant in any action or suit for foreclosure and sale under the Mortgage; (iii) affect the validity or enforceability of any guaranty made in connection with the Loan or any rights and remedies of Lender thereunder; (iv) impair the right of Lender to obtain the appointment of a receiver; (v) impair the enforcement of the Assignment of Leases and Rents; or (vi) constitute a waiver of the right of Lender to enforce the liability and obligation of Borrower (but not against any members of Borrower (other than Guarantor to the extent provided in the Non-Recourse Guaranty) or their direct or indirect constituent members or partners Agreement or any other Person), by money judgment or otherwise, to the extent of any loss, damage, cost, expense, liability, claim or other obligation (but excluding any punitive, consequential or speculative damages) incurred by Lender (including attorneys’ fees and costs reasonably incurred) arising out of or in connection with the following:
(a) fraud or intentional misrepresentation by Borrower or Guarantor in connection with the Loan;
(b) intentional physical waste of the Property (including, but not limited to, waste due to gross negligence) by Borrower or any affiliate thereof; provided, however, such physical waste shall exclude wear and tear to the Property that occurs in the ordinary course of business of the Property by Borrower or any affiliate thereof;
(c) the material breach of any representation, warranty, covenant or indemnification provision in the Environmental Indemnity or in this Agreement concerning Environmental Laws, Hazardous Substances and Asbestos;
(d) the removal or disposal by Borrower or any affiliate thereof of any portion of the Property after an Event of Default has occurred and while it is continuing, unless such portion of the Property is replaced by an item of equal or greater value as determined by Lender in its reasonable discretion;
(e) the misapplication or conversion by Borrower or any affiliate thereof of (i) any insurance proceeds paid by reason of any loss, damage or destruction to the PropertyLoan Document, (ii) the contents of any awards certificate, report or other amounts received document delivered hereunder or thereunder or in connection with the condemnation of all herewith or a portion of the Propertytherewith, (iii) any Rents following an Event of Default the performance or (iv) any Rents paid more than one (1) month in advance;
(f) failure to pay charges for labor or materials or taxes or other charges that can create liens superior to the lien of the Mortgage on any portion of the Property unless such taxes or other charges are being contested in accordance herewith or such taxes or charges have been delivered to Lender in accordance with Section 3.3 hereof or Borrower has complied with Section 5.2 hereof; and
(g) any security deposits collected by Borrower or any affiliate thereof with respect to the Property which are not delivered to Lender upon a foreclosure of the Property or action in lieu thereof, except to the extent any such security deposits were applied in accordance with the terms and conditions observance of any of the Leases prior to covenants, agreements or other terms or conditions set forth herein or therein or the occurrence of any Default, (iv) the Event validity, enforceability, effectiveness or genuineness of Default that gave rise to such foreclosure or action in lieu thereof. Notwithstanding anything to the contrary in this Agreement, any of the other Loan Documents (i) Lender shall not be deemed to have waived any right which Lender may have under Section 506(a), 506(b), 1111(b) Document or any other provisions of the U.S. Bankruptcy Code to file a claim for the full amount of the Debt agreement, instrument or to require that all collateral shall continue to secure all of the Debt owing to Lender in accordance with the Loan Documentsdocument, and or (iiv) the Debt shall become fully recourse to Borrower (but not its members (other than Guarantor solely to the extent provided in the Non-Recourse Guaranty) or other direct or indirect constituent members or partners or satisfaction of any other Person) in the event that: (A) the first full Monthly Debt Service Payment Amount (as defined in the Note) under the Note is not paid when due; (B) other than in connection with a default under subsection (x) of the definition of Special Purpose Bankruptcy Remote Entity condition set forth in Schedule 5 heretoArticle IV or elsewhere herein, Borrower fails other than to maintain its status as a Special Purpose Bankruptcy Remote Entity in accordance with the provisions confirm receipt of this Agreement and such failure results in the substantive consolidation of Borrower with another Person; (C) except as otherwise permitted pursuant items expressly required to be delivered to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any subordinate financing or other voluntary lien encumbering the Property; (D) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any assignment, transfer, or conveyance of the Property or any interest therein as and to the extent required by this Agreement or the Mortgage; or (E) (1) if any petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law, shall be filed by Borrower or Guarantor, or (2) if Borrower or Guarantor files an answer consenting to, or otherwise joining in, any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law filed against it by any other Person, or is found pursuant to a final, unappealable order of a court of competent jurisdiction to have solicited or caused to be solicited creditors to file any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law against Borrower or Guarantor, or (3) if Borrower or Guarantor are found, pursuant to a final unappealable order of a court of competent jurisdiction, to have been in collusion with creditors that initiate a bankruptcy action or proceeding against Borrower or Guarantor or (F) an Event of Default described in Section 8.1(s) hereof shall have occurredAdministrative Agent.
Appears in 1 contract
Exculpation. Subject to Except as otherwise provided herein or in the qualifications belowother Loan Documents, Lender shall not enforce the liability and obligation of Borrower or its constituent membersBorrower Principal, partners, shareholders, directors, employees or agents or the direct or indirect constituent members, partners, shareholders, directors, employees or agents thereof (collectively, the “Borrower Parties”) or any other Personas applicable, to pay, perform and and/or observe the obligations contained herein, in this Agreementthe Note, the Note or any of in the other Loan Documents by any action or proceeding against Borrower wherein a money judgment shall be sought against any Borrower, the members/partners of the Borrower Parties or any other PersonBorrower Principal or its respective members or partners, except that Lender may bring a foreclosure action, an action for specific performance or any other appropriate action or proceeding against Borrower to enable Lender to enforce and realize upon this Agreement, the Note, the Mortgage and the other Loan Documents, and the interest in the Property, the Rents or and any other collateral given to Lender pursuant to created by this Agreement Agreement, the Note, the Mortgage and the other Loan Documents; provided, however, that, except as specifically provided herein, that any judgment in any such action or proceeding shall be enforceable against the Borrower Parties only to the extent of their Borrower's interest in the Property, in the Rents and in any other collateral given to Lender, and . Lender, by accepting this Agreement, the Note Note, the Mortgage and the other Loan Documents, agrees that it shall not sxx not, except as otherwise provided in Section 15.1(b) and (c), sue for, seek or demand any deficiency judgment against any of the Borrower Parties or any other Person Bxxxower Principal in any such action or proceeding proceeding, under or by reason of or under or in connection with this Agreement, the Note Note, the Mortgage or any of the other Loan Documents. The provisions of this paragraph Section 15.1 shall not, however, (i) constitute a waiver, release or impairment of any obligation evidenced or secured by this Agreement, the Note Note, the Mortgage or any of the other Loan Documents; (ii) impair the right of Lender to name any of the Borrower Parties, as a party defendant in any action or suit for judicial foreclosure and sale under this Agreement and the Mortgage; (iii) affect the validity or enforceability of any guaranty indemnity (including, without limitation, those contained in Section 12.6, Section 13.5 and Article 14 of this Agreement), made in connection with this Agreement, the Note, the Mortgage and the other Loan or any rights and remedies of Lender thereunderDocuments; (iv) impair the right of Lender to obtain the appointment of a receiver; (v) impair the enforcement of the Assignment assignment of Leases and Rentsleases provisions contained in the Mortgage; or (vi) constitute a waiver of impair the right of Lender to obtain a deficiency judgment against Borrower or other judgment on the Note against Borrower if necessary to obtain any Insurance Proceeds or Awards to which Lender would otherwise be entitled under this Agreement; provided however, Lender shall only enforce the liability and obligation of Borrower (but not against any members of Borrower (other than Guarantor to the extent provided in the Non-Recourse Guaranty) or their direct or indirect constituent members or partners or any other Person), by money such judgment or otherwise, to the extent of any loss, damage, cost, expense, liability, claim or other obligation (but excluding any punitive, consequential or speculative damages) incurred by Lender (including attorneys’ fees and costs reasonably incurred) arising out of or in connection with the following:
(a) fraud or intentional misrepresentation by Borrower or Guarantor in connection with the Loan;
(b) intentional physical waste of the Property (including, but not limited to, waste due to gross negligence) by Borrower or any affiliate thereof; provided, however, such physical waste shall exclude wear and tear to the Property that occurs in the ordinary course of business of the Property by Borrower or any affiliate thereof;
(c) the material breach of any representation, warranty, covenant or indemnification provision in the Environmental Indemnity or in this Agreement concerning Environmental Laws, Hazardous Substances and Asbestos;
(d) the removal or disposal by Borrower or any affiliate thereof of any portion of the Property after an Event of Default has occurred and while it is continuing, unless such portion of the Property is replaced by an item of equal or greater value as determined by Lender in its reasonable discretion;
(e) the misapplication or conversion by Borrower or any affiliate thereof of (i) any insurance proceeds paid by reason of any loss, damage or destruction to the Property, (ii) any awards or other amounts received in connection with the condemnation of all or a portion of the Property, (iii) any Rents following an Event of Default or (iv) any Rents paid more than one (1) month in advance;
(f) failure to pay charges for labor or materials or taxes or other charges that can create liens superior to the lien of the Mortgage on any portion of the Property unless such taxes or other charges are being contested in accordance herewith or such taxes or charges have been delivered to Lender in accordance with Section 3.3 hereof or Borrower has complied with Section 5.2 hereof; and
(g) any security deposits collected by Borrower or any affiliate thereof with respect to the Property which are not delivered to Lender upon a foreclosure of the Property or action in lieu thereof, except to the extent any such security deposits were applied in accordance with the terms and conditions of any of the Leases prior to the occurrence of the Event of Default that gave rise to such foreclosure or action in lieu thereof. Notwithstanding anything to the contrary in any of the Loan Documents (i) Lender shall not be deemed to have waived any right which Lender may have under Section 506(a), 506(b), 1111(b) or any other provisions of the U.S. Bankruptcy Code to file a claim for the full amount of the Debt or to require that all collateral shall continue to secure all of the Debt owing to Lender in accordance with the Loan Documents, and (ii) the Debt shall become fully recourse to Borrower (but not its members (other than Guarantor solely to the extent provided in the Non-Recourse Guaranty) or other direct or indirect constituent members or partners or any other Person) in the event that: (A) the first full Monthly Debt Service Payment Amount (as defined in the Note) under the Note is not paid when due; (B) other than in connection with a default under subsection (x) of the definition of Special Purpose Bankruptcy Remote Entity set forth in Schedule 5 hereto, Borrower fails to maintain its status as a Special Purpose Bankruptcy Remote Entity in accordance with the provisions of this Agreement and such failure results in the substantive consolidation of Borrower with another Person; (C) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any subordinate financing or other voluntary lien encumbering the Property; (D) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any assignment, transfer, or conveyance of the Property or any interest therein as and to the extent required by this Agreement or the Mortgage; or (E) (1) if any petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law, shall be filed by Borrower or Guarantor, or (2) if Borrower or Guarantor files an answer consenting to, or otherwise joining in, any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law filed against it by any other Person, or is found pursuant to a final, unappealable order of a court of competent jurisdiction to have solicited or caused to be solicited creditors to file any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law against Borrower or Guarantor, or (3) if Borrower or Guarantor are found, pursuant to a final unappealable order of a court of competent jurisdiction, to have been in collusion with creditors that initiate a bankruptcy action or proceeding against Borrower or Guarantor or (F) an Event of Default described in Section 8.1(s) hereof shall have occurredInsurance Proceeds and/or Awards.
Appears in 1 contract
Samples: Loan Agreement (Sun Communities Inc)
Exculpation. Subject to the qualifications below, Lender neither Collateral Agent nor Administrative Agent shall not enforce the liability and obligation of Borrower or its constituent members, partners, shareholders, directors, employees or agents or the direct or indirect constituent members, partners, shareholders, directors, employees or agents thereof (collectively, the “Borrower Parties”) or any other Person, to perform and observe the obligations contained in any Note, this Agreement, the Note Pledge Agreement or any of the other Loan Documents by any action or proceeding wherein a money judgment shall be sought against any of the Borrower Parties or any other PersonBorrower, except that Lender Collateral Agent or Administrative Agent, as applicable, may bring a foreclosure action, an action for specific performance or any other appropriate action or proceeding to enable Lender Collateral Agent or Administrative Agent, as applicable, to enforce and realize upon its or the PropertyLenders’ interest under any Note, this Agreement, the Rents Pledge Agreement and the other Loan Documents, or in the Collateral or any other collateral given to Lender Collateral Agent pursuant to this Agreement and the other Loan Documents; provided, however, that, except as specifically provided herein, any judgment in any such action or proceeding shall be enforceable against the Borrower Parties only to the extent of their Borrower’s interest in the Property, the Rents Collateral and in any other collateral given to Collateral Agent, and each Lender, Collateral Agent and LenderAdministrative Agent, by accepting any Note, this Agreement, the Note Pledge Agreement and the other Loan Documents, as applicable, agrees that it shall not sxx xxx for, seek or demand any deficiency judgment against any of the Borrower Parties or any other Person in any such action or proceeding under or by reason of or under or in connection with any Note, this Agreement, the Note Pledge Agreement or any of the other Loan Documents. The provisions of this paragraph Section shall not, however, (ia) constitute a waiver, release or impairment of any obligation evidenced or secured by this Agreement, the Note or any of the other Loan Documents; (iib) impair the right of Lender Collateral Agent or Administrative Agent, as applicable, to name any of the Borrower Parties, as a party defendant in any action or suit for foreclosure and sale under the MortgagePledge Agreement; (iiic) affect the validity or enforceability of or any guaranty made in connection with the Loan or any of the rights and remedies of Lender Collateral Agent or Administrative Agent, as applicable, thereunder; (iv) impair the right of Lender to obtain the appointment of a receiver; (v) impair the enforcement of the Assignment of Leases and Rents; or (vi) constitute a waiver of the right of Lender to enforce the liability and obligation of Borrower (but not against any members of Borrower (other than Guarantor to the extent provided in the Non-Recourse Guaranty) or their direct or indirect constituent members or partners or any other Person), by money judgment or otherwise, to the extent of any loss, damage, cost, expense, liability, claim or other obligation (but excluding any punitive, consequential or speculative damages) incurred by Lender (including attorneys’ fees and costs reasonably incurred) arising out of or in connection with the following:
(a) fraud or intentional misrepresentation by Borrower or Guarantor in connection with the Loan;
(b) intentional physical waste of the Property (including, but not limited to, waste due to gross negligence) by Borrower or any affiliate thereof; provided, however, such physical waste shall exclude wear and tear to the Property that occurs in the ordinary course of business of the Property by Borrower or any affiliate thereof;
(c) the material breach of any representation, warranty, covenant or indemnification provision in the Environmental Indemnity or in this Agreement concerning Environmental Laws, Hazardous Substances and Asbestos;
(d) the removal or disposal by Borrower or any affiliate thereof of any portion of the Property after an Event of Default has occurred and while it is continuing, unless such portion of the Property is replaced by an item of equal or greater value as determined by Lender in its reasonable discretion;
(e) the misapplication or conversion by Borrower or any affiliate thereof of (i) any insurance proceeds paid by reason of any loss, damage or destruction to the Property, (ii) any awards or other amounts received in connection with the condemnation of all or a portion of the Property, (iii) any Rents following an Event of Default or (iv) any Rents paid more than one (1) month in advance;
(f) failure to pay charges for labor or materials or taxes or other charges that can create liens superior to the lien of the Mortgage on any portion of the Property unless such taxes or other charges are being contested in accordance herewith or such taxes or charges have been delivered to Lender in accordance with Section 3.3 hereof or Borrower has complied with Section 5.2 hereof; and
(g) any security deposits collected by Borrower or any affiliate thereof with respect to the Property which are not delivered to Lender upon a foreclosure of the Property or action in lieu thereof, except to the extent any such security deposits were applied in accordance with the terms and conditions of any of the Leases prior to the occurrence of the Event of Default that gave rise to such foreclosure or action in lieu thereof. Notwithstanding anything to the contrary in any of the Loan Documents (i) Lender shall not be deemed to have waived any right which Lender may have under Section 506(a), 506(b), 1111(b) or any other provisions of the U.S. Bankruptcy Code to file a claim for the full amount of the Debt or to require that all collateral shall continue to secure all of the Debt owing to Lender in accordance with the Loan Documents, and (ii) the Debt shall become fully recourse to Borrower (but not its members (other than Guarantor solely to the extent provided in the Non-Recourse Guaranty) or other direct or indirect constituent members or partners or any other Person) in the event that: (A) the first full Monthly Debt Service Payment Amount (as defined in the Note) under the Note is not paid when due; (B) other than in connection with a default under subsection (x) of the definition of Special Purpose Bankruptcy Remote Entity set forth in Schedule 5 hereto, Borrower fails to maintain its status as a Special Purpose Bankruptcy Remote Entity in accordance with the provisions of this Agreement and such failure results in the substantive consolidation of Borrower with another Person; (C) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any subordinate financing or other voluntary lien encumbering the Property; (D) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any assignment, transfer, or conveyance of the Property or any interest therein as and to the extent required by this Agreement or the Mortgage; or (E) (1) if any petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law, shall be filed by Borrower or Guarantor, or (2) if Borrower or Guarantor files an answer consenting to, or otherwise joining in, any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law filed against it by any other Person, or is found pursuant to a final, unappealable order of a court of competent jurisdiction to have solicited or caused to be solicited creditors to file any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law against Borrower or Guarantor, or (3) if Borrower or Guarantor are found, pursuant to a final unappealable order of a court of competent jurisdiction, to have been in collusion with creditors that initiate a bankruptcy action or proceeding against Borrower or Guarantor or (F) an Event of Default described in Section 8.1(s) hereof shall have occurred.
Appears in 1 contract
Exculpation. Subject (a) Notwithstanding anything in the Loan Documents to the contrary, but subject to the qualifications below, Lxxxxx and Borrower agree that:
(i) Borrower shall be liable upon the Debt and for the other obligations arising under the Loan Documents to the full extent (but only to the extent) of the security therefor; provided, however, that in the event (A) of fraud, willful misconduct or material misrepresentation by Borrower, or any of its principals, officers, managers, members or general partners, if any, its members, if any, its principals, its affiliates, its agents or its employees or by any Guarantor in connection with the loan evidenced by this Note, (B) of a breach or default under Sections 4.3 or 8.2 of the Security Instrument, or (C) the Property or any part thereof becomes an asset in a voluntary bankruptcy or insolvency proceeding, the limitation on recourse set forth in this Subsection 10(a) will be null and void and completely inapplicable, and this Note shall be with full recourse to Borrower. FIXED RATE NOTE (B LOAN) — Page 9 JPMorgan Chase Bank, N.A.
(ii) If a default occurs in the timely and proper payment of all or any part of the Debt, Lender shall not enforce the liability and obligation of Borrower or its constituent members, partners, shareholders, directors, employees or agents or the direct or indirect constituent members, partners, shareholders, directors, employees or agents thereof (collectively, the “Borrower Parties”) or any other Person, to perform and observe the obligations contained in this Agreement, the Note or any of the other Loan Documents Security Instrument by any action or proceeding wherein a money judgment shall be sought against any of the Borrower Parties or any other PersonBorrower, except that Lender may bring a foreclosure action, an action for specific performance or any other appropriate action or proceeding to enable Lender to enforce and realize upon the Security Instrument, the Other Loan Documents and the interest in the Property, the Rents or and any other collateral given to Lender pursuant to this Agreement created by the Security Instrument and the other Other Loan Documents; provided, however, that, except as specifically provided herein, that any judgment in any such action or proceeding shall be enforceable against the Borrower Parties only to the extent of their Borrower’s interest in the Property, in the Rents and in any other collateral given to Lender, and Lender. Lxxxxx, by accepting this Agreement, the Note and the other Loan DocumentsSecurity Instrument, agrees that it shall not sxx not, except as otherwise herein provided, sue for, seek or demand any deficiency judgment against any of the Borrower Parties or any other Person in any such action or proceeding proceeding, under or by reason of or under or in connection with this AgreementNote, the Note Other Loan Documents or any of the other Loan Documents. Security Instrument.
(iii) The provisions of this paragraph Subsection 10(a) shall not, however, not (iA) constitute a waiver, release or impairment of any obligation evidenced or secured by this AgreementNote, the Note Other Loan Documents or any of the other Loan DocumentsSecurity Instrument; (iiB) impair the right of Lender to name any of the Borrower Parties, as a party defendant in any action or suit for judicial foreclosure and sale under the MortgageSecurity Instrument; (iiiC) affect the validity or enforceability of any guaranty indemnity, guaranty, master lease or similar instrument made in connection with this Note, the Security Instrument, or the Other Loan or any rights and remedies of Lender thereunderDocuments; (ivD) impair the right of Lender to obtain the appointment of a receiver; (vE) impair the enforcement of the Assignment of Leases and Rentsexecuted in connection herewith; or (viF) constitute a waiver of impair the right of Lender to enforce the liability and obligation provisions of Borrower Article 11 of the Security Instrument; or (but not against any members G) impair the right of Borrower (other than Guarantor Lender to the extent provided in the Non-Recourse Guaranty) or their direct or indirect constituent members or partners or any other Person), by money obtain a deficiency judgment or otherwise, judgment on this Note against Borrower if necessary to obtain any insurance proceeds or condemnation awards to which Lxxxxx would otherwise be entitled under the extent of any loss, damage, cost, expense, liability, claim or other obligation (but excluding any punitive, consequential or speculative damages) incurred by Lender (including attorneys’ fees and costs reasonably incurred) arising out of or in connection with the following:
(a) fraud or intentional misrepresentation by Borrower or Guarantor in connection with the Loan;
(b) intentional physical waste of the Property (including, but not limited to, waste due to gross negligence) by Borrower or any affiliate thereofSecurity Instrument; provided, however, Lender shall only enforce such physical waste shall exclude wear and tear to judgment against the Property that occurs in the ordinary course of business of the Property by Borrower or any affiliate thereof;
(c) the material breach of any representation, warranty, covenant or indemnification provision in the Environmental Indemnity or in this Agreement concerning Environmental Laws, Hazardous Substances and Asbestos;
(d) the removal or disposal by Borrower or any affiliate thereof of any portion of the Property after an Event of Default has occurred and while it is continuing, unless such portion of the Property is replaced by an item of equal or greater value as determined by Lender in its reasonable discretion;
(e) the misapplication or conversion by Borrower or any affiliate thereof of (i) any insurance proceeds paid by reason of any loss, damage or destruction to the Property, (ii) any awards or other amounts received in connection with the and/or condemnation of all or a portion of the Property, (iii) any Rents following an Event of Default or awards,
(iv) any Rents paid more than one (1) month in advance;
(f) failure to pay charges for labor or materials or taxes or other charges that can create liens superior Notwithstanding the provisions of this Article to the lien of the Mortgage on any portion of the Property unless such taxes or other charges are being contested in accordance herewith or such taxes or charges have been delivered contrary, Borrower shall be personally liable to Lender in accordance with Section 3.3 hereof or Borrower has complied with Section 5.2 hereof; and
(g) any security deposits collected by Borrower or any affiliate thereof with respect to the Property which are not delivered to Lender upon a foreclosure of the Property or action in lieu thereof, except to the extent any such security deposits were applied in accordance with the terms and conditions of any of the Leases prior to the occurrence of the Event of Default that gave rise to such foreclosure or action in lieu thereof. Notwithstanding anything to the contrary in any of the Loan Documents (i) Lender shall not be deemed to have waived any right which Lender may have under Section 506(a), 506(b), 1111(b) or any other provisions of the U.S. Bankruptcy Code to file a claim for the full amount of the Debt or to require that all collateral shall continue to secure all of the Debt owing to Lender in accordance with the Loan Documents, and (ii) the Debt shall become fully recourse to Borrower (but not its members (other than Guarantor solely to the extent provided in the Non-Recourse Guaranty) or other direct or indirect constituent members or partners or any other Person) in the event thatLosses it incurs due to: (A) the first full Monthly Debt Service Payment Amount (as defined in the Note) under the Note is not paid when duemisapplication or misappropriation of Rents; (B) other than in connection with a default under subsection (x) the misapplication or misappropriation of the definition of Special Purpose Bankruptcy Remote Entity set forth in Schedule 5 hereto, Borrower fails to maintain its status as a Special Purpose Bankruptcy Remote Entity in accordance with the provisions of this Agreement and such failure results in the substantive consolidation of Borrower with another Personinsurance proceeds or condemnation awards; (C) except as otherwise permitted pursuant Borrower’s failure to return or to reimburse Lender for all Personal Property taken from the Loan Documents, Property by or on behalf of Borrower fails to obtain Lender’s prior written consent to any subordinate financing and not replaced with Personal Property of the same utility and of the same or other voluntary lien encumbering the Propertygreater value; (D) except as otherwise permitted pursuant to the Loan Documentsany act of actual waste or arson by Borrower, Borrower fails to obtain Lender’s prior written consent to any assignmentprincipal, transferaffiliate, general partner or conveyance of the Property member thereof or by any interest therein as and to the extent required by this Agreement or the MortgageGuarantor; or (E) (1) if any petition for bankruptcyfees or commissions paid by Borrower to any principal, reorganization affiliate, general partner or arrangement pursuant to federal bankruptcy lawmember of Borrower, or any similar federal Guarantor in violation of the terms of this Note, the Security Instrument or state lawthe Other Loan Documents; FIXED RATE NOTE (B LOAN) — Page 10 JPMorgan Chase Bank, shall be filed by Borrower or Guarantor, or (2) if Borrower or Guarantor files an answer consenting to, or otherwise joining in, any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law filed against it by any other Person, or is found pursuant to a final, unappealable order of a court of competent jurisdiction to have solicited or caused to be solicited creditors to file any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law against Borrower or Guarantor, or (3) if Borrower or Guarantor are found, pursuant to a final unappealable order of a court of competent jurisdiction, to have been in collusion with creditors that initiate a bankruptcy action or proceeding against Borrower or Guarantor or (F) an Event of Default described in Section 8.1(s) hereof shall have occurred.N.A.
Appears in 1 contract
Samples: Loan Agreement (AmREIT Monthly Income & Growth Fund III LTD)
Exculpation. Subject to To the qualifications belowextent permitted by applicable law, Lender shall not enforce the liability and obligation of Borrower or its constituent members, partners, shareholders, directors, employees or agents or the direct or indirect constituent members, partners, shareholders, directors, employees or agents thereof (collectively, the “Borrower Parties”) or any other Person, to perform and observe the obligations contained in this Agreement, the Note or any Grantee's acceptance of the other Loan Documents assignment covered by this Article 3, taking any action hereunder, or collection or receipt of Rents shall not, for any reason, be deemed to constitute Grantee a "mortgagee in possession," nor obligate Grantee to appear in or defend any action or proceeding wherein a money judgment shall be sought against relating to any of Lease, the Borrower Parties Rents, or any other Person, except that Lender may bring a foreclosure action, an action for specific performance or any other appropriate action or proceeding to enable Lender to enforce and realize upon the Mortgaged Property, the Rents take any action hereunder, expend any money, incur any expenses, or perform or discharge any other collateral given to Lender pursuant to this Agreement and the other Loan Documents; providedobligation, howeverduty, thator liability under any Lease, except as specifically provided herein, any judgment in any such action or proceeding shall be enforceable against the Borrower Parties only to the extent of their interest in the Property, the Rents and in any other collateral given to Lender, and Lender, by accepting this Agreement, the Note and the other Loan Documents, agrees that it shall not sxx for, seek or demand any deficiency judgment against any of the Borrower Parties or any other Person in any such action or proceeding under or by reason of or in connection with this Agreement, the Note or any of the other Loan Documents. The provisions of this paragraph shall not, however, (i) constitute a waiver, release or impairment of assume any obligation evidenced or secured by this Agreement, the Note or responsibility for any of the other Loan Documents; (ii) impair the right of Lender to name any of the Borrower Parties, as a party defendant in any action or suit for foreclosure and sale under the Mortgage; (iii) affect the validity or enforceability of any guaranty made in connection with the Loan or any rights and remedies of Lender thereunder; (iv) impair the right of Lender to obtain the appointment of a receiver; (v) impair the enforcement of the Assignment of Leases and Rents; or (vi) constitute a waiver of the right of Lender to enforce the liability and obligation of Borrower (but not against any members of Borrower (other than Guarantor to the extent provided in the Non-Recourse Guaranty) or their direct or indirect constituent members or partners or any other Person), by money judgment or otherwise, to the extent of any loss, damage, cost, expense, liability, claim or other obligation (but excluding any punitive, consequential or speculative damages) incurred by Lender (including attorneys’ fees and costs reasonably incurred) arising out of or in connection with the following:
(a) fraud or intentional misrepresentation by Borrower or Guarantor in connection with the Loan;
(b) intentional physical waste of the Property (including, but not limited to, waste due to gross negligence) by Borrower or any affiliate thereof; provided, however, such physical waste shall exclude wear and tear to the Property that occurs in the ordinary course of business of the Property by Borrower or any affiliate thereof;
(c) the material breach of any representation, warranty, covenant or indemnification provision in the Environmental Indemnity or in this Agreement concerning Environmental Laws, Hazardous Substances and Asbestos;
(d) the removal or disposal by Borrower or any affiliate thereof of any portion of the Property after an Event of Default has occurred and while it is continuing, unless such portion of the Property is replaced by an item of equal or greater value as determined by Lender in its reasonable discretion;
(e) the misapplication or conversion by Borrower or any affiliate thereof of (i) any insurance proceeds paid by reason of any loss, damage or destruction to the Property, (ii) any awards or other amounts received in connection with the condemnation of all or a portion of the Property, (iii) any Rents following an Event of Default or (iv) any Rents paid more than one (1) month in advance;
(f) failure to pay charges for labor or materials or taxes or other charges that can create liens superior to the lien of the Mortgage on any portion of the Property unless such taxes or other charges are being contested in accordance herewith or such taxes or charges have been deposit delivered to Lender in accordance with Section 3.3 hereof Grantor by any tenant, subtenant, licensee, user, or Borrower has complied with Section 5.2 hereof; and
(g) any security deposits collected by Borrower or any affiliate thereof with respect to the Property which are occupant and not delivered to Lender upon and accepted by Grantee. Grantee shall not be liable for any injury or damage to person or property in or about the Mortgaged Property or their failure to collect or exercise diligence in collecting Rents, but shall be accountable only for Rents that Grantee shall actually receive. In no event shall the right set forth in the assignment covered by this Article 3 effect or be construed to effect a foreclosure pro tanto reduction of the Property or action in lieu thereof, Secured Indebtedness except to the extent any such security deposits were applied in accordance with the terms and conditions of any of the Leases prior to extent, if at all, that Grantee actually receives, after the occurrence of a default and Grantee's election to pursue its rights under this Article 3, Rents and other sums directly from any tenant or subtenant and applies the Event of Default that gave rise to such foreclosure or action same in lieu thereof. Notwithstanding anything its discretion to the contrary in any Secured Indebtedness. The rights of the Loan Documents (i) Lender Grantee under this Article 3 shall not be deemed to have waived any right which Lender may have under Section 506(a), 506(b), 1111(b) or any cumulative of all other provisions rights of the U.S. Bankruptcy Code to file a claim for the full amount of the Debt or to require that all collateral shall continue to secure all of the Debt owing to Lender in accordance with the Loan Documents, and (ii) the Debt shall become fully recourse to Borrower (but not its members (other than Guarantor solely to the extent provided in the Non-Recourse Guaranty) or other direct or indirect constituent members or partners or any other Person) in the event that: (A) the first full Monthly Debt Service Payment Amount (as defined in the Note) Grantee under the Note is not paid when due; (B) other than in connection with a default under subsection (x) of the definition of Special Purpose Bankruptcy Remote Entity set forth in Schedule 5 hereto, Borrower fails to maintain its status as a Special Purpose Bankruptcy Remote Entity in accordance with the provisions of this Agreement and such failure results in the substantive consolidation of Borrower with another Person; (C) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any subordinate financing Financing Documents or other voluntary lien encumbering the Property; (D) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any assignment, transfer, or conveyance of the Property or any interest therein as and to the extent required by this Agreement or the Mortgage; or (E) (1) if any petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law, shall be filed by Borrower or Guarantor, or (2) if Borrower or Guarantor files an answer consenting to, or otherwise joining in, any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law filed against it by any other Person, or is found pursuant to a final, unappealable order of a court of competent jurisdiction to have solicited or caused to be solicited creditors to file any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law against Borrower or Guarantor, or (3) if Borrower or Guarantor are found, pursuant to a final unappealable order of a court of competent jurisdiction, to have been in collusion with creditors that initiate a bankruptcy action or proceeding against Borrower or Guarantor or (F) an Event of Default described in Section 8.1(s) hereof shall have occurredotherwise.
Appears in 1 contract
Samples: Deed of Trust, Assignment, Security Agreement and Financing Statement (Triathlon Broadcasting Co)
Exculpation. Subject (a) In dealing with this Agreement and any instruments, agreements or documents relating thereto, and in exercising or failing to exercise all or any of the qualifications below, Lender powers conferred upon the Representative hereunder or thereunder (i) the Representative shall not enforce the assume any, and shall incur no, responsibility or liability and obligation whatsoever to any Company Holder by reason of Borrower any error in judgment or its constituent members, partners, shareholders, directors, employees other act or agents omission performed or the direct omitted hereunder or indirect constituent members, partners, shareholders, directors, employees or agents thereof (collectively, the “Borrower Parties”) in connection with this Agreement or any other Persontransaction document, unless by the Representative's gross negligence or willful and intentional misconduct, and (ii) the Representative shall be entitled to perform rely on the advice of counsel, public accountants or other independent experts experienced in the matter at issue, and observe any error in judgment or other act or omission of the obligations Representative pursuant to such advice shall in no event subject the Representative to liability to any Company Holder unless by the Representative's gross negligence or willful and intentional misconduct. Except as set forth in the previous sentence, notwithstanding anything to the contrary contained in this Agreement, the Note Representative shall have no liability whatsoever to Parent or any of the other Loan Documents by any action or proceeding wherein a money judgment shall be sought against any of the Borrower Parties Surviving Corporation or any other Person. The Company Holders will indemnify, except that Lender may bring a foreclosure action, an action for specific performance or any other appropriate action or proceeding to enable Lender to enforce defend and realize upon hold harmless the Property, the Rents or any other collateral given to Lender pursuant to this Agreement Representative from and the other Loan Documents; provided, however, that, except as specifically provided herein, any judgment in any such action or proceeding shall be enforceable against the Borrower Parties only to the extent of their interest in the Property, the Rents and in any other collateral given to Lender, and Lender, by accepting this Agreement, the Note and the other Loan Documents, agrees that it shall not sxx for, seek or demand any deficiency judgment against any of the Borrower Parties or any other Person in any such action or proceeding under or by reason of or in connection with this Agreementand all losses, the Note or any of the other Loan Documents. The provisions of this paragraph shall notliabilities, howeverdamages, (i) constitute a waiverclaims, release or impairment of any obligation evidenced or secured by this Agreementpenalties, the Note or any of the other Loan Documents; (ii) impair the right of Lender to name any of the Borrower Partiesfines, as a party defendant in any action or suit for foreclosure forfeitures, actions, fees, costs and sale under the Mortgage; (iii) affect the validity or enforceability of any guaranty made in connection with the Loan or any rights and remedies of Lender thereunder; (iv) impair the right of Lender to obtain the appointment of a receiver; (v) impair the enforcement of the Assignment of Leases and Rents; or (vi) constitute a waiver of the right of Lender to enforce the liability and obligation of Borrower (but not against any members of Borrower (other than Guarantor to the extent provided in the Non-Recourse Guaranty) or their direct or indirect constituent members or partners or any other Person), by money judgment or otherwise, to the extent of any loss, damage, cost, expense, liability, claim or other obligation (but excluding any punitive, consequential or speculative damages) incurred by Lender expenses (including attorneys’ the fees and costs reasonably incurredexpenses of counsel and experts and their staffs and all expense of document location, duplication and shipment) (collectively, "Representative Losses") arising out of or in connection with the following:
(a) fraud or intentional misrepresentation by Borrower or Guarantor in connection with the Loan;
(b) intentional physical waste Representative's execution and performance of the Property (including, but not limited to, waste due to gross negligence) by Borrower this Agreement or any affiliate thereofother transaction document, in each case as such Representative Loss is suffered or incurred; provided, howeverthat in the event that any such Representative Loss is finally adjudicated to have been directly caused by the gross negligence or willful misconduct of the Representative, the Representative will reimburse the Company Holders the amount of such physical waste shall exclude wear and tear indemnified Representative Loss to the Property that occurs in extent attributable to such gross negligence or willful misconduct. If not paid directly to the ordinary course of business of Representative by the Property Company Holders, any such Representative Losses may be recovered by Borrower or any affiliate thereof;
(c) the material breach of any representation, warranty, covenant or indemnification provision in the Environmental Indemnity or in this Agreement concerning Environmental Laws, Hazardous Substances and Asbestos;
(d) the removal or disposal by Borrower or any affiliate thereof of any portion of the Property after an Event of Default has occurred and while it is continuing, unless such portion of the Property is replaced by an item of equal or greater value as determined by Lender in its reasonable discretion;
(e) the misapplication or conversion by Borrower or any affiliate thereof of Representative from (i) any insurance proceeds paid by reason of any loss, damage or destruction to the Property, (ii) any awards or other amounts received funds in connection with the condemnation of all or a portion of the Property, (iii) any Rents following an Event of Default or (iv) any Rents paid more than one (1) month in advance;
(f) failure to pay charges for labor or materials or taxes or other charges that can create liens superior to the lien of the Mortgage on any portion of the Property unless such taxes or other charges are being contested in accordance herewith or such taxes or charges have been delivered to Lender in accordance with Section 3.3 hereof or Borrower has complied with Section 5.2 hereof; and
(g) any security deposits collected by Borrower or any affiliate thereof with respect to the Property which are not delivered to Lender upon a foreclosure of the Property or action in lieu thereof, except to the extent any such security deposits were applied in accordance with the terms and conditions of any of the Leases prior to the occurrence of the Event of Default that gave rise to such foreclosure or action in lieu thereof. Notwithstanding anything to the contrary in any of the Loan Documents (i) Lender shall not be deemed to have waived any right which Lender may have under Section 506(a), 506(b), 1111(b) or any other provisions of the U.S. Bankruptcy Code to file a claim for the full amount of the Debt or to require that all collateral shall continue to secure all of the Debt owing to Lender in accordance with the Loan DocumentsRepresentative Reimbursement Amount, and (ii) the Debt shall become fully recourse to Borrower (but not its members (other than Guarantor solely amounts in the Escrow Fund at such time as remaining amounts would otherwise be distributable to the extent provided Company Holders; provided, that while this section allows the Representative to be paid from the Representative Reimbursement Amount and the Escrow Fund, this does not relieve the Company Holders from their obligation to promptly pay such Representative Losses as they are suffered or incurred, nor does it prevent the Representative from seeking any remedies available to it at law or otherwise. In no event will the Representative be required to advance its own funds on behalf of the Company Holders or otherwise. The Company Holders acknowledge and agree that the foregoing indemnities will survive the resignation or removal of the Representative or the termination of this Agreement. Notwithstanding the foregoing, no Company Holder shall have any liability with respect to Representative Losses in excess of the Non-Recourse GuarantyMerger Consideration received by such Company Holder.
(b) or other direct or indirect constituent members or partners or any other Person) in All of the event that: immunities and powers granted to the Representative under this Agreement shall survive until the earlier of (Ai) the first full Monthly Debt Service Payment Amount termination of this Agreement or (as defined in ii) the Note) under the Note is not paid when due; (B) other than in connection with a default under subsection (x) distribution of the definition Representative Reimbursement Amount to Company Holders pursuant to Section 8.2. The provisions of Special Purpose Bankruptcy Remote Entity set forth this ARTICLE VIII shall be binding upon the executors, heirs, legal representatives, successors and assigns of each Company Holder, and any references in Schedule 5 heretothis Agreement to a Company Holder or the Company Holders shall mean and include the successors to the Company Holders' rights hereunder, Borrower fails whether pursuant to maintain its status as a Special Purpose Bankruptcy Remote Entity in accordance with testamentary disposition, the provisions laws of descent and distribution or otherwise.
(c) The adoption of this Agreement and such failure results in the substantive consolidation approval of Borrower with another Person; (C) except as otherwise permitted pursuant the transactions contemplated hereby, including the Merger, by the Stockholder Approval shall also be deemed to constitute approval of all arrangements relating to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any subordinate financing or other voluntary lien encumbering the Property; (D) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any assignment, transfer, or conveyance of the Property or any interest therein as transactions contemplated hereby and to the extent required by provisions hereof binding upon the Voting Holders, including this Agreement Section 8.3.
(d) In no event shall any of the provisions set forth in this ARTICLE VIII be binding upon or result in any liability to Parent, Acquisition Sub, the Mortgage; or (E) (1) if any petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, Surviving Corporation or any similar federal of their respective directors, managers, officers, employees, agents, stockholders or state lawAffiliates (except to the extent that any such directors, shall be filed by Borrower managers, officers, employees, agents, stockholders or Guarantor, or (2) if Borrower or Guarantor files an answer consenting to, or otherwise joining in, any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law filed against it by any other Person, or Affiliates is found pursuant to a final, unappealable order of Company Holder and then only in their capacity as a court of competent jurisdiction to have solicited or caused to be solicited creditors to file any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law against Borrower or Guarantor, or (3) if Borrower or Guarantor are found, pursuant to a final unappealable order of a court of competent jurisdiction, to have been in collusion with creditors that initiate a bankruptcy action or proceeding against Borrower or Guarantor or (F) an Event of Default described in Section 8.1(s) hereof shall have occurredCompany Holder).
Appears in 1 contract
Exculpation. Subject to the qualifications below, Lender shall not enforce the liability and obligation of any Borrower or its constituent members, partners, shareholders, directors, employees or agents or the direct or indirect constituent members, partners, shareholders, directors, employees or agents thereof (collectively, the “"Borrower Parties”") or any other Person, to perform and observe the obligations contained in this Agreement, the Note or any of the other Loan Documents by any action or proceeding wherein a money judgment shall be sought against any of the Borrower Parties or any other Person, except that Lender may bring a foreclosure action, an action for specific performance or any other appropriate action or proceeding to enable Lender to enforce and realize upon the Property, the Rents or any other collateral given to Lender pursuant to this Agreement and the other Loan Documents; provided, however, that, except as specifically provided herein, any judgment in any such action or proceeding shall be enforceable against the Borrower Parties only to the extent of their interest in the Property, the Rents and in any other collateral given to Lender, and Lender, by accepting this Agreement, the Note and the other Loan Documents, agrees that it shall not sxx xxx for, seek or demand any deficiency judgment against any of the Borrower Parties or any other Person in any such action or proceeding under or by reason of or in connection with this Agreement, the Note or any of the other Loan Documents. The provisions of this paragraph shall not, however, (i) constitute a waiver, release or impairment of any obligation evidenced or secured by this Agreement, the Note or any of the other Loan Documents; (ii) impair the right of Lender to name any of the Borrower Parties, as a party defendant in any action or suit for foreclosure and sale under the Mortgage; (iii) affect the validity or enforceability of any guaranty made in connection with the Loan or any rights and remedies of Lender thereunder; (iv) impair the right of Lender to obtain the appointment of a receiver; (v) impair the enforcement of the Assignment of Leases and RentsRents executed in connection herewith; or (vi) constitute a waiver of the right of Lender to enforce the liability and obligation of Borrower Borrowers (but not against any members of Borrower Borrowers (other than Guarantor to the extent provided in the Non-Recourse GuarantyGuarantor) or their direct or indirect constituent members or partners or any other Person), by money judgment or otherwise, to the extent of any loss, damage, cost, expense, liability, claim or other obligation (but excluding any punitive, consequential or speculative damages) incurred by Lender (including attorneys’ fees and costs reasonably incurred) arising out of or in connection with the following:
(a) fraud or intentional misrepresentation by any Borrower or any Guarantor in connection with the Loan;
(b) intentional physical waste of the Property (including, but not limited to, waste due to gross negligence) by any Borrower or any affiliate thereof; provided, however, such physical waste shall exclude wear and tear to the Property that occurs in the ordinary course of business of the Property by any Borrower or any affiliate thereof;
(c) the material breach of any representation, warranty, covenant or indemnification provision in the that certain Environmental Indemnity and Hazardous Substance Indemnification Agreement of even date herewith given by Borrowers to Lender or in this Agreement concerning Environmental Laws, Hazardous Substances and Asbestos;
(d) the removal or disposal by any Borrower or any affiliate thereof of any portion of the Property after an Event of Default has occurred and while it is continuingDefault, unless such portion of the Property is replaced by an item of equal or greater value as determined by Lender in its reasonable discretion;
(e) the misapplication or conversion by any Borrower or any affiliate thereof of (i) any insurance proceeds paid by reason of any loss, damage or destruction to the Property, (ii) any awards or other amounts received in connection with the condemnation of all or a portion of the Property, (iii) any Rents following an Event of Default or (iv) any Rents paid more than one (1) month in advance;; 84
(f) failure to pay charges for labor or materials or taxes or other charges that can create liens superior to the lien of the Mortgage on any portion of the Property unless such taxes or other charges are being contested in accordance herewith or such taxes or charges have been delivered to Lender in accordance with Section 3.3 hereof or Borrower has complied with Section 5.2 hereof3.3; and
(g) any security deposits collected by Borrower Borrowers or any affiliate thereof with respect to the Property which are not delivered to Lender upon a foreclosure of the Property or action in lieu thereof, except to the extent any such security deposits were applied in accordance with the terms and conditions of any of the Leases prior to the occurrence of the Event of Default that gave rise to such foreclosure or action in lieu thereof. Notwithstanding anything to the contrary in any of the Loan Documents .
(i1) Lender shall not be deemed to have waived any right which Lender may have under Section 506(a), 506(b), 1111(b) or any other provisions of the U.S. Bankruptcy Code to file a claim for the full amount of the Debt or to require that all collateral shall continue to secure all of the Debt owing to Lender in accordance with the Loan Documents, and (ii) the Debt shall become fully recourse to Borrower (but not its members receiver (other than a receiver appointed by Lender), liquidator or trustee of any Borrower or Guarantor solely to the extent provided in the Non-Recourse Guaranty) or other direct or indirect constituent members or partners or any other Person) in the event that: (A) the first full Monthly Debt Service Payment Amount (as defined in the Note) under the Note shall be appointed which is not paid when due; dismissed within ninety (B90) other than in connection with a default under subsection (x) of the definition of Special Purpose Bankruptcy Remote Entity set forth in Schedule 5 hereto, Borrower fails to maintain its status as a Special Purpose Bankruptcy Remote Entity in accordance with the provisions of this Agreement and such failure results in the substantive consolidation of Borrower with another Person; (C) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any subordinate financing or other voluntary lien encumbering the Property; (D) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any assignment, transferdays, or conveyance of the Property or any interest therein as and to the extent required by this Agreement or the Mortgage; or (E) (12) if any petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law, shall be filed by any Borrower or Guarantor, or (23) if Borrower or Guarantor files an answer consenting to, or otherwise joining in, any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law filed against it by any other Person, or is found pursuant to a final, unappealable order of a court of competent jurisdiction to have solicited or caused to be solicited creditors to file any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law against any Borrower or Guarantor, or (34) if any Borrower or Guarantor are found, pursuant to a final unappealable order of a court of competent jurisdiction, to have been in collusion with creditors that initiate a bankruptcy action or proceeding against a Borrower or Guarantor or (F) an Event of Default described in Section 8.1(s) hereof shall have occurredGuarantor.
Appears in 1 contract
Exculpation. Subject to the qualifications below, Lender Agent shall not enforce the liability and obligation of Borrower or its constituent members, partners, shareholders, directors, employees or agents or the direct or indirect constituent members, partners, shareholders, directors, employees or agents thereof (collectively, the “Borrower Parties”) or any other Person, Security Guarantor to perform and observe the obligations contained in the Note, this Agreement, the Note Debenture, the Security Instrument or any of the other Loan Documents by any action or proceeding wherein a money judgment or any deficiency judgment or other judgment establishing personal liability shall be sought against any Borrower Party, any Affiliate of any Borrower Party, Sponsor, or any principal, director, officer, employee, beneficiary, shareholder, partner, member, trustee, agent, or Affiliate of any of the Borrower Parties foregoing (but specifically excluding Guarantor to the extent Guarantor becomes liable for the same under the Recourse Guaranty) or any other Personlegal representatives, successors or assigns of any of the foregoing (collectively, the “Exculpated Parties”), except that Lender Agent may bring a foreclosure action, an action for specific performance or any other appropriate action or proceeding to enable Lender Agent to enforce and realize upon its interest under the Note, this Agreement, the Security Instrument, the Debenture, and the other Loan Documents, or in the Property, the Rents Rents, or any other collateral given to Lender Agent pursuant to this Agreement and the other Loan Documents; provided, however, that, except as specifically provided herein, any judgment in any such action or proceeding shall be enforceable against the Borrower Parties or Security Guarantor only to the extent of their Borrower’s or Security Guarantor’s interest in the Property, in the Rents and in any other collateral given to LenderAgent, and Agent (on behalf of Lender), by accepting the Note, this Agreement, the Note Security Instrument, the Debenture, and the other Loan Documents, agrees that it shall not sxx xxx for, seek or demand any deficiency judgment against Borrower, Security Guarantor, or any of the Borrower Parties or any other Person Exculpated Parties, in any such action or proceeding under or by reason of or under or in connection with the Note, this Agreement, the Note Security Instrument, the Debenture, or any of the other Loan Documents. The provisions of this paragraph Section shall not, however, (ia) constitute a waiver, release or impairment of any obligation evidenced or secured by this Agreement, the Note or any of the other Loan Documents; (iib) impair the right of Agent or Lender to name any of the Borrower Parties, and/or Security Guarantor as a party defendant in any action or suit for foreclosure and sale under the MortgageSecurity Instrument or the Debenture; (iiic) affect the validity or enforceability of any guaranty indemnity, guaranty, or similar instrument made in connection with the Loan or any of the rights and remedies of Agent or Lender thereunder; (ivd) impair the right of Agent or Lender to obtain the appointment of a receiver; (ve) impair the enforcement of the Assignment assignment of Leases leases and Rentsrents contained in the Loan Documents; (f) impair the right of Agent or Lender to enforce the provisions of the Environmental Indemnity or of Section 4.1.6(h) hereof; (g) constitute a prohibition against Agent or Lender to seek a deficiency judgment against Borrower and/or Security Guarantor in order to fully realize on any security given by Borrower and/or Security Guarantor in connection with the Loan or to commence any other appropriate action or proceeding in order for Agent or Lender to exercise its remedies against such security; or (vih) constitute a waiver of the right of Agent or Lender to enforce the liability and obligation of Borrower (but not against any members of Borrower (other than Guarantor to the extent provided in the Non-Recourse Guaranty) or their direct or indirect constituent members or partners or any other Person)and/or Security Guarantor, by money judgment or otherwise, to the extent of any loss, damage, cost, expense, liability, claim or other obligation (but excluding any punitive, consequential or speculative damages) Losses incurred by Agent or Lender (including reasonable third-party attorneys’ fees and costs reasonably incurred) arising out of or in connection with any of the following:
(ai) fraud or intentional willful misrepresentation by any Borrower Party or Guarantor Sponsor in connection with the LoanLoan or the Property;
(bii) intentional physical waste the gross negligence or willful misconduct of any Borrower Party or Sponsor in connection with the Property (including, but not limited to, waste due to gross negligence) by Borrower Loan or any affiliate thereof; provided, however, such physical waste shall exclude wear and tear to the Property that occurs in the ordinary course of business of the Property by Borrower or any affiliate thereofProperty;
(ciii) the material breach of any representationindemnification obligations of Borrower, warranty, covenant or indemnification provision Security Guarantor and Guarantor in the Environmental Indemnity or in this Agreement concerning Environmental Laws, Hazardous Substances and Asbestosany other Loan Document;
(div) waste to the Property (or any portion thereof) caused by intentional acts or intentional omissions of any Borrower Party or Sponsor, or the removal or disposal by Borrower or any affiliate thereof of any portion of the Property after an Event of Default has occurred and while it is continuing, unless such portion of the Property is replaced by an item of equal or greater value as determined by Lender in its reasonable discretionDefault;
(ev) the misapplication misapplication, misappropriation or conversion by any Borrower Party or Sponsor of any affiliate thereof of the following, to the extent actually received by any Borrower Party or Sponsor: (iA) any insurance proceeds paid by reason of any loss, damage or destruction to the Property, (iiB) any awards Awards or other amounts received in connection with the condemnation Condemnation of all or a portion of the Property, or (iiiC) any Rents following an Event of Default or (ivD) any Tenant security deposits or Rents paid more than one (1) month collected in advance;
(fvi) any Personal Property taken from the Property by or at the direction of any Borrower Party or Sponsor and not replaced with Personal Property of the same utility and of the same of greater value, unless (A) such taken Personal Property is obsolete or otherwise has no material benefit to the use, operation, or value of the Property or (B) such actions were expressly permitted by the Loan Documents;
(vii) any act of arson by any Borrower Party or Sponsor;
(viii) any fees or commissions paid by Borrower or Security Guarantor or on behalf of Borrower or Security Guarantor after the occurrence of an Event of Default to any Exculpated Party in violation of the terms of the Note, this Agreement, the Security Instrument, the Debenture, or the other Loan Documents;
(ix) failure to (A) pay any charges for labor or materials relating to the Outstanding Work Costs in accordance with the terms and provisions thereof, that can create Liens on any portion of the Property, or taxes (B) pay Taxes, charges for labor or materials, or other charges that can create liens superior to the lien of the Mortgage Liens on any portion of the Property unless such taxes and/or the failure to pay Insurance Premiums or other charges are being contested in accordance herewith or such taxes or charges have been delivered to Lender maintain the Policies in accordance with Section 3.3 hereof or Borrower has complied with Section 5.2 the terms hereof; and
unless, with respect to any Taxes or charges referred to in clause (gB) any security deposits collected by Borrower hereof, (1) funds to pay such Taxes or any affiliate thereof charges were, at the time in question, available in the applicable Reserve Funds and Agent was obligated, but failed, to pay (or make such funds available to pay) such charges or (2) the Operating Income received during the period in question are insufficient to pay all of Borrower’s current and/or past due liabilities (including such charges) with respect to the Property and such charges and liabilities were incurred by Borrower as permitted pursuant to the Loan Documents;
(x) any security deposits, advance deposits or any other deposits collected with respect to any Individual Property which are not delivered to Lender Agent upon a foreclosure of the such Individual Property or action in lieu thereof, except to the extent any such security deposits were applied in accordance with the terms and conditions of any of the Leases prior to the occurrence of the Event of Default that gave rise to such foreclosure or action in lieu thereof;
(xi) any failure by Borrower and/or Security Guarantor to permit on-site inspections of any Individual Property as required by this Agreement and/or the other Loan Documents;
(xii) any failure of Borrower or Security Guarantor terminates any Franchise Agreement or Management Agreement and fails to appoint a replacement Manager or Franchisor in accordance with the terms of this Agreement; except to the extent Borrower or Security Guarantor proposes a Qualified Manager or Qualified Franchisor, as applicable, and Agent or Lender does not consent or unreasonably delays its consent to such Qualified Manager or Qualified Franchisor;
(xiii) if Borrower of Security Guarantor shall fail to indemnify any Lender Indemnitee from and against any and all Losses imposed upon or incurred by or asserted against any Lender Indemnitee and directly or indirectly arising out of or in any way relating to any tax, fee, or charge on the recording, and/or registering of any Security Instrument or any other Loan Document that is required to be filed, registered or recorded in accordance with the Loan Documents;
(xiv) the occurrence of any event due to political action and/or instability with respect to any Individual Property, to the extent any Losses arising out of such political action and/or instability would typically be covered by a political risk insurance policy, if the same were commercially available, which policy provides for typical coverage over (1) expropriatory acts of any Governmental Authority, (2) currency inconvertibility and non-transfer, (3) political violence, and (4) war and civil war;
(xv) the seizure or forfeiture of any Individual Property, or any portion thereof, or Borrower’s or Security Guarantor’s interest therein, resulting from criminal wrongdoing by any Borrower Party or Sponsor;
(xvi) Borrower or Security Guarantor fails to comply with the terms of Section 4.1.24 hereof following the occurrence and during the continuance of an Event of Default;
(xvii) Other than as set forth in clause (iii) of the paragraph below, Borrower or Security Guarantor fails to comply with any provision of Section 3.1.24 hereof or Pledgor or Pledgee fails to comply with any provision of Section 5(h) of the Pledge Agreement;
(xviii) Borrower or Security Guarantor terminates or otherwise cancels the Franchise Agreement in violation of this Agreement; and/or
(xix) Borrower’s or Security Guarantor’s use of the proceeds of the Loan other than in the manner and for the purposes set forth in Section 2.1.4 hereof. Notwithstanding anything to the contrary in this Agreement, the Note or any of the Loan Documents Documents, (iA) Agent and Lender shall not be deemed to have waived any right which Lender may have under Section 506(a), 506(b), 1111(b) or any other provisions of the U.S. Bankruptcy Code to file a claim for the full amount of the Debt or to require that all collateral shall continue to secure all of the Debt owing to Lender in accordance with the Loan Documents, and (iiB) the Debt shall become be fully recourse to Borrower (but not its members (other than and Security Guarantor solely to the extent provided in the Non-Recourse Guaranty) or other direct or indirect constituent members or partners or any other Person) in the event that: (Ai) the first full Monthly Debt Service Payment Amount (as defined in the Note) under the Note is not paid when dueintentionally omitted; (Bii) other than in connection with a default under subsection (x) of Subject to the definition of Special Purpose Bankruptcy Remote Entity terms and provisions set forth in Schedule 5 heretoSection 8.2 hereof, Borrower or Security Guarantor fails to maintain its status as a Special Purpose Bankruptcy Remote Entity in accordance comply with the provisions of this Agreement Section 4.2.1 hereof and such failure Article 8 hereof; (iii) Borrower or Security Guarantor fails to comply with any provision of Section 3.1.24 hereof or Pledgor or Pledgee fails to comply with any provision of Section 5(h) of the Pledge Agreement, in any case that results in the a substantive consolidation of Borrower any Restricted Party with another any other Person; (Civ) except as intentionally omitted; (v) Borrower, Security Guarantor, or any SPC Party files a voluntary petition under the Bankruptcy code or any other Federal or state bankruptcy or insolvency law; (vi) an Affiliate, officer, director, or representative which Controls, directly or indirectly, Borrower, Security Guarantor, or any SPC Party, files, or joins in the filing of, an involuntary petition against Borrower, Security Guarantor, or any SPC Party under the Bankruptcy Code or any other Federal or state bankruptcy or insolvency law, or solicits or causes to be solicited petitioning creditors for any involuntary petition against Borrower, Security Guarantor, or any SPC Party from any Person; (vii) Borrower, Security Guarantor, or any SPC Party files an answer consenting to or otherwise permitted pursuant affirmatively acquiescing in or joining in any involuntary petition filed against it, by any other Person (other than Lender, Agent, or any Lender Indemnitees) under the Bankruptcy Code or any other Federal or state bankruptcy or insolvency law, or solicits or causes to be solicited petitioning creditors for any involuntary petition from any Person; (viii) any Affiliate, officer, director, or representative which Controls Borrower, Security Guarantor, or any SPC Party consents to or affirmatively acquiesces in or joins in an application for the Loan Documentsappointment of a custodian, Borrower fails to obtain Lender’s prior written consent to receiver, trustee, or examiner for Borrower, Security Guarantor, or any subordinate financing SPC Party or other voluntary lien encumbering any portion of the Property; (Dix) except as otherwise permitted pursuant to the Loan DocumentsBorrower, Borrower fails to obtain Lender’s prior written consent to any assignment, transfer, or conveyance of the Property or any interest therein as and to the extent required by this Agreement or the Mortgage; or (E) (1) if any petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy lawSecurity Guarantor, or any similar SPC Party makes an assignment for the benefit of creditors, or admits, in writing or in any legal proceeding, its insolvency or inability to pay its debts as they become due; (x) [intentionally omitted], (xi) in the event of any federal or state lawbankruptcy or insolvency proceeding involving the Guarantor or its Affiliates, shall be filed by Borrower or if Borrower, Security Guarantor, or any Restricted Party contests or opposes any motion made by Agent or any Lender to obtain relief from the automatic stay or seeks to reinstate the automatic stay, if any, imposed in connection with such bankruptcy or insolvency proceeding; (2xii) if Borrower or Guarantor files an answer consenting toBorrower, or otherwise joining in, any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy lawSecurity Guarantor, or any similar federal Restricted Party accepts from any Guarantor or state law filed against it by Guarantor solicits or provides any other Persondebtor-in-possession financing to Borrower in the event Borrower, or is found pursuant to a final, unappealable order of a court of competent jurisdiction to have solicited or caused to be solicited creditors to file any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy lawSecurity Guarantor, or any similar federal Restricted Party is the subject of a bankruptcy or state law against Borrower or insolvency proceeding; (xiii) intentionally omitted; (xiv) Borrower, Security Guarantor, Guarantor, or (3) if any Borrower Party is finally judicially determined to have improperly and in bad faith to have taken any action of any kind or nature whatsoever, directly or indirectly, to delay, oppose, impede, obstruct, hinder, enjoin, otherwise interfere with the exercise by Agent of any and all of its and Lender’s rights and remedies against Borrower, Security Guarantor, Guarantor, any Borrower Party, and/or the Property, or any other rights or remedies of Agent or Lender with respect to the Loan, the Loan Documents or this Agreement. The obligations and liabilities of Borrower and Security Guarantor are foundunder this Section 11.22 shall fully survive indefinitely notwithstanding any termination, pursuant to a final unappealable order satisfaction, assignment, entry of a court judgment of competent jurisdictionforeclosure, to have been exercise of any power of sale, or delivery of a deed in collusion with creditors that initiate a bankruptcy action or proceeding against Borrower or Guarantor or (F) an Event lieu of Default described in Section 8.1(s) hereof shall have occurredforeclosure of the Security Instrument.
Appears in 1 contract
Exculpation. Subject to the qualifications below, Lender shall not enforce the liability and obligation of Borrower or its constituent members, partners, shareholders, directors, employees or agents or the direct or indirect constituent members, partners, shareholders, directors, employees or agents thereof (collectively, the “Borrower Parties”) or any other Person, to perform and observe the obligations contained in the Note, this Agreement, the Note Mortgage or any of the other Loan Documents by any action or proceeding wherein a money judgment shall be sought against any of the Borrower Parties or any other Persondirect or indirect members, partners or shareholders of Borrower or the employees, agents, directors or officers of Borrower or its Affiliates, except that Lender may bring an action against Borrower, including a foreclosure action, an action for specific performance or any other appropriate action or proceeding to enable Lender to enforce and realize upon its interest under the Note, this Agreement, the Mortgage and the other Loan Documents, or in the Property, the Rents Business Income, or any other collateral given to Lender pursuant to this Agreement and the Loan Documents or any other Loan Documentsassets of Borrower; provided, however, that, except as specifically provided herein, any judgment in any such action or proceeding shall be enforceable against the Borrower Parties only to the extent of their Borrower’s interest in the Property, in the Rents and Business Income in any other collateral given to LenderLender or any other assets of Borrower, and Lender, by accepting the Note, this Agreement, the Note Mortgage and the other Loan Documents, agrees that it shall not sxx xxx for, seek or demand any deficiency judgment against any of the Borrower Parties or any other Person monetary payment against Borrower or the direct or indirect members, partners or shareholders of Borrower or the employees, agents, directors or officers of Borrower or its Affiliates in any such action or proceeding under or by reason of or under or in connection with the Note, this Agreement, the Note Mortgage or any of the other Loan Documents. The provisions of this paragraph Section shall not, however, : (ia) constitute a waiver, release or impairment of any obligation evidenced or secured by this Agreement, the Note or any of the other Loan Documents; (iib) impair the right of Lender to name any of the Borrower Parties, as a party defendant in any action or suit for foreclosure and sale under the Mortgage; (iiic) affect the validity or enforceability of any guaranty or indemnity made in connection with the Loan (including, without limitation, the Guaranty) or any of the rights and remedies of Lender thereunder; (ivd) impair the right of Lender to obtain the appointment of a receiver; (ve) impair the enforcement of the Assignment of Leases and RentsLeases; or (vif) constitute a waiver prohibition against Lender to seek a deficiency judgment against Borrower in order to fully realize on any security given by Borrower in connection with the Loan (including the security granted by the Mortgage) or any other assets of Borrower or to commence any other appropriate action or proceeding in order for Lender to exercise its remedies against such security (including the right Property or any other assets of Borrower).
(a) Nothing contained in this Section 11.22 shall limit the rights of Lender to proceed against Borrower for any of the following (or against Guarantor under the Guaranty, on the additional terms and conditions thereof and subject to any limitations set forth herein or therein):
(i) to enforce any Leases entered into by Borrower or its Affiliates as Tenant;
(ii) to recover damages for fraud, material misrepresentation, material breach of warranty or intentional physical waste;
(iii) to recover any Condemnation Proceeds or Insurance Proceeds or other similar funds which have been misappropriated by Borrower or which, under the liability and obligation terms of the Loan Documents, should have been paid to Lender;
(iv) to recover (A) any Tenant security deposits, Tenant letters of credit or other deposits or fees paid to Borrower or (but B) prepaid rents for a period of more than thirty (30) days in advance of its due date which have not against any members been delivered to Lender;
(v) to recover Business Income received by Borrower during an Event of Borrower (other than Guarantor Default which have not been applied to the extent provided Loan or in accordance with the Non-Recourse GuarantyLoan Documents to operating and maintenance expenses of the Property;
(vi) or their direct or indirect constituent members or partners or any other Person)to recover damages, by money judgment or otherwisecosts and expenses arising from, to the extent of any loss, damage, cost, expense, liability, claim or other obligation (but excluding any punitive, consequential or speculative damages) incurred by Lender (including attorneys’ fees and costs reasonably incurred) arising out of or in connection with the following:provisions of the Mortgage pertaining to Hazardous Materials or the Environmental Indemnity;
(avii) fraud or intentional misrepresentation to recover any amount expended by Borrower or Guarantor Lender in connection with the Loanforeclosure of the Mortgage, but only in the event that any Borrower or any Guarantor takes action to impede such foreclosure or otherwise contests the foreclosure in bad faith;
(viii) to recover damages, costs and expenses arising from, or in connection with, the failure by Borrower to pay Taxes and Insurance Premiums when due to the extent that Borrower was not required to deposit such amounts with Lender pursuant to Section 6 hereof, but only to the extent there was available revenue from the Property for the period in question sufficient to pay such Taxes and Insurance Premiums, and provided further that Lender does not prevent such proceeds from being so applied;
(ix) to recover damages, costs and expenses arising from the failure of the representations set forth in Section 3.1.8 to be true or Borrower’s failure to comply with the provisions of Sections 4.2.11 of this Agreement; and
(x) to recover damages, costs and expenses arising from, or in connection with, any Lien arising from a written instrument executed by any Borrower or any Affiliate thereof expressly creating such Lien, to the extent such Lien is prohibited under this Agreement.
(b) intentional physical waste Notwithstanding the foregoing, the agreement of Lender not to limit recourse liability as set forth in Section 11.22(a) above SHALL BECOME NULL AND VOID and shall be of no further force and effect and the Debt shall be fully recourse to Borrower (and to Guarantor under the Guaranty, on the additional terms and conditions thereof and subject to any limitations set forth herein or therein) in the event that:
(i) any Borrower commences a voluntary bankruptcy or insolvency proceeding;
(ii) an involuntary bankruptcy or insolvency proceeding is commenced against any Borrower and is not dismissed within 90 days of filing; or
(iii) voluntary Transfer of the Property (including, but not limited to, waste due to gross negligence) occurs by written instrument executed by any Borrower or any affiliate Affiliate thereof; provided, howeverwhich instrument expressly effects such Transfer, such physical waste shall exclude wear and tear to the Property that occurs or a Secondary Financing is voluntarily incurred in the ordinary course of business violation of the Property Loan Documents, except as otherwise consented to by Borrower or any affiliate thereof;Lender in writing (which consent may be withheld in Lender’s sole discretion).
(c) Notwithstanding the material breach provisions of clauses (i) and (ii) of Section 11.22(b) no Guarantor shall be liable for any representation, warranty, covenant or indemnification provision in the Environmental Indemnity or in this Agreement concerning Environmental Laws, Hazardous Substances and Asbestos;amount related to a Qualified Involuntary Bankruptcy.
(d) the removal or disposal by Borrower or In addition, this agreement shall not waive any affiliate thereof rights which Lender would have under any provisions of any portion Title 11 of the Property after an Event of Default has occurred and while it is continuing, unless such portion of the Property is replaced by an item of equal or greater value as determined by Lender in its reasonable discretion;
(e) the misapplication or conversion by Borrower or any affiliate thereof of (i) any insurance proceeds paid by reason of any loss, damage or destruction to the Property, (ii) any awards or other amounts received in connection with the condemnation of all or a portion of the Property, (iii) any Rents following an Event of Default or (iv) any Rents paid more than one (1) month in advance;
(f) failure to pay charges for labor or materials or taxes or other charges that can create liens superior to the lien of the Mortgage on any portion of the Property unless such taxes or other charges are being contested in accordance herewith or such taxes or charges have been delivered to Lender in accordance with Section 3.3 hereof or Borrower has complied with Section 5.2 hereof; and
(g) any security deposits collected by Borrower or any affiliate thereof with respect to the Property which are not delivered to Lender upon a foreclosure of the Property or action in lieu thereof, except to the extent any such security deposits were applied in accordance with the terms and conditions of any of the Leases prior to the occurrence of the Event of Default that gave rise to such foreclosure or action in lieu thereof. Notwithstanding anything to the contrary in any of the Loan Documents (i) Lender shall not be deemed to have waived any right which Lender may have under Section 506(a), 506(b), 1111(b) or any other provisions of the U.S. Bankruptcy Code to file a claim for the full amount of the Debt or to require that all collateral the Property shall continue to secure all of the Debt owing to Lender in accordance with the Loan Documents, and (ii) the Debt shall become fully recourse to Borrower (but not its members (other than Guarantor solely to the extent provided in the Non-Recourse Guaranty) or other direct or indirect constituent members or partners or any other Person) in the event that: (A) the first full Monthly Debt Service Payment Amount (as defined in the Note) under the Note is not paid when due; (B) other than in connection with a default under subsection (x) of the definition of Special Purpose Bankruptcy Remote Entity set forth in Schedule 5 hereto, Borrower fails to maintain its status as a Special Purpose Bankruptcy Remote Entity in accordance with the provisions of this Agreement and such failure results in the substantive consolidation of Borrower with another Person; (C) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any subordinate financing or other voluntary lien encumbering the Property; (D) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any assignment, transfer, or conveyance of the Property or any interest therein as and to the extent required by this Agreement or the Mortgage; or (E) (1) if any petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law, shall be filed by Borrower or Guarantor, or (2) if Borrower or Guarantor files an answer consenting to, or otherwise joining in, any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law filed against it by any other Person, or is found pursuant to a final, unappealable order of a court of competent jurisdiction to have solicited or caused to be solicited creditors to file any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law against Borrower or Guarantor, or (3) if Borrower or Guarantor are found, pursuant to a final unappealable order of a court of competent jurisdiction, to have been in collusion with creditors that initiate a bankruptcy action or proceeding against Borrower or Guarantor or (F) an Event of Default described in Section 8.1(s) hereof shall have occurredDebt.
Appears in 1 contract
Exculpation. Subject (a) Notwithstanding anything to the qualifications belowcontrary contained in this Note, the Security Instrument or any Other Security Document (but subject to the provisions of subsections (b), (c) and (d) of this Article 11), Lender shall not enforce the liability and obligation of Borrower or its constituent members, partners, shareholders, directors, employees or agents or the direct or indirect constituent members, partners, shareholders, directors, employees or agents thereof (collectively, the “Borrower Parties”) or any other Person, to perform and observe the obligations contained in this Agreement, the Note or any of the other Loan Documents Security Instrument by any action or proceeding wherein a money judgment or any deficiency judgment or other judgment establishing any personal liability shall be sought against Borrower or any principal, director, officer, employee, beneficiary, shareholder, partner, member, trustee, agent or affiliate of Borrower or any person owning, directly or indirectly, any legal or beneficial interest in Borrower, or any successors or assigns of any of the Borrower Parties or any other Personforegoing (collectively, the “Exculpated Parties”), except that Lender may bring a foreclosure action, an action for specific performance or any other appropriate action or proceeding to enable Lender to enforce and realize upon this Note, the Security Instrument, the Other Security Documents, and the interest in the Property, the Rents or (as defined in the Security Instrument) and any other collateral given to Lender pursuant to secure this Agreement and the other Loan DocumentsNote; provided, however, thatsubject to the provisions of subsections (b), except as specifically provided herein(c) and (d) of this Article 11, that any judgment in any such action or proceeding shall be enforceable against the Borrower Parties only to the extent of their Xxxxxxxx’s interest in the Property, in the Rents and in any other collateral given to Lender, and LenderLender to secure this Note. Xxxxxx, by accepting this Agreement, the Note and the other Loan DocumentsSecurity Instrument, agrees that it shall not sxx not, except as otherwise provided in this Article 11, sue for, seek or demand any deficiency judgment against Borrower or any of the Borrower Parties or any other Person Exculpated Parties, in any such action or proceeding proceeding, under or by reason of or under or in connection with this AgreementNote, the Note Security Instrument or any of the other Loan Other Security Documents. The provisions of this paragraph Article 11 shall not, however, (i) constitute a waiver, release or impairment of any obligation evidenced or secured by this AgreementNote, the Note Security Instrument or any of the other Loan DocumentsOther Security Documents delivered to Lender; (ii) impair the right of Lender to name any of the Borrower Parties, as a party defendant in any action or suit for judicial foreclosure and sale under the MortgageSecurity Instrument; (iii) affect the validity or enforceability of any guaranty indemnity, guaranty, master lease or similar instrument made in connection with this Note, the Loan Security Instrument, or any rights and remedies of Lender thereunderthe Other Security Documents; (iv) impair the right of Lender to obtain the appointment of a receiver; (v) impair the enforcement of the Assignment of Leases and RentsRents executed in connection herewith; or (vi) constitute a waiver of impair the right of Lender to enforce the liability and obligation provisions of Section 12.2 of the Security Instrument or of Section 3.12(e) of the Security Instrument; or (vii) impair the right of Lender to obtain a deficiency judgment or other judgment on the Note against Borrower if necessary to fully realize the security granted by the Security Instrument or to commence any other appropriate action or proceeding in order for Lender to exercise its remedies against the Property.
(but not against any members b) Notwithstanding the provisions of Borrower (other than Guarantor this Article II to the extent provided contrary, Borrower shall be personally liable to Lender for the Losses (as defined in the Non-Recourse GuarantySecurity Instrument) or their direct or indirect constituent members or partners or any other Person), by money judgment or otherwise, to the extent of any loss, damage, cost, expense, liability, claim or other obligation Lender incurs due to: (but excluding any punitive, consequential or speculative damages) incurred by Lender (including attorneys’ fees and costs reasonably incurred) arising out of or in connection with the following:
(ai) fraud or intentional misrepresentation by Borrower or Guarantor any of the Exculpated Parties in connection with the Loan;
; (b) intentional physical waste of the Property (including, but not limited to, waste due to gross negligence) by Borrower or any affiliate thereof; provided, however, such physical waste shall exclude wear and tear to the Property that occurs in the ordinary course of business of the Property by Borrower or any affiliate thereof;
(cii) the material breach gross negligence or willful misconduct of any representation, warranty, covenant or indemnification provision in the Environmental Indemnity or in this Agreement concerning Environmental Laws, Hazardous Substances and Asbestos;
Borrower; (diii) the removal or disposal by Borrower or any affiliate thereof of any portion of the Property after an Event of Default has occurred and while it is continuingDefault; (iv) Borrower’s misapplication, unless such portion of the Property is replaced by an item of equal or greater value as determined by Lender in its reasonable discretion;
(e) the misapplication misappropriation or conversion of Rents received by Borrower or any affiliate thereof after the occurrence of (i) any insurance proceeds paid by reason of any loss, damage or destruction to the Property, (ii) any awards or other amounts received in connection with the condemnation of all or a portion of the Property, (iii) any Rents following an Event of Default Default; (v) Borrower’s misapplication, misappropriation or (iv) any conversion of tenant security deposits or Rents paid collected more than one one
(1) month in advance;
advance which are not delivered to Lender for application to the Loan; (fvi) the misapplication, misappropriation or conversion of insurance proceeds or condemnation awards; (vii) Personal Property (as defined in the Security Instrument) of the Borrower taken from the Property by or on behalf of Borrower or any of the Exculpated Parties and not replaced with Personal Property of the same utility and of the same or greater value; (viii) any act of arson by Borrower or any of the Exculpated Parties; (ix) any fees or commissions paid by Borrower after the occurrence of an Event of Default to any Exculpated Party in violation of the terms of this Note, the Security Instrument or the Other Security Documents; (x) failure to pay charges for labor or materials or taxes or other charges that can create liens superior to the lien of the Mortgage on any portion of the Property unless such taxes or other charges are being contested in accordance herewith or such taxes or charges have been delivered to Lender in accordance with Section 3.3 hereof or Borrower has complied with Section 5.2 hereofProperty; and
(gxi) any security deposits, advance deposits or any other deposits collected by Borrower or any affiliate thereof under leases with respect to the Property which are not being delivered to Lender upon a foreclosure of the Property or action in lieu thereof, except to the extent any such security deposits were applied in accordance with the terms and conditions of any of the applicable Leases (as defined in the Security Instrument) prior to the occurrence of the Event of Default that gave rise to such foreclosure or action in lieu thereof. ; (xii) any failure by Borrower to permit on-site inspections of the Property as required by the Security Instrument and/or the Other Security Documents; (xiii) any failure of Borrower to appoint a new property manager upon the request of Lender as required by the terms of the Security Instrument and/or the Other Security Documents; (xiv) Borrower’s material breach of, or failure to comply with, the representations, warranties and covenants contained in Articles 5.8(b), 5.19 and/or 12 of the Security Instrument; (xv) Borrower’s failure to provide financial information to Lender as required by Section 3.12 of the Security Instrument; and/or (xvi) any failure by Borrower to comply with any provisions of Section 4.2 (e), (f), (g), (i), (j), (k), (m), (n), (o), (p), (q), (r), (s), (t), (u), (v), (w), (x), (y), (z), (aa), (bb), (cc), (dd), (ee), (ff), (gg), (hh), or (ii) of the Security Instrument.
(c) Notwithstanding anything the foregoing, the agreement of Lender not to pursue recourse liability against Borrower as set forth in subsection (a) above as to Borrower SHALL BECOME NULL AND VOID and shall be of no further force and effect and the contrary Debt shall be fully recourse to Borrower in the event that: (1) the first full monthly payment of principal and interest under this Note is not paid when due; (ii) Borrower fails to comply with any provision of Section 4.2 (a), (b), (c), (d), (h) and (aa) of the Security Instrument; (iii) Borrower defaults under Article 8 of the Security Instrument; (iv) Borrower files a voluntary petition under the U.S. Bankruptcy Code or any other Federal or state bankruptcy or insolvency law; (v) an affiliate, officer, director or representative which controls Borrower, directly or indirectly, files, or joins in the filing of, an involuntary petition against Borrower under the U.S. Bankruptcy Code or any other Federal or state bankruptcy or insolvency law, or solicits or causes to be solicited petitioning creditors for any involuntary petition against Borrower from any person or entity; (vi) Borrower files an answer consenting to or otherwise acquiescing in or joining in any involuntary petition filed against it, by any other person or entity under the U.S. Bankruptcy Code or any other Federal or state bankruptcy or insolvency law, or solicits or causes to be solicited petitioning creditors for any involuntary petition from any person or entity; (vii) any affiliate, officer, director or representative which controls Borrower consents to or acquiesces in or joins in an application for the appointment of a custodian, receiver, trustee, or examiner for Borrower or any portion of the Loan Documents Property; or
(iviii) Lender Borrower makes an assignment for the benefit of creditors, or admits, in writing or in any legal proceeding, its insolvency or inability to pay its debts as they become due.
(d) Nothing herein shall not be deemed to have waived be a waiver of any right which Lender may have under Section 506(a), 506(b), 1111(b) or any other provisions provision of the U.S. Bankruptcy Code to file a claim for the full amount of the Debt indebtedness secured by the Security Instrument or to require that all collateral shall continue to secure all of the Debt indebtedness owing to Lender in accordance with this Note, the Loan Security Instrument and the Other Security Documents, and (ii) the Debt shall become fully recourse to Borrower (but not its members (other than Guarantor solely to the extent provided in the Non-Recourse Guaranty) or other direct or indirect constituent members or partners or any other Person) in the event that: (A) the first full Monthly Debt Service Payment Amount (as defined in the Note) under the Note is not paid when due; (B) other than in connection with a default under subsection (x) of the definition of Special Purpose Bankruptcy Remote Entity set forth in Schedule 5 hereto, Borrower fails to maintain its status as a Special Purpose Bankruptcy Remote Entity in accordance with the provisions of this Agreement and such failure results in the substantive consolidation of Borrower with another Person; (C) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any subordinate financing or other voluntary lien encumbering the Property; (D) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any assignment, transfer, or conveyance of the Property or any interest therein as and to the extent required by this Agreement or the Mortgage; or (E) (1) if any petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law, shall be filed by Borrower or Guarantor, or (2) if Borrower or Guarantor files an answer consenting to, or otherwise joining in, any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law filed against it by any other Person, or is found pursuant to a final, unappealable order of a court of competent jurisdiction to have solicited or caused to be solicited creditors to file any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law against Borrower or Guarantor, or (3) if Borrower or Guarantor are found, pursuant to a final unappealable order of a court of competent jurisdiction, to have been in collusion with creditors that initiate a bankruptcy action or proceeding against Borrower or Guarantor or (F) an Event of Default described in Section 8.1(s) hereof shall have occurred.
Appears in 1 contract
Samples: Promissory Note (AmREIT, Inc.)
Exculpation. Subject There shall be no limitation on the Borrower's personal liability under the Loan to the qualifications belowextent of $105,000,000, Lender which portion of the Loan shall be fully recourse against the assets of the Borrower (the "Recourse Liability"); provided however, such Recourse Liability shall not enforce be recourse to the assets of the members of the Borrower, and provided further that such Recourse Liability shall be reduced to the extent (i) one or more guaranties of payment of a portion of the Loan from individuals or entities which are direct or indirect members of the Borrower have been received by the Lenders and remain in full force and effect, and (ii) the amount of any reduction in the outstanding principal balance of the Loan. The Lenders agree to accept any such guaranties that are so delivered. Except for the Recourse Liability and any guaranties thereof, and except as provided below in this Section, the liability and obligation of the Borrower or its constituent members, partners, shareholders, directors, employees or agents or for the direct or indirect constituent members, partners, shareholders, directors, employees or agents thereof (collectively, the “Borrower Parties”) or any other Person, to perform and observe performance of the obligations contained in this Agreement, the Transaction Documents and the payment of the Note and any other fee, charge or any other amount which may become due in accordance with the provisions of the Note, this Agreement and the other Loan Transaction Documents shall not be enforced by any action or proceeding wherein a damages or any money judgment or any deficiency judgment or any judgment establishing any personal obligation or liability shall be sought against any of the Borrower Parties sought, collected or any other Person, except that Lender may bring a foreclosure action, an action for specific performance or any other appropriate action or proceeding to enable Lender to enforce and realize upon the Property, the Rents or any other collateral given to Lender pursuant to this Agreement and the other Loan Documents; provided, however, that, except as specifically provided herein, any judgment in any such action or proceeding shall be enforceable otherwise obtained against the Borrower Parties only to or against any past, present or future member, partner, officer, director or shareholder of 57 57 the extent of their interest in the Property, the Rents and in any other collateral given to LenderBorrower, and Lender, by accepting this Agreement, the Note each Lender and the other Loan Documents, agrees that it shall not sxx forAdministrative Agent for itself and its successors and assigns irrevocably waives any and all right to sue xxx, seek or demand any such damages, money judgment, deficiency judgment or personal judgment against the Borrower or against any past, present or future member, partner, officer, director or shareholder of the Borrower Parties or any other Person in any such action or proceeding under or by reason of or in connection with this Agreement, the Note Transaction Documents and agrees to look solely to the security and collateral held under or any in connection with the Transaction Documents for the enforcement of such liability and obligation of the other Loan DocumentsBorrower. The provisions of Nothing contained in this paragraph Section 9.16 shall not, however, be construed (i) constitute a waiver, release or impairment of any obligation evidenced or secured by this Agreement, as preventing the Note Administrative Agent or any of Lender from naming the other Loan Documents; (ii) impair the right of Lender to name Borrower or any past, present or future member, partner, officer, director or shareholder of the Borrower Parties, as a party defendant in any action or suit for foreclosure proceeding brought by the Administrative Agent or any Lender to enforce and sale to realize upon the security and collateral provided under or in connection with the Mortgage; Transaction Documents so long as no judgment, order, decree or other relief in the nature of a personal or deficiency judgment or otherwise establishing any personal obligation shall be asked for, taken, entered or enforced against the Borrower or against any past, present or future member, partner, officer, director or shareholder of the Borrower, in any such action or proceeding, except to the extent of the Recourse Liability as provided in the first sentence of this Section 9.16, (ii) as modifying, qualifying or affecting in any manner whatsoever the lien and security interests created by Mortgage and the other Transaction Documents or the enforcement thereof by the Administrative Agent or any Lender, (iii) affect as modifying, qualifying or affecting in any manner whatsoever the validity or enforceability personal recourse undertakings, obligations and liabilities of any person, party or entity under any guaranty made of payment, completion guaranty, other guaranty or indemnification agreement now or hereafter executed and delivered to the Administrative Agent in connection with the Transaction Documents or in connection with the Loan or any rights including, without limitation, the personal recourse obligations and remedies of Lender thereunder; (iv) impair the right of Lender to obtain the appointment of a receiver; (v) impair the enforcement liabilities of the Assignment of Leases and Rents; or (vi) constitute a waiver of Guarantor under the right of Lender to enforce the liability and obligation of Borrower (but not against any members of Borrower (other than Guarantor to the extent provided in the Non-Recourse Guaranty) or their direct or indirect constituent members or partners or any other Person), by money judgment or otherwise, to the extent of any loss, damage, cost, expense, liability, claim or other obligation (but excluding any punitive, consequential or speculative damages) incurred by Lender (including attorneys’ fees and costs reasonably incurred) arising out of or in connection with the following:
(a) fraud or intentional misrepresentation by Borrower or Guarantor in connection with the Loan;
(b) intentional physical waste of the Property (including, but not limited to, waste due to gross negligence) by Borrower or any affiliate thereof; provided, however, such physical waste shall exclude wear and tear to the Property that occurs in the ordinary course of business of the Property by Borrower or any affiliate thereof;
(c) the material breach of any representation, warranty, covenant or indemnification provision in the Environmental Indemnity or in this Agreement concerning Environmental Laws, Hazardous Substances and Asbestos;
(d) the removal or disposal by Borrower or any affiliate thereof of any portion of the Property after an Event of Default has occurred and while it is continuing, unless such portion of the Property is replaced by an item of equal or greater value as determined by Lender in its reasonable discretion;
(e) the misapplication or conversion by Borrower or any affiliate thereof of (i) any insurance proceeds paid by reason of any loss, damage or destruction to the Property, (ii) any awards or other amounts received in connection with the condemnation of all or a portion of the Property, (iii) any Rents following an Event of Default OP Guarantee or (iv) as modifying, qualifying or affecting in any Rents paid more than one (1) month in advance;
(f) failure to pay charges for labor or materials or taxes or other charges that can create liens superior to manner whatsoever the lien personal recourse liability of the Mortgage on any portion of the Property unless such taxes or other charges are being contested in accordance herewith or such taxes or charges have been delivered to Lender in accordance with Section 3.3 hereof or Borrower has complied with Section 5.2 hereof; and
(g) any security deposits collected by Borrower or any affiliate thereof with respect to the Property which are not delivered to Lender upon a foreclosure past, present or future member, partner, officer, director or shareholder of the Property or action in lieu thereof, except to the extent any such security deposits were applied in accordance with the terms and conditions of any of the Leases prior to the occurrence of the Event of Default that gave rise to such foreclosure or action in lieu thereof. Notwithstanding anything to the contrary in any of the Loan Documents (i) Lender shall not be deemed to have waived any right which Lender may have under Section 506(a), 506(b), 1111(b) Borrower or any other provisions person, party or entity for fraud, misappropriation of assets of Borrower or willful misrepresentation or any undertaking, obligation or liability under any Transaction Document which is specifically set forth therein as a personal recourse undertaking, liability or obligation of such Person (including, without limitation, the obligations of the U.S. Bankruptcy Code to file a claim for Borrower under Section 9.03(b)(iii) and the full amount of Borrower and the Debt or to require that all collateral shall continue to secure all of the Debt owing to Lender in accordance with the Loan Documents, and (ii) the Debt shall become fully recourse to Borrower (but not its members (other than Guarantor solely to the extent provided in the Non-Recourse Guaranty) or other direct or indirect constituent members or partners or any other Person) in the event that: (A) the first full Monthly Debt Service Payment Amount (as defined in the Note) under the Note is not paid when due; (B) other than in connection with a default under subsection (x) of the definition of Special Purpose Bankruptcy Remote Entity set forth in Schedule 5 hereto, Borrower fails to maintain its status as a Special Purpose Bankruptcy Remote Entity in accordance with the provisions of this Agreement and such failure results in the substantive consolidation of Borrower with another Person; (C) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any subordinate financing or other voluntary lien encumbering the Property; (D) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any assignment, transfer, or conveyance of the Property or any interest therein as and to the extent required by this Agreement or the Mortgage; or (E) (1) if any petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law, shall be filed by Borrower or Guarantor, or (2) if Borrower or Guarantor files an answer consenting to, or otherwise joining in, any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law filed against it by any other Person, or is found pursuant to a final, unappealable order of a court of competent jurisdiction to have solicited or caused to be solicited creditors to file any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law against Borrower or Guarantor, or (3) if Borrower or Guarantor are found, pursuant to a final unappealable order of a court of competent jurisdiction, to have been in collusion with creditors that initiate a bankruptcy action or proceeding against Borrower or Guarantor or (F) an Event of Default described in Section 8.1(s) hereof shall have occurred.9.03(f)). 58 58
Appears in 1 contract
Exculpation. Subject to In exercising its duties and powers under the qualifications belowTransaction Documents, Lender the Agent shall not enforce exercise the liability and obligation same care that it would exercise in dealing with loans for its own account, but neither the Agent nor any of Borrower or its constituent membersdirectors, partners, shareholders, directorsofficers, employees or agents attorneys shall be responsible for the truth or accuracy of any representations or warranties given or made herein or for the direct validity, effectiveness, sufficiency or indirect constituent membersenforceability of this Agreement, partnersor any other Transaction Documents, shareholdersand the Agent or any of its directors, directorsofficers, employees or agents thereof (collectively, attorneys shall not be liable to any of the “Borrower Parties”) Purchasers for any action taken or any other Person, omitted to perform and observe the obligations contained in this Agreement, the Note be taken by it or any of them under the other Loan Documents by any action or proceeding wherein a money judgment shall be sought against any of the Borrower Parties or any other PersonTransaction Documents, except in the case of its or their willful misconduct or gross negligence. The Purchaser represents and warrants to the Agent that Lender may bring a foreclosure action, an action for specific performance or any other appropriate action or proceeding it has made its own independent judgment with respect to enable Lender to enforce and realize upon the Property, the Rents or any other collateral given to Lender pursuant to entering into this Agreement and the other Loan Transaction Documents and undertaking its obligations hereunder and thereunder. The Purchaser also acknowledges that it will, independently and without reliance upon the Agent or any other Purchaser and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit decisions in taking or not taking action under this Agreement and the Transaction Documents; provided, however, that, except as specifically provided herein, any judgment in any such action or proceeding shall be enforceable against . The powers conferred by this Agreement on the Borrower Parties only Agent hereunder are solely to protect the extent of their Purchasers’ interest in the Property, the Rents and in any other collateral given to Lender, and Lender, by accepting this Agreement, the Note and the other Loan Documents, agrees that it shall not sxx for, seek or demand any deficiency judgment against any of the Borrower Parties or any other Person in any such action or proceeding under or by reason of or in connection with this Agreement, the Note or any of the other Loan Documents. The provisions of this paragraph shall not, however, (i) constitute a waiver, release or impairment of any obligation evidenced or secured by this Agreement, the Note or any of the other Loan Documents; (ii) impair the right of Lender to name any of the Borrower Parties, as a party defendant in any action or suit for foreclosure and sale under the Mortgage; (iii) affect the validity or enforceability of any guaranty made in connection with the Loan or any rights and remedies of Lender thereunder; (iv) impair the right of Lender to obtain the appointment of a receiver; (v) impair the enforcement of the Assignment of Leases and Rents; or (vi) constitute a waiver of the right of Lender to enforce the liability and obligation of Borrower (but not against any members of Borrower (other than Guarantor to the extent provided in the Non-Recourse Guaranty) or their direct or indirect constituent members or partners or any other Person), by money judgment or otherwise, to the extent of any loss, damage, cost, expense, liability, claim or other obligation (but excluding any punitive, consequential or speculative damages) incurred by Lender (including attorneys’ fees and costs reasonably incurred) arising out of or in connection with the following:
(a) fraud or intentional misrepresentation by Borrower or Guarantor in connection with the Loan;
(b) intentional physical waste of the Property (including, but not limited to, waste due to gross negligence) by Borrower or any affiliate thereof; provided, however, such physical waste shall exclude wear and tear to the Property that occurs in the ordinary course of business of the Property by Borrower or any affiliate thereof;
(c) the material breach of any representation, warranty, covenant or indemnification provision in the Environmental Indemnity or in this Agreement concerning Environmental Laws, Hazardous Substances and Asbestos;
(d) the removal or disposal by Borrower or any affiliate thereof of any portion of the Property after an Event of Default has occurred and while it is continuing, unless such portion of the Property is replaced by an item of equal or greater value as determined by Lender in its reasonable discretion;
(e) the misapplication or conversion by Borrower or any affiliate thereof of (i) any insurance proceeds paid by reason of any loss, damage or destruction to the Property, (ii) any awards or other amounts received in connection with the condemnation of all or a portion of the Property, (iii) any Rents following an Event of Default or (iv) any Rents paid more than one (1) month in advance;
(f) failure to pay charges for labor or materials or taxes or other charges that can create liens superior to the lien of the Mortgage on any portion of the Property unless such taxes or other charges are being contested in accordance herewith or such taxes or charges have been delivered to Lender in accordance with Section 3.3 hereof or Borrower has complied with Section 5.2 hereof; and
(g) any security deposits collected by Borrower or any affiliate thereof with respect to the Property which are not delivered to Lender upon a foreclosure of the Property or action in lieu thereof, except to the extent any such security deposits were applied in accordance with the terms and conditions of any of the Leases prior to the occurrence of the Event of Default that gave rise to such foreclosure or action in lieu thereof. Notwithstanding anything to the contrary in any of the Loan Documents (i) Lender shall not be deemed to have waived any right which Lender may have under Section 506(a), 506(b), 1111(b) or any other provisions of the U.S. Bankruptcy Code to file a claim for the full amount of the Debt or to require that all collateral shall continue to secure all of the Debt owing to Lender in accordance with the Loan Documents, and (ii) the Debt shall become fully recourse to Borrower (but not its members (other than Guarantor solely to the extent provided in the Non-Recourse Guaranty) or other direct or indirect constituent members or partners or any other Person) in the event that: (A) the first full Monthly Debt Service Payment Amount Collateral (as defined in the NoteSecurity Agreement) and shall not impose any duty upon the Agent to exercise any such powers. Except for the safe custody of any Collateral in its possession and the accounting for monies actually received by it under the Note is not paid when due; (B) other than in connection with a default under subsection (x) of Transaction Documents, the definition of Special Purpose Bankruptcy Remote Entity set forth in Schedule 5 hereto, Borrower fails Agent shall have no duty as to maintain its status any Collateral or as a Special Purpose Bankruptcy Remote Entity in accordance with the provisions of this Agreement and such failure results in the substantive consolidation of Borrower with another Person; (C) except as otherwise permitted pursuant to the Loan Documents, Borrower fails taking of any necessary steps to obtain Lender’s preserve rights against prior written consent to parties or any subordinate financing or other voluntary lien encumbering the Property; (D) except as otherwise permitted pursuant rights pertaining to the Loan DocumentsCollateral. Neither the Agent nor any of its directors, Borrower fails to obtain Lender’s prior written consent to officers, employees (excluding any assignment, transfer, independent contractors employed by the Agent) or conveyance of the Property or attorneys shall have any interest therein as and to the extent required by this Agreement or the Mortgage; or (E) responsibility (1) if to the Company on account of the failure or delay in performance or breach of any petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or Purchaser of any similar federal or state law, shall be filed by Borrower or Guarantorof its obligations under the Transaction Documents, or (2) if Borrower to any Purchaser on account of the failure of or Guarantor files an answer consenting to, delay in performance or otherwise joining in, any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law filed against it breach by any other Person, Lender or is found pursuant to a final, unappealable order the Debtors of a court any of competent jurisdiction to have solicited or caused to be solicited creditors to file any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law against Borrower or Guarantor, or (3) if Borrower or Guarantor are found, pursuant to a final unappealable order of a court of competent jurisdiction, to have been in collusion with creditors that initiate a bankruptcy action or proceeding against Borrower or Guarantor or (F) an Event of Default described in Section 8.1(s) hereof shall have occurredtheir obligations under the Transaction Documents.
Appears in 1 contract
Samples: Subordinated Convertible Debenture Purchase Agreement (Miscor Group, Ltd.)
Exculpation. Subject Notwithstanding any provision in this Agreement to the qualifications contrary (other than the proviso below), Lender it is agreed and understood that Purchaser shall not enforce look solely to the liability and obligation assets of Borrower Seller in the event of any breach or its constituent members, partners, shareholders, directors, employees or agents or the direct or indirect constituent members, partners, shareholders, directors, employees or agents thereof (collectively, the “Borrower Parties”) or any other Person, to perform and observe the obligations contained in default by Seller under this Agreement, and not to the Note assets of: (a) any person or entity which is a member, manager or partner in Seller, if Seller is a limited liability company or a partnership, or which otherwise owns or holds any ownership interest in Seller, directly or indirectly (each such partner or other holder or owner of the other Loan Documents by any action interest in Seller being referred to herein as a "Subtier Owner"); (b) any person or proceeding wherein entity which is a money judgment shall be sought against member, manager or partner in or otherwise owns or holds any of the Borrower Parties ownership interest in any Subtier Owner, whether directly or indirectly; (c) any other Personperson or entity serving as an officer, except that Lender may bring a foreclosure actiondirector, employee or otherwise for or in Seller; or (d) any person or entity serving as an action officer, director, employee or otherwise for specific performance or in any other appropriate action or proceeding to enable Lender to enforce and realize upon the Property, the Rents or any other collateral given to Lender pursuant to this Agreement and the other Loan DocumentsSubtier Owner; provided, however, thatthis provision does not limit the liability of Guarantor (as hereinafter defined) under Section 12.20 hereof or under the Master Lease Guaranty. This Agreement is executed by one or more persons (the "Signatories", except whether one or more) of Seller solely in their capacities as specifically provided herein, any judgment in any such action or proceeding shall be enforceable against the Borrower Parties only to the extent of their interest in the Property, the Rents and in any other collateral given to Lender, and Lender, by accepting this Agreement, the Note and the other Loan Documents, agrees that it shall not sxx for, seek or demand any deficiency judgment against any representatives of the Borrower Parties Seller or a Subtier Owner of Seller and not in their own individual capacities. Purchaser hereby releases and relinquishes the Signatories from any other Person in and all personal liability for any such action matters or proceeding claims of any kind which arise under or by reason of or in connection with or as a result of this Agreement, the Note or any of the other Loan Documents. The provisions foregoing release of this paragraph liability shall not, however, (i) constitute a waiver, release or impairment of any obligation evidenced or secured by this Agreement, the Note or any of the other Loan Documents; (ii) impair the right of Lender to name any of the Borrower Parties, as a party defendant in any action or suit for foreclosure and sale under the Mortgage; (iii) affect the validity or enforceability of any guaranty made in connection with the Loan or any rights and remedies of Lender thereunder; (iv) impair the right of Lender to obtain the appointment of a receiver; (v) impair the enforcement of the Assignment of Leases and Rents; or (vi) constitute a waiver of the right of Lender to enforce the liability and obligation of Borrower (but not against any members of Borrower (other than Guarantor to the extent provided in the Non-Recourse Guaranty) or their direct or indirect constituent members or partners or any other Person), by money judgment or otherwise, to the extent of any loss, damage, cost, expense, liability, claim or other obligation (but excluding any punitive, consequential or speculative damages) incurred by Lender (including attorneys’ fees and costs reasonably incurred) arising out of or in connection with the following:
(a) fraud or intentional misrepresentation by Borrower or Guarantor in connection with the Loan;
(b) intentional physical waste of the Property (including, but not limited to, waste due to gross negligence) by Borrower or any affiliate thereof; provided, however, such physical waste shall exclude wear and tear to the Property that occurs in the ordinary course of business of the Property by Borrower or any affiliate thereof;
(c) the material breach of any representation, warranty, covenant or indemnification provision in the Environmental Indemnity or in this Agreement concerning Environmental Laws, Hazardous Substances and Asbestos;
(d) the removal or disposal by Borrower or any affiliate thereof of any portion of the Property after an Event of Default has occurred and while it is continuing, unless such portion of the Property is replaced by an item of equal or greater value as determined by Lender in its reasonable discretion;
(e) the misapplication or conversion by Borrower or any affiliate thereof of (i) any insurance proceeds paid by reason of any loss, damage or destruction to the Property, (ii) any awards or other amounts received in connection with the condemnation of all or a portion of the Property, (iii) any Rents following an Event of Default or (iv) any Rents paid more than one (1) month in advance;
(f) failure to pay charges for labor or materials or taxes or other charges that can create liens superior to the lien of the Mortgage on any portion of the Property unless such taxes or other charges are being contested in accordance herewith or such taxes or charges have been delivered to Lender in accordance with Section 3.3 hereof or Borrower has complied with Section 5.2 hereof; and
(g) any security deposits collected by Borrower or any affiliate thereof be effective with respect to and shall apply to all claims against any members, managers and partners of Seller (if Seller is a limited liability company or a partnership) and any members, managers and partners of any Subtier Owner (if such Subtier Owner is a limited liability company or a partnership) regardless of whether such claims arise as a result of any liability which the Property which are not delivered to Lender upon a foreclosure Signatories may have as members, managers or partners of the Property Seller or action in lieu thereofany Subtier Owner, except or otherwise. Seller acknowledges that Seller’s obligations with respect to any covenant, indemnity, representation or warranty under this Agreement which expressly survives the extent any such security deposits were applied in accordance with the terms and conditions Closing shall be considered a liability for purposes of any of the Leases prior to the occurrence of the Event of Default that gave rise to such foreclosure or action in lieu thereof. Notwithstanding anything to the contrary in any of the Loan Documents (i) Lender shall not be deemed to have waived any right which Lender may have member distribution limitation imposed under Section 506(a), 506(b), 1111(b) or any other provisions of the U.S. Bankruptcy Code to file a claim for the full amount of the Debt or to require that all collateral shall continue to secure all of the Debt owing to Lender in accordance with the Loan Documents, and (ii) the Debt shall become fully recourse to Borrower (but not its members (other than Guarantor solely to the extent provided in the Non-Recourse Guaranty) or other direct or indirect constituent members or partners or any other Person) in the event that: (A) the first full Monthly Debt Service Payment Amount (as defined in the Note) under the Note is not paid when due; (B) other than in connection with a default under subsection (x) of the definition of Special Purpose Bankruptcy Remote Entity set forth in Schedule 5 hereto, Borrower fails to maintain its status as a Special Purpose Bankruptcy Remote Entity in accordance with the provisions of this Agreement and such failure results in the substantive consolidation of Borrower with another Person; (C) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any subordinate financing or other voluntary lien encumbering the Property; (D) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any assignment, transfer, or conveyance of the Property or any interest therein as and to the extent required by this Agreement or the Mortgage; or (E) (1) if any petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law, shall be filed by Borrower or Guarantor, or (2) if Borrower or Guarantor files an answer consenting to, or otherwise joining in, any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law filed against it by any other Person, or is found pursuant to a final, unappealable order of a court of competent jurisdiction to have solicited or caused to be solicited creditors to file any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law against Borrower or Guarantor, or (3) if Borrower or Guarantor are found, pursuant to a final unappealable order of a court of competent jurisdiction, to have been in collusion with creditors that initiate a bankruptcy action or proceeding against Borrower or Guarantor or (F) an Event of Default described in Section 8.1(s) hereof shall have occurredapplicable Texas limited liability laws.
Appears in 1 contract
Samples: Sale and Purchase Agreement (Stratus Properties Inc)
Exculpation. Subject to the qualifications below(a) Except as otherwise expressly provided in this Section 9.4, Lender shall not enforce the liability and obligation of Borrower or its constituent members, partners, shareholders, directors, employees or agents or the direct or indirect constituent members, partners, shareholders, directors, employees or agents thereof (collectively, the “Borrower Parties”) or any other Person, to perform and observe the obligations contained in this Agreement, the Note or the Pledge Agreement or any of the other Loan Documents Document by any action or proceeding wherein a money judgment shall be sought against any of the Borrower Parties or any other PersonExculpated Party, except that Lender may bring a foreclosure action, an action for specific performance or any other appropriate action or proceeding to enable Lender to enforce and realize upon the Propertythis Agreement, the Rents or Note, the Pledge Agreement, the other Loan Documents, and the Collateral and any other collateral given for the Debt in which a security interest is granted to Lender pursuant to by this Agreement, the Pledge Agreement and or the other Loan Documents; provided, however, that, except as specifically provided herein, that any judgment in any such action or proceeding shall be enforceable against the Borrower Parties only to the extent of their Borrower’s interest in the PropertyCollateral, the Rents and in any other collateral given in which a security interest is granted to LenderLender by this Agreement, and the Pledge Agreement or the other Loan Documents. Lender, by accepting this Agreement, the Note and the other Loan DocumentsPledge Agreement, agrees that it shall not sxx not, except as otherwise expressly provided in this Section 9.4, xxx for, seek or demand any deficiency or other money judgment against Borrower, any direct or indirect member, manager, shareholder, partner, beneficiary or other owner of beneficial ownership interests in Borrower, or any affiliate, director, officer, employee, trustee or agent of any of the Borrower Parties or any other Person foregoing (each, an “Exculpated Party” and, collectively, the “Exculpated Parties”) in any such action or proceeding proceeding, under or by reason of or under or in connection with this Agreement, the Note Note, the Pledge Agreement or any of the other Loan Documents. The provisions of this paragraph Section shall not, however, (i) constitute a waiver, release or impairment of any obligation evidenced or secured by this Agreement, the Note Note, the Pledge Agreement or any of the other Loan Documents; (ii) impair the right of Lender to name any of the Borrower Parties, as a party defendant in any action or suit for judicial foreclosure and sale under the MortgagePledge Agreement (subject, however, to the aforesaid limitation on Lender’s right to xxx, seek or demand a deficiency or other money judgment against Borrower or any other Exculpated Party); (iii) affect the validity or enforceability of any guaranty indemnity (including, without limitation, the Environmental Indemnity), guaranty, master lease or similar instrument made in connection with this Agreement, the Note, the Pledge Agreement, or the other Loan Documents (subject, however, to any exculpatory or any rights and remedies of Lender thereundernon-recourse provisions appearing in such indemnity, guaranty or similar instrument); (iv) impair the right of Lender to obtain the appointment of a receiver; (v) impair the enforcement of the Assignment of Leases and Rents[intentionally omitted]; or (vi) constitute a waiver of impair the right of Lender to enforce the liability provisions of Sections 4.1.8, 4.1.28, 5.1.9 and obligation 5.2.8 hereof (subject, however, to the aforesaid limitation on Lender’s right to xxx, seek or demand a deficiency or other money judgment against Borrower or any other Exculpated Party which such limitation, with respect to Borrower, shall not apply to the Environmental Indemnity); or (vii) impair the right of Lender to obtain a deficiency judgment or other judgment on the Note against Borrower (but not against any members of Borrower (other than Guarantor if and to the extent necessary to obtain any insurance proceeds or condemnation awards to which Lender would otherwise be entitled under this Agreement; provided in the Non-Recourse Guaranty) or their direct or indirect constituent members or partners or any other Person)however, by money that Lender shall only be entitled to enforce such judgment or otherwise, to the extent of any lossthe insurance proceeds and/or condemnation awards.
(b) Notwithstanding the provisions of this Section 9.4 to the contrary, damage, cost, expense, liability, claim or other obligation Borrower and Guarantor pursuant to the Guaranty (but excluding not any punitiveother Exculpated Parties) shall be personally liable to Lender for any actual Losses Lender incurs due to the following (collectively, consequential or speculative damages) incurred by Lender (including attorneys’ fees and costs reasonably incurred) arising out of or in connection with the following:“Recourse Events”):
(ai) any fraud or intentional misrepresentation committed by Borrower, Mezzanine A Borrower, Mortgage Borrower or Guarantor by any of their Affiliates or agents in connection with the Loan, the Mezzanine A Loan or Mortgage Loan;
(bii) any intentional and material misrepresentation by Borrower, Mezzanine A Borrower or Mortgage Borrower in any of the Loan Documents, the Mezzanine A Loan Documents or the Mortgage Loan Documents;
(iii) the misappropriation by Borrower, Mezzanine A Borrower, Mortgage Borrower or any of their Affiliates or agents of any funds (including misappropriation of Rents, security deposits and/or Net Proceeds);
(iv) any Transfer, Sale or Pledge of the Property, the Collateral, the Mezzanine A Collateral or any interest of a Restricted Party therein, and in each case, which is prohibited hereunder;
(v) the intentional and material breach of any representation in the Environmental Indemnity or in Sections 4.1.39 or 5.1.19 hereof;
(vi) any voluntary filing by Borrower, Mezzanine A Borrower, Mezzanine A Principal, Mortgage Borrower, Mortgage Principal or Principal under the Bankruptcy Code or any other federal or state bankruptcy or insolvency law;
(vii) any involuntary filing against Borrower, Mezzanine A Borrower, Mezzanine A Principal, Mortgage Borrower, Mortgage Principal or Principal under the Bankruptcy Code or any other federal or state bankruptcy or insolvency law by any Person acting at the request or under the direction of Borrower, Mezzanine A Borrower, Mortgage Borrower or any of their Affiliates or agents;
(viii) Mezzanine A Borrower, Mezzanine A Principal, Mortgage Borrower, Mortgage Principal, Borrower or Principal consents to or acquiesces in or joins in an application for the appointment of a custodian, receiver, trustee or examiner for Mezzanine A Borrower, Mezzanine A Principal, Mortgage Borrower, Mortgage Principal, Borrower or Principal or any portion of the Property, the Mezzanine A Collateral or the Collateral;
(ix) Borrower’s making a distribution to its equity owners after the occurrence and during the continuance of an Event of Default;
(x) Mezzanine A Borrower, Mezzanine A Principal, Mortgage Borrower, Mortgage Principal, Borrower or Principal makes an assignment for the benefit of creditors; or
(xi) any intentional physical waste of the Property (includingor the Mezzanine A Collateral by Mezzanine A Borrower, but not limited toMezzanine A Principal, waste due to gross negligence) by Mortgage Borrower, Mortgage Principal, Borrower or any affiliate thereof; provided, however, such physical waste shall exclude wear and tear to the Property that occurs in the ordinary course of business of the Property by Borrower Principal or any affiliate thereof;
(c) the material breach of any representation, warranty, covenant their Affiliates or indemnification provision in the Environmental Indemnity or in this Agreement concerning Environmental Laws, Hazardous Substances and Asbestos;
(d) the removal or disposal by Borrower or any affiliate thereof of any portion of the Property after an Event of Default has occurred and while it is continuing, unless such portion of the Property is replaced by an item of equal or greater value as determined by Lender in its reasonable discretion;
(e) the misapplication or conversion by Borrower or any affiliate thereof of (i) any insurance proceeds paid by reason of any loss, damage or destruction to the Property, (ii) any awards or other amounts received in connection with the condemnation of all or a portion of the Property, (iii) any Rents following an Event of Default or (iv) any Rents paid more than one (1) month in advance;
(f) failure to pay charges for labor or materials or taxes or other charges that can create liens superior to the lien of the Mortgage on any portion of the Property unless such taxes or other charges are being contested in accordance herewith or such taxes or charges have been delivered to Lender in accordance with Section 3.3 hereof or Borrower has complied with Section 5.2 hereof; and
(g) any security deposits collected by Borrower or any affiliate thereof with respect to the Property which are not delivered to Lender upon a foreclosure of the Property or action in lieu thereof, except to the extent any such security deposits were applied in accordance with the terms and conditions of any of the Leases prior to the occurrence of the Event of Default that gave rise to such foreclosure or action in lieu thereof. Notwithstanding anything to the contrary in any of the Loan Documents (i) Lender shall not be deemed to have waived any right which Lender may have under Section 506(a), 506(b), 1111(b) or any other provisions of the U.S. Bankruptcy Code to file a claim for the full amount of the Debt or to require that all collateral shall continue to secure all of the Debt owing to Lender in accordance with the Loan Documents, and (ii) the Debt shall become fully recourse to Borrower (but not its members (other than Guarantor solely to the extent provided in the Non-Recourse Guaranty) or other direct or indirect constituent members or partners or any other Person) in the event that: (A) the first full Monthly Debt Service Payment Amount (as defined in the Note) under the Note is not paid when due; (B) other than in connection with a default under subsection (x) of the definition of Special Purpose Bankruptcy Remote Entity set forth in Schedule 5 hereto, Borrower fails to maintain its status as a Special Purpose Bankruptcy Remote Entity in accordance with the provisions of this Agreement and such failure results in the substantive consolidation of Borrower with another Person; (C) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any subordinate financing or other voluntary lien encumbering the Property; (D) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any assignment, transfer, or conveyance of the Property or any interest therein as and to the extent required by this Agreement or the Mortgage; or (E) (1) if any petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law, shall be filed by Borrower or Guarantor, or (2) if Borrower or Guarantor files an answer consenting to, or otherwise joining in, any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law filed against it by any other Person, or is found pursuant to a final, unappealable order of a court of competent jurisdiction to have solicited or caused to be solicited creditors to file any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law against Borrower or Guarantor, or (3) if Borrower or Guarantor are found, pursuant to a final unappealable order of a court of competent jurisdiction, to have been in collusion with creditors that initiate a bankruptcy action or proceeding against Borrower or Guarantor or (F) an Event of Default described in Section 8.1(s) hereof shall have occurredagents.
Appears in 1 contract
Samples: Mezzanine Loan Agreement (Archstone Smith Operating Trust)
Exculpation. Subject to Except as otherwise provided herein or in the qualifications belowother Loan Documents, Lender shall not enforce the liability and obligation of Borrower or its constituent members, partners, shareholders, directors, employees or agents or the direct or indirect constituent members, partners, shareholders, directors, employees or agents thereof (collectively, the “Borrower Parties”) or any other Person, to perform and observe the obligations contained herein or in this Agreement, the Note or any of the other Loan Documents by any action or proceeding wherein a money judgment shall be sought against (1) Borrower (except as set forth in this Section 15.1 and the Environmental Indemnity), (2) Guarantor (except as set forth in the Guaranty, the PIP Guaranty and the Environmental Indemnity), (3) any Affiliate of the Borrower, Mortgage Borrower, Mezzanine B Borrower Parties or Mezzanine A Borrower, (4) any Person owning, directly or indirectly, any legal or beneficial interest in Borrower or any other PersonAffiliate of Borrower or (5) any direct or indirect limited partner, member, principal, officer, beneficiary, trustee, advisor, employee, agent, shareholder, Affiliate or director of any Persons described in clauses (1) through (5) above (collectively, subject to the exceptions in clauses (i) and (ii) below, the “Exculpated Parties”), except that Lender may bring a foreclosure action, an action for specific performance or any other appropriate action or proceeding to enable Lender to enforce and realize upon the Propertythis Agreement, the Rents or Note, the Pledge Agreement and the other Loan Documents, and the interest in the Collateral and any other collateral given to Lender pursuant to created by this Agreement, the Note, the Pledge Agreement and the other Loan Documents; provided, however, that, except as specifically provided herein, that any judgment in any such action or proceeding shall be enforceable against the Borrower Parties Borrower, only to the extent of their Borrower’s interest in the Property, the Rents Collateral and in any other collateral given to Lender, and . Lender, by accepting this Agreement, the Note Note, the Pledge Agreement and the other Loan Documents, agrees that it shall not sxx not, except as otherwise provided in this Section 15.1, xxx for, seek or demand any deficiency judgment against any of the Borrower Parties or any other Person Exculpated Party in any such action or proceeding proceeding, under or by reason of or under or in connection with this Agreement, the Note Note, the Pledge Agreement or any of the other Loan Documents. The provisions of this paragraph Section 15.1 shall not, however, (i) constitute a waiver, release or impairment of any obligation evidenced or secured by this Agreement, the Note Note, the Pledge Agreement or any of the other Loan Documents; (ii) impair the right of Lender to name any of the Borrower Parties, or Additional Pledgor as a party defendant in any action or suit for foreclosure and sale under this Agreement and the MortgagePledge Agreement; (iii) affect the validity or enforceability of any guaranty indemnity (including, without limitation, those contained in Article 14 of this Agreement and the Environmental Indemnity), guaranty, master lease or similar instrument made in connection with this Agreement, the Note, the Pledge Agreement and the other Loan or any rights and remedies of Lender thereunderDocuments; (iv) impair the right of Lender to obtain the appointment of a receiver; (v) impair the enforcement of the Assignment of Leases and Rentsprovisions contained in the Pledge Agreement; or (vi) constitute a waiver of impair the right of Lender to enforce the liability and obligation of Borrower (but not against any members of Borrower (other than Guarantor to the extent provided in the Non-Recourse Guaranty) or their direct or indirect constituent members or partners or any other Person), by money obtain a deficiency judgment or otherwise, other judgment on the Note against Borrower if necessary to the extent of obtain any loss, damage, cost, expense, liability, claim or other obligation (but excluding any punitive, consequential or speculative damages) incurred by Net Liquidation Proceeds After Debt Service to which Lender (including attorneys’ fees and costs reasonably incurred) arising out of or in connection with the following:
(a) fraud or intentional misrepresentation by Borrower or Guarantor in connection with the Loan;
(b) intentional physical waste of the Property (including, but not limited to, waste due to gross negligence) by Borrower or any affiliate thereofwould otherwise be entitled under this Agreement; provided, however, Lender shall only enforce such physical waste shall exclude wear and tear to the Property that occurs in the ordinary course of business of the Property by Borrower or any affiliate thereof;
(c) the material breach of any representation, warranty, covenant or indemnification provision in the Environmental Indemnity or in this Agreement concerning Environmental Laws, Hazardous Substances and Asbestos;
(d) the removal or disposal by Borrower or any affiliate thereof of any portion of the Property after an Event of Default has occurred and while it is continuing, unless such portion of the Property is replaced by an item of equal or greater value as determined by Lender in its reasonable discretion;
(e) the misapplication or conversion by Borrower or any affiliate thereof of (i) any insurance proceeds paid by reason of any loss, damage or destruction to the Property, (ii) any awards or other amounts received in connection with the condemnation of all or a portion of the Property, (iii) any Rents following an Event of Default or (iv) any Rents paid more than one (1) month in advance;
(f) failure to pay charges for labor or materials or taxes or other charges that can create liens superior to the lien of the Mortgage on any portion of the Property unless such taxes or other charges are being contested in accordance herewith or such taxes or charges have been delivered to Lender in accordance with Section 3.3 hereof or Borrower has complied with Section 5.2 hereof; and
(g) any security deposits collected by Borrower or any affiliate thereof with respect to the Property which are not delivered to Lender upon a foreclosure of the Property or action in lieu thereof, except judgment to the extent any such security deposits were applied in accordance with the terms and conditions of any of the Leases prior to the occurrence of the Event of Default that gave rise to such foreclosure or action in lieu thereof. Notwithstanding anything to the contrary in any of the Loan Documents (i) Lender shall not be deemed to have waived any right which Lender may have under Section 506(a), 506(b), 1111(b) or any other provisions of the U.S. Bankruptcy Code to file a claim for the full amount of the Debt or to require that all collateral shall continue to secure all of the Debt owing to Lender in accordance with the Loan Documents, and (ii) the Debt shall become fully recourse to Borrower (but not its members (other than Guarantor solely to the extent provided in the Non-Recourse Guaranty) or other direct or indirect constituent members or partners or any other Person) in the event that: (A) the first full Monthly Debt Service Payment Amount (as defined in the Note) under the Note is not paid when due; (B) other than in connection with a default under subsection (x) of the definition of Special Purpose Bankruptcy Remote Entity set forth in Schedule 5 hereto, Borrower fails to maintain its status as a Special Purpose Bankruptcy Remote Entity in accordance with the provisions of this Agreement and such failure results in the substantive consolidation of Borrower with another Person; (C) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any subordinate financing or other voluntary lien encumbering the Property; (D) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any assignment, transfer, or conveyance of the Property or any interest therein as and to the extent required by this Agreement or the Mortgage; or (E) (1) if any petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law, shall be filed by Borrower or Guarantor, or (2) if Borrower or Guarantor files an answer consenting to, or otherwise joining in, any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law filed against it by any other Person, or is found pursuant to a final, unappealable order of a court of competent jurisdiction to have solicited or caused to be solicited creditors to file any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law against Borrower or Guarantor, or (3) if Borrower or Guarantor are found, pursuant to a final unappealable order of a court of competent jurisdiction, to have been in collusion with creditors that initiate a bankruptcy action or proceeding against Borrower or Guarantor or (F) an Event of Default described in Section 8.1(s) hereof shall have occurredInsurance Proceeds and/or Awards.
Appears in 1 contract
Samples: Mezzanine Loan Agreement (Ashford Hospitality Trust Inc)
Exculpation. Subject Except as otherwise set forth in this Section 8.14 and Section 4.2 to the qualifications belowcontrary, Lender shall not enforce the liability and obligation of any Borrower or its constituent members, partners, shareholders, directors, employees or agents or the direct or indirect constituent members, partners, shareholders, directors, employees or agents thereof (collectively, the “Borrower Parties”) or any other Person, Operating Lessee to perform and observe the obligations contained in this Agreement, the Note Note, any Mortgage or any of the other Loan Documents executed and delivered by any action Borrower or proceeding wherein a money judgment shall be sought against any of the Borrower Parties or any other Person, Operating Lessee except that Lender may pursue any power of sale, bring a foreclosure action, an action for specific performance performance, action for money judgment, or any other appropriate action or proceeding (including, without limitation, to enable obtain a deficiency judgment) against any or all Borrowers, or Operating Lessee or any other Person solely for the purpose of enabling Lender to enforce and realize upon (a) any Collateral, and (b) any Rents to the Propertyextent (x) received by any Borrower or any Manager (or any of their affiliates), after the occurrence of an Event of Default or (y) distributed to any Borrower, Operating Lessee or any Manager, or their respective shareholders, or partners or members, as applicable, or affiliates during or with respect to any period for which Lender did not receive the full amounts it was entitled to receive as prepayments of the Loan pursuant to Section 2.6(b) (all Rents or covered by clauses (x) and (y) being hereinafter referred to as the “Recourse Distributions”) and (c)) any other collateral given to Lender pursuant to this Agreement under the Loan Documents ((a), (b), and (c) collectively, the other Loan Documents“Default Collateral”); provided, however, that, except as specifically provided herein, that any judgment in any such action or proceeding shall be enforceable against the Borrower Parties only to the extent of their interest in any Default Collateral. The provisions of this Section 8.14 shall not, however, (a) impair the Property, validity of the Rents and Indebtedness evidenced by the Loan Documents or in any other collateral given to Lender, and Lender, by accepting this Agreement, way affect or impair the Note and the other Loan Documents, agrees that it shall not sxx for, seek or demand Liens of any deficiency judgment against any of the Borrower Parties or any other Person in any such action or proceeding under or by reason of or in connection with this Agreement, the Note Mortgage or any of the other Loan Documents. The provisions Documents or the right of this paragraph shall not, however, (i) constitute a waiver, release or impairment Lender to foreclose any Mortgage following an Event of any obligation evidenced or secured by this Agreement, the Note or any of the other Loan DocumentsDefault; (iib) impair the right of Lender to name any of the Borrower Parties, Person as a party defendant in any action or suit for judicial foreclosure and sale under the any Mortgage; (iiic) affect the validity or enforceability of the Note, any guaranty made in connection with Mortgage or the other Loan or any rights and remedies of Lender thereunderDocuments; (ivd) impair the right of Lender to obtain the appointment of a receiver; (ve) impair the enforcement of the Assignment of Leases and Rents; or (vi) constitute a waiver of the right of Lender to enforce the liability bring suit for and obligation of Borrower (but not recover against any members Person any damages, losses, expenses, liabilities or costs resulting from fraud, willful misrepresentation, waste of Borrower (other than Guarantor to the extent provided in the Non-Recourse Guaranty) or their direct or indirect constituent members or partners all or any other Person), by money judgment or otherwise, to the extent portion of any lossIndividual Property, damage, cost, expense, liability, claim or other obligation (but excluding wrongful removal or disposal of all or any punitive, consequential or speculative damages) incurred portion of any Individual Property by Lender (including attorneys’ fees and costs reasonably incurred) arising out of or any Person in connection with this Agreement, the following:
Note, any Mortgage or the other Loan Documents; (af) fraud impair the right of Lender to obtain the Recourse Distributions received by any Person; (g) impair the right of Lender to bring suit for and recover against any Person with respect to any misappropriation of security deposits or intentional misrepresentation by Borrower or Guarantor in connection with the Loan;
(b) intentional physical waste of the Property (including, but not limited to, waste due to gross negligence) by Borrower or any affiliate thereof; provided, however, such physical waste shall exclude wear and tear to the Property that occurs in the ordinary course of business of the Property by Borrower or any affiliate thereof;
(c) the material breach of any representation, warranty, covenant or indemnification provision in the Environmental Indemnity or in this Agreement concerning Environmental Laws, Hazardous Substances and Asbestos;
(d) the removal or disposal by Borrower or any affiliate thereof of any portion of the Property after an Event of Default has occurred and while it is continuing, unless such portion of the Property is replaced by an item of equal or greater value as determined by Lender in its reasonable discretion;
(e) the misapplication or conversion by Borrower or any affiliate thereof of (i) any insurance proceeds paid by reason of any loss, damage or destruction to the Property, (ii) any awards or other amounts received in connection with the condemnation of all or a portion of the Property, (iii) any Rents following an Event of Default or (iv) any Rents paid collected more than one (1) month in advance;
; (fh) failure impair the right of Lender to pay charges for labor obtain Insurance Proceeds or materials Condemnation Proceeds due to Lender pursuant to any Mortgage; (i) impair the right of Lender to enforce the provisions of Sections 4.1(V) or taxes 5.1(D) through 5.1(G), inclusive of this Agreement, Section 2.8 of each Mortgage or the Environmental Indemnity even after repayment in full by any Borrower of the Indebtedness; (j) prevent or in any way hinder Lender from exercising, or constitute a defense, or counterclaim, or other charges that can create liens superior to the lien basis for relief in respect of the Mortgage exercise of, an y other remedy against any or all of the Collateral securing the Note as provided in the Loan Documents; (k) impair the right of Lender to bring suit for and recover against any person with respect to any misapplication of any funds (including, without limitation, insurance proceeds and condemnation proceeds); (l) impair the right of Lender to xxx for, seek or demand a deficiency judgment against any Person solely for the purpose of foreclosing on any portion Collateral or any part thereof, or realizing upon the Default Collateral, or (m) impair the right of Lender to bring suit for and recover against any Person any damages, losses, expenses, liabilities or costs in the Property unless such taxes or other charges are being contested in accordance herewith or such taxes or charges have been delivered to Lender in accordance with Section 3.3 hereof or Borrower has complied with Section 5.2 hereof; and
(g) any security deposits collected by event that Borrower or any affiliate Operating Lessee shall take any action of any kind or nature whatsoever, either directly or indirectly to oppose, impede, obstruct, challenge, hinder, frustrate, enjoin or otherwise interfere with (A) Lender’s termination of any Operating Lease with any Operating Lessee, (B) Lender or the party acquiring any Individual Property following the occurrence of a foreclosure or deed in lieu thereof with respect (in full substitution of the applicable Operating Lessee) being deemed the “Owner” under the Management Agreement, (C) the execution, delivery or effectiveness of a new Management Agreement directly between Lender or the party acquiring any Individual Property following a foreclosure or deed in lieu thereof and applicable Manager or (D) any payment or other transfer by any Manager of funds which would otherwise be paid to the Property which are not delivered any Operating Lessee under any Operating Lease directly to Lender upon or the party acquiring any Individual Property following the occurrence of a foreclosure of the Property or action deed in lieu thereof, except in each case after or as a result of any automatic termination of the applicable Operating Lease or of Lender exercising its right to terminate the Operating Lease, in each case pursuant to the applicable Subordination, Attornment and Security Agreement and this Agreement, or shall, either directly or indirectly, cause or permit any other person to take any action which, if taken by such Operating Lessee would constitute an event described in this Section 8.14(m); provided, however, that any deficiency judgment referred to in this Section 8.14(m) shall be enforceable only to the extent any such security deposits were applied in accordance with the terms and conditions of any of the Leases prior Default Collateral. The preceding provisions of this Section 8.14 shall be inapplicable to the occurrence of the Event of Default that gave rise to such foreclosure or action in lieu thereof. Notwithstanding anything to the contrary in any of the Loan Documents Person if (i) Lender shall not be deemed to have waived any right which Lender may have under Section 506(a), 506(b), 1111(b) or any other provisions of the U.S. Bankruptcy Code to file a claim for the full amount of the Debt or to require that all collateral shall continue to secure all of the Debt owing to Lender in accordance with the Loan Documents, and (ii) the Debt shall become fully recourse to Borrower (but not its members (other than Guarantor solely to the extent provided in the Non-Recourse Guaranty) or other direct or indirect constituent members or partners or any other Person) in the event that: (A) the first full Monthly Debt Service Payment Amount (as defined in the Note) under the Note is not paid when due; (B) other than in connection with a default under subsection (x) of the definition of Special Purpose Bankruptcy Remote Entity set forth in Schedule 5 hereto, Borrower fails to maintain its status as a Special Purpose Bankruptcy Remote Entity in accordance with the provisions of this Agreement and such failure results in the substantive consolidation of Borrower with another Person; (C) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any subordinate financing or other voluntary lien encumbering the Property; (D) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any assignment, transfer, or conveyance of the Property or any interest therein as and to the extent required by this Agreement or the Mortgage; or (E) (1) if any petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law, law against any Borrower or Operating Lessee shall be filed by Borrower or Guarantorany Borrower, or (2) if Borrower or Guarantor files an answer consenting to, or otherwise joining in, any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy lawOperating Lessee, or any similar federal Affiliate of any Borrower or state law filed Operating Lessee, (ii) if an involuntary bankruptcy or other insolvency proceeding is commenced against it any Borrower or Operating Lessee (by a party other than Lender) but only if such Borrower has consented or acquiesced to such proceeding or if Borrower, Operating Lessee or any other PersonAffiliate of Borrower or Operating Lessee has acted in concert with, colluded or is found pursuant conspired with the party to cause the filing thereof or has consented to or acquiesced thereto, (iii) if any Borrower or Operating Lessee shall institute any proceeding for the dissolution or liquidation of any Borrower or Operating Lessee, (iv) if any Borrower or Operating Lessee shall make an assignment for the benefit of creditors, (v) if any Borrower or Operating Lessee shall breach any representation, warranty or covenant in Section 4.1(C) (such that such breach was considered by a final, unappealable order court as a factor in the court’s finding for a consolidation of the assets of a court Borrower or Operating Lessee with the assets of competent jurisdiction to have solicited another person or caused to entity or as a result thereof Lender suffers any material damage, cost, liability or expense; provided, however, that in the absence of an actual consolidation, recourse may be solicited creditors to file any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law had against Borrower or GuarantorOperating Lessee only to the extent of losses for such breach), or 4.1(V), 4.1(AA), 5.1(T) (3) if such that such breach was considered by a court as a factor in the court’s finding for a consolidation of the assets of a Borrower or Guarantor are foundOperating Lessee with the assets of another person or entity or as a result thereof Lender suffers any material damage, pursuant to a final unappealable order cost, liability or expense; provided, however, that in the absence of a court of competent jurisdictionan actual consolidation, to have been in collusion with creditors that initiate a bankruptcy action or proceeding recourse may be had against Borrower or Guarantor Operating Lessee only to the extent of losses for such breach) or 5.1(X), (v) if any Borrower or Operating Lessee allows any Transfer to occur in violation of Section 6.1(B) hereof or otherwise fails to obtain Lender’s prior written consent to any Transfer to the extent any consent is required in the Loan Documents, (vi) any Borrower or Operating Lessee interferes with Lender’s exercise of any of its rights or remedies hereunder or (Fvii) an Event of Default described if any Borrower or Operating Lessee breaches any representation or warranty contained in Section 8.1(s) hereof shall have occurred4.1(S).
Appears in 1 contract
Exculpation. Subject to the qualifications below(a) Except as otherwise provided herein, Lender shall not enforce the liability and obligation of Borrower or its constituent members, partners, shareholders, directors, employees or agents or the direct or indirect constituent members, partners, shareholders, directors, employees or agents thereof (collectively, the “Borrower Parties”) or any other Person, to perform and observe the representations warranties and obligations contained in the Note, this Agreement, the Note Security Instruments or any of the other Loan Documents by any action or proceeding wherein a money judgment shall be sought against any of the Borrower Parties or any other PersonBorrower, except that Lender may bring a foreclosure action, an action for specific performance or any other appropriate action or proceeding to enable Lender to enforce and realize upon its interest in the PropertyNote, this Agreement, the Rents or Security Instruments, the other Loan Documents, and the interest in the Properties, the Rents, the Collateral and any other collateral given to Lender pursuant to the Note, this Agreement and Agreement, the Security Instruments or the other Loan Documents; provided, however, that, except as specifically provided herein, that any judgment in any such action or proceeding shall be enforceable against the Borrower Parties only to the extent of their Borrower's interest in the PropertyProperties, in the Rent, the Rents Collateral and in any other collateral given to Lender. In no event shall any Related Party have any personal liability for the payment of the indebtedness or any other sums due hereunder, and Lender, by accepting this Agreementunder the Note, the Note and Security Instruments or the other Loan Documents, or for the performance or observance of any other obligation of Borrower other than pursuant to a written instrument executed by such Related Party specifically providing for such liability. Lender, by accepting the Note, this Agreement and the Security Instruments, agrees that it shall not sxx not, except as otherwise provided herein xxx for, seek or demand any deficiency judgment against Borrower and/or any of the Borrower Parties or any other Person Related Party in any such action or proceeding proceeding, under or by reason of or under or in connection with the Note, this Agreement, the Note or any of the other Loan DocumentsDocuments or the Security Instruments. The provisions of this paragraph Section shall not, however, (i) constitute a waiver, release or impairment of any obligation evidenced or secured by the Note, this Agreement, the Note or any of the other Loan DocumentsDocuments or the Security Instruments; (ii) impair the right of Lender to name any of the Borrower Parties, as a party defendant in any action or suit for judicial foreclosure and sale under the MortgageSecurity Instruments; (iii) affect the validity or enforceability of any guaranty indemnity (including, without limitation, the Environmental Indemnity), guaranty, master lease or similar instrument made in connection with the Note, this Agreement, the Security Instruments, or the other Loan or any rights and remedies of Lender thereunder; Documents, (iv) impair the right of Lender to obtain the appointment of a receiver; (v) impair the enforcement of the Assignment of Leases and RentsLeases; or (vi) constitute a waiver of impair the right of Lender to enforce the liability provisions of Sections 4.1.8, 4.1.29, 5.1.9 and obligation 5.2.8 of this Agreement; or (vii) impair the right of Lender to obtain a deficiency judgment or other judgment on the Note against Borrower (but not if necessary to preserve or enforce its rights and remedies against any members Collateral, including any insurance proceeds or condemnation awards to which Lender would otherwise be entitled under this Agreement or the Security Instruments; provided however, Lender shall only enforce such judgment against such Collateral, including the insurance proceeds and/or condemnation awards, as applicable.
(b) Notwithstanding the provisions of Borrower (other than Guarantor this Section 9.4 to the extent provided in contrary, Borrower shall be personally liable to Lender for the Non-Recourse Guaranty) or their direct or indirect constituent members or partners or any other Person)direct, by money judgment or otherwise, to the extent of any loss, damage, cost, expense, liability, claim or other obligation actual Losses it incurs due to: (but excluding any punitive, consequential or speculative damages) incurred by Lender (including attorneys’ fees and costs reasonably incurred) arising out of or in connection with the following:
(ai) fraud or intentional misrepresentation by any Borrower or Guarantor any other person or entity in connection with the Loan;
(b) intentional physical waste execution and the delivery of the Property (includingNote, but not limited tothis Agreement, waste due to gross negligence) by Borrower the Security Instruments or any affiliate thereofthe other Loan Documents; provided, however, such physical waste shall exclude wear and tear to the Property that occurs in the ordinary course of business of the Property by Borrower or any affiliate thereof;
(c) the material breach of any representation, warranty, covenant or indemnification provision in the Environmental Indemnity or in this Agreement concerning Environmental Laws, Hazardous Substances and Asbestos;
(d) the removal or disposal by Borrower or any affiliate thereof of any portion of the Property after an Event of Default has occurred and while it is continuing, unless such portion of the Property is replaced by an item of equal or greater value as determined by Lender in its reasonable discretion;
(e) the misapplication or conversion by Borrower or any affiliate thereof of (i) any insurance proceeds paid by reason of any loss, damage or destruction to the Property, (ii) any awards Borrower's intentional misapplication or other amounts misappropriation of Rents received in connection with by Borrower after the condemnation occurrence of all or a portion of the Property, (iii) any Rents following an Event of Default or (iv) any Rents paid more than one (1) month in advanceDefault;
(f) failure to pay charges for labor or materials or taxes or other charges that can create liens superior to the lien of the Mortgage on any portion of the Property unless such taxes or other charges are being contested in accordance herewith or such taxes or charges have been delivered to Lender in accordance with Section 3.3 hereof or Borrower has complied with Section 5.2 hereof; and
(g) any security deposits collected by Borrower or any affiliate thereof with respect to the Property which are not delivered to Lender upon a foreclosure of the Property or action in lieu thereof, except to the extent any such security deposits were applied in accordance with the terms and conditions of any of the Leases prior to the occurrence of the Event of Default that gave rise to such foreclosure or action in lieu thereof. Notwithstanding anything to the contrary in any of the Loan Documents (i) Lender shall not be deemed to have waived any right which Lender may have under Section 506(a), 506(b), 1111(b) or any other provisions of the U.S. Bankruptcy Code to file a claim for the full amount of the Debt or to require that all collateral shall continue to secure all of the Debt owing to Lender in accordance with the Loan Documents, and (ii) the Debt shall become fully recourse to Borrower (but not its members (other than Guarantor solely to the extent provided in the Non-Recourse Guaranty) or other direct or indirect constituent members or partners or any other Person) in the event that: (A) the first full Monthly Debt Service Payment Amount (as defined in the Note) under the Note is not paid when due; (B) other than in connection with a default under subsection (x) of the definition of Special Purpose Bankruptcy Remote Entity set forth in Schedule 5 hereto, Borrower fails to maintain its status as a Special Purpose Bankruptcy Remote Entity in accordance with the provisions of this Agreement and such failure results in the substantive consolidation of Borrower with another Person; (C) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any subordinate financing or other voluntary lien encumbering the Property; (D) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any assignment, transfer, or conveyance of the Property or any interest therein as and to the extent required by this Agreement or the Mortgage; or (E) (1) if any petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law, shall be filed by Borrower or Guarantor, or (2) if Borrower or Guarantor files an answer consenting to, or otherwise joining in, any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law filed against it by any other Person, or is found pursuant to a final, unappealable order of a court of competent jurisdiction to have solicited or caused to be solicited creditors to file any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law against Borrower or Guarantor, or (3) if Borrower or Guarantor are found, pursuant to a final unappealable order of a court of competent jurisdiction, to have been in collusion with creditors that initiate a bankruptcy action or proceeding against Borrower or Guarantor or (F) an Event of Default described in Section 8.1(s) hereof shall have occurred.
Appears in 1 contract
Exculpation. Subject to the qualifications below, Lender shall not enforce the liability and obligation of Borrower or its constituent members, partners, shareholders, directors, employees or agents or the direct or indirect constituent members, partners, shareholders, directors, employees or agents thereof (collectively, the “Borrower Parties”) or any other Person, to perform and observe the obligations contained in this Agreement, the Note or any of the other Loan Documents by any action or proceeding wherein a money judgment shall be sought against any of the Borrower Parties or any other PersonBorrower, except that Lender may bring a foreclosure action, an action for specific performance or any other appropriate action or proceeding to enable Lender to enforce and realize upon its interest and rights under the PropertyLoan Documents, the Rents or in all or any other collateral given to Lender pursuant to this Agreement and portion of the other Loan DocumentsCollateral; provided, however, that, except as specifically provided herein, any judgment in any such action or proceeding shall be enforceable against the Borrower Parties only to the extent of their Borrower’s interest in the Property, the Rents and in any other collateral given to LenderCollateral, and Lender, by accepting this Agreement, the Note and the other Loan Documents, agrees that it Lender shall not sxx xxx for, seek or demand any deficiency judgment against any of the Borrower Parties or any other Person in any such action or proceeding under or by reason of or under or in connection with this Agreement, the Note or any of the other Loan DocumentsDocument. The provisions of this paragraph Section shall not, however, (i) constitute a waiver, release or impairment of any obligation evidenced or secured by this Agreement, the Note or any of the other Loan DocumentsDocument; (ii) impair the right of Lender to name any of the Borrower Parties, as a party defendant in any action or suit for foreclosure and sale under any of the MortgageSecurity Documents; (iii) affect the validity or enforceability of any of the Loan Documents or any guaranty made in connection with the Loan or any of the rights and remedies of Lender thereunder; (iv) impair the right of Lender to obtain the appointment of a receiver; (v) impair constitute a prohibition against Lender to commence any other appropriate action or proceeding in order for Lender to fully realize the enforcement security granted by the Pledge or the other Security Documents or to exercise its remedies against all or any portion of the Assignment of Leases and RentsCollateral; or (vi) constitute a waiver of the right of Lender to enforce the liability and obligation of Borrower (but not against any members of Borrower (other than Guarantor to the extent provided in the Non-Recourse Guaranty) its constituent members, partners, officers, directors or their direct or indirect constituent members or partners or any other Personshareholders), by money judgment or otherwise, to the extent of any loss, damage, cost, expense, liability, claim or other obligation (but excluding any punitive, consequential or speculative damages) incurred by Lender (including attorneys’ fees and costs reasonably incurred) arising out of or in connection with the following:
following (all such liability and obligation of Borrower for any or all of the following being referred to herein as “Borrower’s Recourse Liabilities”): (a) fraud or intentional misrepresentation by Borrower Borrower, Sole Member, Owner or Guarantor in connection with obtaining the Loan;
; (b) intentional physical waste of the Property or any portion thereof, or after an Event of Default the removal or disposal of any portion of the Property; (includingc) any Proceeds paid by reason of any Insured Casualty or any Award received in connection with a Condemnation or other sums or payments attributable to the Property to the extent not applied in accordance with the provisions of the Loan Documents and the Senior Loan Documents (except to the extent that Borrower or Owner did not have the legal right, but because of a bankruptcy, receivership or similar judicial proceeding, to direct disbursement of such sums or payments); (d) all Rents of the Property received or collected by or on behalf of Borrower or Owner after an Event of Default and not limited toapplied to payment of Principal and interest due under the Note, waste and to the payment of actual and reasonable operating expenses of the Property, as they become due or payable (except to gross negligencethe extent that such application of such funds is prevented by bankruptcy, receivership, or similar judicial proceeding in which Borrower or Owner is legally prevented from directing the disbursement of such sums); (e) misappropriation (including failure to turn over to Lender on demand following an Event of Default) of tenant security deposits and rents collected in advance; (f) the failure by Borrower or any affiliate thereof; providedOwner to pay Taxes or Insurance Premiums, however, such physical waste provided Borrower shall exclude wear and tear not be liable to the Property that occurs extent funds to pay such amounts are available in the ordinary course Tax and Insurance Subaccount pursuant to the Senior Loan Agreement and Senior Lender failed to pay same; (g) the failure to pay transfer fees and charges due Lender under the Loan Documents in connection with any subordinate financing or any transfer of business all or any part of the Property by Borrower or the Collateral, or any affiliate thereof;
interest therein, from Borrower to Borrower’s transferee, or transfer of beneficial interest in Borrower; and (ch) the material breach of any representation, warranty, covenant or indemnification provision in the Environmental Indemnity or in this Agreement any Loan Document concerning Environmental LawsLaws or Hazardous Substances, Hazardous Substances including Sections 4.21 and Asbestos;
5.10, and clauses (dviii) the removal or disposal by Borrower or any affiliate thereof through (xi) of any portion of the Property after an Event of Default has occurred and while it is continuing, unless such portion of the Property is replaced by an item of equal or greater value as determined by Lender in its reasonable discretion;
(e) the misapplication or conversion by Borrower or any affiliate thereof of (i) any insurance proceeds paid by reason of any loss, damage or destruction to the Property, (ii) any awards or other amounts received in connection with the condemnation of all or a portion of the Property, (iii) any Rents following an Event of Default or (iv) any Rents paid more than one (1) month in advance;
(f) failure to pay charges for labor or materials or taxes or other charges that can create liens superior to the lien of the Mortgage on any portion of the Property unless such taxes or other charges are being contested in accordance herewith or such taxes or charges have been delivered to Lender in accordance with Section 3.3 hereof or Borrower has complied with Section 5.2 hereof; and
(g) any security deposits collected by Borrower or any affiliate thereof with respect to the Property which are not delivered to Lender upon a foreclosure of the Property or action in lieu thereof, except to the extent any such security deposits were applied in accordance with the terms and conditions of any of the Leases prior to the occurrence of the Event of Default that gave rise to such foreclosure or action in lieu thereof5.30. Notwithstanding anything to the contrary in this Agreement or any of the Loan Documents Documents, (ia) Lender shall not be deemed to have waived any right which Lender may have under Section 506(a)) , 506(b)) , 1111(b) or any other provisions of the U.S. Bankruptcy Code to file a claim for the full amount of the Debt or to require that all collateral shall continue to secure all of the Debt owing to Lender in accordance with the Loan Documents, and (iib) Lender’s agreement not to pursue personal liability of Borrower as set forth above SHALL BECOME NULL AND VOID and shall be of no further force and effect, and the Debt shall become be fully recourse to Borrower and Guarantor (but not its members (other than Guarantor solely to the extent provided in the Non-Recourse Guaranty) any of Borrower’s constituent members, partners, officers, directors or other direct or indirect constituent members or partners or any other Personshareholders) in the event that: (A) the first full Monthly Debt Service Payment Amount (as defined in the Note) under the Note is not paid when due; (B) other than in connection with a default under subsection (x) that one or more of the definition of Special Purpose Bankruptcy Remote Entity set forth in Schedule 5 heretofollowing occurs (each, Borrower fails to maintain its status as a Special Purpose Bankruptcy Remote Entity in accordance with the provisions of this Agreement and such failure results in the substantive consolidation of Borrower with another Person; “Springing Recourse Event”): (C) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any subordinate financing or other voluntary lien encumbering the Property; (D) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any assignment, transfer, or conveyance of the Property or any interest therein as and to the extent required by this Agreement or the Mortgage; or (E) (1) if any petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law, shall be filed by Borrower or Guarantor, or (2) if Borrower or Guarantor files an answer consenting to, or otherwise joining in, any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law filed against it by any other Person, or is found pursuant to a final, unappealable order of a court of competent jurisdiction to have solicited or caused to be solicited creditors to file any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law against Borrower or Guarantor, or (3) if Borrower or Guarantor are found, pursuant to a final unappealable order of a court of competent jurisdiction, to have been in collusion with creditors that initiate a bankruptcy action or proceeding against Borrower or Guarantor or (Fi) an Event of Default described in Section 8.1(s8.1(d) hereof shall have occurredoccurred (solely as a result of a voluntary Transfer) or (ii) a breach of the covenants set forth in Section 5.15, or (iii) Borrower’s voluntary commencement of proceedings to be adjudicated bankrupt or insolvent; Borrower’s consent to the institution of bankruptcy or insolvency proceedings against it; Borrower’s filing of a petition seeking, or consent to, reorganization or relief under any applicable federal or state law relating to bankruptcy or insolvency; Borrower’s consent to the appointment of a receiver, liquidator, assignee, trustee, sequestrator (or other similar official) of Borrower or a substantial part of Borrower’s property; Borrower’s assignment for the benefit of creditors; or the filing of an involuntary petition in bankruptcy or insolvency proceedings against Borrower by any principal of or owner of any interest in Borrower or any affiliate of or party related to Borrower (but excluding any owner or affiliate that indirectly owns or is affiliated with Borrower solely from its ownership of shares in the REIT).
Appears in 1 contract
Samples: Mezzanine Loan Agreement (KBS Real Estate Investment Trust, Inc.)
Exculpation. Subject Notwithstanding any provision to the qualifications below, Lender shall not enforce the liability and obligation of Borrower or its constituent members, partners, shareholders, directors, employees or agents or the direct or indirect constituent members, partners, shareholders, directors, employees or agents thereof (collectively, the “Borrower Parties”) or any other Person, to perform and observe the obligations contained contrary ----------- elsewhere in this Agreement, the Note or any of the other Loan Documents by any action or proceeding wherein a money judgment shall be sought against any of the Borrower Parties or any other Person, except that Lender may bring a foreclosure action, an action for specific performance or any other appropriate action or proceeding to enable Lender to enforce and realize upon the Property, the Rents or any other collateral given to Lender pursuant to this Agreement and the other Loan Documents; provided, however, that, except as specifically provided herein, any judgment in any such action or proceeding shall be enforceable against the Borrower Parties only to the extent of their interest in the Property, the Rents and in any other collateral given to Lender, and Lender, by accepting this Agreement, the Note and the other Loan Documents, agrees that it shall not sxx for, seek or demand any deficiency judgment against any of the Borrower Parties or any other Person in any such action or proceeding under or by reason of or in connection with this Agreement, the Note or any of the other Loan Documents. The provisions of this paragraph shall not, however, (i) constitute a waiver, release or impairment of any obligation evidenced or secured by this Agreement, the Note Agent shall not have any duties or responsibilities, except those expressly set forth herein, or any trust or fiduciary relationship with any Bank, and no implied covenants, functions, responsibilities, duties, obligations or liabilities shall be read into this Agreement or any other Loan Document or otherwise exist against the Agent. Neither the Agent nor any of its directors, officers, employees or agents (collectively, the "Related Parties") shall be liable to any --------------- Bank for any action taken or omitted to be taken by it under this Agreement or any other Loan Document, or in connection herewith or therewith, except for its own willful misconduct or gross negligence, nor shall the Agent or any of the Related Parties be responsible for any recitals or representations or warranties herein or therein, or for the effectiveness, enforceability, validity, or due execution of this Agreement or any other Loan Documents; (ii) impair Document, nor shall the right of Lender to name Agent or any of the Borrower PartiesRelated Parties be obligated to make any inquiry respecting the performance by the Principal Companies of their obligations hereunder or thereunder, as a party defendant in any action or suit for foreclosure and sale under to inspect the Mortgage; (iii) affect the validity Properties, books or enforceability of any guaranty made in connection with the Loan or any rights and remedies of Lender thereunder; (iv) impair the right of Lender to obtain the appointment of a receiver; (v) impair the enforcement records of the Assignment Principal Companies. The Agent shall be entitled to rely upon advice of Leases counsel concerning legal matters and Rents; upon any notice, consent, certificate, statement, or (vi) constitute writing which it believes to be genuine and to have been presented by a waiver proper Person. The Agent shall in all cases be fully protected in acting, or in refraining from acting, under this Agreement and the other Loan Documents in accordance with a request of the right of Lender to enforce the liability and obligation of Borrower Required Banks (but not against any members of Borrower (other than Guarantor to the extent provided in the Non-Recourse Guaranty) or their direct or indirect constituent members or partners or any other Person), by money judgment or otherwiseor, to the extent of this Agreement requires a higher percentage, such higher percentage), and such request and any loss, damage, cost, expense, liability, claim action taken or other obligation (but excluding any punitive, consequential or speculative damages) incurred by Lender (including attorneys’ fees failure to act pursuant thereto shall be binding upon all the Banks and costs reasonably incurred) arising out of or in connection with the following:
(a) fraud or intentional misrepresentation by Borrower or Guarantor in connection with the Loan;
(b) intentional physical waste all future holders of the Property (including, but not limited to, waste due Obligations. The Agent shall be fully justified in failing or refusing to gross negligence) by Borrower take any action under this Agreement or any affiliate thereof; provided, however, other Loan Document unless it shall first receive such physical waste shall exclude wear and tear to the Property that occurs in the ordinary course of business advice or concurrence of the Property by Borrower or any affiliate thereof;
Required Banks (c) the material breach of any representationor, warranty, covenant or indemnification provision in the Environmental Indemnity or in this Agreement concerning Environmental Laws, Hazardous Substances and Asbestos;
(d) the removal or disposal by Borrower or any affiliate thereof of any portion of the Property after an Event of Default has occurred and while it is continuing, unless such portion of the Property is replaced by an item of equal or greater value as determined by Lender in its reasonable discretion;
(e) the misapplication or conversion by Borrower or any affiliate thereof of (i) any insurance proceeds paid by reason of any loss, damage or destruction to the Property, (ii) any awards or other amounts received in connection with the condemnation of all or a portion of the Property, (iii) any Rents following an Event of Default or (iv) any Rents paid more than one (1) month in advance;
(f) failure to pay charges for labor or materials or taxes or other charges that can create liens superior to the lien of the Mortgage on any portion of the Property unless such taxes or other charges are being contested in accordance herewith or such taxes or charges have been delivered to Lender in accordance with Section 3.3 hereof or Borrower has complied with Section 5.2 hereof; and
(g) any security deposits collected by Borrower or any affiliate thereof with respect to the Property which are not delivered to Lender upon a foreclosure of the Property or action in lieu thereof, except to the extent any such security deposits were applied in accordance with the terms and conditions of any of the Leases prior to the occurrence of the Event of Default that gave rise to such foreclosure or action in lieu thereof. Notwithstanding anything to the contrary in any of the Loan Documents (i) Lender shall not be deemed to have waived any right which Lender may have under Section 506(a), 506(b), 1111(b) or any other provisions of the U.S. Bankruptcy Code to file a claim for the full amount of the Debt or to require that all collateral shall continue to secure all of the Debt owing to Lender in accordance with the Loan Documents, and (ii) the Debt shall become fully recourse to Borrower (but not its members (other than Guarantor solely to the extent provided in the Non-Recourse Guaranty) or other direct or indirect constituent members or partners or any other Person) in the event that: (A) the first full Monthly Debt Service Payment Amount (as defined in the Note) under the Note is not paid when due; (B) other than in connection with a default under subsection (x) of the definition of Special Purpose Bankruptcy Remote Entity set forth in Schedule 5 hereto, Borrower fails to maintain its status as a Special Purpose Bankruptcy Remote Entity in accordance with the provisions of this Agreement and requires a higher percentage, such failure results in the substantive consolidation of Borrower with another Person; (Chigher percentage) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any subordinate financing or other voluntary lien encumbering the Property; (D) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any assignment, transfer, or conveyance of the Property or any interest therein as and to the extent required by this Agreement or the Mortgage; or (E) (1) if any petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law, shall be filed by Borrower or Guarantor, or (2) if Borrower or Guarantor files an answer consenting to, or otherwise joining in, any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law filed against it by any other Person, or is found pursuant to a final, unappealable order of a court of competent jurisdiction to have solicited or caused to be solicited creditors to file any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law against Borrower or Guarantor, or (3) if Borrower or Guarantor are found, pursuant to a final unappealable order of a court of competent jurisdiction, to have been in collusion with creditors that initiate a bankruptcy action or proceeding against Borrower or Guarantor or (F) an Event of Default described in Section 8.1(s) hereof shall have occurreddeems appropriate.
Appears in 1 contract
Samples: Credit Agreement (View Tech Inc)
Exculpation. Subject Except as otherwise set forth in this Section 8.14 and Section 4.2 to the qualifications belowcontrary, Lender shall not enforce the liability and obligation of any Borrower or its constituent members, partners, shareholders, directors, employees or agents or the direct or indirect constituent members, partners, shareholders, directors, employees or agents thereof (collectively, the “Borrower Parties”) or any other Person, Operating Lessee to perform and observe the obligations contained in this Agreement, the Note Note, any Mortgage or any of the other Loan Documents executed and delivered by any action Borrower or proceeding wherein a money judgment shall be sought against any of the Borrower Parties or any other Person, Operating Lessee except that Lender may pursue any power of sale, bring a foreclosure action, an action for specific performance performance, action for money judgment, or any other appropriate action or proceeding (including, without limitation, to enable obtain a deficiency judgment) against any or all Borrowers, or Operating Lessee or any other Person solely for the purpose of enabling Lender to enforce and realize upon (a) any Collateral, and (b) any Rents to the Propertyextent (x) received by any Borrower or any Manager (or any of their affiliates), after the occurrence of an Event of Default or (y) distributed to any Borrower, Operating Lessee or any Manager, or their respective shareholders, or partners or members, as applicable, or affiliates during or with respect to any period for which Lender did not receive the full amounts it was entitled to receive as prepayments of the Loan pursuant to Section 2.6(b) (all Rents or covered by clauses (x) and (y) being hereinafter referred to as the “Recourse Distributions”) and (c)) any other collateral given to Lender pursuant to this Agreement under the Loan Documents ((a), (b), and (c) collectively, the other Loan Documents“Default Collateral”); provided, however, that, except as specifically provided herein, that any judgment in any such action or proceeding shall be enforceable against the Borrower Parties only to the extent of their interest in any Default Collateral. The provisions of this Section 8.14 shall not, however, (a) impair the Property, validity of the Rents and Indebtedness evidenced by the Loan Documents or in any other collateral given to Lender, and Lender, by accepting this Agreement, way affect or impair the Note and the other Loan Documents, agrees that it shall not sxx for, seek or demand Liens of any deficiency judgment against any of the Borrower Parties or any other Person in any such action or proceeding under or by reason of or in connection with this Agreement, the Note Mortgage or any of the other Loan Documents. The provisions Documents or the right of this paragraph shall not, however, (i) constitute a waiver, release or impairment Lender to foreclose any Mortgage following an Event of any obligation evidenced or secured by this Agreement, the Note or any of the other Loan DocumentsDefault; (iib) impair the right of Lender to name any of the Borrower Parties, Person as a party defendant in any action or suit for judicial foreclosure and sale under the any Mortgage; (iiic) affect the validity or enforceability of the Note, any guaranty made in connection with Mortgage or the other Loan or any rights and remedies of Lender thereunderDocuments; (ivd) impair the right of Lender to obtain the appointment of a receiver; (ve) impair the enforcement of the Assignment of Leases and Rents; or (vi) constitute a waiver of the right of Lender to enforce the liability bring suit for and obligation of Borrower (but not recover against any members Person any damages, losses, expenses, liabilities or costs resulting from fraud, willful misrepresentation, waste of Borrower (other than Guarantor to the extent provided in the Non-Recourse Guaranty) or their direct or indirect constituent members or partners all or any other Person), by money judgment or otherwise, to the extent portion of any lossIndividual Property, damage, cost, expense, liability, claim or other obligation (but excluding wrongful removal or disposal of all or any punitive, consequential or speculative damages) incurred portion of any Individual Property by Lender (including attorneys’ fees and costs reasonably incurred) arising out of or any Person in connection with this Agreement, the following:
Note, any Mortgage or the other Loan Documents; (af) fraud impair the right of Lender to obtain the Recourse Distributions received by any Person; (g) impair the right of Lender to bring suit for and recover against any Person with respect to any misappropriation of security deposits or intentional misrepresentation by Borrower or Guarantor in connection with the Loan;
(b) intentional physical waste of the Property (including, but not limited to, waste due to gross negligence) by Borrower or any affiliate thereof; provided, however, such physical waste shall exclude wear and tear to the Property that occurs in the ordinary course of business of the Property by Borrower or any affiliate thereof;
(c) the material breach of any representation, warranty, covenant or indemnification provision in the Environmental Indemnity or in this Agreement concerning Environmental Laws, Hazardous Substances and Asbestos;
(d) the removal or disposal by Borrower or any affiliate thereof of any portion of the Property after an Event of Default has occurred and while it is continuing, unless such portion of the Property is replaced by an item of equal or greater value as determined by Lender in its reasonable discretion;
(e) the misapplication or conversion by Borrower or any affiliate thereof of (i) any insurance proceeds paid by reason of any loss, damage or destruction to the Property, (ii) any awards or other amounts received in connection with the condemnation of all or a portion of the Property, (iii) any Rents following an Event of Default or (iv) any Rents paid collected more than one (1) month in advance;
; (fh) failure impair the right of Lender to pay charges for labor obtain Insurance Proceeds or materials Condemnation Proceeds due to Lender pursuant to any Mortgage; (i) impair the right of Lender to enforce the provisions of Sections 4.1(V) or taxes 5.1(D) through 5.1(G), inclusive of this Agreement, Section 2.8 of each Mortgage or the Environmental Indemnity even after repayment in full by any Borrower of the Indebtedness; (j) prevent or in any way hinder Lender from exercising, or constitute a defense, or counterclaim, or other charges that can create liens superior to the lien basis for relief in respect of the Mortgage exercise of, an y other remedy against any or all of the Collateral securing the Note as provided in the Loan Documents; (k) impair the right of Lender to bring suit for and recover against any person with respect to any misapplication of any funds (including, without limitation, insurance proceeds and condemnation proceeds); (l) impair the right of Lender to sxx for, seek or demand a deficiency judgment against any Person solely for the purpose of foreclosing on any portion Collateral or any part thereof, or realizing upon the Default Collateral, or (m) impair the right of Lender to bring suit for and recover against any Person any damages, losses, expenses, liabilities or costs in the Property unless such taxes or other charges are being contested in accordance herewith or such taxes or charges have been delivered to Lender in accordance with Section 3.3 hereof or Borrower has complied with Section 5.2 hereof; and
(g) any security deposits collected by event that Borrower or any affiliate Operating Lessee shall take any action of any kind or nature whatsoever, either directly or indirectly to oppose, impede, obstruct, challenge, hinder, frustrate, enjoin or otherwise interfere with (A) Lender’s termination of any Operating Lease with any Operating Lessee, (B) Lender or the party acquiring any Individual Property following the occurrence of a foreclosure or deed in lieu thereof with respect (in full substitution of the applicable Operating Lessee) being deemed the “Owner” under the Management Agreement, (C) the execution, delivery or effectiveness of a new Management Agreement directly between Lender or the party acquiring any Individual Property following a foreclosure or deed in lieu thereof and applicable Manager or (D) any payment or other transfer by any Manager of funds which would otherwise be paid to the Property which are not delivered any Operating Lessee under any Operating Lease directly to Lender upon or the party acquiring any Individual Property following the occurrence of a foreclosure of the Property or action deed in lieu thereof, except in each case after or as a result of any automatic termination of the applicable Operating Lease or of Lender exercising its right to terminate the Operating Lease, in each case pursuant to the applicable Subordination, Attornment and Security Agreement and this Agreement, or shall, either directly or indirectly, cause or permit any other person to take any action which, if taken by such Operating Lessee would constitute an event described in this Section 8.14(m); provided, however, that any deficiency judgment referred to in this Section 8.14(m) shall be enforceable only to the extent any such security deposits were applied in accordance with the terms and conditions of any of the Leases prior Default Collateral. The preceding provisions of this Section 8.14 shall be inapplicable to the occurrence of the Event of Default that gave rise to such foreclosure or action in lieu thereof. Notwithstanding anything to the contrary in any of the Loan Documents Person if (i) Lender shall not be deemed to have waived any right which Lender may have under Section 506(a), 506(b), 1111(b) or any other provisions of the U.S. Bankruptcy Code to file a claim for the full amount of the Debt or to require that all collateral shall continue to secure all of the Debt owing to Lender in accordance with the Loan Documents, and (ii) the Debt shall become fully recourse to Borrower (but not its members (other than Guarantor solely to the extent provided in the Non-Recourse Guaranty) or other direct or indirect constituent members or partners or any other Person) in the event that: (A) the first full Monthly Debt Service Payment Amount (as defined in the Note) under the Note is not paid when due; (B) other than in connection with a default under subsection (x) of the definition of Special Purpose Bankruptcy Remote Entity set forth in Schedule 5 hereto, Borrower fails to maintain its status as a Special Purpose Bankruptcy Remote Entity in accordance with the provisions of this Agreement and such failure results in the substantive consolidation of Borrower with another Person; (C) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any subordinate financing or other voluntary lien encumbering the Property; (D) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any assignment, transfer, or conveyance of the Property or any interest therein as and to the extent required by this Agreement or the Mortgage; or (E) (1) if any petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law, law against any Borrower or Operating Lessee shall be filed by Borrower or Guarantorany Borrower, or (2) if Borrower or Guarantor files an answer consenting to, or otherwise joining in, any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy lawOperating Lessee, or any similar federal Affiliate of any Borrower or state law filed Operating Lessee, (ii) if an involuntary bankruptcy or other insolvency proceeding is commenced against it any Borrower or Operating Lessee (by a party other than Lender) but only if such Borrower has consented or acquiesced to such proceeding or if Borrower, Operating Lessee or any other PersonAffiliate of Borrower or Operating Lessee has acted in concert with, colluded or is found pursuant conspired with the party to cause the filing thereof or has consented to or acquiesced thereto, (iii) if any Borrower or Operating Lessee shall institute any proceeding for the dissolution or liquidation of any Borrower or Operating Lessee, (iv) if any Borrower or Operating Lessee shall make an assignment for the benefit of creditors, (v) if any Borrower or Operating Lessee shall breach any representation, warranty or covenant in Section 4.1(C) (such that such breach was considered by a final, unappealable order court as a factor in the court’s finding for a consolidation of the assets of a court Borrower or Operating Lessee with the assets of competent jurisdiction to have solicited another person or caused to entity or as a result thereof Lender suffers any material damage, cost, liability or expense; provided, however, that in the absence of an actual consolidation, recourse may be solicited creditors to file any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law had against Borrower or GuarantorOperating Lessee only to the extent of losses for such breach), or 4.1(V), 4.1(AA), 5.1(T) (3) if such that such breach was considered by a court as a factor in the court’s finding for a consolidation of the assets of a Borrower or Guarantor are foundOperating Lessee with the assets of another person or entity or as a result thereof Lender suffers any material damage, pursuant to a final unappealable order cost, liability or expense; provided, however, that in the absence of a court of competent jurisdictionan actual consolidation, to have been in collusion with creditors that initiate a bankruptcy action or proceeding recourse may be had against Borrower or Guarantor Operating Lessee only to the extent of losses for such breach) or 5.1(X), (v) if any Borrower or Operating Lessee allows any Transfer to occur in violation of Section 6.1(B) hereof or otherwise fails to obtain Lender’s prior written consent to any Transfer to the extent any consent is required in the Loan Documents, (vi) any Borrower or Operating Lessee interferes with Lender’s exercise of any of its rights or remedies hereunder or (Fvii) an Event of Default described if any Borrower or Operating Lessee breaches any representation or warranty contained in Section 8.1(s) hereof shall have occurred4.1(S).
Appears in 1 contract
Exculpation. Subject to the qualifications below, Lender shall not enforce the liability and obligation of Borrower or its constituent members, partners, shareholders, directors, employees or agents or the direct or indirect constituent members, partners, shareholders, directors, employees or agents thereof (collectively, the “"Borrower Parties”") or any other Person, to perform and observe the obligations contained in this Agreement, the Note or any of the other Loan Documents by any action or proceeding wherein a money judgment shall be sought against any of the Borrower Parties or any other Person, except that Lender may bring a foreclosure action, an action for specific performance or any other appropriate action or proceeding to enable Lender to enforce and realize upon the Property, the Rents or any other collateral given to Lender pursuant to this Agreement and the other Loan Documents; provided, however, that, except as specifically provided herein, any judgment in any such action or proceeding shall be enforceable against the Borrower Parties only to the extent of their interest in the Property, the Rents and in any other collateral given to Lender, and Lender, by accepting this Agreement, the Note and the other Loan Documents, agrees that it shall not sxx xxx for, seek or demand any deficiency judgment against any of the Borrower Parties or any other Person in any such action or proceeding under or by reason of or in connection with this Agreement, the Note or any of the other Loan Documents. The provisions of this paragraph shall not, however, (i) constitute a waiver, release or impairment of any obligation evidenced or secured by this Agreement, the Note or any of the other Loan Documents; (ii) impair the right of Lender to name any of the Borrower Parties, as a party defendant in any action or suit for foreclosure and sale under the Mortgage; (iii) affect the validity or enforceability of any guaranty made in connection with the Loan or any rights and remedies of Lender thereunder; (iv) impair the right of Lender to obtain the appointment of a receiver; (v) impair the enforcement of the Assignment of Leases and RentsRents executed in connection herewith; or (vi) constitute a waiver of the right of Lender to enforce the liability and obligation of Borrower (but not against any members of Borrower (other than Guarantor to the extent provided in the Non-Recourse Guaranty) or their direct or indirect constituent members or partners or any other Person), by money judgment or otherwise, to the extent of any loss, damage, cost, ; expense, liability, claim or other obligation (but excluding any punitive, consequential or speculative damages) incurred by Lender (including attorneys’ ' fees and costs reasonably incurred) arising out of or in connection with the following:
(a) fraud or intentional misrepresentation by Borrower or any Guarantor in connection with the Loan;
(b) intentional physical waste of the Property (including, but not limited to, waste due to gross negligence) by Borrower or any affiliate thereof; , provided, however, such physical waste shall exclude wear and tear to the Property that occurs in the ordinary course of business of the Property by Borrower or any affiliate thereof;,
(c) the material breach of any representation, warranty, covenant or indemnification provision in the that certain Environmental Indemnity and Hazardous Substance Indemnification Agreement of even date herewith given by Borrower to Lender or in this Agreement concerning Environmental Laws, Hazardous Substances and Asbestos;
(d) the removal or disposal by Borrower or any affiliate thereof of any portion of the Property after an Event of Default has occurred and while it is continuing, unless such portion of the Property is replaced by an item of equal or greater value as determined by Lender in its reasonable discretion;
(e) the misapplication or conversion by Borrower or any affiliate thereof of of
(i) any insurance proceeds paid by reason of any loss, damage or destruction to the Property, ,
(ii) any awards or other amounts received in connection with the condemnation of all or a portion of the Property, (iii) any Rents following an Event of Default or (iv) any Rents paid more than one (1) month in advance;
(f) failure to pay charges for labor or materials or taxes or other charges that can create liens superior to the lien of the Mortgage on any portion of the Property unless such taxes or other charges are being contested in accordance herewith or such taxes or charges have been delivered to Lender in accordance with Section 3.3 hereof or Borrower has complied with Section 5.2 hereof5.2; and
(g) any security deposits collected by Borrower or any affiliate thereof with respect to the Property which are not delivered to Lender upon a foreclosure of the Property or action in lieu thereof, except to the extent any such security deposits were applied in accordance with the terms and conditions of any of the Leases prior to the occurrence of the Event of Default that gave rise to such foreclosure or action in lieu thereof. Notwithstanding anything to the contrary in any of the Loan Documents Documents
(i) Lender shall not be deemed to have waived any right which Lender may have under Section 506(a), 506(b), 1111(b) or any other provisions of the U.S. Bankruptcy Code to file a claim for the full amount of the Debt or to require that all collateral shall continue to secure all of the Debt owing to Lender in accordance with the Loan Documents, and (ii) the Debt shall become fully recourse to Borrower (but not its members (other than Guarantor solely to the extent provided in the Non-Recourse Guaranty) or other direct or indirect constituent members or partners or any other Person) in the event that: (A) the first full Monthly Debt Service Payment Amount (as defined in the Note) under the Note is not paid when due; (B) other than in connection with a default under subsection (x) of the definition of Special Purpose Bankruptcy Remote Entity set forth in Schedule 5 heretohereof, Borrower fails to maintain its status as a Special Purpose Bankruptcy Remote Entity in accordance with the provisions of this Agreement and such failure results in the substantive consolidation of Borrower with another Person; (C) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s 's prior written consent to any subordinate financing or other voluntary lien encumbering the Property; (D) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s 's prior written consent to any assignment, transfer, or conveyance of the Property or any interest therein as and to the extent required by this Agreement or the Mortgage; or (E) )
(1) a receiver (other than a receiver appointed by Lender), liquidator or trustee of Borrower or Guarantor shall be appointed which is not dismissed within ninety (90) days, or (2) if any petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law, shall be filed by Borrower or Guarantor, or (23) if Borrower or Guarantor files an answer consenting to, or otherwise joining in, any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law filed against it by any other Person, or is found pursuant to a final, unappealable order of a court of competent jurisdiction to have solicited or caused to be solicited creditors to file any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law against Borrower or Guarantor, or (34) if Borrower or Guarantor are found, pursuant to a final unappealable order of a court of competent jurisdiction, to have been in collusion with creditors that initiate a bankruptcy action or proceeding against Borrower or Guarantor or (F) an Event of Default described in Section 8.1(s) hereof shall have occurredGuarantor.
Appears in 1 contract
Exculpation. Subject (a) Notwithstanding any contrary provisions contained herein or in the Other Note, the Security Instrument or the Other Security Documents (other than a provision herein or therein which expressly states that it is intended to override any exculpatory provisions of this Note or the qualifications belowOther Note), Lender shall not enforce the liability and obligation of Borrower or its constituent members, partners, shareholders, directors, employees or agents or the direct or indirect constituent members, partners, shareholders, directors, employees or agents thereof (collectively, the “Borrower Parties”) or any other PersonBorrower, to perform and observe the obligations contained in this AgreementNote, the Note Other Note, the Security Instrument or any of the other Loan Other Security Documents by any action or proceeding wherein a money judgment shall be sought against any of the Borrower Parties or any other Personpartner or member of Borrower, except that Lender may bring a foreclosure actionaction (where no deficiency judgment is sought against Borrower or any partner or member of Borrower), an action for specific performance or any other appropriate action or proceeding to enable Lender to enforce and realize upon this Note, the Other Note, the Security Instrument, the Other Security Documents, and the interests in the Property, the Rents or ; and any other collateral given to Lender pursuant to this Agreement the Security Instrument and the other Loan Other Security Documents; provided, however, that, except as specifically provided herein, any judgment in any such action or proceeding shall not be enforceable against the Borrower Parties only (or any partner or member of Borrower) except to the extent of their Borrower’s interest in the Property, the Rents Property and in any other collateral given to LenderLender as security, and Lender, by accepting this AgreementNote, the Note Security Instrument and the other Loan Other Security Documents, agrees that it shall not sxx sue for, seek or demand any deficiency judgment against any of the Borrower Parties (or any other Person partner or member of Borrower) in any such action or proceeding proceeding, under or by reason of or in connection with this AgreementNote, the Note Other Note, the Security Instrument or any of the other Loan Other Security Documents. The provisions of this paragraph shall not, however, (i1) constitute a waiver, release or impairment of any obligation evidenced or secured by this AgreementNote, the Note Other Note, the Security Instrument or any of the other Loan Other Security Documents; (ii2) impair the right of Lender to name any of the Borrower Parties, as a party defendant in any action or suit for foreclosure and sale under the MortgageSecurity Instrument, where Lender is required to do so in order to properly pursue such action (and subject to the above-described prohibition on suing for, seeking or demanding any deficiency judgment); (iii3) affect the validity or enforceability of any guaranty or indemnity made in connection with this Note, the Loan Other Note, the Security Instrument or any rights and remedies of Lender thereunderthe Other Security Documents; (iv4) impair the right of Lender to obtain the appointment of a receiver; (v5) impair the enforcement of the Assignment of Leases and Rentsany assignment; or (vi6) constitute a waiver of the right of Lender to enforce the liability and obligation of Borrower (but not against any members of Borrower (other than Guarantor to the extent provided in the Non-Recourse Guaranty) or their direct or indirect constituent members or partners or any other Person)Borrower, by money judgment or otherwise, to the extent of any loss, damage, cost, expense, liability, claim or other obligation (but excluding any punitive, consequential or speculative damages) incurred losses suffered by Lender (including attorneys’ fees and costs reasonably incurred) arising out of or in connection with the following:
(ai) fraud or intentional misrepresentation by Borrower in connection with this Note, the Other Note, the Security Instrument or Guarantor the Other Security Documents;
(ii) any material inaccuracy, error or omission contained in the rent roll of the Property certified to by Borrower in that certain Xxxxxxxx’s Certification executed in connection with the Loan
(iii) the failure of Borrower or Sponsor to remedy (after thirty (30) days notice thereof from Lender referencing this provision) any failure to provide financial information when and as required by the Security Instrument;
(biv) intentional physical waste Willful Misconduct (as defined in the Indemnity Agreement) of Borrower in connection with Xxxxxxxx’s operation of the Property (including, but not limited to, waste due to gross negligence) by Borrower or any affiliate thereof; provided, however, such physical waste shall exclude wear and tear to the Property that occurs in the ordinary course of business of the Property by Borrower or any affiliate thereofProperty;
(cv) the material breach of any representation, warranty, covenant or indemnification provision in the Environmental Indemnity or provisions in this Agreement Note, the Other Note, the Security Instrument or the Other Security Documents concerning Environmental Laws, Laws and Hazardous Substances and Asbestosany indemnification of Lender with respect thereto in any document;
(dvi) the removal or disposal by Borrower or any affiliate thereof of any portion of the Property by Borrower after the occurrence and during the continuance of an Event of Default has occurred and while it is continuingunder this Note, unless such portion of the Property is replaced by an item of equal Other Note, the Security Instrument or greater value as determined by Lender in its reasonable discretionthe Other Security Documents;
(evii) the misapplication or conversion by Borrower or any affiliate thereof of (iA) any insurance proceeds paid by reason of any loss, damage or destruction to the Property, (iiB) any awards or other amounts received in connection with the condemnation of all or a portion of the Property, or (iiiC) any Rents following (other than as permitted by the Cash Management Agreement) after the occurrence and during the continuance of an Event of Default under this Note, the Other Note, the Security Instrument or (iv) any Rents paid more than one (1) month in advancethe Other Security Documents;
(f) failure to pay charges for labor or materials or taxes or other charges that can create liens superior to the lien of the Mortgage on any portion of the Property unless such taxes or other charges are being contested in accordance herewith or such taxes or charges have been delivered to Lender in accordance with Section 3.3 hereof or Borrower has complied with Section 5.2 hereof; and
(gviii) any security deposits collected by Borrower or any affiliate thereof with respect to the Property which are not delivered to Lender upon a foreclosure of the Property or action in lieu thereof, except to the extent any such security deposits were applied in accordance with the terms and conditions of any of the Leases prior to the occurrence of the Event of Default that gave rise to such foreclosure or action in lieu thereof. ;
(ix) the violation by Borrower of the representations or covenants contained in Section 4.3 of the Security Instrument;
(x) any matters set forth in Section 13.4 of the Security Instrument; or
(xi) Xxxxxxxx’s failure to making any required deposit to the Escrow Fund as required pursuant to the Security Instrument.
(b) Notwithstanding anything to the contrary in this Note, the Other Note, the Security Instrument or the Other Security Documents, the agreement of Lender not to pursue recourse liability as set forth in subsection (a) above SHALL BECOME NULL AND VOID and shall be of no further force and effect and the Debt shall be fully recourse to Borrower in the event that: (A) the first full Monthly Payment is not paid when due; (B) a Prohibited Transfer (as defined in the Security Instrument) occurs in violation of Article 8 of the Security Instrument; (C) Intentionally Omitted; or (D) if (I) an involuntary petition (other than the collusive involuntary petitions described in the following clause (II)) is filed against Borrower under the U.S. Bankruptcy Code or any other federal or state bankruptcy or insolvency law (collectively, the “Insolvency Laws”) and is not dismissed within ninety (90) days of the filing thereof, or (II) Borrower files or consents to the filing against Borrower of a petition, voluntary or involuntary, under applicable Insolvency Laws, or any partner, member or equivalent person of Borrower, or any person acting in concert with Borrower or any of the Loan Documents foregoing persons, files or joins in the filing against Borrower of an involuntary petition under applicable Insolvency Laws.
(ic) Lender Nothing herein shall not be deemed to have waived be a waiver of any right which Lender may have under Section 506(a), 506(b), 1111(b) or any other provisions of the U.S. Bankruptcy Code to file a claim for the full amount of the Debt or to require that all collateral shall continue to secure all of the Debt owing to Lender in accordance with this Note, the Loan Documents, and (ii) the Debt shall become fully recourse to Borrower (but not its members (other than Guarantor solely to the extent provided in the Non-Recourse Guaranty) or other direct or indirect constituent members or partners or any other Person) in the event that: (A) the first full Monthly Debt Service Payment Amount (as defined in the Note) under the Note is not paid when due; (B) other than in connection with a default under subsection (x) of the definition of Special Purpose Bankruptcy Remote Entity set forth in Schedule 5 hereto, Borrower fails to maintain its status as a Special Purpose Bankruptcy Remote Entity in accordance with the provisions of this Agreement and such failure results in the substantive consolidation of Borrower with another Person; (C) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any subordinate financing or other voluntary lien encumbering the Property; (D) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any assignment, transfer, or conveyance of the Property or any interest therein as and to the extent required by this Agreement Security Instrument or the Mortgage; or (E) (1) if any petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law, shall be filed by Borrower or Guarantor, or (2) if Borrower or Guarantor files an answer consenting to, or otherwise joining in, any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law filed against it by any other Person, or is found pursuant to a final, unappealable order of a court of competent jurisdiction to have solicited or caused to be solicited creditors to file any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law against Borrower or Guarantor, or (3) if Borrower or Guarantor are found, pursuant to a final unappealable order of a court of competent jurisdiction, to have been in collusion with creditors that initiate a bankruptcy action or proceeding against Borrower or Guarantor or (F) an Event of Default described in Section 8.1(s) hereof shall have occurredOther Security Documents.
Appears in 1 contract
Exculpation. Subject to the qualifications below, Lender The Administrative Agent shall not enforce the liability and obligation of Borrower have any duties or its constituent members, partners, shareholders, directors, employees or agents or the direct or indirect constituent members, partners, shareholders, directors, employees or agents thereof (collectively, the “Borrower Parties”) or any other Person, to perform and observe the obligations contained in this Agreement, the Note or any of the other Loan Documents by any action or proceeding wherein a money judgment shall be sought against any of the Borrower Parties or any other Personobligations, except that Lender may bring a foreclosure action, an action for specific performance or any other appropriate action or proceeding to enable Lender to enforce and realize upon the Property, the Rents or any other collateral given to Lender pursuant to this Agreement and the other Loan Documents; provided, however, that, except as specifically provided herein, any judgment in any such action or proceeding shall be enforceable against the Borrower Parties only to the extent of their interest in the Property, the Rents those expressly set forth herein and in any other collateral given to Lender, and Lender, by accepting this Agreement, the Note and the other Loan Documents, agrees that it and its duties hereunder shall be administrative in nature. Without limiting the generality of the foregoing, the Administrative Agent:
(a) shall not sxx forhave or be deemed to have any fiduciary relationship with any Lender or Issuing Bank or be subject to any fiduciary or other implied duties, seek regardless of whether a Default has occurred and is continuing, and no implied covenants, functions, responsibilities, duties, obligations or demand any deficiency judgment against any of the Borrower Parties liabilities shall be read into this Agreement or any other Loan Document or otherwise exist against the Administrative Agent;
(b) shall not have any duty to take any discretionary action or exercise any discretionary powers, except discretionary rights and powers expressly contemplated hereby or by the other Loan Documents that the Administrative Agent is required to exercise as directed in writing by the Required Lenders (or such other number or percentage of the Lenders as shall be, or as the Administrative Agent shall believe in good faith to be, expressly provided for herein or in the other Loan Documents), provided that the Administrative Agent shall not be required to take any action that, in its opinion or the opinion of its counsel, may expose the Administrative Agent to liability or that is contrary to any Loan Document or applicable law, including for the avoidance of doubt any action that may be in violation of the automatic stay under any applicable bankruptcy or insolvency proceeding or that may affect a forfeiture, modification or termination of property of a Defaulting Lender in violation of any applicable bankruptcy or insolvency law; and
(c) shall not, except as expressly set forth herein and in the other Loan Documents, have any duty to disclose, and shall not be liable for the failure to disclose, any information relating to the Borrower or any of its Affiliates that is communicated to or obtained by the Person serving as the Administrative Agent or any of its Affiliates in any capacity. The Administrative Agent and its Related Parties shall not be liable for any action taken or not taken by it (i) with the consent or at the request of the Required Lenders (or such action other number or proceeding percentage of the Lenders as shall be necessary, or as the Administrative Agent shall believe in good faith shall be necessary, under the circumstances as provided herein or in the other Loan Documents) or (ii) in the absence of its own gross negligence or willful misconduct (such absence to be preserved unless otherwise determined by reason a court of competent jurisdiction by final and nonappealable judgment). The Administrative Agent shall be deemed not to have knowledge of any Default unless and until written notice (stating that it is a “notice of default”) describing such Default is given to the Administrative Agent by the Borrower, a Lender or an Issuing Bank. The Administrative Agent shall not be responsible for or have any duty to ascertain or inquire into (i) any statement, warranty or representation made in or in connection with this Agreement, the Note or any of the other Loan Documents. The provisions of this paragraph shall not, however, (i) constitute a waiver, release or impairment of any obligation evidenced or secured by this Agreement, the Note or any of the other Loan Documents; (ii) impair the right of Lender to name any of the Borrower Parties, as a party defendant in any action or suit for foreclosure and sale under the Mortgage; (iii) affect the validity or enforceability of any guaranty made in connection with the Loan or any rights and remedies of Lender thereunder; (iv) impair the right of Lender to obtain the appointment of a receiver; (v) impair the enforcement of the Assignment of Leases and Rents; or (vi) constitute a waiver of the right of Lender to enforce the liability and obligation of Borrower (but not against any members of Borrower (other than Guarantor to the extent provided in the Non-Recourse Guaranty) or their direct or indirect constituent members or partners Agreement or any other Person), by money judgment or otherwise, to the extent of any loss, damage, cost, expense, liability, claim or other obligation (but excluding any punitive, consequential or speculative damages) incurred by Lender (including attorneys’ fees and costs reasonably incurred) arising out of or in connection with the following:
(a) fraud or intentional misrepresentation by Borrower or Guarantor in connection with the Loan;
(b) intentional physical waste of the Property (including, but not limited to, waste due to gross negligence) by Borrower or any affiliate thereof; provided, however, such physical waste shall exclude wear and tear to the Property that occurs in the ordinary course of business of the Property by Borrower or any affiliate thereof;
(c) the material breach of any representation, warranty, covenant or indemnification provision in the Environmental Indemnity or in this Agreement concerning Environmental Laws, Hazardous Substances and Asbestos;
(d) the removal or disposal by Borrower or any affiliate thereof of any portion of the Property after an Event of Default has occurred and while it is continuing, unless such portion of the Property is replaced by an item of equal or greater value as determined by Lender in its reasonable discretion;
(e) the misapplication or conversion by Borrower or any affiliate thereof of (i) any insurance proceeds paid by reason of any loss, damage or destruction to the PropertyLoan Document, (ii) the contents of any awards certificate, report or other amounts received document delivered hereunder or thereunder or in connection with the condemnation of all herewith or a portion of the Propertytherewith, (iii) any Rents following an Event of Default the performance or (iv) any Rents paid more than one (1) month in advance;
(f) failure to pay charges for labor or materials or taxes or other charges that can create liens superior to the lien of the Mortgage on any portion of the Property unless such taxes or other charges are being contested in accordance herewith or such taxes or charges have been delivered to Lender in accordance with Section 3.3 hereof or Borrower has complied with Section 5.2 hereof; and
(g) any security deposits collected by Borrower or any affiliate thereof with respect to the Property which are not delivered to Lender upon a foreclosure of the Property or action in lieu thereof, except to the extent any such security deposits were applied in accordance with the terms and conditions observance of any of the Leases prior to covenants, agreements or other terms or conditions set forth herein or therein or the occurrence of any Default, (iv) the Event sufficiency, validity, enforceability, effectiveness or genuineness of Default that gave rise to such foreclosure or action in lieu thereof. Notwithstanding anything to the contrary in this Agreement, any of the other Loan Documents (i) Lender shall not be deemed to have waived any right which Lender may have under Section 506(a), 506(b), 1111(b) Document or any other provisions of the U.S. Bankruptcy Code to file a claim for the full amount of the Debt agreement, instrument or to require that all collateral shall continue to secure all of the Debt owing to Lender in accordance with the Loan Documents, and document or (iiv) the Debt shall become fully recourse to Borrower (but not its members (other than Guarantor solely to the extent provided in the Non-Recourse Guaranty) or other direct or indirect constituent members or partners or satisfaction of any other Person) in the event that: (A) the first full Monthly Debt Service Payment Amount (as defined in the Note) under the Note is not paid when due; (B) other than in connection with a default under subsection (x) of the definition of Special Purpose Bankruptcy Remote Entity condition set forth in Schedule 5 heretoArticle V or elsewhere herein, Borrower fails other than to maintain its status as a Special Purpose Bankruptcy Remote Entity in accordance with the provisions confirm receipt of this Agreement and such failure results in the substantive consolidation of Borrower with another Person; (C) except as otherwise permitted pursuant items expressly required to be delivered to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any subordinate financing or other voluntary lien encumbering the Property; (D) except as otherwise permitted pursuant to the Loan Documents, Borrower fails to obtain Lender’s prior written consent to any assignment, transfer, or conveyance of the Property or any interest therein as and to the extent required by this Agreement or the Mortgage; or (E) (1) if any petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law, shall be filed by Borrower or Guarantor, or (2) if Borrower or Guarantor files an answer consenting to, or otherwise joining in, any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law filed against it by any other Person, or is found pursuant to a final, unappealable order of a court of competent jurisdiction to have solicited or caused to be solicited creditors to file any involuntary petition for bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or any similar federal or state law against Borrower or Guarantor, or (3) if Borrower or Guarantor are found, pursuant to a final unappealable order of a court of competent jurisdiction, to have been in collusion with creditors that initiate a bankruptcy action or proceeding against Borrower or Guarantor or (F) an Event of Default described in Section 8.1(s) hereof shall have occurredAdministrative Agent.
Appears in 1 contract
Samples: Third Amendment (Noble Energy Inc)
