Common use of Removal of Managing Member for Cause Clause in Contracts

Removal of Managing Member for Cause. KBS may, but shall not be obligated to, exercise any of the remedies provided in Section 2.06(c) and/or (d) below, as applicable, under any of the following circumstances (each a “Removal Event”): (i) if JV Member or any principal, officer, executive or employee of JV Member or any of its Affiliates has committed fraud adversely affecting the Company, any Subsidiary or the Project, or any portion thereof, or has embezzled Company funds or the funds of any Subsidiary or funds of the Project, or any portion thereof, provided that, in the case of embezzlement or fraud, if within ten (10) business days after such embezzlement or fraud is discovered by or disclosed to KBS, (x) such funds are replaced, and (y) if such embezzlement or fraud is committed by an individual other than a JV Member Principal, such individual is terminated, then such occurrence shall not be a Removal Event; for the avoidance of doubt, the commission of any act or conduct described in this clause (i) by JV Member shall constitute a Removal Event that is not subject to the foregoing ten (10) day cure period; (ii) if JV Member or any principal, officer, executive or employee of JV Member or any of its Affiliates has committed an intentional material misrepresentation or willful misconduct (other than an act or conduct described in clause (i) above) materially and adversely affecting the Company, any Subsidiary or the Project, or any portion thereof, which is not timely cured within thirty (30) days after written notice from KBS (or, if such default is not susceptible of cure within such thirty (30) day period, within such period as is required to effect such cure, so long as JV Member has commenced such cure within such thirty (30) day period and thereafter prosecutes such cure to completion with diligence), not to exceed sixty (60) additional days in the aggregate; (iii) if any JV Member Principal is convicted or pleads guilty or nolo contendere to (x) any felony that involves in any material respect the Company and/or any Subsidiary, and/or (y) any crime involving moral turpitude or breach of trust; (iv) the affairs of JV Member cease to be principally controlled by a JV Member Principal or other JV Member Key Person; (v) a default by JV Member as Managing Member under this Agreement materially adversely affecting the Company, any Subsidiary or the Project, or any portion thereof, which is not timely cured within thirty (30) days after written notice from KBS (or, if such default is not susceptible of cure within such thirty (30) day period, within such period as is required to effect such cure, not to exceed an additional thirty (30) days, so long as JV Member has commenced such cure within such thirty (30) day period and thereafter prosecutes such cure to completion with diligence), not to exceed sixty (60) additional days in the aggregate. Notwithstanding the foregoing, if the applicable material default is not susceptible of being cured but the actual damages caused by such material default can be quantified so that KBS and/or the Company or the applicable Subsidiary can be “made whole”, as reasonably determined by KBS in its good faith discretion, and the JV Member makes the necessary payment within thirty (30) days after KBS notifies JV Member of its determination of the necessary “make whole” payment then such payment shall be deemed to have cured such Removal Event; (vi) bankruptcy of the Company or any Subsidiary filed by the Managing Member without the written approval of KBS; (vii) bankruptcy of JV Member, or any JV Member Principal; (viii) if any default under any Financing, including any Required Guaranty (defined below) (for which there are no notice and cure rights or for which such rights have expired and the lender has not otherwise waived such default in accordance with the terms of any Financing document) occurs, the applicable lender elects to exercise remedies as a result of such default, which such default is caused by JV Member or any Affiliate thereof; provided that it shall not be a Removal Event if the event of default in question is a result of the Company or any Subsidiary having insufficient funds or revenues due to the performance of the Project or any other circumstance outside the control of JV Member; (ix) the failure of JV Member to fund any capital contributions as and when required pursuant to Section 3.01(a) or Section 3.06 below, as applicable and such failure is not cured within ten (10) days of written notice from KBS; (x) if any default continues past applicable notice and cure periods under the Hotel Management Agreement, which default would entitle Hotel Manager to terminate the Hotel Management Agreement, which such default is caused by JV Member or any Affiliate thereof; provided that it shall not be a Removal Event if the event of default in question is a result of the Company or any Subsidiary having insufficient funds or revenues due to the performance of the Project or any other circumstance outside the control of JV Member; (xi) if any default by Master Tenant continues past applicable notice and cure periods under the Franchise Agreement and Franchisor elects to exercise remedies as a result of such default, which such default is caused by JV Member or any Affiliate thereof; provided that it shall not be a Removal Event if the event of default in question is a result of the Company or any Subsidiary or the Master Tenant having insufficient funds or revenues due to the performance of the Project or any other circumstance outside the control of JV Member; (xii) the failure of JV Member to cause all liquor licenses with respect to the Project, or any portion thereof, to be maintained if such failure results in a notice of default from Lender or Franchisor and JV Member fails to use commercially reasonable efforts to reinstate or replace the applicable liquor license(s); provided that it shall not be a Removal Event if the same is a result of the Company having insufficient funds or revenues due to the performance of the Project or any other circumstance outside the control of JV Member; (xiii) if JV Member resigns as Managing Member without the prior written consent of KBS unless such action is taken by JV Member in response to an act or omission (or series of acts or omissions) by KBS which constitute a willful and material default by KBS hereunder adversely affecting the Company, any Subsidiary or the Project, or any portion thereof, which is not timely cured within thirty (30) days after written notice from JV Member (or, if such default is not susceptible of cure within such thirty (30) day period, within such period as is required to effect such cure, not to exceed an additional thirty (30) days, so long as KBS has commenced such cure within such thirty (30) day period and thereafter prosecutes such cure to completion with diligence), not to exceed sixty (60) additional days in the aggregate; (xiv) a breach by JV Member of any representation or warranty contained herein materially adversely affecting the Company, any Subsidiary or the Project, or any portion thereof, which is not timely cured within thirty (30) days after written notice from KBS (or, if such default is not susceptible of cure within such thirty (30) day period, within such period as is required to effect such cure so long as JV Member has commenced such cure within such thirty (30) day period and thereafter prosecutes such cure to completion with diligence), not to exceed sixty (60) additional days in the aggregate; provided, however, that if such breach was unintentional and the adverse effect on KBS of such material breach can be remedied, and JV Member promptly so remedies such adverse effect in all material respects, then such breach shall not be deemed a Removal Event. Notwithstanding the foregoing, if the applicable material breach is not susceptible of being cured but the actual damages caused by material breach can be quantified so that KBS and/or the Company or the applicable Subsidiary can be “made whole”, as reasonably determined by KBS in its good faith discretion, and the JV Member makes the necessary payment within thirty (30) days after KBS notifies JV Member of its determination of the necessary “make whole” payment then such payment shall be deemed to have cured such Removal Event; and (xv) a Removal Event occurs under the Limited Liability Company Agreement of Property Owner JV (as the same may from time to time be amended, supplemented, restated or otherwise modified, the “Property Owner JV LLC Agreement”).

Appears in 1 contract

Samples: Limited Liability Company Agreement (KBS Strategic Opportunity REIT II, Inc.)

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Removal of Managing Member for Cause. KBS Member may, but shall not be obligated to, exercise any of the remedies provided in Section 2.06(c) and/or (d) below, as applicable, below under any of the following circumstances (each each, a “Removal Event”): (i) if JV Member Member, or any principal, officer, executive or employee of JV Member engages in fraud, misappropriation of funds, intentional misrepresentation or any of its Affiliates has committed fraud adversely affecting willful misconduct with respect to the Company, any Subsidiary or the Project, or any portion thereof, or has embezzled Company funds or the funds of any Subsidiary or funds of the Project, or any portion thereof, provided that, in the case of embezzlement or fraud, if within ten (10) business days after such embezzlement or fraud is discovered by or disclosed to KBS, (x) such funds are replaced, and (y) if such embezzlement or fraud is committed by an individual other than a JV Member Principal, such individual is terminated, then such occurrence shall not be a Removal Event; for the avoidance of doubt, the commission of any act or conduct described in this clause (i) by JV Member shall constitute a Removal Event that is not subject to the foregoing ten (10) day cure period; (ii) if JV Member Member, or any principal, officer, executive or employee of JV Member is convicted or pleads guilty or nolo contendere to (1) any felony that involves the Company and/or any Subsidiary, and/or (2) any crime involving moral turpitude or breach of its Affiliates has committed an intentional trust; (iii) the affairs of JV Member cease to be principally controlled by a JV Member Principal; (iv) a material misrepresentation or willful misconduct (other than an act or conduct described in clause (i) above) materially and adversely affecting default by the Company, any Subsidiary or JV Member as the Project, or any portion thereof, Managing Member under this Agreement which is not timely cured within thirty ten (3010) business days after written notice from KBS Member (or, if such default is not susceptible of cure within such thirty ten (3010) business day period, within such period as is required to effect such cure, cure so long as JV Member has commenced such cure within such thirty ten (3010) business day period and thereafter prosecutes such cure to completion with diligence), not to exceed sixty ninety (6090) additional days in the aggregate; (iii) if any JV Member Principal is convicted or pleads guilty or nolo contendere to (x) any felony that involves in any material respect the Company and/or any Subsidiary, and/or (y) any crime involving moral turpitude or breach of trust; (iv) the affairs of JV Member cease to be principally controlled by a JV Member Principal or other JV Member Key Person; (v) a default by JV Member as Managing Member under this Agreement materially adversely affecting the Company, any Subsidiary or the Project, or any portion thereof, which is not timely cured within thirty (30) days after written notice from KBS (or, if such default is not susceptible of cure within such thirty (30) day period, within such period as is required to effect such cure, not to exceed an additional thirty (30) days, so long as JV Member has commenced such cure within such thirty (30) day period and thereafter prosecutes such cure to completion with diligence), not to exceed sixty (60) additional days in the aggregate. Notwithstanding the foregoing, if the applicable material default is not susceptible of being cured but the actual damages caused by such material default can be quantified so that KBS and/or the Company or the applicable Subsidiary can be “made whole”, as reasonably determined by KBS in its good faith discretion, and the JV Member makes the necessary payment within thirty (30) days after KBS notifies JV Member of its determination of the necessary “make whole” payment then such payment shall be deemed to have cured such Removal Event; (vi) bankruptcy Bankruptcy of the Company or any Subsidiary filed by the Managing Member without the written approval of KBSKBS Member; (viivi) bankruptcy Bankruptcy of JV Member, Member or any JV Member Principal;; SMRH:479102057.10 12 (viiivii) if any default under any Financing, including under any Required Guaranty (defined below) (for which there are no notice and cure rights or for which such rights have expired and the lender has not otherwise waived such default in accordance with the terms of any Financing document) occurs, the applicable lender elects to exercise remedies as a result of such default, which if such default is caused by JV Member or any Affiliate thereof; provided that it shall not be a Removal Event if the event of default in question is a result of the Company or any Subsidiary having insufficient funds or revenues due to the performance of the Project or if the default was caused by KBS Member or any other circumstance outside the control of JV MemberAffiliate thereof; (ixviii) the failure of JV Member to fund any capital contributions as and when required pursuant to Section 3.01(a) or Section 3.06 below, as applicable applicable, and such failure is not cured within the earlier of: (A) ten (10) business days of written notice from KBS; KBS Member; or (xB) if any default continues past applicable notice and cure periods under the Hotel Management Agreement, which default would entitle Hotel Manager to terminate the Hotel Management Agreement, which such default is caused by JV Member or any Affiliate thereof; provided that it shall not be a Removal Event if the event of default in question is a result of the Company or any Subsidiary having insufficient funds or revenues due to the performance of the Project or any other circumstance outside the control of JV Member; (xi) if any default by Master Tenant continues past applicable notice and cure periods under the Franchise Agreement and Franchisor elects to exercise remedies as a result of such default, which such default is caused by JV Member or any Affiliate thereof; provided that it shall not be a Removal Event if the event of default in question is a result of the Company or any Subsidiary or the Master Tenant having insufficient funds or revenues due to the performance of the Project or any other circumstance outside the control of JV Member; (xii) the failure of JV Member to cause all liquor licenses with respect to the Projectcapital contributions set forth in Section 3.01(a)(i) and (ii), or any portion thereof, to be maintained if such failure results in a notice of default from Lender or Franchisor and JV Member fails to use commercially reasonable efforts to reinstate or replace the applicable liquor license(s)date required under the Purchase Agreement; provided that it shall not be a Removal Event if the same is a result of the Company having insufficient funds or revenues due to the performance of the Project or any other circumstance outside the control of JV Member;and (xiiiix) if JV Member resigns as Managing Member without the prior written consent of KBS unless such action is taken by JV Member in response to an act or omission (or series of acts or omissions) by KBS which constitute a willful and material default by KBS hereunder adversely affecting the Company, any Subsidiary or the Project, or any portion thereof, which is not timely cured within thirty (30) days after written notice from JV Member (or, if such default is not susceptible of cure within such thirty (30) day period, within such period as is required to effect such cure, not to exceed an additional thirty (30) days, so long as KBS has commenced such cure within such thirty (30) day period and thereafter prosecutes such cure to completion with diligence), not to exceed sixty (60) additional days in the aggregate; (xiv) a breach by JV Member of any representation or warranty contained herein materially adversely affecting the Company, any Subsidiary or the Project, or any portion thereof, which is not timely cured within thirty (30) days after written notice from KBS (or, if such default is not susceptible of cure within such thirty (30) day period, within such period as is required to effect such cure so long as JV Member has commenced such cure within such thirty (30) day period and thereafter prosecutes such cure to completion with diligence), not to exceed sixty (60) additional days in the aggregate; provided, however, that if such breach was unintentional and the adverse effect on KBS of such material breach can be remedied, and JV Member promptly so remedies such adverse effect in all material respects, then such breach shall not be deemed a Removal EventMember. Notwithstanding the foregoing, a Removal Event shall not be deemed to have occurred and the following shall not give rise to any rights in favor of KBS Member if (A) the misappropriation of funds, intentional misrepresentation, willful misconduct, felony or crime of moral turpitude or breach of trust, as the case may be, that gave rise to any right to remove the Managing Member was the action or inaction solely of any person other than Xxxx Xxxxxx, without the prior knowledge of Xxxx Xxxxxx of the act or inaction in question, (B) to the extent permitted by applicable material law, the employment of such person is terminated within ten (10) Business Days after the earlier of (i) receipt by Managing Member of notice, or (ii) the date on which Managing Member obtained actual knowledge of such employee’s misappropriation of funds, intentional misrepresentation, willful misconduct, felony or crime of moral turpitude or breach is not susceptible of being cured but the trust and evidence thereof, and (C) Managing Member takes such actions as shall be reasonably required in order to cure or ameliorate (and provide for financial compensation for any actual damages caused losses suffered for) any damage suffered by material breach can be quantified so that KBS and/or the Company or the applicable Subsidiary can be “made whole”as a consequence of such employee’s misappropriation of funds, as reasonably determined by KBS in its good faith discretionintentional misrepresentation, and the JV Member makes the necessary payment within thirty (30) days after KBS notifies JV Member willful misconduct, felony or crime of its determination moral turpitude or breach of the necessary “make whole” payment then such payment shall be deemed to have cured such Removal Event; and (xv) a Removal Event occurs under the Limited Liability Company Agreement of Property Owner JV (as the same may from time to time be amended, supplemented, restated or otherwise modified, the “Property Owner JV LLC Agreement”)trust.

Appears in 1 contract

Samples: Limited Liability Company Agreement (KBS Strategic Opportunity REIT II, Inc.)

Removal of Managing Member for Cause. KBS may, but shall not be obligated to, exercise any of the remedies provided in Section 2.06(c) and/or (d) below, as applicable, under any of the following circumstances (each a “Removal Event”): (i) if JV Member or any principal, officer, executive or employee of JV Member or any of its Affiliates has committed fraud adversely affecting the Company, any Subsidiary or the Project, or any portion thereof, or has embezzled Company funds or the funds of any Subsidiary or funds of the Project, or any portion thereof, provided that, in the case of embezzlement or fraud, if within ten (10) business days after such embezzlement or fraud is discovered by or disclosed to KBS, (x) such funds are replaced, and (y) if such embezzlement or fraud is committed by an individual other than a JV Member Principal, such individual is terminated, then such occurrence shall not be a Removal Event; for the avoidance of doubt, the commission of any act or conduct described in this clause (i) by a JV Member shall constitute a Removal Event that is not subject to the foregoing ten (10) day cure period; (ii) if JV Member or any principal, officer, executive or employee of JV Member or any of its Affiliates has committed an intentional material misrepresentation or willful misconduct (other than an act or conduct described in clause (i) above) materially and adversely affecting the Company, any Subsidiary or the Project, or any portion thereof, which is not timely cured within thirty (30) days after written notice from KBS (or, if such default is not susceptible of cure within such thirty (30) day period, within such period as is required to effect such cure, so long as JV Member has commenced such cure within such thirty (30) day period and thereafter prosecutes such cure to completion with diligence), not to exceed sixty (60) additional days in the aggregate; (iii) if any JV Member Principal is convicted or pleads guilty or nolo contendere to (x) any felony that involves in any material respect the Company and/or any Subsidiary, and/or (y) any crime involving moral turpitude or breach of trust; (iv) the affairs of JV Member cease to be principally controlled by a JV Member Principal or other JV Member Key Person; (v) a default by JV Member as Managing Member under this Agreement materially adversely affecting the Company, any Subsidiary or the Project, or any portion thereof, which is not timely cured within thirty (30) days after written notice from KBS (or, if such default is not susceptible of cure within such thirty (30) day period, within such period as is required to effect such cure, not to exceed an additional thirty (30) days, so long as JV Member has commenced such cure within such thirty (30) day period and thereafter prosecutes such cure to completion with diligence), not to exceed sixty (60) additional days in the aggregate. Notwithstanding the foregoing, if the applicable material default is not susceptible of being cured but the actual damages caused by such material default can be quantified so that KBS and/or the Company or the applicable Subsidiary can be “made whole”, as reasonably determined by KBS in its good faith discretion, and the JV Member makes the necessary payment within thirty (30) days after KBS notifies JV Member of its determination of the necessary “make whole” payment then such payment shall be deemed to have cured such Removal Event; (vi) bankruptcy of the Company or any Subsidiary filed by the Managing Member without the written approval of KBS; (vii) bankruptcy of JV Member, Member or any JV Member Principal; (viii) if any default under any Financing, including any Required Guaranty (defined below) (for which there are no notice and cure rights or for which such rights have expired and the lender has not otherwise waived such default in accordance with the terms of any Financing document) occurs, the applicable lender elects to exercise remedies as a result of such default, which such default is caused by JV Member or any Affiliate thereof; provided that it shall not be a Removal Event if the event of default in question is a result of the Company or any Subsidiary having insufficient funds or revenues due to the performance of the Project or any other circumstance outside the control of JV Member; (ix) the failure of JV Member to fund any capital contributions as and when required pursuant to Section 3.01(a) or Section 3.06 below, as applicable and such failure is not cured within ten (10) days of written notice from KBS; (x) if any default continues past applicable notice and cure periods under the Hotel Management Agreement, which default would entitle Hotel Manager to terminate the Hotel Management Agreement, which such default is caused by JV Member or any Affiliate thereof; provided that it shall not be a Removal Event if the event of default in question is a result of the Company or any Subsidiary having insufficient funds or revenues due to the performance of the Project or any other circumstance outside the control of JV Member; (xi) if any default by Master Tenant continues past applicable notice and cure periods under the Franchise Agreement and Franchisor elects to exercise remedies as a result of such default, which such default is caused by JV Member or any Affiliate thereof; provided that it shall not be a Removal Event if the event of default in question is a result of the Company or any Subsidiary or the Master Tenant having insufficient funds or revenues due to the performance of the Project or any other circumstance outside the control of JV Member; (xii) the failure of JV Member to cause all liquor licenses with respect to the Project, or any portion thereof, to be maintained if such failure results in a notice of default from Lender or Franchisor and JV Member fails to use commercially reasonable efforts to reinstate or replace the applicable liquor license(s); provided that it shall not be a Removal Event if the same is a result of the Company having insufficient funds or revenues due to the performance of the Project or any other circumstance outside the control of JV Member; (xiii) if JV Member resigns as Managing Member without the prior written consent of KBS unless such action is taken by JV Member in response to an act or omission (or series of acts or omissions) by KBS which constitute a willful and material default by KBS hereunder adversely affecting the Company, any Subsidiary or the Project, or any portion thereof, which is not timely cured within thirty (30) days after written notice from JV Member (or, if such default is not susceptible of cure within such thirty (30) day period, within such period as is required to effect such cure, not to exceed an additional thirty (30) days, so long as KBS has commenced such cure within such thirty (30) day period and thereafter prosecutes such cure to completion with diligence), not to exceed sixty (60) additional days in the aggregate; (xiv) a breach by JV Member of any representation or warranty contained herein materially adversely affecting the Company, any Subsidiary or the Project, or any portion thereof, which is not timely cured within thirty (30) days after written notice from KBS (or, if such default is not susceptible of cure within such thirty (30) day period, within such period as is required to effect such cure so long as JV Member has commenced such cure within such thirty (30) day period and thereafter prosecutes such cure to completion with diligence), not to exceed sixty (60) additional days in the aggregate; provided, however, that if such breach was unintentional and the adverse effect on KBS of such material breach can be remedied, and JV Member promptly so remedies such adverse effect in all material respects, then such breach shall not be deemed a Removal Event. Notwithstanding the foregoing, if the applicable material breach is not susceptible of being cured but the actual damages caused by material breach can be quantified so that KBS and/or the Company or the applicable Subsidiary can be “made whole”, as reasonably determined by KBS in its good faith discretion, and the JV Member makes the necessary payment within thirty (30) days after KBS notifies JV Member of its determination of the necessary “make whole” payment then such payment shall be deemed to have cured such Removal Event; and (xv) a Removal Event occurs under the Limited Liability Company Agreement of Property Owner JV KBS SOR II Q&C Operations, LLC (as the same may from time to time be amended, supplemented, restated or otherwise modified, the “Property Owner Operations JV LLC Agreement”).

Appears in 1 contract

Samples: Limited Liability Company Agreement (KBS Strategic Opportunity REIT II, Inc.)

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Removal of Managing Member for Cause. KBS Co-Managing Member may, but shall not be obligated to, exercise any of the remedies provided in Section 2.06(c) and/or (d) below, as applicable, below under any of the following circumstances (each each, a “Removal Event”): (i) if JV Member Member, or any principal, officer, executive or employee of JV Member engages in fraud, misappropriation of funds, intentional misrepresentation or any of its Affiliates has committed fraud adversely affecting willful misconduct with respect to the Company, any Subsidiary or the ProjectProperty. Notwithstanding the foregoing, or any portion thereof, or has embezzled Company funds or the funds of any Subsidiary or funds of the Project, or any portion thereof, provided that, in the case of embezzlement or if such fraud, if within ten misappropriation of funds, intentional misrepresentation or willful misconduct (10a) business days after such embezzlement or fraud is discovered by or disclosed to KBS, (x) such funds are replaced, and (y) if such embezzlement or fraud is committed by an individual other than a JV Member Principal without the knowledge of a JV Member Principal, such individual and (b) (1) is terminated, then such occurrence shall not be a Removal Event; for the avoidance of doubt, the commission of any act or conduct described in this clause (i) by JV Member shall constitute a Removal Event that is not subject to the foregoing ten (10) day cure period; (ii) if JV Member or any principal, officer, executive or employee of JV Member or any of its Affiliates has committed an intentional material misrepresentation or willful misconduct (other than an act or conduct described in clause (i) above) materially and adversely affecting the Company, any Subsidiary or the Project, or any portion thereof, which is not timely cured within thirty (30) days after written notice from KBS (or, if such default is not susceptible of cure within such thirty (30) day period, within such period as is required to effect such cure, by the payment of money so long as JV Member has commenced such cure within such thirty (30) day period and thereafter prosecutes such cure to completion with diligence), not to exceed sixty (60) additional days in the aggregate; (iii) if any JV Member Principal is convicted or pleads guilty or nolo contendere to (x) any felony that involves in any material respect the Company and/or any Subsidiary, and/or (y) any crime involving moral turpitude or breach of trust; (iv) the affairs of JV Member cease to be principally controlled by a JV Member Principal or other JV Member Key Person; (v) a default by JV Member as Managing Member under this Agreement materially adversely affecting the Company, any Subsidiary or the Project, or any portion thereof, which is not timely cured within thirty (30) days after written notice from KBS (or, if such default is not susceptible of cure within such thirty (30) day period, within such period as is required to effect such cure, not to exceed an additional thirty (30) days, so long as JV Member has commenced such cure within such thirty (30) day period and thereafter prosecutes such cure to completion with diligence), not to exceed sixty (60) additional days in the aggregate. Notwithstanding the foregoing, if the applicable material default is not susceptible of being cured but the actual damages caused by such material default can be quantified so that KBS and/or the Company or the applicable Subsidiary can be “made whole”, as reasonably determined by KBS in its good faith discretion, and the JV Member makes the necessary “make whole” payment within thirty ten (3010) business days after KBS notifies JV Member of its determination of the necessary “make whole” payment, or (2) is not susceptible of cure by the payment of money but JV Member commences such actions as shall be reasonably required in order to cure or ameliorate (and provide for financial compensation for any actual losses suffered for) any damage suffered by the Company or the applicable Subsidiary within ten (10) business days after the date on which JV Member obtained actual knowledge of such event (or, if such default is not susceptible of cure within such ten (10) business day period, within such period as is required to effect such cure so long as JV Member has commenced such cure within such ten (10) business day period and thereafter prosecutes such cure to completion with diligence, not to exceed ninety (90) additional days in the aggregate), then such payment and/or such curative actions shall be deemed to have cured such event and the initial occurrence of such event shall not be a Removal Event; (viii) bankruptcy if JV Member, or any principal, officer, executive or employee of JV Member is convicted or pleads guilty or nolo contendere to (1) any felony that involves the Company, any Subsidiary or the Property, and/or (2) any crime involving moral turpitude or breach of trust that involves the Company, any Subsidiary or the Property. Notwithstanding the foregoing, if such felony, crime or breach of trust (a) is committed by an individual other than a JV Member Principal without the knowledge of a JV Member Principal, and (b) (1) is susceptible of cure by the payment of money so that the Company and the applicable Subsidiary can be “made whole”, as reasonably determined by KBS in its good faith discretion, and JV Member makes the necessary “make whole” payment within ten (10) business days after KBS notifies JV Member of its determination of the necessary “make whole” payment, or (2) is not susceptible of cure by the payment of money but JV Member commences such actions as shall be reasonably required in order to cure or ameliorate (and provide for financial compensation for any actual losses suffered for) any damage suffered by the Company or the applicable Subsidiary within ten (10) business days after the date on which JV Member obtained actual knowledge of such event (or, if such default is not susceptible of cure within such ten (10) business day period, within such period as is required to effect such cure so long as JV Member has commenced such cure within such ten (10) business day period and thereafter SMRH:479330698.9 prosecutes such cure to completion with diligence, not to exceed ninety (90) additional days in the aggregate), then such payment and/or such curative actions shall be deemed to have cured such event and the initial occurrence of such event shall not be a Removal Event; (iii) the affairs of JV Member cease to be principally controlled by a JV Member Principal (the “Key Man Event”); (iv) JV Member has breached its material obligations as Managing Member under this Agreement or breached any representation or warranty in this Agreement in any material respect. Notwithstanding the foregoing, if such material breach (a) is committed by an individual other than a JV Member Principal without the knowledge of a JV Member Principal, and (b) (1) is susceptible of cure by the payment of money so that the Company and the applicable Subsidiary can be “made whole”, as reasonably determined by KBS in its good faith discretion, and JV Member makes the necessary “make whole” payment within ten (10) business days after KBS notifies JV Member of its determination of the necessary “make whole” payment, or (2) is not susceptible of cure by the payment of money but JV Member commences such actions as shall be reasonably required in order to cure or ameliorate (and provide for financial compensation for any actual losses suffered for) any damage suffered by the Company or the applicable Subsidiary within ten (10) business days after the date on which JV Member obtained actual knowledge of such event (or, if such default is not susceptible of cure within such ten (10) business day period, within such period as is required to effect such cure so long as JV Member has commenced such cure within such ten (10) business day period and thereafter prosecutes such cure to completion with diligence, not to exceed ninety (90) additional days in the aggregate), then such payment and/or such curative actions shall be deemed to have cured such event and the initial occurrence of such event shall not be a Removal Event; (v) Bankruptcy of the Company or any Subsidiary filed by the Managing Member without the written approval of KBSCo-Managing Member; (viivi) bankruptcy Bankruptcy of JV Member, Member or any JV Member Principal; (viiivii) if any default under any Financing, including Financing is declared by the lender and lender has elected to accelerate the loan and has either instituted legal action and/or made a claim under any Required Guaranty (defined below) (for which there are no notice and cure rights or for which such rights have expired and the lender has not otherwise waived such default in accordance with the terms of any Financing document) occurs, the applicable lender elects to exercise remedies as a result of such default, which if such default is caused by JV Member or any Affiliate thereof; provided that it shall not be a Removal Event if the event of default in question is a result of the Company or any Subsidiary having insufficient funds or revenues due to the performance of the Project or any other circumstance outside Property, if the control of JV Member; (ix) the failure of JV Member to fund any capital contributions as and when required pursuant to Section 3.01(a) or Section 3.06 below, as applicable and such failure is not cured within ten (10) days of written notice from KBS; (x) if any default continues past applicable notice and cure periods under the Hotel Management Agreement, which default would entitle Hotel Manager to terminate the Hotel Management Agreement, which such default is was caused by the Co-Managing Member or an Affiliate of the Co-Managing Member, or if Co-Managing Member approved the action of the JV Member or any Affiliate thereof; provided that it shall not be a Removal Event if the event of default in question is a result of the Company or any Subsidiary having insufficient funds or revenues due to the performance of the Project or any other circumstance outside the control of JV Memberits Affiliate; (xi) if any default by Master Tenant continues past applicable notice and cure periods under the Franchise Agreement and Franchisor elects to exercise remedies as a result of such default, which such default is caused by JV Member or any Affiliate thereof; provided that it shall not be a Removal Event if the event of default in question is a result of the Company or any Subsidiary or the Master Tenant having insufficient funds or revenues due to the performance of the Project or any other circumstance outside the control of JV Member; (xii) the failure of JV Member to cause all liquor licenses with respect to the Project, or any portion thereof, to be maintained if such failure results in a notice of default from Lender or Franchisor and JV Member fails to use commercially reasonable efforts to reinstate or replace the applicable liquor license(s); provided that it shall not be a Removal Event if the same is a result of the Company having insufficient funds or revenues due to the performance of the Project or any other circumstance outside the control of JV Member; (xiii) if JV Member resigns as Managing Member without the prior written consent of KBS unless such action is taken by JV Member in response to an act or omission (or series of acts or omissions) by KBS which constitute a willful and material default by KBS hereunder adversely affecting the Company, any Subsidiary or the Project, or any portion thereof, which is not timely cured within thirty (30) days after written notice from JV Member (or, if such default is not susceptible of cure within such thirty (30) day period, within such period as is required to effect such cure, not to exceed an additional thirty (30) days, so long as KBS has commenced such cure within such thirty (30) day period and thereafter prosecutes such cure to completion with diligence), not to exceed sixty (60) additional days in the aggregate; (xiv) a breach by JV Member of any representation or warranty contained herein materially adversely affecting the Company, any Subsidiary or the Project, or any portion thereof, which is not timely cured within thirty (30) days after written notice from KBS (or, if such default is not susceptible of cure within such thirty (30) day period, within such period as is required to effect such cure so long as JV Member has commenced such cure within such thirty (30) day period and thereafter prosecutes such cure to completion with diligence), not to exceed sixty (60) additional days in the aggregate; provided, however, that if such breach was unintentional and the adverse effect on KBS of such material breach can be remedied, and JV Member promptly so remedies such adverse effect in all material respects, then such breach shall not be deemed a Removal Event. Notwithstanding the foregoing, if the applicable material breach is not susceptible of being cured but the actual damages caused by material breach can be quantified so that KBS and/or the Company or the applicable Subsidiary can be “made whole”, as reasonably determined by KBS in its good faith discretion, and the JV Member makes the necessary payment within thirty (30) days after KBS notifies JV Member of its determination of the necessary “make whole” payment then such payment shall be deemed to have cured such Removal Event; and (xv) a Removal Event occurs under the Limited Liability Company Agreement of Property Owner JV (as the same may from time to time be amended, supplemented, restated or otherwise modified, the “Property Owner JV LLC Agreement”).

Appears in 1 contract

Samples: Limited Liability Company Agreement (KBS Strategic Opportunity REIT II, Inc.)

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