Single Purpose Entity/Separateness. Borrower represents, warrants and covenants as of the date of hereof and (except for items (f) and (m), which are representations made only as of the date hereof, and are not continuing covenants) until such time as the Debt is paid in full as follows: (a) Borrower does not own and will not own any asset or property other than (i) the Security Property, and (ii) incidental personal property necessary for the ownership or operation of the Security Property. (b) Borrower has not engaged in and will not engage in any business other than the ownership, management and operation of the Security Property and Borrower will conduct and operate its business as presently conducted and operated. (c) Borrower will not enter into any contract or agreement with any affiliate of the Borrower, any constituent party of Borrower, any guarantor (a “Guarantor”) of the Debt or any part thereof or any affiliate of any constituent party or Guarantor, except the Management Agreement and otherwise except upon terms and conditions that are intrinsically fair and substantially similar to those that would be available on an arms-length basis with third parties other than any such party. (d) Borrower has not incurred and will not incur any indebtedness, secured or unsecured, direct or indirect, absolute or contingent (including guaranteeing any obligation), other than (i) the Debt, (ii) unsecured trade and operational debt and lease obligations incurred in the ordinary course of business not outstanding for more than sixty (60) days (subject to the AMENDED AND RESTATED MORTGAGE, SECURITY AGREEMENT AND FIXTURE FINANCING STATEMENT - Page 34 43412-20/Continental Towers provisions of Section 31 hereof) with trade creditors and in amounts as are normal and reasonable under the circumstances, but, in no event, to exceed three percent (3%) of original principal balance, (iii) debt incurred in the financing of equipment and other personal property used on the Premises, but, in no event, to exceed $72,000.00, and (iv) the Subordinate Debt. No indebtedness other than the Debt and the Subordinate Debt may be secured (subordinate or pari passu) by the Security Property. (e) Borrower has not made and will not make any loans or advances to any third party (including any affiliate or constituent party, any Guarantor or any affiliate of any constituent party or Guarantor), and shall not acquire obligations or securities of its affiliates. (f) After giving effect to the Loan contemplated by the Loan Documents, including the effect of Section 5 of the Subordination and Standstill Agreement on Subordinate Lender’s rights under the Subordinate Loan Documents, Borrower is solvent and reasonably expects to be able to pay its debts from its assets as the same shall become due. (g) Borrower has done or caused to be done and will do all things necessary to observe organizational formalities and preserve its existence, and Borrower will at all times have provisions in its organizational documents imposing on it substantially the same requirements as are specified in this Section 12, and will not, nor will any partner, member, shareholder, trustee, Lender, or principal amend, modify or otherwise change any provision of such party’s organizational documents which pertains to the subject matter of this Section 12. (h) Borrower shall continuously maintain its existence and right to do business in the state where the Security Property is located. (i) Borrower will conduct and operate its business as presently conducted and operated. (j) Borrower will maintain all of its books, records, financial statements and bank accounts separate from those of its affiliates and any constituent party and Borrower will file its own tax returns unless required otherwise by applicable law. Borrower shall maintain its books, records, resolutions and agreements as official records. (k) Borrower will be, and at all times will hold itself out to the public as, a legal entity separate and distinct from any other entity (including any affiliate of Borrower, any constituent party of Borrower, any Guarantor or any affiliate of any constituent party or Guarantor), shall correct any known misunderstanding regarding its status as a separate entity, shall conduct business in its own name, shall not identify itself or any of its affiliates as a division or part of the other and shall maintain and utilize a separate invoices and checks. (l) Neither Borrower nor any constituent party will seek the dissolution, winding up, liquidation, consolidation or merger in whole or in part, of the Borrower. (m) Borrower has and reasonably expects to maintain adequate capital for the normal obligations reasonably foreseeable in a business of its size and character and in light of its contemplated business operations. AMENDED AND RESTATED MORTGAGE, SECURITY AGREEMENT AND FIXTURE FINANCING STATEMENT - Page 35 43412-20/Continental Towers (n) Borrower will not commingle the funds and other assets of Borrower with those of any affiliate or constituent party, any Guarantor, or any affiliate of any constituent party of Guarantor, or any other person. (o) Borrower has and will maintain its assets in such a manner that it will not be costly or difficult to segregate, ascertain or identify its individual assets from those of any affiliate or constituent party, any Guarantor, or any affiliate of any constituent party or Guarantor, or any other person. (p) Borrower does not and will not guarantee, become obligated for, or hold itself out to be responsible for the debts or obligations of any other person or entity or the decisions or actions respecting the daily business or affairs of any other person or entity. (q) Borrower will not permit any affiliate or constituent party (other than Manager) independent access to its bank accounts. (r) Borrower shall pay the salaries of its own employees and maintain a sufficient number of employees, if any, in light of its contemplated business operations. (s) If Borrower is a limited partnership or a limited liability company, the general partner or managing member (the “SPC Entity”) shall be a limited liability company whose sole asset is its interest in Borrower and the SPC Entity will at all times comply, and will cause Borrower to comply, with each of the representations, warranties, and covenants contained in this Section 12 as if such representation, warranty or covenant was made directly by such general partner or managing member. (t) Borrower shall at all times cause there to be at least one duly appointed member of the board of directors or manager (an “Independent Director”) of the SPC Entity reasonably satisfactory to Lender who shall not have been at the time of such individual’s appointment, and may not have been at any time during the preceding five years (i) a shareholder of, or an officer, director, attorney, counsel, partner or employee of, Borrower, Guarantor or any of its shareholders, subsidiaries or affiliates, (ii) a customer of, or supplier to, Borrower, Guarantor or any of its shareholders, subsidiaries or affiliates, (iii) a person or other entity controlling or under common control with any such shareholder, partner, supplier or customer, or (iv) a member of the immediate family of any such shareholder, officer, director, partner, employee, supplier or customer of any other director of Borrower or Guarantor. As used herein, the term “control” means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a person or entity, whether through ownership of voting securities, by contract or otherwise. (u) Borrower shall not cause or permit the managers of the SPC Entity to take any action which, under the terms of any certificate of organization or operating agreement with respect to any membership, requires a vote of the managers of the SPC Entity unless at the time of such action there shall be at least one member or manager who is an Independent Director. (v) SPC Entity shall not, without the unanimous consent of its manager (including the Independent Manager), institute proceedings for itself or Borrower to be adjudicated bankrupt or insolvent; consent to the institution of a bankruptcy or insolvency AMENDED AND RESTATED MORTGAGE, SECURITY AGREEMENT AND FIXTURE FINANCING STATEMENT - Page 36 43412-20/Continental Towers proceedings against it or Borrower; file a petition seeking, or consent to, reorganization or relief under any applicable federal or state law relating to bankruptcy; consent to the appointment of a receiver, liquidator, assignee, trustee, sequestrator (or other similar official) for itself or Borrower or a substantial part of its or Borrower’s property; make any assignment for the benefit of creditors; or admit in writing its inability to pay its debts generally as they become due. (w) SPC Entity shall not, without the unanimous consent of its managers (including the Independent Manager), for itself or for Borrower (i) liquidate or dissolve, in whole or in part; (ii) consolidate, merge or enter into any form of consolidation with or into any other person or entity, nor convey, transfer or lease its or Borrower’s assets substantially as an entirety to any person or entity nor permit any person or entity to consolidate, merge or enter into any form of consolidation with or into itself or Borrower; or (iii) amend any provisions of its or Borrower’s organizational documents containing provisions similar to those contained in this Section 12. (x) Borrower shall conduct its business so that the assumptions made with respect to Borrower and its affiliates in the opinions of their legal counsel that have been delivered to Lender in connection with the Loan at all times shall be true and correct in all respects.
Appears in 1 contract
Samples: Mortgage, Security Agreement and Fixture Financing Statement (Prime Group Realty Trust)
Single Purpose Entity/Separateness. Borrower represents, warrants and covenants as of the date of hereof and (except for items (f) and (m), which are representations made only as of the date hereof, and are not continuing covenants) until such time as the Debt is paid in full as follows:
(a) Borrower has not owned, does not own own, and will not own any asset or property other than (i) the Security PropertyProject, and (ii) incidental personal property necessary for the ownership or operation of the Security PropertyProject.
(b) Borrower has not engaged in and will not engage in any business other than the ownership, management and operation of the Security Property Project and activities incidental thereto and Borrower will conduct and operate its business as presently conducted and operated.
(c) Borrower will not enter into any contract or agreement with any affiliate Affiliate of the Borrower, any constituent party of Borrower, any guarantor (a “Guarantor”) of the Debt or any part thereof or any affiliate Affiliate of any constituent party or Guarantorparty, except the Management Agreement and otherwise except upon terms and conditions that are intrinsically fair and substantially similar to those that would be available on an arms-length basis with third parties other than any such party.
(d) Borrower has not incurred and will not incur any indebtedness, secured or unsecured, direct or indirect, absolute or contingent (including guaranteeing any obligation), Debt which will remain outstanding as of the date hereof other than (i) the DebtLoan, (ii) unsecured trade and operational debt and lease obligations incurred in the ordinary course of business not outstanding for more than sixty (60) days (subject to the AMENDED AND RESTATED MORTGAGE, SECURITY AGREEMENT AND FIXTURE FINANCING STATEMENT - Page 34 43412-20/Continental Towers provisions of Section 31 hereof) with trade creditors and in amounts as are normal and reasonable under the circumstances, butprovided such debt is not evidenced by a note and is paid within thirty (30) days of the date it is due, in no event, to exceed three percent (3%) of original principal balance, and (iii) debt Debt incurred in the financing of equipment and other personal property used on the Premises, but, in no event, to exceed $72,000.00, and (iv) the Subordinate DebtProject. No indebtedness other than the Debt and the Subordinate Debt Loan may be secured (subordinate or pari passu) by the Security PropertyProject; provided that the debt identified pursuant to clause (iii) may be secured by the equipment financed. Notwithstanding the foregoing, Lender shall permit the equity owners of 5454 Wisconsin, Inc. to incur mezzanine debt from a lender approved by Lender and who shall be confirmed by the applicable Rating Agencies not to result in a qualification, downgrade, or withdrawal or any rating in effect immediately prior to such mezzanine loan for any securities issued in connection with the Secondary Market Transaction (the “Mezzanine Lender”) subject to the following conditions: (A) the outstanding principal balance of the Loan and the mezzanine debt shall not exceed a 75% loan to value ratio on an aggregate basis, (B) the direct or indirect owners of Borrower have at least $19,000,000.00 cash equity invested in the Project, and (C) the Project’s performance provides a 1.20:1 Debt Service Coverage at the greater of a 7.75% constant or the actual constant, taking into account both the Loan and mezzanine debt. The mezzanine debt shall be subject to an intercreditor agreement reasonably acceptable to Lender and may be secured by a pledge of the shares of 5454 Wisconsin, Inc. or The Bxxxxx Corporation and by any assets of the equity owners of 5454 Wisconsin, Inc. but shall not be secured by the Project and the mezzanine debt documents may permit Mezzanine Lender (i) to succeed to the interests of such equity owners upon a default under the mezzanine debt loan documents; (ii) following succession to such interest, to remove the managing member of Borrower and replace it with Mezzanine Lender or an entity controlled by Mezzanine Lender; and (iii) to transfer such interest to a Qualified Transferee (as defined in the Mortgage) or any other entity owned or controlled by an entity that owns or manages or controls entities that own or manage properties such as the Project; provided, however, that replacement pursuant to clause (iii) shall, if required by the pooling and servicing agreement relating to the Secondary Market Transaction (or if not a Qualified Transferee, by the applicable Rating Agencies), be subject to receipt by Lender of evidence in writing from the applicable Rating Agencies to the effect that such replacement will not result in a qualification, downgrade, or withdrawal of any rating in effect immediately prior to such replacement for any securities issued in connection with a Secondary Market Transaction, or that such replacement is otherwise approved by the applicable Rating Agencies. The mezzanine debt documents may not be assigned to another party during the term of the Loan without the prior written approval of Lender (other than to a Qualified Transferee who is not an Affiliate) and, if required by the pooling and servicing agreement relating to the Secondary Market Transaction, the applicable Rating Agencies.
(e) Borrower has not made and will not make any loans or advances to any third party (including any affiliate or constituent party, any Guarantor party or any affiliate of any constituent party or Guarantorparty), and shall not acquire obligations or securities of its affiliatesaffiliates or any constituent party.
(f) After giving effect to the Loan contemplated by the Loan Documents, including the effect of Section 5 of the Subordination and Standstill Agreement on Subordinate Lender’s rights under the Subordinate Loan Documents, Borrower is and intends to remain solvent and reasonably expects Borrower, subject to be able to Section 12.1 hereof, will pay its debts and liabilities (including, as applicable, shared personnel and overhead expenses) from its own funds and assets as the same shall become duedue to the extent Borrower has available assets to pay such debts and liabilities.
(g) Borrower has done or caused to be done and will do all things necessary to observe organizational formalities and preserve its existence, and Borrower will at all times have provisions in its organizational documents imposing on it substantially the same requirements as are specified in this Section 12, and will not, nor will Borrower permit any partner, member, shareholder, trustee, Lender, or principal constituent party to amend, modify or otherwise change any provision the partnership certificate, partnership agreement, articles of such party’s incorporation and bylaws, operating agreement, trust or other organizational documents which pertains to of Borrower or such constituent party without the subject matter prior written consent of this Section 12Lender.
(h) Borrower shall continuously maintain its existence and right to do business in the state where the Security Property is located.
(i) Borrower will conduct and operate its business as presently conducted and operated.
(j) Borrower will maintain all of its books, records, financial statements and bank accounts separate from those of its affiliates Affiliates and any constituent party except that Borrower’s financial position, assets, results of operations and cash flows may be included in the consolidated financial statements of an Affiliate of Borrower in accordance with generally accepted accounting principles, consistently applied; and Borrower will file its own tax returns unless returns, if any, as may be required otherwise by under applicable law, to the extent such entity is (i) not part of a consolidated group filing a consolidated return or returns or (ii) not treated as a division solely for tax purposes of another taxpayer. Borrower shall maintain its books, records, resolutions and agreements as official records.
(ki) Borrower will be, and at all times will hold itself out to the public as, a legal entity separate and distinct from any other entity (including any affiliate Affiliate of Borrower, any constituent party of Borrower, any Guarantor or any affiliate Affiliate of any constituent party or Guarantorparty), shall correct any known misunderstanding regarding its status as a separate entity, shall conduct business in its own name, shall not identify itself or any of its affiliates Affiliates as a division or part of the other and shall maintain and utilize a separate stationery, invoices and checks.
(lj) Borrower maintains on the Closing Date, and subject to Section 12.1 hereof, intends to maintain, adequate capital for the normal obligations reasonably foreseeable in a business of its size and character and in light of its contemplated business operations.
(k) Neither Borrower nor any constituent party will seek the dissolution, winding up, liquidation, consolidation or merger in whole or in part, of the Borrower.
(m) Borrower has and reasonably expects to maintain adequate capital for the normal obligations reasonably foreseeable in a business of its size and character and in light of its contemplated business operations. AMENDED AND RESTATED MORTGAGE, SECURITY AGREEMENT AND FIXTURE FINANCING STATEMENT - Page 35 43412-20/Continental Towers
(nl) Borrower will not commingle the funds and other assets of Borrower with those of any affiliate Affiliate or constituent party, any Guarantor, or any affiliate Affiliate of any constituent party of Guarantorparty, or any other person.
(om) Borrower has and will maintain its assets in such a manner that it will not be costly or difficult to segregate, ascertain or identify its individual assets from those of any affiliate Affiliate or constituent party, any Guarantor, or any affiliate Affiliate of any constituent party or Guarantorparty, or any other person.
(pn) Borrower does not and will not guarantee, become obligated for, or hold itself out to be responsible for the debts or obligations of any other person or entity or the decisions or actions respecting the daily business or affairs of any other person or entityperson.
(q) Borrower will not permit any affiliate or constituent party (other than Manager) independent access to its bank accounts.
(r) Borrower shall pay the salaries of its own employees and maintain a sufficient number of employees, if any, in light of its contemplated business operations.
(so) If Borrower is a limited partnership or a limited liability company (other than a single member limited liability company), the each general partner or managing member (the each, an “SPC EntityParty”) shall be a corporation or limited liability company whose sole asset is its interest in Borrower and the each such SPC Entity Party will at all times comply, and will cause Borrower to comply, with each of the representations, warranties, and covenants contained in this Section 12 6.14 as if such representation, warranty or covenant was made directly by such general partner or managing memberSPC Party.
(tp) Borrower shall at all times cause there to be at least one duly appointed member of the board of directors or manager (an “Independent DirectorManager”) of the SPC Entity reasonably satisfactory to Lender in Borrower who shall not have been at the time of such individual’s appointment, and may not have been at any time during the preceding five years (i) a shareholder of, or an officer, director, attorneypartner, counselmember (other than an independent non-economic “springing member”), partner or employee of, Borrower, Guarantor Borrower or any of its shareholders, subsidiaries their Affiliates (other than as an independent director or affiliatesmanager of such an Affiliate of the Company that is required by a creditor to be a single purpose bankruptcy remote entity), (ii) affiliated with a customer of, or supplier to, Borrowerthe SPC Party, Guarantor Borrower or any of their Affiliates (other than a company that provides professional independent managers or directors and which also provides other similar services to Borrower or any of its shareholdersmembers or Affiliates in the ordinary course of business), subsidiaries or affiliates, (iii) a spouse, parent, sibling, child, or other family relative of any person described by (i) or (ii) above. As used herein, the term “Affiliate” means any person or entity other entity controlling than the SPC Party (i) which owns beneficially, directly or indirectly, any outstanding shares of the SPC Party’s stock or interest in the Borrower or (ii) which controls or is under common control with any such shareholder, partner, supplier the SPC Party or customer, or (iv) a member of the immediate family of any such shareholder, officer, director, partner, employee, supplier or customer of any other director of Borrower or GuarantorBorrower. As used herein, the term “control” means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a person or entity, whether through ownership of voting securities, by contract or otherwise.
(u) Borrower shall not cause or permit the managers of the SPC Entity to take any action which, under the terms of any certificate of organization or operating agreement with respect to any membership, requires a vote of the managers of the SPC Entity unless at the time of such action there shall be at least one member or manager who is an Independent Director.
(v) SPC Entity shall not, without the unanimous consent of its manager (including the Independent Manager), institute proceedings for itself or Borrower to be adjudicated bankrupt or insolvent; consent to the institution of a bankruptcy or insolvency AMENDED AND RESTATED MORTGAGE, SECURITY AGREEMENT AND FIXTURE FINANCING STATEMENT - Page 36 43412-20/Continental Towers proceedings against it or Borrower; file a petition seeking, or consent to, reorganization or relief under any applicable federal or state law relating to bankruptcy; consent to the appointment of a receiver, liquidator, assignee, trustee, sequestrator (or other similar official) for itself or Borrower or a substantial part of its or Borrower’s property; make any assignment for the benefit of creditors; or admit in writing its inability to pay its debts generally as they become due.
(w) SPC Entity shall not, without the unanimous consent of its managers (including the Independent Manager), for itself or for Borrower (i) liquidate or dissolve, in whole or in part; (ii) consolidate, merge or enter into any form of consolidation with or into any other person or entity, nor convey, transfer or lease its or Borrower’s assets substantially as an entirety to any person or entity nor permit any person or entity to consolidate, merge or enter into any form of consolidation with or into itself or Borrower; or (iii) amend any provisions of its or Borrower’s organizational documents containing provisions similar to those contained in this Section 12.
(x) Borrower shall conduct its business so that the assumptions made with respect to Borrower and its affiliates in the opinions of their legal counsel that have been delivered to Lender in connection with the Loan at all times shall be true and correct in all respects.
Appears in 1 contract
Single Purpose Entity/Separateness. Borrower represents, warrants and covenants as of the date of hereof and (except for items (f) and (m), which are representations made only as of the date hereof, and are not continuing covenants) until such time as the Debt is paid in full as follows:
(a) The purpose for which Borrower is organized is and shall be limited solely to (i) owning, holding, selling, leasing, subleasing transferring, exchanging, operating and managing the Property, (ii) entering into the Loan Documents with Lender, (iii) refinancing the Property in connection with a permitted repayment of the Loan and (iv) transacting any and all lawful business for which a Borrower may be organized under its constitutive law that is incident, necessary and appropriate to accomplish the foregoing.
(b) Borrower does not own and will not own any asset or property other than (i) the Security Property, and (ii) incidental personal property necessary and convenient for and used or to be used in connection with the ownership or operation of the Security Property.
(bc) Borrower has not engaged in and will not engage in any business other than the ownership, management and operation of the Security Property and Borrower will conduct and operate its business purposes as presently conducted and operatedset forth in clause (a) above.
(cd) Other than the Management Agreement, Borrower will not enter into any contract or agreement with any affiliate Affiliate of the Borrower, any constituent party of Borrower, any owner of Borrower, any guarantors of the obligations of Borrower or any Affiliate of any such constituent party, owner or guarantor (a “Guarantor”) of collectively, the Debt or any part thereof or any affiliate of any constituent party or Guarantor"Related Parties"), except the Management Agreement and otherwise except upon terms and conditions that are intrinsically fair fair, commercially reasonable and substantially similar to those that would be available on an arms-length basis with third parties other than any not so affiliated with Borrower or such partyRelated Parties.
(de) Borrower has not incurred and will not incur any indebtedness, secured or unsecured, direct or indirect, absolute or contingent (including guaranteeing any obligation), Indebtedness other than (i) the Debt, Loan and (ii) unsecured trade and operational debt and lease obligations incurred in the ordinary course of business not outstanding for more than sixty (60) days (subject to the AMENDED AND RESTATED MORTGAGE, SECURITY AGREEMENT AND FIXTURE FINANCING STATEMENT - Page 34 43412-20/Continental Towers provisions of Section 31 hereof) with trade creditors and in amounts as are normal and reasonable under the circumstances, butprovided in no event shall such Indebtedness on this clause (ii) (A) exceed, in no eventthe aggregate, to exceed three percent (3%) of original principal balance$4,000,000, (iiiB) debt incurred in the financing of equipment and other personal property used on the Premises, but, in no event, to exceed $72,000.00, be evidenced by a note and (ivC) remain unpaid in excess of sixty (60) days from the Subordinate Debtdate incurred (unless being contested in good faith by Borrower). No indebtedness Indebtedness other than the Debt and the Subordinate Debt may be secured (senior, subordinate or pari passu) by the Security Property.
(ef) Borrower has not made and will not make any loans or advances to any third party (including any affiliate or constituent party, any Guarantor or any affiliate of any constituent party or Guarantor), Person and shall not acquire obligations or securities of its affiliatesany Related Party.
(fg) After giving effect to the Loan contemplated by the Loan Documents, including the effect of Section 5 of the Subordination and Standstill Agreement on Subordinate Lender’s rights under the Subordinate Loan Documents, Borrower is and will remain solvent and reasonably expects to be able to Borrower will pay its debts and liabilities (including, as applicable, shared personnel and overhead expenses) from its assets as the same shall become due.
(gh) Borrower has done or caused to be done and will do all things necessary to observe organizational formalities and preserve its existence, and Borrower will at all times have provisions in its organizational documents imposing on it substantially the same requirements as are specified in this Section 12, and will not, nor will it permit any partnerAffiliate of Borrower to, member, shareholder, trustee, Lender, or principal amend, modify or otherwise change any provision of such party’s the organizational documents of Borrower in any material respect which pertains adversely affects its existence as a single purpose entity or its other obligations with respect to the subject matter Loan without the prior written consent of this Section 12.
(h) Borrower shall continuously maintain its existence and right to do business in the state where the Security Property is locatedLender.
(i) Borrower will conduct and operate its business as presently conducted and operated.
(j) Borrower will maintain all of its books, records, financial statements and bank accounts separate from those of any other Person and, except as required or permitted under GAAP, its affiliates and assets will not be listed as assets on the financial statement of any constituent party and other Person. Borrower will file its own tax returns unless and will not file a consolidated federal income tax return with any other Person (except that Borrower may file or may be part of a consolidated federal tax return to the extent required otherwise or permitted by applicable law); provided, however, that there shall be an appropriate notation indicating the separate existence of Borrower and its assets and liabilities. Borrower shall maintain its books, records, resolutions and agreements as official records.
(kj) Borrower will be, and at all times will hold itself out to the public as, a legal entity separate and distinct from any other entity Person (including any affiliate of Borrower, any constituent party of Borrower, any Guarantor Affiliate or any affiliate of any constituent party or Guarantorother Related Party), shall correct any known misunderstanding regarding its status as a separate entity, shall conduct business in its own name, shall not identify itself or any of its affiliates Affiliates as a division or part of the other and shall maintain and utilize a separate stationery, invoices and checkschecks or clearly indicate its separate existence in any correspondence sent by it or on its behalf.
(l) Neither Borrower nor any constituent party will seek the dissolution, winding up, liquidation, consolidation or merger in whole or in part, of the Borrower.
(mk) Borrower has and reasonably expects to will maintain adequate capital for the normal obligations reasonably foreseeable in a business of its size and character and in light of its contemplated business operations. AMENDED AND RESTATED MORTGAGE.
(l) Neither Borrower nor any Related Party will seek the dissolution, SECURITY AGREEMENT AND FIXTURE FINANCING STATEMENT - Page 35 43412-20/Continental Towerswinding up, liquidation, consolidation or merger in whole or in part, or the sale of material assets of Borrower.
(m) Borrower will not commingle its assets with those of any other Person and will hold all of its assets in its own name;
(n) Borrower will not commingle guarantee or become obligated for the funds and other assets of Borrower with those debts of any affiliate or constituent party, any Guarantor, or any affiliate of any constituent party of Guarantor, or any other person.
(o) Borrower has Person and will maintain its assets in such a manner that it will not be costly or difficult to segregate, ascertain or identify its individual assets from those of any affiliate or constituent party, any Guarantor, or any affiliate of any constituent party or Guarantor, or any other person.
(p) Borrower does not and will not guarantee, become obligated for, or hold itself out to be as being responsible for the debts or obligations of any other person or entity or the decisions or actions respecting the daily business or affairs of any other person or entityPerson.
(qo) Borrower will not permit any affiliate or constituent party (other than Manager) independent access to its bank accountsshall be a single-member limited liability company organized under the laws of the State of Delaware.
(r) Borrower shall pay the salaries of its own employees and maintain a sufficient number of employees, if any, in light of its contemplated business operations.
(s) If Borrower is a limited partnership or a limited liability company, the general partner or managing member (the “SPC Entity”) shall be a limited liability company whose sole asset is its interest in Borrower and the SPC Entity will at all times comply, and will cause Borrower to comply, with each of the representations, warranties, and covenants contained in this Section 12 as if such representation, warranty or covenant was made directly by such general partner or managing member.
(tp) Borrower shall at all times cause there to be at least one two duly appointed member Independent Managers of the board of directors or manager (an “Independent Director”) of the SPC Entity reasonably satisfactory to Lender who shall not have been at the time of such individual’s appointment, and may not have been at any time during the preceding five years (i) a shareholder of, or an officer, director, attorney, counsel, partner or employee of, Borrower, Guarantor or any of its shareholders, subsidiaries or affiliates, (ii) a customer of, or supplier to, Borrower, Guarantor or any of its shareholders, subsidiaries or affiliates, (iii) a person or other entity controlling or under common control with any such shareholder, partner, supplier or customer, or (iv) a member of the immediate family of any such shareholder, officer, director, partner, employee, supplier or customer of any other director of Borrower or Guarantor. As used herein, the term “control” means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a person or entity, whether through ownership of voting securities, by contract or otherwise.
(uq) Borrower shall allocate fairly and reasonably any overhead expenses that are shared with an Affiliate, including paying for office space and services performed by any employee of an Affiliate or Related Party.
(r) Borrower shall not cause or permit the managers of the SPC Entity to take any action which, under the terms of any certificate of organization or operating agreement with respect to any membership, requires a vote of the managers of the SPC Entity unless at the time of such action there shall be at least one member or manager who is an Independent Director.
(v) SPC Entity shall not, without the unanimous consent of pledge its manager (including the Independent Manager), institute proceedings for itself or Borrower to be adjudicated bankrupt or insolvent; consent to the institution of a bankruptcy or insolvency AMENDED AND RESTATED MORTGAGE, SECURITY AGREEMENT AND FIXTURE FINANCING STATEMENT - Page 36 43412-20/Continental Towers proceedings against it or Borrower; file a petition seeking, or consent to, reorganization or relief under any applicable federal or state law relating to bankruptcy; consent to the appointment of a receiver, liquidator, assignee, trustee, sequestrator (or other similar official) for itself or Borrower or a substantial part of its or Borrower’s property; make any assignment assets for the benefit of creditors; or admit in writing its inability any other Person other than with respect to pay its debts generally as they become duethe Loan.
(ws) SPC Entity Borrower shall not, without the unanimous consent maintain a sufficient number of employees in light of its managers (including contemplated business operations or retain the Independent Manager)services of agents or consultants therefor and pay the salaries of such employees, for itself agents or for Borrower (i) liquidate or dissolve, in whole or in part; (ii) consolidate, merge or enter into any form of consolidation with or into any other person or entity, nor convey, transfer or lease consultants from its or Borrower’s assets substantially as an entirety to any person or entity nor permit any person or entity to consolidate, merge or enter into any form of consolidation with or into itself or Borrower; or (iii) amend any provisions of its or Borrower’s organizational documents containing provisions similar to those contained in this Section 12own funds.
(xt) Borrower shall conduct its business so that the assumptions made with respect to Borrower and its affiliates in the opinions of their legal counsel that have been delivered to Lender in connection with the Loan at all times Nonconsolidation Opinion shall be true and correct in all material respects.
Appears in 1 contract
Single Purpose Entity/Separateness. Borrower represents, warrants and covenants as of the date of hereof and (except for items (f) and (m), which are representations made only as of the date hereof, and are not continuing covenants) until such time as the Debt is paid in full as follows:
(a) Borrower does not own and will not own any asset or property other than (i) the Security Property, and (ii) incidental personal property necessary for the ownership or operation of the Security Property.. AMENDED AND RESTATED MORTGAGE, SECURITY AGREEMENT AND FIXTURE FINANCING STATEMENT - Page 34 43412-20/Continental Towers
(b) Borrower has not engaged in and will not engage in any business other than the ownership, management and operation of the Security Property and Borrower will conduct and operate its business as presently conducted and operated.
(c) Borrower will not enter into any contract or agreement with any affiliate of the Borrower, any constituent party of Borrower, any guarantor (a “Guarantor”) of the Debt or any part thereof or any affiliate of any constituent party or Guarantor, except the Management Agreement and otherwise except upon terms and conditions that are intrinsically fair and substantially similar to those that would be available on an arms-length basis with third parties other than any such party.
(d) Borrower has not incurred and will not incur any indebtedness, secured or unsecured, direct or indirect, absolute or contingent (including guaranteeing any obligation), other than (i) the Debt, (ii) unsecured trade and operational debt and lease obligations incurred in the ordinary course of business not outstanding for more than sixty (60) days (subject to the AMENDED AND RESTATED MORTGAGE, SECURITY AGREEMENT AND FIXTURE FINANCING STATEMENT - Page 34 43412-20/Continental Towers provisions of Section 31 hereof) with trade creditors and in amounts as are normal and reasonable under the circumstances, but, in no event, to exceed three percent (3%) of original principal balance, (iii) debt incurred in the financing of equipment and other personal property used on the Premises, but, in no event, to exceed $72,000.00128,000.00, and (iv) the Subordinate Debt. No indebtedness other than the Debt and the Subordinate Debt may be secured (subordinate or pari passu) by the Security Property.
(e) Borrower has not made and will not make any loans or advances to any third party (including any affiliate or constituent party, any Guarantor or any affiliate of any constituent party or Guarantor), and shall not acquire obligations or securities of its affiliates.
(f) After giving effect to the Loan contemplated by the Loan Documents, including the effect of Section 5 of the Subordination and Standstill Agreement on Subordinate Lender’s rights under the Subordinate Loan Documents, Borrower is solvent and reasonably expects to be able to pay its debts from its assets as the same shall become due.
(g) Borrower has done or caused to be done and will do all things necessary to observe organizational formalities and preserve its existence, and Borrower will at all times have provisions in its organizational documents imposing on it substantially the same requirements as are specified in this Section 12, and will not, nor will any partner, member, shareholder, trustee, Lender, or principal amend, modify or otherwise change any provision of such party’s organizational documents which pertains to the subject matter of this Section 12.
(h) Borrower shall continuously maintain its existence and right to do business in the state where the Security Property is located.
(i) Borrower will conduct and operate its business as presently conducted and operated.
(j) Borrower will maintain all of its books, records, financial statements and bank accounts separate from those of its affiliates and any constituent party and Borrower will file its own tax returns unless required otherwise by applicable law. Borrower shall maintain its books, records, resolutions and agreements as official records.. AMENDED AND RESTATED MORTGAGE, SECURITY AGREEMENT AND FIXTURE FINANCING STATEMENT - Page 35 43412-20/Continental Towers
(k) Borrower will be, and at all times will hold itself out to the public as, a legal entity separate and distinct from any other entity (including any affiliate of Borrower, any constituent party of Borrower, any Guarantor or any affiliate of any constituent party or Guarantor), shall correct any known misunderstanding regarding its status as a separate entity, shall conduct business in its own name, shall not identify itself or any of its affiliates as a division or part of the other and shall maintain and utilize a separate invoices and checks.
(l) Neither Borrower nor any constituent party will seek the dissolution, winding up, liquidation, consolidation or merger in whole or in part, of the Borrower.
(m) Borrower has and reasonably expects to maintain adequate capital for the normal obligations reasonably foreseeable in a business of its size and character and in light of its contemplated business operations. AMENDED AND RESTATED MORTGAGE, SECURITY AGREEMENT AND FIXTURE FINANCING STATEMENT - Page 35 43412-20/Continental Towers.
(n) Borrower will not commingle the funds and other assets of Borrower with those of any affiliate or constituent party, any Guarantor, or any affiliate of any constituent party of Guarantor, or any other person.
(o) Borrower has and will maintain its assets in such a manner that it will not be costly or difficult to segregate, ascertain or identify its individual assets from those of any affiliate or constituent party, any Guarantor, or any affiliate of any constituent party or Guarantor, or any other person.
(p) Borrower does not and will not guarantee, become obligated for, or hold itself out to be responsible for the debts or obligations of any other person or entity or the decisions or actions respecting the daily business or affairs of any other person or entity.
(q) Borrower will not permit any affiliate or constituent party (other than Manager) independent access to its bank accounts.
(r) Borrower shall pay the salaries of its own employees and maintain a sufficient number of employees, if any, in light of its contemplated business operations.
(s) If Borrower is a limited partnership or a limited liability company, the general partner or managing member (the “SPC Entity”) shall be a limited liability company whose sole asset is its interest in Borrower and the SPC Entity will at all times comply, and will cause Borrower to comply, with each of the representations, warranties, and covenants contained in this Section 12 as if such representation, warranty or covenant was made directly by such general partner or managing member.
(t) Borrower shall at all times cause there to be at least one duly appointed member of the board of directors or manager (an “Independent Director”) of the SPC Entity reasonably satisfactory to Lender who shall not have been at the time of such individual’s appointment, and may not have been at any time during the preceding five years (i) a shareholder of, or an officer, director, attorney, counsel, partner or employee of, Borrower, Guarantor or any of its shareholders, subsidiaries or affiliates, (ii) a customer of, or supplier to, Borrower, Guarantor or any of its shareholders, subsidiaries or affiliates, (iii) a person or other entity controlling or under common control with any such shareholder, partner, supplier or customer, or (iv) a member of the immediate family of any such shareholder, officer, director, partner, employee, supplier or customer of any other director of Borrower or Guarantor. As used herein, the term “control” means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a person or entity, whether through ownership of voting securities, by contract or otherwise.
(u) Borrower shall not cause or permit the managers of the SPC Entity to take any action which, under the terms of any certificate of organization or operating agreement with respect to any membership, requires a vote of the managers of the SPC Entity unless at the time of such action there shall be at least one member or manager who is an Independent Director.
(v) SPC Entity shall not, without the unanimous consent of its manager (including the Independent Manager), institute proceedings for itself or Borrower to be adjudicated bankrupt or insolvent; consent to the institution of a bankruptcy or insolvency AMENDED AND RESTATED MORTGAGE, SECURITY AGREEMENT AND FIXTURE FINANCING STATEMENT - Page 36 43412-20/Continental Towers proceedings against it or Borrower; file a petition seeking, or consent to, reorganization or relief under any applicable federal or state law relating to bankruptcy; consent to the appointment of a receiver, liquidator, assignee, trustee, sequestrator (or other similar official) for itself or Borrower or a substantial part of its or Borrower’s property; make any assignment for the benefit of creditors; or admit in writing its inability to pay its debts generally as they become due.
(w) SPC Entity shall not, without the unanimous consent of its managers (including the Independent Manager), for itself or for Borrower (i) liquidate or dissolve, in whole or in part; (ii) consolidate, merge or enter into any form of consolidation with or into any other person or entity, nor convey, transfer or lease its or Borrower’s assets substantially as an entirety to any person or entity nor permit any person or entity to consolidate, merge or enter into any form of consolidation with or into itself or Borrower; or (iii) amend any provisions of its or Borrower’s organizational documents containing provisions similar to those contained in this Section 12.
(x) Borrower shall conduct its business so that the assumptions made with respect to Borrower and its affiliates in the opinions of their legal counsel that have been delivered to Lender in connection with the Loan at all times shall be true and correct in all respects.Towers
Appears in 1 contract
Samples: Mortgage, Security Agreement and Fixture Financing Statement (Prime Group Realty Trust)
