TREMONT NET FUNDING II, LLC 200 State Street Boston, Massachusetts 02109
Exhibit
10.1
TREMONT NET FUNDING II, LLC
000 Xxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
000 Xxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
December 29, 2009
XXXX 6400 XXXXXX LLC
c/x Xxxxx & Xxxxx Realty Advisors
000 Xxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxxx, 00000
c/x Xxxxx & Xxxxx Realty Advisors
000 Xxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxxx, 00000
XXXX XXXXXX CENTRE LLC
c/x Xxxxx & Xxxxx Realty Advisors
000 Xxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxxx, 00000
c/x Xxxxx & Xxxxx Realty Advisors
000 Xxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxxx, 00000
Re: TREMONT NET FUNDING II, LLC LOAN ARRANGEMENT (THE “LOAN ARRANGEMENT”) WITH XXXX
6400 XXXXXX LLC AND XXXX XXXXXX CENTRE LLC.
Dear Sir/Madam:
Reference is made to that certain $42,500,000.00 loan (hereinafter, the “Loan”)
entered into by and among XXXX XXXXXX CENTRE LLC, a Delaware limited liability company
(“Xxxxxx”), XXXX 6400 XXXXXX LLC, a Delaware limited liability company (“Xxxxxx”
and together with Xxxxxx, individually and collectively, jointly and severally, the
“Borrower”) and TREMONT NET FUNDING II, LLC (the “Lender”), under that certain (i)
Deed of Trust, Security Agreement, Assignment of Rents and Fixture Filing, dated as of June 15,
2007 which grants Lender a first priority lien on that certain property located at 0000 XXX
Xxxxxxx, Xxxxxx, Xxxxx 00000 (the “Xxxxxx Property”) and (ii) Mortgage, Security Agreement,
Assignment of Rents and Fixture Filing, dated as of June 15, 2007 which grants Lender a first
priority lien on that certain property located at 0000 Xxxxxx Xxxxx, Xxxxxxxx, Xxxxxxxx (the
“Xxxxxx Property” and together with the Xxxxxx Property, collectively, the
“Property”)(hereinafter, collectively, as have been, or may be amended, modified or
supplemented, the “Security Instrument”). Capitalized terms used herein but not defined
shall have the meaning ascribed thereto in the Security Instrument.
Whereas, Borrower has requested and Lender has agreed as follows:
(1) The term of the Loan is hereby extended from July 9, 2009 until March 31, 2010.
Accordingly, each reference in the Loan Documents to July 9, 2009 shall be deleted in its entirety
and replaced with March 31, 2010. Borrower shall have no further right to extend the term of the
Loan beyond March 31, 2010;
(2) Borrower hereby covenants and agrees that, at all times from the date hereof until March
31, 2010 (the “Final Extension Period”), it will continue to (i) attempt to lease space
within the Property to prospective third-party Tenants (in each case, notwithstanding the terms and
conditions of the Loan Documents, Lender shall have the right in its sole and absolute
discretion to approve each “new” tenant at the Property any extension or amendment of any existing
lease and any proposed capital expenditures or tenant improvements to be incurred in connection
with any such leases, extensions or amendments), and (ii) cooperate with Lender in marketing the
Property to potential purchasers and/or potential joint venture partners. Further, to the extent
Lender is successful in procuring a Person willing to (x) purchase all or a portion of the Property
for a purchase price and on terms acceptable to Lender in its sole and absolute discretion and/or
(y) enter into a joint venture agreement, on terms acceptable to Lender in its sole and absolute
discretion in which event Borrower and Guarantor are released from all of their respective direct
and indirect ownership of the Property and all of their respective obligations under the Loan
Documents. Borrower will, promptly following request by Lender execute all necessary and
appropriate documentation evidencing same in such form as is acceptable to Borrower in its
commercially reasonable judgment (it being acknowledged and agreed that any documentation which
serves to completely release Borrower and Guarantor from all of their respective direct and
indirect ownership of the Property and all of their respective obligations under the Loan Documents
shall be deemed commercially reasonable and acceptable to Borrower, provided that neither Borrower
nor Guarantor are required to incur any cost, expense or contingent liability). Lender shall
indemnify, defend and hold Borrower harmless from any and all claims, losses and/or liabilities
arising from or related to Lender’s marketing, negotiating and closing any potential sale or joint
venture arrangement for the Property;
(3) Simultaneous with Borrower’s execution of this letter (“Letter”), Borrower shall
deliver to Lender (x) with respect to the Xxxxxx Property, a fully executed special warranty deed
(in blank), xxxx of sale and assignment of rents and leases and notice letter to Tenants (copies of
which are attached hereto as Exhibit A) and (y) with respect to the Xxxxxx Property, a
fully executed special warranty deed (in blank), xxxx of sale and assignment of rents and leases
(copies of which are attached hereto as Exhibit B) (the documentation attached as
Exhibit A and Exhibit B is hereinafter referred to as the “Real Property
Transfer Documentation”). Lender shall hold the foregoing documentation in escrow until the
earlier to occur of (i) an Event of Default (in which case Lender shall have the option to record
all or a portion of the Real Property Transfer Documentation and effectuate a transfer of all or a
portion of the Property), (ii) solely with respect to the Xxxxxx Property, December 29, 2009 and
(iii) solely, with respect to the Xxxxxx Property, the earlier to occur of (aa) March 30, 2010,
(bb) the Call Option Effective Date or (cc) the Put Option Effective Date (the earlier to occur of
(aa), (bb) or (cc) is hereinafter referred to as the “Xxxxxx Transfer Event”).
With respect to the Xxxxxx Property, on or before December 29, 2009, Lender (or its nominee)
will record the applicable Real Property Transfer Documentation and effectuate the transfer of the
Xxxxxx Property from the Borrower to a nominee of Lender or such other Person as Lender may choose.
With respect to the Xxxxxx Property, on or simultaneous with the occurrence or effectiveness
(as the context so requires) of an Xxxxxx Transfer Event, Lender (or its nominee) will record the
applicable Real Property Transfer Documentation and effectuate the transfer of the Xxxxxx Property
from the Borrower to a nominee of Lender or such other Person as Lender may choose.
Notwithstanding the foregoing or anything to the contrary contained herein and solely with
respect to the Xxxxxx Property, Lender hereby agrees that in the event Lender (or its nominee) has
not recorded or executed and delivered (as applicable) the applicable Real Property Transfer
Documentation and provided written evidence thereof (in the form of conformed copies of the
recorded special warranty deeds and counter-signed copies of the xxxx of sale and assignment of
leases and rents) to Borrower by, December 29, 2009, then on December 30, 2009, Borrower shall have
the right to record a fully executed special warranty deed (granting title to the Xxxxxx Property
to TSLF XXXXXX, LLC, a Delaware limited liability company (“Xxxxxx Transferee”) (a copy of
which to accept is attached hereto as Exhibit C). Xxxxxx Transferee hereby accepts such
special warranty deed and consents to Borrower recording same. In addition to the special warranty
deed attached as part of Exhibit C, the Outside Date Real Property Transfer Documentation
(as defined below) also includes a xxxx of sale, assignment of leases and rents and a notice letter
to Tenants for the Xxxxxx Property, which will be delivered to and accepted by Xxxxxx Transferee on
or before December 31, 2009. Lender and Transferees acknowledge and agree that, except as
specifically set forth in any of the Real Property Transfer Documentation or Outside Date Real
Property Transfer Documentation applicable to the Xxxxxx Property, any transfer of the Xxxxxx
Property by Borrower pursuant to this Letter is on an “as-is”, “where-is” basis without
representation or warranty of any kind, express or implied, as to habitability, suitability for a
particular purpose, the economic or legal condition of the Property, or any other representation or
warranty, except as expressly set forth in this Letter or in the applicable transfer documents;
Further, notwithstanding the foregoing or anything to the contrary contained herein and solely
with respect to the Xxxxxx Property, Lender hereby agrees that in the event Lender (or its nominee)
has not recorded or executed and delivered (as applicable) the applicable Real Property Transfer
Documentation and provided written evidence thereof (in the form of conformed copies of the
recorded special warranty deeds and counter-signed copies of the xxxx of sale and assignment of
leases and rents) to Borrower by, the earlier to occur of (a) Xxxxx 00, 0000, (x) the Call Option
Effective Date or (c) the Put Option Effective Date, then on the earlier to occur of (aaa) March
31, 2010, (bbb) the Business Day immediately following the Call Option Effective Date or (ccc) the
Business Day immediately following the Put Option Effective Date, Borrower shall have the right to
record a fully executed special warranty deed (granting title to the Xxxxxx Property to TSLF
XXXXXX, LLC, a Delaware limited liability company (“Xxxxxx Transferee”) (a copy of which is
attached hereto as Exhibit D). Xxxxxx Transferee and Xxxxxx Transferee are referred to
collectively as “Transferees”. The documentation attached as Exhibit C and
Exhibit D is hereinafter referred to as the “Outside Date Real Property Transfer
Documentation”). In addition to the special warranty deeds attached as part of Exhibit
C and Exhibit D, respectively, the Outside Date Real Property Transfer Documentation
also includes a xxxx of sale, assignment of leases and rents and a notice letter to Tenants for the
Xxxxxx Property and Xxxxxx Property, respectively, which will be delivered to and accepted by
Transferees on or before dates set forth above applicable to the transfer of the Xxxxxx Property
and the Xxxxxx Property, respectively, as the case may be. Lender and Transferees acknowledge and
agree that, except as specifically set forth in any of the Real Property Transfer Documentation or
Outside Date Real Property Transfer Documentation applicable to the Xxxxxx Property, any transfer
of the Xxxxxx Property by Borrower pursuant to this Letter is on an “as-is”, “where-is” basis
without representation or warranty of any kind, express or implied, as to habitability, suitability
for a particular purpose, the economic or legal condition of the Property, or any other
representation or warranty, except as expressly set forth in this Letter or in the applicable
transfer documents Lender and Borrower acknowledge that it is currently contemplated that the
Xxxxxx Property will be transferred to Xxxxxx Transferee on or about March 31, 2010. However,
Lender shall have the right, in its good faith business judgment, to cause the transfer to occur
earlier as provided herein. Similarly, in the event that Borrower, in its good faith business
judgment, determines that retention of title to the Xxxxxx Property adversely impacts its ability
to obtain financing for one or more of its affiliates or is otherwise detrimental to one or more of
its affiliates’ business interests, Borrower shall also have the right to cause the transfer to
occur earlier as provided herein;
(4) Notwithstanding anything to the contrary contained herein and solely with respect to the
Xxxxxx Property, (a) Lender, upon ten (10) Business Days notice to Borrower, shall have the option,
in its sole and absolute discretion, to record the applicable Real Property Transfer Documentation
and effectuate the transfer of the Xxxxxx Property from the Borrower to a nominee of Lender or such
other Person as Lender may choose (“Call Option”). In the event Lender exercises the Call
Option, Lender shall record the Real Property Transfer Documentation applicable to the Xxxxxx
Property, on the eleventh (11th) Business Day following notice to Borrower of its
intention to exercise the Call Option (“Call Option Effective Date”) and (b) Borrower, upon
ten (10) Business Days notice to Lender, shall have the option, in its sole and absolute
discretion, to direct the Lender to record the Real Property Transfer Documentation applicable to
the Xxxxxx Property (“Put Option”). In the event Borrower exercises the Put Option, Lender
shall record the applicable Real Property Transfer Documentation on the eleventh (11th)
Business Day subsequent to its receipt of Borrower’s notice of its intent to exercise the Put
Option (“Put Option Effective Date”). In the event Lender fails to comply with the terms
and provisions of this Section 4 and record the applicable Real Property Transfer Documentation
within the time frame set forth herein, Borrower shall have the right to record the applicable
Outside Date Real Property Transfer Documentation.
(5) Simultaneous with the recordation of the Real Property Transfer Documentation or the
Outside Date Real Property Transfer Documentation which effectuates the transfer of the Xxxxxx
Property, the principal balance of the Loan shall be deemed to be reduced to Eleven Million and
00/100 Dollars.
(6) Unless otherwise determined by Lender subsequent to the occurrence of an Event of Default,
at all times during the Final Extension Period the (x) Xxxxxx Property shall be managed by Xxxxx &
Xxxxx Management Services, Inc. (“Xxxxxx Manager”), pursuant to the terms of that certain
Management Agreement (“Xxxxxx Management Agreement”), dated as of February 20, 2007,
between Xxxxxx Manager and Xxxxxx and (y) Xxxxxx Property shall be managed by Xxxxx & Xxxxx
Management Services, Inc. (“Xxxxxx Manager”), pursuant to the terms of that certain
Management Agreement (“Xxxxxx Management Agreement”), dated as of February 28, 2007,
between Xxxxxx Manager and Xxxxxx. Lender acknowledges and agrees that so long as Xxxxxx Manager
and Xxxxxx Manager are performing their respective obligation under their respective management
agreement, Xxxxxx Manager shall be entitled to receive the management fees set forth in the Xxxxxx
Management Agreement and Xxxxxx Manager shall be entitled to receive the management fees set forth
in the Xxxxxx Management Agreement;
(7) Provided there is no Event of Default, on a monthly basis Lender will release funds from
the Escrow Accounts in an amount necessary to pay Borrower’s Operating Expenses which are evidenced
by current invoices and have been approved by Lender in its reasonable discretion. Lender hereby
acknowledges and agrees that (i) as of the date hereof there is no existing Event of Default and
(ii) to the best knowledge of Lender, no condition which, with the giving of notice or passage of
time, or both, would constitute an Event of Default currently exists;
(8) Borrower hereby acknowledges and agrees that simultaneous with any ownership transfer
described herein, all rights to receive rent, awards, condemnation proceeds, refunds of any nature
whatsoever and/or any other income resulting from the ownership and operation of the Property
(inclusive of any period before the occurrence of such transfer event) shall be irrevocably
assigned (by Borrower) to and vested with Xxxxxx Transferee or Xxxxxx Transferee, as the context so
requires.
(9) Effective upon the earlier to occur of (a) the closing of any sale or joint venture with
respect to the Property, or (b) recordation of the Real Property Transfer Documentation, or (d)
recordation of the Outside Date Real Property Transfer Documentation, or (e) December 31, 2009, (1)
Lender for itself and its trustees, beneficiaries, agents, affiliates, heirs, successors and
assigns, hereby releases and forever discharges Borrower and Guarantor, and any party related to or
affiliated with Borrower and Guarantor and their respective successors and assigns (the
“Borrower Related Parties”) from and against any and all claims, obligations and/or
liabilities, at law or equity which Lender or any party related to or affiliated with Lender and
their respective successors and assigns (each a “Lender Related Party”), whether known or
unknown, which Lender or a Lender Related Party had, has or may have in the future, arising from or
related to any matter or thing relating to or in connection with the Loan and the Loan Documents,
including but not limited to, the Guaranty, tenant leases and the tenants, any agreements related
to or affecting the tenant leases, the tenants, the Property, or the Loan, any construction
defects, errors or omissions in the design or construction and arising out of the physical,
environmental, economic or legal condition of the Property, including, without limitation, any
claim for indemnification or contribution arising under the Comprehensive Environmental Response,
Compensation, and Liability Act (42 U.S.C. Section 9601, et. seq.) or any similar federal, state or
local statute, rule or ordinance relating to liability of property owners or operators for
environmental matters (collectively, “Claims”); and (2) Borrower and Guarantor and each
other Borrower Related Party hereby waives, renounces and forever discharges any claims or
counterclaims such party has or may have in the future against each and every Lender Related Party,
whether at law, under the Loan Documents or in equity, know or unknown arising from or related to
any matter which relates to the Loan and/or the Loan Documents. Lender represents and warrants
that Lender is the current legal and beneficial owners of all Claims, if any, released hereby and
has not assigned, pledged or contracted to assign or pledge any such Claim to any person; and
(10) Each party hereby expressly acknowledges and agrees that nothing contained herein
(including, but not limited to, the deliverance or recordation of the (i) Real Property Transfer
Documentation and/or (ii) the Outside Date Real Property Transfer Documentation shall serve as a
cancellation or termination of the Loan, a release of any collateral which secures the Loan or a
termination or cancellation of the Security Instrument. Further, it is expressly
acknowledged and agreed that subsequent to any transfer contemplated herein and subsequent to
the release of the Borrower Related Parties from liability under the Loan Documents, the Loan will
remain outstanding, the Loan Documents will remain in full force and effect and the Property will
continue to be encumbered by the Security Instrument until such time as it is foreclosed or
cancelled by the Lender in its sole and absolute discretion; provided that none of the Borrower
Related Parties (including, without limitation, Borrower and Guarantor) shall have any liability
for repayment of the Loan or otherwise under the Loan Documents. It is the express intent of the
Parties hereto that the Property conveyed by the (i) Real Property Transfer Documentation and/or
(ii) Outside Date Real Property Transfer Documentation shall not merge with the interest or rights
of Lender under the Loan Documents, but will be and remain at all times separate and distinct, and
Lender may thereafter sell or otherwise transfer the Property free and clear of all rights of
Borrower.
If, at any time, this Letter or the conveyance and transfer contemplated hereunder are
restrained, enjoined, set aside, avoided or held to be invalid or unenforceable for any reason, in
a bankruptcy proceeding or otherwise, as a result of any act or omission by any Borrower Related
Party or any bankruptcy proceeding affecting any Borrower Related Party, then the liabilities,
obligations, and responsibilities of the Borrower Related Parties released pursuant to Paragraph 7
automatically shall be reinstated and all of the respective rights, privileges and duties of each
of Borrower Related Party and Lender under the Loan or the Loan Documents shall be reinstated. No
Borrower Related Party shall seek to restrain, enjoin, upset, disturb, set aside, avoid or
otherwise overturn any portion of this Letter or the conveyance and transfer contemplated in this
Letter and hereby waives any rights it may have to restrain, enjoin, upset, disturb, set aside,
avoid or otherwise overturn this Letter or the conveyance and transfer contemplated in this Letter.
If a petition for relief under any federal or state bankruptcy, insolvency or reorganization law
is filed by or against either Borrower, Lender shall be entitled to immediate relief from the
automatic stay (to the extent necessary) to permit Lender to immediately exercise any and all of
its rights and remedies with respect to the Loan Documents.
Failure to comply with the terms and conditions hereof shall constitute an Event of Default
under the Loan Documents.
Unless specifically modified by the terms hereof, each of the terms, conditions and covenants
contained in the Loan Documents shall remain in full force and effect.
Please acknowledge your consent and agreed by countersigning below.
| Regards, | ||||||||
TREMONT NET FUNDING II, LLC |
||||||||
| By: | /s/ Xxxxxx X. Xxx | |||||||
| Name: | Xxxxxx X. Xxx | |||||||
| Title: | Executive Director | |||||||
Agreed and assented to as of the
21st day of December, 2009.
Xxxxxx Transferee:
| TSLF XXXXXX, LLC, | ||||||
| a Delaware limited liability company | ||||||
By: |
/s/ Xxxxxxx X. Xxxxxx | |||||
| Name: | Xxxxxxx X. Xxxxxx | |||||
| Title: | Managing Director | |||||
Xxxxxxx Transferee: |
||||||
| TSLF XXXXXX, LLC, | ||||||
| a Delaware limited liability company | ||||||
By: |
/s/ Xxxxxxx X. Xxxxxx | |||||
| Name: | Xxxxxxx X. Xxxxxx | |||||
| Title: | Managing Director | |||||
| Agreed and assented to as of the 21st day of December, 2009. | ||||||
| Borrower: | ||||||
| XXXX XXXXXX CENTRE LLC, | ||||||
| a Delaware limited liability company | ||||||
By: |
/s/ Xxxxxxx X. Xxxxxx | |||||
| Name: | Xxxxxxx X. Xxxxxx | |||||
| Title: | EVP | |||||
| XXXX 6400 XXXXXX LLC, | ||||||
| a Delaware limited liability company | ||||||
By: |
/s/ Xxxxxxx X. Xxxxxx | |||||
| Name: | Xxxxxxx X. Xxxxxx | |||||
| Title: | EVP | |||||
| Agreed and assented to as of the 21st day of December, 2009. | ||||||
| Guarantor: | ||||||
| XXXXX & XXXXX COMPANY, a Delaware corporation |
||||||
By: |
/s/ Xxxxxxx X. Xxxxxx | |||||
| Name: | Xxxxxxx X. Xxxxxx | |||||
| Title: | Executive Vice President | |||||
| Chief Financial Officer | ||||||
| Xxxxxx Manager: | ||||||
| XXXXX & XXXXX MANAGEMENT SERVICES, INC. | ||||||
By: |
/s/ Xxxxxxx X. Xxxxxx | |||||
| Name: | Xxxxxxx X. Xxxxxx | |||||
| Title: | Executive Vice President | |||||
| Chief Financial Officer | ||||||
| Xxxxxx Manager: | ||||||
| XXXXX & XXXXX MANAGEMENT SERVICES, INC. | ||||||
By: |
/s/ Xxxxxxx X. Xxxxxx | |||||
| Name: | Xxxxxxx X. Xxxxxx | |||||
| Title: | Executive Vice President | |||||
| Chief Financial Officer | ||||||
