PLEDGE AND SECURITY AGREEMENT
THIS PLEDGE AND SECURITY AGREEMENT (as amended, modified, supplemented,
extended, restated or replaced from time to time, this "Agreement"), is made as
of November 22, 2002, by CEDAR INCOME FUND PARTNERSHIP, L.P., a Delaware limited
partnership, having an office c/o Cedar Bay Realty Advisors, Inc., 00 Xxxxx
Xxxxxx Xxxxxx, Xxxxx 000, Xxxx Xxxxxxxxxx, Xxx Xxxx 00000 ("Pledgor"), in favor
of SWH FUNDING CORP., a New Jersey corporation, having an office at Xxx
Xxxxxxxxxx Xxxxx, Xxxxxxxxxx, Xxx Xxxxxx 00000 (together with its successors,
assigns and participants, "Lender").
WITNESSETH:
WHEREAS, Lender has made, or is about to make, that certain loan to Pledgor in
the principal amount of $6,000,000.00 (the "Loan"), pursuant to the terms,
conditions and provisions of that certain Loan Agreement, as of even date
herewith, by and between Lender, as lender, and Pledgor, as borrower (as
amended, modified, supplemented, extended, restated or replaced from time to
time, the "Loan Agreement"), which Loan is evidenced by, inter alia, that
certain Promissory Note, of even date herewith, made by Pledgor, as maker, to
the order of Lender, as payee, in the amount of $6,000,000.00 (as amended,
modified, supplemented, extended, restated, replaced, severed or split from time
to time, the "Note" and, together with the Loan Agreement and all related
documents, agreements and instruments executed and delivered as security for the
Note or in order to evidence or establish or secure the Loan, including, without
limitations this Agreement, the "Loan Documents"), and secured by, inter alia,
this Agreement; and
WHEREAS, Pledgor is (a) a member of Cedar Center Holdings LLC 3, a Delaware
limited liability company ("Holdings") and the owner of 100% of the equity
interests therein, Holdings having been formed pursuant to the terms and
provisions of that certain Certificate of Formation, filed with the Secretary of
State of Delaware (the "Secretary of State") on September 13, 2001 (the
"Holdings Certificate of Formation") and (b) the sole member of Cedar-Camp Hill
LLC, a Delaware limited liability company ("Camp Hill") and the owner of 100%
of the membership interests therein, Camp Hill having been formed pursuant to
the terms and provisions of that certain Certificate of Formation, filed with
the Secretary of State on November 1, 2002 (the "Camp Hill Certificate of
Formation" and, together with the Holdings Certificate of Formation, the
"Certificates of Formation"); and
WHEREAS, as a condition of making the Loan to Pledgor, Lender has required that
Pledgor enter into this Agreement; and
WHEREAS, Pledgor will derive substantial economic benefit from the Loan being
made and, accordingly, Pledgor desires to execute and deliver this Agreement.
NOW, THEREFORE, for Ten Dollars ($10.00) and in consideration of the mutual
covenants and agreements herein contained, and other good and valuable
consideration, the receipt and sufficiency of which being hereby acknowledged,
the parties hereto agree as follows:
1. Capitalized Terms. All capitalized terms used herein, but not otherwise
defined herein, shall have the respective meanings ascribed thereto in the Loan
Agreement and, for the purposes of this Agreement, the following capitalized
terms shall have the following meanings:
(a) "Camp Hill Membership Interest" means all of Pledgor's -right, title and
interest, whether now owned or hereafter acquired, as the sole member of Camp
Hill (as evidenced by such certificates or other documents evidencing ownership
interest, as applicable, of Camp Hill), or any successor limited liability
company or other successor entity, including, without limitation, (i) Pledgor's
share of the profits, losses and capital of Camp Hill and the right to vote, if
any, and all instruments, whether heretofore or hereafter acquired, evidencing
such rights and interests, (ii) all Distributions, (iii) all proceeds
(including, without limitation, claims against third parties), products and
accessions of the foregoing, (iv) all replacements and substitutions of the
foregoing, (v) all books and records (including, without limitation,
computerized records, software and disks) relating to any of the foregoing and
(vi) all instruments, certificates or other evidence of the foregoing.
(b) "Camp Hill Collateral" means the Camp Hill Membership Interest.
(c) "Distributions" means all distributions (whether in cash or in kind) and
all interest on or in respect of, and all proceeds of, any instrument or
interest constituting part of the applicable membership interest, of whatever
kind or description, real or personal, whether in the ordinary course or in
partial or total liquidation or dissolution, or any recapitalization,
reclassification of capital, or reorganization or reduction of capital, or
otherwise.
(d) "Event of Default" has the meaning ascribed thereto in Section 7 hereof
(e) "Holdings Collateral" means, all Distributions constituting part of the
Holdings Membership Interest.
(f) "Holdings Membership Interest " means all of Pledgor's right, title and
interest, whether now owned or hereafter acquired, (i) as a member of Holdings
(as evidenced by such certificates of shares of stock or other documents
evidencing ownership interest, as applicable, of Holdings), or any successor
limited liability company or other successor entity, including, without
limitation, Pledgor's share of the profits, losses and capital of Holdings, and
the right to vote, if any, and all instruments, whether heretofore or hereafter
acquired, evidencing such rights and interests, (ii) all Distributions (as
hereinafter defined), (iii) proceeds (including, without limitation, claims
against third parties), products and accessions of the foregoing, (iv) all
replacements and substitutions of the foregoing, and (v) all instruments,
certificates or other evidence of the foregoing.
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(g) "Operating Agreements" means, collectively, the Camp Hill Operating
Agreement (as defined herein) and the Holdings Operating Agreement.
(h) "Pledged Collateral" means, collectively, the Holdings Collateral and the
Camp Hill Collateral.
(i) "Security Interest" has the meaning ascribed thereto in Section 2 hereof
2. Pledge. As security for the Obligations, Pledgor hereby grants to Lender a
direct and exclusive first priority perfected, continuing security interest in
the Pledged Collateral and in all proceeds thereof and interests thereto,
therein and thereon (the "Security Interest"), and is delivering to Lender
together herewith UCC financing statements duly executed by Pledgor.
3. Distributions. Prior to the date on which there shall have occurred an Event
of Default, Pledgor may receive, expend and further distribute any
Distributions, free and clear of the terms hereof and of the security interest
created hereby, subject, however, to the applicable terms and provisions of the
other Loan Documents. Upon the occurrence of an Event of Default, without
presentment, demand, notice or protest of any kind, Pledgor hereby irrevocably
authorizes and directs each of Camp Hill and Holdings to distribute, transfer,
pay and deliver, in accordance with the Agreements and Acknowledgments of
Pledge, the forms of which are attached hereto as Exhibit A (the "Camp Hill
Consent") and Exhibit B (the "Holdings Consent" and, together with the Camp Hill
Consent, the "Consents"), all Distributions at such time and in such manner as
such Distributions would otherwise be distributed, transferred, paid and
delivered to Pledgor directly to Lender for application against the Obligations,
and agrees, at the request of Lender, to execute and deliver appropriate forms
of assignment, UCC financing statements, and other appropriate instruments
indicating the Security Interest of Lender in any such Distributions, duly
executed by Pledgor as additional collateral security for the Obligations. If
Pledgor receives any Distributions upon and after the occurrence of an Event of
Default, Pledgor shall accept the same as Lender's agent and hold the same in
trust on behalf of and for the benefit of Lender and shall promptly deliver the
same forthwith to Lender, together with appropriate forms of assignment, UCC
financing statements, and other appropriate instruments indicating the Security
Interest of Lender in and to such Distributions, duly executed by Pledgor as
additional collateral security for the Obligations. Pledgor authorizes and
directs Lender to apply any cash Distributions received by it to the payment of
the Obligations in the order of priority elected by Lender. Lender shall not
have any liability whatsoever to Pledgor with respect to the Distributions so
received, nor shall Lender be liable to Pledgor in any manner with respect to
the holding by Lender of any Distributions pursuant to this Agreement, nor shall
Lender have any obligation to take any action (including, without limitation,
the obtaining of insurance) with respect to any Distributions held by it, except
to remit to Pledgor the value thereof in excess of the Obligations.
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4. Voting Rights.
Pledgor hereby assigns to Lender (a) all of its rights under the Camp Hill
Certificate of Formation and the Limited Liability Company Agreement of Camp
Hill, dated as of November 1, 2002 (as the same may hereafter be amended,
modified, supplemented, restated or replaced from time to time, the "Camp Hill
Operating Agreement") and (b) all of its rights to vote and give approvals,
consents, decisions and directions and exercise any other similar right with
respect to any lawful company action in respect of Camp Hill and the Camp Hill
Collateral (collectively, the "Voting Rights"), subject to the terms and
provisions of this Agreement. Lender shall hold the Voting Rights so transferred
to it under the terms and conditions hereinafter set forth.
(a) Prior to the date upon which there shall have occurred an Event of Default,
Pledgor may exercise the Voting Rights; provided, however, that the Voting
Rights shall not be exercised in a manner which would violate or be inconsistent
with any provision of this Agreement or any other Loan Document. Upon the
occurrence of an Event of Default hereunder or under any other Loan Document,
Lender shall have the right to exercise, in person or by its nominees or
proxies, all Voting Rights transferred to it hereunder and Lender shall have the
right (but not the obligation), with respect to any lawful company action for
which Voting Rights may be exercised, to exercise the Voting Rights transferred
to it by Pledgor in such manner as Lender in its sole discretion shall deem to
be in Lender's best interests. Pledgor shall effect the directions of Lender in
connection with any such exercise in accordance with this Agreement.
(b) In determining whether Lender is entitled to exercise the Voting Rights
hereunder, Camp Hill shall be entitled to rely on a notice from Lender stating
that an Event of Default has occurred under the Loan Agreement or any other Loan
Document, in which event no further direction from Pledgor shall be required to
effect the assignment of Voting Rights hereunder from Pledgor to Lender, and
Camp Hill shall immediately permit Lender to exercise all of the Voting Rights
in respect of the business and affairs of Camp Hill. Pledgor hereby agrees that
Camp Hill shall have any obligation to, and shall not, honor or observe any
notice or direction of Pledgor which conflicts with or questions the authority
of Lender as set forth in any such Lender's notice delivered pursuant to this
Agreement.
(c) Pledgor acknowledges that, except for this Agreement and the Camp Hill
Operating Agreement, it has not entered into, and is not bound by the terms of,
any agreement or understanding with respect to the purchase, sale, transfer or
voting of any Voting Rights.
5. Termination of Agreement. Upon the indefeasible payment and satisfaction in
full of the Obligations in accordance with the terms of the Loan Agreement and
the other Loan Documents (except for such of the obligations which by the terms
upon which such obligations were created survive the payment in full of the
Obligations), this Agreement shall immediately cease, terminate and be of no
further force or effect (subject to survival of certain matters as provided
herein). Thereafter, upon the request of Pledgor and at Pledgor's sole cost and
expense, Lender shall deliver to Pledgor a termination of this Agreement
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(subject to survival of certain matters as provided herein), together with
appropriate instruments of reassignment as reasonably requested by Pledgor and
UCC-3 (or UCC-2, as applicable) termination statements, and to return to Pledgor
the balance of the Pledged Collateral, if any, to the extent in Lender's
possession, and to the extent the same shall not have been sold or otherwise
applied or forfeited pursuant to the terms hereof.
6. Lender's Liability. Neither Lender nor any officer, director, employee or
agent of Lender shall be liable for the consequence of any Voting Right cast of
given by it in good faith nor have any duty or liability to preserve the Pledgor
Collateral or any rights pertaining thereto.
7. Rights of Lender.
(a) Lender shall not be liable for failure to collect or realize upon the
Obligations or any collateral security or guarantee therefor, or any part
thereof, or for any delay in so doing nor be under any obligation to take any
action whatsoever with regard thereto. After an Event of Default has occurred,
Lender or its nominee may, without notice, exercise its remedies in accordance
with this Agreement, including, without limitation, Section 9 hereof, all
without liability except to account for property actually received by Lender or
its nominee; provided, however that Lender shall not have any duty to exercise
any of the foregoing actions or any liability for failure to do so or delay in
so doing.
(b) Pledgor hereby authorizes Lender, but without any obligation so to do, to
file all financing and continuation statements and amendments to financing
statements (including, without limitation, all UCC and UCC-3 (or UCC-2, as
applicable) financing and continuation statements), naming Pledgor as debtor,
with respect to any of the security interest granted hereby and the Pledged
Collateral (including, without limitation, such as may be necessary to create,
renew, extend and continue the perfection of the Security Interest) without the
signature of Pledgor or executed by Lender as attorney-in-fact for Pledgor, and
consent to a carbon, photocopy or other reproduction of this Agreement or of a
financing statement being sufficient as a financing statement.
8. Events of Default. Any one or more of the events or conditions hereinbelow
set forth shall constitute an "Event of Default" hereunder:
(a) Failure by Pledgor to duly keep, perform and observe any tenon, condition,
covenant or agreement in this Agreement within ten (10) days of Lender's notice
thereof; provided, however, that in the event such failure is curable but not
reasonably susceptible of cure within such ten (10) days, and Pledgor commences
the cure thereof within such ten (10) days, Pledgor's failure to effect such
cure within such ten (10) days shall not constitute an Event of Default if
Pledgor diligently prosecutes such cure to completion within thirty
(30) days of Lender's notice of such failure.
(b) If, at any time, any representation, warranty or certification made by
Pledgor in this Agreement, or in any document delivered pursuant hereto, shall
be untrue, incorrect or misleading in any material respect.
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(c) The entry by a court of (i) a decree or order for relief in respect of
Pledgor, in an involuntary case or proceeding under any applicable Federal or
state bankruptcy, insolvency, reorganization or other similar law, or (ii) a
decree or order adjudging Pledgor, a bankrupt or insolvent, or approving as
properly filed a petition seeking reorganization, arrangement, adjustment or
composition of or in respect of Pledgor, under any applicable Federal or state
bankruptcy, insolvency, reorganization or other similar law, or appointing a
custodian, receiver, liquidator, assignee, trustee, sequestrator or other
similar official of Pledgor, or of any substantial part of the property of, or
ordering the winding up or liquidation of the affairs of, Pledgor, and the
continuance of any such decree or order for relief or any such other decree or
order unstayed and in effect for a period of thirty (30) days.
(d) (i) The commencement by Pledgor of a voluntary case or proceeding under any
applicable Federal or state bankruptcy, insolvency, reorganization or other
similar law, or of any other case or proceeding, to be adjudicated a bankrupt or
insolvent, (ii) the consent by Pledgor (A) to the entry of a decree or order for
relief in respect of Pledgor, in an involuntary case or proceeding under any
applicable Federal or state bankruptcy, insolvency, reorganization or other
similar law or (B) to the commencement of any bankruptcy or insolvency case or
proceeding against Pledgor, (iii) the filing by Pledgor of a petition or answer
or consent seeking reorganization or relief under any applicable Federal or
state bankruptcy, insolvency, reorganization or other similar law, (iv) the
consent by Pledgor to the filing of such petition or to the appointment of or
taking possession by a custodian, receiver, liquidator, assignee, trustee,
sequestrator or similar official of Pledgor, or of any substantial part of any
property of Pledgor, (v) the making by Pledgor of an assignment for the benefit
of creditors, or (vi) the admission by Pledgor in writing of its inability to
pay its debts generally as they become due.
(e) If, at any time, a judgment shall be rendered against Pledgor which, in
Lender's reasonable judgment, will adversely affect the ability of Pledgor to
perform any of its obligations under this Agreement or any other Loan Document.
(f) The issuance by any Subsidiary of any class or type of ownership interest of
any nature whatsoever to Pledgor or any other Person without the express prior
written consent of Lender.
(g) The occurrence of an Event of Default (as defined in the Loan Agreement)
under the Loan Agreement.
An Event of Default under any of clauses (a) through (d) immediately above,
inclusively, shall constitute an "Event of Default" under all of the other Loan
Documents.
9. Remedies. Lender, without demand of performance or other demand,
advertisement or notice of any kind (except the notice specified below of time
and place of public or private sale) to or upon Pledgor or any other Person (all
and each of which demands, advertisements and/or notices is hereby expressly
waived to the extent permitted by applicable law), may, without obligation to
resort to other security, and in addition to and not in limitation of any and
all other remedies reserved to Lender, hereunder or at law or in equity,
forthwith after the occurrence of an Event of Default which is continuing and
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not expressly waived in writing by Lender, collect, receive, appropriate and
realize upon the Pledged Collateral, or any part thereof, and/or may forthwith
sell, assign, give an option or options to purchase, contract to sell or
otherwise dispose of and deliver the Pledged Collateral and the other rights
granted to Lender hereunder, or any part thereof, in one or more parcels at
public or private sale or sales, at any exchange, broker's board or at any of
Lender's offices or elsewhere upon such terms and conditions as it may
reasonably deem advisable and at such prices as it may deem best, for cash or on
credit or for future delivery without assumption of any credit risk, with the
right to Lender upon any such sale or sales, public or private, to purchase the
whole or any part of the Pledged Collateral and the other rights granted to
Lender hereunder so sold, free of any right or equity of redemption in Pledgor,
which right or equity is hereby expressly waived and released. Lender shall not
be obligated to make any sale of the Pledged Collateral and the other rights
granted to Lender hereunder if it shall determine not to do so, regardless of
the fact that notice of sale of the Pledged Collateral and the other rights
granted to Lender hereunder may have been given. Lender may, without notice or
publication, adjourn any public or private sale or cause the same to be
adjourned from time to time by announcement at the time and place fixed for
sale, and such sale may, without further notice, be made at the time and place
to which the same was so adjourned. In case the sale of all or any part of the
Pledged Collateral and the other rights granted to Lender hereunder is made on
credit or for future delivery, the Pledged Collateral and the other rights
granted to Lender hereunder so sold shall be retained by Lender until the sale
price is paid by the purchaser or purchasers thereof. Lender shall not incur any
liability in case any such purchaser or purchasers shall fail to take up and pay
for the Pledged Collateral and the other rights granted to Lender hereunder so
sold and, in case of any such failure, the Pledged Collateral and the other
rights granted to Lender hereunder may be sold again upon like notice. Pledgor
hereby waives all rights of marshaling the Pledged Collateral and any other
security at any time held by Lender and any right of valuation or appraisal.
Lender shall apply the net proceeds of any such collection, recovery, receipt,
appropriation, realization or sale, after deducting all reasonable costs and
expenses of every kind incurred therein or incidental to the care, safekeeping
or otherwise of any and all of the Pledged Collateral and the other rights
granted to Lender hereunder or in any way relating to the rights of Lender
hereunder, including, without limitation, reasonable attorney's fees and legal
expenses, to the payment in whole or in part, of the Obligations together with
interest thereon at the Default Rate, and only after so applying such net
proceeds and after the payment by Lender of any other amount required by any
provision of law, including, without limitation, the Uniform Commercial Code,
need Lender account for the surplus, if any, to Pledgor. Pledgor agrees that
Lender need not give more than ten (10) days notice of the time and place of any
public sale or of the time and place if any private sale or other intended
disposition is to take place and that such notice is commercially reasonable
notification of such matters. No notification need be given to Pledgor if any
has, after default or otherwise, signed a statement renouncing or modifying any
right to notification of sale or other intended disposition. Lender's rights and
remedies hereunder are cumulative, at law or in equity, with any and all of
Lender's other rights in connection with the Loan and Lender may exercise any of
such rights or remedies in any order. In addition to the rights and remedies
granted to it in this Agreement and any other instrument securing, evidencing or
relating to any of the Obligations, Lender shall have all the rights and
remedies of a secured party under the Uniform Commercial Code.
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10. Right to Become a Member. In addition to the remedies set forth in Section 9
hereof, upon the occurrence of an Event of Default, to the extent permitted by
applicable law, Lender may, by delivering written notice to Camp Hill and to
Pledgor, succeed, or designate one or more nominees(s) to succeed, to all right,
title and interest of Pledgor (including, without limitation, the right, if any,
to vote on or take any action with respect to company matters, as a member of
Camp Hill). Pledgor hereby irrevocably authorizes and directs Camp Hill on
receipt of any such notice (a) to deem and treat Lender or such nominee in all
respects as a member (and not merely as an assignee of a member) of Camp Hill
entitled to exercise all the rights, powers and privileges (including, without
limitation, the right to vote on or take any action with respect to company
matters pursuant to the Camp Hill Certificate of Formation or Camp Hill
Operating Agreement, to receive all Distributions, to be credited with the
members equity attributable to the Pledged Collateral as is pledged hereby and
to have all other rights, powers and privileges appertaining to such interests
to which Pledgor would have been entitled had any such membership interest not
been transferred to Lender or such nominees(s), and (b) to (i) file an amended
Camp Hill Certificate of Formation and/or to amend the Camp Hill Operating
Agreement, and/or (ii) execute resolutions and/or consents providing for the
issuance of membership interests to Lender or such nominee(s) as a member of
Camp Hill in place of Pledgor, all in accordance with the applicable Consent.
11. Representations, Warranties and Covenants of Pledgor. Pledgor hereby
represents and warrants to and covenants and agrees with Lender with respect to
Pledgor and the Pledged Collateral that:
(a) Pledgor has all requisite power and authority to execute, deliver and
perform this Agreement and to consummate the transactions contemplated hereby.
(b) This Agreement has been duly authorized, executed and delivered by Pledgor,
is the legal, valid and binding obligation of Pledgor, and is enforceable in
accordance with its terms, subject, however, to bankruptcy, insolvency and other
rights of creditors generally.
(c) The execution, delivery, observance and performance by Pledgor of this
Agreement and the transactions contemplated hereby will not result in any
violation of either or both of the Certificates of Formation, either or both of
the Operating Agreements or of any applicable constitutional provision, law,
statute, ordinance, rule or regulation, or of any judgment, decree or order
applicable to Pledgor and will not conflict with, or cause a breach of, or
default under, any agreement or other document to which Pledgor, Holdings, Camp
Hill or any Affiliate of either of them is a party or, except for the liens
created or contemplated hereby, result in the creation of any mortgage, lien,
pledge, charge or encumbrance upon any of Pledgor's, Holdings' or Camp Hill's or
any of their Affiliates' properties or assets.
(d) It is not necessary for Pledgor, Holdings, Camp Hill or any of their
Affiliates to obtain or make any (1) governmental consent, approval or
authorization, registration or filing (except for appropriate UCC financing
statements) from or with any governmental authorities or (ii) consent, approval,
waiver or notification of partners, lenders, mortgagees, creditors, lessors or
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other nongovernmental persons, in each case, in connection with the execution
and delivery of this Agreement or the consummation of the transactions herein
presently contemplated which has not been obtained.
(e) Pledgor is as of the date hereof (i) the sole equity member of Holdings,
(ii) the sole member of Camp Hill and (iii) the sole owner of the Pledged
Collateral. Pledgor owns the Pledged Collateral, and the Pledged Collateral is
and shall remain, free and clear of any lien, mortgage, encumbrance, charge,
pledge, security interest, or claim of any kind (including, without limitation,
any unconditional sale or other title retention agreement) other than as created
by this Agreement or the other Loan Documents.
(f) This Agreement, together with the filing of necessary UCC financing
statements in the appropriate jurisdiction in each state where Pledgor resides
or has its principal office, as the case may be, creates a perfected first
priority, continuing security interest of Lender in the Pledged Collateral,
except to the extent of Pledged Collateral in the form of cash.
(g) Pledgor covenants and agrees that Pledgor shall defend, at Pledgor's sole
cost and expense, Lender's right, title and Security Interest in and to the
Pledged Collateral, created pursuant hereto, against the claims and demands of
all persons whomsoever.
12. No Disposition. Pledgor agrees that, except as permitted under the Loan
Agreement, without the prior written consent of Lender, Pledgor shall not sell,
assign, transfer, exchange, encumber or otherwise dispose of, or grant any
option with respect to, the Pledged Collateral, nor shall it create, incur or
permit to exist any security interest with respect to any of the Pledged
Collateral, or any interest therein, or any proceeds thereof, except for the
Security Interest provided for by this Agreement.
13. Other Members Shall Join. Every member hereinafter admitted to Holdings
and/or Camp Hill, as applicable, as a successor or additional member shall, as a
condition thereto, join in this Agreement and agrees to be bound by the terms
and provisions hereof, pursuant to a written joinder and assumption agreement in
form and substance satisfactory to Lender, and execute and deliver appropriate
forms of assignment, UCC financing statements, and other appropriate instruments
indicating the Security Interest of Lender in such member's portion of the
Pledged Collateral. The failure of any new member to execute and deliver the
same prior to its admission as a member in Holdings and/or Camp Hill, as
applicable, shall constitute an Event of Default under the terms and provisions
of the Loan Documents.
14. Assignment; Participation.
(a) Lender may assign any or all of its right, title and interest in and to the
Obligations and may transfer therewith any and all its right, title and interest
in and to the Pledged Collateral and the other rights granted to Lender
hereunder therefor and the transferee shall have the same right with respect
thereto as has Lender. Upon such transfer, Lender shall be released and fully
discharged from all liability and responsibility for the Distributions and the
other rights granted to Lender hereunder so transferred.
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(b) Lender may from time to time sell or otherwise grant participations in any
of the Obligations and the holder of any such participation shall, subject to
the terms of any agreement between Lender and such holder, be entitled to the
same benefits as Lender with respect to any of the Pledged Collateral and the
other rights granted to Lender hereunder for the Obligations in which such
holder is a participant.
15. Reimbursement of Lender.
(a) Pledgor hereby agrees to indemnify and hold harmless Lender (to the full
extent permitted by law) from and against any and all claims, demands, losses,
judgments and liabilities (including, without limitation, liabilities for
penalties) of whatever nature arising out of or in connection with this
Agreement or the administration or enforcement of any right or remedy granted to
Lender hereunder, except and to the limited extent that any such claims,
demands, losses, judgments, and liabilities are determined by a final
nonappealable judgment of a court of competent jurisdiction to have been caused
solely by Lender's gross negligence or willful misconduct. Any amounts which may
become payable by Pledgor pursuant to the foregoing indemnity shall be added to
its obligations hereunder and to the Obligations. In no event shall Lender be
liable to Pledgor for any matter or thing in connection with this Agreement
other than to account for moneys actually received by Lender in accordance with
the terms hereof.
(b) If Pledgor shall fail to do any act or thing which Pledgor has covenanted
to do hereunder or if any representation or warranty of Pledgor shall be
breached, Lender may (but shall not be obligated to) do the same or cause it to
be done or remedy any such breach and there shall be added to the obligations
hereunder and to the Obligations the reasonable cost or expense incurred by
Lender in so doing.
(c) Pledgor shall be liable for any and all costs incurred by Lender in taking
any action pursuant to this Agreement against Pledgor or to enforce any of
Lender's rights hereunder against Pledgor and all such costs and expenses,
including, without limitation, reasonable attorneys' fees, expenses and
disbursements, shall be repayable to Lender upon its demand therefor and shall
bear interest from the date advanced to the date of repayment at the Default
Rate, which costs and expenses shall be added to the obligations hereunder and
to the Obligations.
(c) All indemnities and agreements contained in this Section 14 shall survive
the expiration or termination of this Agreement, subject only to the provisions
of Section 15 hereof.
16. No Waiver of Rights by Lender. Nothing herein shall be deemed (a) to be a
waiver of any right which Lender may have under the Bankruptcy Code or the
bankruptcy laws of any State to file a claim for the then outstanding amount of
the Loan or to require that all of the Pledged Collateral shall continue to
secure all of the Obligations, (b) to impair the validity of the Loan, the Loan
Agreement, the Note or any other Loan Document or other document or instrument
delivered to Lender in connection therewith, or (c) to impair the right of
Lender to commence an action to foreclose any lien or security interest. Nothing
herein shall be deemed to be a waiver of any right which Lender may have under
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Section 506(a), 506(b), 1111(b) or any other provisions of the Bankruptcy Code
to file a claim for the full amount of the indebtedness of the Loan and other
amounts due under this Agreement, the Loan Agreement, the Note or the other Loan
Documents or to require that all of the Pledged Collateral shall continue to
secure the Obligations.
17. Further Assurances. Pledgor agrees that at any time and from time to time
upon the written request of Lender, Pledgor shall execute and deliver such
further documents and do such further acts and things at Pledgor's cost and
expense as Lender may reasonably request in order to effectuate the intent and
purposes of this Agreement.
18. Severability. Any provision of this Agreement which is prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
to the extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.
18. No Waiver; Cumulative Remedies. Lender shall not by any act, delay, omission
or otherwise be deemed to have waived any of its rights or remedies hereunder
and no waiver shall be valid unless in writing and signed by Lender, and then
only to the extent therein set forth. A waiver by Lender of any right or remedy
hereunder on any one occasion shall not be construed as a bar to any right or
remedy which Lender would otherwise have on any future occasion. Neither any
failure to exercise nor any delay in exercising on the part of Lender any right,
power or privilege hereunder, shall operate as a waiver thereof, nor shall any
single or partial exercise of any right, under this Agreement or an related
document preclude any other or further exercise thereof or the exercise of any
other right. The rights and remedies herein provided are cumulative and may be
exercised singly or concurrently, and are not exclusive of any rights or
remedies provided by law.
19. Waivers, Assignments; Integration. None of the terms or provisions of this
Agreement may be waived, altered, modified or amended except by an instrument in
writing duly executed by Lender and Pledgor. This Agreement and all obligations,
rights and remedies of Pledgor hereunder shall inure to the benefit of and be
binding upon Pledgor and its respective permitted successors, transferees and
assigns. This Agreement and all the rights and remedies of Lender hereunder
shall inure to the benefit of and be binding upon Lender, and its respective
successors, endorsers, participants, transferees and assigns. This Agreement
constitutes the entire agreement among the parties hereto with respect to the
subject matter hereof and supersedes all prior agreements, understandings and
representations of the parties relating thereto. Lender shall have no duty or
liability to preserve the Distributions or any rights pertaining thereto.
21. Notices. Whenever it is provided herein that any notice, demand, request,
consent, approval, declaration or other communication shall or may be given to
or served upon any of the parties to this Agreement by any of the other, or
whenever any of the parties hereto desires to give or serve upon any other any
communications with respect to this Agreement, each such notice, demand,
request, consent, approval, declaration or other communication shall be in
writing, and shall be deemed to have been duly given only (a) when delivered, if
sent by registered or certified mail (return receipt requested), (b) when
delivered, if delivered personally, (c) when transmitted, if sent by facsimile
if a confirmation of transmission is produced by the sending machine (and a copy
of each facsimile is promptly sent by any of the other methods for giving notice
hereunder) or (d) on the following Business Day, if sent by overnight mail or
reputable overnight courier, in each case to the parties at the following
addresses or facsimile numbers:
11
(a) if to Lender:
SWH Funding Corp.
Xxx Xxxxxxxxxx Xxxxx
Xxxxxxxxxx, Xxx Xxxxxx 00000
Attention: Xxxxxxx X. Xxxxxxx
Facsimile: (000) 000-0000
with a copy to:
Solomon and Xxxxxxxx LLP
000 Xxxxx Xxxxxx
00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxx Xxxxx, Esq.
Facsimile: (000) 000-0000
(b) if to Pledgor:
Cedar Income Fund Partnership, L.P.
c/o Cedar Bay Realty Advisors, Inc.
00 Xxxxx Xxxxxx Xxxxxx, Xxxxx 000
Xxxx Xxxxxxxxxx, Xxx Xxxx 00000
Attention: Xxxxxx X. Xxxxxx
Facsimile: (000) 000-0000
with a copy to:
Cedar Bay Realty Advisors, Inc.
00 Xxxxx Xxxxxx Xxxxxx, Xxxxx 000
Xxxx Xxxxxxxxxx, Xxx Xxxx 00000
Attention: Xxxxxx X. Xxxxxxxx, Esq.
Facsimile: (000) 000-0000
or at such other address or facsimile number as may be substituted by notice
given as herein provided. The giving of any notice required hereunder may be
waived in writing by the party entitled to receive such notice. Failure or delay
in delivering copies of any notice, demand, request, consent, approval,
declaration or other communication within any corporation or firm to the persons
designated to receive copies shall in no way adversely affect the effectiveness
of such notice, demand, request, consent, approval, declaration or other
communication. The parties agree that their respective counsel shall be
authorized to serve notices on behalf of such parties.
12
22. Power of Attorney. Pledgor hereby appoints Lender as its attorney-in-fact
to execute and file, effective upon the occurrence of any Event of Default
hereunder, on the behalf of Pledgor, any financing statements, continuation
statements or other documentation required to perfect or continue the security
interest created hereby. This power, being coupled with an interest, shall be
irrevocable until all amounts and other obligations secured hereby have been
paid, satisfied and discharged in full. Pledgor acknowledges and agrees that the
exercise by Lender of its rights under this Section 22 shall not be deemed a
satisfaction of the amounts owed Lender unless Lender so elects in writing.
23. Counterparts. This Agreement may be executed in any number of counterparts
with the same effect as if all parties hereto executed the same document. All
such counterparts shall be construed together and shall constitute one
instrument, but in making proof hereof it shall only be necessary to produce one
such counterpart.
24. Governing Law; Jurisdiction; Venue; Service of Process.
(a) THIS AGREEMENT WAS NEGOTIATED, EXECUTED AND DELIVERED IN THE STATE OF NEW
YORK. THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER
SHALL IN ALL RESPECTS BE GOVERNED BY, AND CONSTRUED AND ENFORCED IN ACCORDANCE
WITH, THE LAWS OF THE STATE OF NEW YORK WITHOUT GIVING EFFECT TO THE STATE OF
NEW YORK'S PRINCIPLES OF CONFLICTS OF LAW, EXCEPT THAT IT IS THE INTENT AND
PURPOSE OF LENDER AND PLEDGOR THAT THE PROVISIONS OF SECTION 5-1401 OF THE
GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK SHALL APPLY TO THIS AGREEMENT.
(b) ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT SHALL BE
BROUGHT, AT LENDER'S OPTION, IN XXX XXXXXX XX XXX XXXXX XX XXX XXXX, XXX XXXX
XXXXXX OR OF THE UNITED STATES OF AMERICA FOR THE SOUTHERN DISTRICT OF NEW YORK
EXCEPT SUCH ACTIONS OR PROCEEDINGS ARE REQUIRED TO BE BROUGHT IN ANOTHER COURT
TO OBTAIN SUBJECT MATTER JURISDICTION OVER THE MATTER IN CONTROVERSY. PLEDGOR
HEREBY ACCEPTS FOR ITSELF AND IN RESPECT OF ITS PROPERTY, GENERALLY AND
UNCONDITIONALLY, THE NON-EXCLUSIVE JURISDICTION OF THE AFORESAID COURTS.
PLEDGOR IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS OUT OF ANY OF THE
AFOREMENTIONED COURTS IN ANY SUCH ACTION OR PROCEEDING BY THE MAILING OF COPIES
THEREOF BY REGISTERED OR CERTIFIED MAIL, POSTAGE PREPAID, TO PLEDGOR AT
PLEDGOR'S ADDRESS SET FORTH IN THE INTRODUCTORY PARAGRAPH HEREOF, WHICH SERVICE
SHALL BE DEEMED SUFFICIENT FOR PERSONAL JURISDICTION AND SHALL BE DEEMED
EFFECTIVE SEVEN (7) DAYS AFTER MAILING. PLEDGOR HEREBY IRREVOCABLY WAIVES ANY
OBJECTION WHICH IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY OF
THE AFORESAID ACTIONS OR PROCEEDINGS ARISING OUT OF OR IN CONNECTION WITH THIS
AGREEMENT BROUGHT IN THE COURTS REFERRED TO ABOVE AND HEREBY FURTHER IRREVOCABLY
WAIVES AND AGREES NOT TO PLEAD OR CLAIM IN ANY SUCH COURT THAT ANY SUCH ACTION
OR PROCEEDING BROUGHT IN ANY SUCH COURT HAS BEEN BROUGHT IN AN INCONVENIENT
FORUM. NOTHING CONTAINED HEREIN SHALL AFFECT THE RIGHT OF LENDER TO SERVE
PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR TO COMMENCE LEGAL PROCEEDINGS OR
OTHERWISE PROCEED AGAINST PLEDGOR IN ANY OTHER JURISDICTION.
13
(e) PLEDGOR HEREBY EXPRESSLY AND UNCONDITIONALLY WAIVES, IN CONNECTION WITH ANY
SUIT, ACTION OR PROCEEDING BROUGHT BY LENDER UNDER THIS AGREEMENT ANY AND EVERY
RIGHT PLEDGOR MAY HAVE TO (A) A TRIAL BY JURY, (B) INTERPOSE ANY COUNTERCLAIM
THEREIN (EXCEPT FOR ANY COMPULSORY COUNTERCLAIM WHICH, IF NOT ASSERTED IN SUCH
PROCEEDING, WOULD BE WAIVED) AND (C) HAVE THE SAME CONSOLIDATED WITH ANY OTHER
OR SEPARATE SUIT, ACTION OR PROCEEDING.
[SIGNATURE PAGE FOLLOWS]
14
IN WITNESS WHEREOF, Pledgor has executed and delivered this Agreement as of the
date first above written.
CEDAR INCOME FUND PARTNERSHIP, L.P.,
a Delaware limited partnership
By: Cedar Income Fund, Ltd.,
a Maryland corporation,
General Partner
By:
---------------------------------
Name: Xxx X. Xxxxxx
Title: President
ACCEPTED AND AGREED TO
THIS 22 DAY OF NOVEMBER, 2002:
CEDAR CENTER HOLDINGS, L.L.C. 3,
a Delaware limited liability company
By: Cedar Income Fund Partnership, L.P.,
a Delaware limited partnership,
Managing Member
By: Cedar Income Fund, Ltd.,
a Maryland corporation,
General Partner
By:
----------------------------------
Name: Xxx X. Xxxxxx
Title: President
[SIGNATURE PAGE CONTINUED ON FOLLOWING PAGE]
15
CEDAR CAMP HILL LLC,
a Delaware limited liability company,
By: Cedar Income Fund Partnership, L.P.,
a Delaware limited partnership,
Managing Member
By: Cedar Income Fund, Ltd.,
a Maryland corporation,
General Partner
By:
-------------------------------------------------
Name: Xxx X. Xxxxxx
Title: President
ACKNOWLEDGMENT
Within New York:
STATE OF NEW YORK )
) SS.:
COUNTY OF NEW YORK )
On the 20 day of November in the year 2002, before me, the undersigned, a Notary
Public in and for said State, personally appeared Xxx X. Xxxxxx, personally
known to me or proved to me on the basis of satisfactory evidence to be the
individual whose name is subscribed to the within instrument and acknowledged to
me that he executed the same in his capacity, and that by his signature on the
instrument, the individual, or the person upon behalf of which the individual
acted, executed the instrument.
Notary Public
Xxxxxxx X. Xxxxxxx
Notary Public, State of New York
No. 01G05077989
Qualified In New York County Commission Expires May 19, 2003
Outside New York:
STATE OF )
) SS.:
COUNTY OF )
On the day of November in the year 2002, before me, the undersigned, a
Notary Public in and for said State, personally appeared
personally known to me or proved to me on the basis of satisfactory evidence to
be the individual whose name is subscribed to the within instrument and
acknowledged to me that she/he executed the same in her/his capacity, and that
by her/his signature on the instrument, the individual, or the person upon
behalf of which the individual acted, executed the instrument, and that such
individual made such appearance before the undersigned in the
Notary Public (SEAL)
16
ACKNOWLEDGMENT
Within New York:
STATE OF NEW YORK )
) SS.:
COUNTY NEW YORK )
On the 20 day of November in the year 2002, before me, the undersigned, a Notary
Public in and for said State, personally appeared Xxx X. Xxxxxx, personally
known to me or proved to me on the basis of satisfactory evidence to be the
individual whose name is subscribed to the within instrument and acknowledged to
me that he executed the same in his capacity, and that by his signature on the
instrument, the individual, or the person upon behalf of which the individual
acted, executed the instrument.
Notary Public
Xxxxxxx X. Xxxxxxx
Notary Public, State of New York
No. 01G05077989
Qualified In New York County Commission Expires May 19, 2003
Outside New York:
STATE OF )
) SS.:
COUNTY OF )
On the day of November in the year 2002, before me, the undersigned, a Notary
Public in and for said State, personally appeared
personally known to me or proved to me on the basis of satisfactory evidence to
be the individual whose name is subscribed to the within instrument and
acknowledged to me that she/he executed the same in her/his capacity, and that
by her/his signature on the instrument, the individual, or the person upon
behalf of which the individual acted, executed the instrument, and that such
individual made such appearance before the undersigned in the
Notary Public (SEAL)
17
ACKNOWLEDGMENT
Within New York:
STATE OF NEW YORK )
) SS.:
COUNTY OF NEW YORK )
On the 20 day of November in the year 2002, before me, the undersigned, a Notary
Public in and for said State, personally appeared Xxx X. Xxxxxx, personally
known to me or proved to me on the basis of satisfactory evidence to be the
individual whose name is subscribed to the within instrument and acknowledged t6
me that he executed the same in his capacity, and that by his signature on the
instrument, the individual, or the person upon behalf of which the individual
acted, executed the instrument.
Notary Public
Xxxxxxx X. Xxxxxxx
Notary Public, State of New York
No. 01G05077989
Qualified In New York County Commission Expires May 19, 2003
Outside New York:
STATE OF )
) SS.:
COUNTYOF NEW YORK )
On the day of November in the year 2002, before me, the undersigned, a Notary
Public in and for said State, personally appeared
personally known to me or proved to me on the basis of satisfactory evidence to
be the individual whose name is subscribed to the within instrument and
acknowledged to me that she/he executed the same in her/his capacity, and that
by her/his signature on the instrument, the individual, or the person upon
behalf of which the individual acted, executed the instrument, and that such
individual made such appearance before the undersigned in the
Notary Public (SEAL)
18
EXHIBIT A
FORM OF AGREEMENT AND ACKNOWLEDGMENT OF PLEDGE HOLDINGS AGREEMENT AND
ACKNOWLEDGMENT OF PLEDGE
The undersigned hereby agrees, acknowledges and consents as of the day of
November, 2002, to the execution and delivery to SWH FUNDING CORP., a New Jersey
corporation (together with its successors, assigns and participants, "Lender"),
of that certain Pledge and Security Agreement by CEDAR INCOME FUND PARTNERSHIP,
L.P., a Delaware limited partnership ("Pledgor"), as of even date herewith (the
"Pledge"), as collateral security for the payment and performance of the
Obligations (as defined in the Pledge) under the Pledgor Guaranty (as defined in
the Pledge), and the assignment and pledge under the Pledge to Lender by Pledgor
of all of its right, title and interest in and to the Pledged Collateral (as
defined in the Pledge) which includes, inter ail, the Holdings Collateral (as
defined in the Pledge). All capitalized terms used herein, but not otherwise
defined herein, shall have the meanings ascribed to such terms in the Pledge.
The undersigned shall cause all of its books and records to reflect the pledge
by Pledgor of the Holdings Collateral to Lender and agrees not to consent to or
to permit any transfer of the Holdings Collateral or any other action that may
be taken by Pledgor that might constitute a breach of any term or condition of
the Pledge or any Event of Default so long as any Obligations remain
outstanding, except in accordance with and subject to the terms and conditions
of the Pledge. The undersigned represents and warrants that (a) the execution
and delivery of the Pledge does not violate any of the undersigned's
organizational documents or any other agreement to which the undersigned is a
party or by which any of the property of the undersigned is bound, (b) Pledgor's
ownership interest in the undersigned is as set forth in the Pledge and such
ownership interest in the undersigned is not subject to any claim, lien or
encumbrance whatsoever of any kind or nature, and (c) the undersigned does not
have any claim, right of offset, or counterclaim against Pledgor or with respect
to the Holdings Collateral or otherwise under any of the undersigned's
organizational documents, and Pledgor is not in default to the undersigned or
otherwise under or in respect of any of its obligations under any of the
undersigned's organizational documents. The undersigned agrees that Lender
and/or its representatives may at any time during reasonable business hours
inspect the books, records and properties of the undersigned, and the
undersigned shall, so long as any Obligations remain outstanding, at least five
(5) Business Days prior to the time any Holdings Collateral are proposed to be
made, give written notice thereof to Lender as provided in the Pledge.
Notwithstanding the security interests of Lender in the Holdings Collateral,
Lender shall have no obligation or liability whatsoever to the undersigned, or
any member thereof, or any creditor or other person having any relationship,
contractual or otherwise, with the undersigned, nor shall Lender be obligated to
perform any of the obligations or duties of Pledgor under any of the
undersigned's organizational documents, or to take any action to collect or
enforce any claim for payment due Pledgor arising thereunder. The undersigned
A-1
acknowledges that the security interests of Lender in the Holdings Collateral
and all of Lender's rights and remedies under the Pledge may be transferred or
assigned by Lender to the extent permitted by the Pledge. In the event of any
such transfer or assignment, all of the provisions of this Agreement and
Acknowledgment of Pledge shall inure to the benefit of the transferees,
successors, assigns and/or participants of Lender. The provisions of this
Agreement and Acknowledgment of Pledge shall likewise be binding upon any and
all permitted successors and/or assigns of the undersigned.
The undersigned hereby agrees that it shall comply with all written instructions
originated by Lender concerning the Holdings Collateral and the rights of Lender
granted under the Pledge, in accordance with the Pledge, without further consent
of Pledgor and that, during the existence of an Event of Default, (a) all
Distributions with respect to the Holdings Collateral will be paid directly to
Lender until the Obligations have been paid and/or satisfied in full, (b) Lender
shall have the sole and exclusive right to exercise all powers of ownership
pertaining to such Holdings Collateral and the rights of Lender granted under
the Pledge and (c) Lender may take any reasonable action which Lender may deem
necessary for the maintenance, preservation and protection of any of the
Holdings Collateral and the rights of Lender granted under the Pledge or
Lender's security interests therein, including, without limitation, the right to
declare any or all Obligations to be immediately due and payable without demand
or notice and the right to transfer any of the Holdings Collateral and the
rights of Lender granted under the Pledge into Lender's name or the name of any
designee or nominee of Lender.
The undersigned shall, from time to time, at the undersigned's expense, promptly
execute and deliver such further instruments, documents and agreements, and
perform such further acts as may be necessary or proper to carry out and effect
the terms of the Pledge and this Agreement and Acknowledgment of Pledge.
This Agreement and Acknowledgment of Pledge shall constitute a "control
agreement" under the revised Article 9 of the Uniform Commercial Code and is
being given to induce Lender to accept the Pledge and to make the Loan and with
the understanding that Lender will rely hereon. This Agreement and
Acknowledgment of Pledge is being given to induce Lender to accept the Pledge
and to make the Loan and with the understanding that Lender will rely hereon.
[SIGNATURE PAGE FOLLOWS]
A-2
IN WITNESS WHEREOF, the undersigned has caused this Agreement and Acknowledgment
of Pledge to be duly executed and delivered as of the date first above written.
CEDAR CENTER HOLDINGS, L.L.C. 3,
a Delaware limited liability company
By: Cedar Income Fund Partnership, L.P.,
a Delaware limited partnership,
Managing Member
By: Cedar Income Fund, Ltd.,
a Maryland corporation,
General Partner
By:
---------------------------------------
Name:
Title:
A-3
PI
EXHIBIT B FORM OF AGREEMENT AND ACKNOWLEDGMENT OF PLEDGE CAMP HILL AGREEMENT AND
ACKNOWLEDGMENT OF PLEDGE
The undersigned hereby agrees, acknowledges and consents as of the day of
November, 2002, to the execution and delivery to SWH FUNDING CORP., a New Jersey
corporation (together with its successors, assigns and participants, "Lender"),
of that certain Pledge and Security Agreement by CEDAR INCOME FUND PARTNERSHIP,
L.P., a Delaware limited partnership ("Pledgor"), as of even date herewith (the
"Pledge"), as collateral security for the payment and performance of the
Obligations (as defined in the Pledge) under the Pledgor Guaranty (as defined in
the Pledge), and the assignment and pledge under the Pledge to Lender by Pledgor
of all of its right, title and interest in and to the Pledged Collateral (as
defined in the Pledge) including, inter ail, the Camp Hill Collateral (as
defined in the Pledge). All capitalized terms used herein, but not otherwise
defined herein, shall have the meanings ascribed to such terms in the Pledge.
The undersigned shall cause all of its books and records to reflect the pledge
by Pledgor of the Camp Hill Collateral to Lender and agrees not to consent to or
to permit any transfer of the Camp Hill Collateral or any other action that may
be taken by Pledgor that might constitute a breach of any tenon or condition of
the Pledge or any Event of Default so long as any Obligations remain
outstanding, except in accordance with and subject to the terms and conditions
of the Pledge. The undersigned represents and warrants that (a) the execution
and delivery of the Pledge does not violate any of the undersigned's
organizational documents or any other agreement to which the undersigned is a
party or by which any of the property of the undersigned is bound, (b) Pledgor's
ownership interest in the undersigned is as set forth in the Pledge and such
ownership interest in the undersigned is not subject to any claim, lien or
encumbrance whatsoever of any kind or nature, and (c) the undersigned does not
have any claim, right of offset, or counterclaim against Pledgor or with respect
to the Camp Hill Collateral or otherwise under any of the undersigned's
organizational documents, and Pledgor is not in default to the undersigned or
otherwise under or in respect of any of its obligations under any of the
undersigned's organizational documents. The undersigned agrees that Lender
and/or its representatives may at any time during reasonable business hours
inspect the books, records and properties of the undersigned, and the
undersigned shall, so long as any Obligations remain outstanding, at least five
(5) Business Days prior to the time any Camp Hill Collateral are proposed to be
made, give written notice thereof to Lender as provided in the Pledge.
Notwithstanding the security interests of Lender in the Camp Hill Collateral,
Lender shall have no obligation or liability whatsoever to the undersigned, or
any member thereof, or any creditor or other person having any relationship,
contractual or otherwise, with the undersigned, nor shall Lender be obligated to
B-1
perform any of the obligations or duties of Pledgor under any of the
undersigned's organizational documents, or to take any action to collect or
enforce any claim for payment due Pledgor arising thereunder. The undersigned
acknowledges that the security interests of Lender in the Camp Hill Collateral
and all of Lender's rights and remedies under the Pledge may be transferred or
assigned by Lender to the extent permitted by the Pledge. In the event of any
such transfer or assignment, all of the provisions of this Agreement and
Acknowledgment of Pledge shall inure to the benefit of the transferees,
successors, assigns and/or participants of Lender. The provisions of this
Agreement and Acknowledgment of Pledge shall likewise be binding upon any and
all permitted successors and/or assigns of the undersigned. The undersigned
hereby agrees that it shall comply with all written instructions originated by
Lender concerning the Camp Hill Collateral and the rights of Lender granted
under the Pledge, in accordance with the Pledge, without further consent of
Pledgor and that, during the existence of an Event of Default, (a) all
Distributions with respect to the Camp Hill Collateral will be paid directly to
Lender until the Obligations have been paid and/or satisfied in full, (b) Lender
shall have the sole and exclusive right to exercise all powers of ownership
pertaining to such Camp Hill Collateral and the rights of Lender granted under
the Pledge and (c) Lender may take any reasonable action which Lender may deem
necessary for the maintenance, preservation and protection of any of the Camp
Hill Collateral and the rights of Lender granted under the Pledge or Lender's
security interests therein, including, without limitation, the right to declare
any or all Obligations to be immediately due and payable without demand or
notice and the right to transfer any of the Camp Hill. Collateral and the rights
of Lender granted under the Pledge into Lender's name or the name of any
designee or nominee of Lender.
The undersigned shall, from time to time, at the undersigned's expense, promptly
execute and deliver such further instruments, documents and agreements, and
perform such further acts as may be necessary or proper to carry out and effect
the terms of the Pledge and this Agreement and Acknowledgment of Pledge.
This Agreement and Acknowledgment of Pledge shall constitute a "control
agreement" under the revised Article 9 of the Uniform Commercial Code and is
being given to induce Lender to accept the Pledge and to make the Loan and with
the understanding that Lender will rely hereon. This Agreement and
Acknowledgment of Pledge is being given to induce Lender to accept the Pledge
and to make the Loan and with the understanding that Lender will rely hereon.
[SIGNATURE PAGE FOLLOWS]
B-2
IN WITNESS WHEREOF, the undersigned has caused this Agreement and Acknowledgment
of Pledge to be duly executed and delivered as of the date first above written.
CEDAR CAMP HILL LLC,
a Delaware limited liability company,
By: Cedar Income Fund Partnership, L.P.,
a Delaware limited partnership,
Managing Member
By: Cedar Income Fund, Ltd.,
a Maryland corporation,
General Partner
By:
----------------------------------------
Name:
Title:
B-3
