Exhibit 99.12
November 19, 2001
Cadim Acquisition, LLC
c/o Mayer, Xxxxx & Xxxxx
000 Xxxxx XxXxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxxxx X. Xxxxxxxxxx
or Xxxx X. Xxxxxx
Facsimile: (000) 000-0000
Cadim inc.
000, Xxxxxx Xxxxxxxx, Xxxxxx 0000
Case Postale 000
Xxxxxxxx, Xxxxxx X0X 0X0
Attention: Xxxxxxx Xxxxxxxxx
Facsimile: (000) 000-0000
Re: Purchase and Sale of Loan Participation among Vornado
PS, L.L.C., a Delaware limited liability company (the
"Lender"), Vornado Realty L.P. ("VRLP"), Cadim
Acquisition, LLC, a Delaware limited liability
company (the "Participant"), and Cadim inc., a
company incorporated under the laws of Quebec
("Cadim").
Gentlemen/Ladies:
Reference is made to that certain Loan Agreement, dated as of
September 26, 2000 (the "Vornado Loan Agreement"), among Primestone Investment
Partners L.P., as Borrower (the "Borrower"), The Prime Group, Inc., Prime Group
Limited Partnership, PGLP, Inc., Prime Group II, L.P. and Prime International,
Inc. (collectively, the "Guarantors"), Xxxxxxx X. Xxxxxxx ("Xxxxxxx") and the
Lender and to the note, dated as of September 26, 2000, in the original
principal amount of $62,000,000 (the "Vornado Note") made by the Borrower to the
Lender. The Vornado Note is secured by a security interest in 7,944,893 units
representing common limited partnership interests in Prime Group Realty, L.P., a
Delaware limited partnership (the "Operating Partnership"), granted by the
Borrower pursuant to that certain Pledge and Security Agreement, dated as of
September 26, 2000 (the "Vornado Pledge and Security Agreement"), between the
Borrower and the Lender. Capitalized terms used herein which are not defined
herein have the meanings herein ascribed to them in the Vornado Loan Agreement.
The Vornado Loan Agreement, the Vornado Note, the Vornado Pledge and Security
Agreement and all other documents delivered in connection therewith are referred
to herein as the "Vornado Loan Documents" and the indebtedness evidenced
thereby, together with all of the rights of the Lender thereunder, and all the
obligations of the Borrower, Guarantors and Xxxxxxx to Lender in connection
therewith, are referred to herein as the "Vornado Loan".
Reference is also made to that certain Amended and Restated
Credit Agreement, dated as of September 26, 2000, as amended (as so amended, the
"Prudential Loan Agreement"), between Borrower and P-B Finance Ltd. ("Prudential
Lender") and to the note, dated as of November 17, 1997, in the original
principal amount of $40,000,000 (the "Prudential Note") made by the Borrower to
Prudential Securities Credit Corporation and indorsed to the Lender. The
Prudential Note is secured by a security interest in 7,944,893 Prime OP Units,
granted by the Borrower pursuant to that certain Amended and Restated Pledge and
Security Agreement, dated as of September 26, 2000, as amended (as so amended,
the "Prudential Pledge and Security Agreement"), between the Borrower and the
Prudential Lender. The Prudential Loan Agreement, the Prudential Note, the
Prudential Pledge and Security Agreement and all other documents delivered in
connection therewith are referred to herein as the "Prudential Loan Documents"
and the indebtedness evidenced thereby, together with all of the rights of
Lender thereunder, and all the obligations of the Borrower, Guarantors and
Xxxxxxx to Lender in connection therewith, are referred to herein as the
"Prudential Loan". All right, title and interest of the Prudential Lender under
the Prudential Loan was sold and assigned to Lender pursuant to that certain
Assignment of Loan and Loan Documents, dated as of October 31, 2001 (the
"Prudential Loan Assignment"). For purposes hereof, all references to the
"Prudential Loan" shall include all rights to indemnification and other
recoveries, if any, in favor of Lender under and pursuant to the Prudential Loan
Assignment.
The Prudential Loan Agreement and the Vornado Loan Agreement
are sometimes collectively referred to herein as the "Loan Agreements"; the
Prudential Loan Documents and the Vornado Loan Documents are sometimes
collectively referred to herein as the "Loan Documents"; the Prudential Note and
the Vornado Note are sometimes collectively referred to herein as the "Notes";
and the Prudential Loan and the Vornado Loan are sometimes collectively referred
to herein as the "Loans".
Lender desires to sell, and the Participant desires to
purchase, an undivided participating interest in the Loans now outstanding under
the Loan Agreements as evidenced by the Notes and the related Loan Documents on
the terms and conditions set forth below and the Participant desires to
contribute to a possible joint effort with Lender with respect to a possible
strategic transaction relating to Prime Group Realty Trust (the "REIT")
(although as of the date hereof there is no agreement between the parties as to
any such joint effort and in the event the parties are unable to reach an
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agreement with respect to any such joint effort neither Lender nor Participant
shall, except as set forth in Section 5(b), owe the other party any obligation
with respect to any such possible joint effort).
1. Purchase and Sale; Closing Date. Subject to the terms and
conditions hereof, the Lender hereby agrees to sell and the Participant agrees
to purchase, without recourse (except as set forth herein), an undivided 50.0%
participating interest (the "Participation") in the Loans. As used herein
"Participant's Share" means 50.0%. Such purchase and sale shall be effected on
November 19, 2001 (the "Closing Date"). Notwithstanding anything contained
herein to the contrary, the Lender and the Participant hereby acknowledge that
the purchase by the Participant of the Participation shall not result in the
Participant acquiring any contractual rights under the Loan Documents or
becoming an obligee under the Loans and that the Lender shall retain all
contractual rights and obligations under all of the Loan Documents.
2. Purchase Price. On the Closing Date, the Participant
shall pay to the Lender FORTY-NINE MILLION, NINE HUNDRED EIGHTY-NINE THOUSAND,
TWO HUNDRED FORTY AND NO/100 DOLLARS ($49,989,240.00) (the "Purchase Price") in
consideration for the Participant's Share of the Loans, including all payments
thereon and all amounts realized or recovered in connection therewith from and
after the date hereof (whether or not such payments relate to the period on,
before or after the date hereof (but subject, in the case of cash payments or
cash recoveries, to distribution in accordance with Section 3 hereof)), and as a
contribution to a possible joint effort with Lender with respect to a possible
strategic transaction relating to the REIT (although as of the date hereof there
is no agreement between the parties as to any such joint effort and in the event
the parties are unable to reach an agreement with respect to any such joint
effort neither Lender nor Participant shall, except as set forth in Section
5(b), owe the other party any obligation with respect to any such possible joint
effort). In addition, the Lender and the Participant hereby agree that within
seven (7) days from the date hereof, the Purchase Price shall be adjusted to
reflect the equal sharing between the Lender and the Participant of the costs
and expenses incurred by the Lender and its affiliates on the one hand (up to a
maximum of Two Million Dollars ($2,000,000)) and the Participant and its
affiliates on the other hand (up to a maximum of Two Million Dollars
($2,000,000)) prior to the date hereof relating to the Loans (in the case of
Lender) and relating to the Loans and the REIT and its assets (in the case of
the Participant). All references to "Dollars" herein shall mean the lawful
currency of the United States of America. Payment of the Purchase Price shall be
made in accordance with Section 9.
3. Distributions of Payments (other than Prime OP Units or
REIT Shares). When, if and to the extent that the Lender hereafter receives (by
payments in the ordinary course, by realization on collateral security, or
otherwise) a payment or prepayment in cash of principal of or interest on the
Loans or any other amounts payable
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by the Borrower pursuant to the Loan Documents or payments in cash in bankruptcy
or any insolvency proceeding, 100% of any such amount received by the Lender
shall be applied in the following order of priority:
(a) first, to the payment of or reimbursement of all
out-of-pocket costs and expenses incurred from and after the date hereof,
including attorneys' fees and disbursements, incurred by or on behalf of the
Lender or Participant (provided that such expenses of the Participant shall have
been reasonably approved by the Lender) in connection with the servicing and
administration of the Loans, including the enforcement of any remedies (and the
cost of the Lender's and Participant's (provided that such costs of the
Participant shall have been reasonably approved by the Lender) investigation of
rights and remedies) as against the Borrower, any of the Guarantors or any other
obligor in respect of the Loans, or any collateral or security given therefor;
provided that neither Cadim nor VRLP shall be entitled to reimbursements of
amounts required to be paid by it pursuant to the indemnification provisions of
Section 7(b) or Section 8(b), respectively; and
(b) second, to the Lender and Participant pro rata in
accordance with their respective "Interest Balance Accounts" until such Interest
Balance Accounts equal zero. On the Closing Date, the Interest Balance Account
of Lender will equal Four Million, Seven Hundred Sixty-Seven Thousand,
Seventy-Nine and No/100 Dollars ($4,767,079.00) and the Interest Balance Account
of Participant will equal Zero Dollars ($0.00). If, after the Closing Date, the
calculation of the foregoing amount of the Lender's Interest Balance Account is
determined to be incorrect, the parties agree that, within seven (7) days of the
Closing Date, the parties will adjust the initial Lender's Interest Balance
Account to reflect the correctly calculated amount of the Lender's Interest
Balance Account as of the Closing Date (and Lender agrees to provide reasonable
"back-up" information to Participant regarding the calculation of the amount of
the Lender's Interest Balance Account set forth above). After the Closing Date
on a daily basis, the Interest Balance Account of the Lender shall be increased
by the sum of (i) 50% of the interest accrued (as provided under the Vornado
Loan Documents or the Prudential Loan Documents, as applicable) on the
outstanding principal balance of the Loans for the immediately preceding day and
(ii) 100% of the interest accrued (as provided under the Vornado Loan Documents
or the Prudential Loan Documents, as applicable) on the amounts comprising the
Lender's Interest Balance Account for the immediately preceding day. After the
Closing Date, the Interest Balance Account of the Participant shall be increased
by the sum of (i) 50% of the interest accrued (as provided under the Vornado
Loan Documents or the Prudential Loan Documents, as applicable) on the
outstanding principal balance of the Loans for the immediately preceding day and
(ii) 100% of the interest accrued (as provided under the Vornado Loan Documents
or the Prudential Loan Documents, as applicable) on the amounts comprising the
Participant's Interest Balance Account for the immediately preceding day. The
Interest Balance Account of each of
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Lender and Participant shall be reduced by each disbursement to it under this
Section 3(b); and
(c) thereafter 50% to Lender and 50% to Participant.
Lender shall pay to the Participant any amounts payable to
the Participant pursuant to the above provisions of this Section 3 not later
than the first (1st) Business Day after receipt of such amounts from the
Borrower, any of the Guarantors or any other entity or person obligated with
respect to the Loans. The application of amounts pursuant to this Section 3
shall be for the benefit of Lender and Participant and shall not, insofar as the
Borrower, Guarantors or other obligors under the Loan Documents are concerned,
affect the Lender's right to apply any amounts received in respect of the Loans
to the Loans in such priority and proportion as Lender shall determine.
Notwithstanding anything herein to the contrary, if the
Lender acquires the Prime OP Units or REIT Shares pledged as collateral for the
Loans on behalf of the Lender and the Participant as the result of a credit bid
in the foreclosure proceedings, such Prime OP Units and/or REIT Shares shall be
distributed 50% to Lender, 50% to Participant as more fully set forth in Section
5(a) hereof and such distribution shall not result in any reduction in the
Interest Balance Account of either Lender or Participant.
4. Lender's Duties; Servicing; Participant's Rights.
(a) Without the prior consent of the Participant, the Lender
shall not (i) give its agreement to any material amendment, waiver or
modification of any Loan Document, including without limitation (A) postponing
any date fixed for payment of any portion of the principal of, or interest on,
the Loans, (B) reducing the principal of, or interest on, the Loans, (C)
releasing any lien or security interest on any collateral or security given for
the Loans or (D) releasing any Guarantor or Xxxxxxx from its or his obligations
regarding the Loans or under any of the Loan Documents, (ii) agree to a plan of
reorganization of the Borrower in any bankruptcy or similar proceeding involving
the Borrower, (iii) post any bond, security or similar payment required to be
posted by a court of competent jurisdiction in connection with a bankruptcy or
similar proceeding involving the Borrower or (iv) enter into any agreement with
Borrower, any Guarantor or Xxxxxxx in which any such entity or person receives a
material benefit with respect to (1) the collateral securing the Loans, (2) the
relationship of any such entity or person with the REIT, the Operating
Partnership or any of their respective subsidiaries or (3) any of the assets of
the REIT, the Operating Partnership or any of their respective subsidiaries.
(b) Lender shall administer and service the Loans with the
same degree of care which an institutional lender normally exercises in
connection with similar loans held by or for the benefit of such lender and any
participants, provided that,
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notwithstanding anything herein that may be construed to the contrary, the
Lender shall not be liable to the Participant with respect to anything which the
Lender or its agents, in the exercise of the Lender's good faith discretion,
does or refrains from doing from and after the date hereof in connection with
the administration or servicing of the Loans, it being agreed, for all purposes
hereunder, that the Lender shall be liable in connection with the administration
and servicing of the Loans (which shall include for all purposes hereunder the
monitoring of the Loans) from and after the date hereof, or its failure to
administer or service the Loans from and after the date hereof, only if and to
the extent the Lender's action or failure to act constituted willful misconduct,
bad faith or gross negligence on the part of the Lender. Without limiting the
foregoing, the Lender may rely (in good faith) upon the advice of counsel,
accountants and other experts, including those retained by Borrower, and upon
any written or oral communication which it believes to be genuine or correct or
to have been signed or made by the proper person, shall not have any obligation
to make any inquiry concerning the performance of the Borrower, any of the
Guarantors or any other entity or person obligated with respect to the Loans, of
their obligations and liabilities under the Loan Documents or in respect of the
Loans and shall not be responsible for the performance of the payment
obligations of the Borrower, any of the Guarantors or any other entity or person
obligated with respect to the Loans or any other party to any of the Loan
Documents. Nothing herein shall be deemed to impose on the Lender any duties or
responsibilities to the Participant except as otherwise expressly provided
herein.
(c) Lender shall have the right to employ and retain
attorneys, accountants, contractors, brokers, investment bankers, property
managers, engineers, environmental consultants, appraisers and other experts and
advisors to the extent the Lender reasonably deems necessary or appropriate in
connection with the monitoring of the Loans, the enforcement of the terms of the
Loans, the exercise of remedies provided or available in connection therewith
and/or the sale or liquidation of, or other realization on, the collateral
therefor (the cost of which shall be chargeable as provided for in Section 3(a)
or Section 7), and, except as expressly herein provided, (i) Lender shall have
the sole right to exercise or refrain from exercising any rights or remedies
available to the Lender under the Loans or take or refrain from taking any other
action with respect to the Loans or the collateral therefor or under the Loan
Documents or otherwise available to it, including, without limitation, the
commission, prosecution or settlement in the name of the Lender of any judicial
or nonjudicial or similar action or proceeding, at law or in equity, with
respect to any such rights or remedies and taking any action the Lender deems
necessary in connection with any other judicial or nonjudicial or similar action
or proceeding involving the Borrower, any of the Guarantors or Xxxxxxx,
including, without limitation, any bankruptcy or similar proceeding and (ii) the
sale of the Participation by the Lender shall not limit or otherwise affect the
Lender's discretion in exercising or refraining from exercising any rights or
remedies. Notwithstanding the immediately preceding sentence, (i) Lender shall
use reasonable efforts to consult in good faith with
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Participant in advance with respect to all material decisions made in connection
with the Loans and (ii) the choice by Lender of legal counsel and accountants
referred to in this Section 4(c) shall be subject to the prior reasonable
approval of Participant; provided that (1) any "big five" accounting firm shall
be acceptable, (2) the law firm of Sidley Xxxxxx Xxxxx & Xxxx LLP shall be
acceptable as bankruptcy and litigation counsel and (3) the law firm of Xxxxxxxx
& Xxxxxxxx shall be acceptable as to litigation with respect to the Borrower,
the Guarantors, Xxxxxxx or any other obligor under any of the Loan Documents and
with respect to enforcing any rights under any of the Loan Documents. The
Participant shall use good faith efforts to make a representative of Participant
available to Lender for purposes of all consultations referred to in the
immediately preceding sentence.
(d) (i) At any time prior to the completion of the sale of the
collateral for the Loans pursuant to a foreclosure proceeding, the Participant
shall have the option to purchase all, but not less than all, of the interest in
the Loans held by the Lender at a price (the "Option Price") equal to the sum of
(A) 50% of the outstanding principal amount of the Loans at the time of the
purchase of the Loans, plus (B) an amount equal to the Interest Balance Account
of the Lender on the date of the purchase, plus (C) all amounts Lender would be
entitled to receive under Section 3(a) if a distribution were made on the date
of the purchase which would pay the amount owing to Lender under Section 3(a) in
full (provided, however, that the option contained in this Section 4(d) may not
be exercised after the completion of the foreclosure sale relating to the
collateral securing the Loans or of a bankruptcy, insolvency or other similar
proceeding involving the Borrower that results in the disposition of the
collateral securing the Loans, it being understood and agreed that this Section
4(d) shall cease to be of any force and effect from and after the time of the
completion of such foreclosure sale or of such bankruptcy, insolvency or other
similar proceeding). The Participant may exercise such option by delivering
written notice of such election (a "Notice of Election") to the Lender, together
with payment of the full amount of the Option Price in the manner and within the
time period specified in Section 4(d)(ii) below. Any Notice of Election
delivered to the Lender shall constitute an irrevocable and unconditional
obligation of the Participant to purchase all of the interest in the Loans held
by the Lender at the Option Price, and upon receipt by the Lender of a Notice of
Election, the Lender shall be obligated to sell all of such interest in the
Loans held by the Lender to the Participant at the Option Price.
(ii) The closing of the purchase of the Lender's interest in
the Loans pursuant to this Section 4(d) shall occur no later than the Business
Day following the Business Day on which delivery of the Notice of Election
occurred; provided that, if the Notice of Election is delivered to Lender by
Participant at the foreclosure proceeding, then the closing shall occur
immediately upon such delivery. At the closing, Lender shall deliver to the
Participant all of Lender's interest in the Loans free and clear of all liens,
charges and encumbrances on Lender's title thereto, and the Participant shall
deliver the
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Option Price to the Lender by payment of wire transfer of immediately available
funds to an account designated by the Lender; provided that, if the Notice of
Election is delivered to Lender by Participant at the foreclosure proceeding,
then Participant shall deliver the Option Price to the Lender on the Business
Day following the closing.
(iii) Upon the closing of the purchase of the Lender's
interest in the Loans pursuant to this Section 4(d), the Lender shall not have
any further rights with respect to the servicing of the Loans, any further
obligations with respect to the Loans or any further economic interest in the
Loans.
(iv) In the event that the Participant acquires the Loans
pursuant to this Section 4(d), Lender will reasonably cooperate with Participant
to transfer to Participant all of the Lender's rights under the Loan Documents
that may be transferred to Participant under the terms of such Loan Documents
and, upon the reasonable request of Participant, Lender will execute and deliver
such other documents as may be reasonably required (without imposing any other
obligations or liabilities upon Lender) to allow Participant to exercise such
rights to the extent such rights may be transferred to the Participant under the
terms of the Loan Documents.
(e) Each of the Lender and the Participant agrees that the
Lender may submit one or more bids at the foreclosure proceeding relating to the
collateral for the Loans in such amounts as the Lender may determine following
consultation in good faith with the Participant. In the event that the
Participant desires the Lender to submit a bid at a price that is higher than a
bid that the Lender desires to submit, then the Participant (and its affiliates)
shall have the right to submit bids for the collateral at such foreclosure
proceeding for its own account and in such amounts as it may determine in its
sole and absolute discretion (or may issue to Lender a Notice of Election in
accordance with Section 4(d) above). The proceeds from the sale of the
collateral in such foreclosure sale in which Participant (or one of its
affiliates) is the successful bidder shall in all circumstances be distributed
in accordance with Section 3 hereof.
(f) If, at any time after March 19, 2002 (the "Buy-Sell
Lockout Date"), the Participant disagrees with a material action proposed to be
taken by Lender in connection with a bankruptcy, insolvency or other judicial
action involving the Borrower, and the Lender, notwithstanding such
disagreement, proceeds with such disputed material action, then both the
Participant and the Lender shall have the right to make an offer as described
below (the "Buy-Sell Offer") to the other party as set forth below (provided,
however, that the Buy-Sell Offer may not be made after the completion of the
foreclosure sale relating to the collateral securing the Loans or of a
bankruptcy, insolvency or other similar proceeding involving the Borrower that
results in the disposition of the collateral securing the Loans, it being
understood and agreed that this Section 4(f) shall cease to be
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of any force and effect from and after the time of the completion of such
foreclosure sale or of such bankruptcy, insolvency or other similar proceeding):
(i) The Buy-Sell Offer shall be in writing and be signed by
the party delivering the Buy-Sell Offer (the "Exercising Party"), and shall
specify a cash purchase price (the "Buy-Sell Offer Price") at which the
Exercising Party would purchase 100% of the Loans from the party receiving the
Buy-Sell Offer (the "Receiving Party").
(ii) The Receiving Party shall have the right, exercisable
by delivery of notice in writing (the "Buy-Sell Election") to the Exercising
Party within five (5) Business Days after the receipt of the Buy-Sell Offer, to
elect to either: (A) sell to the Exercising Party all of the Receiving Party's
right, title and interest in and to the Loans for a cash purchase price equal to
the Lender Value (if the Lender is the Receiving Party) or the Participant Value
(if the Participant is the Receiving Party); or (B) purchase all of the
Exercising Party's right, title and interest in and to Loans for a cash purchase
price equal to the Participant Value (if the Participant is the Exercising
Party) or the Lender Value (if the Lender is the Exercising Party). As used
herein, the "Lender Value" shall mean the amount Lender would receive if an
amount equal to the Buy-Sell Offer Price were distributed in accordance with the
waterfall set forth in Section 3 hereof; and "Participant Value"shall mean the
amount Participant would receive if an amount equal to the Buy-Sell Offer Price
were distributed in accordance with the waterfall set forth in Section 3 hereof.
If the Receiving Party fails to give the Exercising Party notice of the Buy-Sell
Election prior to the expiration of the five (5) Business Day period specified
in the first sentence of this clause (ii), the Receiving Party shall be deemed
to have elected to sell to the Exercising Party all of the Receiving Party's
right, title and interest in and to the Loans for a cash purchase price equal to
the Lender Value (if the Lender is the Receiving Party) or the Participant Value
(if the Participant is the Receiving Party).
(iii) The closing of the purchase and sale pursuant to this
Section 4(f) shall occur no later than the second (2nd) Business Day following
the Business Day on which the Buy-Sell Election shall have been made or shall be
deemed to have occurred. At the closing, the selling party shall deliver to the
purchasing party all of the selling party's interest in the Loans free and clear
of all liens, charges and encumbrances on its title thereto, and the purchasing
party shall deliver the Lender Value or Participant Value (as applicable) to the
selling party by payment of wire transfer of immediately available funds to an
account designated by the selling party.
(iv) Upon the closing of the purchase of the selling party's
interest in the Loans pursuant to this Section 4(f), the selling party shall not
have any further rights with respect to the servicing of the Loans, any further
obligations with respect to the Loans or any further economic interest in the
Loans.
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5. Foreclosure on Collateral.
(a) If the Lender acquires some or all of the Prime OP Units
or REIT Shares pledged as collateral for the Loans on behalf of the Lender and
the Participant as the result of a credit bid in the foreclosure proceedings,
then (i) the Lender shall, upon written request by the Participant, either (A)
deliver the Participant's Share of the Prime OP Units or REIT Shares, as the
case may be, acquired by the Lender as a result of such credit bid to the
Participant or (B) deliver a notice of election to the REIT to exchange the
Participant's Share of such Prime OP Units acquired by the Lender as a result of
such credit bid for REIT Shares and, upon receipt of such REIT Shares, the
Lender shall deliver such REIT Shares to the Participant (it being understood
and agreed that (I) any such delivery will be subject to the terms and
conditions of the organizational documents governing the REIT and the Operating
Partnership and to transfer and other restrictions imposed by applicable law and
that each party will provide the other party with all agreements and other
documents reasonably necessary or requested by the other party to ensure
compliance with such requirements and restrictions and (II) Lender shall be
entitled to retain for its own account 50% of the Prime OP Units or REIT Shares
acquired by Lender as a result of such credit bid and any REIT Shares issued
upon exchange of any such Prime OP Units so retained for the Lender's account).
Subject to the provisions of Section 5(b), (i) the Lender shall have no further
rights in respect of the Prime OP Units or REIT Shares delivered to Participant
pursuant to this Section 5(a) and (ii) the Participant shall have no rights to
the Prime OP Units and/or REIT Shares that the Lender is entitled to retain for
its own account
(b) Each of the Lender and the Participant hereby agrees
that, in regard to any Prime OP Units or REIT Shares pledged as collateral for
the Loans and acquired by the Lender on behalf of the Lender and the Participant
as the result of a credit bid in the foreclosure proceedings (including any
Prime OP Units or REIT Shares delivered to Lender or Participant for its own
account pursuant to Section 5(a) above but excluding any Prime OP Units or REIT
Shares acquired by the Participant as a result of a bid for its own account as
described in Section 4(e)), it shall not, without the prior written consent of
the other, directly or indirectly, sell or otherwise transfer or dispose of, or
grant any interest in or option with respect to, or create or permit to exist
any lien, security interest or other charge or encumbrance upon or with respect
to any such Prime OP Units or REIT Shares during the period beginning on the
date on which Lender so acquires such Prime OP Units or REIT Shares (the
"Acquisition Date") and ending on the Exclusivity Period Termination Date (such
period, the "Exclusivity Period"). The term "Exclusivity Period Termination
Date" shall mean the earlier to occur of (x) the date that is eighteen (18)
months after the Acquisition Date and (y) the date on which Participant's and/or
Participant's affiliates' standstill obligations to the REIT are terminated;
provided, however, that in no event shall the Exclusivity Period Termination
Date occur earlier than the date that is six (6) months after the Acquisition
Date. In addition, each of the Lender
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and the Participant agrees that, during the Exclusivity Period, without the
prior written consent of the other, (i) it shall not, and shall use its best
efforts to ensure that its affiliates, directors, trustees, officers, employees,
controlling shareholders or owners, legal and financial advisors, accountants
and other agents and representatives (collectively, its "Representatives") shall
not, (A) take any action, either directly or indirectly, to initiate, assist,
solicit, or encourage, any inquiries or the making or implementation of any
proposal or offer (including, without limitation, any proposal or offer to its
shareholders) with respect to a Transaction (as hereinafter defined) (B) engage
in any negotiations concerning, or provide any confidential information or data
to, or have any discussions with, any person relating to a Transaction, (C)
otherwise facilitate any effort or attempt to make or implement a Transaction or
(D) take any other action which may be reasonably expected to lead to any
Transaction, in each case, other than a Transaction in which the Lender and/or
its shareholders and/or affiliates and the Participant and/or its shareholders
and/or affiliates are participants (a "Lender/Participant Transaction"); (ii) it
will immediately cease any existing activities, discussions or negotiations with
any parties conducted heretofore with respect to any of the foregoing and will
advise such parties that it is not in a position to negotiate further with them
during the Exclusivity Period or to provide any further due diligence materials
and (iii) it shall not, and shall use its best efforts to ensure that its
affiliates or Representatives shall not, acquire, directly or indirectly, any
shares of beneficial interest of the REIT or units in the Operating Partnership
(whether by way of purchase, exercise of option, transfer or otherwise,
including, without limitation, from an affiliate) except in connection with a
Lender/Participant Transaction. A "Transaction" means a merger, acquisition,
tender offer, exchange offer, consolidation or similar business combination
transaction involving, or any purchase of all or any significant portion of the
assets or any equity securities of the REIT, the Operating Partnership or any
subsidiary of either of them, or any other sale, dividend, split,
reorganization, recapitalization, restructuring, spin-off or other disposition
of equity securities of the REIT, the Operating Partnership or any subsidiary of
either of them or any similar transaction involving, directly or indirectly, the
REIT, the Operating Partnership or any subsidiary of either of them.
Notwithstanding anything to the contrary contained herein, in the event that
Participant or Lender makes a request to the REIT to release Participant, Cadim
and/or their respective Representatives from any standstill or similar agreement
to the extent required to facilitate any of the foregoing and the REIT declines
to grant such release, then Lender, VRLP and their respective Representatives
shall be permitted, on their own behalf, to engage in a "solicitation" of
"proxies" (as such terms are defined in the rules promulgated under the
Securities Exchange Act of 1934, as amended) with respect to securities of the
REIT and/or the Operating Partnership. Neither Participant nor Cadim nor any of
their respective affiliates has or shall have any agreement, arrangement or
understanding with Lender, VRLP or any of their respective Representatives
regarding any such solicitation of proxies by Lender, VRLP or any of their
respective Representatives, and Participant,
-11-
Cadim and their respective affiliates may, in their discretion, agree to,
abstain or oppose any such solicitation of proxies.
Notwithstanding anything to the contrary in this Agreement, at any time after
the date that is six (6) months after the Acquisition Date, each of the Lender
and the Participant (in such capacity, the "Transferor") shall have the right to
sell all or a portion of the Prime OP Units or REIT Shares then owned by the
Transferor (free and clear of any restrictions under this Section 5(b));
provided that (i) the Transferor complies with the procedures set forth in the
next immediately succeeding paragraph and (ii) at some time prior to such sale,
the Lender and the Participant have made an offer to the REIT to enter into a
Transaction and such offer has been rejected by either the REIT or the REIT's
shareholders.
In connection with a sale by the Transferor of all or a portion of its Prime OP
Units or REIT Shares, the Transferor shall comply with the following procedures:
(i) The Transferor shall first offer to sell such Prime OP Units or REIT Shares
to the other party (the "Other Party") pursuant to a written offer (the "Offer")
which shall set forth the price at which the Transferor would be willing to sell
such Prime OP Units or REIT Shares to the Other Party. (ii) The Other Party
shall have seven (7) Business Days from the date of delivery of the Offer to
elect by written notice to the Transferor to either (A) purchase such Prime OP
Units or REIT Shares from the Transferor at the price set forth in the Offer,
(B) sell the Other Party's Prime OP Units or REIT Shares (or a pro rata portion
thereof, as applicable) to the same transferee that purchases the Transferor's
Prime OP Units or REIT Shares on the same terms and conditions of the sale by
the Transferor of its Prime OP Units or REIT Shares (provided that such terms
and conditions shall be no less favorable to the Other Party than those set
forth in the Offer, except that the purchase price may be 98% or more of the
purchase price set forth in the Offer) or (C) permit the Transferor to sell its
Prime OP Units or REIT Shares on terms no less favorable to the Transferor than
the terms set forth in the Offer (except that the purchase price may be 98% or
more of the purchase price set forth in the offer). If the Other Party fails to
make an election within the time period set forth above, the Other Party shall
be deemed to have elected clause (ii)(C) above. (iii) If the Other Party elects
or is deemed to have elected clauses (ii) (B) or (ii)(C) above, Transferor shall
have one hundred (100) days from the date of delivery of the Offer to complete
the sale of such Prime OP Units or REIT Shares in accordance with the terms of
this paragraph. If such sale is not completed within such one hundred (100) day
period, the provisions of this paragraph shall again apply. (iv) If the Other
Party elects the option set forth in clause (ii)(A) above, then the closing of
the sale of such Prime OP Units or REIT Shares from the Transferor to the Other
Party shall occur on the date that is twenty (20) days after the date of
delivery of the Offer (or if such day is not a Business Day, the next succeeding
Business Day) and at the closing of such sale, the Transferor shall deliver to
the Other Party all of Transferor's interest in such Prime OP Units or REIT
Shares free and clear of all liens, charges and
-12-
encumbrances on Transferor's title thereto, and the Other Party shall deliver
the purchase price set forth in the Offer to the Transferor by payment of wire
transfer of immediately available funds to an account designated by the
Transferor. If a party shall default in the sale or purchase, the non-defaulting
party shall be free to sell all or a portion of its Prime OP Units or REIT
Shares without having to comply with the terms of this paragraph.
(c) Lender and the Participant agree that if the Lender
acquires the Prime OP Units or REIT Shares that have been pledged as collateral
for the Loans on behalf of the Lender and the Participant as the result of a
credit bid in the foreclosure proceedings or if the Lender otherwise acquires
the right to do so in any other manner, Lender shall deliver to the Board of
Trustees of the REIT the resignation letters of Xxxxxxx and Xxxxxxx X. Xxxxx
delivered by Xxxxxxx and Xx. Xxxxx pursuant to the letter agreements, each dated
September 26, 2000, between VRLP and Xxxxxxx and between VRLP and Xx. Xxxxx,
comprising a portion of the Loan Documents.
(d) Lender and the Participant agree that Vornado Realty
Trust, an affiliate of the Lender, has the right to request the Board of
Trustees of the REIT to elect Xxxxxxx Xxxxxxxxxx, the President of Vornado
Realty Trust, (or such other person named by Vornado Realty Trust and reasonably
approved by the Board of Trustee of the REIT) to the Board of Trustees of the
REIT. Lender and VRLP agree that they will cause Vornado Realty Trust to
exercise or not exercise such right at such time as the Lender and Participant
shall jointly agree. Lender and Participant agree that Lender at its sole
discretion may designate Xxxxxxx Xxxxxxxxxx, but further agree that in the event
Lender does not designate Xx. Xxxxxxxxxx or Xx. Xxxxxxxxxx determines not to
serve on the Board of Trustees of the REIT, the Lender and Participant shall
jointly agree upon a replacement designee (and if the REIT does not approve such
replacement designee, one or more other replacement designees) to serve on the
Board of Trustees of the REIT in lieu of Xx. Xxxxxxxxxx.
6. Notice of Amendments and Copies of Loan Related
Information. Lender shall furnish to the Participant promptly upon receipt by
the Lender (i) copies of any amendments, waivers or modifications of the Loan
Documents, (ii) financial statements, reports and certificates furnished
pursuant to the Loan Documents, and (iii) such other information furnished to
the Lender by the Borrower relating to the Loans as the Participant shall
request.
7. Indemnification by Participant
(a) Cadim shall indemnify the Lender for 50% of any and all
losses, liabilities, obligations, damages, penalties, actions, judgments, suits,
costs and expenses (including attorneys' fees and disbursements) of any kind or
nature whatsoever (collectively, "Losses") which may be imposed on, incurred by
or asserted against the
-13-
Lender in any way relating to or arising out of the administration or servicing
of the Loans from and after the date hereof or the enforcement of any of the
terms thereof from and after the date hereof, except to the extent such Losses
arise from the Lender's gross negligence, bad faith or wilful misconduct
(provided that, in the case of a claim based on the bad faith of Lender, Lender
shall have been found in a final non-appealable judgment to have acted in bad
faith, such bad faith action shall have resulted in Losses to Participant and
Participant shall not have approved the action that is so found to constitute
bad faith) or they are recovered from the Borrower, any of the Guarantors or any
other entity or person obligated with respect to the Loans (including from the
realization on collateral security). Cadim shall also indemnify the Lender
against and hold the Lender harmless from any liability, cost, loss, damage or
expense (including attorneys' fees and disbursements) incurred by the Lender
resulting from or arising out of (i) the inaccuracy or breach in any material
respect of any of the Participant's representations or warranties contained
herein and (ii) the breach in any material respect of any of the Participant's
covenants contained herein.
(b) Cadim hereby further agrees that it shall hold harmless
from and shall fully indemnify the Lender, VRLP and their respective affiliates,
officers, directors, partners, members, shareholders, agents and representatives
(collectively, the "Vornado Indemnified Parties") against, all Losses incurred
by the Vornado Indemnified Parties as a direct result of any claim made by the
Borrower, the Guarantors, Xxxxxxx or a third party against the Lender or the
Participant or any of their respective affiliates to the extent arising out of
or by virtue of any action or failure to act by the Participant or any of its
affiliates taken or omitted prior to the date hereof, provided, however, that
Cadim's obligation to hold harmless and indemnify the Vornado Indemnified
Parties shall apply if and only to the extent that either (i) such claim shall
be decided adversely to the Participant or one or more of its affiliates by
final and non-appealable judgment and Losses are incurred as a result of such
claim or (ii) the Participant or one or more of its affiliates shall settle such
claim and Losses (other than the legal costs incurred by the Participant or its
affiliates or the Vornado Indemnified Parties) are incurred as a result of such
settlement. In addition, Cadim agrees to indemnify the Vornado Indemnified
Parties against and hold the Vornado Indemnified Parties harmless from any
Losses incurred by the Vornado Indemnified Parties, resulting from or arising
out of the administration or servicing of the Loans from and after the date of
this Agreement or the enforcement of any of the terms thereof from and after the
date of this Agreement, in each case to the extent, but only to the extent, that
such Losses arise from the Participant's gross negligence, wilful misconduct or
bad faith (provided, that in the case of Participant's bad faith, Participant
shall have been found in a final non-appealable judgment to have acted in bad
faith, such bad faith action shall have resulted in Losses to Lender and Lender
shall not have approved the action that is so found to constitute bad faith).
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(c) The Participant's indemnification obligations under this
Section 7 shall be payable within ten (10) days after a request is made therefor
by the Lender if the Participant agrees that it is obligated to pay the
requested amount or, if the Participant does not so agree, within ten (10) days
after the date on which such indemnification obligations are determined to be
payable. To the extent such indemnification obligations are not paid on or
before such tenth (10th) day, such obligations shall bear interest from such
tenth (10th) day to (but excluding) the date of payment, at a rate per annum
equal to the effective federal funds rate as obtained from the Federal Reserve
Bank of New York plus five percent (5%). These indemnities shall survive
termination of this Agreement.
(d) In no event shall the amount required to be paid by
Cadim pursuant to its indemnification obligations under this Section 7 exceed
Fifty Million Dollars ($50,000,000).
8. Indemnification by VRLP:
(a) VRLP shall indemnify the Participant for 50% of any and
all Losses which may be imposed on, incurred by or asserted against the
Participant in any way relating to or arising out of the administration or
servicing of the Loans from and after the date hereof or the enforcement of any
of the terms thereof from and after the date hereof, except to the extent such
Losses arise from the Participant's gross negligence, bad faith or wilful
misconduct (provided that, in the case of a claim based on the bad faith of
Participant, Participant shall have been found in a final non-appealable
judgment to have acted in bad faith, such bad faith action shall have resulted
in Losses to Lender and Lender shall not have approved the action that is so
found to constitute bad faith) or they are recovered from the Borrower, any of
the Guarantors or any other entity or person obligated with respect to the Loans
(including from the realization on collateral security). VRLP shall also
indemnify the Participant against and hold the Participant harmless from any
Losses incurred by the Participant, resulting from or arising out of (i) the
inaccuracy or breach in any material respect of any of the Lender's
representations or warranties contained herein, or (ii) the breach in any
material respect of any of the Lender's covenants contained herein.
(b) VRLP hereby agrees that it shall hold harmless from and
shall fully indemnify the Participant and its affiliates, officers, directors,
partners, members, shareholders, agents and representatives (collectively, the
"Participant Indemnified Parties") against, all Losses incurred by the
Participant Indemnified Parties as a direct result of any claim made by the
Borrower, the Guarantors, Xxxxxxx or a third party against the Lender and/or
Participant or either of their respective Affiliates arising out of or by virtue
of any action or failure to act by the Lender or any of its affiliates taken or
omitted prior to the date hereof in connection with the Loans; provided,
however, that VRLP's obligation to hold harmless and indemnify the Participant
Indemnified Parties
-15-
shall apply if and only to the extent that either (i) such claim shall be
decided adversely to the Lender or one or more of its affiliates by final and
non-appealable judgment and Losses are incurred as a result of such claim or
(ii) the Lender or one or more of its affiliates shall settle such claim and
Losses (other than the legal costs incurred by the Lender or its affiliates or
the Participant Indemnified Parties) are incurred as a result of such
settlement. In addition, VRLP agrees to indemnify the Participant Indemnified
Parties against and hold the Participant Indemnified Parties harmless from any
Losses incurred by the Participant Indemnified Parties, resulting from or
arising out of the administration or servicing of the Loans from and after the
date of this Agreement or the enforcement of any of the terms thereof from and
after the date of this Agreement, in each case to the extent, but only to the
extent, that such Losses arise from the Lender's gross negligence, wilful
misconduct or bad faith (provided, that in the case of Lender's bad faith,
Lender shall have been found in a final non-appealable judgment to have acted in
bad faith, such bad faith action shall have resulted in Losses to Participant
and Participant shall not have approved the action that is so found to
constitute bad faith).
(c) VRLP's indemnification obligations under this Section 8
shall be payable within ten (10) days after a request is made therefor by the
Participant if VRLP agrees that it is obligated to pay the requested amount or,
if VRLP does not so agree, within ten (10) days after the date on which such
indemnification obligations are determined to be payable. To the extent such
indemnification obligations are not paid on or before such tenth (10th) day,
such obligations shall bear interest from such tenth (10th) day to (but
excluding) the date of payment, at a rate per annum equal to the effective
federal funds rate as obtained from the Federal Reserve Bank of New York plus
five percent (5%). These indemnities shall survive termination of this
Agreement.
(d) Notwithstanding anything contained in this Section 8 to
the contrary, in no event shall VRLP have any indemnification obligation in
respect of any Losses incurred in connection with, or as a result of, any
assertions that the foreclosure proceeding relating to the collateral securing
the Loans is or was not "commercially reasonable" within the meaning of
applicable law, including the Uniform Commercial Code as in effect in the State
of New York (it being understood and agreed that all such Losses shall be borne
50% by Lender and 50% by Participant).
(e) In no event shall the amount required to be paid by VRLP
pursuant to its indemnification or obligations under this Section 8 exceed Fifty
Million Dollars ($50,000,000).
9. Payment Directions. All payments made hereunder by any
party shall be made in the lawful currency of the United States of America by
wire transfer of immediately available federal funds as follows:
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If to the Lender or to a Vornado Indemnified Party:
Bank: Fleet Bank N.A.
New York, NY
ABA No.: 000000000
Account No.: 0000000000
Account Name: Vornado Realty L.P.
Attention: Xxxx Xxxxxxxx at (201) 587-1000 ext. 2202
If to the Participant or to a Participant Indemnified Party:
Bank: Chase Manhattan Bank
ABA No.: 021-00-0021
Account No.: 000-0-000000
Account Name: Cadim Holdings U.S. Inc.
Attention: Line Xxxxxxxx at (000) 000-0000
Any party may change the account to which payments are to be made hereunder by
notice from time to time to the other parties.
10. Return of Excess Payments. If the Lender should for any
reason make any payment to the Participant in anticipation of the receipt of
funds from the Borrower, any of the Guarantors or any other entity or person
obligated with respect to the Loans and such funds are not received by the
Lender from the Borrower, any of the Guarantors or such entity or person on the
date payment is due, or are in excess of the amount due to the Participant, then
the Participant shall, upon request by the Lender, forthwith return to the
Lender any such amounts transferred to the Participant by the Lender plus
interest thereon from the day such amounts were transferred by the Lender to the
Participant to but excluding the day such amounts are returned by the
Participant, at a rate per annum equal to the effective federal funds rate as
obtained from the Federal Reserve Bank of New York. Nothing in this Agreement
shall be construed as obligating the Lender to advance funds, and in connection
with the enforcement or monitoring of the Loans, the Lender shall have the right
to refrain from taking any action if it requests funds from the Participant (as
an advance payment of or reimbursement for costs incurred in accordance with the
terms of this Agreement) and the Participant does not advance its share.
11. Returns of Amounts Deemed Preferences.
(a) If the Lender is required at any time to return pursuant
to any bankruptcy, insolvency, liquidation or reorganization law or otherwise,
any portion of the payments made by the Borrower, any of the Guarantors or any
other entity or person obligated with respect to the Loans or otherwise received
by the Lender, the Participant shall, on demand of the Lender, forthwith return
to the Lender any such amounts received
-17-
by the Participant, but without interest thereon unless the Lender is required
to pay interest on such amounts to the person recovering such payment, in which
case with interest thereon, computed at the same rate that the Lender is
required to pay.
(b) If the Participant receives any payment on account of
either of the Loans, including by exercise of any right of set-off, counterclaim
or banker's lien that it may have, in excess of the amount which the Participant
is entitled to receive pursuant to this Agreement, the Participant shall
promptly deliver such excess to the Lender. If the Participant is required at
any time to return pursuant to any bankruptcy, insolvency, liquidation or
reorganization law or otherwise, any portion of the payments referred to in the
preceding sentence, the Lender shall, on demand of the Participant, return to
the Participant such excess (or portion thereof) received by the Lender, but
without interest thereon unless the Participant is required to pay interest on
such amounts to the person recovering such payment, in which case with interest
thereon, computed at the same rate that the Participant is required to pay.
12. No Taxes. If the Participant is not organized under the
laws of the United States or a state thereof, the Participant represents and
warrants to the Lender that under applicable law and treaties no taxes will be
required to be withheld by the Lender with respect to payments to be made to the
Participant hereunder and, the Participant agrees that it shall furnish to the
Lender in a timely fashion a properly completed and duly executed Internal
Revenue Service Form W8-BEN or Form W8-ECI, as applicable, and additional Forms
W8-BEN or Form W8-ECI, or appropriate successor forms, to the extent that the
form previously furnished has ceased to be effective, the information therein
has become inaccurate, or such form has been superseded. The Participant agrees
that it shall comply from time to time with all applicable laws and regulations
of the United States with regard to such withholding tax exemption and the
Lender shall be permitted, to the extent required by law, to withhold from
payments otherwise payable to the Participant hereunder any amounts required to
be so withheld under applicable law.
13. Survival of Obligations. The Participant's and the
Lender's obligations under this Agreement shall not be affected by any
invalidity, unenforceability or insufficiency of any Loan Document, or any
default by or insolvency of the Borrower, any of the Guarantors or any other
entity or person obligated with respect to the Loans.
14. Notices. All notices and requests required or permitted
hereunder shall be given in writing and shall be effective for all purposes if
hand delivered or sent by (a) certified or registered mail, postage prepaid, (b)
expedited prepaid delivery service, with proof of attempted delivery or (c)
telecopy or facsimile, addressed as set forth on the signature page hereto (or
at such other address and person as shall be designated from time to time by any
party hereto in a written notice to the other parties hereto in the manner
provided for in this Section). A notice shall be deemed to have been given: in
the
-18-
case of hand delivery, at the time of delivery as confirmed by a receipt signed
by the recipient; in the case of registered or certified mail, when delivered or
the first attempted delivery on a Business Day; in the case of expedited prepaid
delivery, upon the delivery (or refusal thereof) thereof; or in the case of
telecopy or facsimile, upon receipt.
15. Intentionally Omitted.
16. No Third Party Beneficiaries. This Agreement is solely
for the benefit of the Lender, the Vornado Indemnified Parties and their
respective successors and assignees and the Participant, the Participant
Indemnified Parties and their respective successors and assigns, and nothing
contained in this Agreement shall be deemed to confer upon anyone other than
such parties any right to insist upon or to enforce the performance or
observance of any of the obligations contained herein or therein.
17. No Brokers and Financial Advisors. Lender and the
Participant each hereby represents to the other that it has dealt with no
financial advisors, brokers, underwriters, placement agents, agents or finders
in connection with the transactions contemplated by this Agreement which could
cause the other party to become subject to the payment of fees, commissions,
cost or expenses as a result thereof. Each of the Lender and the Participant
agrees to indemnify and hold harmless the other for all costs, damages or other
expenses arising out of any breach of its representation made in this Section
17.
18. Representations and Warranties of the Lender.
(a) Lender hereby represents and warrants to the
Participant:
(i) The Participation is not subject to any assignment,
conveyance, transfer or participation or agreement to assign, convey,
transfer or participate, in whole or in part, except as created hereby.
(ii) Lender has good title to and is the sole legal and
beneficial owner of the Participation free and clear of all liens,
charges and encumbrances to such title, except as created hereby.
(iii) Lender has the requisite limited liability company power
and authority to execute and deliver, and to perform all of its
obligations under, this Agreement and all other instruments and
documents executed and delivered by the Lender in connection herewith.
(iv) This Agreement constitutes the legal, valid and binding
obligation of the Lender and VRLP enforceable against each of them in
accordance with its
-19-
terms, except as such enforceability may be limited by bankruptcy,
insolvency, moratorium or other similar laws affecting the enforcement
of creditors' rights generally or general principles of equity.
(v) The Vornado Loan Documents listed on Exhibit A constitute
all documents which evidence the Vornado Loan, and to the knowledge of
Lender, the Prudential Loan Documents listed on Exhibit B constitute
all documents which evidence the Prudential Loan. To Lender's
knowledge, Participant has been provided with true and complete copies
of such documents as received by the Lender and executed by Borrower.
The Vornado Loan Documents have not been amended or modified by the
Lender in any respect, and to Lender's knowledge, except as set forth
on Exhibit B, the Prudential Loan Documents have not been amended or
modified in any respect.
(vi) As of the Closing Date, the aggregate principal sum
outstanding under the Vornado Note will be $62,000,000.00, interest and
fees outstanding under the Vornado Note will be $4,563,599.00 and other
charges outstanding under the Vornado Note will be $305,000.00. As of
the Closing Date, the aggregate principal sum outstanding under the
Prudential Note will be $37,978,480.00, interest and fees outstanding
under the Prudential Note will be $203,480.00 and other charges
outstanding under the Prudential Note will be $951,768.00.
(vii) Lender does not know of any offsets or defenses on the
part of Borrower, any Guarantor or Xxxxxxx with respect to the
obligations of any of them under the Loan Documents, and, to its
knowledge, no such party or other third party has made any claim
against Lender in connection with the Vornado Loan or against the
Lender or the Prudential Lender in connection with the Prudential Loan
except as set forth on Schedule I; provided however, that no
representation contained herein shall be deemed to constitute a
representation regarding the "commercial reasonableness" of the
foreclosure proceeding relating to the collateral securing the Loans
for purposes of applicable law, including the Uniform Commercial Code
as in effect in the State of New York.
(viii) Lender is the 100% owner of the Loans and there are no
participants in the Loans other than Participant.
(ix) Lender has the right under the Loan Documents to sell the
Participation to Participant on the terms set forth herein and no
consent from any third party is required to sell such Participation to
Participant.
-20-
(x) This Agreement and the performance of its obligations
hereunder by Lender and VRLP do not violate any agreement to which
either of them is a party or to which either of them is bound.
(b) Except for the specific representations and warranties
made by the Lender in this Agreement, Lender makes no representation or warranty
with reference to, and it does not assume nor shall it have responsibility or
liability express or implied for, the due authorization, execution or delivery
by the Borrower, any of the Guarantors or any other entity or person obligated
with respect to the Loans or the Loan Documents, any representation or warranty
made by the Borrower, any of the Guarantors or other entity or person obligated
with respect to the Loans, the performance or observance by the Borrower, any of
the Guarantors or other entity or person obligated with respect to the Loans of
any provisions of the Loan Documents, the enforceability, collectability,
validity or legality of any Loan Documents, or any security interest granted to
or for the benefit of the Lender or the financial condition or solvency of the
Borrower, any of the Guarantors or any other entity or person obligated with
respect to the Loans or any credit or other information provided by the
Borrower, any of the Guarantors or other entity or person obligated with respect
to the Loans or the sufficiency of any collateral securing the Loans.
19. Representations and Warranties of the Participant.
(a) Participant hereby represents and warrants to the Lender:
(i) Participant has the requisite limited liability company
power and authority to execute and deliver, and to perform all of its
obligations under, this Agreement and all other instruments and
documents executed and delivered by the Participant in connection
herewith.
(ii) This Agreement constitutes the legal, valid and binding
obligation of the Participant and Cadim enforceable against each of
them in accordance with its terms, except as such enforceability may be
limited by bankruptcy, insolvency, moratorium or other similar laws
affecting the enforcement of creditors' rights generally or general
principles of equity.
(iii) Participant has obtained the waiver attached hereto as
Exhibit C and such attachment is a true and correct copy of such
waiver.
(iv) Participant has received a copy of each of the documents
listed on Exhibit A and Exhibit B hereto.
-21-
(v) Participant has independently and without reliance on the
Lender, and based on such documents and information that the
Participant deems appropriate, made its own analysis of the Borrower,
the Guarantors and any other entity or person obligated with respect to
the Loans, and the collateral and security therefor, for the purpose of
purchasing the Participation in the Loans and that it will continue to
make its own credit decisions without such reliance and on such basis.
(vi) This Agreement and the performance of its obligations
hereunder by each of Participant and Cadim do not violate any agreement
to which either of them is a party or to which either of them is bound.
20. No Assignments, Subparticipations. This Agreement may not
be assigned by any party without the prior written consent of the other parties.
The Participant may not sell, assign, subdivide, subparticipate or otherwise
transfer the Participation or any part thereof or interest therein without the
prior written consent of the Lender (except to an affiliate of Participant
controlled by or under common control with Participant). Other than pursuant to
this Agreement, the Lender may not sell, assign, subdivide, subparticipate or
otherwise transfer the Loans or any part thereof or interest therein without the
prior written consent of the Participant (except to an affiliate of Lender
controlled by or under common control with Lender).
21. Intentionally Omitted.
22. Governing Law. THIS AGREEMENT SHALL BE CONSTRUED AND
ENFORCEABLE IN ACCORDANCE WITH, AND GOVERNED BY, THE LAWS OF THE STATE OF NEW
YORK.
23. Entire Agreement. This Agreement embodies the entire
agreement and understanding between the parties hereto with respect to the
subject matter hereof and supersedes all other prior arrangements and
understandings relating to the subject matter hereof.
24. Confidentiality. The Participant agrees that it and its
agents will keep the information contained in any documents delivered to it in
connection with the Loans confidential (whether delivered prior to or after its
execution of this Agreement, unless such information was already in the
possession of Participant and not otherwise subject to an obligation to keep
such information confidential or was already in the public domain); provided,
however, any such information may be disclosed to the extent required by law (it
being understood and agreed that the disclosing party will provide, in such
circumstances, a copy of
-22-
the information to be so disclosed to the other party prior to such disclosure)
and to the Participant's affiliates, directors, officers, employees and
representatives who need to know such information for the purpose of managing
the Participation (it being understood that such affiliates, directors,
officers, employees and representatives shall be informed by the Participant of
the confidential nature of such information and shall be directed by the
Participant to treat such information confidentially).
25. Modifications in Writing. This Agreement may not be
amended, changed, waived or modified except by a writing executed by both the
Lender and the Participant.
26. Rules of Construction. The section headings in this
Agreement are included herein for convenience of reference only and shall not
constitute a part of this Agreement for any other purpose. All section
references shall mean references to the sections of this Agreement, unless
otherwise specified. As used herein, the terms "include" and "including" shall
be deemed to mean "without limitation", and the terms "herein", "hereof" and
"hereunder" and terms of like import shall be construed to refer to this
Agreement as a whole and not the specific section or provision in which such
term is used. The parties hereto acknowledge that they were represented by
counsel in connection with the negotiation and drafting of this Agreement and
this Agreement shall not be subject to the principle of construing its meaning
against the party which drafted same.
27. Severability. Wherever possible, each provision of this
Agreement shall be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Agreement shall be prohibited by or
invalid under applicable law, such provision shall be ineffective to the extent
of such prohibition or invalidity, without invalidating the remainder of such
provision or the remaining provisions of this Agreement.
28. Counterparts. This Agreement may be executed in any number
of counterparts, each of when where so executed and delivered shall be an
original, but all of which shall constitute one and the same instrument. It
shall not be necessary in making proof of this Agreement to produce or account
for more than one copy of such instrument.
29. Choice of Forum; Waiver of Immunity; Waiver of Jury Trial.
Each of the parties hereto irrevocably agrees that any legal action or
proceeding against it arising out of or in connection with this Agreement or for
recognition or enforcement of any judgment rendered in any such action or
-23-
proceeding may be brought in the United States Courts or the State of New York
Courts, in each case located in the Borough of Manhattan, City and State of New
York, and by execution and delivery of this Agreement, each party hereby
irrevocably accepts and submits to the jurisdiction of each of the aforesaid
courts in personam, generally and unconditionally with respect to any such
action or proceeding. Each of the Parties hereto further irrevocably consents to
the service of process out of said courts by mailing a copy thereof, by
registered or certified mail, postage prepaid to it at the address set forth for
such party herein below. Each of the Parties hereto also irrevocably waives, to
the fullest extent permitted by law, any objection which it may now or hereafter
have to the laying of venue of any such action or proceeding brought in any such
court and any claim that any such action or proceeding brought in such court has
been brought in an inconvenient forum. Each of the Parties hereto irrevocably
agrees that, should either party institute any legal action or proceeding in any
jurisdiction (whether for an injunction, specific performance, damages or
otherwise) in relation to this Agreement, no immunity (to the extent that it may
at any time exist, whether on the grounds of sovereignty or otherwise) from such
action or proceeding shall be claimed by it or on its behalf, any such immunity
being hereby irrevocably waived and that each of the Parties hereto each
irrevocably agrees that it and its assets are, and shall be, subject to such
legal action or proceeding in respect of its obligations under this Agreement.
Each of the Parties hereto hereby waives any right to trial by jury in
connection with any action, proceeding or counterclaim instituted with respect
to this Agreement.
-24-
Please indicate the Participant's and Cadim's agreement to the
foregoing by executing this Agreement on the line provided below and returning
to the undersigned two copies of the Agreement.
VORNADO PS, L.L.C., a Delaware limited
liability company
By: Vornado Realty L.P., a Delaware
limited partnership and its Sole
Member
By: Vornado Realty Trust, a Maryland
real estate investment trust and its
General Partner
By: /s/ Xxxxxxx Xxxxxxxxxx
-----------------------------
Name: Xxxxxxx Xxxxxxxxxx
Title: President
Address: Vornado PS, L.L.C.
000 Xxxxxxx Xxxxxx,
00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxx Xxxxxxxxxx
Facsimile: (000) 000-0000
Telephone: (000) 000-0000
Attention: Xxxxxx Xxxxxx
Facsimile: (000) 000-0000
Telephone: (000) 000-0000
-25-
VORNADO REALTY L.P., a Delaware
limited partnership
By: Vornado Realty Trust, a Maryland
real estate investment trust and its
General Partner
By: /s/ Xxxxxxx Xxxxxxxxxx
-----------------------------
Name: Xxxxxxx Xxxxxxxxxx
Title: President
Address: Vornado Realty L.P.
000 Xxxxxxx Xxxxxx,
00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxx Xxxxxxxxxx
Facsimile: (000) 000-0000
Telephone: (000) 000-0000
Attention: Xxxxxx Xxxxxx
Facsimile: (000) 000-0000
Telephone: (000) 000-0000
-26-
Accepted and Agreed to:
CADIM ACQUISITION, LLC,
a Delaware limited liability company
By: Cadim Holdings U.S. Inc.,
a Delaware corporation, its sole member
By: /s/ X. Xxxxxxxxx
----------------------------
Name: X. Xxxxxxxxx
Title: Vice President
By: /s/ X. Xxxxxxxx
-----------------------------
Name: X. Xxxxxxxx
Title: Vice President
Address: c/o Mayer, Xxxxx & Xxxxx
000 Xxxxx XxXxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxxxx X. Xxxxxxxxxx or
Xxxx X. Xxxxxx
Facsimile: (000) 000-0000
Telephone: (000) 000-0000
CADIM INC., a company incorporated
under the laws of Quebec
By: /s/ X. Xxxxxxxxx
----------------------------
Name: X. Xxxxxxxxx
Title: Vice President
By: /s/ X. Xxxxxxxx
-----------------------------
Name: X. Xxxxxxxx
Title: Vice President
Address: 000, Xxxxxx Xxxxxxxx, Xxxxxx 0000
Case Postale 000
Xxxxxxxx, Xxxxxx X0X 0X0
Attention: Xxxxxxx Xxxxxxxxx
Facsimile: (000) 000-0000
Telephone: (000) 000-0000
-27-
Exhibit C
CONSENT AND AGREEMENT
This CONSENT AND AGREEMENT (this "Agreement") is entered into
as of this 16th day of November, 2001, by and among Prime Group Realty Trust, a
Maryland real estate investment trust (the "REIT"), Prime Group Realty, L.P., a
Delaware limited partnership (the "Partnership"), and Cadim inc. ("Cadim"), an
affiliate of Caisse de depot et placement du Quebec ("CDP").
W I T N E S S E T H:
WHEREAS, the REIT is the Managing General Partner of the
Partnership;
WHEREAS, the Partnership and Cadim have previously entered
into a Confidentiality and Standstill Agreement dated as of July 5, 2001 (the
"CSA"), as amended by a First Amendment to Confidentiality and Standstill
Agreement, dated as of October 12, 2001 (the "First Amendment"), among the
Partnership, the REIT and Cadim (as so amended, the "Confidentiality
Agreement");
WHEREAS, the Partnership, the REIT, Cadim and The Prime Group,
Inc. have entered into an Amended and Restated Support and Standstill Agreement
dated as of September 14, 2001 (the "SSA");
WHEREAS, Primestone Investment Partners L.P., a Delaware
limited partnership (the "Borrower"), the REIT, the Partnership, The Prime
Group, Inc., an Illinois corporation ("PGI"), and certain other investors named
therein have entered into the Registration Rights Agreement dated as of November
17, 1997 (as the same may from time to time be amended or modified in accordance
with its terms, the "Registration Rights Agreement");
WHEREAS, by letter dated November 9, 2001 (the "Cadim
Letter"), Cadim has requested that the REIT grant certain waivers to, make
certain agreements with and acknowledgements to, Cadim for the benefit of Cadim
and its affiliates, concerning, in part, the 7,944,893 outstanding common units
of limited partner interest of the Partnership that are pledged by the Borrower
(the "Pledged Units") under (i) the Loan Agreement among the Borrower and
Vornado PS, L.L.C. and the other parties thereto, dated September 26, 2000, and
(ii) the Amended and Restated Credit Agreement among P-B Finance Ltd. and the
Borrower, dated as of September 26, 2000 (collectively, the "Loan Agreements"),
and the common shares of the REIT issuable upon exchange of such common units
(collectively with the Pledged Units, the "Pledged Shares"); and
WHEREAS, the Board of Trustees (the "Board") of the REIT and
the Committee of Independent Trustees (the "Independent Committee") of the Board
have considered the various requests contained in the Cadim Letter and have
determined that certain of such requests are advisable and in the best interests
of the REIT and its shareholders.
NOW, THEREFORE, in consideration of the foregoing and other
good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereby consent and agree as follows:
1. Limited Waiver of Ownership Limit. The REIT hereby
acknowledges that, subject to the provisions of Section 2 of this Agreement, the
conditions set forth in Section 4.6 of the REIT's Articles of Amendment and
Restatement, as supplemented (as so supplemented, the "Declaration of Trust")
have been satisfied and that the "Ownership Limit" (as defined in the
Declaration of Trust) is waived with respect to Cadim or CDP and any affiliate
of Cadim or CDP (other than any "individual" for purposes of Section 542(a)(2)
of the Internal Revenue Code of 1986, as amended) (x) that is controlled by
Cadim or CDP and (y) in which Cadim or CDP own at least 75% of the outstanding
equity interest (collectively, the "Cadim Entities") (but not with respect to
any transferees or purported transferees of the Cadim Entities) by the Board to
the extent and only to the extent set forth in this Agreement, the Excepted
Holder Certificate delivered by Cadim on the date hereof and attached hereto as
Exhibit A and the Resolutions of the Board attached hereto as Exhibit B (the
"Board Resolutions"). Accordingly, and subject to the foregoing, the REIT hereby
confirms that it has granted a waiver of the Ownership Limit as it applies to
the Cadim Entities to the extent, and only to the extent, necessary to allow the
Cadim Entities to become the beneficial owners of all or a portion of the
Pledged Shares. Nothing contained herein shall be deemed as a limitation on any
Cadim Entity's right to transfer or assign its interest in the loans pursuant to
the Loan Agreements; provided, that any assignee or transferee of any such
interest shall be subject to the Ownership Limit unless such assignee or
transferee shall have obtained a valid waiver of the Ownership Limit from the
REIT.
2. Cadim Representation, Warranty and Covenant. Notwithstanding
anything in this Agreement, the Excepted Holder Certificate or the Board
Resolutions to the contrary, Cadim hereby represents and warrants to and
covenants for the benefit of the REIT that, neither it nor any of the Cadim
Entities or their affiliates currently own or will directly or indirectly
acquire or own any interest in any of the REIT's or the Partnership's equity
securities, without the prior written approval of the REIT, other than the
Pledged Shares (or a portion thereof). The benefits to the Cadim Entities
contained in this Agreement and the Board Resolutions shall be null and void and
this Agreement and the Board Resolutions shall be revocable and subject to
modification by the Board, in each case in the event the foregoing
representation, warranty and covenant is breached; provided, however, that the
foregoing representation, warranty and covenant shall not be breached as the
result of (i) the unknowing and indirect acquisition by any of the Cadim
Entities of an interest in an immaterial number of the REIT's or the
Partnership's securities if such Cadim Entity causes the disposition of
2
such interest promptly after it becomes aware of the consummation of such
indirect acquisition or (ii) the independent ownership or acquisition by
trustees or officers of any of the Cadim Entities of an immaterial number of
equity securities of the REIT or the Partnership for their own personal account.
3. Maryland Law Matters. The REIT hereby represents, warrants and
agrees, subject to the second sentence of the foregoing Section 2, that,
pursuant to Section 3-603(c) of the Maryland Business Combination Act (the
"MBCA") set forth in the Maryland General Corporation Law, any "business
combination" (as that term is defined in the MBCA) of the REIT with any of the
Cadim Entities (or any affiliate thereof) has been exempted from the provisions
of Section 3-602 of the MBCA, provided that the business combination is first
approved by the Board, including approval by a majority of the members of the
Board who are not "affiliates" or "associates" (as each such term is defined in
the MBCA) of the Cadim Entities (or any affiliate thereof). Notwithstanding the
foregoing and notwithstanding Section 3-601(j)(3) of the MBCA, each of the Cadim
Entities will be an "interested stockholder" (as that term is defined in the
MBCA) of the REIT if and at all times that it is an "interested stockholder" of
the REIT within the definition thereof set forth in the MBCA.
4. Confidentiality Agreement and SSA. The REIT and the
Partnership hereby grant a consent under the Confidentiality Agreement to permit
the acquisition by the Cadim Entities of all or part of the Pledged Shares
either directly or by virtue of purchasing the Loan Agreements or a
participation therein. In addition, and without in any way otherwise releasing
Cadim or any of its affiliates from their obligations under the Confidentiality
Agreement and the SSA, the REIT and the Partnership hereby acknowledge and agree
(i) that the Cadim Entities may engage in discussions with, or may at some point
entertain the possibility of a joint proposal together with, Vornado Realty
Trust (or Vornado Realty Trust and one or more of its control affiliates),
regarding a possible strategic transaction involving the Partnership and the
REIT (a "Possible Transaction"), and may act together in concert for such
purpose, and as a result may be, or may be deemed to be, a "group" under the
Exchange Act of 1934, as amended (the "Exchange Act"), so long as none of such
discussions, exchanges of views or concerted activities regarding a possible
proposal of a Possible Transaction require or result in any public filing or
other public disclosure of specific discussions, specific proposals or specific
concerted activities relating to a Possible Transaction pursuant to Regulation
13D promulgated under the Exchange Act, or otherwise, and (ii) that any such
discussions, exchanges of views, concerted activities or the formation of a
"group" for the purposes described above in this Section 4 shall not violate the
terms of the Confidentiality Agreement, including the provisions of Section 2 of
the First Amendment (it being further understood that public disclosure on
Schedule 13D by any of the Cadim Entities or Vornado Realty Trust (A) that such
parties are, or may be deemed to be, a "group" under the Exchange Act, by virtue
of their joint exercise of remedies under the Loan Agreements to obtain
beneficial ownership of the Pledged Shares (and related activities) or (B) that
such parties may in the future make a proposal regarding a Possible Transaction,
shall not violate the terms of the Confidentiality Agreement, including the
provisions of Section 2 of the First Amendment, so long as such disclosure(s) do
not include specific proposals or plans to make specific proposals); provided,
that none of the Cadim Entities may
3
provide any "Evaluation Material" (as defined in each of the Confidentiality
Agreement and the SSA) to Vornado or any of its affiliates, agents, advisors,
etc., unless Vornado first executes and delivers to the REIT a confidentiality
and standstill agreement reasonably acceptable to the REIT.
5. Exchange of Partnership Units. In the event that any Cadim
Entity becomes the beneficial owner of any of the Pledged Units, notwithstanding
the provisions of the Partnership Agreement, the REIT and Partnership shall
cause the exchange of all such Pledged Units for common shares of the REIT for
which such Pledged Units are then exchangeable within five business days
following the REIT and Partnership's receipt of written notice from or on behalf
of any Cadim Entity of such acquisition (it being understood that such
acquisition notice shall contain in substance the information and request that
is otherwise required in an "Exchange Exercise Notice" (as defined in Exhibit C
to the Partnership Agreement)) and shall be accompanied by appropriate evidence
of beneficial ownership by the applicable Cadim Entity of such Pledged Units
together with the physical certificate(s) representing the applicable Pledged
Units.
6. Registration Rights Agreement. Each of the REIT and the
Partnership agrees, that the Cadim Entities, to the extent they own any of the
Pledged Shares, shall be entitled to require and enforce the performance of all
actions and things required to be performed by the REIT or the Partnership under
the Registration Rights Agreement and shall be entitled to all rights thereunder
to which the Borrower is entitled. The REIT agrees that as promptly as possible
after the date hereof, the REIT will amend the prospectus constituting part of
the shelf registration statement filed pursuant to Article IV of the
Registration Rights Agreement to include the applicable Cadim Entity and/or any
permitted subsequent holder of the Pledged Shares as a selling shareholder under
such Registration Rights Agreement and that the REIT will continue to include
such Cadim Entity, and/or any subsequent permitted holder of the Pledged Shares
as such a selling shareholder under the Registration Rights Agreement for so
long as any Cadim Entity may be entitled to exercise rights under the
Registration Rights Agreement in accordance with its terms as modified hereby.
7. The Board Resolutions. The Board Resolutions were adopted by
the Board on November 14, 2001, and have not been amended, modified or rescinded
and remain in full force and effect as of the date of this Agreement. Except as
set forth in the foregoing Section 2, neither the Board nor the REIT shall,
without the prior written consent of the relevant Cadim Entities, allow the
Board Resolutions to be amended, modified or rescinded by the Board in any
manner which adversely affects any of the relevant Cadim Entities' rights under
this Agreement and the Board Resolutions.
8. Miscellaneous.
(a) No Waiver; Amendments. No failure on the
part of any party to this Agreement to exercise, no delay in exercising, and no
course of dealing with respect to, any right or remedy hereunder will operate as
a waiver thereof, nor will any single or partial exercise of any
4
right or remedy hereunder preclude any other further exercise of any other right
or remedy. This Agreement may not be amended, supplemented or modified except by
written agreement of all of the parties hereto.
(b) Confidentiality. Subject to the provisions
of Section 4 hereof, except as otherwise required by applicable law or the rules
or regulations of any securities exchange on which the securities of such party
or any affiliate of such party are listed or traded, each of the parties hereto
agrees that it and its affiliates shall not issue or cause the publication of
any press release or other public announcement with respect to the transactions
contemplated by this Agreement without the consent of the other party hereto,
and in such event disclosure is required, such party shall, prior to making such
disclosure, inform the other party of such proposed disclosure and reasonably
cooperate with such other party regarding the proposed content of such
disclosure.
(c) Notices. All notices and other
communications required under the terms and provisions hereof shall be in
writing and shall be addressed:
If to the REIT and/or the Partnership:
c/o Prime Group Realty Trust
00 Xxxx Xxxxxx Xxxxx
Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
Attn: Xxxxx X. Xxxxxxxx and Xxxxxxx X. Xxxxxxxxx
Telecopy No.: (000) 000-0000 and (000) 000-0000
With copies to:
Prime Group Realty Trust
00 Xxxx Xxxxxx Xxxxx
Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxxx X. Xxxxxxx
Telecopy No.: (000) 000-0000
And to:
0
Xxxxxxx & Xxxxxx
00 Xxxx Xxxxxx Xxxxx
Xxxxxxx, Xxxxxxxx 00000
Attn: Xxxxx X. Xxxxxx
Xxxxx X. Black
Telecopy No.: (000) 000-0000
Or if to The Cadim Entities:
Cadim inc.
000 Xxxxxx Xxxxxxxx
Xxxxx 0000
X.X. Xxx 000
Xxxxxxxx Xxxxxx X0X0X0
Attn.: Xxxxx Xxxxxx
Telecopy No.: (000) 000-0000
With a copy to:
Cadim inc.
000 Xxxxxx Xxxxxxxx
Xxxxx 0000
X.X. Xxx 000
Xxxxxxxx Xxxxxx X0X0X0
Attn.: Xxxxxx Xxxxxx
Telecopy No.: (000) 000-0000
And to:
Xxxxx, Xxxxx & Xxxxx
000 X. XxXxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
Attn: Xxxxxx X. Xxxxxxxxxx
Telecopy No.: (000) 000-0000
Or at such other place as any party may hereafter designate to the other party
hereto in writing. Any notice under this Agreement to the REIT, Partnership or
the Cadim Entities
6
shall be in writing and sent (A) by facsimile transmission (provided a copy of
such notice is also sent on the same day by one of the methods set forth in the
following clauses (B) or (C)), or (B) by registered or certified mail with
return receipt requested (postage paid), or (C) by a recognized overnight
delivery service with charges prepaid. Any notice under this Agreement to any
party shall be deemed given only when received or when delivery is refused or
not able to be made because such party has moved without giving notification to
the other party pursuant to this Section 8(c) of such party's new address.
(d) Successors and Assigns. This Agreement shall
be binding upon and inure to the benefit of the REIT and the Partnership and
their respective successors and assigns. This Agreement shall be binding upon
and inure to the benefit of the Cadim Entities; provided, however, that the
Cadim Entities' rights, waivers, exemptions and other benefits under this
Agreement shall not be assignable to any third party and any attempted
assignment shall be null and void.
(e) Governing Law. This Consent and Agreement
shall be governed by and construed and enforced in accordance with the laws of
the State of Maryland without regard to conflicts of laws provisions thereof.
(f) Business Day. "Business Day" means, for
purposes of this Agreement, any day other than a Saturday, Sunday, or other day
on which commercial banks in Chicago, Illinois are obligated or permitted to be
closed.
(g) Counterparts. This Agreement may be executed
in separate counterparts, each of which shall be deemed to be a full and
complete copy of this Agreement.
[signature page follows]
7
IN WITNESS WHEREOF, the undersigned, have executed this
Consent and Agreement as of the date set forth in the first paragraph of this
Consent and Agreement.
OPERATING PARTNERSHIP:
PRIME GROUP REALTY, L.P.
a Delaware limited partnership
By: Prime Group Realty Trust,
a Maryland real estate
investment trust,
its general partner
By: /s/ Xxxxx X. Xxxxxxx
---------------------------------
Name: Xxxxx X. Xxxxxxx
Title: Executive Vice President, General
Counsel & Secretary
TRUST:
PRIME GROUP REALTY TRUST,
a Maryland real estate investment Trust
By: /s/ Xxxxx X. Xxxxxxx
---------------------------------
Name: Xxxxx X. Xxxxxxx
Title: Executive Vice President, General
Counsel & Secretary
-8-
CADIM:
CADIM INC.
By: /s/ X. Xxxxxxxxx
--------------------------------
Name: X. Xxxxxxxxx
Title: Vice President
By: /s/ X. Xxxxxxxx
---------------------------------
Name: X. Xxxxxxxx
Title: Vice President
-9-
