EXHIBIT 10.22
INTERCREDITOR AGREEMENT
THIS INTERCREDITOR AGREEMENT (the "Agreement") is dated as of the 25th day
of April, 1997, by and between THE FIRST NATIONAL BANK OF BOSTON, a national
bank organized under the laws of the United States of America, its successors
and assigns, for itself ("Bank Boston") and as agent for certain other lenders
("Agent"), and WELLSFORD REAL PROPERTIES, INC. ("Wellsford"). Collectively,
Bank Boston (except when acting as the Agent), Wellsford and each other party
which may become a party to the Credit Agreement (as hereinafter defined) shall
be referred to as the "Banks," and individually as a "Bank."
Recitals
A. Pursuant to the Credit Agreement, dated as of April __, 1997 (such
agreement, as amended, modified, extended, revised or supplemented in
accordance with its terms, is hereinafter referred to as the "Credit
Agreement"), among PAMC Co-Manager Inc. and Park Avenue Financing Company LLC
(collectively the "Borrowers"), the Agent, Bank Boston, Wellsford and certain
other parties, the Banks have agreed to make available to the Borrowers a loan
of $80,000,000 upon the terms set forth in the Credit Agreement (the "Loan");
B. The Agent and Banks desire to supplement the provisions of the Credit
Agreement relating to the relationship of the Banks with respect to one another
and the Agent;
NOW, THEREFORE, in consideration of the mutual covenants contained herein,
the Banks and the Agent agree as follows:
1. Definitions.
(a) For the purposes of this Agreement, the term "Majority
Banks" shall mean the Bank or Banks whose aggregate Commitment Percentage
exceeds fifty percent (50%). Any capitalized terms not otherwise defined
herein shall have the meanings ascribed to them in the Credit Agreement.
(b) For the purposes of the Credit Agreement, the "Majority
Banks" as defined in the Credit Agreement shall mean the "Majority Banks" (as
such term is defined herein), except to the extent that the approval of all of
the Banks is specifically required for such action or approval (in which case
the "Majority Banks" as used in the Credit Agreement shall mean all of the
Banks).
2. Relationship with Credit Agreement. The parties hereto
acknowledge and ratify the Credit Agreement and acknowledge that this Agreement
is meant to supplement, and not to abrogate, the terms of the Credit Agreement.
All provisions of this Agreement shall be read so as to be compatible with the
provisions of the Credit Agreement. In th event of a conflict, the terms of
the Credit Agreement shall control.
3. Representations of the Banks. Each Bank represents to and
agrees with each other Bank that (a) in the event that such Bank now or
hereafter has other loans, commitments, letters of credit or other financial
accommodations or arrangements outstanding to Borrowers, Guarantors, the
Property Owner, Managing Member, any other Additional Pledgor or an affiliate
of any of such Persons, such Bank shall deal with the Loan and Loan Documents
(including without limitation any decisions to be made under Section 5(c)) as
if it were the only loan in such Bank's portfolio to such Persons; (b) such
Bank's execution and delivery of this Agreement has been duly authorized and it
has full power and authority to execute this Agreement; (c) such Bank's
decision to enter into this Agreement was based solely upon its own independent
evaluation of the Loan and the Loan Documents and the creditworthiness of the
Borrowers and the Guarantor and the value of the Collateral and without
reliance upon any warranties or representations of any other Bank or any of
their respective officers, directors, employees, agents or attorneys; (d) such
Bank acknowledges receipt of copies of all Loan Documents; and (e) such Bank
does not control, is not controlled by, is not under common control with and is
otherwise free from influence or control by, the Borrowers, the Managing
Member, the Guarantor and the Additional Pledgors. Except as set forth above
or as otherwise provided herein or in the Loan Documents, no Bank makes any
further representations or warranties, express or implied, including, without
limitation, any representation or warranty as to the collectability of the
Loan, enforceability of the Loan Documents, continued solvency of the
Borrowers, the Guarantor, the Additional Pledgors or the Property Owner or the
continued existence, sufficiency or value of any assets of the Borrower, the
Guarantors or the Additional Pledgors which may be realized upon for the
repayment of the Loan. No Bank shall be responsible in any manner to any other
Bank for the observation of or compliance with any of the terms, covenants or
conditions of the Loan Documents on the part of the Borrowers, the Guarantor or
the Additional Pledgors.
4. Set-Off Against Other Indebtedness. Notwithstanding the
provisions of Section 3(a), above, each Bank agrees that any deposits of money
or property or other indebtedness held or owing by such Bank to or for the
credit or the account of any of the Borrowers, the Guarantor or the other
Additional Pledgors which may now or hereafter be specifically pledged as
collateral under the Credit Agreement or other Loan Documents shall not be set-
off against indebtedness other than the Obligations; provided, however, that
the foregoing restriction shall not limit any Bank's right of set-off against
any Indebtedness other than the Obligations with respect to any such deposit of
money, property or other indebtedness which has not been specifically pledged
as collateral notwithstanding any general description of secured obligations
contained in any security agreement or other instrument held by such Bank;
provided further, however, that no Bank shall be permitted to exercise any
right of set-off against any Borrower, Guarantor or any other Additional
Pledgor if such exercise would jeopardize the Agent's ability to realize upon
the Collateral pursuant to the Security Documents in any jurisdiction which has
a so-called "single action rule."
5. Notice of Event of Default, Exercise of Remedies, Approvals,
etc.
(a) In the event that Agent or any Bank acquires Actual
Knowledge (as herein defined) of the occurrence of a Default or an Event of
Default, Agent or the Bank acquiring such knowledge will notify the other Banks
thereof as soon as is reasonably practical. Thereafter, the Agent shall
provide the Banks with prior written notice of any actions proposed or
recommended to be taken by Agent with respect thereto unless the giving of such
notice is impractical for reasons of safety or preservation of Collateral, in
which event Agent shall promptly notify the Banks of such action. For purposes
of this Agreement, "Actual Knowledge" shall mean actual knowledge of any
officer of Agent or any Bank having primary, day-to-day responsibility for
administration of the Loan.
(b) (i) Agent shall not take any action hereunder or under the
Loan Documents following a Default or Event of Default, except as specifically
authorized herein to the contrary, unless such action is approved by the
Majority Banks and, subject to the terms of this Agreement and the other Loan
Documents, the Agent shall take such actions as are directed by the Majority
Banks following a Default or Event of Default. Following such approval, the
Agent shall, subject to the terms of this Section 5(b), take such action or
actions, assert such rights, exercise such remedies and/or waive such Default
or Event of Default or refrain from taking such actions with respect thereto
as, but only as, agreed to in writing by the Majority Banks. The Agent shall,
if so requested by the Majority Banks and the Banks have provided to the Agent
such additional indemnities and assurances in accordance with their respective
Commitment Percentages against expenses and liabilities as the Agent may
reasonably request, proceed to enforce the provisions of the Security Documents
authorizing the sale or other disposition of all or any part of the Collateral
and exercise all or any legal and equitable and other rights or remedies as it
may have in respect of such Collateral or against the Borrowers, the Guarantor
or any other Additional Pledgor. Subject to the terms hereof, the Majority
Banks may direct the Agent in writing as to the method and the extent of any
such action, sale or disposition, the Banks hereby agreeing to indemnify and
hold the Agent harmless in accordance with their respective Commitment
Percentages from all liabilities incurred in respect of all actions taken or
omitted in accordance with such directions, provided that the Agent need not
comply with any such direction to the extent that the Agent reasonably believes
the Agent's compliance with such direction to be unlawful or commercially
unreasonable in any applicable jurisdiction. In the event that the Bank that
is also the Agent is the Majority Bank, the Agent shall give prompt notice to
the other Banks of any actions that such Bank as Agent has elected to take
under this Agreement.
(ii) Agent shall not be required to obtain the consent of
the Majority Banks to its taking any action with respect to the Loan if
immediate action is required to be taken in the best interest of the Banks to
preserve or protect the continued enforceability of the Loan Documents. Agent
shall promptly verbally notify the Banks if Agent takes such immediate action,
which notice shall be promptly confirmed in writing. Without limiting the
generality of the foregoing, if the Agent reasonably determines payment is in
the best interest of all the Banks, Agent may without the approval of the Banks
pay amounts necessary to cure defaults under the Mortgage Loan Documents,
provided that the amount that may be spent annually by the Agent for such
purpose shall not exceed $10,000,000.00 without obtaining the consent of the
Majority Banks. Each Bank shall, within thirty (30) days of request therefor,
pay to the Agent in the manner set forth in Section 8 below, its Commitment
Percentage of the costs incurred by the Agent in taking any such actions
hereunder to the extent that such costs shall not be promptly reimbursed to the
Agent by the Borrowers or the Guarantor or out of the Collateral within such
period and such costs shall be deemed an "Expense" as defined in Section 8 of
this Agreement.
(c) If consent is required for some action under this Agreement
or, except as otherwise provided herein, an approval of the Majority Banks (as
such term is used in the Credit Agreement) is required or permitted under the
Credit Agreement, each Bank agrees to give the Agent and the other Banks,
within ten (10) Business Days of receipt of the request for action together
with all reasonably requested information related thereto (or such lesser
period of time required by the terms of the Loan Documents), notice in writing
of its approval or disapproval (collectively "Directions") in respect of any
action requested or proposed in writing pursuant to the terms hereof. To the
extent that any Bank does not approve any recommendation of Agent, such Bank
shall in such notice to Agent describe the actions that would be acceptable to
such Bank. If consent is required for the requested action, any Bank's failure
to respond to a request for Directions within the required time period shall be
deemed to constitute a Direction to take such requested action. In the event
that any recommendation is not approved by the requisite number of Banks and a
subsequent approval on the same subject matter is requested by Agent, then for
the purposes of this paragraph each Bank shall be required to respond to a
request for Directions within five (5) Business Days of receipt of such
request. Agent and each Bank shall be entitled to assume that any officer of
the other Banks delivering any notice, consent, certificate or other writing is
authorized to give such notice, consent, certificate or other writing unless
Agent and such other Banks have otherwise been notified in writing.
(d) For the purposes of carrying out the provisions and
exercising the rights, remedies, powers and privileges granted by or referred
to in this Agreement and the Loan Documents, each of the Banks, subject to the
other terms of this Agreement and the Loan Documents, hereby irrevocably
constitutes and appoints the Agent to hold the Collateral and enforce the Loan
Documents and to exercise such powers, rights and remedies under this Agreement
and the Loan Documents as are delegated to Agent by the terms hereof or
thereof, together with all such powers, rights and remedies as are reasonably
incidental thereto.
6. Foreclosure; Possession of Collateral.
(a) If the Agent shall take possession of any of the Collateral
after the occurrence of any Event of Default (upon institution of foreclosure
proceedings or otherwise) as and to the extent provided by the Loan Documents,
the Agent shall collect all sales proceeds, distribution, dividends or other
revenues from the Collateral and may incur expenses in connection with the
operation and management of the Collateral, which expenses shall be deemed
"Expenses" for the purposes of this Agreement and shall be payable by the Banks
as provided in this Paragraph 6(a). With the consent of the Majority Banks,
the Agent may employ an independent third party management firm whose fees
shall be negotiated on an arm's length basis; provided, however,
notwithstanding the foregoing, if the Majority Banks cannot agree as to the
employment of a management firm within ten (10) Business Days of request
therefor by Agent, Agent shall be entitled to employ such independent third
party management firm as Agent deems necessary to protect and enforce the
interests and rights of all the Banks and to pay such management fees and
expenses to such firm as Agent in its good faith business judgment deems
appropriate under the circumstances. Any manager selected by the Agent or the
Majority Banks shall be a "Qualifying Manager" pursuant to the terms of the
Mortgage. All management fees paid to an independent third party and all other
reasonable fees and expenses paid or incurred by the Agent in accordance with
the terms of this Agreement shall be deducted from distribution, dividends,
revenues and/or sales proceeds collected, or if such amounts are insufficient,
such fees and expenses shall be paid by the Banks, with each Bank paying such
Bank's Commitment Percentage thereof within ten (10) days of receipt of a
request therefor.
(b) If there shall be a foreclosure sale of all or a portion of
the Collateral, the Agent shall bid at the foreclosure sale on behalf of the
Banks to raise any bid made by others at said sale, up to the highest price
agreed upon by the Majority Banks (not to exceed the indebtedness outstanding
under the Loan Documents), or if the Majority Banks are unable to agree, then
an amount determined by Agent in the exercise of its good faith business
judgment (but in no event in an amount in excess of the indebtedness
outstanding under the Loan Documents). Upon completion of a foreclosure sale
and the conveyance of said Collateral to the highest bidder, the Agent shall
render an accounting for monies received and monies expended between the date
of taking possession of such Collateral and the date of conveyance to the
highest bidder, including, without limitation, expenses of foreclosure. If the
highest bidder shall be someone other than the Agent, then, upon receipt from
the highest bidder of the amount of the bid, the Agent will remit each Bank's
Commitment Percentage of the net amount received from the foreclosure sale to
such Bank, after deducting all reasonable Expenses incurred by Agent in
accordance with the terms of this Agreement.
(c) Any decision to sell any of the Collateral acquired by the
Agent, the Banks or their nominees must be approved by the Majority Banks;
provided, however, that the consent of all of the Banks shall be required if
the sale is other than for all cash. If all of the Banks agree to take a
purchase money obligation and mortgage instrument or security interest in part
payment for the sale of any of the Collateral acquired by the Agent, the Banks
or their nominees, as the case may be, then the Agent, the Banks and their
nominees, as applicable, agree to enter into an agreement with respect to that
obligation and mortgage instrument or security interest, defining the Banks' or
their nominees' rights in the same in accordance with the Banks' or their
nominees' Commitment Percentage, which agreement shall be in all material
respects similar to this Agreement, to the extent this Agreement is appropriate
or applicable. In the absence of such an agreement, the obligation and
mortgage instrument or security interest shall be held by the mortgagee or
security interest holder for the ratable benefit of the Banks and their
nominees in accordance with their respective Commitment Percentages and shall
be subject to the terms of this Agreement to the extent applicable.
(d) If any of the Agent, the Banks or any nominee of any of
them acquires the Collateral either by foreclosure or deed in lieu of
foreclosure, then the Collateral shall be held for the pro rata benefit of the
Banks by a corporation or other entity or entities approved by the Majority
Banks, the interests in which shall be owned by the Banks or their nominees
based upon their respective Commitment Percentages. Any such corporation or
other entity shall comply with all requirements applicable to such entity set
forth in the Mortgage. This Agreement shall continue in full force and effect
during such ownership of the Collateral and this Agreement shall govern the
rights and obligations of the parties in connection with such ownership, until
such time as the written agreement described below in this Subsection 6(d)
below is executed. In the event such acquisition shall occur, the Agent and
the Banks agree to negotiate in good faith to reach agreement relating to the
ownership, operation, maintenance, management, leasing and marketing of the
Collateral, which agreement shall be consistent with the following: (i) except
as otherwise provided in this subparagraph, decisions regarding the
administration and disposition of the Collateral and all other decisions with
respect to the Collateral shall require the consent of the Majority Banks; (ii)
the Collateral will not be held as a long-term investment and will be marketed
to sell such Collateral in a time period consistent with the regulations
applicable to national banks or foreign banks for owning real estate, whichever
is shorter; (iii) certain decision making with respect to the day-to-day
operations of the Collateral may be delegated to management and leasing agents,
provided that, subject to the terms of Paragraph 6(a) above, all agreements
with such management and leasing agents will be subject to the approval of the
Majority Banks; (iv) all decisions reserved to the owner in such agreements
will be subject to the approval of the Majority Banks; (v) all expenses
incurred by the Agent and the Banks in connection with the Collateral shall be
allocated among the Banks pro rata in accordance with their respective
Commitment Percentages; and (vi) each Bank shall waive its right to partition
the Collateral. The documents shall provide for customary remedies in the
event any Bank does not pay its pro rata share of such expenses. All proceeds
received from the operation, sale or other disposition of the Collateral (net
of expenses incurred in connection therewith) shall be paid to the Banks in
accordance with each Bank's Commitment Percentage.
7. Transfers; Removal of Agent.
(a) Each Bank may sell, assign, pledge or enter into
participations for all or any part of their respective interests in the Loan
and Loan Documents in compliance with the terms of the Credit Agreement.
Notwithstanding anything herein, in the Credit Agreement or elsewhere to the
contrary, any assignment, or sale of a participation in, any interest in or
part of the Loan or the Loan Documents shall be subject to the terms of this
Agreement and that certain Recognition Agreement dated as of the date hereof
among the Agent, BOB, Wellsford, the Borrowers, the Mortgagee and the Property
Owner, and as a condition to any such assignment, the assignee shall
acknowledge that it is subject to the terms of this Agreement and assume the
obligations of a Bank hereunder, such agreement to be in form and substance
satisfactory to Agent.
(b) The Majority Banks may remove the Agent from its capacity
as agent as provided in the Credit Agreement. The Commitment Percentage of the
Bank which is acting as Agent shall not be taken into account in the
calculation of Majority Banks for the purposes of removing Agent in the event
of the Agent's willful misconduct or gross negligence. After the removal of
Agent, the provisions of this Agreement and the Loan Documents shall continue
in effect for its benefit with respect to any actions taken or omitted to be
taken by it while it was acting as Agent.
8. Cost and Expense Sharing. Within ten (10) Business Days of
receipt of a request therefor from Agent (to the extent that the same have not
been paid by the Borrowers, the Guarantor or the other Additional Pledgors
within thirty (30) days of demand for payment of the same), each Bank will pay
its pro rata share (based on its Commitment Percentage) of all reasonable out-
of-pocket costs and expenses (including, without limitation, reasonable
attorneys' fees, appraisers' fees and consultants' fees) which are incurred by
the Agent (a) in connection with the administration of the Loan and the Loan
Documents or enforcement of the obligations of Borrowers, the Guarantor or the
Additional Pledgors under the Loan and the Loan Documents, (b) in connection
with the foreclosure of the Loan Documents, or (c) which, by the terms of this
Agreement, are deemed to be expenses (hereinafter collectively referred to as
the "Expenses"). The Banks shall pay their Commitment Percentage of Expenses
for attorneys, appraisers and consultants retained by Agent. In the event
Agent later receives reimbursement from the Borrowers, the Guarantor, the
Additional Pledgors or another source for such costs, expenses or other
Expenses, Agent shall promptly refund to each Bank its ratable share of such
reimbursement.
9. Payments.
(a) Except as expressly provided herein to the contrary,
nothing herein shall be deemed (i) to give any Bank any advantage over the
others with respect to reimbursement for, or other payment on account of, any
of the Borrowers', Guarantor's or the Additional Pledgors' obligations under
the Loan Documents or any attorneys' fees or expenses incurred by Agent in
connection with enforcement of the obligations of such Persons under any of the
Loan Documents, or (ii) to relieve any Bank from absorbing its respective pro
rata part of any losses sustained with respect to the amount of any of
Borrowers', the Guarantor's or the Additional Pledgors' obligations under any
of the Loan Documents.
(b) If any Bank is entitled to and decides to require a payment
of any amounts described in Article 4 of the Credit Agreement, such Bank shall
(i) give written notice thereof to the Agent and the Borrowers, and (ii)
deliver to Agent such other information, certifications and documentation as is
required to be furnished to the Borrowers under the terms of Section 4.11 of
the Credit Agreement, and such amount shall be payable to such Bank in
accordance with the terms of the Credit Agreement.
10. Standard of Care. Agent shall service the Loan in accordance
with its customary practices in servicing loans entered into solely for its own
account, and as provided in this Agreement. Nothing contained in this
Agreement or the other Loan Documents is intended to create an agency or
fiduciary relationship, it being acknowledged that Agent's obligations are
primarily administrative in nature. Agent shall not be required to take any
action which violates the terms of this Agreement or any of the Loan Documents
or violates any laws, rules, court orders and decisions, ordinances,
regulations, statutes, requirements, codes and executive orders, now existing
or hereafter created.
11. Defaults by Bank.
(a) If for any reason any Bank (a "Defaulting Bank") shall fail
to abide by its obligations under this Agreement or under any Loan Document and
such failure shall continue for ten (10) Business Days after notice with
respect to monetary obligations hereunder or under any Loan Document or thirty
(30) days after notice with respect to non-monetary obligations hereunder or
under any Loan Document (provided, however, that if such non-monetary default
is of a nature that the same cannot be reasonably cured within thirty (30) days
and such Bank shall have commenced to cure such non-monetary default within
such period and shall thereafter proceed with reasonable diligence and good
faith to cure such non-monetary default, such period shall be extended for such
longer period as shall be necessary for such Bank to cure such default with all
reasonable diligence, but in no event beyond that date which is one hundred
twenty (120) days after such Bank received notice of such default), then, in
addition to the rights and remedies that may be available to the Agent at law
and in equity, such Defaulting Bank's right to participate in the
administration of the Loan Documents, including, without limitation, any rights
to consent to or direct any action or inaction of the Agent pursuant to
Sections 5 or 6 above or otherwise, or to be taken into account in the
calculation of Majority Banks, shall be suspended during the pendency of such
failure. If for any reason a Bank fails to make timely payment to the Agent of
any amount required to be paid to it hereunder (without giving effect to any
notice or cure periods), in addition to the other rights and remedies which the
Agent may have under this Section 11 or otherwise, the Agent shall be entitled
(i) to collect interest from such Bank for the period from the date on which
the payment was due at the Federal Funds Effective Rate for each day during
such period, (ii) to withhold or setoff, and to apply to the payment of the
defaulted amount and any related interest, any amounts to be paid to such Bank
under this Agreement or the Loan Documents, and (iii) to bring an action or
suit against such Bank in a court of competent jurisdiction to recover the
defaulted amount and any related interest.
(b) In the event a Bank becomes a Defaulting Bank, other Banks
who are not Defaulting Banks (the "Current Banks") shall have the right, but
not the obligation, in their sole discretion, to acquire (or, if more than one
Bank exercises such right, each such Bank shall have the right to acquire, pro
rata based on their relative Commitment Percentages, or such proportion as they
may mutually agree) the Commitment of the Defaulting Bank. Upon any such
purchase of the Commitment of the Defaulting Bank, the Defaulting Bank's
interest in the Obligations and its rights hereunder and under the Loan
Documents (but not its liability with respect thereto or under the Loan
Documents or this Agreement to the extent that the same relate to the period
prior to the effective date of the purchase) shall terminate at the date of
purchase, and the Defaulting Bank shall promptly execute all documents
reasonably requested to surrender and transfer such interest. The purchase
price for the Defaulting Bank's Commitment shall equal the Defaulting Bank's
proportionate share of the principal balance of the Obligations outstanding and
owed by the Borrowers, its ratable share of which has been advanced by the
Defaulting Bank, plus any and all accrued and unpaid interest thereon and fees
in connection therewith. On or before the date of such purchase, the
Defaulting Bank shall pay to the Agent a processing fee of Two Thousand Dollars
($2,000.00).
12. Amendments. This Agreement may not be amended, modified or
terminated except by an agreement in writing signed by each Bank and Agent.
13. NOT A LOAN; NO DUTY TO PURCHASE. THIS AGREEMENT SHALL IN NO WAY
BE CONSTRUED AS PROVIDING AN EXTENSION OF CREDIT BY ANY BANK TO ANY OTHER OF
THE BANKS. NO BANK SHALL HAVE THE OBLIGATION TO PURCHASE THE PERCENTAGE
INTEREST OF ANY OTHER PARTY HERETO UPON ANY DEFAULT BY THE BORROWERS, THE
GUARANTOR OR ANY OTHER ADDITIONAL PLEDGOR UNDER ANY OF THE LOAN DOCUMENTS OR IN
ANY OTHER EVENT WHATSOEVER.
14. Withholding Taxes. If Agent shall be required by law to deduct
and withhold taxes or other charges imposed by any jurisdiction ("Taxes") from
any amounts payable to a Bank with respect to the Loan because such Bank is a
Non-Exempt Person (as hereinafter defined), Agent shall be entitled to do so
with respect to such Bank's interest in such payment (all withheld amounts
being deemed paid to such Bank). "Non-Exempt Person" is any person other than
a person who is either (i) a United States person, or (ii) has on file with
Agent for the year involved such duly executed forms or statements which may,
from time to time, be prescribed by law and which, pursuant to applicable
provisions of (a) an income tax treaty between the United States and the
country of residence of such person, (b) the United States Internal Revenue
Code of 1986, as amended and as such may hereafter be amended, or (c) any
applicable rules or regulations in effect under (i) or (ii) above, and which
permit Agent to make such payments free of any obligation or liability for
withholding. Each Bank agrees to indemnify Agent against and to hold Agent
harmless from any Taxes, interest, penalties and attorneys' fees arising from
any failure of Agent to withhold Taxes from payments made to such Bank in
reliance upon any representation or document made or provided by such Bank to
Agent, it being agreed that (x) Agent shall be absolutely and unconditionally
entitled to accept any such representation or document as being true and
correct in all respects and to fully rely thereon without any obligation or
responsibility to investigate the same, and (y) such Bank shall, upon request
of Agent and at the Bank's sole cost and expense, defend any claim relating to
the indemnification by counsel selected by such Bank reasonably satisfactory to
Agent. Each Bank represents to Agent that such Bank is not a Non-Exempt Person
and that Agent is not obligated under applicable law to withhold Taxes on any
sum paid to such Bank pursuant to this Agreement. If requested by Agent,
contemporaneously with the execution of this Agreement, and, if requested by
Agent from time to time as necessary during the term of this Agreement, each
Bank shall deliver to Agent evidence reasonably satisfactory to Agent
substantiating that such Bank is not a Non-Exempt Person and that Agent is not
obligated under applicable law to withhold Taxes on sums paid to it with
respect to the Loan or otherwise. As used herein, the term "Person" means any
individual, firm, corporation, association, partnership, joint venture, trust,
other entity or tribunal, and the term "Tribunal" means any state, federal,
foreign or other court or governmental department, commission, board, bureau,
agency or instrumentality.
15. No Reliance By Others. None of the provisions of this Agreement
shall inure to the benefit of the Borrowers, the Guarantor, any other
Additional Pledgor or any person other than the Banks and Agent; consequently,
neither the Borrowers, the Guarantor nor the Additional Pledgors shall be, and
no person other than the Banks and Agent shall be, entitled to rely upon or
raise as a defense, in any manner whatsoever, the failure of either Bank or
Agent to comply with the provisions of this Agreement. Neither the Banks nor
the Agent shall incur any liability to the Borrowers, the Guarantor, the other
Additional Pledgors or any other person for any act or omission of the Banks or
Agent.
16. Legal Fees. If any legal or equitable action or proceeding is
brought by Agent or a Bank to enforce or construe a provision of this
Agreement, the unsuccessful party in such action or proceeding, whether such
action or proceeding is settled or prosecuted to final judgment, shall pay all
of the reasonable attorneys' fees and costs incurred by the prevailing party.
17. Notices. All notices and other communications hereunder shall
be in writing (unless verbal communications are expressly permitted hereunder)
and shall be personally delivered or delivered by commercial courier service or
deposited in the United States Mail (certified, return receipt requested and
postage prepaid), or transmitted by facsimile, in each case addressed to the
party to whom notice is being given at its address set forth below its
signature hereto or at such other address as may hereafter be designated in
writing by a party hereto to the Agent and the other Banks. All such notices
or communications shall be deemed given on (i) the date received if delivered
personally or when delivered by commercial courier service, (ii) the date of
receipt or refusal to accept receipt thereof if sent by certified mail, or
(iii) the first Business Day following the Business Day of transmission by
facsimile. Any verbal communications permitted hereunder shall be promptly
confirmed in writing.
18. Construction. All headings appearing in this Agreement are for
convenience only and shall be disregarded in construing this Agreement. No
waiver of any breach of the terms of this Agreement shall be implied from any
failure to take, or delay in taking, action with respect to such breach or any
previous waiver of any similar or unrelated breach. A waiver of any term of
this Agreement must be made in writing and shall be limited to the express
terms of such writing.
19. Law. This Agreement shall be governed by, and construed in
accordance with, the laws of the State of New York.
20. Severability. The invalidity, illegality or unenforceability of
any provision of this Agreement, pursuant to judicial decree, shall not affect
the validity or enforceability of any other provision hereof, all of which
shall remain in full force and effect.
21. Successors and Assigns. Except as otherwise provided herein,
the terms and provisions of this Agreement shall inure to the benefit of and be
binding upon and enforceable by the respective successors and assigns of the
parties hereto.
22. Counterparts. This Agreement may be executed in any number of
counterparts, all of which taken together shall constitute one and the same
instrument, and any of the parties hereto may execute this Agreement by signing
any such counterpart.
23. Termination. Unless otherwise agreed to by the parties, this
Agreement shall terminate when the Obligations have been paid and finally
discharged in full and no portion of the Obligations has been reinstated or is
required to be repaid by the Banks or Agent to the Borrowers or any other
Person or, if the Agent, Banks or the Banks' nominees take title to the
Collateral by foreclosure or conveyance in lieu of foreclosure, when the
Collateral is thereafter sold to a third party purchaser and all purchase money
financing, if any, is paid in full. The provisions of Section 8 of this
Agreement and all provisions requiring the Banks to indemnify the Agent shall
survive repayment of the Loan and termination of this Agreement.
24. Judicial Interpretation. In the event the provisions of this
Agreement require judicial or other interpretation, it is agreed that the court
interpreting or construing same shall not apply a presumption that the terms
hereof shall be more strictly construed against one party by reason of the rule
of construction that a document is to be more strictly construed against a
party who by itself or through its agents prepared the same, it being agreed
that all parties to this Agreement participated in the preparation of this
Agreement.
25. No Joint Venture. This Agreement shall not be construed to
create a partnership or joint venture between the parties hereto nor shall
Agent have any fiduciary obligations to any of the Banks.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their respective duly authorized officers as of the date first
above written.
THE FIRST NATIONAL BANK OF
BOSTON
(as both Bank and Agent)
By: /s/ Xxxx X. Xxxxxx
_______________________________
Its:
The First National Bank of Boston
000 Xxxxxxxxx Xxxxxx Xxxxx, X.X.
Xxxxx 000
Xxxxxxx, Xxxxxxx 00000
Attn: Xxxx X. Xxxxxx
Facsimile: (000) 000-0000
and
The First National Bank of Boston
000 Xxxxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Attn: Real Estate Division
Facsimile: (000) 000-0000
WELLSFORD REAL PROPERTIES, INC.
By:/s/ Xxxxxx Xxxxxxxxx
_____________________________
Title: President
Wellsford Real Properties, Inc.
000 Xxxxx Xxxxxx
0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxxxxx Xxxxxx
Facsimile: 312/333-2323
