PLEDGE AND SECURITY AGREEMENT
Dated as of June 30, 2007
by
GTJ REIT, INC.
as Pledgor
in favor of
ING USA ANNUITY AND LIFE INSURANCE COMPANY,
ING LIFE INSURANCE AND ANNUITY COMPANY,
RELIASTAR LIFE INSURANCE COMPANY, and
SECURITY LIFE OF DENVER INSURANCE COMPANY,
as Secured Parties
------------------
relating to
LOAN AGREEMENT
Dated as of June 30, 2007
among
GTJ REIT, INC. and
THE OTHER BORROWERS NAMED THEREIN
as Borrowers
and
THE LENDERS NAMED THEREIN
as Lenders
TABLE OF CONTENTS
Page
1. DEFINITIONS...........................................................1
2. PLEDGE................................................................3
3. DELIVERY AND REGISTRATION OF COLLATERAL...............................3
4. VOTING RIGHTS; PAYMENTS, DIVIDENDS, AND DISTRIBUTIONS.................5
5. REPRESENTATIONS AND WARRANTIES........................................5
6. FURTHER ASSURANCES....................................................6
7. COVENANTS OF THE PLEDGOR..............................................7
8. THE SECURED PARTY AS THE PLEDGOR'S ATTORNEY-IN-FACT...................7
9. REMEDIES UPON DEFAULT.................................................8
10. APPLICATION OF PROCEEDS..............................................10
11. INDEMNITY AND EXPENSES...............................................11
12. DUTIES OF THE SECURED PARTY..........................................11
13. AMENDMENTS; ETC......................................................11
14. CONTINUING SECURITY INTEREST.........................................12
15. SECURITY INTEREST ABSOLUTE...........................................12
16. WAIVER OF MARSHALING.................................................12
17. MISCELLANEOUS........................................................13
(a) Notices.......................................................13
(b) Successors and Assigns........................................13
(c) Severability..................................................13
(d) Construction..................................................13
(e) Counterparts; Execution and Delivery by Facsimile or E-mail...14
(f) Waiver of Jury Trial........................................14
(g) Governing Law...............................................14
Schedule 1........-- Pledged Interests
Exhibit 3(a)......-- Form of Indorsement Certificate
Exhibit 3(f) .....-- Form of Issuer Acknowledgement
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PLEDGE AND SECURITY AGREEMENT
This Pledge and Security Agreement, dated as of June 300, 2007 (this
"Agreement"), is by GTJ REIT, INC., a Maryland corporation (the "Pledgor"), in
favor of ING USA ANNUITY AND LIFE INSURANCE COMPANY, ING LIFE INSURANCE AND
ANNUITY COMPANY, RELIASTAR LIFE INSURANCE COMPANY, and SECURITY LIFE OF DENVER
INSURANCE COMPANY, as Lenders and secured parties hereunder (individually and
collectively, and including any other Persons that may from time to time become
Lenders under and as defined in the Loan Agreement, the "Secured Party").
Preliminary Statements:
A. Concurrently with the execution and delivery hereof, the Pledgor; Green
Acquisition, Inc.; Triboro Acquisition, Inc.; Jamaica Acquisition, Inc.;
000-00xx 000xx Xxxxxx, XXX; 00-00 Xxxxxxxx Xxxxx Xxxxxxxxx, LLC; 00-00 00xx
Xxxxxx, XXX; and 114-15 Xxx Xxxxxx Boulevard, LLC, as Borrowers, and the Lenders
are entering into a Loan Agreement, dated as of the date hereof (the "Loan
Agreement"), pursuant to which the Lenders may make Loans to the Borrowers.
B. The Pledgor legally and beneficially owns the Pledged Interests.
C. To induce the Lenders to make Loans, the Pledgor desires to pledge,
grant, transfer, and assign to the Secured Party a security interest in the
Collateral to secure the Secured Obligations, as provided herein.
Agreement:
In consideration of the foregoing and the mutual agreements set forth
below, and for other good and valuable consideration, the parties hereby agree
and covenant as follows:
1. Definitions.
As used herein, each following term has the respective meaning indicated
below, in the other agreement indicated below or in the Section or other part of
this Agreement indicated below:
"Agreement" is defined in the introductory paragraph.
"Assignment of Leases and Rents" is defined in the Loan Agreement.
"Bankruptcy Code" means the United States Bankruptcy Code (11 U.S.C.
Section 101 et seq.).
"Borrowers" is defined in the Loan Agreement.
"Business Day" is defined in the Loan Agreement.
"Collateral" means, collectively, the Pledged Interests, the Future Rights,
and the Proceeds.
"Event of Default" is defined in the Loan Agreement.
"Future Rights" means (a) all Interests (other than Pledged Interests) of
the Issuers, and all securities convertible or exchangeable into, and all
warrants, options, or other rights to purchase, Interests of the Issuers; and
(b) the certificates or instruments representing such Interests, convertible or
exchangeable securities, warrants, and other rights and all dividends, cash,
options, warrants, rights, instruments, and other property or proceeds from time
to time received, receivable, or otherwise distributed in respect of or in
exchange for any or all of such Interests.
"Interests" means all securities, shares, units, options, warrants,
interests, participations, or other equivalents (regardless of how designated)
of or in a corporation, partnership, limited liability company, or similar
entity, whether voting or nonvoting, certificated or uncertificated, including
general partner partnership interests, limited partner partnership interests,
common stock, preferred stock, limited liability company membership interests,
or any other "equity security" (as such term is defined in Rule 3a11-1 of the
General Rules and Regulations promulgated by the Securities and Exchange
Commission under the Securities Exchange Act of 1934).
"Issuer Acknowledgement" is defined in Section 3(f).
"Issuers" means each of the Persons identified as an Issuer in Schedule 1,
and any successors thereto, whether by merger or otherwise.
"Lenders" is defined in the Loan Agreement.
"Loan Agreement" is defined in the Preliminary Statements.
"Loan Documents" is defined in the Loan Agreement.
"Loans" is defined in the Loan Agreement.
"Other Holder" is defined in Section 3(c).
"Person" is defined in the Loan Agreement.
"Pledged Interests" means (a) all Interests of the Issuers identified in
Schedule 1 and (b) the certificates or instruments, if any, representing such
Interests.
"Pledgor" is defined in the introductory paragraph.
"Proceeds" means all proceeds (including proceeds of proceeds) of the
Pledged Interests and Future Rights, including all: (a) rights, benefits,
distributions, premiums, profits, dividends, interest, cash, instruments,
documents of title, accounts, contract rights, inventory, equipment, general
intangibles, payment intangibles, deposit accounts, chattel paper, and other
property from time to time received, receivable, or otherwise distributed in
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respect of or in exchange for, or as a replacement of or a substitution for, any
of the Pledged Interests, Future Rights, or proceeds thereof (including any
cash, Interests, or other securities or instruments issued after any
recapitalization, readjustment, reclassification, merger or consolidation with
respect to the Issuers and any security entitlements, as defined in Section
8-102(a)(17) of the UCC, with respect thereto); (b) "proceeds," as such term is
defined in Section 9-102(a)(64) of the UCC; (c) proceeds of any insurance,
indemnity, warranty, or guaranty (including guaranties of delivery) payable from
time to time with respect to any of the Pledged Interests, Future Rights or
proceeds thereof; (d) payments (in any form whatsoever) made or due and payable
to the Pledgor from time to time in connection with any requisition,
confiscation, condemnation, seizure or forfeiture of all or any part of the
Pledged Interests, Future Rights, or proceeds thereof; and (e) other amounts
from time to time paid or payable under or in connection with any of the Pledged
Interests, Future Rights, or proceeds thereof.
"Registered Organization" shall have the meaning ascribed thereto in
Section 9-102(a)(70) of the UCC.
"Required Lenders" is defined in the Loan Agreement.
"Secured Obligations" means all liabilities, obligations, or undertakings
owing by any Borrower to the Lenders of any kind or description arising out of
or outstanding under, advanced or issued pursuant to, or evidenced by any of the
Loan Documents, irrespective of whether for the payment of money, whether direct
or indirect, absolute or contingent, due or to become due, voluntary or
involuntary, whether now existing or hereafter arising, and including all
interest (including interest that accrues after the filing of a case under the
Bankruptcy Code) and any and all costs, fees (including reasonable attorneys'
fees), and expenses that any Borrower is required to pay pursuant to any of the
foregoing, by law, or otherwise.
"Secured Party" is defined in the introductory paragraph.
"Securities Act" is defined in Section 9(b).
"UCC" means the Uniform Commercial Code as in effect in the State of New
York, the State of Maryland, or any other applicable jurisdiction.
2. Pledge.
As security for the prompt payment and performance of the Secured
Obligations in full by the Borrowers when due, whether at stated maturity, by
acceleration or otherwise (including amounts that would become due but for the
operation of the provisions of the Bankruptcy Code), the Pledgor hereby pledges,
grants, transfers, and assigns to the Secured Party a security interest in all
of the Pledgor's right, title, and interest in and to the Collateral.
3. Delivery and Registration of Collateral.
(a) All certificates and other instruments and documents representing or
evidencing the Collateral shall be promptly delivered by the Pledgor to the
Secured Party or the Secured Party's designee pursuant hereto at a location
designated by the Secured Party and shall be held by or on behalf of the Secured
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Party pursuant hereto, and shall be in suitable form for transfer by delivery,
or shall be accompanied by duly executed indorsement certificates in the form
attached hereto as Exhibit 3(a) (in the case of Pledged Interests or Future
Rights) or other instrument of transfer or assignment or indorsement in blank,
in form and substance satisfactory to the Secured Party.
(b) Subject to Section 9(d), upon the occurrence and during the continuance
of an Event of Default, the Secured Party shall have the right, at any time in
its discretion and without notice to the Pledgor, to transfer to or to register
on the books of the Issuers (or of any other Person maintaining records with
respect to the Collateral) in the name of the Secured Party or any of its
nominees any or all of the Collateral consisting of Pledged Interests or Future
Rights. In addition, the Secured Party shall have the right at any time to
exchange certificates or instruments representing or evidencing Collateral for
certificates or instruments of smaller or larger denominations.
(c) If, at any time and from time to time, any Collateral (including any
certificate or other instrument or document representing or evidencing any
Collateral) is in the possession of a Person other than the Secured Party or the
Pledgor (an "Other Holder"), then the Pledgor shall immediately, at the Secured
Party's option, either cause such Collateral to be delivered into the Secured
Party's possession, or cause such Other Holder to enter into a control
agreement, in form and substance reasonably satisfactory to the Secured Party,
and take all other steps deemed necessary by the Secured Party to perfect the
security interest of the Secured Party in such Collateral, all pursuant to
Sections 9-106 and 9-313 of the UCC or other applicable law governing the
perfection of the Secured Party's security interest in the Collateral in the
possession of such Other Holder.
(d) Any and all Collateral (including dividends, interest, principal, and
other distributions, whether in cash or other property) at any time received or
held by the Pledgor shall be so received or held in trust for the Secured Party,
shall be segregated from other funds and property of the Pledgor and shall be
forthwith delivered to the Secured Party in the same form as so received or
held, with any necessary indorsements, provided that cash payments, dividends,
or distributions received by the Pledgor, may be retained by the Pledgor in
accordance with Section 4(a) and used in the ordinary course of the Pledgor's
business.
(e) If at any time, and from time to time, any Collateral consists of an
uncertificated security or a security in book entry form, then the Pledgor shall
immediately cause such Collateral to be registered or entered, as the case may
be, in the name of the Secured Party, or otherwise cause the Secured Party's
security interest thereon to be perfected in accordance with applicable law.
(f) Concurrently with the execution and delivery of this Agreement, the
Pledgor shall deliver to the Secured Party an acknowledgment in the form
attached hereto as Exhibit 3(f) (each an "Issuer Acknowledgement") duly executed
by each Issuer.
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4. Voting Rights; Payments, Dividends, and Distributions.
(a) So long as no Event of Default (after taking into account any
applicable grace or cure period) shall have occurred and be continuing, the
Pledgor shall be entitled to exercise any and all voting and other consensual
rights pertaining to the Collateral or any part thereof for any purpose not
inconsistent with the terms of the Loan Documents and shall be entitled to
receive and retain any cash payments, dividends, or distributions paid or
distributed in respect of the Collateral.
(b) Upon the occurrence and during the continuance of an Event of Default
(after taking into account any applicable grace or cure period), all rights of
the Pledgor to exercise the voting and other consensual rights or receive and
retain cash payments, dividends, or distributions that it would otherwise be
entitled to exercise or receive and retain, as applicable pursuant to Section
4(a), shall cease, and all such rights shall thereupon become vested in the
Secured Party, who shall thereupon have the sole right to exercise such voting
or other consensual rights and to receive and retain such cash payments,
dividends, and distributions. The Pledgor shall execute and deliver (or cause to
be executed and delivered) to the Secured Party all such proxies and other
instruments as the Secured Party may reasonably request for the purpose of
enabling the Secured Party to exercise the voting and other rights that it is
entitled to exercise and to receive the payments, dividends, and distributions
that it is entitled to receive and retain pursuant to the preceding sentence.
5. Representations and Warranties.
The Pledgor represents, warrants, and covenants as follows:
(a) The Pledgor has taken all steps it deems necessary or appropriate to be
informed on a continuing basis of changes or potential changes affecting the
Collateral (including rights of conversion and exchange, rights to subscribe,
payment of dividends, reorganizations or recapitalization, tender offers and
voting and registration rights), and the Pledgor agrees that the Secured Party
shall have no responsibility or liability for informing the Pledgor of any such
changes or potential changes or for taking any action or omitting to take any
action with respect thereto.
(b) The Pledgor is a Registered Organization, organized under the laws of
the State of Maryland.
(c) All information herein or hereafter supplied to the Secured Party or
any Lender by or on behalf of the Pledgor in writing with respect to the
Collateral is, or in the case of information hereafter supplied will be,
accurate and complete in all material respects.
(d) The Pledgor is and will be the sole legal and beneficial owner of the
Collateral (including the Pledged Interests and all other Collateral acquired by
the Pledgor after the date hereof) free and clear of any adverse claim, Lien, or
other right, title, or interest of any party, other than the Liens in favor of
the Secured Party.
(e) This Agreement, and the delivery to the Secured Party of the Pledged
Interests representing Collateral (or the control agreements referred to in
Section 3(c)), creates a valid, perfected, and first priority security interest
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in 100% of the Pledged Interests in favor of the Secured Party securing payment
of the Secured Obligations, and all actions necessary to achieve such perfection
have been duly taken.
(f) Schedule 1 is true and correct and complete in all material respects.
Without limiting the generality of the foregoing: (i) except as set forth in
Schedule 1, all the Pledged Interests are in certificated form, and, except to
the extent registered in the name of the Secured Party or its nominee pursuant
to the provisions of this Agreement, are registered in the name of the Pledgor;
and (ii) the Pledged Interests as to each of the Issuers constitute at least the
percentage of all the fully diluted issued and outstanding Interests of such
Issuer as set forth in Schedule 1.
(g) There are no presently existing Future Rights or Proceeds owned by the
Pledgor.
(h) The Pledged Interests have been duly authorized and validly issued and
are fully paid and nonassessable.
(i) Neither the pledge of the Collateral pursuant to this Agreement nor the
extensions of credit represented by the Secured Obligations violates Regulation
T, U or X of the Board of Governors of the Federal Reserve System.
6. Further Assurances.
(a) The Pledgor agrees that from time to time, at the expense of the
Pledgor, the Pledgor will promptly execute and deliver all further instruments
and documents, and take all further action that may be necessary or reasonably
desirable, or that the Secured Party may reasonably request, in order to perfect
and protect any security interest granted or purported to be granted hereby or
to enable the Secured Party to exercise and enforce its rights and remedies
hereunder with respect to any Collateral. Without limiting the generality of the
foregoing, the Pledgor will: (i) at the request of the Secured Party, xxxx
conspicuously each of its records pertaining to the Collateral with a legend, in
form and substance reasonably satisfactory to the Secured Party, indicating that
such Collateral is subject to the security interest granted hereby; (ii) execute
any such instruments or notices, as may be necessary or reasonably desirable, or
as the Secured Party may reasonably request, in order to perfect and preserve
the first priority security interests granted or purported to be granted hereby;
(iii) allow inspection of the Collateral by the Secured Party or Persons
designated by the Secured Party; and (iv) appear in and defend any action or
proceeding that may affect the Pledgor's title to or the Secured Party's
security interest in the Collateral.
(b) The Pledgor hereby authorizes the Secured Party to file one or more
financing or continuation statements, and amendments thereto, relative to all or
any part of the Collateral. A carbon, photographic, or other reproduction of
this Agreement or any financing statement covering the Collateral or any part
thereof shall be sufficient as a financing statement where permitted by law.
(c) The Pledgor will furnish to the Secured Party, upon the request of the
Secured Party: (i) a certificate executed by an authorized officer of the
Pledgor, and dated as of the date of delivery to the Secured Party, itemizing in
such detail as the Secured Party may reasonably request, the Collateral that, as
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of the date of such certificate, has been delivered to the Secured Party by the
Pledgor pursuant to the provisions of this Agreement; and (ii) such statements
and schedules further identifying and describing the Collateral and such other
reports in connection with the Collateral as the Secured Party may reasonably
request.
7. Covenants of the Pledgor.
The Pledgor shall:
(a) neither change its jurisdiction of organization nor cease to be a
Registered Organization, in each case, without giving the Secured Party at least
30 days prior written notice thereof;
(b) to the extent it may lawfully do so, use diligent efforts to prevent
the Issuers from issuing Future Rights or Proceeds, except for cash dividends
and other distributions to be paid by any Issuer to the Pledgor; and
(c) upon receipt by the Pledgor of any material notice, report, or other
communication from any of the Issuers or any Other Holder, in each case relating
to all or any part of the Collateral, deliver such notice, report or other
communication to the Secured Party as soon as practicable, but in no event later
than five Business Days following the receipt thereof by the Pledgor.
8. The Secured Party as the Pledgor's Attorney-in-Fact.
(a) The Pledgor hereby irrevocably appoints the Secured Party as the
Pledgor's attorney-in-fact, with full authority in the place and stead of the
Pledgor and in the name of the Pledgor, the Secured Party or otherwise, from
time to time at the Secured Party's discretion, to take any action and to
execute any instrument that the Secured Party may reasonably deem necessary or
advisable to accomplish the purposes of this Agreement, including: (i) upon the
occurrence and during the continuance of an Event of Default (after taking into
account any applicable grace or cure period), to receive, indorse, and collect
all instruments made payable to the Pledgor representing any dividend, interest
or principal payment, or other distribution in respect of the Collateral or any
part thereof to the extent permitted hereunder and to give full discharge for
the same and to execute and file governmental notifications and reporting forms;
(ii) to enter into any control agreements the Secured Party deems necessary
pursuant to Section 3(c); or (iii) subject to Section 9(d), to arrange for the
transfer of the Collateral on the books of any of the Issuers or any other
Person to the name of the Secured Party or to the name of the Secured Party's
nominee.
(b) In addition to the designation of the Secured Party as the Pledgor's
attorney-in-fact in Section 8(a), the Pledgor hereby irrevocably appoints the
Secured Party as the Pledgor's Secured Party and attorney-in-fact to make,
execute and deliver any and all documents and writings that may be necessary or
appropriate, subject to Section 9(d), for approval of, or be required by, any
regulatory authority located in any city, county, state or country where the
Pledgor or any of the Issuers engages in business, in order to transfer or to
more effectively transfer any of the Pledged Interests or otherwise enforce the
Secured Party's rights hereunder.
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9. Remedies upon Default.
Upon the occurrence and during the continuance of an Event of Default
(after taking into account any applicable grace or cure period):
(a) The Secured Party may exercise in respect of the Collateral, in
addition to other rights and remedies provided for herein or otherwise available
to it, all the rights and remedies of a secured party on default under the UCC
(irrespective of whether the UCC applies to the affected items of Collateral),
and the Secured Party may also without notice (except as specified below) sell
the Collateral or any part thereof in one or more parcels at public or private
sale, at any exchange, broker's board or at any of the Secured Party's offices
or elsewhere, for cash, on credit or for future delivery, at such time or times
and at such price or prices and upon such other terms as the Secured Party may
deem commercially reasonable, irrespective of the impact of any such sales on
the market price of the Collateral. To the maximum extent permitted by
applicable law, the Secured Party or any Lender may be the purchaser of any or
all of the Collateral at any such sale and shall be entitled, for the purpose of
bidding and making settlement or payment of the purchase price for all or any
portion of the Collateral sold at any such public sale, to use and apply all or
any part of the Secured Obligations as a credit on account of the purchase price
of any Collateral payable at such sale. Each purchaser at any such sale shall
hold the property sold absolutely free from any claim or right on the part of
the Pledgor, and, subject to Section 9(d), the Pledgor hereby waives (to the
extent permitted by law) all rights of redemption, stay, or appraisal that it
now has or may at any time in the future have under any rule of law or statute
now existing or hereafter enacted. The Pledgor agrees that, to the extent notice
of sale shall be required by law, at least ten calendar days notice to the
Pledgor of the time and place of any public sale or the time after which a
private sale is to be made shall constitute reasonable notification. The Secured
Party shall not be obligated to make any sale of Collateral regardless of notice
of sale having been given. The Secured Party may adjourn any public sale from
time to time by announcement at the time and place fixed therefor, and such sale
may, without further notice, be made at the announced time and place to which it
was so adjourned.
(b) The Pledgor hereby acknowledges that the sale by the Secured Party of
any Collateral pursuant to the terms hereof in compliance with the Securities
Act of 1933 as now in effect or as hereafter amended, or any similar statute
hereafter adopted with similar purpose or effect (the "Securities Act"), as well
as applicable "blue sky" or other state securities laws, may require strict
limitations as to the manner in which the Secured Party or any subsequent
transferee of the Collateral may dispose thereof. The Pledgor acknowledges and
agrees that in order to protect the Secured Party's interest it may be necessary
to sell the Collateral at a price less than the maximum price attainable if a
sale were delayed or were made in another manner, such as a public offering
under the Securities Act. The Pledgor agrees that, subject to Section 9(d), upon
the occurrence and during the continuation of an Event of Default (after taking
into account any applicable grace or cure period), the Secured Party may,
subject to applicable law, from time to time attempt to sell all or any part of
the Collateral by a private placement, restricting the bidders and prospective
purchasers to those who will represent and agree that they are purchasing for
investment only and not for distribution. In so doing, the Secured Party may
solicit offers to buy the Collateral or any part thereof for cash, from a
limited number of investors reasonably believed by the Secured Party to be
institutional investors or other accredited investors who might be interested in
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purchasing the Collateral. If the Secured Party shall solicit such offers, then
the acceptance by the Secured Party of one of the offers shall be deemed to be a
commercially reasonable method of disposition of the Collateral.
(c) If the Secured Party shall determine to exercise its right to sell all
or any portion of the Collateral pursuant to this Section, the Pledgor agrees
that, upon request of the Secured Party, the Pledgor will, at its own expense:
(i) use diligent efforts to execute and deliver, and cause the Issuers
and the officers, directors, managers, partners, agents and authorized
representatives thereof to execute and deliver, all such instruments and
documents, and to do or cause to be done all such other acts and things, as
may be necessary or, in the opinion of the Secured Party, advisable to
register such Collateral under the provisions of the Securities Act, and to
cause the registration statement relating thereto to become effective and
to remain effective for such period as prospectuses are required by law to
be furnished, and to make all amendments and supplements thereto and to the
related prospectuses that, in the opinion of the Secured Party, are
necessary or advisable, all in conformity with the requirements of the
Securities Act and the rules and regulations of the Securities and Exchange
Commission applicable thereto;
(ii) use diligent efforts to qualify the Collateral under the state
securities laws or "blue sky" laws and to obtain all necessary governmental
approvals for the sale of the Collateral, as reasonably requested by the
Secured Party;
(iii) cause the Issuers to make available to their respective security
holders, as soon as practicable, an earnings statement that will satisfy
the provisions of section 11(a) of the Securities Act;
(iv) execute and deliver, or cause the officers, directors, managers,
partners, agents and authorized representatives of the Issuers to execute
and deliver, to any Person as the Secured Party may choose, any and all
documents and writings that, in the Secured Party's reasonable judgment,
may be necessary or appropriate for approval, or be required by, any
regulatory authority located in any city, county, state or country where
the Pledgor or the Issuers engage in business, in order to transfer or to
more effectively transfer the Pledged Interests or otherwise enforce the
Secured Party's rights hereunder; and
(v) do or cause to be done all such other acts and things as may be
necessary to make such sale of the Collateral or any part thereof valid and
binding and in compliance with applicable law.
The Pledgor acknowledges that there is no adequate remedy at law for
failure by it to comply with the provisions of this Section and that such
failure would not be adequately compensable in damages, and therefore agrees
that its agreements contained in this Section may be specifically enforced.
(d) Notwithstanding the foregoing provisions of this Section 9, or any other
provisions of this Agreement or any other Loan Document, the Secured Party
agrees to refrain from exercising its remedies set forth in this Section 9 with
respect to the Collateral, including the right to sell or otherwise transfer the
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Collateral, under the circumstances and for the periods of time specified below
in this Section 9(d):
(i) Upon the occurrence of and during the continuance of any Curable Lease
Default (as defined in the Assignment of Leases and Rents), if the Borrowers are
not otherwise in default under the Loan Documents beyond any applicable grace or
cure period, Secured Party shall provide Pledgor a period of up to 90 days from
the occurrence of such Curable Lease Default to cure such Curable Lease Default
or prepay or pay the Loans and all other Secured Obligations in full, but not in
part, prior to Secured Party exercising any remedies specified in this Section
9; and
(ii) Upon the occurrence of and during the continuance of any other Event
of Default (after taking into account any applicable grace or cure period),
other than an Event of Default of the type described in Sections 8.1 (a) or (b)
of the Loan Agreement, Secured Party shall provide Pledgor a period of up to 90
Day from the occurrence of such Event of Default to cure such Event of Default
or prepay or pay the Loans and all other Secured Obligations in full, but not in
part, prior to Secured Party exercising any remedies specified in this Section
9, provided that Secured Party shall determine in its sole discretion that such
delay in exercising such remedies will not prejudice Secured Party's ability to
collect the Loans and the other Secured Obligations or to realize on the
Collateral following such delay or result in any diminution in the value of the
Collateral.
(e) THE PLEDGOR EXPRESSLY WAIVES TO THE MAXIMUM EXTENT PERMITTED BY LAW:
(i) ANY CONSTITUTIONAL OR OTHER RIGHT TO A JUDICIAL HEARING PRIOR TO THE TIME
THE SECURED PARTY DISPOSES OF ALL OR ANY PART OF THE COLLATERAL AS PROVIDED IN
THIS SECTION 9; (ii) ALL RIGHTS OF REDEMPTION, STAY, OR APPRAISAL THAT IT NOW
HAS OR MAY AT ANY TIME IN THE FUTURE HAVE UNDER ANY RULE OF LAW OR STATUTE NOW
EXISTING OR HEREAFTER ENACTED; AND (iii) EXCEPT AS SET FORTH IN SUBSECTION (a)
OF THIS SECTION 9, ANY REQUIREMENT OF NOTICE, DEMAND, OR ADVERTISEMENT FOR SALE.
10. Application of Proceeds.
Upon the occurrence and during the continuance of an Event of Default, any
cash held by the Secured Party as Collateral and all cash Proceeds received by
the Secured Party in respect of any sale of, collection from, or other
realization upon all or any part of the Collateral pursuant to the exercise by
the Secured Party of its remedies as a secured creditor as provided in Section 9
shall be applied from time to time by the Secured Party as follows: first, to
the payment of the Secured Party's and the Lenders' reasonable costs and
expenses in connection with the Collateral, including reasonable attorneys' fees
and legal expenses; second, to the payment of all other Secured Obligations in
such manner as the Required Lenders may deem advisable; and third, the balance,
if any, to or at the direction of the Pledgor. The Pledgor shall remain liable
for any deficiency.
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11. Indemnity and Expenses.
The Pledgor agrees:
(a) To indemnify and hold harmless the Secured Party and each Lender and
each of their respective officers, directors, managers, employees, agents,
professional advisors and affiliates from and against any and all claims,
damages, demands, losses, obligations, judgments and liabilities (including
reasonable attorneys' fees and expenses) in any way arising out of or in
connection with this Agreement or the Secured Obligations, except to the extent
the same shall arise as a result of the gross negligence or willful misconduct
of the party seeking to be indemnified; and
(b) To pay and reimburse the costs and expenses of the Secured Party and
the Lenders referred to in Section 9.2 of the Loan Agreement.
12. Duties of the Secured Party.
The powers conferred on the Secured Party hereunder are solely to protect
its interests in the Collateral and shall not impose on it any duty to exercise
such powers. Except as provided in Section 9-207 of the UCC, the Secured Party
shall have no duty with respect to the Collateral or any responsibility for
taking any steps necessary or advisable to preserve rights against any Persons
with respect to any Collateral.
13. Amendments; etc.
No amendment or waiver of any provision of this Agreement nor consent to
any departure by the Pledgor herefrom shall in any event be effective unless the
same shall be in writing and signed by the Secured Party and consented to by the
Required Lenders, and then such waiver or consent shall be effective only in the
specific instance and for the specific purpose for which given. No failure on
the part of the Secured Party to exercise, and no delay in exercising any right
under this Agreement, any other Loan Document, or otherwise with respect to any
of the Secured Obligations, shall operate as a waiver thereof; nor shall any
single or partial exercise of any right under this Agreement, any other Loan
Document, or otherwise with respect to any of the Secured Obligations preclude
any other or further exercise thereof or the exercise of any other right. The
remedies provided for in this Agreement or otherwise with respect to any of the
Secured Obligations are cumulative and not exclusive of any remedies provided by
law.
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14. Continuing Security Interest.
This Agreement shall create a continuing security interest in the
Collateral and shall remain in full force and effect until the indefeasible
payment in full of the Secured Obligations, including the full and final
termination of any commitment to extend any financial accommodations under the
Loan Agreement. Upon the indefeasible payment in full of the Secured
Obligations, including the full and final termination of any commitment to
extend any financial accommodations under the Loan Agreement, the security
interests granted herein shall automatically terminate and all rights to the
Collateral shall revert to the Pledgor. Upon any such termination, the Secured
Party will, at the Pledgor's expense, execute and deliver to the Pledgor such
documents as the Pledgor shall reasonably request to evidence such termination.
Such documents shall be prepared by the Pledgor and shall be in form and
substance reasonably satisfactory to the Secured Party.
15. Security Interest Absolute.
To the maximum extent permitted by law, all rights of the Secured Party,
all security interests hereunder, and all obligations of the Pledgor
hereunder, shall be absolute and unconditional irrespective of:
(a) any lack of validity or enforceability of any agreement or instrument
relating to any of the Secured Obligations, including any of the Loan Documents;
(b) any change in the time, manner, or place of payment of, or in any other
term of, all or any of the Secured Obligations, or any other amendment or waiver
of or any consent to any departure from any of the Loan Documents, or any other
agreement or instrument relating thereto;
(c) any exchange, release, or non-perfection of any other collateral, or
any release or amendment or waiver of or consent to departure from any guaranty
for all or any of the Secured Obligations; or
(d) any other circumstances that might otherwise constitute a defense
available to, or a discharge of, the Pledgor.
16. Waiver of Marshaling.
Each of the Pledgor and the Secured Party acknowledges and agrees that in
exercising any rights under or with respect to the Collateral, the Secured
Party: (a) is under no obligation to marshal any Collateral; (b) may, in its
absolute discretion, realize upon the Collateral in any order and in any manner
it so elects; and (c) may, in its absolute discretion, apply the proceeds of any
or all of the Collateral to the Secured Obligations in any order and in any
manner it so elects. The Pledgor and the Secured Party waive any right to
require the marshaling of any of the Collateral.
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17. Miscellaneous.
(a) Notices.
All notices and communications provided for hereunder shall be in writing
and sent (i) by telecopy if the sender on the same day sends a confirming copy
of such notice by a recognized overnight delivery service (charges prepaid), or
(ii) by registered or certified mail with return receipt requested (postage
prepaid), or (iii) by a recognized overnight delivery service (with charges
prepaid). Any such notice or must be sent:
(i) if to the Pledgor, to GTJ REIT, Inc., 000 Xxxxxxx Xxxx, Xxxxxxxx,
XX 00000, Attention: President, Telecopy No. (000) 000-0000, with a copy to
Ruskin Moscou Faltischek, P.C., 0000 XxxXxxx Xxxxx, Xxxxxxxxx, X.X. 00000,
Attention: Xxxxxx X. Xxxxxx, Esq., or at such other address as the Pledgor
shall have specified to each other party hereto in writing; or
(ii) if to the Secured Party, to the address of each Lender specified
for such purpose in the Loan Agreement (taking into account, as applicable,
Section 9.12 of the Loan Agreement), or at such other address as the
Secured Party shall have specified to each of the other parties to the Loan
Documents in writing.
Notices under this Section 17(a) will be deemed given only when actually
received.
(b) Successors and Assigns.
All covenants and other agreements contained in this Agreement by or on
behalf of any of the parties hereto bind and inure to the benefit of their
respective successors and assigns (including any successor to the Secured Party
under the Loan Documents) whether so expressed or not.
(c) Severability.
Any provision of this Agreement that is prohibited or unenforceable in any
jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such prohibition or unenforceability without invalidating the remaining
provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall (to the full extent permitted by law) not invalidate or
render unenforceable such provision in any other jurisdiction.
(d) Construction.
In this Agreement, unless a clear contrary intention appears (i) the
singular number includes the plural number and vice versa; (ii) reference to any
gender includes each other gender; (iii) reference to any agreement, document or
instrument means such agreement, document or instrument as amended or modified
and in effect from time to time in accordance with the terms thereof; (iv) any
reference herein to any Person shall be construed to include such Person's
successors and assigns or, if such Person is an individual, to such Person's
heirs, legal representatives and assigns; (v) references to Sections, Schedules
or Exhibits refer to the Sections, Schedules and Exhibits of or to this
Agreement and "hereunder," "hereof," "hereto," and words of similar import shall
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be deemed references to this Agreement as a whole and not to any particular
Section or other provision hereof; (vi) "including" and "include" do not limit
the generality of any description preceding such term; (vii) "or" is used in the
inclusive sense of "and/or"; and (viii) references to documents, instruments or
agreements shall be deemed to refer as well to all addenda, exhibits, schedules,
supplements or amendments thereto. Each covenant contained in the Loan Documents
shall be construed (absent express provision to the contrary) as being
independent of each other covenant contained in the Loan Documents, so that
compliance with any one covenant shall not (absent such an express contrary
provision) be deemed to excuse compliance with any other covenant. Where any
provision in any Loan Document refers to action to be taken by any Person, or
that such Person is prohibited from taking, such provision shall be applicable
whether such action is taken directly or indirectly by such Person.
(e) Counterparts; Execution and Delivery by Facsimile or E-mail.
This Agreement may be executed in any number of counterparts, each of which
shall be an original but all of which together shall constitute one instrument.
Each counterpart may consist of a number of copies hereof, each signed by less
than all, but together signed by all, of the parties hereto. Delivery of an
executed counterpart of this Agreement by facsimile or by e-mail of a PDF file
or similar electronic image file shall be equally as effective as delivery of an
original executed counterpart of this Agreement. Any party delivering an
executed counterpart of this Agreement by facsimile or by e-mail also shall
deliver an original executed counterpart of this Agreement, but the failure to
deliver an original executed counterpart shall not affect the validity,
enforceability, or binding effect hereof.
(f) Waiver of Jury Trial.
EACH PARTY HERETO HEREBY IRREVOCABLY, KNOWINGLY, VOLUNTARILY, AND
INTENTIONALLY WAIVES ANY RIGHTS IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY
LITIGATION BASED HEREON, OR ARISING OUT OF, UNDER, OR IN CONNECTION WITH, THIS
AGREEMENT, OR ANY COURSE OF CONDUCT, COURSE OF DEALING OR STATEMENTS (WHETHER
ORAL OR WRITTEN) RELATING TO THE FOREGOING. THIS PROVISION IS A MATERIAL
INDUCEMENT FOR THE PARTIES TO ENTER INTO THIS AGREEMENT AND FOR THE LENDERS TO
ENTER INTO THE LOAN AGREEMENT.
(g) Governing Law.
This Agreement shall be construed and enforced in accordance with, and the
rights of the parties shall be governed by, the law of the State of New York
excluding choice-of-law principles of the law of such State that would require
the application of the laws of a jurisdiction other than such State.
ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT OR THE LOAN
DOCUMENTS MAY BE BROUGHT IN THE COURTS OF THE STATE OF NEW YORK OR OF THE UNITED
STATES FOR THE SOUTHERN DISTRICT OF SUCH STATE, AND BY EXECUTION AND DELIVERY OF
THIS AGREEMENT, EACH PLEDGOR SUBMITS TO THE NON-EXCLUSIVE JURISDICTION OF THOSE
COURTS. EACH PLEDGOR IRREVOCABLY WAIVES ANY OBJECTION, INCLUDING ANY OBJECTION
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TO THE LAYING OF VENUE OR BASED ON THE GROUNDS OF FORUM NON CONVENIENS, THAT IT
MAY NOW OR HEREAFTER HAVE TO THE BRINGING OF ANY ACTION OR PROCEEDING IN SUCH
JURISDICTION IN RESPECT OF ANY OF THE LOAN DOCUMENTS OR ANY OTHER DOCUMENT
RELATED THERETO, INCLUDING THIS AGREEMENT. EACH PLEDGOR WAIVES PERSONAL SERVICE
OF ANY SUMMONS, COMPLAINT OR OTHER PROCESS, WHICH MAY BE MADE BY ANY OTHER MEANS
PERMITTED BY THE LAW OF SUCH STATE.
[Remainder of page intentionally left blank; signature page follows]
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IN WITNESS WHEREOF, the Pledgor has executed this Agreement as of the date
first written above.
Pledgor: GTJ REIT, INC.
By:____________________________
Name:
Title:
Signature Page to Pledge and Security Agreement
Schedule 1
----------
Pledged Interests
Name of Pledgor: GTJ REIT, INC.
Issuer Type of Entity and
Jurisdiction of
Organization or
Type of Certified/
Arrangement Pledged Interest Uncertified
41738944.6
Exhibit 3(a)
------------
{FORM OF INDORSEMENT CERTIFICATE}
FOR VALUE RECEIVED, the undersigned does hereby sell, assign and transfer
unto ______________________________, {_______________________ (________) shares
of the __________ Stock of} {a _____________________ percent (____%) ownership
interest in} {_______________________ (________) units of the ____________
partnership interests in} {modify preceding as appropriate} (the "Issuer")
standing in the undersigned's name on the books of the Issuer represented by
Certificate No(s). ___________, and does hereby irrevocably constitute and
appoint as the undersigned's attorney-in-fact to transfer the said
_________________ on the books of the Issuer with full power of substitution in
the premises.
Date:_______________________
GTJ REIT, INC.
By:__________________________
Name:
Title:
Exhibit 3(f)
------------
[FORM OF ISSUER ACKNOWLEDGEMENT]
Issuer Acknowledgement
----------------------
{Date}
{Name and address of Secured Party}
Reference is made to the Pledge and Security Agreement dated as of
{______________, 2007} (the "Pledge Agreement"), by GTJ REIT, INC., a Maryland
corporation (the "Pledgor"), in favor of ING USA ANNUITY AND LIFE INSURANCE
COMPANY, ING LIFE INSURANCE AND ANNUITY COMPANY, RELIASTAR LIFE INSURANCE
COMPANY, and SECURITY LIFE OF DENVER INSURANCE COMPANY (individually and
collectively, the "Secured Party"). This Issuer Acknowledgement relates to those
Interests (the "Pledged Interests") in the entities listed on Schedule I
attached hereto (each, an "Issuer"). Each Issuer hereby acknowledges that the
Pledged Interest in such Issuer has been pledged by the Pledgor to the Secured
Party in accordance with the Pledge Agreement. Capitalized terms used herein and
not otherwise defined are sued as defined in the Pledge Agreement.
Each Issuer agrees that, in the event that the Pledged Interest with
respect to such Issuer should be determined to be a security (within the meaning
of Sections 8-102(a)(15) and 8-103 of the UCC), and for purposes of perfecting
the security interest of the Secured Party therein:
On the date hereof, the owner of the Pledged Interest in such Issuer is the
Pledgor.
The registered pledgees of the Pledged Interests are:
{Insert name and address of secured parties}
{Remainder of page intentionally left blank; signature page follows}
1
IN WITNESS WHEREOF, each of the undersigned Issuers has executed this
Issuer Acknowledgment as of the date first written above.
{ISSUER} {ISSUER}
By:____________________________ By:____________________________
Name: Name:
Title: Title:
{ISSUER}
By:____________________________
Name:
Title:
2
SCHEDULE I
TO
ISSUER ACKNOWLEDGEMENT
Pledged Interests
-----------------
Issuer Pledged Interest
3
