EXHIBIT 10.13
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LOAN AGREEMENT
Dated as of November 1, 0000
Xxxxxxx
XXXXX-XXXXXXXX XXXXXXX LLC,
as Borrower
and
EUROHYPO AG, NEW YORK BRANCH,
as Lender
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TABLE OF CONTENTS
Page
I. DEFINITIONS; PRINCIPLES OF CONSTRUCTION....................................................................1
Section 1.1 Definitions.....................................................................................1
Section 1.2 Principles of Construction.....................................................................16
II. THE LOAN..................................................................................................17
Section 2.1 The Loan.......................................................................................17
2.1.1 Agreement to Lend and Borrow.................................................................17
2.1.2 Single Disbursement to Borrower..............................................................17
2.1.3 The Note.....................................................................................17
2.1.4 Use of Proceeds..............................................................................17
Section 2.2 Interest Rate..................................................................................17
2.2.1 Interest Rate................................................................................17
2.2.2 Intentionally Omitted........................................................................17
2.2.3 Default Rate.................................................................................17
2.2.4 Interest Calculation.........................................................................17
2.2.5 Usury Savings................................................................................17
Section 2.3 Loan Payments..................................................................................18
2.3.1 Payment Before Maturity Date.................................................................18
2.3.2 Intentionally Omitted........................................................................18
2.3.3 Payment on Maturity Date.....................................................................18
2.3.4 Late Payment Charge..........................................................................18
2.3.5 Method and Place of Payment..................................................................18
Section 2.4 Prepayments....................................................................................19
2.4.1 Voluntary Prepayments........................................................................19
2.4.2 Mandatory Prepayments........................................................................19
2.4.3 Prepayments After Default....................................................................19
Section 2.5 Defeasance.....................................................................................19
2.5.1 Total Defeasance.............................................................................19
2.5.2 Partial Defeasance...........................................................................21
2.5.3 Defeasance Collateral Account................................................................24
2.5.4 Successor Borrower...........................................................................25
Section 2.6 Foreign Lenders................................................................................25
III. REPRESENTATIONS AND WARRANTIES............................................................................26
Section 3.1 Borrower Representations.......................................................................26
3.1.1 Organization.................................................................................26
3.1.2 Proceedings..................................................................................26
3.1.3 No Conflicts.................................................................................27
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3.1.4 Litigation...................................................................................27
3.1.5 Agreements...................................................................................27
3.1.6 Consents.....................................................................................27
3.1.7 Title........................................................................................27
3.1.8 No Plan Assets...............................................................................27
3.1.9 Compliance...................................................................................28
3.1.10 Financial Information........................................................................28
3.1.11 Condemnation.................................................................................28
3.1.12 Utilities and Public Access..................................................................28
3.1.13 Separate Lots................................................................................28
3.1.14 Assessments..................................................................................28
3.1.15 No Defenses..................................................................................29
3.1.16 Assignment of Leases.........................................................................29
3.1.17 Insurance....................................................................................29
3.1.18 Licenses.....................................................................................29
3.1.19 Flood Zone...................................................................................29
3.1.20 Physical Condition...........................................................................29
3.1.21 Boundaries...................................................................................30
3.1.22 Leases.......................................................................................30
3.1.23 Filing and Recording Taxes...................................................................30
3.1.24 Single Purpose...............................................................................31
3.1.25 Tax Filings..................................................................................34
3.1.26 Solvency.....................................................................................34
3.1.27 Federal Reserve Regulations..................................................................34
3.1.28 Organizational Chart.........................................................................34
3.1.29 Investment Company Act.......................................................................34
3.1.30 Access/Utilities.............................................................................35
3.1.31 No Bankruptcy Filing.........................................................................35
3.1.32 Full and Accurate Disclosure.................................................................35
3.1.33 Foreign Person...............................................................................35
3.1.34 No Change in Facts or Circumstances; Disclosure..............................................35
3.1.35 Perfection of Accounts.......................................................................35
3.1.36 Intentionally Omitted........................................................................36
3.1.37 Intentionally Omitted........................................................................36
3.1.38 Patriot Act..................................................................................36
Section 3.2 Survival of Representations....................................................................36
IV. BORROWER COVENANTS........................................................................................36
Section 4.1 Borrower Affirmative Covenants.................................................................36
4.1.1 Existence; Compliance with Legal Requirements................................................37
4.1.2 Taxes and Other Charges......................................................................37
4.1.3 Litigation...................................................................................37
4.1.4 Access to Property...........................................................................37
4.1.5 Intentionally Omitted........................................................................37
4.1.6 Financial Reporting..........................................................................37
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4.1.7 Title to the Property........................................................................40
4.1.8 Estoppel Statement...........................................................................40
4.1.9 Leases.......................................................................................40
4.1.10 Alterations..................................................................................41
4.1.11 Intentionally Omitted........................................................................42
4.1.12 Material Agreements..........................................................................42
4.1.13 Performance by Borrower......................................................................42
4.1.14 Intentionally Omitted........................................................................42
4.1.15 Business and Operations......................................................................42
4.1.16 Loan Fees....................................................................................42
4.1.17 Intentionally Omitted........................................................................42
4.1.18 Handicapped Access...........................................................................42
4.1.19 Intentionally Omitted........................................................................43
4.1.20 Notice of Certain Events.....................................................................43
4.1.21 Further Assurances...........................................................................43
4.1.22 Taxes on Security............................................................................44
4.1.23 Stop and Shop Estoppel.......................................................................44
Section 4.2 Borrower Negative Covenants....................................................................44
4.2.1 Liens........................................................................................44
4.2.2 Dissolution..................................................................................44
4.2.3 Debt Cancellation............................................................................44
4.2.4 Zoning.......................................................................................45
4.2.5 No Joint Assessment..........................................................................45
4.2.6 Principal Place of Business..................................................................45
4.2.7 ERISA........................................................................................45
4.2.8 Material Agreements..........................................................................45
4.2.9 Intentionally Deleted........................................................................46
4.2.10 Intentionally Omitted........................................................................46
V. INSURANCE, CASUALTY AND CONDEMNATION......................................................................46
Section 5.1 Insurance......................................................................................46
5.1.1 Insurance Policies...........................................................................46
5.1.2 Insurance Company............................................................................50
Section 5.2 Casualty and Condemnation......................................................................50
5.2.1 Casualty.....................................................................................50
5.2.2 Condemnation.................................................................................51
5.2.3 Casualty Proceeds............................................................................51
Section 5.3 Delivery of Net Proceeds.......................................................................51
5.3.1 Minor Casualty or Condemnation...............................................................51
5.3.2 Major Casualty or Condemnation...............................................................52
VI. RESERVE FUNDS.............................................................................................55
Section 6.1 Required Repair Funds..........................................................................55
6.1.1 Deposit of Required Repair Funds.............................................................55
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6.1.2 Release of Required Repair Funds.............................................................55
Section 6.2 Tax Funds......................................................................................56
6.2.1 Deposits of Tax Funds........................................................................56
6.2.2 Release of Tax Funds.........................................................................56
Section 6.3 Insurance Funds................................................................................56
6.3.1 Deposits of Insurance Funds..................................................................56
6.3.2 Release of Insurance Funds...................................................................57
Section 6.4 Capital Expenditure Funds......................................................................57
6.4.1 Deposits of Capital Expenditure Funds........................................................57
6.4.2 Release of Capital Expenditure Funds.........................................................57
Section 6.5 Rollover Funds.................................................................................58
6.5.1 Deposits of Rollover Funds...................................................................58
6.5.2 Release of Rollover Funds....................................................................58
Section 6.6 Intentionally Deleted..........................................................................59
Section 6.7 Security Interest in Reserve Funds.............................................................59
6.7.1 Grant of Security Interest...................................................................59
6.7.2 Interest on Reserve Funds....................................................................59
6.7.3 Prohibition Against Further Encumbrance......................................................60
VII. PROPERTY MANAGEMENT.......................................................................................60
Section 7.1 The Management Agreement.......................................................................60
Section 7.2 Prohibition Against Termination or Modification................................................60
Section 7.3 Replacement of Manager.........................................................................61
VIII. TRANSFERS.................................................................................................61
Section 8.1 Prohibited Transfer or Encumbrance of Property.................................................61
Section 8.2 Permitted Transfers............................................................................63
8.2.1 Permitted Transfer of the Property...........................................................63
8.2.2 Permitted Transfer of Interest in Borrower...................................................64
Section 8.3 Substitute Guarantor...........................................................................64
IX. SALE AND SECURITIZATION OF MORTGAGE.......................................................................65
Section 9.1 Sale of Mortgage and Securitization............................................................65
Section 9.2 Securitization Indemnification.................................................................66
X. DEFAULTS..................................................................................................68
Section 10.1 Event of Default...............................................................................68
Section 10.2 Remedies.......................................................................................70
Section 10.3 Right to Cure Defaults.........................................................................72
Section 10.4 Remedies Cumulative............................................................................72
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XI. MISCELLANEOUS.............................................................................................72
Section 11.1 Successors and Assigns.........................................................................72
Section 11.2 Lender's Discretion............................................................................72
Section 11.3 Governing Law..................................................................................73
Section 11.4 Modification, Waiver in Writing................................................................74
Section 11.5 Delay Not a Waiver.............................................................................74
Section 11.6 Notices........................................................................................75
Section 11.7 Trial by Jury..................................................................................76
Section 11.8 Headings.......................................................................................76
Section 11.9 Severability...................................................................................76
Section 11.10 Preferences....................................................................................77
Section 11.11 Waiver of Notice...............................................................................77
Section 11.12 Remedies of Borrower...........................................................................77
Section 11.13 Expenses; Indemnity............................................................................77
Section 11.14 Schedules Incorporated.........................................................................78
Section 11.15 Offsets, Counterclaims and Defenses............................................................78
Section 11.16 No Joint Venture or Partnership; No Third Party Beneficiaries..................................79
Section 11.17 Publicity......................................................................................79
Section 11.18 Waiver of Marshalling of Assets................................................................79
Section 11.19 Waiver of Offsets/Defenses/Counterclaims.......................................................80
Section 11.20 Conflict; Construction of Documents; Reliance..................................................80
Section 11.21 Brokers and Financial Advisors.................................................................80
Section 11.22 Exculpation....................................................................................80
Section 11.23 Prior Agreements...............................................................................83
Section 11.24 Servicer.......................................................................................83
Section 11.25 Joint and Several Liability....................................................................83
Section 11.26 Creation of Security Interest..................................................................83
Section 11.27 Assignments and Participations.................................................................84
Section 11.28 Set-Off........................................................................................84
Section 11.29 Component Notes................................................................................84
Section 11.30 Approvals; Third Parties; Conditions...........................................................85
Section 11.31 Limitation on Liability of Lender's Officers, Employees, etc...................................85
SCHEDULES
Schedule I - Rent Roll
Schedule II - Required Repairs
Schedule III - Organizational Chart
Schedule IV - Form of Subordination, Non-Disturbance and Attornment Agreement
Schedule V - Intentionally Deleted
Schedule VI - Description/Diagram of Release Parcel
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LOAN AGREEMENT
THIS LOAN AGREEMENT, dated as of November 1, 2004 (as amended,
restated, replaced, supplemented or otherwise modified from time to time, this
"AGREEMENT"), between EUROHYPO AG, NEW YORK BRANCH, the New York branch of a
German banking corporation, having an address at 1114 Avenue of the Americas,
Xxxxxx-Xxxxx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000 (together with its permitted
successors and assigns, "LENDER"), and CEDAR-FRANKLIN VILLAGE LLC, a Delaware
limited liability company, having an address at c/o Cedar Shopping Centers
Partnership, L.P., 00 Xxxxx Xxxxxx Xxxxxx, Xxxxx 000, Xxxx Xxxxxxxxxx, XX 00000
(together with its permitted successors and assigns "BORROWER").
All other capitalized terms used herein shall have the
respective meanings set forth in Article I hereof.
W I T N E S S E T H:
WHEREAS, Borrower desires to obtain the Loan from Lender; and
WHEREAS, Lender is willing to make the Loan to Borrower,
subject to and in accordance with the conditions and terms of this Agreement and
the other Loan Documents.
NOW, THEREFORE, in consideration of the covenants set forth in
this Agreement, and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto hereby agree,
represent and warrant as follows:
I. DEFINITIONS; PRINCIPLES OF CONSTRUCTION
SECTION 1.1 DEFINITIONS.
For all purposes of this Agreement, except as otherwise
expressly provided:
"ACCESS LAWS" shall have the meaning set forth in Section
4.1.18.
"ADDITIONAL COLLATERAL" shall mean U.S. Obligations, that
provide payments on a portion of the Loan in the principal amount of $3,200,000
which are (i) paid on or prior to, but as close as possible to, the Business Day
immediately preceding all Monthly Payment Dates and other scheduled payment
dates, hereunder and (ii) in amounts equal to the scheduled payments of interest
up to and including the Permitted Repayment Date (including, the payment of
principal in the amount of $3,200,000.00 on the Permitted Repayment Date), and
all other payments, if any, required, under the Loan Documents for servicing
fees, and other similar charges.
"ACCOUNTS" shall have the meaning set forth in Section
3.1.35(a).
"ACQUIRED PROPERTY STATEMENTS" shall have the meaning set
forth in Section 9.1(c)(i).
"AFFILIATE" shall mean, as to any Person, any other Person
that, directly or indirectly, owns more than forty percent (40%) of, is in
control of, is controlled by or is under common ownership or control with such
Person or is a director or officer of such Person or of an Affiliate of such
Person. As used in this definition, the term "control" means the possession,
directly or indirectly, of the power to direct or cause the direction of the
management, policies or activities of a Person, whether through ownership of
voting securities, by contract or otherwise.
"AFFILIATED MANAGER" shall mean any managing agent in which
Borrower, Borrower Principal, any SPC Party (if any) or any Affiliate of such
Persons has, directly or indirectly, any legal, beneficial or economic interest.
"AGENT" shall mean PNC Bank, National Association and any
successor Eligible Institution thereto.
"ALLOCATED LOAN AMOUNT" shall mean with respect to the release
of the Release Parcel pursuant to Section 2.5.2, $4,785,000.
"ALTA" shall mean American Land Title Association, or any
successor thereto.
"ALTERATION THRESHOLD" shall mean an amount equal to five
percent (5%) of the original principal amount of the Loan.
"ANNUAL BUDGET" shall mean the operating and capital budget
for the Property setting forth Borrower's good faith estimate of Gross Income
from Operations, Operating Expenses, and Capital Expenditures for the applicable
Fiscal Year.
"APPROVED PROPERTY MANAGER" shall mean (i) Cedar Shopping
Centers Partnership L.P. , a Delaware limited partnership, for so long as that
entity is an Affiliate or sole member of Borrower and controlled by Cedar
Shopping Centers, Inc., a Maryland corporation or (ii) a reputable and
experienced management organization possessing experience in managing properties
similar in size, scope and value to the Property, provided that with respect to
an Approved Property Manager under clause (ii), (A) prior to a Securitization,
Borrower shall have obtained the prior written consent of Lender for such
entity, which consent shall not be unreasonably withheld and (B) after a
Securitization, Borrower shall have obtained prior written confirmation from the
Rating Agencies that management of the Property by such entity will not, in and
of itself, cause a downgrade, withdrawal or qualification of the then current
ratings of the Securities issued pursuant to the Securitization.
"ASSIGNMENT OF LEASES" shall mean that certain first priority
Assignment of Leases and Rents, dated as of the date hereof, from Borrower, as
assignor, to Lender, as assignee, as the same may be amended, restated,
replaced, supplemented or otherwise modified from time to time.
"ASSIGNMENT OF MANAGEMENT AGREEMENT" shall mean that certain
Assignment of Management Agreement and Subordination of Management Fees dated
the date hereof among Borrower, Manager and Lender, as the same may be amended,
restated, replaced, supplemented or otherwise modified from time to time.
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"AWARD" shall mean any compensation paid by any Governmental
Authority in connection with a Condemnation in respect of all or any part of the
Property.
"BANKRUPTCY CODE" shall mean Title 11 of the United States
Code entitled "Bankruptcy", as amended from time to time, and any successor
statute or statutes and all rules and regulations from time to time promulgated
thereunder, and any comparable foreign laws relating to bankruptcy, insolvency
or creditors' rights.
"BASIC CARRYING COSTS" shall mean the sum of the following
costs associated with the Property for the relevant Fiscal Year or payment
period: (i) Taxes and (ii) Insurance Premiums.
"BORROWER PRINCIPAL" shall mean Cedar Shopping Centers
Partnership, L.P.
"BUSINESS DAY" shall mean any day other than a Saturday, a
Sunday or a legal holiday on which national banks are not open for general
business in (i) the State of New York, (ii) the state where the corporate trust
office of the Trustee is located, or (iii) the state where the servicing offices
of the Servicer are located.
"CAPITAL EXPENDITURES" for any period shall mean amounts
expended for replacements and alterations to the Property and required to be
capitalized according to GAAP.
"CAPITAL EXPENDITURE FUNDS" shall have the meaning set forth
in Section 6.4.1.
"CAPITAL EXPENDITURES WORK" shall mean any labor performed or
materials installed in connection with any Capital Expenditure.
"CASH MANAGEMENT AGREEMENT" shall mean that certain Cash
Management Agreement of even date herewith among Lender, Borrower, Manager and
Agent.
"CASUALTY" shall mean the occurrence of any casualty, damage
or injury, by fire or otherwise, to the Property or any part thereof.
"CASUALTY CONSULTANT" shall have the meaning set forth in
Section 5.3.2(c).
"CASUALTY RETAINAGE" shall have the meaning set forth in
Section 5.3.2(d).
"CLOSING DATE" shall mean the date of funding the Loan.
"CODE" shall mean the Internal Revenue Code of 1986, as
amended, and as it may be further amended from time to time, any successor
statutes thereto, and applicable U.S. Department of Treasury regulations issued
pursuant thereto in temporary or final form.
"CONDEMNATION" shall mean a temporary or permanent
taking by any Governmental Authority as the result or in lieu or in anticipation
of the exercise of the right of condemnation or eminent domain, of all or any
part of the Property, or any interest therein or right accruing thereto,
including any right of access thereto or any change of grade affecting the
Property or any part thereof.
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"CONTROL" shall mean the power to direct the
management and policies of a Restricted Party, directly or indirectly, whether
through the ownership of voting securities or other beneficial interests, by
contract or otherwise.
"DEBT" shall mean the outstanding principal amount of
the Loan together with all interest accrued and unpaid thereon and all other
sums (including the Yield Maintenance Premium) due to Lender in respect of the
Loan under the Note, this Agreement, the Mortgage, the Environmental Indemnity
or any other Loan Document.
"DEBT SERVICE" shall mean, with respect to any particular
period of time, scheduled interest payments under the Note.
"DEBT SERVICE COVERAGE RATIO" shall mean a ratio for the
applicable period in which:
(i) the numerator is the Net Cash Flow for such
period as set forth in the financial statements required in
accordance with this Agreement; and
(ii) the denominator is the Debt Service due for such
period.
"DEFAULT" shall mean the occurrence of any
event hereunder or under any other Loan
Document which, but for the giving of notice or passage of time, or both, would
be an Event of Default.
"DEFAULT RATE" shall mean, with respect to the Loan,
a rate per annum equal to the lesser of (i) the maximum rate permitted by
applicable law, or (ii) five percent (5%) above the Interest Rate.
"DEFEASANCE COLLATERAL" shall mean the Total Defeasance
Collateral or the Partial Defeasance Collateral, as the case may be.
"DEFEASANCE COLLATERAL ACCOUNT" shall have the meaning set
forth in Section 2.5.3.
"DEFEASANCE DATE" shall mean the Total Defeasance Date or the
Partial Defeasance Date, as the case may be.
"DEFEASANCE EVENT" shall mean a Total Defeasance Event or a
Partial Defeasance Event, as the case may be.
"DEFEASED NOTE" shall have the meaning set forth in Section
2.5.2(a)(iv) hereof.
"DISCLOSURE DOCUMENT" shall have the meaning set forth in
Section 9.2(a).
"DISCLOSURE DOCUMENT DATE" shall have the meaning set forth in
Section 9.1(c)(iv).
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"ELIGIBLE ACCOUNT" shall mean a separate and identifiable
account from all other funds held by the holding institution that is either (i)
an account or accounts maintained with a federal or state-chartered depository
institution or trust company which complies with the definition of Eligible
Institution or (ii) a segregated trust account or accounts maintained with a
federal or state chartered depository institution or trust company acting in its
fiduciary capacity which, in the case of a state chartered depository
institution or trust company is subject to regulations substantially similar to
12 C.F.R. ss.9.10(b), having in either case a combined capital and surplus of at
least $50,000,000.00.00 and subject to supervision or examination by federal and
state authority. An Eligible Account will not be evidenced by a certificate of
deposit, passbook or other instrument.
"ELIGIBLE INSTITUTION" shall mean a depository institution or
trust company insured by the Federal Deposit Insurance Corporation the short
term unsecured debt obligations or commercial paper of which are rated at least
A-1 by S&P and having at least the equivalent rating from one of the two other
Rating Agencies in the case of accounts in which funds are held for thirty (30)
days or less or, in the case of Letters of Credit or accounts in which funds are
held for more than thirty (30) days, the long term unsecured debt obligations of
which are rated at least "AA" by Fitch and S&P and "Aa2" by Moody's.
"ENVIRONMENTAL INDEMNITY" shall mean that certain
Environmental Indemnity Agreement, dated as of the date hereof, executed by
Borrower and Guarantor in connection with the Loan for the benefit of Lender.
"EQUIPMENT" shall have the meaning set forth in the granting
clause of the Mortgage.
"ERISA" shall have the meaning set forth in Section 4.2.7.
"EVENT OF DEFAULT" shall have the meaning set forth in Section
10.1.
"EXCHANGE ACT" shall have the meaning set forth in Section
9.2(a).
"EXCHANGE ACT FILING" shall have the meaning set forth in
Section 9.1(c)(vii).
"EXECUTIVE ORDER" shall have the meaning set forth in the
definition of "Prohibited Person".
"EXXON REMEDIATION" shall mean those certain remediation
efforts at the Property made or to be made by Exxon Mobil in connection with a
petroleum release from an underground storage tank located on the Property,
which remediation efforts include that certain Phase III Remedial Action Plan
and that certain Phase VI Remedy Implementation Plan developed by Groundwater &
Environmental Services, Inc. in accordance with Environmental Law as enforced by
the New Jersey Department of Environmental Protection.
"FISCAL YEAR" shall mean each twelve month period
commencing on January 1 and ending on December 31 during each year of the term
of the Loan.
"FITCH" shall mean Fitch, Inc. and its successors.
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"GAAP" shall mean generally accepted accounting principles set
forth in the opinions and pronouncements of the Accounting Principles Board and
the American Institute of Certified Public Accountants and statements and
pronouncements of the Financial Accounting Standards Board (or agencies with
similar functions of comparable stature and authority within the accounting
profession), or in such other statements by such entity as may be in general use
by significant segments of the U.S. accounting profession.
"GOVERNMENTAL AUTHORITY" shall mean any court, board,
agency, commission, office or authority of any nature whatsoever or any
governmental xxxx (xxxxxxx, xxxxx, xxxxxx, xxxxxxxx, xxxxxxxxx, xxxx or
otherwise) whether now or hereafter in existence.
"GROSS INCOME FROM OPERATIONS" shall mean, for any
period, all income, computed in accordance with GAAP, derived from the ownership
and operation of the Property from whatever source during such period,
including, but not limited to, Rents, utility charges, escalations, forfeited
security deposits, interest on credit accounts, service fees or charges, license
fees, parking fees, rent concessions or credits, and other pass-through or
reimbursements paid by tenants under the Leases of any nature but excluding
Rents from month-to-month tenants or tenants that are debtors in any proceeding
under the Bankruptcy Code, sales, use and occupancy or other taxes on receipts
required to be accounted for by Borrower to any Governmental Authority, refunds
and uncollectible accounts, sales of furniture, fixtures and equipment, Net
Proceeds (other than business interruption or other loss of income insurance),
and any disbursements to Borrower from the Tax Funds, Insurance Funds, the
Capital Expenditure Funds, the Rollover Funds, or any other escrow fund
established by the Loan Documents.
"GUARANTIES" shall have the meaning set forth in Section 8.3
hereof.
"GUARANTOR" shall mean Cedar Shopping Centers Partnership,
L.P.
"GUARANTY" shall mean that certain Guaranty of even date
herewith from Guarantor for the benefit of Lender.
"IMPROVEMENTS" shall have the meaning set forth in the
granting clause of the Mortgage.
"INDEBTEDNESS" shall mean, for any Person, without
duplication: (i) all indebtedness of such Person for borrowed money, for amounts
drawn under a letter of credit, or for the deferred purchase price of property
for which such Person or its assets is liable, (ii) all unfunded amounts under a
loan agreement, letter of credit, or other credit facility for which such Person
would be liable if such amounts were advanced thereunder, (iii) all amounts
required to be paid by such Person as a guaranteed payment to partners or a
preferred or special dividend, including any mandatory redemption of shares or
interests, (iv) all indebtedness guaranteed by such Person, directly or
indirectly, (v) all obligations under leases that constitute capital leases for
which such Person is liable, and (vi) all obligations of such Person under
interest rate swaps, caps, floors, collars and other interest hedge agreements,
in each case whether such Person is liable contingently or otherwise, as
obligor, guarantor or otherwise, or in respect of which obligations such Person
otherwise assures a creditor against loss.
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"I&G FUNDS" shall mean the constituent entities (and their
wholly owned subsidiaries) from time to time of the fund marketed as the "X.X.
Xxxxxx U.S. Real Estate Income and Growth Fund," of which JPMorgan Investment
Management Inc. (or JPMorgan Chase Bank, or any of their affiliates) and/or
their successors and assigns is the investment advisor and, as of the date
hereof includes, without limitation, JPM I&G Domestic REIT, Inc., X.X. Xxxxxx
U.S. Real Estate Income and Growth Direct, LP, X.X. Xxxxxx U.S. Real Estate
Income and Growth Corp. (Cayman), X.X. Xxxxxx U.S. Real Estate Income and Growth
Finance Corp (Cayman), X.X. Xxxxxx U.S. Real Estate Income and Growth Investment
Corp (Cayman), X.X. Xxxxxx U.S. Real Estate Income and Growth GmBH & Co. KG, and
X.X. Xxxxxx U.S. Real Estate and Growth Domestic, LP.
"INDEMNIFIED LIABILITIES" shall have the meaning set forth in
Section 11.13(b).
"INDEPENDENT DIRECTOR" shall have the meaning set forth in
Section 3.1.24(p).
"INTEREST RATE" shall mean a rate per annum equal to four and
eighty-one hundredths percent (4.81%).
"INSOLVENCY OPINION" shall mean that certain bankruptcy
non-consolidation opinion letter, dated the date hereof, rendered by Lavenfeld
Xxxxxxxxxx, LLC in connection with the Loan.
"INSURANCE FUNDS" shall have the meaning set forth in Section
6.3.1.
"INSURANCE PREMIUMS" shall have the meaning set forth in
Section 5.1.1(b).
"LEASE" shall mean any lease, sublease or subsublease,
letting, license, concession or other agreement (whether written or oral and
whether now or hereafter in effect) pursuant to which any Person is granted a
possessory interest in, or right to use or occupy all or any portion of any
space in the Property, and every modification, amendment or other agreement
relating to such lease, sublease, subsublease, or other agreement entered into
in connection with such lease, sublease, subsublease, or other agreement and
every guarantee of the performance and observance of the covenants, conditions
and agreements to be performed and observed by the other party thereto.
"LEGAL REQUIREMENTS" shall mean all federal, state,
county, municipal and other governmental statutes, laws, rules, orders,
regulations, ordinances, judgments, decrees and injunctions of Governmental
Authorities affecting Borrower or the Property or any part thereof or the
construction, use, alteration or operation thereof, or any part thereof, whether
now or hereafter enacted and in force, including, without limitation, the
Americans with Disabilities Act of 1990, and all permits, licenses and
authorizations and regulations relating thereto, and all covenants, agreements,
restrictions and encumbrances contained in any instruments, either of record or
known to Borrower, at any time in force affecting the Property or any part
thereof, including, without limitation, any which may (i) require repairs,
modifications or alterations in or to the Property or any part thereof, or (ii)
in any way limit the use and enjoyment thereof.
"LENDER GROUP" shall have the meaning set forth in Section
9.2(b).
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"LENDER INDEMNITEES" shall have the meaning set forth in
Section 11.13(b).
"LIABILITIES" shall have the meaning set forth in Section
9.2(b).
"LIEN" shall mean any mortgage, deed of trust, lien,
pledge, hypothecation, assignment, security interest, or any other encumbrance
or charge, on or affecting the Property or any portion thereof or Borrower, or
any interest therein, including, without limitation, any conditional sale or
other title retention agreement, any financing lease having substantially the
same economic effect as any of the foregoing, the filing of any financing
statement, and mechanic's, materialmen's and other similar liens and
encumbrances.
"LOAN" shall mean the loan in the original principal
amount of Forty-Three Million Five Hundred Thousand and No/100 Dollars
($43,500,000.00) made by Lender to Borrower pursuant to this Agreement evidenced
by the Note and secured by the Mortgage, together with all sums due or to become
due thereunder.
"LOAN DOCUMENTS" shall mean, collectively, this
Agreement, the Note, the Mortgage, the Assignment of Leases, the Cash Management
Agreement, the Environmental Indemnity, the Guaranty, the Supplemental Guaranty,
the Assignment of Management Agreement as well as all other documents now or
hereafter executed and/or delivered in connection with the Loan.
"LOAN TO VALUE RATIO" shall mean the ratio, as of a
particular date, in which the numerator is equal to the outstanding principal
balance of the Debt and the denominator is equal to the appraised value of the
Property based on a FIRREA-conforming appraisal in form and substance
satisfactory to Lender, as determined by Lender in its sole and absolute
discretion.
"MAJOR LEASE" shall mean any Lease covering 10,000
square feet or more at the Property, provided that the calculations set forth in
this definition of Major Lease shall be made based on the aggregate square
footage leased, by any single Tenant and/or Affiliate of such Tenant, whether
pursuant to a single Lease or otherwise.
"MANAGEMENT AGREEMENT" shall mean that certain
management agreement entered into by and between Borrower and the Manager,
pursuant to which the Manager is to provide management and other services with
respect to the Property.
"MANAGER" shall mean Xxxxxxxx Properties, Inc., a
Massachusetts corporation, or any other manager approved in accordance with the
terms and conditions of the Loan Documents.
"MATERIAL ADVERSE EFFECT" shall mean any material
adverse effect upon (i) the business operations, economic performance, assets,
financial condition, equity, contingent liabilities, prospects, material
agreements or results of operations of Borrower, Guarantor or the Property, (ii)
the ability of Borrower or Guarantor to perform, in all material respects, its
obligations under each of the Loan Documents, (iii) the enforceability or
validity of any Loan Document, the perfection or priority of any Lien created
under any Loan Document or the remedies of the Lender under any Loan Document or
(iv) the value of, or cash flow from the Property or the operations thereof.
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"MATERIAL AGREEMENTS" shall mean each contract and
agreement relating to the ownership, management, development, use, operation,
leasing, maintenance, repair or improvement of the Property, other than the
Management Agreement and the Leases or other contract and/or agreement that is
material to the use and operation of the Property or to Borrower.
"MATURITY DATE" shall mean November 1, 2011 or such
other date on which the final payment of principal of the Note becomes due and
payable as therein or herein provided, whether at such stated maturity date, by
declaration of acceleration, or otherwise.
"MAXIMUM LEGAL RATE" shall mean the maximum
nonusurious interest rate, if any, that at any time or from time to time may be
contracted for, taken, reserved, charged or received on the indebtedness
evidenced by the Note and as provided for herein or the other Loan Documents,
under the laws of such state or states whose laws are held by any court of
competent jurisdiction to govern the interest rate provisions of the Loan.
"MINIMUM DISBURSEMENT AMOUNT" shall mean Twenty-Five Thousand
and No/100 Dollars ($25,000.00).
"MONTHLY DEBT SERVICE PAYMENT AMOUNT" shall mean an
amount equal to the interest on the outstanding principal balance of the Loan
that accrues at the Interest Rate during each calendar month during the term of
the Loan, calculated in the manner set forth herein.
"MONTHLY PAYMENT DATE" shall mean the first (1st) day
of every calendar month occurring during the term of the Loan, provided,
however, that Lender shall have the right at any time prior to Securitization of
the Loan to change the Monthly Payment Date to any other day (or such other day
of a calendar month selected by Lender, in its sole and absolute discretion, to
collect debt service payments under loans which it makes and securitizes) upon
notice to Borrower (in which event such change shall then be deemed effective)
and, if requested by Lender, Borrower shall promptly execute an amendment to
this Agreement to evidence such change, at no cost to Borrower (except that
Borrower shall pay its own legal fees).
"MOODY'S" shall mean Xxxxx'x Investors Service, Inc.
"MORTGAGE" shall mean that certain first priority
Mortgage and Security Agreement, dated the date hereof, executed and delivered
by Borrower as security for the Loan and encumbering the Property, as the same
may be amended, restated, replaced, supplemented or otherwise modified from time
to time.
"NET CASH FLOW" shall mean, for any period, the
amount obtained by subtracting Operating Expenses for such period from Gross
Income from Operations for such period.
"NET PROCEEDS" shall mean: (i) the net amount of all
insurance proceeds payable as a result of a Casualty to the Property, after
deduction of reasonable costs and expenses (including, but not limited to,
reasonable attorneys' fees), if any, in collecting such insurance proceeds, or
(ii) the net amount of the Award, after deduction of reasonable costs and
expenses (including, but not limited to, reasonable attorneys' fees), if any, in
collecting such Award.
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"NET PROCEEDS DEFICIENCY" shall have the meaning set forth in
Section 5.3.2(f).
"NOTE" shall have the meaning set forth in Section 2.1.3.
"NOTICE" shall have the meaning set forth in Section 11.6.
"OFFICER'S CERTIFICATE" shall mean a certificate delivered to
Lender by Borrower which is signed by an authorized senior officer of Borrower.
"OPERATING AGREEMENTS" shall mean any material covenants,
restrictions or agreements of record relating to the construction, operation or
use of the Property.
"OPERATING EXPENSES" shall mean, for any period, the
total of all expenditures, computed on a cash accounting basis, of whatever kind
during such period relating to the operation, maintenance and management of the
Property that are incurred on a regular monthly or other periodic basis,
including without limitation, utilities, ordinary repairs and maintenance (which
ordinary repairs and maintenance for the purposes of this definition shall be no
less than an assumed expense of $54,062.50 per month), insurance, license fees,
property taxes and assessments, advertising expenses, management fees, payroll
and related taxes, computer processing charges, tenant improvements, leasing
commissions and normalized capital expenditures (which tenant improvements,
leasing commissions and normalized capital expenditures for the purposes of this
definition shall be no less than an assumed expense of $413,579.00 per month),
operational equipment or other lease payments as approved by Lender, and other
similar costs, but excluding from such calculation depreciation, Debt Service
and interest costs.
"OTHER CHARGES" shall mean all ground rents,
maintenance charges, impositions other than Taxes, and any other charges,
including, without limitation, vault charges and license fees for the use of
vaults, chutes and similar areas adjoining the Property, now or hereafter levied
or assessed or imposed against the Property or any part thereof.
"PARTIAL DEFEASANCE COLLATERAL" shall mean U.S.
Obligations, which provide payments (i) on or prior to, but as close as possible
to, the Business Day immediately preceding all Monthly Payment Dates and other
scheduled payment dates, if any, under the Defeased Note after the Partial
Defeasance Date and up to and including the Permitted Prepayment Date, and (ii)
in amounts equal to or greater than the Scheduled Partial Defeasance Payments
relating to such Monthly Payment Dates and other scheduled payment dates.
"PARTIAL DEFEASANCE DATE" shall have the meaning set forth in
Section 2.5.2(a)(i).
"PARTIAL DEFEASANCE EVENT" shall have the meaning set forth in
Section 2.5.2(a).
"PATRIOT ACT" shall mean collectively all laws relating to
terrorism or money laundering, including Executive Order No. 13224 on Terrorist
Financing (effective September 24, 2001) and the Uniting and Strengthening
America by Providing Appropriate Tools Required to Intercept and Obstruct
Terrorism Act of 2001 (Public Law 107 56).
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"PERMITTED ENCUMBRANCES" shall mean, collectively,
(i) the Liens and security interests created by the Loan Documents, (ii) all
Liens, encumbrances and other matters expressly set forth on Schedule A or
Schedule B of the Title Insurance Policy, (iii) Liens, if any, for Taxes imposed
by any Governmental Authority not yet due or delinquent, (iv) such other title
and survey exceptions as Lender has approved or may approve in writing in
Lender's sole discretion, and (v) easements granted by Borrower from and after
the date hereof in the ordinary course of business and approved by Lender, which
approval shall not be unreasonably withheld.
"PERMITTED INVESTMENTS" shall have the meaning set forth in
the Cash Management Agreement.
"PERMITTED PREPAYMENT DATE" shall have the meaning set forth
in Section 2.4.1.
"PERMITTED TRANSFEREE" shall mean a corporation,
partnership or limited liability company (i) acceptable to Lender in its sole
discretion, (ii) that qualifies as a single purpose, bankruptcy remote entity
under criteria established by the Rating Agencies and (iii) whose counsel has
delivered to Lender a non-consolidation opinion reasonably acceptable to Lender
and the Rating Agencies.
"PERSON" shall mean any individual, corporation,
partnership, limited liability company, joint venture, estate, trust,
unincorporated association, any other entity, any federal, state, county or
municipal government or any bureau, department or agency thereof and any
fiduciary acting in such capacity on behalf of any of the foregoing.
"POLICY" shall have the meaning set forth in Section 5.1.1(b).
"PREPAYMENT DATE" shall mean the date on which the Loan is
prepaid in accordance with the terms hereof.
"PROHIBITED PERSON" shall mean any Person:
(i) listed in the Annex to, or is otherwise subject to the
provisions of, the Executive Order No. 13224 on Terrorist Financing,
effective September 24, 2001, and relating to Blocking Property and
Prohibiting Transactions With Persons Who Commit, Threaten to Commit,
or Support Terrorism (the "EXECUTIVE ORDER");
(ii) that is owned or controlled by, or acting for or on
behalf of, any Person or entity that is listed in the Annex to, or is
otherwise subject to the provisions of the Executive Order;
(iii) with whom Lender is prohibited from dealing or otherwise
engaging in any transaction by any terrorism or money laundering Law,
including the Executive Order;
(iv) who commits, threatens or conspires to commit or supports
"terrorism" as defined in the Executive Order;
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(v) that is named as a "specially designated national and
blocked person" on the most current list published by the U.S. Treasury
Department Office of Foreign Assets Control at its official website or
at any replacement website or other replacement official publication of
such list; or
(vi) who is an Affiliate of a Person listed above.
"PROHIBITED TRANSFER" shall have the meaning
specified in Section 8.1(a).
"PROPERTY" shall mean the parcel of real property,
the Improvements thereon and all personal property owned by Borrower and
encumbered by the Mortgage, together with all rights pertaining to such property
and Improvements, all as more particularly described in the granting clauses of
the Mortgage.
"QUALIFIED TRANSFEREE" shall mean any one of the following
Persons or wholly owned subsidiaries of such Person:
(i) a pension fund, pension trust or pension account that (a)
has total real estate assets of at least One Billion Dollars and (b) is
managed by a Person who controls at least One Billion Dollars of real
estate equity assets; or
(ii) a pension fund advisor who (a) immediately prior to such
transfer, controls at least One Billion Dollars of real estate equity
assets and (b) is acting on behalf of one or more pension funds that,
in the aggregate, satisfy the requirements of clause (i) of this
definition; or
(iii) an insurance company which is subject to supervision by
the insurance commissioner, or a similar official or agency, of a state
or territory of the United States (including the District of Columbia)
(a) with a net worth, as of a date no more than six (6) months prior to
the date of the transfer of at least Five Hundred Million Dollars and
(b) who, immediately prior to such transfer, controls real estate
equity assets of at least One Billion Dollars; or
(iv) a corporation organized under the banking laws of the
United States or any state or territory of the United States (including
the District of Columbia) (a) with a combined capital and surplus of at
least Five Hundred Million Dollars and (b) who, immediately prior to
such transfer, controls real estate equity assets of at least One
Billion Dollars; or
(v) any Person (a) with a long-term unsecured debt rating from
the Rating Agencies of at least investment grade or (b) who (i)
directly or indirectly owns or operates at least twelve (12) regional
shopping centers totaling at least six million square feet of gross
leasable area, (ii) has a net worth, as of a date no more than six (6)
months prior to the date of such transfer, of at least Five Hundred
Million Dollars and (iii) immediately prior to such transfer, controls
real estate equity assets of at least One Billion Dollars.
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"RATING AGENCIES" shall mean, prior to the final
Securitization of the Loan, each of S&P, Xxxxx'x and Fitch, or any other
nationally-recognized statistical rating agency which has been designated by
Lender and, after the final Securitization of the Loan, shall mean any of the
foregoing that have rated any of the Securities.
"RATING AGENCY CONFIRMATION" shall mean a written
affirmation from each of the Rating Agencies that the credit rating of the
Securities by such Rating Agency immediately prior to the occurrence of the
event with respect to which such Rating Agency Confirmation is sought will not
be qualified, downgraded or withdrawn as a result of the occurrence of such
event, which affirmation may be granted or withheld in such Rating Agency's sole
and absolute discretion.
"REGISTRATION STATEMENT" shall have the meaning set forth in
Section 9.2(b).
"RELEASE DATE" shall mean the earlier to occur of (i)
the fourth (4th) anniversary of the Closing Date and (ii) the date that is two
(2) years from the "startup day" (within the meaning of Section 860G(a)(9) of
the Code) of the REMIC Trust established in connection with the last
Securitization involving any portion of this Loan.
"RELEASE PARCEL" shall mean that certain portion of
the Property comprising approximately 50,000 square feet of office space more
particularly shown on Schedule VI attached hereto.
"REMIC TRUST" shall mean a "real estate mortgage
investment conduit" within the meaning of Section 860D of the Code that holds
the Note or any portion thereof.
"RENTS" shall mean all rents (including, without
limitation, percentage rents), rent equivalents, moneys payable as damages or in
lieu of rent or rent equivalents, royalties (including, without limitation, all
oil and gas or other mineral royalties and bonuses), income, receivables,
receipts, revenues, deposits (including, without limitation, security, utility
and other deposits), accounts, cash, issues, profits, charges for services
rendered, and other consideration of whatever form or nature received by or paid
to or for the account of or benefit of Borrower or its agents or employees from
any and all sources arising from or attributable to the Property, and proceeds,
if any, from business interruption or other loss of income insurance.
"REQUIRED REPAIR FUNDS" shall have the meaning set forth in
Section 6.1.1.
"REQUIRED REPAIRS" shall have the meaning set forth in Section
6.1.1.
"RESERVE FUNDS" shall mean, collectively, the Capital
Expenditure Funds, the Insurance Funds, the Tax Funds, the Required Repair Funds
and the Rollover Funds.
"RESTORATION" shall have the meaning set forth in Section
5.2.1.
"RESTORATION THRESHOLD" shall mean Eight Hundred Seventy
Thousand and No/00 Dollars ($870,000.00).
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"RESTRICTED PARTY" shall mean Borrower, Borrower Principal,
and any SPC Party.
"ROLLOVER FUNDS" shall have the meaning set forth in Section
6.5.1.
"S&P" shall mean Standard & Poor's Ratings Services, a
division of The XxXxxx-Xxxx Companies, Inc.
"SALE OR PLEDGE" shall mean a voluntary or involuntary sale,
conveyance, mortgage, grant, bargain, encumbrance, pledge, assignment, grant of
any options with respect to, or any other transfer or disposition of (directly
or indirectly, voluntarily or involuntarily, by operation of law or otherwise,
and whether or not for consideration or of record) of a legal or beneficial
interest, except with respect to Permitted Encumbrances.
"SCHEDULED DEFEASANCE PAYMENTS" shall mean Scheduled Partial
Defeasance Payments or Scheduled Total Defeasance Payments, as the case may be.
"SCHEDULED PARTIAL DEFEASANCE PAYMENTS" shall mean
scheduled payments of interest and principal under the Defeased Note for all
Monthly Payment Dates occurring after the Partial Defeasance Date and up to and
including the Permitted Prepayment Date (including, the outstanding principal
balance on the Defeased Note as of the Permitted Prepayment Date), and all
payments required after the Partial Defeasance Date, if any, under the Loan
Documents for servicing fees, and other similar charges.
"SCHEDULED TOTAL DEFEASANCE PAYMENTS" shall mean
scheduled payments of interest and principal under the Note in the amount of the
Monthly Debt Service Payment Amount for all Monthly Payment Dates occurring
after the Total Defeasance Date and up to and including the Permitted Prepayment
Date (including, the outstanding principal balance on the Note as of the
Permitted Prepayment Date), and all payments required after the Total Defeasance
Date, if any, under the Loan Documents for servicing fees and other similar
charges.
"SECONDARY MARKET TRANSACTION" shall have the meaning set
forth in Section 9.1(a).
"SECURITIES" shall have the meaning set forth in Section
9.1(a).
"SECURITIES ACT" shall have the meaning set forth in Section
9.2(a).
"SECURITIZATION" shall have the meaning set forth in Section
9.1(a).
"SECURITY AGREEMENT" shall mean a security agreement
in form and substance that would be satisfactory to a prudent lender pursuant to
which Borrower grants Lender a perfected, first priority security interest in
the Defeasance Collateral Account and the Defeasance Collateral.
"SERVICER" shall have the meaning set forth in Section
11.24(a).
"SERVICING AGREEMENT" shall have the meaning set forth in
Section 11.24(a).
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"SEVERED LOAN DOCUMENTS" shall have the meaning set forth in
Section 10.2(c).
"SPC PARTY" shall have the meaning set forth in Section
3.1.24(o).
"STANDARD STATEMENTS" shall have the meaning set forth in
Section 9.1(c)(i).
"STATE" shall mean the State or Commonwealth in which the
Property or any part thereof is located.
"STOP AND SHOP" shall mean Stop & Shop Supermarket Company,
Inc., as tenant under the Stop and Shop Lease.
"STOP AND SHOP LEASE" shall mean that certain lease dated July
1, 1986 between Stop and Shop, as tenant and Xxxxx X. Xxxxxxxx and Xxxxxxx
Xxxxxxxx as Trustees for Franklin Village Trust, as landlord (as modified and
amended, including without limitation the Stop and Shop Third Lease Amendment).
"STOP AND SHOP THIRD LEASE AMENDMENT" shall mean that certain
Third Amendment to the Stop and Shop Lease, dated April 2, 2004.
"SUBSTITUTE GUARANTOR" shall have the meaning set forth in
Section 8.3 hereof.
"SUCCESSOR BORROWER" shall have the meaning set forth in
Section 2.5.3.
"SUPPLEMENTAL GUARANTY" shall mean that certain Supplemental
Guaranty of even date herewith from Guarantor for the benefit of Lender.
"SURVEY" shall mean a current land survey for the
Property, certified to the title company and Lender and its successors and
assigns, in form and content reasonably satisfactory to Lender and prepared by a
professional and properly licensed land surveyor reasonably satisfactory to
Lender in accordance with the 1999 Minimum Standard Detail Requirements for
ALTA/ACSM Land Title Surveys (i) meeting the classification of an "Urban Survey"
and the following additional items from the list of "Optional Survey
Responsibilities and Specifications" (Table A) should be added to each survey:
2, 3, 4, 6, 8, 9, 10, 11 and 13, (ii) reflecting a metes and bounds description
of the real property comprising part of the Property in conformity with the
Title Insurance Policy, and (iii) together with the surveyor's seal affixed to
the Survey and a certification from the surveyor in form and substance
reasonably acceptable to Lender.
"TAX FUNDS" shall have the meaning set forth in Section 6.2.1.
"TAXES" shall mean all real estate and personal
property taxes, assessments, water rates or sewer rents, now or hereafter levied
or assessed or imposed against the Property or part thereof, together with all
interest and penalties thereon.
"TENANT" shall mean any Person obligated by contract
or otherwise to pay monies (including a percentage of gross income, revenue or
profits) under any Lease now or hereafter affecting all or any part of the
Property.
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"TERRORISM CAP" shall have the meaning set forth in Section
5.1.1(a)(x) hereof.
"TITLE INSURANCE POLICY" shall mean an ALTA mortgagee
Title Insurance policy in the form reasonably acceptable to Lender issued with
respect to the Property and insuring the lien of the Mortgage together with such
endorsements and affirmative coverages as Lender may reasonably require.
"TOTAL DEFEASANCE COLLATERAL" shall mean U.S.
Obligations, which provide payments (i) on or prior to, but as close as possible
to, the Business Day immediately preceding all Monthly Payment Dates and other
scheduled payment dates, if any, under the Note after the Total Defeasance Date
and up to and including the Permitted Prepayment Date, and (ii) in amounts equal
to or greater than the Scheduled Total Defeasance Payments relating to such
Monthly Payment Dates and other scheduled payment dates.
"TOTAL DEFEASANCE DATE" shall have the meaning set forth in
Section 2.5.1(a)(i).
"TOTAL DEFEASANCE EVENT" shall have the meaning set forth in
Section 2.5.1(a).
"TRANSFEREE" shall have the meaning set forth in Section
8.1(e)(ii).
"TRUSTEE" shall mean any trustee holding the Loan in a
Securitization.
"UCC" or "UNIFORM COMMERCIAL CODE" shall mean the Uniform
Commercial Code as in effect in the State.
"UNDEFEASED NOTE" shall have the meaning set forth in Section
2.5.2(a)(iv) hereof.
"UNDERWRITER GROUP" shall have the meaning set forth in
Section 9.2(b).
"UPDATED INFORMATION" shall have the meaning set forth in
Section 9.1(b)(i).
"U.S. OBLIGATIONS" shall mean direct full faith and credit
obligations of the United States of America that are not subject to prepayment,
call or early redemption.
"YIELD MAINTENANCE PREMIUM" shall mean the amount, if any,
which, when added to the remaining principal amount of the Note, will be
sufficient to purchase U.S. Obligations providing the required Scheduled
Defeasance Payments and any other costs and expenses that would be incurred in
defeasing the Loan pursuant to Section 2.5 hereof.
SECTION 1.2 PRINCIPLES OF CONSTRUCTION.
All references to sections and schedules are to sections and
schedules in or to this Agreement unless otherwise specified. Unless otherwise
specified, the words "hereof," "herein" and "hereunder" and words of similar
import when used in this Agreement shall refer to this Agreement as a whole and
not to any particular provision of this Agreement. Unless otherwise specified,
all meanings attributed to defined terms herein shall be equally applicable to
both the singular and plural forms of the terms so defined.
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II. THE LOAN
SECTION 2.1 THE LOAN.
2.1.1 AGREEMENT TO LEND AND BORROW. Subject to and upon the
terms and conditions set forth herein, Lender shall make the Loan to Borrower
and Borrower shall accept the Loan from Lender on the Closing Date.
2.1.2 SINGLE DISBURSEMENT TO BORROWER. Borrower shall receive
only one (1) borrowing hereunder in respect of the Loan and any amount borrowed
and repaid hereunder in respect of the Loan may not be reborrowed.
2.1.3 THE NOTE. The Loan shall be evidenced by that certain
Promissory Note of even date herewith, in the stated principal amount of
Forty-Three Million Five Hundred Thousand and No/100 Dollars ($43,500,000.00)
executed by Borrower and payable to the order of Lender in evidence of the Loan
(as the same may hereafter be amended, supplemented, restated, increased,
extended or consolidated from time to time, the "NOTE") and shall be repaid in
accordance with the terms of this Agreement and the Note.
2.1.4 USE OF PROCEEDS. Borrower shall use proceeds of the Loan
to (a) to acquire the Property, (b) deposit the Reserve Funds, (c) pay costs and
expenses incurred in connection with the closing of the Loan, as approved by
Lender, (d) fund any working capital requirements of the Property, as approved
by Lender and (e) distribute the balance of the proceeds, if any to Borrower.
SECTION 2.2 INTEREST RATE.
2.2.1 INTEREST RATE. Interest on the outstanding principal
balance of the Loan shall accrue from the Closing Date up to and including the
Maturity Date at the Interest Rate.
2.2.2 INTENTIONALLY OMITTED
2.2.3 DEFAULT RATE. In the event that, and for so long as, any
Event of Default shall have occurred and be continuing, the outstanding
principal balance of the Loan and, to the extent permitted by law, overdue
interest in respect of the Loan, shall accrue interest at the Default Rate,
calculated from the date such payment was due without regard to any grace or
cure periods contained herein.
2.2.4 INTEREST CALCULATION. Interest on the outstanding
principal balance of the Loan shall be calculated by multiplying (a) the actual
number of days elapsed in the period for which the calculation is being made by
(b) a daily rate based on a three hundred sixty (360) day year (that is, the
Interest Rate or the Default Rate, as then applicable, expressed as an annual
rate divided by 360) by (c) the outstanding principal balance.
2.2.5 USURY SAVINGS. This Agreement and the other Loan
Documents are subject to the express condition that at no time shall Borrower be
required to pay interest on the principal balance of the Loan at a rate which
could subject Lender to either civil or criminal liability as a result of being
in excess of the Maximum Legal Rate. If by the terms of this Agreement or the
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other Loan Documents, Borrower is at any time required or obligated to pay
interest on the principal balance due hereunder at a rate in excess of the
Maximum Legal Rate, the Interest Rate or the Default Rate, as the case may be,
shall be deemed to be immediately reduced to the Maximum Legal Rate and all
previous payments in excess of the Maximum Legal Rate shall be deemed to have
been payments in reduction of principal and not on account of the interest due
hereunder. All sums paid or agreed to be paid to Lender for the use,
forbearance, or detention of the sums due under the Loan shall, to the extent
permitted by applicable law, be amortized, prorated, allocated, and spread
throughout the full stated term of the Loan until payment in full so that the
rate or amount of interest on account of the Loan does not exceed the Maximum
Legal Rate from time to time in effect and applicable to the Loan for so long as
the Loan is outstanding.
SECTION 2.3 LOAN PAYMENTS.
2.3.1 PAYMENT BEFORE MATURITY DATE. Borrower shall make a
payment to Lender of interest only on the Closing Date for the period from the
Closing Date through the last day of the month in which the Closing Date occurs
(unless the Closing Date is the first (1st) day of a calendar month, in which
case no such separate payment of interest shall be due). Borrower shall make a
payment to Lender of interest only in the amount of the Monthly Debt Service
Payment Amount on the Monthly Payment Date occurring in December, 2004 and on
each Monthly Payment Date thereafter to and including the Maturity Date.
2.3.2 INTENTIONALLY OMITTED.
2.3.3 PAYMENT ON MATURITY DATE. Borrower shall pay to Lender
on the Maturity Date the outstanding principal balance of the Loan, all accrued
and unpaid interest and all other amounts due hereunder and under the Note, the
Mortgage and the other Loan Documents.
2.3.4 LATE PAYMENT CHARGE. If any principal, interest or any
other sum due under the Loan Documents, other than the payment of principal due
on the Maturity Date, is not paid by Borrower on or prior to the fifth (5th) day
following the date on which it is due, Borrower shall pay to Lender upon demand
an amount equal to the lesser of (a) five percent (5%) of such unpaid sum or (b)
the maximum amount permitted by applicable law in order to defray the expense
incurred by Lender in handling and processing such delinquent payment and to
compensate Lender for the loss of the use of such delinquent payment. Any such
amount shall be secured by the Mortgage and the other Loan Documents.
2.3.5 METHOD AND PLACE OF PAYMENT.
(a) Except as otherwise provided herein, all payments and
prepayments under this Agreement and the Note shall be made to Lender not later
than 1:00 P.M., New York City time, on the date when due and shall be made in
lawful money of the United States of America in immediately available funds at
Lender's office at 1114 Avenue of the Xxxxxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx
00000, or at such other place as Lender may from time to time designate in
writing, and any funds received by Lender after such time shall, for all
purposes hereof, be deemed to have been paid on the next succeeding Business
Day.
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(b) Whenever any payment to be made hereunder or under any
other Loan Document shall be stated to be due on a day which is not a Business
Day, the due date thereof shall be the immediately preceding Business Day, and
such early payment shall in such case not be included in the computation of
interest.
(c) All payments required to be made by Borrower hereunder or
under the Note or the other Loan Documents shall be made irrespective of, and
without deduction for, any setoff, claim or counterclaim and shall be made
irrespective of any defense thereto.
SECTION 2.4 PREPAYMENTS.
2.4.1 VOLUNTARY PREPAYMENTS. Except as otherwise provided
herein, Borrower shall not have the right to prepay the Loan in whole or in
part. On and after May 1, 2011 ("PERMITTED PREPAYMENT DATE"), Borrower may, at
its option and upon thirty (30) days prior notice to Lender, prepay the Debt in
whole, but not in part, on any date without payment of the Yield Maintenance
Premium or any other prepayment premium, but with payment of accrued and unpaid
interest and all other sums owing under the Note, this Agreement and the other
Loan Documents. Any prepayment received by Lender on a date other than a Monthly
Payment Date shall include interest which would have accrued thereon to the next
Monthly Payment Date.
2.4.2 MANDATORY PREPAYMENTS. On each date on which Lender
actually receives a distribution of Net Proceeds, and if Lender does not make
such Net Proceeds available to Borrower for a Restoration, Borrower shall, at
Lender's option, prepay the outstanding principal balance of the Note in an
amount equal to one hundred percent (100%) of such Net Proceeds together with
interest that would have accrued on such amounts through the next Monthly
Payment Date. No Yield Maintenance Premium or any other prepayment premium shall
be due in connection with any prepayment made pursuant to this Section 2.4.2.
Any partial prepayment shall be applied to the payment due at maturity.
2.4.3 PREPAYMENTS AFTER DEFAULT. If after an Event of Default,
but prior to the date when prepayment is permitted under Section 2.4.1, payment
of all or any part of the principal of the Loan is tendered by Borrower (which
tender Lender may reject to the extent permitted under applicable Legal
Requirements), a purchaser at foreclosure or any other Person, such tender shall
be deemed an attempt to circumvent the prohibition against prepayment set forth
in Section 2.4.1 and Borrower, such purchaser at foreclosure or other Person
shall pay a sum equal to the greater of (i) the Yield Maintenance Premium, and
(ii) one percent (1.0%) of the outstanding principal balance of the Loan, in
addition to the outstanding principal balance, all accrued and unpaid interest
and other amounts payable under the Loan Documents.
SECTION 2.5 DEFEASANCE.
2.5.1 TOTAL DEFEASANCE.
(a) Provided no Event of Default shall have occurred and
remain uncured, Borrower shall have the right at any time after the Release Date
to voluntarily defease the entire Loan and obtain a release of the lien of the
Mortgage by providing Lender with the Total Defeasance Collateral (hereinafter,
a "TOTAL DEFEASANCE EVENT"), subject to the satisfaction of the following
conditions precedent:
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(i) Borrower shall provide Lender not less than thirty (30)
days notice (or such shorter period of time if permitted by Lender in
its sole discretion) specifying a date (the "TOTAL DEFEASANCE DATE") on
which the Total Defeasance Event is to occur;
(ii) Borrower shall pay to Lender (A) all payments of interest
due on the Loan to and including the Total Defeasance Date (including,
without limitation, short-term interest, if any) and (B) all other
sums, then due under the Note, this Agreement, the Mortgage and the
other Loan Documents;
(iii) Borrower shall deposit the Total Defeasance Collateral
into the Defeasance Collateral Account and otherwise comply with the
provisions of Sections 2.5.3 and 2.5.4 hereof;
(iv) Borrower shall execute and deliver to Lender a Security
Agreement in respect of the Defeasance Collateral Account and the Total
Defeasance Collateral;
(v) Borrower shall deliver to Lender an opinion of counsel for
Borrower that is standard and commercially reasonable in commercial
lending transactions and subject only to customary qualifications,
assumptions and exceptions opining, among other things, that (A) Lender
has a legal and valid perfected first priority security interest in the
Defeasance Collateral Account and the Total Defeasance Collateral, (B)
if a Securitization has occurred, the REMIC Trust formed pursuant to
such Securitization will not fail to maintain its status as a "real
estate mortgage investment conduit" within the meaning of Section 860D
of the Code as a result of a Total Defeasance Event pursuant to this
Section 2.5, (C) that Borrower has legally and validly transferred and
assigned the Total Defeasance Collateral to the Successor Borrower and
(D) a non-consolidation opinion with respect to the Successor Borrower;
(vi) Borrower shall deliver to Lender a Rating Agency
Confirmation as to the Total Defeasance Event;
(vii) Borrower shall deliver an Officer's Certificate
certifying that the requirements set forth in this Section 2.5 have
been satisfied;
(viii) Borrower shall deliver a certificate of a "big four" or
other nationally recognized public accounting firm reasonably
acceptable to Lender certifying that the Total Defeasance Collateral
will generate monthly amounts equal to or greater than the Scheduled
Total Defeasance Payments;
(ix) Borrower shall deliver such other certificates, opinions,
documents and instruments as Lender may reasonably request; and
(x) Borrower shall pay all costs and expenses of Lender
actually incurred in connection with the Total Defeasance Event,
including Lender's reasonable attorneys' fees and expenses and Rating
Agency fees and expenses. Simultaneously with the notice described in
subparagraph (a)(i) above, Borrower shall deliver to Lender an amount
reasonably determined by Lender to be sufficient to pay such costs and
expenses, which amount may be applied by Lender toward payment of such
costs and expenses if a proposed Total Defeasance Event does not occur,
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provided that if such amount is insufficient to pay such costs and
expenses, Borrower shall remain obligated to pay any deficiency.
(b) If Borrower has elected to defease the Note and the
requirements of this Section 2.5.1 have been satisfied, the Property shall be
released from the lien of the Mortgage and the Total Defeasance Collateral
pledged pursuant to the Security Agreement shall be the sole collateral securing
the Note. In connection with the release of the Lien, Borrower shall submit to
Lender, not less than thirty (30) days prior to the Total Defeasance Date (or
such shorter time as is acceptable to Lender in its sole discretion), a release
of Lien (and related Loan Documents) for execution by Lender. Such release shall
be in a form appropriate in the jurisdiction in which the Property is located
and shall contain standard provisions protecting the rights of the releasing
lender. In addition, Borrower shall provide all other documentation Lender
reasonably requires to be delivered by Borrower in connection with such release,
together with an Officer's Certificate reasonably acceptable to Lender
certifying that such documentation (i) is in material compliance with all Legal
Requirements, and (ii) will effect such release in accordance with the terms of
this Agreement. Borrower shall pay all reasonable costs, taxes and expenses
associated with the release of the lien of the Mortgage, including Lender's
reasonable attorneys' fees. Except as set forth in this Section 2.5.1, no
repayment, prepayment or defeasance of all or any portion of the Note shall
cause, give rise to a right to require, or otherwise result in, the release of
the lien of the Mortgage on the Property. The foregoing release shall be
effective upon the Total Defeasance Date but Lender agrees to provide written
evidence of such release to Borrower promptly following Borrower's request
therefor. 2.5.2 PARTIAL DEFEASANCE. (a) Provided no Event of Default shall have
occurred and remain uncured beyond the expiration of any applicable cure period,
Borrower shall have the right at any time after the Release Date to obtain a
partial release of the Lien of the Mortgage encumbering the Release Parcel
(hereinafter, a "PARTIAL DEFEASANCE EVENT") upon satisfaction of the following
conditions:
(i) Borrower shall provide Lender thirty (30) days prior
written notice (or such shorter period of time if permitted by Lender
in its sole discretion) specifying a Monthly Payment Date (the "PARTIAL
DEFEASANCE DATE") on which Borrower shall have satisfied the conditions
in this Section 2.5.2 and shall effect the defeasance;
(ii) Borrower shall pay to Lender (A) all payments of interest
due and payable on the Loan up to and including the Partial Defeasance
Date and (B) all other sums, then due and payable under the Note, this
Agreement, the Mortgage and the other Loan Documents;
(iii) Borrower shall deposit the Partial Defeasance Collateral
into the Defeasance Collateral Account and otherwise comply with the
provisions of Sections 2.5.3 and 2.5.4 hereof;
(iv) Borrower shall prepare all necessary documents to modify
this Agreement and to amend and restate the Note and issue two
substitute notes, one note having a principal balance equal to 125% of
the Allocated Loan Amount (the "DEFEASED NOTE"), and the other note
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having a principal balance equal to the excess of (A) the outstanding
principal amount of the Loan, over (B) the amount of the Defeased Note
(the "UNDEFEASED NOTE"). The Defeased Note and the Undefeased Note
shall have identical payment terms as the Note except for the principal
balance. The Defeased Note and the Undefeased Note shall be cross
defaulted and cross collateralized unless the Rating Agencies shall
require otherwise or unless a Successor Borrower is established
pursuant to Section 2.5.4. A Defeased Note may not be the subject of
any further defeasance;
(v) Borrower shall execute and deliver to Lender a Security
Agreement in respect of the Defeasance Collateral Account and the
Partial Defeasance Collateral;
(vi) After giving effect to the release of the Lien of the
Mortgage encumbering the Release Parcel, the Debt Service Coverage
Ratio with respect to the remaining portion of the Property is not less
than the greater of (A) the Debt Service Coverage Ratio prior to the
release and (B) Debt Service Coverage Ratio of 1.90x.
(vii) Borrower shall have delivered to Lender and the Rating
Agencies shall have received from Borrower with respect to the matters
referred to in clause (vi), (A) statements of the Net Cash Flow and
Debt Service (both on a consolidated basis and separately for the
applicable portion of the Property to be released) for the applicable
measuring period and (B) based on the foregoing statements of Net Cash
Flow and Debt Service, calculations of the Debt Service Coverage Ratio
both with and without giving effect to the proposed release, and (C)
calculations of the ratios referred to in such clause (vi), accompanied
by an Officer's Certificate stating that such statements, calculations
and information are true, correct and complete in all material
respects;
(viii) Borrower shall deliver to Lender an opinion of counsel
for Borrower that would be reasonably satisfactory to a prudent lender
opining, among other things, that (A) Lender has a legal and valid
perfected first priority security interest in the Defeasance Collateral
Account and the Partial Defeasance Collateral, (B) if a Securitization
has occurred, the REMIC Trust formed pursuant to such Securitization
will not fail to maintain its status as a "real estate mortgage
investment conduit" within the meaning of Section 860D of the Code as a
result of the defeasance pursuant to this Section 2.5.2, (C) that
Borrower has legally and validly transferred and assigned the Total
Defeasance Collateral to the Successor Borrower (D) delivery of the
Partial Defeasance Collateral and the grant of a security interest
therein to Lender shall not constitute an avoidable preference under
Section 547 of the Bankruptcy Code or applicable state law and (E) a
non-consolidation opinion with respect to the Successor Borrower;
(ix) Borrower shall deliver to Lender a Rating Agency
Confirmation as to the Partial Defeasance Event;
(x) Borrower shall deliver a certificate of a "big four" or
other nationally recognized public accounting firm reasonably
acceptable to Lender certifying that the Partial Defeasance Collateral
will generate monthly amounts equal to or greater than the Scheduled
Defeasance Payments;
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(xi) Borrower shall deliver to Lender an Officer's Certificate
certifying that the requirements set forth in this Section 2.5.2(a)
have been satisfied;
(xii) Borrower shall deliver to Lender such other
certificates, documents or instruments as Lender may reasonably
request; and
(xiii) Borrower shall pay all costs and expenses of Lender
actually incurred in connection with the defeasance, including Lender's
reasonable attorneys' fees and expenses.
(b) If Borrower has elected to make a partial defeasance and
the requirements of Section 2.5.2(a) have been satisfied, the Release Parcel
shall be released from the Lien of the Mortgage, upon satisfaction of the
following additional conditions:
(i) on the date Borrower delivers to Lender notice of the
proposed release and on the date of the release, no Event of Default
has occurred which is continuing;
(ii) not less than ten (10) Business Days prior to the date of
the release, Borrower delivers to Lender a notice setting forth (i) the
date of the release, (ii) a metes and bounds description of the Release
Parcel and (iii) a Survey of the Release Parcel;
(iii) Borrower delivers to Lender evidence (together with an
Officer's Certificate certifying to such documentation) which would be
satisfactory to a prudent lender acting reasonably that (A) the Release
Parcel has been, or is about to be (without any further discretionary
or other approvals pending), legally subdivided from the remainder of
the Property; (B) after giving effect to such transfer, each of the
Release Parcel and the balance of the Property conforms to and is in
compliance in all material respects with applicable Legal Requirements
and constitute separate tax lots, and (C) the Release Parcel is not
necessary for the Property to comply with any zoning, building, land
use or parking or other Legal Requirements applicable to the Property
or for the then current use of the Property, including without
limitation for legal access, driveways, parking, utilities or drainage
or, to the extent that the Release Parcel is necessary for any such
purpose, a reciprocal easement agreement or other agreement has been
executed and recorded that would run to the benefit of Borrower, run
with the land and allow the owner of the Property to continue to use
the Release Parcel to the extent necessary for such purpose;
(iv) in the event that the release would reasonably be
expected to materially adversely effect Lender's rights under the Title
Insurance Policy as to any portion of the Property other than as to the
Release Parcel, Borrower shall deliver to Lender an endorsement to the
Title Insurance Policy insuring the Mortgage (A) extending the
effective date of the policy to the effective date of the release; (B)
confirming no change in the priority of the Mortgage on the balance of
the Property (exclusive of the Release Parcel) or in the amount of the
insurance or the coverage of the Property (exclusive of the Release
Parcel) under the policy; and (C) insuring the rights and benefits
under any new or amended reciprocal easement agreement or such other
agreement required pursuant to clause (iii)(C) of this Section that has
been executed and recorded, and the lien of the Mortgage is a first
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lien on Borrower's beneficial interest in such easement, subject to no
exceptions other than Permitted Encumbrances and those approved by
Lender in its reasonable discretion;
(v) Borrower has complied with any requirements applicable to
the release in the Leases, reciprocal easement agreements, operating
agreements, parking agreements or other similar agreements affecting
the Property and the release does not violate any of the provisions of
such documents in any respect that would result in a termination (or
give any other party thereto the right to terminate), extinguishment or
other loss of material rights of Borrower or in a material increase in
Borrower's obligations under such documents and, to the extent
necessary to comply with such documents, the transferee of the Release
Parcel has assumed Borrower's obligations, if any, relating to the
Release Parcel under such documents;
(vi) Borrower shall submit to Lender, not less than five (5)
Business Days prior to the Partial Defeasance Date (or such shorter
time as permitted by Lender in its sole discretion), a release of Lien
(and related Loan Documents) for execution by Lender. Such release
shall be in a form appropriate in the jurisdiction in which the
Property is located and that would be satisfactory to a prudent lender;
(vii) Borrower shall pay all costs, taxes and expenses
actually incurred in connection with the release of the Lien of the
Mortgage, including Lender's reasonable attorneys' fees and reasonable
out-of-pocket expenses;
(viii) Borrower delivers to Lender any other information,
approvals and documents which would be required by a prudent lender
acting reasonably relating to the release; and
(ix) Borrower shall cause, if applicable, title to the Release
Parcel so released from the Lien of the Mortgage to be transferred to
and held by a Person other than Borrower.
(c) Except as set forth in this Section 2.5, no repayment,
prepayment or defeasance of all or any portion of the Note shall cause, give
rise to a right to require, or otherwise result in, the release of any Lien of
any Mortgage on any of the Property.
2.5.3 DEFEASANCE COLLATERAL ACCOUNT. On or before the date on
which Borrower delivers the Defeasance Collateral, Borrower shall open at any
Eligible Institution the defeasance collateral account (the "DEFEASANCE
COLLATERAL ACCOUNT") which shall at all times be an Eligible Account. The
Defeasance Collateral Account shall contain only (a) Defeasance Collateral, and
(b) cash from interest and principal paid on the Defeasance Collateral. All cash
from interest and principal payments paid on the Defeasance Collateral shall be
paid over to Lender on each Monthly Payment Date and applied to accrued and
unpaid interest. Any cash from interest and principal paid on the Defeasance
Collateral not needed to pay the Scheduled Defeasance Payments shall be paid to
Borrower. Borrower shall cause the Eligible Institution at which the Defeasance
Collateral is deposited to enter an agreement with Borrower and Lender,
satisfactory to Lender in its sole discretion, pursuant to which such Eligible
Institution shall agree to hold and distribute the Defeasance Collateral in
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accordance with this Agreement. The Borrower or Successor Borrower, as
applicable, shall be the owner of the Defeasance Collateral Account and shall
report all income accrued on the Defeasance Collateral for federal, state and
local income tax purposes in its income tax return. Borrower or Successor
Borrower shall prepay all cost and expenses associated with opening and
maintaining the Defeasance Collateral Account. Lender shall not in any way be
liable by reason of any insufficiency in the Defeasance Collateral Account.
2.5.4 SUCCESSOR BORROWER. In connection with a Defeasance
Event under this Section 2.5, Borrower shall, if required by the Rating Agencies
or if Borrower elects to do so, establish or designate a successor entity (the
"SUCCESSOR BORROWER") which shall be a single purpose bankruptcy remote entity
and which shall be approved by the Rating Agencies. Any such Successor Borrower
may, at Borrower's option, be an Affiliate of Borrower unless the Rating
Agencies shall require otherwise. Borrower shall transfer and assign all
obligations, rights and duties under and to the Note or the Defeased Note, as
applicable, together with the Defeasance Collateral to such Successor Borrower.
Such Successor Borrower shall assume the obligations under the Note or the
Defeased Note, as applicable, and the Security Agreement and Borrower shall be
relieved of its obligations under such documents. Borrower shall pay a minimum
of One Thousand and No/100 Dollars ($1,000.00) to any such Successor Borrower as
consideration for assuming the obligations under the Note or the Defeased Note,
as applicable, and the Security Agreement. Borrower shall pay all costs and
expenses actually incurred by Lender, including Lender's reasonable attorney's
fees and expenses, actually incurred in connection therewith.
SECTION 2.6 FOREIGN LENDERS.
Any Lender that is not a United States "person" within the
meaning of Section 7701(a)(30) of the Code (a "NON-U.S. LENDER") shall deliver
to Borrower, upon making the Loan or accepting an assignment of the Loan or any
interest therein, two duly completed and signed copies of IRS Form W-8BEN, IRS
Form W-8ECI or IRS Form W-8IMY or any successor form thereto (relating to such
Non-U.S. Lender and entitling it to an exemption from, or reduction of,
withholding tax on all payments to be made to such Non-U.S. Lender by Borrower)
or such other evidence satisfactory to Borrower that such Non-U.S. Lender is
entitled to an exemption from, or reduction of, U.S. withholding tax. A Form
W-8BEN completed and delivered by (i) certain foreign trusts, or (ii) persons
claiming an exemption or reduced rate of withholding at source under an income
tax treaty will not be considered duly completed unless the Form W-8BEN contains
such Person's U.S. taxpayer identification number. Thereafter and from time to
time, such Non-U.S. Lender shall (a) upon reasonable requests from Borrower,
submit to Borrower such additional duly completed and signed copies of one of
such forms (or such successor forms as shall be adopted from time to time by the
relevant United States taxing authorities) as may then be available under then
current United States laws and regulations to avoid, or such evidence as is
satisfactory to Borrower of any available exemption from or reduction of, United
States withholding taxes in respect of all payments to be made to such Non-U.S.
Lender, (b) notify Borrower of any change in circumstances which would to
Lender's actual knowledge, modify or render invalid any claimed exemption or
reduction, and (c) upon reasonable requests from Borrower, take such steps as
shall not be materially disadvantageous to it, in the reasonable judgment of
such Non-U.S. Lender, and as may be reasonably necessary to avoid any
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requirements that Borrower make any deduction or withholding for taxes from
amounts payable to such Non-U.S. Lender. If such Non-U.S. Lender fails to
deliver the above forms or other documentation reasonably satisfactory to
Borrower evidencing complete exemption from U.S. federal withholding tax on all
payments by Borrower under the Loan, or if for any reason Borrower is required
by U.S. law to withhold U.S. income tax, then notwithstanding anything to the
contrary in the Loan Documents, Borrower may withhold from any interest payment
to such Non-U.S. Lender an amount equivalent to the applicable withholding tax
imposed by Sections 1441 and 1442 of the Code and deduct such withholding from
such payment.
III. REPRESENTATIONS AND WARRANTIES
SECTION 3.1 BORROWER REPRESENTATIONS.
Borrower represents and warrants that:
3.1.1 ORGANIZATION.
(a) Each of Borrower and each SPC Party is duly organized,
validly existing and in good standing with full power and authority to own the
Property and conduct its business, and is duly qualified in all jurisdictions in
which the ownership or lease of the Property or the conduct of its business
requires such qualification, except where the failure to be so qualified would
not have a Material Adverse Effect on its ability to perform its obligations
hereunder, and Borrower has taken all necessary action to authorize the
execution, delivery and performance of this Agreement and the other Loan
Documents by it, and has the power and authority to execute, deliver and perform
under this Agreement, the other Loan Documents and all the transactions
contemplated hereby.
(b) Borrower's exact legal name is correctly set forth in the
first paragraph of this Agreement. Borrower is an organization of the type
specified in the first paragraph of this Agreement. Borrower is incorporated or
organized under the laws of the state specified in the first paragraph of this
Agreement. Borrower's principal place of business and chief executive office,
and the place where Borrower keeps its books and records, including recorded
data of any kind or nature, regardless of the medium of recording, including
software, writings, plans, specifications and schematics, has been for the
preceding four (4) months (or, if less than four (4) months, the entire period
of the existence of Borrower) and will continue to be the address of Borrower
set forth in the first paragraph of this Agreement (unless Borrower notifies
Lender in writing at least thirty (30) days prior to the date of such change).
Borrower's organizational identification number, if any, assigned by the state
of its incorporation or organization is 3830201. Borrower's federal tax
identification number is 00-0000000.
3.1.2 PROCEEDINGS. This Agreement and the other Loan Documents
have been duly authorized, executed and delivered by Borrower and constitute a
legal, valid and binding obligation of Borrower, enforceable against Borrower in
accordance with their respective terms, except as such enforcement may be
limited by bankruptcy, insolvency, reorganization, moratorium or other similar
laws affecting the enforcement of creditors' rights generally, and by general
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principles of equity (regardless of whether such enforceability is considered in
a proceeding in equity or at law).
3.1.3 NO CONFLICTS. The execution and delivery of this
Agreement and the other Loan Documents by Borrower and the performance of its
obligations hereunder and thereunder will not conflict with any provision of any
law or regulation to which Borrower is subject, or conflict with, result in a
breach of, or constitute a default under, any of the terms, conditions or
provisions of any of Borrower's organizational documents or any agreement or
instrument to which Borrower is a party or by which it is bound, or any order or
decree applicable to Borrower, or result in the creation or imposition of any
lien on any of Borrower's assets or property (other than pursuant to the Loan
Documents).
3.1.4 LITIGATION. There is no action, suit, proceeding or
investigation pending or, to Borrower's knowledge, threatened against Borrower
in any court or by or before any other Governmental Authority that would have a
Material Adverse Effect.
3.1.5 AGREEMENTS. Borrower is not a party to any agreement or
instrument or subject to any restriction which would have a Material Adverse
Effect. Borrower is not in default in any material respect in the performance,
observance or fulfillment of any of the obligations, covenants or conditions
contained in any agreement or instrument to which it is a party or by which
Borrower or the Property is bound. Borrower has no material financial obligation
under any agreement or instrument to which Borrower is a party or by which
Borrower or the Property is otherwise bound, other than (a) obligations incurred
in the ordinary course of the operation of the Property and (b) obligations
under the Loan Documents.
3.1.6 CONSENTS. No consent, approval, authorization or order
of any court or Governmental Authority is required for the execution, delivery
and performance by Borrower of, or compliance by Borrower with, this Agreement
or the consummation of the transactions contemplated hereby, other than those
which have been obtained by Borrower.
3.1.7 TITLE. Borrower has good, marketable and insurable fee
simple title to the real property comprising part of the Property and good title
to the balance of the Property, free and clear of all Liens whatsoever except
the Permitted Encumbrances. The Mortgage, when properly recorded in the
appropriate records, will create (a) a valid, first priority, perfected lien on
the Property, subject only to Permitted Encumbrances and (b) perfected security
interests in and to, and perfected collateral assignments of, all personalty
(including the Leases), all in accordance with the terms thereof, in each case
subject only to any Permitted Encumbrances. There are no mechanics',
materialman's or other similar liens or claims which have been filed for work,
labor or materials affecting the Property which are or may be liens prior to, or
equal or coordinate with, the lien of the Mortgage. None of the Permitted
Encumbrances, individually or in the aggregate, materially interfere with the
benefits of the security intended to be provided by the Mortgage and this Loan
Agreement, materially and adversely affect the value of the Property, impair the
use or operations of the Property or impair Borrower's ability to pay its
obligations in a timely manner.
3.1.8 NO PLAN ASSETS. As of the date hereof and throughout the
term of the Loan (a) Borrower is not and will not be an "employee benefit plan,"
as defined in Section 3(3) of ERISA, subject to Title I of ERISA, (b) none of
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the assets of Borrower constitutes or will constitute "plan assets" of one or
more such plans within the meaning of 29 C.F.R. Section 2510.3-101, (c) Borrower
is not and will not be a "governmental plan" within the meaning of Section 3(32)
of ERISA, and (d) transactions by or with Borrower are not and will not be
subject to any state statute regulating investments of, or fiduciary obligations
with respect to, governmental plans.
3.1.9 COMPLIANCE. To the best of Borrower's knowledge,
Borrower and the Property and the use thereof comply in all material respects
with all applicable Legal Requirements, including, without limitation, building
and zoning ordinances and codes. To the best of Borrower's knowledge, Borrower
is not in default or violation of any order, writ, injunction, decree or demand
of any Governmental Authority, the violation of which would have a Material
Adverse Effect. There has not been and shall never be committed by Borrower or
any other person in occupancy of or involved with the operation or use of the
Property any act or omission affording the federal government or any state or
local government the right of forfeiture as against the Property or any part
thereof or any monies paid in performance of Borrower's obligations under any of
the Loan Documents. Borrower hereby covenants and agrees not to commit, permit
or suffer to exist any act or omission affording such right of forfeiture.
3.1.10 FINANCIAL INFORMATION. To the best of Borrower's
knowledge, all financial data, including, without limitation, the statements of
cash flow and income and operating expense, that have been delivered to Lender
in respect of the Property (i) are true, complete and correct in all material
respects, (ii) accurately represent the financial condition of the Property as
of the date of such reports, and (iii) have been prepared in accordance with
GAAP or such other accounting method that may be acceptable to Lender)
throughout the periods covered, except as disclosed therein. Borrower does not
have any contingent liabilities, liabilities for taxes, unusual forward or
long-term commitments or unrealized or anticipated losses from any unfavorable
commitments that are known to Borrower and reasonably likely to have a Material
Adverse Effect. Since the date of the most current financial statements
delivered by Borrower to Lender, there has been no material adverse change in
the financial condition, operations or business of Borrower or, to Borrower's
knowledge, the Property from that set forth in said financial statements.
3.1.11 CONDEMNATION. No Condemnation or other proceeding has
been commenced or, to Borrower's best knowledge, is threatened with respect to
all or any portion of the Property or for the relocation of roadways providing
access to the Property.
3.1.12 UTILITIES AND PUBLIC ACCESS. The Property has rights of
access to public ways and is served by water, sewer, sanitary sewer and storm
drain facilities adequate to service the Property for its intended uses.
3.1.13 SEPARATE LOTS. The Property is comprised of one (1) or
more parcels which constitute separate tax lots and do not constitute a portion
of any other tax lot not a part of the Property.
3.1.14 ASSESSMENTS. To Borrower's knowledge, there are no
pending or proposed special or other assessments for public improvements or
otherwise affecting the Property, nor are there any contemplated improvements to
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the Property that may result in such special or other assessments.
3.1.15 NO DEFENSES. The Loan Documents are not subject to any
right of rescission, set off, counterclaim or defense by Borrower, including the
defense of usury, nor would the operation of any of the terms of the Loan
Documents, or the exercise of any right thereunder, render the Loan Documents
unenforceable, and Borrower has not asserted any right of rescission, set off,
counterclaim or defense with respect thereto.
3.1.16 ASSIGNMENT OF LEASES. The Assignment of Leases creates
a valid assignment of, or a valid security interest in, certain rights under the
Leases, subject only to a license granted to Borrower to exercise certain rights
and to perform certain obligations of the lessor under the Leases, as more
particularly set forth therein. No Person other than Lender has any interest in
or assignment of the Leases or any portion of the Rents due and payable or to
become due and payable thereunder.
3.1.17 INSURANCE. Borrower has obtained and has delivered to
Lender original or certified copies of all of the Policies, with all premiums
prepaid thereunder, reflecting the insurance coverages, amounts and other
requirements set forth in this Agreement. No claims have been made under any of
the Policies, and no Person, including Borrower, has done, by act or omission,
anything which would impair the coverage of any of the Policies.
3.1.18 LICENSES. To the best of Borrower's knowledge, all
permits and approvals, including, without limitation, certificates of occupancy
required by any Governmental Authority for the use, occupancy and operation of
the Property in the manner in which the Property is currently being used,
occupied and operated have been obtained and are in full force and effect.
3.1.19 FLOOD ZONE. Except as disclosed on the Survey, none of
the Improvements on the Property is located in an area identified by the Federal
Emergency Management Agency as a special flood hazard area.
3.1.20 PHYSICAL CONDITION. Except as set forth in any property
condition or engineering report delivered to and reviewed by Lender in
connection with the Loan, and, to Borrower's knowledge, the Property, including,
without limitation, all buildings, improvements, parking facilities, sidewalks,
storm drainage systems, roofs, plumbing systems, HVAC systems, fire protection
systems, electrical systems, equipment, elevators, exterior sidings and doors,
landscaping, irrigation systems and all structural components, are in good
condition, order and repair in all material respects; except as set forth in any
property condition or engineering report delivered to and reviewed by lender in
connection with the Loan, and, to Borrower's knowledge, there exists no
structural or other material defects or damages in the Property, whether latent
or otherwise, and Borrower has not received notice from any insurance company or
bonding company of any defects or inadequacies in the Property, or any part
thereof, which would adversely affect the insurability of the same or cause the
imposition of extraordinary premiums or charges thereon or of any termination or
threatened termination of any policy of insurance or bond.
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3.1.21 BOUNDARIES. Except as set forth in the Survey and in
Lender's Title Insurance policy, all of the improvements which were included in
determining the appraised value of the Property lie wholly within the boundaries
and building restriction lines of the Property, and no improvements on adjoining
properties encroach upon the Property, and no easements or other encumbrances
affecting the Property encroach upon any of the improvements, so as to affect
the value or marketability of the Property except those which are insured
against by Title Insurance each of which, whether or not insured are shown on
the Survey.
3.1.22 LEASES. Borrower represents and warrants to Lender with
respect to the Leases that: (a) the rent roll attached hereto as Schedule I is
true, complete and correct and the Property is not subject to any Leases other
than the Leases described in Schedule I, (b) the Leases identified on Schedule I
are in full force and effect and there are no defaults thereunder by either
party except as otherwise set forth in an estoppel certificate executed by the
applicable Tenant delivered to Lender prior to the date hereof, (c) the copies
of the Leases delivered to Lender are true and complete in all material
respects, and there are no oral agreements with respect thereto except as
otherwise set forth in an estoppel certificate executed by the applicable Tenant
delivered to Lender prior to the date hereof, (d) no Rent (including security
deposits) has been paid more than one (1) month in advance of its due date
except as otherwise set forth in an estoppel certificate executed by the
applicable Tenant delivered to Lender prior to the date hereof, (e) all work to
be performed by Borrower under each Lease has been performed as required and has
been accepted by the applicable Tenant except as otherwise set forth in an
estoppel certificate executed by the applicable Tenant delivered to Lender prior
to the date hereof, (f) any payments, free rent, partial rent, rebate of rent or
other payments, credits, allowances or abatements required to be given by
Borrower to any Tenant has already been received by such Tenant except as
otherwise set forth in an estoppel certificate executed by the applicable Tenant
delivered to Lender prior to the date hereof, (g) all security deposits are
being held in accordance with Legal Requirements, (h) neither the landlord nor
any Tenant is in default under any of the Leases except as otherwise set forth
in an estoppel certificate executed by the applicable Tenant delivered to Lender
prior to the date hereof; (i) Borrower has no knowledge of any notice of
termination or default with respect to any Lease; (j) Borrower has not assigned
or pledged any of the Leases, the rents or any interests therein except to
Lender; (k) no Tenant or other party has an option or right of first refusal or
offer, to purchase all or any portion of the Property (other than the Stop and
Shop Lease, which right of first refusal has been waived by Stop and Shop
pursuant to that certain Notice of Waiver of Right of First Refusal dated
October 28, 2004); (l) no Tenant has the right to terminate its Lease prior to
expiration of the stated term of such Lease; and (m) all existing Leases are
subordinate to the Mortgage either pursuant to their terms or a recordable
subordination agreement delivered concurrently herewith, or delivered hereafter
as approved by Lender.
3.1.23 FILING AND RECORDING TAXES. All transfer taxes, deed
stamps, intangible taxes or other amounts in the nature of transfer taxes
required to be paid under applicable Legal Requirements in connection with the
transfer of the Property to Borrower have been paid or are being paid
simultaneously herewith. All mortgage, mortgage recording, stamp, intangible or
other similar tax required to be paid under applicable Legal Requirements in
connection with the execution, delivery, recordation, filing, registration,
perfection or enforcement of any of the Loan Documents, including, without
limitation, the Mortgage, have been paid or are being paid simultaneously
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herewith. All taxes and governmental assessments due and owing in respect of the
Property have been paid, or an escrow of funds in an amount sufficient to cover
such payments has been established hereunder.
3.1.24 SINGLE PURPOSE. Borrower hereby represents and warrants
to, and covenants with, Lender that as of the date hereof and until such time as
the Debt shall be paid in full, Borrower has not at any time, does not
presently, and shall not:
(a) own any asset or property other than (i) the Property, and
(ii) incidental personal property necessary for the ownership or operation of
the Property;
(b) engage in any business other than the ownership,
management and operation of the Property or fail to conduct and operate its
business as presently conducted and operated;
(c) enter into any contract or agreement with any Affiliate of
Borrower, any constituent party of Borrower or any Affiliate of any constituent
party, except upon terms and conditions that are intrinsically fair and
substantially similar to those that would be available on an arms-length basis
with third parties other than any such party;
(d) incur any Indebtedness other than (i) the Debt, (ii)
unsecured trade payables and operational debt not evidenced by a note and in an
aggregate amount not exceeding $1,000,000.00 at any one time, and (iii)
Indebtedness incurred in the financing of equipment and other personal property
used on the Property with annual payments not exceeding $500,000.00 in the
aggregate; provided that any Indebtedness incurred pursuant to subclauses (ii)
and (iii) shall be (x) paid within sixty (60) days of the date incurred and (y)
incurred in the ordinary course of business. No Indebtedness other than the Debt
may be secured (subordinate or pari passu) by the Property;
(e) make any loans or advances to any third party (including
any Affiliate or constituent party), or acquire obligations or securities of its
Affiliates;
(f) fail to remain solvent or fail to pay its debts and
liabilities (including, as applicable, shared personnel and overhead expenses)
from its assets as the same shall become due;
(g) fail to do all things necessary to observe organizational
formalities and preserve its existence, and Borrower will not, nor will Borrower
permit any constituent party to amend, modify or otherwise change the
partnership certificate, partnership agreement, articles of incorporation and
bylaws, operating agreement, trust or other organizational documents of Borrower
or such constituent party without the reasonable prior consent of Lender in any
manner that (i) violates the covenants set forth in this Section 3.1.24, or (ii)
amends, modifies or otherwise changes any provision thereof that by its terms
cannot be modified at any time when the Loan is outstanding or by its terms
cannot be modified without Lender's consent;
(h) fail to maintain all of its books, records, financial
statements and bank accounts separate from those of its Affiliates and any
constituent party. Borrower's assets will not be listed as assets on the
financial statement of any other Person, provided, however, that Borrower's
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assets may be included in a consolidated financial statement of its Affiliates
provided that (i) appropriate notation shall be made on such consolidated
financial statements to indicate the separateness of Borrower and such
Affiliates and to indicate that Borrower's assets and credit are not available
to satisfy the debts and other obligations of such Affiliates or any other
Person and (ii) such assets shall be listed on Borrower's own separate balance
sheet. Borrower will file its own tax returns (to the extent Borrower is
required to file any such tax returns) and will not file a consolidated federal
income tax return with any Person other than Cedar Shopping Centers Inc.
Borrower shall maintain its books, records, resolutions and agreements as
official records;
(i) fail to be, or fail to hold itself out to the public as, a
legal entity separate and distinct from any other entity (including any
Affiliate of Borrower or any constituent party of Borrower), fail to correct any
known misunderstanding regarding its status as a separate entity, fail to
conduct business in its own name, or fail to maintain and utilize separate
stationery, invoices and checks bearing its own name, and Borrower shall not
identify itself or any of its Affiliates as a division or part of the other;
(j) intentionally omitted;
(k) seek or effect the liquidation, dissolution, winding up,
liquidation, consolidation or merger, in whole or in part, of Borrower nor
permit any constituent party of Borrower to do any of the foregoing;
(l) commingle the funds and other assets of Borrower with
those of any Affiliate or constituent party or any other Person, and will hold
all of its assets in its own name;
(m) fail to maintain its assets in such a manner that it will
not be costly or difficult to segregate, ascertain or identify its individual
assets from those of any Affiliate or constituent party or any other Person;
(n) guarantee or become obligated for the debts of any other
Person or hold itself out to be responsible for or have its credit available to
satisfy the debts or obligations of any other Person;
(o) (i) If Borrower is a limited partnership or a limited
liability company (other than a single member limited liability company), fail
to cause each general partner or managing member (each, an "SPC PARTY") to be a
corporation whose sole asset is its interest in Borrower and each such SPC Party
will at all times comply, and will cause Borrower to comply, with each of the
representations, warranties, and covenants contained in this Section 3.1.24 as
if such representation, warranty or covenant was made directly by such SPC
Party. Upon the withdrawal or the disassociation of an SPC Party from Borrower,
Borrower shall immediately appoint a new SPC Party whose articles of
incorporation are substantially similar to those of such SPC Party and deliver a
new non-consolidation opinion to the Rating Agency or Rating Agencies, as
applicable, with respect to the new SPC Party and its equity owners;
(ii) If Borrower is a single member limited liability company,
fail to have at least two (2) springing members, one of which, upon the
dissolution of such sole member or the withdrawal or the disassociation
of the sole member from Borrower, shall immediately become the sole
member of Borrower, and the other of which shall become the sole member
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of Borrower if the first such springing member no longer is available
to serve as such sole member.
(p) fail to cause there to be one duly appointed member of the
board of directors who are provided by a nationally recognized company that
provides professional independent directors (each, an "INDEPENDENT DIRECTOR") of
Borrower reasonably satisfactory to Lender who shall not have been at the time
of such individual's appointment or at any time while serving as a director of
Borrower, and may not have been at any time during the preceding five years (i)
a stockholder, director (other than as an Independent Director), officer,
employee, partner, attorney or counsel of Borrower or any Affiliate of either of
them, (ii) a customer, supplier or other Person who derives any of its purchases
or revenues from its activities with Borrower or any Affiliate (other than
payment for services as an Independent Director), (iii) a Person or other entity
controlling or under common control with any such stockholder, partner,
customer, supplier or other Person, or (iv) a member of the immediate family of
any such stockholder, director, officer, employee, partner, customer, supplier
or other Person. (For purposes of this subclause (p), the term "Affiliate" means
any person controlling, under common control with, or controlled by the person
in question; and the term "control" means the possession, directly or
indirectly, of the power to direct or cause the direction of management,
policies or activities of a person or entity, whether through ownership of
voting securities, by contract or otherwise.) A natural person who satisfies the
foregoing definition other than subparagraph (ii) shall not be disqualified from
serving as an Independent Director if such individual is an independent director
provided by a nationally-recognized company that provides professional
independent directors and that also provides other corporate services in the
ordinary course of its business. A natural person who otherwise satisfies the
foregoing definition except for being the independent director of a "special
purpose entity" affiliated with the borrower that does not own a direct or
indirect equity interest in the borrower or any co-borrower shall not be
disqualified from serving as an Independent Director of the SPC Party if such
individual is at the time of initial appointment, or at any time while serving
as a Independent Director of the SPC Party, an Independent Director of a
"special purpose entity" affiliated with the Borrower or the SPC Party (other
than any entity that owns a direct or indirect equity interest in borrower or
any co-borrower) if such individual is an independent director provided by a
nationally-recognized company that provides professional independent directors.
For purposes of this paragraph, a "special purpose entity" is an entity, whose
organizational documents contain restrictions on its activities substantially
similar to those set forth in the SPC Party's organizational documents.
(q) cause or permit the board of directors of Borrower to take
any action which, under the terms of any certificate of incorporation, by laws
or any voting trust agreement with respect to any common stock or under any
organizational document of Borrower, requires a vote of the board of directors
of each SPC Party and Borrower unless at the time of such action there shall be
at least one (1) member who is an Independent Director.
(r) intentionally omitted.
(s) permit any Affiliate or constituent party independent
access to its bank accounts.
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(t) fail to pay the salaries of its own employees (if any)
from its own funds or fail to maintain a sufficient number of employees (if any)
in light of its contemplated business operations.
(u) fail to compensate each of its consultants and agents from
its funds for services provided to it and pay from its own assets all
obligations of any kind incurred.
3.1.25 TAX FILINGS. To the extent required, Borrower has filed
(or has obtained effective extensions for filing) all federal, state and local
tax returns required to be filed and have paid or made adequate provision for
the payment of all federal, state and local taxes, charges and assessments
payable by Borrower. Borrower believes that its tax returns (if any) properly
reflect the income and taxes of Borrower for the periods covered thereby,
subject only to reasonable adjustments required by the Internal Revenue Service
or other applicable tax authority upon audit.
3.1.26 SOLVENCY. Borrower (a) has not entered into the
transaction or any Loan Document with the actual intent to hinder, delay, or
defraud any creditor and (b) received reasonably equivalent value in exchange
for its obligations under the Loan Documents. Giving effect to the Loan, the
fair saleable value of Borrower's assets exceeds and will, immediately following
the making of the Loan, exceed Borrower's total liabilities, including, without
limitation, subordinated, unliquidated, disputed and contingent liabilities. The
fair saleable value of Borrower's assets is and will, immediately following the
making of the Loan, be greater than Borrower's probable liabilities, including
the maximum amount of its contingent liabilities on its debts as such debts
become absolute and matured. Borrower's assets do not and, immediately following
the making of the Loan will not, constitute unreasonably small capital to carry
out its business as conducted or as proposed to be conducted. Borrower does not
intend to, and does not believe that it will, incur Indebtedness and liabilities
(including contingent liabilities and other commitments) beyond its ability to
pay such Indebtedness and liabilities as they mature (taking into account the
timing and amounts of cash to be received by Borrower and the amounts to be
payable on or in respect of obligations of Borrower).
3.1.27 FEDERAL RESERVE REGULATIONS. No part of the proceeds of
the Loan will be used for the purpose of purchasing or acquiring any "margin
stock" within the meaning of Regulation U of the Board of Governors of the
Federal Reserve System or for any other purpose which would be inconsistent with
such Regulation U or any other Regulations of such Board of Governors, or for
any purposes prohibited by Legal Requirements or by the terms and conditions of
this Agreement or the other Loan Documents.
3.1.28 ORGANIZATIONAL CHART. The organizational chart attached
as Schedule III hereto, relating to Borrower and certain Affiliates and other
parties, is true, complete and correct on and as of the date hereof.
3.1.29 INVESTMENT COMPANY ACT. Borrower is not (a) an
"investment company" or a company "controlled" by an "investment company,"
within the meaning of the Investment Company Act of 1940, as amended; (b) a
"holding company" or a "subsidiary company" of a "holding company" or an
"affiliate" of either a "holding company" or a "subsidiary company" within the
meaning of the Public Utility Holding Company Act of 1935, as amended; or (c)
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subject to any other federal or state law or regulation which purports to
restrict or regulate its ability to borrow money.
3.1.30 ACCESS/UTILITIES. Except as disclosed in the Survey,
all public utilities necessary to the continued use and enjoyment of the
Property as presently used and enjoyed are located in the public right-of-way
abutting the Property. All roads necessary for the full utilization of the
Property for its current purpose have been completed and dedicated to public use
and accepted by all governmental authorities or are the subject of access
easements for the benefit of the Property.
3.1.31 NO BANKRUPTCY FILING. Borrower is not contemplating
either the filing of a petition by it under any state or federal bankruptcy or
insolvency laws or the liquidation of its assets or property, and Borrower does
not have any knowledge of any Person contemplating the filing of any such
petition against it.
3.1.32 FULL AND ACCURATE DISCLOSURE. To the best of Borrower's
knowledge, no information contained in this Agreement, the other Loan Documents,
or any written statement furnished by or on behalf of Borrower pursuant to the
terms of this Agreement contains any untrue statement of a material fact or
omits to state a material fact necessary to make the statements contained herein
or therein not misleading in light of the circumstances under which they were
made. There is no fact or circumstance presently known to Borrower which has not
been disclosed to Lender and which will have a Material Adverse Effect.
3.1.33 FOREIGN PERSON. Borrower is not a "foreign person"
within the meaning of Section 1445(f)(3) of the Code.
3.1.34 NO CHANGE IN FACTS OR CIRCUMSTANCES; DISCLOSURE. To the
best of Borrower's knowledge, there has been no material adverse change in any
condition, fact, circumstance or event that would make the financial statements,
rent rolls, reports, certificates or other documents submitted in connection
with the Loan inaccurate, incomplete or otherwise misleading in any material
respect or that otherwise materially and adversely affects the business
operations or the financial condition of Borrower or the Property.
3.1.35 PERFECTION OF ACCOUNTS. Borrower hereby represents and
warrants to Lender that:
(a) This Agreement, together with the other Loan Documents,
create a valid and continuing security interest (as defined in the Uniform
Commercial Code) in the Accounts (as defined in the Cash Management Agreement)
in favor of Lender, which security interest is prior to all other Liens, and is
enforceable as such against creditors of and purchasers from Borrower. Other
than in connection with the Loan Documents, Borrower has not sold or otherwise
conveyed the Accounts;
(b) The Accounts constitute "deposit accounts" or "securities
accounts" within the meaning of the Uniform Commercial Code, as set forth in the
Cash Management Agreement;
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(c) Pursuant to the Cash Management Agreement, Agent has
agreed to comply with all instructions originated by Lender, without further
consent by Borrower, directing disposition of the Accounts and all sums at any
time held, deposited or invested therein, together with any interest or other
earnings thereon, and all proceeds thereof (including proceeds of sales and
other dispositions), whether accounts, general intangibles, chattel paper,
deposit accounts, instruments, documents or securities; and
(d) The Accounts are not in the name of any Person other than
Borrower, as pledgor, or Lender, as pledgee. Borrower has not consented to
Agent's complying with instructions with respect to the Accounts from any Person
other than Lender.
3.1.36 INTENTIONALLY OMITTED.
3.1.37 INTENTIONALLY OMITTED.
3.1.38 PATRIOT ACT.
(a) None of Borrower, any of its constituents or Affiliates,
and to the best of Borrower's knowledge, any of its brokers or other agents
acting or benefiting in any capacity in connection with the Loan is a Prohibited
Person.
(b) None of Borrower, any of its constituents or Affiliates,
or, to Borrower's knowledge, any of its brokers or other agents acting in any
capacity in connection with the Loan, (i) has conducted or will conduct any
business or has engaged or will engage in any transaction or dealing with any
Prohibited Person, including making or receiving any contribution of funds,
goods or services to or for the benefit of any Prohibited Person, (ii) has dealt
or will deal in, or otherwise has engaged or will engage in any transaction
relating to, any property or interests in property blocked pursuant to the
Executive Order; or (iii) has engaged or will engage in or has conspired or will
conspire to engage in any transaction that evades or avoids, or has the purpose
of evading or avoiding, or attempts to violate, any of the prohibitions set
forth in the Executive Order or the Patriot Act.
(c) Borrower covenants and agrees to deliver to Lender any
certification or other evidence requested from time to time by Lender in its
reasonable discretion, confirming Borrower's compliance with this Section
3.1.38.
SECTION 3.2 SURVIVAL OF REPRESENTATIONS.
The representations and warranties set forth in Section 3.1
shall survive for so long as any amount remains payable to Lender under this
Agreement or any of the other Loan Documents.
IV. BORROWER COVENANTS
SECTION 4.1 BORROWER AFFIRMATIVE COVENANTS.
Borrower hereby covenants and agrees with Lender that:
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4.1.1 EXISTENCE; COMPLIANCE WITH LEGAL REQUIREMENTS. Borrower
shall do or cause to be done all things necessary to preserve, renew and keep in
full force and effect its existence, rights, licenses, permits and franchises
and comply with all Legal Requirements applicable to it and the Property.
4.1.2 TAXES AND OTHER CHARGES. Except as otherwise provided
herein, Borrower shall pay all Taxes and Other Charges now or hereafter levied
or assessed or imposed against the Property or any part thereof as the same
become due and payable; provided, however, Borrower's obligation to directly pay
Taxes shall be suspended for so long as Borrower complies with the terms and
provisions of Section 6.2 hereof. Borrower shall furnish to Lender receipts for
the payment of the Taxes and the Other Charges prior to the date the same shall
become delinquent; provided, however, that Borrower is not required to furnish
such receipts for payment of Taxes in the event that such Taxes have been paid
by Lender pursuant to Section 6.2 hereof. Borrower shall not permit or suffer
and shall promptly discharge any lien or charge against the Property. After
prior notice to Lender, Borrower, at its own expense, may contest by appropriate
legal proceeding, conducted in good faith and with due diligence, the amount or
validity of any Taxes or Other Charges, provided that (a) no Default or Event of
Default has occurred and remains uncured; (b) such proceeding shall be permitted
under and be conducted in accordance with all applicable statutes, laws and
ordinances; (c) neither the Property nor any part thereof or interest therein
will be in danger of being sold, forfeited, terminated, canceled or lost; (d)
Borrower shall promptly upon final determination thereof pay the amount of any
such Taxes or Other Charges, together with all costs, interest and penalties
which may be payable in connection therewith; (e) such proceeding shall suspend
the collection of Taxes or Other Charges from the Property; (f) Borrower shall
deposit with Lender cash, or other security as may be reasonably approved by
Lender, in an amount equal to one hundred twenty-five percent (125%) of the
contested amount, to insure the payment of any such Taxes or Other Charges,
together with all interest and penalties thereon; and (g) such contest by
Borrower is not in violation of Leases or Operating Agreements. Lender may pay
over any such cash or other security held by Lender to the claimant entitled
thereto at any time when, in the judgment of Lender, the entitlement of such
claimant is established.
4.1.3 LITIGATION. Borrower shall give prompt notice to Lender
of any litigation or governmental proceedings pending or, upon discovery by
Borrower, threatened against Borrower which if adversely determined would have a
Material Adverse Effect.
4.1.4 ACCESS TO PROPERTY. Borrower shall permit agents,
representatives and employees of Lender to inspect the Property or any part
thereof at reasonable hours upon reasonable advance notice, provided that such
inspection is conducted in a manner that minimizes interference with Tenants and
the operation of the Property.
4.1.5 INTENTIONALLY OMITTED.
4.1.6 FINANCIAL REPORTING.
(a) GAAP. Borrower shall keep and maintain or shall cause to
be kept and maintained, consistent with GAAP (or any other accounting basis that
is reasonably acceptable to Lender) proper and accurate books, records and
accounts reflecting all of the financial affairs of Borrower and all items of
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income and expense in connection with the operation on an individual basis of
the Property. All financial statements delivered to Lender consistent with this
Section 4.1.6 shall be prepared consistent with GAAP in the United States of
America as in effect on the date so indicated and consistently applied.
(b) Monthly Reports. Prior to a Securitization, within thirty
(30) days after the end of each calendar month, if requested by Lender Borrower,
shall furnish to Lender a current (as of the calendar month just ended) balance
sheet, a detailed operating statement (showing monthly activity and year to
date) stating gross income from operations, operating expenses, for the calendar
month just ended, a rent roll for the subject month and, as requested by Lender,
any other documentation supporting the information disclosed in the most recent
financial statements. In addition, such statement shall also be accompanied by
(i) a calculation reflecting the Debt Service Coverage Ratio as of the last day
of such month for such month and (ii) a certificate of an officer of Borrower or
the general partner of Borrower stating that the representations and warranties
of Borrower set forth in Section 3.1.24 are true and correct as of the date of
such certificate and that there are no trade payables outstanding for more than
sixty (60) days.
(c) Quarterly Reports. Within forty five (45) days after the
end of each calendar quarter, Borrower shall furnish to Lender a detailed
operating statement (showing quarterly activity and year to date) stating gross
income and operating expenses for the calendar quarter just ended and a balance
sheet (which also reports capital expenditures) for such quarter for Borrower.
Borrower's quarterly statements shall be accompanied by (i) a current rent roll
for the Property and (ii) a summary report for the most recently completed
calendar year of aggregate sales by tenants under Leases of the Property, to the
extent such information is provided by Tenants and/or required under the their
Leases, and (iii) a certificate executed by an officer of Borrower or the
general partner of Borrower stating that each such quarterly statement presents
fairly the financial condition and the results of operations of the Borrower and
the Property and has been prepared consistent with general accepted accounting
principles.
(d) Annual Reports. Within seventy five (75) days after the
end of each calendar year of Borrower's operation of the Property, Borrower will
furnish to Lender a complete copy of Borrower's annual financial statements
prepared by Borrower (or, if required by Lender, audited by Ernst & Young LLP or
other firm of independent certified public accountants acceptable to Lender),
consistent with GAAP for such calendar year which financial statements shall
contain a balance sheet, a detailed operating statement stating gross income,
operating expenses for each of Borrower and the Property. Borrower's annual
financial statements shall be accompanied by (i) a certificate executed by an
officer of Borrower or the managing member of Borrower stating that each such
annual financial statement presents fairly the financial condition and the
results of operations of Borrower and the Property and has been prepared
consistent with general accepted accounting principles, and (ii) if required by
Lender, an unqualified opinion of Ernst & Young LLP or other firm of independent
certified public accountants acceptable to Lender (notwithstanding the
foregoing, Borrower's financial statements may be consolidated with its
Affiliates, provided that Borrower also provides appropriate schedules to report
the amounts applicable to the Borrower and the Property).
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(e) Certification; Supporting Documentation. Each such
financial statement shall be in scope and detail reasonably satisfactory to
Lender and certified by an officer of Borrower.
(f) Additional Reports. Borrower shall deliver to Lender as
soon as reasonably available but in no event later than thirty (30) days after
such items become available to Borrower in final form:
(i) copies of any final engineering or environmental reports
prepared for Borrower with respect to the Property;
(ii) a copy of any notice received by Borrower from any
environmental authority having jurisdiction over the Property with
respect to a violation of any environmental law applicable to the
Property other than the Exxon Remediation;
(iii) a summary report containing each of the following with
respect to the Property for the most recently completed calendar year:
(A) aggregate sales by Tenants under Leases or other occupants of the
Property (only to the extent such information is provided by Tenants,
and/or required under Leases) and on a comparable store basis), (B)
rent per square foot payable by each tenant and (C) aggregate occupancy
of the Property by anchor space and in-line store space as of December
31; and
(iv) if requested by Lender, a summary report listing only
Tenants and square footage occupied by such Tenants.
(g) Access. Lender shall have the right from time to time upon
reasonable prior written notice to Borrower, at all times during normal business
hours to examine such books, records and accounts at the office of Borrower or
other Person maintaining such books, records and accounts and to make such
copies or extracts thereof as Lender shall reasonably desire. After the
occurrence of an Event of Default, Borrower shall pay any costs and expenses
incurred by Lender to examine Borrower's records with respect to the Property,
as Lender shall determine to be reasonably necessary or appropriate in the
protection of Lender's interest.
(h) Format of Delivery. Any reports, statements or other
information required to be delivered under this Agreement shall be delivered (i)
in paper form, (ii) on a diskette, and (iii) if requested by Lender and within
the capabilities of Borrower's data systems without change or modification
thereto, in electronic form reasonably acceptable to Lender.
(i) Annual Budget. Borrower shall submit the Annual Budget to
Lender not later than twenty (20) days prior to the commencement of each Fiscal
Year.
(j) Other Required Information. Borrower shall furnish to
Lender, within five (5) Business Days after request (or as soon thereafter as
may be reasonably possible), such further detailed information with respect to
the operation of the Property and the financial affairs of Borrower as may be
reasonably requested by Lender, provided that Borrower has such information
available.
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4.1.7 TITLE TO THE PROPERTY. Borrower will warrant and defend
the validity and priority of the Liens of the Mortgage and the Assignment of
Leases on the Property against the claims of all Persons whomsoever, subject
only to Permitted Encumbrances.
4.1.8 ESTOPPEL STATEMENT.
(a) After request by Lender (not more than one (1) time in any
calendar year provided no Event of Default exists), Borrower shall within ten
(10) Business Days furnish Lender with a statement, duly acknowledged and
certified, stating (i) the unpaid principal amount of the Note, (ii) the
Interest Rate of the Note, (iii) the date installments of interest were last
paid, (iv) any offsets or defenses to the payment of the Debt, if any, and (v)
that this Agreement and the other Loan Documents have not been modified or if
modified, giving particulars of such modification.
(b) Borrower shall endeavor to deliver to Lender, within
forty-five (45) days after request, an estoppel certificate from each Tenant
under any Lease (provided that Borrower shall only be required to use
commercially reasonable efforts to obtain an estoppel certificate from any
Tenant not required to provide an estoppel certificate under its Lease);
provided that such certificate shall be in the form required under such Lease;
provided further that Borrower shall not be required to deliver such
certificates more frequently than two (2) times in any calendar year.
4.1.9 LEASES.
(a) All Leases and other rental arrangements shall in all
material respects be approved by Lender and shall be on a standard Lease form
previously approved by Lender with no modifications (except as approved by
Lender). Such Lease form shall provide that (i) the Lease is subordinate to the
Mortgage, (ii) the tenant shall attorn to Lender, and (iii) that any
cancellation, surrender, or amendment of such Lease without the prior written
consent of Lender shall be voidable by Lender. Borrower shall hold, in trust,
all tenant security deposits in a segregated account, and, to the extent
required by applicable law, shall not commingle any such funds with any other
funds of Borrower. Within ten (10) days after Lender's request, Borrower shall
furnish to Lender a statement of all tenant security deposits, and copies of all
Leases not previously delivered to Lender, certified by Borrower as being true
and correct in all material respects. Notwithstanding anything contained in the
Loan Documents, Lender's approval shall not be required for future Leases, Lease
modifications, or Lease extensions if the following conditions are satisfied:
(A) no Event of Default has occurred and is continuing; (B) the Lease is on the
standard Lease form approved by Lender with no modifications except for
commercially reasonable modifications agreed to in the ordinary course of
Borrower's business, but in no event shall there be any material modifications
to the subordination, attornment, estoppel and landlord liability clauses of
such Lease without the prior written consent of Lender, which consent shall not
be unreasonably withheld, conditioned or delayed; (C) the Lease does not violate
any restrictive covenant affecting the Property or any other Lease for space in
the Property; (D) the Lease is not a Major Lease; (E) the Lease shall provide
for rental rates and landlord concessions comparable to existing local market
rates and shall be an arms length transaction and in no event be with an
Affiliate of Borrower; (F) the Lease shall be to a tenant which Borrower, in its
professional and commercially reasonably judgment, has determined is
creditworthy; and (G) the Lease is for a term of not more than ten (10) years
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(exclusive of renewal options, which together with the initial lease term shall
not exceed fifteen (15) years). Lender shall execute and deliver a Subordination
Non-Disturbance and Attornment Agreement in the form annexed hereto as Schedule
IV to Tenants under future Major Lease approved by Lender promptly upon request
with such commercially reasonable changes as may be requested by Tenants, from
time to time, and which are reasonably acceptable to Lender.
(b) Borrower (i) shall perform the obligations which Borrower
is required to perform under the Leases; (ii) shall enforce the obligations to
be performed by the tenants; (iii) shall promptly furnish to Lender any notice
of default or termination received by Borrower from any tenant, and any notice
of default or termination given by Borrower to any tenant; (iv) shall not
collect any rents for more than thirty (30) days in advance of the time when the
same shall become due, except for bona fide security deposits not in excess of
an amount equal to two months rent; (v) shall not enter into any ground Lease or
master Lease of any part of the Property; (vi) shall not further assign or
encumber any Lease; (vii) shall not, except with Lender's prior written consent,
cancel or accept surrender or termination of any Lease, except as expressly set
forth in Section 4.1.9(c) hereof, and (viii) any Lease termination or
cancellation fees shall be paid to Lender and held in the Rollover Fund. Any
action in violation of clauses (v), (vi), (vii), and (viii) of this Section
4.1.9(b) shall be void at the election of Lender.
(c) Notwithstanding anything to the contrary contained herein,
Borrower shall have the right to terminate any Lease which is not a Major Lease,
provided such termination is (i) commercially reasonable, (ii) made in
accordance with Borrower's reasonable business judgment, and (iii) the Lease so
terminated is replaced with a Lease which otherwise complies with the
requirements set forth in this Section 4.1.9.
(d) Notwithstanding anything to the contrary contained in this
Section 4.1.9, whenever Lender's approval or consent is required pursuant to the
provisions of this Section 4.1.9 for any matter that Lender has not previously
approved, Lender shall respond within ten (10) Business Days after Lender's
receipt of Borrower's written request for such approval or consent. If Lender
fails to respond to such request within five (5) Business Days, and Borrower
sends a second request containing a legend in bold letters stating that Lender's
failure to respond within five (5) Business Days shall be deemed consent or
approval, Lender shall be deemed to have approved or consented to the matter for
which Lender's consent or approval was sought if Lender fails to respond to such
second written request before the expiration of such second five (5) Business
Days period.
4.1.10 ALTERATIONS. Lender's prior approval shall be required
in connection with any alterations to any Improvements (except tenant
improvements under any Lease approved by Lender or under any Lease for which
approval was not required by Lender under this Agreement) (a) adversely
affecting structural components of the Property, utilities, HVAC or the exterior
of the building, (b) that may have a Material Adverse Effect or (c) the cost of
which (including any related alteration, improvement or replacement) is
reasonably anticipated to exceed the Alteration Threshold, which approval may be
granted or withheld in Lender's reasonable discretion. If the total unpaid
amounts incurred and to be incurred with respect to such alterations to the
Improvements shall at any time exceed the Alteration Threshold, Borrower shall
promptly deliver to Lender as security for the payment of such amounts and as
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additional security for Borrower's obligations under the Loan Documents any of
the following selected by Borrower: (i) cash, (ii) Letters of Credit, (iii) U.S.
Obligations, (iv) other securities reasonably acceptable to Lender, provided
that Lender shall have received a Rating Agency Confirmation as to the form and
issuer of same, or (v) a completion bond, provided that Lender shall have
received a Rating Agency Confirmation as to the form and issuer of same. Such
security shall be in an amount equal to the excess of the total unpaid amounts
incurred and to be incurred with respect to such alterations to the Improvements
(other than such amounts to be paid or reimbursed by Tenants under the Leases)
over the Alteration Threshold.
4.1.11 INTENTIONALLY OMITTED.
4.1.12 MATERIAL AGREEMENTS. Borrower shall (a) promptly
perform and/or observe all of the material covenants and agreements required to
be performed and observed by it under each Material Agreement and Operating
Agreement to which it is a party, and do all things necessary to preserve and to
keep unimpaired its rights thereunder, (b) promptly notify Lender in writing of
the giving of any notice of any default by any party under any Material
Agreement and Operating Agreement of which it is aware which has a Material
Adverse Effect on Borrower or the Property and (c) promptly enforce the
performance and observance of all of the material covenants and agreements
required to be performed and/or observed by the other party under each Material
Agreement and Operating Agreement to which it is a party in a commercially
reasonable manner.
4.1.13 PERFORMANCE BY BORROWER. Borrower shall in a timely
manner observe, perform and fulfill each and every covenant, term and provision
of each Loan Document executed and delivered by Borrower, and shall not enter
into or otherwise suffer or permit any amendment, waiver, supplement,
termination or other modification of any Loan Document executed and delivered by
Borrower without the prior consent of Lender.
4.1.14 INTENTIONALLY OMITTED.
4.1.15 BUSINESS AND OPERATIONS. Borrower will continue to
engage in the businesses currently conducted by it as and to the extent the same
are necessary for the ownership and leasing of the Property. Borrower will
qualify to do business and will remain in good standing under the laws of each
jurisdiction as and to the extent the same are required for the ownership and
leasing of the related Property. Borrower shall at all times cause the Property
to be maintained as a commercial retail shopping center.
4.1.16 LOAN FEES. Borrower shall pay all fees and costs
(including, without limitation, all origination and commitment fees) required of
Borrower pursuant to the terms of that certain term sheet between Cedar
Shoppings Center Partnership, L.P. and Lender dated September 30, 2004.
4.1.17 INTENTIONALLY OMITTED.
4.1.18 HANDICAPPED ACCESS.
(a) Borrower covenants and agrees that the Property shall at
all times comply to the extent applicable with the requirements of the Americans
with Disabilities Act of 1990, the Fair Housing Amendments Act of 1988, all
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state and local laws and ordinances related to handicapped access and all rules,
regulations, and orders issued pursuant thereto including, without limitation,
the Americans with Disabilities Act Accessibility Guidelines for Buildings and
Facilities (collectively, "ACCESS LAWS").
(b) Notwithstanding any provisions set forth herein or in any
other document regarding Lender's approval of alterations of the Property,
Borrower shall not alter the Property in any manner which would materially
increase Borrower's responsibilities for compliance with the applicable Access
Laws without the prior written approval of Lender. The foregoing shall apply to
tenant improvements constructed by Borrower or by any of its tenants. Lender may
condition any such approval upon receipt of a certificate of Access Law
compliance from an architect, engineer, or other person acceptable to Lender.
(c) Borrower covenants and agrees to give prompt notice to
Lender of the receipt by Borrower of any complaints related to violation of any
Access Laws and of the commencement of any proceedings or investigations which
relate to compliance with applicable Access Laws.
4.1.19 INTENTIONALLY OMITTED.
4.1.20 NOTICE OF CERTAIN EVENTS. Borrower shall promptly
notify Lender of (a) any Event of Default, together with a detailed statement of
the steps being taken to cure such Default or Event of Default; (b) any notice
of default received by Borrower under other obligations relating to the Property
or otherwise material to Borrower's business which, if determined adversely,
would have a Material Adverse effect on Borrower or the Property; and (c) any
threatened or pending legal, judicial or regulatory proceedings, including any
dispute between Borrower and any Governmental Authority, affecting Borrower or
the Property.
4.1.21 FURTHER ASSURANCES. Borrower shall, at Borrower's sole
cost and expense, promptly (a) cure any defects in the execution and delivery of
the Loan Documents, (b) execute and deliver, or cause to be executed and
delivered, all such other documents, agreements and instruments as Lender may
reasonably request to further evidence and more fully describe the collateral
for the Loan, to correct any omissions in the Loan Documents, to perfect,
protect or preserve any Liens created under any of the Loan Documents, or to
make any recordings, file any notices, or obtain any consents, as may be
necessary or appropriate in connection therewith provided such documents do not
increase Borrower's monetary obligations or decrease Borrower's rights hereunder
and (c) do all such further lawful and reasonable acts, conveyances and
assurances for the better and more effectively carrying out of the intents and
purposes of this Agreement and the other Loan Documents as Lender shall
reasonably require from time to time, provided such documents do not increase
Borrower's monetary obligations or decrease Borrower's rights hereunder. Upon
the occurrence and during the continuation of an Event of Default, Borrower
grants Lender an irrevocable power of attorney coupled with an interest for the
purpose of exercising and perfecting any and all rights and remedies available
to Lender under the Loan Documents, at law and in equity, including without
limitation such rights and remedies available to Lender pursuant to Sections
10.2, 10.3, and 10.4.
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4.1.22 TAXES ON SECURITY. Borrower shall pay all taxes,
charges, filing, registration and recording fees, excises and levies payable
with respect to the Note or the Liens created or secured by the Loan Documents,
other than income, franchise and doing business taxes imposed on Lender. If
there shall be enacted any law (a) deducting the Loan from the value of the
Property for the purpose of taxation, (b) affecting any Lien on the Property, or
(c) changing existing laws of taxation of mortgages, deeds of trust, security
deeds, or debts secured by real property, or changing the manner of collecting
any such taxes, Borrower shall promptly pay to Lender, on demand, all taxes,
costs and charges, other than income, franchise or doing business taxes, for
which Lender is or may be liable as a result thereof; however, if such payment
would be prohibited by law or would render the Loan usurious, then instead of
collecting such payment, Lender may declare all amounts owing under the Loan
Documents to be immediately due and payable without any prepayment penalty or
fee.
4.1.23 STOP AND SHOP ESTOPPEL. On or before May 5, 2006,
Borrower shall deliver evidence that Stop and Shop has commenced paying the
unabated annual fixed rent set forth in the Stop and Shop Third Lease Amendment.
If Borrower fails to comply with the provisions of this Section 4.1.23, then
Borrower shall deliver the Additional Collateral to Lender to be held by Lender
as additional security for the Loan to be deposited in an Account and maintained
by Lender pursuant to the Cash Management Agreement. At the request of Lender,
Borrower shall agree to reasonable amendments to the Cash Management Agreement
to reflect that the deposit of the Additional Collateral and provide any and all
other documentation reasonably required to perfect Lender's security interest in
the Additional Collateral. Any and all income earned on the Additional
Collateral shall inure to the benefit of Borrower.
SECTION 4.2 BORROWER NEGATIVE COVENANTS.
Borrower covenants and agrees with Lender that:
4.2.1 LIENS. Subject to Borrower's right to contest in
accordance with the express terms set forth in this Agreement, Borrower shall
not create, incur, assume or suffer to exist any Lien on any portion of the
Property except for Permitted Encumbrances.
4.2.2 DISSOLUTION. Except as expressly set forth in this
Agreement, Borrower shall not (a) engage in any dissolution, liquidation or
consolidation or merger with or into any other business entity, (b) transfer,
lease or sell, in one transaction or any combination of transactions, all or
substantially all of the property or assets of Borrower except to the extent
expressly permitted by the Loan Documents, or (c) cause, permit or suffer any
SPC Party to (i) dissolve, wind up or liquidate or take any action, or omit to
take an action, as a result of which such SPC Party would be dissolved, wound up
or liquidated in whole or in part, or (ii) amend, modify, waive or terminate the
certificate of incorporation or bylaws of such SPC Party, in each case without
obtaining the prior consent of Lender.
4.2.3 DEBT CANCELLATION. Borrower shall not cancel or
otherwise forgive or release any claim or debt (other than termination of Leases
in accordance herewith) owed to Borrower by any Person, except for adequate
consideration and in the ordinary course of Borrower's business.
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4.2.4 ZONING. Borrower shall not initiate or consent to any
zoning reclassification of any portion of the Property or seek any variance
under any existing zoning ordinance or use or permit the use of any portion of
the Property in any manner that could result in such use becoming a non
conforming use under any zoning ordinance or any other applicable land use law,
rule or regulation, without the prior written consent of Lender, which shall not
be unreasonably withheld, conditioned or delayed.
4.2.5 NO JOINT ASSESSMENT. Borrower shall not suffer, permit
or initiate the joint assessment of the Property (a) with any other real
property constituting a tax lot separate from the Property, and (b) with any
portion of the Property which may be deemed to constitute personal property, or
any other procedure whereby the lien of any taxes which may be levied against
such personal property shall be assessed or levied or charged to the Property.
4.2.6 PRINCIPAL PLACE OF BUSINESS. Borrower shall not change
its principal place of business from the address set forth on the first page of
this Agreement without first giving Lender thirty (30) days prior notice.
4.2.7 ERISA.
(a) Borrower shall not engage in any transaction which would
cause any obligation, or action taken or to be taken, hereunder (or the exercise
by Lender of any of its rights under the Note, this Agreement or the other Loan
Documents) to be a non-exempt (under a statutory or administrative class
exemption) prohibited transaction under the Employee Retirement Income Security
Act of 1974, as amended ("ERISA") or Section 4975 of the Code.
(b) Borrower shall deliver to Lender such certifications or
other evidence from time to time throughout the term of the Loan, as requested
by Lender in its sole discretion, that (i) Borrower is not an "employee benefit
plan" as defined in Section 3(3) of ERISA, which is subject to Title I of ERISA,
or a "plan" subject to Section 4975 of the Code, or a "governmental plan" within
the meaning of Section 3(32) of ERISA; (ii) Borrower is not subject to any state
statute regulating investments of, or fiduciary obligations with respect to,
governmental plans; and (iii) one or more of the following circumstances is
true:
(A) Equity interests in Borrower are publicly offered
securities, within the meaning of 29 C.F.R. ss.2510.3-101(b)(2);
(B) Less than twenty-five percent (25%) of each outstanding
class of equity interests in Borrower is held by "benefit plan investors" within
the meaning of 29 C.F.R. ss.2510.3-101(f)(2); or
(C) Borrower qualifies as an "operating company" or a "real
estate operating company" within the meaning of 29 C.F.R. ss.2510.3-101(c) or
(e).
4.2.8 MATERIAL AGREEMENTS. Borrower shall not, without
Lender's reasonable consent: (a) enter into, surrender or terminate any Material
Agreement or Operating Agreement to which it is a party (unless the other party
thereto is in material default and the termination of such agreement would be
commercially reasonable), (b) increase or consent to the increase of the amount
of any charges under any Material Agreement or Operating Agreement to which it
is a party, except as provided therein or on an arms-length basis and
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commercially reasonable terms; or (c) otherwise modify, change, supplement,
alter or amend, or waive or release any of its rights and remedies under any
Material Agreement or Operating Agreement to which it is a party in any material
respect, except on an arms'-length basis and commercially reasonable terms.
4.2.9 INTENTIONALLY DELETED.
4.2.10 INTENTIONALLY OMITTED.
V. INSURANCE, CASUALTY AND CONDEMNATION
SECTION 5.1 INSURANCE.
5.1.1 INSURANCE POLICIES.
(a) Borrower shall obtain and maintain, or cause to be
maintained, insurance for Borrower and the Property providing at least the
following coverages:
(i) comprehensive all risk insurance on the Improvements and
the personal property at the Property (A) in an amount equal to one
hundred percent (100%) of the "Full Replacement Cost," which for
purposes of this Agreement shall mean actual replacement value
(exclusive of costs of excavations, foundations, underground utilities
and footings) with a waiver of depreciation, but the amount shall in no
event be less than the outstanding principal balance of the Loan; (B)
containing an agreed amount endorsement with respect to the
Improvements and personal property at the Property waiving all
co-insurance provisions; (C) providing for no deductible in excess of
Twenty Five Thousand and No/100 Dollars ($25,000.00) for all such
insurance coverage; and (D) containing an "Ordinance or Law Coverage"
or "Enforcement" endorsement if any of the Improvements or the use of
the Property shall at any time constitute legal non-conforming
structures or uses. In addition, Borrower shall obtain: (y) if any
portion of the Improvements is currently or at any time in the future
located in a federally designated "special flood hazard area," flood
hazard insurance in an amount equal to the lesser of (1) the
outstanding principal balance of the Note or (2) the maximum amount of
such insurance available under the National Flood Insurance Act of
1968, the Flood Disaster Protection Act of 1973 or the National Flood
Insurance Reform Act of 1994, as each may be amended or such greater
amount as Lender shall require; and (z) earthquake insurance in amounts
and in form and substance satisfactory to Lender in the event the
Property is located in an area with a high degree of seismic activity,
provided that the insurance pursuant to clauses (y) and (z) hereof
shall be on terms consistent with the comprehensive all risk insurance
policy required under this subsection (i).
(ii) commercial general liability insurance against claims for
personal injury, bodily injury, death or property damage occurring
upon, in or about the Property, such insurance (A) to be on the
so-called "occurrence" form with an occurrence limit of not less than
One Million and No/100 Dollars ($1,000,000.00) and an aggregate limit
of not less than Two Million and No/100 Dollars ($2,000,000.00); (B) to
continue at not less than the aforesaid limit until required to be
changed by Lender by reason of changed economic conditions making such
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protection inadequate; and (C) to cover at least the following hazards:
(1) premises and operations; (2) products and completed operations on
an "if any" basis; (3) independent contractors; (4) blanket contractual
liability for all legal contracts; and (5) contractual liability
covering the indemnities contained in Article 9 of the Mortgage to the
extent the same is available;
(iii) business income insurance (A) with loss payable to
Lender; (B) covering all risks required to be covered by the insurance
provided for in subsection (i) above for a period commencing at the
time of loss for such length of time as it takes to repair or replace
with the exercise of due diligence and dispatch; (C) containing an
extended period of indemnity endorsement which provides that after the
physical loss to the Improvements and Personal Property has been
repaired, the continued loss of income will be insured until such
income either returns to the same level it was at prior to the loss, or
the expiration of twelve (12) months from the date that the Property is
repaired or replaced and operations are resumed, whichever first
occurs, and notwithstanding that the policy may expire prior to the end
of such period; and (D) in an amount equal to one hundred percent
(100%) of the projected gross income from the Property for a period
from the date of loss to a date (assuming total destruction) which is
six (6) months from the date that the Property is repaired or replaced
and operations are resumed. The amount of such business income
insurance shall be determined prior to the date hereof and at least
once each year thereafter based on Borrower's reasonable estimate of
the gross income from the Property for the succeeding twelve (12) month
period. Subject to Section 5.3.2 hereof, all proceeds payable to Lender
pursuant to this subsection shall be held by Lender and shall be
applied to the obligations secured by the Loan Documents from time to
time due and payable hereunder and under the Note; provided, however,
that nothing herein contained shall be deemed to relieve Borrower of
its obligations to pay the obligations secured by the Loan Documents on
the respective dates of payment provided for in the Note and the other
Loan Documents except to the extent such amounts are actually paid out
of the proceeds of such business income insurance;
(iv) at all times during which structural construction,
repairs or alterations are being made with respect to the Improvements,
and only if the Property coverage form does not otherwise apply, (A)
owner's contingent or protective liability insurance covering claims
not covered by or under the terms or provisions of the above mentioned
commercial general liability insurance policy; and (B) the insurance
provided for in subsection (i) above written in a so-called builder's
risk completed value form (1) on a non-reporting basis, (2) against all
risks insured against pursuant to subsection (i) above, (3) including
permission to occupy the Property, and (4) with an agreed amount
endorsement waiving co-insurance provisions;
(v) workers' compensation, subject to the statutory limits of
the state in which the Property is located, and employer's liability
insurance with a limit of at least One Million and No/100 Dollars
($1,000,000.00) per accident and per disease per employee, and One
Million and No/100 Dollars ($1,000,000.00) for disease aggregate in
respect of any work or operations on or about the Property, or in
connection with the Property or its operation (if applicable);
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(vi) comprehensive boiler and machinery insurance, if
applicable, in amounts as shall be reasonably required by Lender on
terms consistent with the commercial property insurance policy required
under subsection (i) above;
(vii) umbrella liability insurance in addition to primary
coverage in an amount not less than $10,000,000.00.00 per occurrence on
terms consistent with the commercial general liability insurance policy
required under subsection (ii) above and (viii) below;
(viii) motor vehicle liability coverage for all owned and
non-owned vehicles, including rented and leased vehicles containing
minimum limits per occurrence of One Million and No/100 Dollars
($1,000,000.00);
(ix) so-called "dramshop" insurance or other liability
insurance required in connection with the sale of alcoholic beverages,
if served at the Property, and;
(x) If the commercial property and business income insurance
policies required under subsections (i) and (iii) above do not cover
perils of terrorism or acts of terrorism, Borrower shall maintain
commercial property and business income insurance for loss resulting
from perils and acts of terrorism on terms (including amounts)
consistent with those required under subsections (i) and (iii) above;
notwithstanding the foregoing, Borrower shall be required to obtain and
maintain terrorism insurance in an amount not less than the amount of
terrorism insurance that is available for an annual premium equal to
two (2) times Borrower's then current premium for the "all-risk"
insurance required under subsection (i) above (such limitation shall be
referred to as the "TERRORISM CAP") for terrorism insurance that is at
least equivalent to the existing terrorism insurance required under
this Section 5.1.1(a)(x); provided, however, the Terrorism Cap shall
not apply if (A) owners and/or operators of office buildings in the
same class as the Property in Massachusetts are generally obtaining
terrorism insurance, (B) lenders financing such office buildings in the
same class as the Property in Massachusetts are generally requiring
terrorism insurance as a condition of financing, or (C) Borrower
Principal or any Affiliates of Borrower Principal or any transferee of
Borrower Principal or any of its Affiliates, is obtaining terrorism
insurance on any other properties in Massachusetts which any of the
foregoing Persons own or operate. The claims paying ability rating of
the insurer shall be consistent with the requirements of Section 5.1.2
hereof or, if no insurer of such claims paying ability rating is then
issuing such terrorism insurance, the chosen insurer shall be the
insurer which is offering such terrorism insurance and which has a
claims paying ability rating the closest to that required by Section
5.1.2 hereof.
If perils of terrorism and acts of terrorism or other similar acts or
events are hereafter excluded from Borrower's comprehensive all risk
insurance policy or business income insurance coverage required under
subsections (i) and (iii) above, Borrower shall obtain an endorsement
to such policy, or a separate policy from an insurance provider which
meets the requirements set forth in Section 5.1.2 below or is otherwise
satisfactory to Lender, insuring against all such excluded acts or
events in the amounts required for such coverage under subsections (i)
and (iii) above, or such lesser amount as may be approved by Lender in
its sole discretion. The endorsement or policy shall be in form and
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substance reasonably satisfactory to Lender and shall meet Rating
Agency criteria for securitized loans.
(xi) upon sixty (60) days' notice, such other reasonable
insurance and in such reasonable amounts as Lender from time to time
may reasonably request against such other insurable hazards which at
the time are commonly insured against for property similar to the
Property located in or around the region in which the Property is
located.
(b) All insurance provided for in Section 5.1.1(a) shall be
obtained under valid and enforceable policies (collectively, the "POLICIES" or,
in the singular, the "POLICY") and, to the extent not specified above, shall be
subject to the approval of Lender as to deductibles, loss payees and insureds.
Not less than fifteen (15) days prior to the expiration dates of the Policies
theretofore furnished to Lender, certificates of insurance evidencing the
Policies accompanied by evidence satisfactory to Lender of payment of the
premiums then due thereunder (the "INSURANCE PREMIUMS"), shall be delivered by
Borrower to Lender.
(c) Any blanket insurance Policy shall specifically allocate
to the Property the amount of coverage from time to time required hereunder and
shall otherwise provide the same protection as would a separate Policy insuring
only the Property in compliance with the provisions of Section 5.1.1(a).
(d) All Policies of insurance provided for or contemplated by
Section 5.1.1(a) shall be primary coverage and, except for the Policy referenced
in Section 5.1.1(a)(v), shall name Borrower as the insured and Lender and its
successors and/or assigns as the additional insured, as its interests may
appear, and in the case of property damage, boiler and machinery, flood,
earthquake and terrorism insurance, shall contain a so-called New York standard
non contributing mortgagee clause in favor of Lender providing that the loss
thereunder shall be payable to Lender. Borrower shall not procure or permit any
of its constituent entities to procure any other insurance coverage which would
be on the same level of payment as the Policies or would adversely impact in any
way the ability of Lender or Borrower to collect any proceeds under any of the
Policies.
(e) All Policies of insurance provided for in Section
5.1.1(a), except for the Policies referenced in Sections 5.1.1(a)(v) and
(a)(viii), shall contain clauses or endorsements to the effect that:
(i) no act or negligence of Borrower, or anyone acting for
Borrower, or of any Tenant or other occupant, or failure to comply with
the provisions of any Policy, which might otherwise result in a
forfeiture of the insurance or any part thereof, shall in any way
affect the validity or enforceability of the insurance insofar as
Lender is concerned;
(ii) the Policy shall not be canceled or permitted to lapse
without at least thirty (30) days' written notice to Lender and any
other party named therein as an additional insured and, shall not be
materially changed (other than to increase the coverage provided
thereby) without such a thirty (30) day notice; and
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(iii) Lender shall not be liable for any Insurance Premiums
thereon or subject to any assessments thereunder.
(f) If at any time Lender is not in receipt of written
evidence that all insurance required hereunder is in full force and effect,
Lender shall have the right, without notice to Borrower, to take such action as
Lender deems necessary to protect its interest in the Property, including,
without limitation, the obtaining of such insurance coverage as Lender in its
sole discretion deems appropriate and all premiums incurred by Lender in
connection with such action or in obtaining such insurance and keeping it in
effect shall be paid by Borrower to Lender upon demand and until paid shall be
secured by the Mortgage and shall bear interest at the Default Rate.
(g) In the event of foreclosure of the Mortgage or other
transfer of title to the Property in extinguishment in whole or in part of the
Debt, all right, title and interest of Borrower in and to the Policies that are
not blanket Policies then in force concerning the Property and all proceeds
payable thereunder shall upon transfer of title to the Property vest in the
purchaser at such foreclosure or Lender or other transferee in the event of such
other transfer of title. 5.1.2 INSURANCE COMPANY. All Policies, excluding "flood
hazard" and "earthquake" Policies provided for in Section 5.1.1(a)(i) hereof,
shall be issued by financially sound and responsible insurance companies
authorized to do business in the state in which the Property is located and
having a claims paying ability rating of "A" or better by S&P and the equivalent
rating by one of the other Rating Agencies.
SECTION 5.2 CASUALTY AND CONDEMNATION.
5.2.1 CASUALTY. If the Property shall sustain a Casualty,
Borrower shall give prompt notice of such Casualty to Lender and shall promptly
commence and diligently prosecute to completion the repair and restoration of
the Property as nearly as possible to the condition the Property was in
immediately prior to such Casualty (a "RESTORATION") and otherwise in accordance
with Section 5.3, it being understood, however, that Borrower shall not be
obligated to restore the Property to the precise condition of the Property prior
to such Casualty provided the Property is restored, to the extent practicable,
to be of at least equal value and of substantially the same character as prior
to the Casualty. Borrower shall pay all costs of such Restoration whether or not
such costs are covered by insurance. Lender may, but shall not be obligated to,
make proof of loss if not made promptly by Borrower. In the event of a Casualty
where the loss does not exceed the Restoration Threshold, Borrower may settle
and adjust such claim; provided that (a) no Event of Default has occurred and is
continuing and (b) such adjustment is carried out in a commercially reasonable
and timely manner. In the event of a Casualty where the loss exceeds the
Restoration Threshold or if an Event of Default then exists, Borrower may settle
and adjust such claim only with the prior written consent of Lender (which
consent shall not be unreasonably withheld or delayed) and Lender shall have the
opportunity to participate, at Borrower's cost, in any such adjustments.
Notwithstanding any Casualty, Borrower shall continue to pay the Debt at the
time and in the manner provided for its payment in the Note and in this
Agreement.
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5.2.2 CONDEMNATION. Borrower shall give Lender prompt notice
of any actual or threatened Condemnation by any Governmental Authority of all or
any part of the Property and shall deliver to Lender a copy of any and all
papers served in connection with such proceedings. Borrower may settle and
compromise the Condemnation only with prior written the consent of Lender (which
consent shall not be unreasonably withheld or delayed) and Lender shall have the
opportunity to participate, at Borrower's cost, in any litigation and settlement
discussions in respect thereof and Borrower shall from time to time deliver to
Lender all instruments requested by Lender to permit such participation.
Borrower shall, at its expense, diligently prosecute any such proceedings, and
shall consult with Lender, its attorneys and experts, and cooperate with them in
the carrying on or defense of any such proceedings following an Event of Default
that remains uncured. Lender is hereby irrevocably appointed as Borrower's
attorney-in-fact, coupled with an interest, with exclusive power to collect,
receive and retain any Award and to make any compromise or settlement in
connection with any such Condemnation. Notwithstanding any Condemnation,
Borrower shall continue to pay the Debt at the time and in the manner provided
for its payment in the Note and in this Agreement. Lender shall not be limited
to the interest paid on the Award by any Governmental Authority but shall be
entitled to receive out of the Award interest at the rate or rates provided
herein or in the Note. If the Property or any portion thereof is taken by any
Governmental Authority, Borrower shall promptly commence and diligently
prosecute the Restoration of the Property and otherwise comply with the
provisions of Section 5.3. If the Property is sold, through foreclosure or
otherwise, prior to the receipt by Lender of the Award, Lender shall have the
right, whether or not a deficiency judgment on the Note shall have been sought,
recovered or denied, to receive the Award, or a portion thereof sufficient to
pay the Debt.
5.2.3 CASUALTY PROCEEDS. Notwithstanding the last sentence of
Section 5.1.1(a)(iii) and provided no Event of Default then exists hereunder,
proceeds received by Lender on account of the business interruption insurance
specified in Section 5.1.1(a)(iii) above with respect to any Casualty shall be
deposited by Lender directly into the Lockbox Account (as defined in the Cash
Management Agreement) but (a) only to the extent it reflects a replacement for
lost Rents that would have been due under Leases existing on the date of such
Casualty, and (b) only to the extent necessary to fully make the disbursements
required by Sections 3.3(a)(i) through (vi) of the Cash Management Agreement.
All other such proceeds shall be held by Lender and disbursed in accordance with
Section 5.3 hereof.
SECTION 5.3 DELIVERY OF NET PROCEEDS.
5.3.1 MINOR CASUALTY OR CONDEMNATION. If a Casualty or
Condemnation has occurred to the Property and the Net Proceeds shall be less
than the Restoration Threshold and the costs of completing the Restoration shall
be less than the Restoration Threshold, and provided (a) no Event of Default
shall have occurred and remain uncured and (b) the Casualty or Condemnation
shall have occurred prior to the Maturity Date, the Net Proceeds will be
promptly disbursed by Lender to Borrower. Promptly after receipt of the Net
Proceeds, Borrower shall commence and satisfactorily complete with due diligence
the Restoration in accordance with the terms of this Agreement. If any Net
Proceeds are received by Borrower and may be retained by Borrower pursuant to
the terms hereof, such Net Proceeds shall, until completion of the Restoration,
be held in trust for Lender and shall be segregated from other funds of Borrower
to be used to pay for the cost of Restoration in accordance with the terms
hereof.
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5.3.2 MAJOR CASUALTY OR CONDEMNATION.(a) If a Casualty or
Condemnation has occurred to the Property and the Net Proceeds are equal to or
greater than the Restoration Threshold or the costs of completing the
Restoration is equal to or greater than the Restoration Threshold, Lender shall
make the Net Proceeds available for the Restoration, provided that each of the
following conditions are met:
(i) no Event of Default shall have occurred and be continuing;
(ii) (A) in the event the Net Proceeds are insurance proceeds,
less than thirty-five percent (35%) of the total floor area of the
Improvements at the Property has been damaged, destroyed or rendered
unusable as a result of such Casualty or (B) in the event the Net
Proceeds are an Award, less than fifteen percent (15%) of the land
constituting the Property is taken, and such land is located along the
perimeter or periphery of the Property, and no portion of the
Improvements is the subject of the Condemnation;
(iii) Leases requiring payment of annual rent equal to
sixty-five percent (65%) of the Gross Income from Operations received
by Borrower during the twelve (12) month period immediately preceding
the Casualty or Condemnation and all Major Leases shall remain in full
force and effect during and after the completion of the Restoration
without abatement of rent beyond the time required for Restoration,
notwithstanding the occurrence of such Casualty or Condemnation;
(iv) Borrower shall commence the Restoration as soon as
reasonably practicable (but in no event later than sixty (60) days
after such Casualty or Condemnation, whichever the case may be, occurs)
and shall diligently pursue the same to satisfactory completion;
(v) Lender shall be satisfied that any operating deficits and
all payments of interest under the Note will be paid during the period
required for Restoration from (A) the Net Proceeds, or (B) other funds
of Borrower;
(vi) Lender shall be satisfied that the Restoration will be
completed on or before the earliest to occur of (A) the date six (6)
months prior to the Maturity Date, (B) the earliest date required for
such completion under the terms of any Major Lease, (C) such time as
may be required under applicable Legal Requirements in order to repair
and restore the Property to the condition it was in immediately prior
to such Casualty or to as nearly as possible the condition it was in
immediately prior to such Condemnation, as applicable or (D) the
expiration of the insurance coverage referred to in Section
5.1.1(a)(iii);
(vii) the Property and the use thereof after the Restoration
will be in compliance with and permitted under all applicable Legal
Requirements;
(viii) the Restoration shall be done and completed by Borrower
in an expeditious and diligent fashion and in compliance with all
applicable Legal Requirements;
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(ix) such Casualty or Condemnation, as applicable, does not
result in the loss of legal access to the Property or the related
Improvements;
(x) all Operating Agreements shall remain in full force and
effect; and
(xi) After giving effect to such Restoration, the Debt Service
Coverage Ratio for the Property shall be equal to the greater of (i)
the Debt Service Coverage Ratio for the twelve (12) full calendar
months immediately preceding the Closing Date, and (ii) the Debt
Service Coverage Ratio for the Property for the twelve (12) full
calendar months immediately preceding the Casualty or Condemnation of
the Property.
(b) The Net Proceeds shall be paid directly to Lender and held
by Lender in an interest-bearing account, which interest shall accrue for
Borrower's benefit, and, until disbursed in accordance with the provisions of
this Section 5.3.2, shall constitute additional security for the Debt. The Net
Proceeds (including all interest earned thereon) shall be disbursed by Lender
to, or as directed by, Borrower from time to time during the course of the
Restoration, upon receipt of evidence reasonably satisfactory to Lender that (i)
all requirements set forth in Section 5.3.2(a) have been satisfied, (ii) all
materials installed and work and labor performed (except to the extent that they
are to be paid for out of the requested disbursement) in connection with the
Restoration have been paid for in full, and (iii) there exist no notices of
pendency, stop orders, mechanic's or materialman's liens or notices of intention
to file same, or any other liens or encumbrances of any nature whatsoever on the
Property arising out of the Restoration which have not either been fully bonded
to the satisfaction of Lender and discharged of record or in the alternative
fully insured to the satisfaction of Lender by the title company issuing the
Title Insurance Policy.
(c) All plans and specifications required in connection with
the Restoration shall be subject to prior reasonable approval of Lender and an
independent architect reasonably selected by Lender (the "CASUALTY CONSULTANT").
The plans and specifications shall require that the Restoration be completed in
a first-class workmanlike manner at least equivalent to the quality and
character of the original work in the Improvements (provided, however, that in
the case of a partial Condemnation, the Restoration shall be done to the extent
reasonably practicable after taking into account the consequences of such
partial Condemnation), so that upon completion thereof, the Property shall be at
least equal in value and general utility to the Property prior to the damage or
destruction; it being understood, however, that Borrower shall not be obligated
to restore the Property to the precise condition of the Property prior to such
Casualty provided the Property is restored, to the extent practicable, to be of
at least equal value and of substantially the same character as prior to the
Casualty. Borrower shall restore all Improvements such that when they are fully
restored and/or repaired, such Improvements and their contemplated use fully
comply with all applicable material Legal Requirements. The identity of the
contractors, subcontractors and materialmen engaged in the Restoration, as well
as the contracts under which they have been engaged, shall be subject to
reasonable approval by Lender and the Casualty Consultant. All costs and
expenses incurred by Lender in connection with recovering, holding and advancing
the Net Proceeds for the Restoration including, without limitation, reasonable
attorneys' fees and disbursements and the Casualty Consultant's fees and
disbursements, shall be paid by Borrower.
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(d) In no event shall Lender be obligated to make
disbursements of the Net Proceeds in excess of an amount equal to the costs
actually incurred from time to time for work in place as part of the
Restoration, as certified by the Casualty Consultant, less the Casualty
Retainage. The term "CASUALTY RETAINAGE" shall mean, as to each contractor,
subcontractor or materialman engaged in the Restoration, an amount equal to ten
percent (10%) of the costs actually incurred for work in place as part of the
Restoration, as certified by the Casualty Consultant, until the Restoration has
been completed. The Casualty Retainage shall in no event, and notwithstanding
anything to the contrary set forth above in this Section 5.3.2(d), be less than
the amount actually held back by Borrower from contractors, subcontractors and
materialmen engaged in the Restoration. The Casualty Retainage shall not be
released until the Casualty Consultant certifies to Lender that the Restoration
has been completed in accordance with the provisions of this Section 5.3.2(d)
and that all approvals necessary for the re-occupancy and use of the Property
have been obtained from all appropriate Governmental Authorities, and Lender
receives evidence satisfactory to Lender that the costs of the Restoration have
been paid in full or will be paid in full out of the Casualty Retainage;
provided, however, that Lender will release the portion of the Casualty
Retainage being held with respect to any contractor, subcontractor or
materialman engaged in the Restoration as of the date upon which the Casualty
Consultant certifies to Lender that the contractor, subcontractor or materialman
has satisfactorily completed all work and has supplied all materials in
accordance with the provisions of the contractor's, subcontractor's or
materialman's contract, the contractor, subcontractor or materialman delivers
the lien waivers and evidence of payment in full of all sums due to the
contractor, subcontractor or materialman as may be reasonably requested by
Lender or by the title company issuing the Title Insurance Policy, and Lender
receives an endorsement to the Title Insurance Policy insuring the continued
priority of the lien of the Mortgage and evidence of payment of any premium
payable for such endorsement. If required by Lender, the release of any such
portion of the Casualty Retainage shall be approved by the surety company, if
any, which has issued a payment or performance bond with respect to the
contractor, subcontractor or materialman.
(e) Lender shall not be obligated to make disbursements of the
Net Proceeds more frequently than once every calendar month.
(f) If at any time the Net Proceeds or the undisbursed balance
thereof shall not, in the opinion of Lender in consultation with the Casualty
Consultant, be sufficient to pay in full the balance of the costs which are
estimated by the Casualty Consultant to be incurred in connection with the
completion of the Restoration, Borrower shall deposit the deficiency (the "NET
PROCEEDS DEFICIENCY") with Lender before any further disbursement of the Net
Proceeds shall be made. The Net Proceeds Deficiency deposited with Lender shall
be held by Lender and shall be disbursed for costs actually incurred in
connection with the Restoration on the same conditions applicable to the
disbursement of the Net Proceeds, and until so disbursed pursuant to this
Section 5.3.2 shall constitute additional security for the Debt.
(g) The excess, if any, of the Net Proceeds and the remaining
balance, if any, of the Net Proceeds Deficiency deposited with Lender after the
Casualty Consultant certifies to Lender that the Restoration has been completed
in accordance with the provisions of this Section 5.3.2, and the receipt by
Lender of evidence satisfactory to Lender that all costs incurred in connection
with the Restoration have been paid in full, shall be remitted by Lender to
Borrower, provided no Event of Default shall have occurred and shall be
continuing under any of the Loan Documents; provided, however, the amount of
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such excess returned to Borrower in the case of a Condemnation shall not exceed
the amount of Net Proceeds Deficiency deposited by Borrower with the balance
being applied to the Debt in the manner provided for in subsection 5.3.2(h).
(h) All Net Proceeds not required (i) to be made available for
the Restoration or (ii) to be returned to Borrower as excess Net Proceeds
pursuant to Section 5.3.2(g) may be retained and applied by Lender toward the
payment of the Debt, whether or not then due and payable, in such order,
priority and proportions as Lender in its sole discretion shall deem proper, or,
at the discretion of Lender, the same may be paid, either in whole or in part,
to Borrower for such purposes as Lender shall designate, without prepayment
premium or other penalty.
VI. RESERVE FUNDS
SECTION 6.1 REQUIRED REPAIR FUNDS.
6.1.1 DEPOSIT OF REQUIRED REPAIR FUNDS. Borrower shall perform
the repairs at the Property as set forth on Schedule II hereto (such repairs
hereinafter referred to as "REQUIRED REPAIRS") and shall complete each of the
Required Repairs on or before the respective deadline for each repair as set
forth on Schedule II. On the Closing Date, Borrower shall deposit with Lender
the amount that is one hundred and twenty-five percent (125%) of the cost to
perform such Required Repairs as set forth on Schedule II hereto to perform the
Required Repairs. Amounts deposited pursuant to this Section 6.1.1 are referred
to herein as the "REQUIRED REPAIR FUNDS."
6.1.2 RELEASE OF REQUIRED REPAIR FUNDS. With respect to any
item of Required Repairs which has been completed, Lender shall disburse, or
cause to be disbursed, to Borrower the Required Repair Funds upon satisfaction
by Borrower of each of the following conditions: (a) Borrower shall submit a
request for payment to Lender at least ten (10) days prior to the date on which
Borrower requests such payment be made and specifies the Required Repairs to be
paid, (b) on the date such request is received by Lender and on the date such
payment is to be made, no Event of Default shall exist and remain uncured, (c)
Lender shall have received a certificate from Borrower (i) stating that all
Required Repairs to be funded by the requested disbursement have been completed
in a good and workmanlike manner and in accordance with all applicable Legal
Requirements, such certificate to be accompanied by a copy of any license,
permit or other approval by any Governmental Authority, if any, required in
connection with the Required Repairs, (ii) identifying each Person that supplied
materials or labor in connection with the Required Repairs to be funded by the
requested disbursement, and (iii) stating that each such Person has been paid in
full or will be paid in full upon such disbursement, such certificate to be
accompanied by lien waivers or other evidence of payment satisfactory to Lender,
(d) at Lender's option, a title search for the Property indicating that the
Property is free from all liens, claims and other encumbrances not previously
approved by Lender, (e) at Lender's option, if the cost of the Required Repairs
exceeds Twenty-Five Thousand and No/100 Dollars ($25,000.00), Lender shall have
received a report satisfactory to Lender in its reasonable discretion from an
architect or engineer approved by Lender in respect of such architect or
engineer's inspection of the required repairs, and (f) Lender shall have
received such other evidence as Lender shall reasonably request that the
Required Repairs to be funded by the requested disbursement have been completed
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and are paid for or will be paid upon such disbursement to Borrower. Lender
shall not be required to disburse Required Repair Funds more frequently than
once each calendar month, and the requested disbursement must be at least in an
amount equal to the Minimum Disbursement Amount (or a lesser amount if the total
Required Repair Funds is less than the Minimum Disbursement Amount, in which
case only one disbursement of the amount remaining in the account shall be
made). Lender shall have the right, but not the obligation, to make any of the
Required Repairs in the event Borrower fails to perform same in accordance with
Section 6.1.1.
SECTION 6.2 TAX FUNDS.
6.2.1 DEPOSITS OF TAX FUNDS. On the Closing Date, Borrower
shall deposit with Lender the amount of Twenty Nine Thousand Eight Hundred Forty
Five and 90/100 Dollars ($29,845.90) and there shall be deposited to the
appropriate Accounts on each Monthly Payment Date an amount equal to one-twelfth
of the Taxes that Lender estimates will be payable during the next ensuing
twelve (12) months in order to accumulate sufficient funds to pay all such Taxes
at least ten (10) days prior to their respective due dates. Amounts deposited
pursuant to this Section 6.2.1 are referred to herein as the "TAX FUNDS." If at
any time Lender reasonably determines that the Tax Funds will not be sufficient
to pay the Taxes, Lender shall notify Borrower of such determination and the
monthly deposits for Taxes shall be increased by the amount that Lender
estimates is sufficient to make up the deficiency at least ten (10) days prior
to the respective delinquent dates for the Taxes; provided that if Borrower
receives notice of any deficiency after the date that is ten (10) days prior to
the date that Taxes are due, Borrower will deposit such amount within two (2)
Business Days after its receipt of such notice.
6.2.2 RELEASE OF TAX FUNDS. Unless an Event of Default has
occurred and is continuing, Lender shall apply the Tax Funds to payments of
Taxes. In making any payment relating to Taxes, Lender may do so according to
any xxxx, statement or estimate procured from the appropriate public office
(with respect to Taxes) without inquiry into the accuracy of such xxxx,
statement or estimate or into the validity of any tax, assessment, sale,
forfeiture, tax lien or title or claim thereof. If the amount of the Tax Funds
shall exceed the amounts due for Taxes, Lender shall, in its sole discretion,
return any excess to Borrower or credit such excess against future payments to
be made to the Tax Funds. Any Tax Funds remaining after the Debt has been paid
in full shall be returned to Borrower.
SECTION 6.3 INSURANCE FUNDS.
6.3.1 DEPOSITS OF INSURANCE FUNDS. On the Closing Date,
Borrower shall deposit with Lender the amount of Five Thousand Seven Hundred
Thirty and No/100 Dollars ($5,730.00) and there shall be deposited to the
appropriate Accounts on each Monthly Payment Date an amount equal to one-twelfth
of the Insurance Premiums that Lender estimates will be payable for the renewal
of the coverage afforded by the Policies upon the expiration thereof in order to
accumulate sufficient funds to pay all such Insurance Premiums at least thirty
(30) days prior to the expiration of the Policies. Amounts deposited pursuant to
this Section 6.3.1 are referred to herein as the "INSURANCE FUNDS". If at any
time Lender reasonably determines that the Insurance Funds will not be
sufficient to pay the Insurance Premiums, Lender shall notify Borrower of such
determination and the monthly deposits for Insurance Premiums shall be increased
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by the amount that Lender estimates is sufficient to make up the deficiency at
least thirty (30) days prior to expiration of the Policies.
6.3.2 RELEASE OF INSURANCE FUNDS. Unless an Event of Default
has occurred and is continuing, Lender shall apply the Insurance Funds to
payment of Insurance Premiums. In making any payment relating to Insurance
Premiums, Lender may do so according to any xxxx, statement or estimate procured
from the insurer or its agent, without inquiry into the accuracy of such xxxx,
statement or estimate. If the amount of the Insurance Funds shall exceed the
amounts due for Insurance Premiums, Lender shall return any excess to Borrower.
Any Insurance Funds remaining after the Debt has been paid in full shall be
returned to Borrower.
SECTION 6.4 CAPITAL EXPENDITURE FUNDS.
6.4.1 DEPOSITS OF CAPITAL EXPENDITURE FUNDS. On the Closing
Date, Borrower shall deposit with Lender the amount of Two Thousand Five Hundred
Fourteen and 16/100 Dollars ($2,514.16) and there shall be deposited to the
appropriate Accounts on each Monthly Payment Date, an amount equal to Two
Thousand Five Hundred Fourteen and 16/100 Dollars ($2,514.16) for annual Capital
Expenditures approved by Lender, which approval shall not be unreasonably
withheld or delayed; provided, however, Borrower shall have no obligation to
make deposits under this Section 6.4.1 during any month in which the amount then
on deposit in the appropriate Account is greater than or equal to $250,000.
Amounts deposited pursuant to this Section 6.4.1 are referred to herein as the
"CAPITAL EXPENDITURE FUNDS." Lender may reassess its estimate of the amount
necessary for capital expenditures from time to time and, and may require
Borrower to increase the monthly deposits required pursuant to this Section
6.4.1 upon thirty (30) days notice to Borrower if Lender determines in its
reasonable discretion that an increase is necessary to maintain proper operation
of the Property.
6.4.2 RELEASE OF CAPITAL EXPENDITURE FUNDS.
(a) Lender shall disburse, or cause to be disbursed, Capital
Expenditure Funds only for Capital Expenditures.
(b) Lender shall disburse, or cause to be disbursed, to
Borrower the Capital Expenditure Funds upon satisfaction by Borrower of each of
the following conditions: (i) Borrower shall submit a request for payment to
Lender at least ten (10) days prior to the date on which Borrower requests such
payment be made and specifies the Capital Expenditures to be paid, (ii) on the
date such request is received by Lender and on the date such payment is to be
made, no Event of Default shall exist and remain uncured, (iii) Lender shall
have received a certificate from Borrower (A) stating that the items to be
funded by the requested disbursement are Capital Expenditures, (B) stating that
all Capital Expenditures at the Property to be funded by the requested
disbursement have been completed in a good and workmanlike manner and in
accordance with all applicable Legal Requirements, such certificate to be
accompanied by a copy of any license, permit or other approval required by any
Governmental Authority, if any, in connection with the Capital Expenditures, (C)
identifying each Person that supplied materials or labor in connection with the
Capital Expenditures to be funded by the requested disbursement, and (D) stating
that each such Person has been paid in full or will be paid in full upon such
disbursement, such certificate to be accompanied by lien waivers or other
evidence of payment satisfactory to Lender, (iv) at Lender's option, a title
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search for the Property indicating that the Property is free from all Liens,
claims and other encumbrances not previously approved by Lender, (v) at Lender's
option, if the cost of any individual Capital Expenditure exceeds Twenty Five
Thousand and No/100 Dollars ($25,000.00), Lender shall have received a report
satisfactory to Lender in its reasonable discretion from an architect or
engineer approved by Lender in respect of such architect or engineer's
inspection of the required repairs, and (vi) Lender shall have received such
other evidence as Lender shall reasonably request that the Capital Expenditures
at the Property to be funded by the requested disbursement have been completed
and are paid for or will be paid upon such disbursement to Borrower. Lender
shall not be required to disburse Capital Expenditure Funds more frequently than
once each calendar month, and each disbursement must be at least an amount
greater than the Minimum Disbursement Amount (or a lesser amount if the total
amount of Capital Expenditure Funds is less than the Minimum Disbursement
Amount, in which case only one disbursement of the amount remaining in the
account shall be made).
(c) Nothing in this Section 6.4.2 shall (i) make Lender
responsible for making or completing the Capital Expenditures Work; (ii) require
Lender to expend funds in addition to the Capital Expenditure Funds to complete
any Capital Expenditures Work; (iii) obligate Lender to proceed with the Capital
Expenditures Work; or (iv) obligate Lender to demand from Borrower additional
sums to complete any Capital Expenditures Work.
(d) Borrower shall permit Lender and Lender's agents and
representatives (including, without limitation, Lender's engineer, architect, or
inspector) or third parties to enter onto the Property during normal business
hours (subject to the rights of Tenants under their Leases) to inspect the
progress of any Capital Expenditures Work and all materials being used in
connection therewith and to examine all plans and shop drawings relating to such
Capital Expenditures Work. Any such inspection shall be conducted in a manner
designed to minimize interference with Tenants or Borrower's operation of the
Property. Borrower shall cause all contractors and subcontractors to cooperate
with Lender or Lender's representatives or such other Persons described above in
connection with inspections described in this Section 6.4.2(d).
SECTION 6.5 ROLLOVER FUNDS.
6.5.1 DEPOSITS OF ROLLOVER FUNDS. On the Closing Date,
Borrower shall deposit with Lender the amount of Thirty Two Thousand and No/00
Dollars ($32,000.00) and there shall be deposited to the appropriate Account on
each Monthly Payment Date the sum of Thirty Two Thousand and No/00 Dollars
($32,000.00), for tenant improvements and leasing commissions, lease
cancellation fees, buy-out fees or a similar cost that may be incurred following
the date hereof; provided, however, Borrower shall have no obligation to make
deposits under this Section 6.5.1 during any month in which the amount then on
deposit in the appropriate Account is greater than or equal to $500,000. Amounts
deposited pursuant to this Section 6.5.1 are referred to herein as the "ROLLOVER
FUNDS."
6.5.2 RELEASE OF ROLLOVER FUNDS. Lender shall disburse, or
cause to be disbursed, to Borrower the Rollover Funds upon satisfaction by
Borrower of each of the following conditions: (a) Borrower shall submit a
request for payment to Lender at least ten (10) days prior to the date on which
Borrower requests such payment be made and specifies the tenant improvement
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costs and leasing commissions to be paid, (b) on the date such request is
received by Lender and on the date such payment is to be made, no Event of
Default shall exist and remain uncured, (c) subject to Section 4.1.9 hereof,
Lender shall have reviewed and approved the Lease in respect of which Borrower
is obligated to pay or reimburse certain tenant improvement costs and leasing
commissions (to the extent approval is required pursuant to Section 4.1.9
hereof), (d) Lender shall have received and approved a budget for tenant
improvement costs and a schedule of leasing commissions payments and the
requested disbursement will be used to pay all or a portion of such costs and
payments, (e) Lender shall have received a certificate from Borrower (i) stating
that all tenant improvements at the Property to be funded by the requested
disbursement have been completed in good and workmanlike manner and in
accordance with all applicable federal, state and local laws, rules and
regulations, such certificate to be accompanied by a copy of any license, permit
or other approval by any Governmental Authority required in connection with the
Capital Expenditures, (ii) identifying each Person that supplied materials or
labor in connection with the tenant improvements to be funded by the requested
disbursement, and (iii) stating that each such Person has been paid in full or
will be paid in full upon such disbursement, such certificate to be accompanied
by lien waivers or other evidence of payment satisfactory to Lender, (f) at
Lender's option, a title search for the Property indicating that the Property is
free from all Liens, claims and other encumbrances not previously approved by
Lender, (g) Lender shall have received an estoppel certificate from the
applicable tenant stating that (i) all required work is complete and (ii) such
tenant is in occupancy and paying full unabated rent or has taken possession of
the demised premises, and (h) Lender shall have received such other evidence as
Lender shall reasonably request that the tenant improvements at the Property to
be funded by the requested disbursement have been completed and are paid for or
will be paid upon such disbursement to Borrower. Lender shall not be required to
disburse Rollover Funds more frequently than once each calendar month, and each
disbursement must be in an amount greater than the Minimum Disbursement Amount
(or a lesser amount if the total amount of Rollover Funds is less than the
Minimum Disbursement Amount, in which case only one disbursement of the amount
remaining in the account shall be made).
SECTION 6.6 INTENTIONALLY DELETED.
SECTION 6.7 SECURITY INTEREST IN RESERVE FUNDS.
6.7.1 GRANT OF SECURITY INTEREST. Borrower hereby pledges to
Lender, and grants to Lender a security interest in, any and all monies now or
hereafter deposited in the Reserve Funds as additional security for the payment
of the Loan. The Reserve Funds shall be held in Lender's name and may be
commingled with Lender's own funds at financial institutions selected by Lender
in its sole discretion. Upon the occurrence of an Event of Default, Lender may
apply any sums then present in the Reserve Funds to the payment of the Loan in
any order in its sole discretion. Until expended or applied as above provided,
the Reserve Funds shall constitute additional security for the Loan. Lender
shall have no obligation to release any of the Reserve Funds while any Event of
Default or Default then exists.
6.7.2 INTEREST ON RESERVE FUNDS. All interest or income earned
on any and all funds on deposit in any of the Reserve Funds shall be accumulated
for the benefit of Borrower.
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6.7.3 PROHIBITION AGAINST FURTHER ENCUMBRANCE. Borrower shall
not, without the prior consent of Lender, further pledge, assign or grant any
security interest in the Reserve Funds or permit any lien or encumbrance to
attach thereto, or any levy to be made thereon, or any UCC-1 Financing
Statements, except those naming Lender as the secured party, to be filed with
respect thereto.
VII. PROPERTY MANAGEMENT SECTION
7.1 THE MANAGEMENT AGREEMENT.
Borrower shall cause Manager to manage the Property in
accordance with the Management Agreement. Borrower shall (a) diligently perform
and observe all of the terms, covenants and conditions of the Management
Agreement on the part of Borrower to be performed and observed, (b) promptly
notify Lender of any notice to Borrower of any default that has occurred and is
continuing beyond expiration of applicable cure periods by Borrower in the
performance or observance of any of the terms, covenants or conditions of the
Management Agreement on the part of Borrower to be performed and observed, and
(c) promptly deliver to Lender a copy of each financial statement, business
plan, capital expenditures plan, report and estimate received by it under the
Management Agreement. If Borrower shall default beyond expiration of applicable
cure periods in the performance or observance of any material term, covenant or
condition of the Management Agreement on the part of Borrower to be performed or
observed, then, without limiting Lender's other rights or remedies under this
Agreement or the other Loan Documents, and without waiving or releasing Borrower
from any of its obligations hereunder or under the Management Agreement, Lender
shall have the right, but shall be under no obligation, to pay any sums and to
perform any act as may be appropriate to cause all the material terms, covenants
and conditions of the Management Agreement on the part of Borrower to be
performed or observed.
SECTION 7.2 PROHIBITION AGAINST TERMINATION OR MODIFICATION.
Borrower shall not surrender, terminate, cancel, modify,
renew, amend, or extend the Management Agreement, or enter into any other
agreement relating to the management or operation of the Property with Manager
or any other Person, or consent to the assignment by the Manager of its interest
under the Management Agreement, in each case without the express written consent
of Lender, which consent shall not be unreasonably withheld; provided, however,
with respect to a new manager such consent may be conditioned upon Borrower
delivering a Rating Agency Confirmation as to such new manager and management
agreement and, if such new manager is an Affiliate of Borrower, upon delivery of
a non-consolidation opinion acceptable to the Rating Agencies. If at any time
Lender consents to the appointment of a new manager, such new manager and
Borrower shall, as a condition of Lender's consent, execute a subordination of
management agreement in the form then used by Lender. Notwithstanding the
foregoing, Borrower shall have the right to terminate the Management Agreement
and enter into a new management agreement upon terms reasonably acceptable to
Lender with the Approved Property Manager; provided, however, Borrower shall (i)
pay all of Lender's expenses in connection therewith, and (ii) enter into an
Assignment of Management Agreement with Lender similar to that which Lender and
Manager have entered into as of the date hereof.
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SECTION 7.3 REPLACEMENT OF MANAGER.
Lender shall have the right to require Borrower to replace the
Manager with a Person which is not an Affiliate of, but is chosen by, Borrower
and approved by Lender upon the occurrence of any one or more of the following
events: (a) at any time following the occurrence of an Event of Default, (b) if
Manager shall be in default under the Management Agreement beyond any applicable
notice and cure period and/or (c) if Manager becomes insolvent or is adjudicated
bankrupt or if any petition for bankruptcy shall be filed against or consented
to by Manager.
VIII. TRANSFERS
SECTION 8.1 PROHIBITED TRANSFER OR ENCUMBRANCE OF PROPERTY.
(a) Borrower shall not cause or permit a Sale or Pledge of the
Property or any part thereof or any legal or beneficial interest therein nor
permit a Sale or Pledge of an interest in any Restricted Party (in each case, a
"PROHIBITED Transfer"), other than pursuant to Leases of space in the
Improvements to Tenants in accordance with the provisions of Section 4.1.9,
without the prior written consent of Lender.
(b) A Prohibited Transfer shall include, but not be limited
to, (i) an installment sales agreement wherein Borrower agrees to sell the
Property or any part thereof for a price to be paid in installments; (ii) an
agreement by Borrower leasing all or a substantial part of the Property for
other than actual occupancy by a space tenant thereunder or a sale, assignment
or other transfer of, or the grant of a security interest in, Borrower's right,
title and interest in and to any Leases or any Rents; (iii) if a Restricted
Party is a corporation, any merger, consolidation or Sale or Pledge of such
corporation's stock or the creation or issuance of new stock in one or a series
of transactions; (iv) if a Restricted Party is a limited or general partnership
or joint venture, any merger or consolidation or the change, removal,
resignation or addition of a general partner or the Sale or Pledge of the
partnership interest of any general or limited partner or any profits or
proceeds relating to such partnership interests or the creation or issuance of
new partnership interests; (v) if a Restricted Party is a limited liability
company, any merger or consolidation or the change, removal, resignation or
addition of a managing member or non-member manager (or if no managing member,
any member) or the Sale or Pledge of the membership interest of any member or
any profits or proceeds relating to such membership interest; (vi) if a
Restricted Party is a trust or nominee trust, any merger, consolidation or the
Sale or Pledge of the legal or beneficial interest in a Restricted Party or the
creation or issuance of new legal or beneficial interests; or (vii) the removal
or the resignation of the Manager (including, without limitation, an Affiliated
Manager) other than in accordance with Article VII.
(c) Notwithstanding the provisions of Section 8.1(b), the
following transfers shall not be deemed to be a Prohibited Transfer: (i) a
transfer by devise or descent or by operation of law upon the death of a member,
partner or shareholder of a Restricted Party; (ii) the Sale or Pledge, in one or
a series of transactions, of not more than forty-nine percent (49%) of the
stock, limited partnership interests or non-managing membership interests (as
the case may be) in a Restricted Party; provided, however, no such transfers
shall result in a change in Control in the Restricted Party or change in control
of the Property, and as a condition to each such transfer, Lender shall receive
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not less than twenty (20) days prior written notice of such proposed transfer,
(iii) the sale, transfer, cancellation or issuance of stock or other securities
of Cedar Shopping Centers, Inc., a Maryland corporation, provided such stock or
other securities are listed on the New York Stock Exchange or such other
nationally recognized stock exchange, (iv) transfers of direct or indirect
membership interests in Borrower between any then existing I&G Fund to another
I&G Fund, provided that (A) Borrower shall maintain its status as a single
purpose, bankruptcy remote entity under criteria established by the Rating
Agencies, (B) if after giving effect to such transfer and all prior transfers,
more than forty-nine percent (49%) in the aggregate of direct or indirect
interests in Borrower are owned by any Person and its Affiliates that owned less
than a forty nine percent (49%) direct or indirect interest in Borrower as of
the Closing Date, Lender shall receive a non consolidation opinion acceptable to
Lender and the Rating Agencies, (v) from and after a transfer pursuant to
Sections 8.2.2(a) or (b), transfers amongst the then existing members of
Cedar-Franklin Village 2 LLC of their direct membership interests in
Cedar-Franklin Village 2 LLC, provided that (A) Borrower shall maintain its
status as a single purpose, bankruptcy remote entity under criteria established
by the Rating Agencies, (B) if after giving effect to such transfer and all
prior transfers, more than forty-nine percent (49%) in the aggregate of direct
or indirect interests in Borrower are owned by any Person and its Affiliates
that owned less than a forty nine percent (49%) direct or indirect interest in
Borrower as of the Closing Date, Lender shall receive a non consolidation
opinion acceptable to Lender and the Rating Agencies and (vi) transfers of
interests in the I&G Funds by investors in such I&G Funds.
(d) Lender reserves the right to condition the consent to a
Prohibited Transfer requested hereunder upon (a) a modification of the terms
hereof and on assumption of the Note and the other Loan Documents as so modified
by the proposed Prohibited Transfer, (b) receipt of payment of a transfer fee
equal to 0.5% of the outstanding principal balance of the Loan and all of
Lender's expenses actually incurred in connection with such Prohibited Transfer,
(c) receipt of Rating Agency Confirmation with respect to the transfer, (d) the
proposed transferee's continued compliance with the covenants set forth in this
Agreement (including, without limitation, the covenants in Section 3.1.24) and
the other Loan Documents, (e) a new manager for the Property and a new
management agreement satisfactory to Lender, (f) a new guaranty(ies) and
environmental indemnity, substantially in the form of the Guaranty, Supplemental
Guaranty, and Environmental Indemnity delivered contemporaneously with this
Agreement, from guarantor(s) and indemnitor(s) satisfactory to Lender, and (g)
the satisfaction of such other conditions and/or legal opinions as Lender shall
determine in its sole discretion to be in the interest of Lender. All expenses
incurred by Lender shall be payable by Borrower whether or not Lender consents
to the Prohibited Transfer. Lender shall not be required to demonstrate any
actual impairment of its security or any increased risk of default hereunder in
order to declare the Debt immediately due and payable upon a Prohibited Transfer
made without Lender's consent. This provision shall apply to each and every
Prohibited Transfer, whether or not Lender has consented to any previous
Prohibited Transfer. Notwithstanding anything to the contrary contained in this
Section 8.1(d), in the event a substantive non-consolidation opinion was
delivered to Lender and the Rating Agencies in connection with the closing of
the Loan, and if any Prohibited Transfer results in any Person and its
Affiliates owning in excess of forty-nine percent (49%) of the ownership
interests in a Restricted Party, Borrower shall, prior to such transfer, and in
addition to any other requirement for Lender consent contained herein, deliver a
revised substantive non-consolidation opinion to Lender reflecting such
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Prohibited Transfer, which opinion shall be in form, scope and substance
acceptable in all respects to Lender and the Rating Agencies.
SECTION 8.2 PERMITTED TRANSFERS
8.2.1 PERMITTED TRANSFER OF THE PROPERTY
(a) Notwithstanding the provisions of Section 8.1, Borrower
shall have a one-time right to sell or otherwise transfer the Property while the
Loan or any portion thereof is outstanding, subject to the satisfaction of the
following conditions:
(i) no Event of Default shall have occurred and remain
uncured;
(ii) the proposed transferee ("TRANSFEREE") shall be a
Permitted Transferee and shall be a reputable entity or person of good
character, creditworthy, with sufficient financial worth considering
the obligations assumed and undertaken, as evidenced by financial
statements and other information reasonably requested by Lender;
(iii) the Transferee and its property manager shall have
sufficient experience in the ownership and management of properties
similar to the Property, and Lender shall be provided with reasonable
evidence thereof (and Lender reserves the right to approve the
Transferee without approving the substitution of the property manager);
(iv) Lender shall have received Rating Agency Confirmation
with respect to the transfer;
(v) Lender shall have received evidence satisfactory to it
(which shall include a legal non-consolidation opinion acceptable to
Lender) that the single purpose nature and bankruptcy remoteness of
Borrower its shareholders, partners, or members, as the case may be,
following such transfer are in accordance with the standards of the
Rating Agencies;
(vi) the Transferee shall have executed and delivered to
Lender an assumption agreement in form and substance acceptable to
Lender, evidencing such Transferee's agreement to abide and be bound by
the terms of the Note, the Mortgage and the other Loan Documents,
together with such legal opinions and Title Insurance endorsements as
may be reasonably requested by Lender; and
(vii) Lender shall have received on or prior to the date of
the sale or transfer (A) an assumption fee equal to one-half of one
percent (0.50%) of the then unpaid principal balance of the Note, (B) a
rating confirmation fee for each of the Rating Agencies delivering a
Rating Agency Confirmation pursuant to clause (iv) above, which
confirmation fees shall be equal to the then customary fees charged by
each applicable Rating Agency for such a confirmation and (C) the
payment of all costs and expenses actually incurred by Lender and the
Rating Agencies in connection with such assumption (including
reasonable attorneys' fees and costs).
(viii) the Transferee shall comply with the provisions of
Section 3.1.38 hereof.
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8.2.2 PERMITTED TRANSFER OF INTEREST IN BORROWER
(a) Notwithstanding the provisions of Section 8.1, Borrower
and the holder of any direct or indirect owner of ownership interest in Borrower
shall have the right to transfer of not more than an aggregate of 80% of the
direct or indirect ownership interests in the Borrower to a Qualified
Transferee, provided that (i) no Event of Default shall have occurred and be
continuing, (ii) Borrower shall pay all out-of-pocket fees and expenses actually
incurred by Lender in connection with such Transfer including, without
limitation, the cost of any third party reports, reasonable legal fees and
expenses, or required legal opinions, (iii) Lender shall have received thirty
(30) days advance written notice from Borrower of such Transfer, (iv) Lender
shall have received such documents, certificates and legal opinions as it may
reasonably request, (v) if after giving effect to such Transfer and all prior
transfers, more than forty-nine percent (49%) in the aggregate of direct or
indirect interests in Borrower are owned by any Person and its Affiliates that
owned less than a forty nine percent (49%) direct or indirect interest in
Borrower as of the Closing Date, Lender shall receive a non consolidation
opinion acceptable to Lender and the Rating Agencies (vi) Borrower shall
maintain its status as a single purpose, bankruptcy remote entity under criteria
established by the Rating Agencies, (vii) if after giving effect to such
transfer and all prior transfers, more than forty-nine percent (49%) in the
aggregate of direct or indirect interests in Borrower are proposed to be
transferred, Lender shall have received a Rating Agency Confirmation, (viii) the
Transferee shall comply with the provisions of Section 3.1.38 hereof and (ix)
the Property is managed by an Approved Property Manager.
(b) Notwithstanding the provisions of Section 8.1, Borrower
and the holder of any direct or indirect owner of ownership interest in Borrower
shall have the right to transfer of not more than an aggregate of 80% of the
direct or indirect ownership interests in the Borrower to one or more of the I&G
Funds, provided that (i) no Event of Default shall have occurred and be
continuing, (ii) Borrower shall pay all out-of-pocket fees and expenses actually
incurred by Lender in connection with such Transfer including, without
limitation, the cost of any third party reports, reasonable legal fees and
expenses, or required legal opinions, (iii) Lender shall have received thirty
(30) days advance written notice from Borrower of such Transfer, (iv) Lender
shall have received such documents, certificates and legal opinions as it may
reasonably request, (v) if after giving effect to such Transfer and all prior
transfers, more than forty-nine percent (49%) in the aggregate of direct or
indirect interests in Borrower are owned by any Person and its Affiliates that
owned less than a forty nine percent (49%) direct or indirect interest in
Borrower as of the Closing Date, Lender shall receive a non consolidation
opinion acceptable to Lender and the Rating Agencies (vi) Borrower shall
maintain its status as a single purpose, bankruptcy remote entity under criteria
established by the Rating Agencies, (vii) the Transferee shall comply with the
provisions of Section 3.1.38 hereof, (viii) Borrower provides an Officer's
Certificate that as of the date of the transfer, the I&G Funds' net worth has
not materially decreased since the date hereof and (ix) the Property is managed
by an Approved Property Manager.
SECTION 8.3 SUBSTITUTE GUARANTOR.
Solely in connection with Transfers permitted pursuant to
Sections 8.2.1, 8.1(c)(v) and 8.2.2, Borrower may substitute the Guarantor under
the Guaranty, the Supplemental Guaranty and the Environmental Indemnity
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(collectively, the "GUARANTIES") with another guarantor ("SUBSTITUTE GUARANTOR")
provided that: (i) such Substitute Guarantor satisfies the requirements of a
Qualified Transferee as of the date of the proposed substitution and is
otherwise acceptable to Lender in its sole discretion; and (ii) such Substitute
Guarantor executes the Guaranties, in the form identical to Guaranties executed
by Guarantor as of the Closing Date. Upon such substitution in accordance with
the provisions of this Section 8.3 the former Guarantor shall be released from
any liability or other obligation under each of the Guaranties.
IX. SALE AND SECURITIZATION OF MORTGAGE SECTION
9.1 SALE OF MORTGAGE AND SECURITIZATION.
(a) Lender shall have the right (i) to sell or otherwise
transfer the Loan or any portion thereof as a whole loan, (ii) to sell
participation interests in the Loan or (iii) to securitize the Loan or any
portion thereof in a single asset securitization or a pooled loan
securitization. (The transactions referred to in clauses (i), (ii) and (iii)
shall hereinafter be referred to collectively as "SECONDARY MARKET TRANSACTIONS"
and the transaction referred to in clause (iii) shall hereinafter be referred to
as a "SECURITIZATION." Any certificates, notes or other securities issued in
connection with a Securitization are hereinafter referred to as "SECURITIES").
(b) If requested by Lender, at not material cost to Borrower,
Borrower shall assist Lender in satisfying the market standards to which Lender
customarily adheres or which may be reasonably required in the marketplace or by
the Rating Agencies in connection with any Secondary Market Transactions,
including, without limitation, to:
(i) (A) provide updated financial and other information with
respect to the Property, the business operated at the Property,
Borrower and the Manager, (B) provide updated budgets relating to the
Property and (C) provide updated appraisals, market studies,
environmental reviews (Phase I's and, if appropriate, Phase II's),
property condition reports and other due diligence investigations of
the Property (the "UPDATED INFORMATION"), together, with appropriate
verification of the Updated Information through letters of auditors or
opinions of counsel acceptable to Lender and the Rating Agencies;
(ii) provide opinions of counsel, which may be relied upon by
Lender, the Rating Agencies and their respective counsel, agents and
representatives, as to non-consolidation or any other opinion customary
in Secondary Market Transactions or required by the Rating Agencies
with respect to the Property and Borrower and Affiliates, which counsel
and opinions shall be reasonably satisfactory to Lender and the Rating
Agencies;
(iii) provide updated, as of the closing date of the Secondary
Market Transaction, representations and warranties made in the Loan
Documents and such additional representations and warranties as the
Rating Agencies may require;
(iv) execute such amendments to the Loan Documents and
Borrower's organizational documents reasonably requested by Lender,
including, without limitation, amending the Monthly Payment Date, the
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execution of one or more replacement loan agreements, as may be
requested by Lender or the Rating Agencies to effect the Securitization
and/or deliver one or more new component notes to replace the original
note or modify the original note to reflect multiple components of the
Loan (and such new notes or modified note shall have the same initial
weighted average coupon of the original note, but such new notes or
modified note may change the interest rate, Monthly Payment Date and
amortization of the Loan), and modify the Cash Management Agreement
with respect to the newly created components such that the pricing and
marketability of the Securities and the size of each class of
Securities and the rating assigned to each such class by the Rating
Agencies shall provide the most favorable rating levels and achieve the
optimum rating levels for the Loan; provided, however, any such
amendments or agreements will not result in an economic change in the
Loan terms and will not materially alter the payment terms set forth in
this Agreement or the other Loan Documents or materially and adversely
affect Borrower or impose additional material obligations or
liabilities upon Borrower; and
(v) attend management meetings and conduct tours of the
Property.
SECTION 9.2 SECURITIZATION INDEMNIFICATION.
(a) Borrower understands that information provided to Lender
by Borrower and its agents, counsel and representatives may be included in
disclosure documents in connection with the Securitization, including, without
limitation, an offering circular, a prospectus, prospectus supplement, private
placement memorandum or other offering document (each, a "DISCLOSURE DOCUMENT")
and may also be included in filings with the Securities and Exchange Commission
pursuant to the Securities Act of 1933, as amended (the "SECURITIES ACT"), or
the Securities and Exchange Act of 1934, as amended (the "EXCHANGE ACT"), and
may be made available to investors or prospective investors in the Securities,
the Rating Agencies, and service providers relating to the Securitization.
(b) Borrower shall provide in connection with each of (i) a
preliminary and a final private placement memorandum or (ii) a preliminary and
final prospectus or prospectus supplement, as applicable, an agreement (A)
certifying that Borrower has examined such Disclosure Documents specified by
Lender and that each such Disclosure Document, as it relates to Borrower,
Borrower Affiliates, the Property, Manager and all other aspects of the Loan,
does not contain any untrue statement of a material fact or omit to state a
material fact necessary in order to make the statements made, in the light of
the circumstances under which they were made, not misleading, (B) indemnifying
Lender (and for purposes of this Section 9.2, Lender hereunder shall include its
officers and directors), the Affiliate of Lender that has filed the registration
statement relating to the Securitization (the "REGISTRATION STATEMENT"), each of
its directors, each of its officers who have signed the Registration Statement
and each Person that controls the Affiliate within the meaning of Section 15 of
the Securities Act or Section 20 of the Exchange Act (collectively, the "LENDER
GROUP"), and Lender, and any other placement agent or underwriter with respect
to the Securitization, each of their respective directors and each Person who
controls Lender or any other placement agent or underwriter within the meaning
of Section 15 of the Securities Act and Section 20 of the Exchange Act
(collectively, the "UNDERWRITER GROUP") for any losses, claims, damages or
liabilities (collectively, the "LIABILITIES") to which Lender, the Lender Group
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or the Underwriter Group may become subject insofar as the Liabilities arise out
of or are based upon any untrue statement or alleged untrue statement of any
material fact contained in such sections or arise out of or are based upon the
omission or alleged omission to state therein a material fact required to be
stated in such sections or necessary in order to make the statements in such
sections, in light of the circumstances under which they were made, not
misleading and (C) agreeing to reimburse Lender, the Lender Group and/or the
Underwriter Group for any legal or other expenses reasonably incurred by Lender,
the Lender Group and the Underwriter Group in connection with investigating or
defending the Liabilities; provided, however, that Borrower will be liable in
any such case under clauses (B) or (C) above only to the extent that any such
loss claim, damage or liability arises out of or is based upon any such untrue
statement or omission made therein in reliance upon and in conformity with
information furnished to Lender by or on behalf of Borrower in connection with
the preparation of the Disclosure Document or in connection with the
underwriting or closing of the Loan, including, without limitation, financial
statements of Borrower, operating statements and rent rolls with respect to the
Property. This indemnity agreement will be in addition to any liability which
Borrower may otherwise have.
(c) In connection with Exchange Act Filings, Borrower shall
(i) indemnify Lender, the Lender Group and the Underwriter Group for Liabilities
to which Lender, the Lender Group or the Underwriter Group may become subject
insofar as the Liabilities arise out of or are based upon the omission or
alleged omission to state in the Disclosure Document a material fact required to
be stated in the Disclosure Document in order to make the statements in the
Disclosure Document, in light of the circumstances under which they were made,
not misleading and (ii) reimburse Lender, the Lender Group or the Underwriter
Group for any reasonable legal or other expenses actually and reasonably
incurred by Lender, the Lender Group or the Underwriter Group in connection with
defending or investigating the Liabilities.
(d) Promptly after receipt by an indemnified party under this
Section 9.2 of notice of the commencement of any action, such indemnified party
will, if a claim in respect thereof is to be made against the indemnifying party
under this Section 9.2, notify the indemnifying party in writing of the
commencement thereof, but the omission to so notify the indemnifying party will
not relieve the indemnifying party from any liability which the indemnifying
party may have to any indemnified party hereunder except to the extent that
failure to notify causes prejudice to the indemnifying party. In the event that
any action is brought against any indemnified party, and it notifies the
indemnifying party of the commencement thereof, the indemnifying party will be
entitled, jointly with any other indemnifying party, to participate therein and,
to the extent that it (or they) may elect by written notice delivered to the
indemnified party promptly after receiving the aforesaid notice from such
indemnified party, to assume the defense thereof with counsel reasonably
satisfactory to such indemnified party. After notice from the indemnifying party
to such indemnified party under this Section 9.2, such indemnified party shall
pay for any legal or other expenses subsequently incurred by such indemnified
party in connection with the defense thereof other than reasonable costs of
investigation; provided, however, if the defendants in any such action include
both the indemnified party and the indemnifying party and the indemnified party
shall have reasonably concluded that there are any legal defenses available to
it and/or other indemnified parties that are different from or additional to
those available to the indemnifying party, the indemnified party or parties
shall have the right to select separate counsel to assert such legal defenses
and to otherwise participate in the defense of such action on behalf of such
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indemnified party at the cost of the indemnifying party. The indemnifying party
shall not be liable for the expenses of more than one separate counsel unless an
indemnified party shall have reasonably concluded that there may be legal
defenses available to it that are different from or additional to those
available to another indemnified party.
(e) In order to provide for just and equitable contribution in
circumstances in which the indemnity agreement provided for in Section 9.2(b) or
(c) is for any reason held to be unenforceable as to an indemnified party in
respect of any losses, claims, damages or liabilities (or action in respect
thereof) referred to therein which would otherwise be indemnifiable under
Section 9.2(b) or (c), the indemnifying party shall contribute to the amount
paid or payable by the indemnified party as a result of such losses, claims,
damages or liabilities (or action in respect thereof); provided, however, that
no Person guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the Securities Act) shall be entitled to contribution from any Person
who was not guilty of such fraudulent misrepresentation. In determining the
amount of contribution to which the respective parties are entitled, the
following factors shall be considered: (i) Lender's and Borrower's relative
knowledge and access to information concerning the matter with respect to which
the claim was asserted; (ii) the opportunity to correct and prevent any
statement or omission; and (iii) any other equitable considerations appropriate
in the circumstances. Lender and Borrower hereby agree that it would not be
equitable if the amount of such contribution were determined by pro rata or per
capita allocation.
(f) The liabilities and obligations of both Borrower and
Lender under this Section 9.2 shall survive the termination of this Agreement
and the satisfaction and discharge of the Debt.
X. DEFAULTS
SECTION 10.1 EVENT OF DEFAULT.
(a) Each of the following events shall constitute an event of
default hereunder (an "EVENT OF DEFAULT"):
(i) if (A) any monthly installment of interest due under the
Note or the payment due on the Maturity Date is not paid within five
(5) days of the date when due or (B) any other portion of the Debt is
not paid when due and such non-payment in this Section 10.1(a)(i)(B)
continues for five (5) days following notice to Borrower that the same
is due and payable;
(ii) if any of the Taxes or Other Charges are not paid when
due (except to the extent (A) Lender is obligated to disburse Tax Funds
for the payment of Taxes pursuant to Section 6.2.2 hereof, (B) Lender
has sufficient Tax Funds in the Tax Funds account for such payment to
make such payment, (C) no other Event of Default shall have occurred
and (D) Lender fails to make such payment of Taxes);
(iii) if the Policies are not kept in full force and effect
provided, however, if Borrower has deposited sufficient funds into the
Insurance Account (as defined in the Cash Management Agreement) for the
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purchase of the Policies in accordance with Section 6.3 hereof, the
failure to maintain such Policies due solely to non-payment of the
Insurance Premiums shall not be deemed an Event of Default hereunder;
(iv) if Borrower breaches or permits or suffers a breach of
Article 6 of the Mortgage or Article VIII of this Agreement;
(v) if any representation or warranty made by Borrower herein
or in any other Loan Document, or in any report, certificate, financial
statement or other instrument, agreement or document furnished to
Lender shall have been false or misleading in any material respect as
of the date the representation or warranty was made;
(vi) if Borrower, any SPC Party or Guarantor shall make an
assignment for the benefit of creditors;
(vii) if Borrower fails or admits its inability to pay debts
generally as they become due;
(viii) if a receiver, liquidator or trustee shall be appointed
for Borrower, any SPC Party or Guarantor or if Borrower, any SPC Party
or Guarantor shall be adjudicated bankrupt or insolvent, or if any
petition for bankruptcy, reorganization or arrangement pursuant to
federal bankruptcy law, or any similar federal or state law, shall be
filed by or against, consented to, or acquiesced in by, Borrower, any
SPC Party or Guarantor, or if any proceeding for the dissolution or
liquidation of Borrower, any SPC Party or Guarantor shall be
instituted; provided, however, if such appointment, adjudication,
petition or proceeding was involuntary and not consented to by
Borrower, and SPC Party or Guarantor, upon the same not being
discharged, stayed or dismissed within forty-five (45) days or if an
order for relief is entered;
(ix) if Borrower assigns its rights under this Agreement or
any of the other Loan Documents or any interest herein or therein in
contravention of the Loan Documents;
(x) Intentionally Deleted;
(xi) if any of the assumptions contained in the Insolvency
Opinion, or in any other non-consolidation opinion delivered to Lender
in connection with the Loan, or in any other non-consolidation
delivered subsequent to the closing of the Loan, is or shall become
untrue in any material respect and Borrower fails to deliver
updates/corrections within thirty (30) days of request therefor;
(xii) if Borrower breaches any representation, warranty or
covenant contained in Section 3.1.24 hereof;
(xiii) intentionally omitted;
(xiv) if Guarantor breaches in any material respect any
covenant, warranty or representation contained in the Guaranty or the
Supplemental Guaranty;
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(xv) if Borrower shall continue to be in Default under any of
the other terms, covenants or conditions of this Agreement not
specified in subsections (i) through and including (xv) above, for ten
(10) days after notice to Borrower from Lender, in the case of any
Default which can be cured by the payment of a sum of money, or for
thirty (30) days after notice from Lender in the case of any other
Default; provided, however, that if such non monetary Default is
susceptible of cure but cannot reasonably be cured within such thirty
(30) day period and provided further that Borrower shall have commenced
to cure such Default within such thirty (30) day period and thereafter
diligently and expeditiously proceeds to cure the same, such thirty
(30) day period shall be extended for such time as is reasonably
necessary for Borrower in the exercise of due diligence to cure such
Default, such additional period not to exceed ninety (90) days; or
(xvi) if there shall be Default under any of the other Loan
Documents beyond any applicable cure periods contained in such Loan
Documents, whether as to Borrower or the Property, or if any other such
event shall occur or condition shall exist, if the effect of such event
or condition is to accelerate the maturity of any portion of the Debt
or to permit Lender to accelerate the maturity of all or any portion of
the Debt.
(b) Upon the occurrence of an Event of Default (other than an
Event of Default described in Sections 10.1(a)(vi), (vii) or (viii) above) and
at any time thereafter Lender may, in addition to any other rights or remedies
available to it pursuant to this Agreement and the other Loan Documents or at
law or in equity, take such action, without notice or demand, that Lender deems
advisable to protect and enforce its rights against Borrower and in and to the
Property, including, without limitation, declaring the Debt to be immediately
due and payable, and Lender may enforce or avail itself of any or all rights or
remedies provided in the Loan Documents against Borrower and the Property,
including, without limitation, all rights or remedies available at law or in
equity; and upon any Event of Default described in Sections 10.1(a)(vi), (vii)
or (viii) above, the Debt and all other obligations of Borrower hereunder and
under the other Loan Documents shall immediately and automatically become due
and payable, without notice or demand, and Borrower hereby expressly waives any
such notice or demand, anything contained herein or in any other Loan Document
to the contrary notwithstanding.
SECTION 10.2 REMEDIES.
(a) Upon the occurrence of an Event of Default, all or any one
or more of the rights, powers, privileges and other remedies available to Lender
against Borrower under this Agreement or any of the other Loan Documents
executed and delivered by, or applicable to, Borrower or at law or in equity may
be exercised by Lender at any time and from time to time, whether or not all or
any of the Debt shall be declared due and payable, and whether or not Lender
shall have commenced any foreclosure proceeding or other action for the
enforcement of its rights and remedies under any of the Loan Documents with
respect to the Property. Any such actions taken by Lender shall be cumulative
and concurrent and may be pursued independently, singly, successively, together
or otherwise, at such time and in such order as Lender may determine in its sole
discretion, to the fullest extent permitted by law, without impairing or
otherwise affecting the other rights and remedies of Lender permitted by law,
equity or contract or as set forth herein or in the other Loan Documents.
Without limiting the generality of the foregoing and subject to applicable law,
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if an Event of Default is continuing (i) Lender is not subject to any "one
action" or "election of remedies" law or rule, and (ii) all liens and other
rights, remedies or privileges provided to Lender shall remain in full force and
effect until Lender has exhausted all of its remedies against the Property and
the Mortgage has been foreclosed, sold and/or otherwise realized upon in
satisfaction of the Debt or the Debt has been paid in full.
(b) Subject to applicable law, Lender shall have the right
from time to time to partially foreclose the Mortgage in any manner and for any
amounts secured by the Mortgage then due and payable as determined by Lender in
its sole discretion including, without limitation, the following circumstances:
(i) in the event Borrower defaults beyond any applicable grace period in the
payment of one or more scheduled payments of principal and interest, Lender may
foreclose the Mortgage to recover such delinquent payments, or (ii) in the event
Lender elects to accelerate less than the entire outstanding principal balance
of the Loan, Lender may foreclose the Mortgage to recover so much of the
principal balance of the Loan as Lender may accelerate and such other sums
secured by the Mortgage as Lender may elect. Notwithstanding one or more partial
foreclosures, the Property shall remain subject to the Mortgage to secure
payment of sums secured by the Mortgage and not previously recovered.
(c) Lender shall have the right from time to time to sever the
Note and the other Loan Documents into one or more separate notes, mortgages and
other security documents (the "SEVERED LOAN DOCUMENTS") in such denominations as
Lender shall determine in its sole discretion for purposes of evidencing and
enforcing its rights and remedies provided hereunder. Borrower shall execute and
deliver to Lender from time to time, promptly after the request of Lender, a
severance agreement and such other documents as Lender shall request in order to
effect the severance described in the preceding sentence, all in form and
substance reasonably satisfactory to Lender. Borrower hereby absolutely and
irrevocably appoints Lender as its true and lawful attorney, coupled with an
interest, in its name and stead to make and execute all documents necessary or
desirable to effect the aforesaid severance, Borrower ratifying all that its
said attorney shall do by virtue thereof; provided, however, Lender shall not
make or execute any such documents under such power until three (3) days after
notice has been given to Borrower by Lender of Lender's intent to exercise its
rights under such power. Except as may be required in connection with a
Securitization pursuant to Section 9.1 hereof, (i) Borrower shall not be
obligated to pay any costs or expenses incurred in connection with the
preparation, execution, recording or filing of the Severed Loan Documents, and
(ii) the Severed Loan Documents shall not contain any representations,
warranties or covenants not contained in the Loan Documents and any such
representations and warranties contained in the Severed Loan Documents will be
given by Borrower only as of the Closing Date.
(d) Any amounts recovered from the Property or any other
collateral for the Loan after an Event of Default may be applied by Lender
toward the payment of any interest and/or principal of the Loan and/or any other
amounts due under the Loan Documents in such order, priority and proportions as
Lender in its sole discretion shall determine.
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SECTION 10.3 RIGHT TO CURE DEFAULTS.
Lender may, but without any obligation to do so and without
notice to or demand on Borrower and without releasing Borrower from any
obligation hereunder or being deemed to have cured any Event of Default
hereunder, make, do or perform any obligation of Borrower hereunder in such
manner and to such extent as Lender may deem necessary. Lender is authorized to
enter upon the Property for such purposes, or appear in, defend, or bring any
action or proceeding to protect its interest in the Property for such purposes,
and the cost and expense actually incurred thereof (including reasonable
attorneys' fees to the extent permitted by law), with interest as provided in
this Section 10.3, shall constitute a portion of the Debt and shall be due and
payable to Lender upon demand. All such costs and expenses actually incurred by
Lender in remedying such Event of Default or such failed payment or act or in
appearing in, defending, or bringing any action or proceeding shall bear
interest at the Default Rate, for the period after such cost or expense was
incurred to the date of payment to Lender. All such costs and expenses incurred
by Lender together with interest thereon calculated at the Default Rate shall be
deemed to constitute a portion of the Debt and be secured by the liens, claims
and security interests provided to Lender under the Loan Documents and shall be
immediately due and payable upon demand by Lender therefore.
SECTION 10.4 REMEDIES CUMULATIVE.
The rights, powers and remedies of Lender under this Agreement
shall be cumulative and not exclusive of any other right, power or remedy which
Lender may have against Borrower pursuant to this Agreement or the other Loan
Documents, or existing at law or in equity or otherwise. Lender's rights, powers
and remedies may be pursued singly, concurrently or otherwise, at such time and
in such order as Lender may determine in Lender's sole discretion. No delay or
omission to exercise any remedy, right or power accruing upon an Event of
Default shall impair any such remedy, right or power or shall be construed as a
waiver thereof, but any such remedy, right or power may be exercised from time
to time and as often as may be deemed expedient. A waiver of one Default or
Event of Default with respect to Borrower shall not be construed to be a waiver
of any subsequent Default or Event of Default by Borrower or to impair any
remedy, right or power consequent thereon.
XI. MISCELLANEOUS
SECTION 11.1 SUCCESSORS AND ASSIGNS.
Whenever in this Agreement any of the parties hereto is
referred to, such reference shall be deemed to include the legal
representatives, successors and assigns of such party. All covenants, promises
and agreements in this Agreement, by or on behalf of Borrower, shall inure to
the benefit of the legal representatives, successors and assigns of Lender.
SECTION 11.2 LENDER'S DISCRETION.
Whenever pursuant to this Agreement Lender exercises any right
given to it to approve or disapprove, or any arrangement or term is to be
satisfactory to Lender, the decision of Lender to approve or disapprove or to
decide whether arrangements or terms are satisfactory or not satisfactory shall
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(except as is otherwise specifically herein provided) be in the sole discretion
of Lender and shall be final and conclusive. Prior to a Securitization, whenever
pursuant to this Agreement the Rating Agencies are given any right to approve or
disapprove, or any arrangement or term is to be satisfactory to the Rating
Agencies, the decision of Lender to approve or disapprove or to decide whether
arrangements or terms are satisfactory or not satisfactory, based upon Lender's
determination of Rating Agency criteria, shall be substituted therefore.
SECTION 11.3 GOVERNING LAW.
(A) THIS AGREEMENT WAS NEGOTIATED IN THE STATE OF NEW YORK,
AND MADE BY LENDER AND ACCEPTED BY BORROWER IN THE STATE OF NEW YORK, AND THE
PROCEEDS OF THE NOTE DELIVERED PURSUANT HERETO WERE DISBURSED FROM THE STATE OF
NEW YORK, WHICH STATE THE PARTIES AGREE HAS A SUBSTANTIAL RELATIONSHIP TO THE
PARTIES AND TO THE UNDERLYING TRANSACTION EMBODIED HEREBY, AND IN ALL RESPECTS,
INCLUDING, WITHOUT LIMITING THE GENERALITY OF THE FOREGOING, MATTERS OF
CONSTRUCTION, VALIDITY AND PERFORMANCE, THIS AGREEMENT AND THE OBLIGATIONS
ARISING HEREUNDER SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE
LAWS OF THE STATE OF NEW YORK APPLICABLE TO CONTRACTS MADE AND PERFORMED IN SUCH
STATE (WITHOUT REGARD TO PRINCIPLES OF CONFLICT LAWS) AND ANY APPLICABLE LAW OF
THE UNITED STATES OF AMERICA, EXCEPT THAT AT ALL TIMES THE PROVISIONS FOR THE
CREATION, PERFECTION, AND ENFORCEMENT OF THE LIEN AND SECURITY INTEREST CREATED
PURSUANT HERETO AND PURSUANT TO THE OTHER LOAN DOCUMENTS SHALL BE GOVERNED BY
AND CONSTRUED ACCORDING TO THE LAW OF THE STATE IN WHICH THE PROPERTY IS
LOCATED, IT BEING UNDERSTOOD THAT, TO THE FULLEST EXTENT PERMITTED BY THE LAW OF
SUCH STATE, THE LAW OF THE STATE OF NEW YORK SHALL GOVERN THE CONSTRUCTION,
VALIDITY AND ENFORCEABILITY OF ALL LOAN DOCUMENTS AND ALL OF THE OBLIGATIONS
ARISING HEREUNDER OR THEREUNDER. TO THE FULLEST EXTENT PERMITTED BY LAW,
BORROWER HEREBY UNCONDITIONALLY AND IRREVOCABLY WAIVES ANY CLAIM TO ASSERT THAT
THE LAW OF ANY OTHER JURISDICTION GOVERNS THIS AGREEMENT AND THE NOTE, AND THIS
AGREEMENT AND THE NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE
LAWS OF THE STATE OF NEW YORK PURSUANT TO SECTION 5-1401 OF THE NEW YORK GENERAL
OBLIGATIONS LAW.
(B) ANY LEGAL SUIT, ACTION OR PROCEEDING AGAINST LENDER OR
BORROWER ARISING OUT OF OR RELATING TO THIS AGREEMENT MAY AT LENDER'S OPTION BE
INSTITUTED IN ANY FEDERAL OR STATE COURT IN XXX XXXX XX XXX XXXX, XXXXXX XX XXX
XXXX, PURSUANT TO SECTION 5-1402 OF THE NEW YORK GENERAL OBLIGATIONS LAW AND
BORROWER WAIVES ANY OBJECTIONS WHICH IT MAY NOW OR HEREAFTER HAVE BASED ON VENUE
AND/OR FORUM NON CONVENIENS OF ANY SUCH SUIT, ACTION OR PROCEEDING, AND BORROWER
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HEREBY IRREVOCABLY SUBMITS TO THE JURISDICTION OF ANY SUCH COURT IN ANY SUIT,
ACTION OR PROCEEDING. BORROWER DOES HEREBY DESIGNATE AND APPOINT:
Xxxxxx X. Xxxxxxxx
00 Xxxxx Xxxxxx Xxxxxx
Xxxx Xxxxxxxxxx, Xxx Xxxx 00000
AS ITS AUTHORIZED AGENT TO ACCEPT AND ACKNOWLEDGE ON ITS BEHALF SERVICE OF ANY
AND ALL PROCESS WHICH MAY BE SERVED IN ANY SUCH SUIT, ACTION OR PROCEEDING IN
ANY FEDERAL OR STATE COURT IN NEW YORK, NEW YORK, AND AGREES THAT SERVICE OF
PROCESS UPON SAID AGENT AT SAID ADDRESS AND WRITTEN NOTICE OF SAID SERVICE
MAILED OR DELIVERED TO BORROWER IN THE MANNER PROVIDED HEREIN SHALL BE DEEMED IN
EVERY RESPECT EFFECTIVE SERVICE OF PROCESS UPON BORROWER, IN ANY SUCH SUIT,
ACTION OR PROCEEDING IN THE STATE OF NEW YORK. BORROWER (I) SHALL GIVE PROMPT
NOTICE TO LENDER OF ANY CHANGED ADDRESS OF ITS AUTHORIZED AGENT HEREUNDER, (II)
MAY AT ANY TIME AND FROM TIME TO TIME DESIGNATE A SUBSTITUTE AUTHORIZED AGENT
WITH AN OFFICE IN NEW YORK, NEW YORK (WHICH SUBSTITUTE AGENT AND OFFICE SHALL BE
DESIGNATED AS THE PERSON AND ADDRESS FOR SERVICE OF PROCESS), AND (III) SHALL
PROMPTLY DESIGNATE SUCH A SUBSTITUTE IF ITS AUTHORIZED AGENT CEASES TO HAVE AN
OFFICE IN NEW YORK, NEW YORK OR IS DISSOLVED WITHOUT LEAVING A SUCCESSOR.
SECTION 11.4 MODIFICATION, WAIVER IN WRITING.
No modification, amendment, extension, discharge, termination
or waiver of any provision of this Agreement or of any other Loan Document, nor
consent to any departure by Borrower therefrom, shall in any event be effective
unless the same shall be in a writing signed by the party against whom
enforcement is sought, and then such waiver or consent shall be effective only
in the specific instance, and for the purpose, for which given. Except as
otherwise expressly provided herein, no notice to, or demand on Borrower, shall
entitle Borrower to any other or future notice or demand in the same, similar or
other circumstances.
SECTION 11.5 DELAY NOT A WAIVER.
Neither any failure nor any delay on the part of Lender in
insisting upon strict performance of any term, condition, covenant or agreement,
or exercising any right, power, remedy or privilege hereunder, or under any
other Loan Document, shall operate as or constitute a waiver thereof, nor shall
a single or partial exercise thereof preclude any other future exercise, or the
exercise of any other right, power, remedy or privilege. In particular, and not
by way of limitation, by accepting payment after the due date of any amount
payable under this Agreement or any other Loan Document, Lender shall not be
deemed to have waived any right either to require prompt payment when due of all
other amounts due under this Agreement or the other Loan Documents, or to
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declare a default for failure to effect prompt payment of any such other amount.
Lender shall have the right to waive or reduce any time periods that Lender is
entitled to under the Loan Documents in its sole and absolute discretion.
SECTION 11.6 NOTICES.
All notices, demands, requests, consents, approvals or other
communications (any of the foregoing, a "NOTICE") required, permitted, or
desired to be given hereunder shall be in writing sent by telefax (with answer
back acknowledged) or by registered or certified mail, postage prepaid, return
receipt requested, or delivered by hand or reputable overnight courier addressed
to the party to be so notified at its address hereinafter set forth, or to such
other address as such party may hereafter specify in accordance with the
provisions of this Section 11.6. Any Notice shall be deemed to have been
received: (a) three (3) days after the date such Notice is mailed, (b) on the
date of sending by facsimile transmission if sent during business hours on a
Business Day (otherwise on the next Business Day), (c) on the date of delivery
by hand if delivered during business hours on a Business Day (otherwise on the
next Business Day), and (d) on the next Business Day if sent by an overnight
commercial courier, in each case addressed to the parties as follows:
If to Lender:
Eurohypo AG, New York Branch
1114 Avenue of the Americas
Xxxxxx-Xxxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Head of Portfolio Operations
Facsimile No.: (000) 000-0000
with a copy to:
Eurohypo AG, New York Branch
1114 Avenue of the Americas
Xxxxxx-Xxxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Legal Director
Facsimile No.: (000) 000-0000
with a copy to:
Cadwalader, Xxxxxxxxxx & Xxxx LLP
000 Xxxxxx Xxxx
Xxx Xxxx, Xxx Xxxx 000000
Attention: Xxxxxxx X. Xxxxxxxxx, Esq.
Facsimile No.: (000) 000-0000
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If to Borrower:
Cedar-Franklin Village LLC
c/o Cedar Shopping Centers Partnership, L.P.
00 Xxxxx Xxxxxx Xxxxxx
Xxxxx 000
Xxxx Xxxxxxxxxx, XX 00000
Attention: Xxxxxx X. Xxxxxx and Xxxxxx X. Xxxxxxxx, Esq.
Facsimile No.: (000) 000-0000
with a copy to:
Stroock & Stroock, & Xxxxx, LLP
000 Xxxxxx Xxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxx X. Xxxxxxxxx
Facsimile No.: (000) 000-0000
SECTION 11.7 TRIAL BY JURY.
BORROWER AND LENDER EACH HEREBY AGREES NOT TO ELECT A TRIAL BY
JURY OF ANY ISSUE TRIABLE OF RIGHT BY JURY, AND WAIVES ANY RIGHT TO TRIAL BY
JURY FULLY TO THE EXTENT THAT ANY SUCH RIGHT SHALL NOW OR HEREAFTER EXIST WITH
REGARD TO THE LOAN DOCUMENTS, OR ANY CLAIM, COUNTERCLAIM OR OTHER ACTION ARISING
IN CONNECTION THEREWITH. THIS WAIVER OF RIGHT TO TRIAL BY JURY IS GIVEN
KNOWINGLY AND VOLUNTARILY BY BORROWER AND LENDER, AND IS INTENDED TO ENCOMPASS
INDIVIDUALLY EACH INSTANCE AND EACH ISSUE AS TO WHICH THE RIGHT TO A TRIAL BY
JURY WOULD OTHERWISE ACCRUE. EACH PARTY IS HEREBY AUTHORIZED TO FILE A COPY OF
THIS PARAGRAPH IN ANY PROCEEDING AS CONCLUSIVE EVIDENCE OF THIS WAIVER.
SECTION 11.8 HEADINGS.
The Article and/or Section headings and the Table of Contents
in this Agreement are included herein for convenience of reference only and
shall not constitute a part of this Agreement for any other purpose.
SECTION 11.9 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.
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SECTION 11.10 PREFERENCES.
Lender shall have the continuing and exclusive right to apply
or reverse and reapply any and all payments by Borrower to any portion of the
obligations of Borrower hereunder. To the extent Borrower makes a payment or
payments to Lender, which payment or proceeds or any part thereof are
subsequently invalidated, declared to be fraudulent or preferential, set aside
or required to be repaid to a trustee, receiver or any other party under any
bankruptcy law, state or federal law, common law or equitable cause, then, to
the extent of such payment or proceeds received, the obligations hereunder or
part thereof intended to be satisfied shall be revived and continue in full
force and effect, as if such payment or proceeds had not been received by
Lender.
SECTION 11.11 WAIVER OF NOTICE.
Borrower shall not be entitled to any notices of any nature
whatsoever from Lender except with respect to matters for which this Agreement
or the other Loan Documents specifically and expressly provide for the giving of
notice by Lender to Borrower and except with respect to matters for which
Borrower is not, pursuant to applicable Legal Requirements, permitted to waive
the giving of notice. Borrower hereby expressly waives the right to receive any
notice from Lender with respect to any matter for which this Agreement or the
other Loan Documents do not specifically and expressly provide for the giving of
notice by Lender to Borrower.
SECTION 11.12 REMEDIES OF BORROWER.
In the event that a claim or adjudication is made that Lender
or its agents have acted unreasonably or unreasonably delayed acting in any case
where, by law or under this Agreement or the other Loan Documents, Lender or
such agent, as the case may be, has an obligation to act reasonably or promptly,
neither Lender nor its agents shall be liable for any monetary damages, and
Borrower's sole remedy shall be limited to commencing an action seeking
injunctive relief or declaratory judgment. Any action or proceeding to determine
whether Lender has acted reasonably shall be determined by an action seeking
declaratory judgment.
SECTION 11.13 EXPENSES; INDEMNITY.
(a) Borrower shall pay or, if Borrower fails to pay, reimburse
Lender upon receipt of notice from Lender, for all reasonable costs and expenses
(including reasonable attorneys' fees and disbursements actually incurred by
Lender in connection with (i) the preparation, negotiation, execution and
delivery of this Agreement and the other Loan Documents and the consummation of
the transactions contemplated hereby and thereby and all the costs of furnishing
all opinions of counsel (including without limitation any opinions requested by
Lender as to any legal matters pertaining to this Agreement, the other Loan
Documents or the Property); (ii) Borrower's ongoing performance of and
compliance with Borrower's agreements and covenants contained in this Agreement
and the other Loan Documents on its part to be performed or complied with after
the Closing Date, including, without limitation, confirming compliance with
environmental and insurance requirements; (iii) the negotiation, preparation,
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execution, delivery and administration of any consents, amendments, waivers or
other modifications to this Agreement and the other Loan Documents and any other
documents or matters requested by Borrower; (iv) the filing and recording fees
and expenses, Title Insurance and reasonable fees and expenses of counsel for
providing to Lender all required legal opinions, and other similar expenses
incurred, in creating and perfecting the Liens in favor of Lender pursuant to
this Agreement and the other Loan Documents; (v) enforcing or preserving any
rights, in response to third party claims or the prosecuting or defending of any
action or proceeding or other litigation or otherwise, in each case against,
under or affecting Borrower, this Agreement, the other Loan Documents, the
Property, or any other security given for the Loan; and (vi) enforcing any
obligations of or collecting any payments due from Borrower under this
Agreement, the other Loan Documents or with respect to the Property or in
connection with any refinancing or restructuring of the credit arrangements
provided under this Agreement in the nature of a "work out" or of any insolvency
or bankruptcy proceedings; provided, however, that Borrower shall not be liable
for the payment of any such costs and expenses to the extent the same arise by
reason of the gross negligence, illegal acts, fraud, bad faith or willful
misconduct of Lender.
(b) Borrower shall indemnify, defend and hold harmless Lender
and its officers, directors, agents, employees (and the successors and assigns
of the foregoing) (the "LENDER INDEMNITEES") from and against any and all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
claims, costs, expenses and disbursements of any kind or nature whatsoever
(including, without limitation, the reasonable fees and disbursements of counsel
for the Lender Indemnitees in connection with any investigative, administrative
or judicial proceeding commenced or threatened, whether or not the Lender
Indemnitees shall be designated a party thereto), that may be imposed on,
incurred by, or asserted against the Lender Indemnitees in any manner relating
to or arising out of (i) any breach by Borrower of its obligations under, or any
material misrepresentation by Borrower contained in, this Agreement or the other
Loan Documents, or (ii) the use or intended use of the proceeds of the Loan
(collectively, the "INDEMNIFIED LIABILITIES"); provided, however, that Borrower
shall not have any obligation to the Lender Indemnitees hereunder to the extent
that such Indemnified Liabilities arise from the bad faith, gross negligence,
illegal acts, fraud or willful misconduct of the Lender Indemnitees. To the
extent that the undertaking to indemnify, defend and hold harmless set forth in
the preceding sentence may be unenforceable because it violates any law or
public policy, Borrower shall pay the maximum portion that it is permitted to
pay and satisfy under applicable law to the payment and satisfaction of all
Indemnified Liabilities incurred by the Lender Indemnitees.
SECTION 11.14 SCHEDULES INCORPORATED.
The Schedules annexed hereto are hereby incorporated herein as
a part of this Agreement with the same effect as if set forth in the body
hereof.
SECTION 11.15 OFFSETS, COUNTERCLAIMS AND DEFENSES.
Any assignee of Lender's interest in and to this Agreement and
the other Loan Documents shall take the same free and clear of all offsets,
counterclaims or defenses which are unrelated to such documents which Borrower
may otherwise have against any assignor of such documents, and no such unrelated
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counterclaim or defense shall be interposed or asserted by Borrower in any
action or proceeding brought by any such assignee upon such documents and any
such right to interpose or assert any such unrelated offset, counterclaim or
defense in any such action or proceeding is hereby expressly waived by Borrower.
SECTION 11.16 NO JOINT VENTURE OR PARTNERSHIP; NO THIRD PARTY
BENEFICIARIES.
(a) Borrower and Lender intend that the relationships created
hereunder and under the other Loan Documents be solely that of borrower and
lender. Nothing herein or therein is intended to create a joint venture,
partnership, tenancy in common, or joint tenancy relationship between Borrower
and Lender nor to grant Lender any interest in the Property other than that of
mortgagee, beneficiary or lender.
(b) This Agreement and the other Loan Documents are solely for
the benefit of Lender and nothing contained in this Agreement or the other Loan
Documents shall be deemed to confer upon anyone other than Lender or Borrower
any right to insist upon or to enforce the performance or observance of any of
the obligations contained herein or therein. All conditions to the obligations
of Lender to make the Loan hereunder are imposed solely and exclusively for the
benefit of Lender and no other Person shall have standing to require
satisfaction of such conditions in accordance with their terms or be entitled to
assume that Lender will refuse to make the Loan in the absence of strict
compliance with any or all thereof and no other Person shall under any
circumstances be deemed to be a beneficiary of such conditions, any or all of
which may be freely waived in whole or in part by Lender if, in Lender's sole
discretion, Lender deems it advisable or desirable to do so.
SECTION 11.17 PUBLICITY.
All news releases, publicity or advertising by Borrower or its
Affiliates through any media intended to reach the general public which refers
to the Loan Documents or the financing evidenced by the Loan Documents, to
Lender or any of its Affiliates shall be subject to the prior written approval
of Lender. Borrower authorizes Lender to issue press releases, advertisements
and other promotional materials in connection with Lender's own promotional and
marketing activities, including in connection with a Secondary Market
Transaction, and such materials may describe the Loan in general terms or in
detail and Lender's participation therein in the Loan. All references to Lender
contained in any press release, advertisement or promotional material issued by
Borrower shall be reasonably approved in writing by Lender in advance of
issuance.
SECTION 11.18 WAIVER OF MARSHALLING OF ASSETS.
To the fullest extent permitted by law, Borrower, for itself
and its successors and assigns, waives all rights to a marshalling of the assets
of Borrower, Borrower's partners and others with interests in Borrower, and of
the Property, and shall not assert any right under any laws pertaining to the
marshalling of assets, the sale in inverse order of alienation, homestead
exemption, the administration of estates of decedents, or any other matters
whatsoever to defeat, reduce or affect the right of Lender under the Loan
Documents to a sale of the Property for the collection of the Debt without any
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prior or different resort for collection or of the right of Lender to the
payment of the Debt out of the net proceeds of the Property in preference to
every other claimant whatsoever.
SECTION 11.19 WAIVER OF OFFSETS/DEFENSES/COUNTERCLAIMS.
Borrower hereby waives the right to assert a counterclaim,
other than a compulsory counterclaim, in any action or proceeding brought
against it by Lender or its agents or otherwise to offset any obligations to
make the payments required by the Loan Documents. No failure by Lender to
perform any of its obligations hereunder shall be a valid defense to, or result
in any offset against, any payments which Borrower is obligated to make under
any of the Loan Documents.
SECTION 11.20 CONFLICT; CONSTRUCTION OF DOCUMENTS; RELIANCE.
In the event of any conflict between the provisions of this
Agreement and any of the other Loan Documents, the provisions of this Agreement
shall control. The parties hereto acknowledge that they were represented by
competent counsel in connection with the negotiation, drafting and execution of
the Loan Documents and that such Loan Documents shall not be subject to the
principle of construing their meaning against the party which drafted them.
Borrower acknowledges that, with respect to the Loan, Borrower shall rely solely
on its own judgment and advisors in entering into the Loan without relying in
any manner on any statements, representations or recommendations of Lender or
any parent, subsidiary or Affiliate of Lender. Lender shall not be subject to
any limitation whatsoever in the exercise of any rights or remedies available to
it under any of the Loan Documents or any other agreements or instruments which
govern the Loan by virtue of the ownership by it or any parent, subsidiary or
Affiliate of Lender of any equity interest any of them may acquire in Borrower,
and Borrower hereby irrevocably waives the right to raise any defense or take
any action on the basis of the foregoing with respect to Lender's exercise of
any such rights or remedies. Borrower acknowledges that Lender engages in the
business of real estate financings and other real estate transactions and
investments which may be viewed as adverse to or competitive with the business
of Borrower or its Affiliates.
SECTION 11.21 BROKERS AND FINANCIAL ADVISORS.
Borrower hereby represents that it has dealt with no financial
advisors, brokers, underwriters, placement agents, agents or finders in
connection with the transactions contemplated by this Agreement. Borrower shall
indemnify, defend and hold Lender harmless from and against any and all claims,
liabilities, costs and expenses of any kind (including Lender's attorneys' fees
and expenses) in any way relating to or arising from a claim by any Person that
such Person acted on behalf of Borrower or Lender in connection with the
transactions contemplated herein. The provisions of this Section 11.21 shall
survive the expiration and termination of this Agreement and the payment of the
Debt.
SECTION 11.22 EXCULPATION.
Subject to the qualifications below, Lender shall not enforce
the liability and obligation of Borrower to perform and observe the obligations
contained in the Note, this Agreement, the Mortgage or the other Loan Documents
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by any action or proceeding wherein a money judgment shall be sought against
Borrower, except that Lender may bring a foreclosure action, an action for
specific performance or any other appropriate action or proceeding to enable
Lender to enforce and realize upon its interest under the Note, this Agreement,
the Mortgage and the other Loan Documents, or in the Property, the Rents, or any
other collateral given to Lender pursuant to the Loan Documents; provided,
however, that, except as specifically provided herein, any judgment in any such
action or proceeding shall be enforceable against Borrower only to the extent of
Borrower's interest in the Property, in the Rents, Net Proceeds and in any other
collateral given to Lender, and Lender, by accepting the Note, this Agreement,
the Mortgage and the other Loan Documents, shall not xxx for, seek or demand any
deficiency judgment against Borrower in any such action or proceeding under or
by reason of or under or in connection with the Note, this Agreement, the
Mortgage or the other Loan Documents. The provisions of this Section shall not,
however, (a) constitute a waiver, release or impairment of any obligation
evidenced or secured by any of the Loan Documents; (b) impair the right of
Lender to name Borrower as a party defendant in any action or suit for
foreclosure and sale under the Mortgage; (c) affect the validity or
enforceability of any guaranty made in connection with the Loan or any of the
rights and remedies of Lender thereunder; (d) impair the right of Lender to
obtain the appointment of a receiver; (e) impair the enforcement of the
Assignment of Leases; (f) constitute a prohibition against Lender to seek a
deficiency judgment against Borrower in order to fully realize the security
granted by the Mortgage or to commence any other appropriate action or
proceeding in order for Lender to exercise its remedies against the Property; or
(g) constitute a waiver of the right of Lender to enforce the liability and
obligation of Borrower, by money judgment or otherwise, to the extent of any
loss, damage, cost, expense, liability, claim or other obligation incurred by
Lender (including attorneys' fees and costs reasonably incurred) arising out of
or in connection with and Borrower shall be personally liable for the following:
(i) fraud or intentional misrepresentation by Borrower or any
guarantor in connection with the Loan;
(ii) the willful misconduct of Borrower;
(iii) the breach of any representation, warranty, covenant or
indemnification provision in the Environmental Indemnity or in the
Mortgage concerning environmental laws, hazardous substances and
asbestos and any indemnification of Lender with respect thereto in
either document;
(iv) the removal or disposal of any portion of the Property
after an Event of Default;
(v) the misapplication or conversion by Borrower of (A) any
insurance proceeds paid by reason of any loss, damage or destruction to
the Property, (B) any Awards or other amounts received in connection
with the Condemnation of all or a portion of the Property, or (C) any
Rents following an Event of Default or any Rents collected for more
than one month in advance to the extent such Rents or any other
payments in respect of the Leases and other income of the Property or
any other collateral are not applied to the costs of maintenance and
operation of the Property and to the payment of taxes, lien claims,
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insurance premiums, Debt Service and other amounts due under the Loan
Documents;
(vi) misappropriation or conversion of any security deposits,
advance deposits or any other deposits collected with respect to the
Property which are not delivered to Lender upon a foreclosure of the
Property or action in lieu thereof, except to the extent any such
security deposits were applied in accordance with the terms and
conditions of any of the Leases prior to the occurrence of the Event of
Default that gave rise to such foreclosure or action in lieu thereof;
(vii) Borrower's failure to maintain insurance as required by
this Agreement or to pay any taxes or assessments affecting the
Property as required by this Agreement;
(viii) misappropriation, removal or disposal (except in the
ordinary course of Borrower's business) of any Personal Property (as
defined in the Mortgage) affixed to the Property which constitutes a
portion of the collateral for the Loan;
(ix) failure to pay any charges when due for labor or
materials that create Liens on the Property (to the extent net cash
flow from the Property is available for payment of such charges) unless
the same are being contested in accordance with this Agreement;
(x) failure to restore physical waste of the Property; or
(xi) Borrower fails to appoint a new property manager upon the
request of Lender after an Event of Default, as required by, and in
accordance with the terms and provisions of, this Agreement and the
Mortgage.
Notwithstanding anything to the contrary in this Agreement,
the Note or any of the Loan Documents, (A) Lender shall not be deemed to have
waived any right which Lender may have under Section 506(a), 506(b), 1111(b) or
any other provisions of the Bankruptcy Code to file a claim for the full amount
of the Debt or to require that all collateral shall continue to secure all of
the Debt owing to Lender in accordance with the Loan Documents, and (B) the Debt
shall be fully recourse to Borrower in the event that: (i) Borrower fails to
obtain Lender's prior consent to any subordinate financing or other voluntary
Lien encumbering the Property (other than Permitted Encumbrances); (ii) Borrower
fails to obtain Lender's prior consent to any Prohibited Transfer as required by
the Mortgage or this Agreement; (iii) Borrower files a voluntary petition under
the Bankruptcy Code or any other Federal or state bankruptcy or insolvency law;
(iv) an Affiliate which controls, directly or indirectly, Borrower files, or
joins in the filing of, an involuntary petition against Borrower under the
Bankruptcy Code or any other Federal or state bankruptcy or insolvency law, or
solicits or causes to be solicited petitioning creditors for any involuntary
petition against Borrower from any Person; (v) Borrower files an answer
consenting to or otherwise acquiescing in or joining in any involuntary petition
filed against it, by any other Person under the Bankruptcy Code or any other
Federal or state bankruptcy or insolvency law, or solicits or causes to be
solicited petitioning creditors for any involuntary petition from any Person;
(vi) any Affiliate which controls Borrower consents to or acquiesces in or joins
in an application for the appointment of a custodian, receiver, trustee, or
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examiner for Borrower or any portion of the Property; (vii) Borrower makes an
assignment for the benefit of creditors, or admits, in writing or in any legal
proceeding, its insolvency or inability to pay its debts as they become due; or
(viii) Borrower defaults in the observance or performance of any of its
obligations under Section 3.1.24.
SECTION 11.23 PRIOR AGREEMENTS.
This Agreement and the other Loan Documents contain the entire
agreement of the parties hereto and thereto in respect of the transactions
contemplated hereby and thereby, and all prior agreements among or between such
parties, whether oral or written, including, without limitation, the term sheet
dated September 30, 2004 between Borrower and Lender, are superseded by the
terms of this Agreement and the other Loan Documents.
SECTION 11.24 SERVICER.
(a) At the option of Lender, the Loan may be serviced by a
servicer (the "SERVICER") selected by Lender and Lender may delegate all or any
portion of its responsibilities under this Agreement and the other Loan
Documents to the Servicer pursuant to a servicing agreement (the "SERVICING
AGREEMENT") between Lender and Servicer. Borrower shall be responsible for any
reasonable set-up fees or any other initial costs relating to or arising under
the Servicing Agreement; provided, however, that Borrower shall not be
responsible for payment of the monthly servicing fee due to the Servicer under
the Servicing Agreement. Servicer shall, however, be entitled to reimbursement
of costs and expenses as and to the same extent (but without duplication) as
Lender is entitled thereto under the applicable provisions of this Agreement and
the other Loan Documents.
(b) Upon notice thereof from Lender, Servicer shall have the
right to exercise all rights of Lender and enforce all obligations of Borrower
pursuant to the provisions of this Agreement, the Note and the other Loan
Documents.
(c) Provided Borrower shall have been given notice of
Servicer's address by Lender, Borrower shall deliver to Servicer duplicate
originals of all notices and other instruments which Borrower may or shall be
required to deliver to Lender pursuant to this Agreement, the Note and the other
Loan Documents (and no delivery of such notices or other instruments by Borrower
shall be of any force or effect unless delivered to Lender and Servicer as
provided above).
SECTION 11.25 JOINT AND SEVERAL LIABILITY.
If more than one Person has executed this Agreement as
"Borrower," the representations, covenants, warranties and obligations of all
such Persons hereunder shall be joint and several.
SECTION 11.26 CREATION OF SECURITY INTEREST.
Notwithstanding any other provision set forth in this
Agreement, the Note, the Mortgage or any of the other Loan Documents, Lender may
at any time create a security interest in all or any portion of its rights under
this Agreement, the Note, the Mortgage and any other Loan Document (including,
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without limitation, the advances owing to it) in favor of any Federal Reserve
Bank in accordance with Regulation A of the Board of Governors of the Federal
Reserve System.
SECTION 11.27 ASSIGNMENTS AND PARTICIPATIONS.
(a) The Lender may assign to one or more Persons all or a
portion of its rights and obligations under this Loan Agreement.
(b) Upon such execution and delivery, from and after the
effective date specified in such assignment, the assignee thereunder shall be a
party hereto and have the rights and obligations of Lender hereunder.
(c) Lender may, in connection with any assignment or
participation or proposed assignment or participation pursuant to this Section
11.27, disclose to the assignee or participant or proposed assignee or
participant, as the case may be, any information relating to Borrower or any of
its Affiliates or to any aspect of the Loan that has been furnished to the
Lender by or on behalf of the Borrower or any of its Affiliates.
SECTION 11.28 SET-OFF.
In addition to any rights and remedies of Lender provided by
this Loan Agreement and by law, the Lender shall have the right, without prior
notice to Borrower, any such notice being expressly waived by Borrower to the
extent permitted by applicable law, upon any amount becoming due and payable by
Borrower hereunder (whether at the stated maturity, by acceleration or
otherwise) to set-off and appropriate and apply against such amount any and all
deposits (general or special, time or demand, provisional or final), in any
currency, and any other credits, indebtedness or claims, in any currency, in
each case whether direct or indirect, absolute or contingent, matured or
unmatured, at any time held or owing by Lender or any Affiliate thereof to or
for the credit or the account of Borrower. Lender agrees promptly to notify
Borrower after any such set-off and application made by Lender; provided that
the failure to give such notice shall not affect the validity of such set-off
and application.
SECTION 11.29 COMPONENT NOTES.
Lender, without in any way limiting Lender's other rights
hereunder, in its sole and absolute discretion, shall have the right at any time
to require Borrower to execute and deliver "component" notes (including senior
and junior notes) in replacement of the Note as evidence of the Loan, which
notes may be paid in such order of priority as may be designated by Lender,
provided that (i) the aggregate principal amount of such "component" notes shall
equal the outstanding principal balance of the Loan, (ii) the weighted average
interest rate of all such "component" notes shall on the date created equal the
interest rate which was applicable to the Loan, (iii) the Debt Service on all
such "component" notes shall on the date created equal the Debt Service which
was due under the Loan immediately prior to the creation of such component notes
and (iv) the other terms and provisions of each of the "component" notes shall
be identical in substance and substantially similar in form to the Loan
Documents. Borrower, at its cost and expense, shall cooperate with all
reasonable requests of Lender in order to establish the "component" notes and
shall execute and deliver such documents as shall reasonably be required by
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Lender and any Rating Agency in connection therewith, all in form and substance
reasonably satisfactory to Lender and satisfactory to any Rating Agency,
including, without limitation, the severance of security documents if requested.
In the event Borrower fails to execute and deliver such documents to Lender
within five (5) Business Days following such request by Lender, Borrower hereby
absolutely and irrevocably appoints Lender as its true and lawful attorney,
coupled with an interest, in its name and stead to make and execute all
documents necessary or desirable to effect such transactions, Borrower ratifying
all that such attorney shall do by virtue thereof subject to the limitations set
forth in this Section 11.29.
It shall be an Event of Default under this Agreement, the
Note, the Mortgage and the other Loan Documents if Borrower fails to comply with
any of the terms, covenants or conditions of this Section 11.29 within ten (10)
Business Days of notice thereof.
All legal fees and expenses incurred by Borrower in connection
with this Section 11.29 (including costs and expenses incurred by Borrower
pursuant to any requests made by Lender under Section 11.29) shall be paid by
Borrower except Borrower's legal fees.
SECTION 11.30 APPROVALS; THIRD PARTIES; CONDITIONS.
All approval rights retained or exercised by Lender with
respect to Leases, contracts, plans, studies and other matters are solely to
facilitate Lender's credit underwriting, and shall not be deemed or construed as
a determination that Lender has passed on the adequacy thereof for any other
purpose and may not be relied upon by Borrower or any other Person. This
Agreement is for the sole and exclusive use of Lender and Borrower and may not
be enforced, nor relied upon, by any Person other than Lender and Borrower. All
conditions of the obligations of Lender hereunder, including the obligation to
make advances, if any, are imposed solely and exclusively for the benefit of
Lender, its successors and assigns, and no other Person shall have standing to
require satisfaction of such conditions or be entitled to assume that Lender
will refuse to make advances in the absence of strict compliance with any or all
of such conditions, and no other Person shall, under any circumstances, be
deemed to be a beneficiary of such conditions, any and all of which may be
freely waived in whole or in part by Lender at any time in Lender's sole
discretion. SECTION
11.31 LIMITATION ON LIABILITY OF LENDER'S OFFICERS, EMPLOYEES,
ETC.
Any obligation or liability whatsoever of Lender which may
arise at any time under this Agreement or any other Loan Document shall be
satisfied, if at all, out of Lender's interest in the Property only. No such
obligation or liability shall be personally binding upon, nor shall resort for
the enforcement thereof be had to, the property of any of Lender's shareholders,
directors, officers, employees or agents, regardless of whether such obligation
or liability is in the nature of contract, tort or otherwise.
[NO FURTHER TEXT ON THIS PAGE]
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IN WITNESS WHEREOF, the parties hereto have caused this Loan
Agreement to be duly executed by their duly authorized representatives, all as
of the day and year first above written.
LENDER:
EUROHYPO AG, NEW YORK BRANCH, the
New York branch of a German
banking corporation
By:_____________________________
Name:
Title:
By:_____________________________
Name:
Title:
BORROWER:
CEDAR-FRANKLIN VILLAGE LLC,
a Delaware limited liability company
By: ____________________________________
Name: Xxxxxx X. Xxxxxx
Title: Vice President
SCHEDULE I
----------
(RENT ROLL)
Schedule I
SCHEDULE II
-----------
(REQUIRED REPAIRS)
PROPERTY REQUIRED REPAIR AMOUNT DEADLINE
---------------------- ----------------------------------- -------- --------
Pavement Repairs Parking area cracks require repairs $3,500 1 year
Masonry Repairs Repair masonry control joints $2,500 1 year
Window Repairs Re-caulk storefront windows $2,500 1 year
Roof Repairs Investigate and repair roof $2,500 1 year
Sprinkler Head Repairs Resolve sprinkler head deficiencies $7,250 1 year
per Massachusetts code
Exposure Protection Add Applebee Tenant sprinkler heads $4,500 1 year
Standpipe Separation Separate standpipe hose valves from $13,000 1 year
sprinkler system in Buildings J and
1100
Exterior Alarms Add exterior audible alarms $3,200 1 year
Control Valves Add sprinkler control valves $2,000 1 year
Fire Pump Bearings Add fire pump bearing $500 1 year
Electrical Panel Infrared scan and maintain electric $3,000 1 year
panels
Electric Code Violation An electrical should verify the fire $1,500 1 year
pump feeder is not tapped
Schedule II
SCHEDULE III
------------
(ORGANIZATIONAL CHART)
Schedule III
SCHEDULE IV
-----------
EUROHYPO AG, NEW YORK BRANCH
(Lender)
- and -
----------------------------
(Tenant)
SUBORDINATION, NON-DISTURBANCE
AND ATTORNMENT AGREEMENT
Dated:
Location:
Section:
Block:
Lot:
County:
PREPARED BY AND UPON
RECORDATION RETURN TO:
Cadwalader, Xxxxxxxxxx & Xxxx LLP
000 Xxxxxx Xxxx
Xxx Xxxx, Xxx Xxxx 000000
Attention: Xxxxxxx X. Xxxxxxxxx, Esq.
Facsimile No.: (000) 000-0000
File No.:
Title No.:
Schedule IV- Page 9
SUBORDINATION, NON DISTURBANCE AND ATTORNMENT AGREEMENT
THIS SUBORDINATION, NON DISTURBANCE AND ATTORNMENT AGREEMENT
(this "AGREEMENT") is made as of the ____ day of _______________, 20__ by and
between EUROHYPO AG, NEW YORK BRANCH, the New York branch of a German banking
corporation, having an address at 1114 Avenue of the Americas, Xxxxxx-Xxxxx
Xxxxx, Xxx Xxxx, Xxx Xxxx 00000 ("LENDER"), and
____________________________________ ____________, having an address at
________________________________________________ ("TENANT").
RECITALS:
A. Lender has made a loan in the approximate amount of
$_______ to Landlord (defined below), which Loan is given pursuant to the terms
and conditions of that certain Loan Agreement dated ________________, 20__,
between Lender and Landlord (the "LOAN AGREEMENT"). The Loan is evidenced by a
certain Promissory Note dated ________________, 20__, given by Landlord to
Lender (the "NOTE") and secured by a certain [Mortgage][Deed of Trust] and
Security Agreement dated ______________, 20__, given by Landlord to Lender (the
"MORTGAGE"), which encumbers the fee estate of Landlord in certain premises
described in Exhibit A attached hereto (the "PROPERTY");
B. Tenant occupies a portion of the Property under and
pursuant to the provisions of a certain lease dated _________________, ____
between _________________, as landlord ("LANDLORD") and Tenant, as tenant (the
"LEASE"); and
C. Tenant has agreed to subordinate the Lease to the
Mortgage and to the lien thereof and Lender has agreed to grant non-disturbance
to Tenant under the Lease on the terms and conditions hereinafter set forth.
AGREEMENT:
For good and valuable consideration, Tenant and Lender agree
as follows:
1. Subordination. Tenant agrees that the Lease and all of the
terms, covenants and provisions thereof and all rights, remedies and options of
Tenant thereunder are and shall at all times continue to be subject and
subordinate in all respects to the Mortgage and to the lien thereof and all
terms, covenants and conditions set forth in the Mortgage and the Loan Agreement
including without limitation all renewals, increases, modifications, spreaders,
consolidations, replacements and extensions thereof and to all sums secured
thereby with the same force and effect as if the Mortgage and Loan Agreement had
been executed, delivered and (in the case of the Mortgage) recorded prior to the
execution and delivery of the Lease.
2. Non-Disturbance. Lender agrees that if any action or
proceeding is commenced by Lender for the foreclosure of the Mortgage or the
sale of the Property, Tenant shall not be named as a party therein unless such
joinder shall be required by law, provided, however, such joinder shall not
result in the termination of the Lease or disturb the Tenant's possession or use
Schedule IV-Page 2
of the premises demised thereunder, and the sale of the Property in any such
action or proceeding and the exercise by Lender of any of its other rights under
the Note, the Mortgage and the Loan Agreement shall be made subject to all
rights of Tenant under the Lease, provided that at the time of the commencement
of any such action or proceeding or at the time of any such sale or exercise of
any such other rights (a) the term of the Lease shall have commenced pursuant to
the provisions thereof, (b) Tenant shall be in possession of the premises
demised under the Lease, (c) the Lease shall be in full force and effect and (d)
Tenant shall not be in default under any of the terms, covenants or conditions
of the Lease or of this Agreement on Tenant's part to be observed or performed
beyond the expiration of any applicable notice or grace periods.
3. Attornment. Lender and Tenant agree that upon the
conveyance of the Property by reason of the foreclosure of the Mortgage or the
acceptance of a deed or assignment in lieu of foreclosure or otherwise, the
Lease shall not be terminated or affected thereby (at the option of the
transferee of the Property (the "TRANSFEREE") if the conditions set forth in
Section 2 above have not been met at the time of such transfer) but shall
continue in full force and effect as a direct lease between the Transferee and
Tenant upon all of the terms, covenants and conditions set forth in the Lease
and in that event, Tenant agrees to attorn to the Transferee and the Transferee
shall accept such attornment, provided, however, that the provisions of the
Mortgage and the Loan Agreement shall govern with respect to the disposition of
any casualty insurance proceeds or condemnation awards and the Transferee shall
not be (a) obligated to complete any construction work required to be done by
Landlord pursuant to the provisions of the Lease or to reimburse Tenant for any
construction work done by Tenant, (b) liable (i) for Landlord's failure to
perform any of its obligations under the Lease which have accrued prior to the
date on which the Transferee shall become the owner of the Property, or (ii) for
any act or omission of Landlord, whether prior to or after such foreclosure or
sale, (c) required to make any repairs to the Property or to the premises
demised under the Lease required as a result of fire, or other casualty or by
reason of condemnation unless the Transferee shall be obligated under the Lease
to make such repairs and shall have received sufficient casualty insurance
proceeds or condemnation awards to finance the completion of such repairs, (d)
required to make any capital improvements to the Property or to the premises
demised under the Lease which Landlord may have agreed to make, but had not
completed, or to perform or provide any services not related to possession or
quiet enjoyment of the premises demised under the Lease, (e) subject to any
offsets, defenses, abatements or counterclaims which shall have accrued to
Tenant against Landlord prior to the date upon which the Transferee shall become
the owner of the Property, (f) liable for the return of rental security
deposits, if any, paid by Tenant to Landlord in accordance with the Lease unless
such sums are actually received by the Transferee, (g) bound by any payment of
rents, additional rents or other sums which Tenant may have paid more than one
(1) month in advance to any prior Landlord unless (i) such sums are actually
received by the Transferee or (ii) such prepayment shall have been expressly
approved of by the Transferee, (h) bound to make any payment to Tenant which was
required under the Lease, or otherwise, to be made prior to the time the
Transferee succeeded to Landlord's interest, (i) bound by any agreement
amending, modifying or terminating the Lease made without the Lender's prior
written consent prior to the time the Transferee succeeded to Landlord's
interest or (j) bound by any assignment of the Lease or sublease of the
Property, or any portion thereof, made prior to the time the Transferee
succeeded to Landlord's interest other than if pursuant to the provisions of the
Lease.
Schedule IV-Page 3
4. Notice to Tenant. After notice is given to Tenant by Lender
that the Landlord is in default under the Note and the Mortgage and that the
rentals under the Lease should be paid to Lender pursuant to the terms of the
assignment of leases and rents executed and delivered by Landlord to Lender in
connection therewith, Tenant shall thereafter pay to Lender or as directed by
the Lender, all rentals and all other monies due or to become due to Landlord
under the Lease and Landlord hereby expressly authorizes Tenant to make such
payments to Lender and hereby releases and discharges Tenant from any liability
to Landlord on account of any such payments.
5. Lender's Consent. Tenant shall not, without obtaining the
prior written consent of Lender, (a) enter into any agreement amending,
modifying or terminating the Lease, (b) prepay any of the rents, additional
rents or other sums due under the Lease for more than one (1) month in advance
of the due dates thereof, (c) voluntarily surrender the premises demised under
the Lease or terminate the Lease without cause or shorten the term thereof, or
(d) assign the Lease or sublet the premises demised under the Lease or any part
thereof other than pursuant to the provisions of the Lease; and any such
amendment, modification, termination, prepayment, voluntary surrender,
assignment or subletting, without Lender's prior consent, shall not be binding
upon Lender.
6. Lender to Receive Notices. Tenant shall provide Lender with
copies of all written notices sent to Landlord pursuant to the Lease
simultaneously with the transmission of such notices to the Landlord. Tenant
shall notify Lender of any default by Landlord under the Lease which would
entitle Tenant to cancel the Lease or to an abatement of the rents, additional
rents or other sums payable thereunder, and agrees that, notwithstanding any
provisions of the Lease to the contrary, no notice of cancellation thereof or of
such an abatement shall be effective unless Lender shall have received notice of
default giving rise to such cancellation or abatement and shall have failed
within sixty (60) days after receipt of such notice to cure such default, or if
such default cannot be cured within sixty (60) days, shall have failed within
sixty (60) days after receipt of such notice to commence and thereafter
diligently pursue any action necessary to cure such default.
7. Notices. All notices or other written communications
hereunder shall be deemed to have been properly given (i) upon delivery, if
delivered in person or by facsimile transmission with receipt acknowledged by
the recipient thereof and confirmed by telephone by sender, (ii) one (1)
Business Day (hereinafter defined) after having been deposited for overnight
delivery with any reputable overnight courier service, or (iii) three (3)
Business Days after having been deposited in any post office or mail depository
regularly maintained by the U.S. Postal Service and sent by registered or
certified mail, postage prepaid, return receipt requested, addressed as follows:
If to Tenant:
_____________________________
_____________________________
_____________________________
Attention: _________________
Facsimile No.: _____________
Schedule IV-Page 4
If to Lender:
Eurohypo AG, New York Branch
1114 Avenue of the Americas
Xxxxxx-Xxxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Head of Portfolio Operations
Facsimile No.: (000) 000-0000
With a copy to:
Eurohypo AG, New York Branch
1114 Avenue of the Americas
Xxxxxx-Xxxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Legal Director
Facsimile No.: (000) 000-0000
With a copy to:
Cadwalader, Xxxxxxxxxx & Xxxx LLP
000 Xxxxxx Xxxx
Xxx Xxxx, Xxx Xxxx 000000
Attention: Xxxxxxx X. Xxxxxxxxx, Esq.
Facsimile No.: (000) 000-0000
or addressed as such party may from time to time designate by written notice to
the other parties. For purposes of this Section, the term "BUSINESS DAY" shall
mean a day on which commercial banks are not authorized or required by law to
close in New York, New York.
Either party by notice to the other may designate additional
or different addresses for subsequent notices or communications.
8. Joint and Several Liability. If Tenant consists of more
than one person, the obligations and liabilities of each such person hereunder
shall be joint and several. This Agreement shall be binding upon and inure to
the benefit of Lender and Tenant and their respective successors and assigns.
9. Definitions. The term "LENDER" as used herein shall include
the successors and assigns of Lender and any person, party or entity which shall
become the owner of the Property by reason of a foreclosure of the Mortgage or
the acceptance of a deed or assignment in lieu of foreclosure or otherwise. The
term "LANDLORD" as used herein shall mean and include the present landlord under
the Lease and such landlord's predecessors and successors in interest under the
Lease, but shall not mean or include Lender. The term "PROPERTY" as used herein
shall mean the Property, the improvements now or hereafter located thereon and
the estates therein encumbered by the Mortgage.
Schedule IV-Page 5
10. No Oral Modifications. This Agreement may not be modified
in any manner or terminated except by an instrument in writing executed by the
parties hereto.
11. Governing Law. This Agreement shall be deemed to be a
contract entered into pursuant to the laws of the State where the Property is
located and shall in all respects be governed, construed, applied and enforced
in accordance with the laws of the State where the Property is located.
12. Inapplicable Provisions. If any term, covenant or
condition of this Agreement is held to be invalid, illegal or unenforceable in
any respect, this Agreement shall be construed without such provision.
13. Duplicate Originals; Counterparts. This Agreement may be
executed in any number of duplicate originals and each duplicate original shall
be deemed to be an original. This Agreement may be executed in several
counterparts, each of which counterparts shall be deemed an original instrument
and all of which together shall constitute a single Agreement. The failure of
any party hereto to execute this Agreement, or any counterpart hereof, shall not
relieve the other signatories from their obligations hereunder.
14. Number and Gender. Whenever the context may require, any
pronouns used herein shall include the corresponding masculine, feminine or
neuter forms, and the singular form of nouns and pronouns shall include the
plural and vice versa.
15. Transfer of Loan. Lender may sell, transfer and deliver
the Note and assign the Mortgage, this Agreement and the other documents
executed in connection therewith to one or more investors in the secondary
mortgage market ("INVESTORS"). In connection with such sale, Lender may retain
or assign responsibility for servicing the loan, including the Note, the
Mortgage, this Agreement and the other documents executed in connection
therewith, or may delegate some or all of such responsibility and/or obligations
to a servicer including, but not limited to, any subservicer or master servicer,
on behalf of the Investors. All references to Lender herein shall refer to and
include any such servicer to the extent applicable.
16. Further Acts. Tenant will, at the cost of Tenant, and
without expense to Lender, do, execute, acknowledge and deliver all and every
such further acts and assurances as Lender shall, from time to time, require,
for the better assuring and confirming unto Lender the property and rights
hereby intended now or hereafter so to be, or for carrying out the intention or
facilitating the performance of the terms of this Agreement or for filing,
registering or recording this Agreement, or for complying with all applicable
laws.
17. Limitations on Lender's Liability. Tenant acknowledges
that Lender is obligated only to Landlord to make the Loan upon the terms and
subject to the conditions set forth in the Loan Agreement. In no event shall
Lender or any purchaser of the Property at foreclosure sale or any grantee of
the Property named in a deed-in-lieu of foreclosure, nor any heir, legal
representative, successor, or assignee of Lender or any such purchaser or
grantee (collectively the Lender, such purchaser, grantee, heir, legal
representative, successor or assignee, the "SUBSEQUENT LANDLORD") have any
personal liability for the obligations of Landlord under the Lease and should
the Subsequent Landlord succeed to the interests of the Landlord under the
Schedule IV-Page 6
Lease, Tenant shall look only to the estate and property of any such Subsequent
Landlord in the Property for the satisfaction of Tenant's remedies for the
collection of a judgment (or other judicial process) requiring the payment of
money in the event of any default by any Subsequent Landlord as landlord under
the Lease, and no other property or assets of any Subsequent Landlord shall be
subject to levy, execution or other enforcement procedure for the satisfaction
of Tenant's remedies under or with respect to the Lease; provided, however, that
the Tenant may exercise any other right or remedy provided thereby or by law in
the event of any failure by Subsequent Landlord to perform any such material
obligation.
Schedule IV-Page 7
IN WITNESS WHEREOF, Lender and Tenant have duly executed this
Agreement as of the date first above written.
LENDER:
EUROHYPO AG, NEW YORK BRANCH, the
New York branch of a German
banking corporation
By:_____________________________
Name:
Title:
By:_____________________________
Name:
Title:
TENANT:
_________________________________
a _________________
By:_____________________________
Name:
Title:
The undersigned accepts and agrees to
the provisions of Section 4 hereof:
LANDLORD:
______________________, a
____________________________
Schedule IV-Page 8
By:________________________________
Name:
Title:
Schedule IV-Page 9
ACKNOWLEDGMENTS
[INSERT STATE SPECIFIC ACKNOWLEDGMENT]
Schedule IV-Page 10
EXHIBIT A
LEGAL DESCRIPTION
Schedule IV-Page 11
SCHEDULE V
(DESCRIPTION OF REA)
INTENTIONALLY DELETED
Schedule. V
SCHEDULE VI
(DESCRIPTION/DIAGRAM OF RELEASE PARCEL)
Schedule. V
