EXHIBIT XXV
AMENDED AND RESTATED
LIMITED RECOURSE GUARANTY [LAKE XXXXXX]
THIS AMENDED AND RESTATED LIMITED RECOURSE GUARANTY (this "Guaranty")
is made as of the 30th day of April, 2001, by Prime Group II, L.P., an Illinois
limited partnership ("PG II"), The Prime Group, Inc., an Illinois corporation
("Prime" PG II and Prime are sometimes hereinafter referred to individually as
"Guarantor" or together as "Guarantors") in favor of Xxxxxx Investors Life
Insurance Company, an Illinois insurance corporation ("Lender").
RECITALS:
WHEREAS, PG II executed and delivered to Lender a certain Limited
Recourse Guaranty [Lake Xxxxxx] dated March 22, 1994, as amended from time to
time (the "Original PG II Guaranty") in favor of Lender guaranteeing a loan
described therein arising out of credit enhancement extended by Lender and its
Affiliates;
WHEREAS, Prime executed and delivered to Lender a certain Limited
Recourse Guaranty [Lake Xxxxxx] dated August 31, 1994, as amended from time to
time (the "Original Prime Guaranty") in favor of Lender guaranteeing a loan
described therein arising out of credit enhancement extended by Lender and its
Affiliates;
WHEREAS, each of the Original PG II Guaranty and Original Prime
Guaranty were secured by a Pledge and Security Agreement [Lake Xxxxxx] between
PG II and Prime, respectively, and Lender, as amended from time to time (the
"Original Pledge Agreements");
WHEREAS, certain defaults currently exist under one of the Original
Pledge Agreements;
WHEREAS, as a material inducement to Lender to waive such defaults and
in order to reflect other transactions which have occurred since the Original PG
II Guaranty and the Original Prime Guaranty and restate the rights and
obligations of the parties thereunder, Guarantors have agreed to execute and
deliver this Guaranty on the terms hereinafter set forth; and
WHEREAS, Guarantors and Lender are entering into a certain Amended and
Restated Pledge and Security Agreement [Lake Xxxxxx] of even date herewith (as
amended from time to time, the "Pledge and Security Agreement") as security for
their liabilities and obligations under this Guaranty and in order to fully
amend and restate the rights and obligations of the parties under the Original
Pledge Agreements.
NOW, THEREFORE, in consideration of the foregoing premises, and for
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged,
1
Guarantors hereby agree that the Original PG II Guaranty and Original Prime
Guaranty are hereby amended and restated in their entirety to read as follows:
1. GUARANTY.
(a) Guarantors hereby absolutely and unconditionally guarantee the
punctual payment when due, whether at stated maturity, by acceleration or
otherwise, without set-off, counterclaim or other reduction whatsoever, of (i)
the aggregate outstanding unpaid principal amount of the Loan (hereinafter
defined), (ii) all accrued and unpaid interest on the principal amount of the
Loan, and (iii) all other amounts due under the Loan from time to time or under
any documents and instruments executed and delivered or assigned to Lender in
order to evidence or secure the Loan or evidence or perfect a lien or security
interest in collateral for the Loan (the "Collateral Documents"), and any and
all extensions, renewals or modifications of any of the foregoing (such
principal, interest and other amounts are hereinafter referred to collectively
as the "Obligations"). In addition, if Guarantors shall fail to pay any amount
due hereunder upon demand in accordance with the terms hereof Guarantors shall
pay any and all fees, costs and expenses (including reasonable attorneys' fees)
incurred by Lender to third parties, whether litigation is involved or not, and
if involved, whether at the trial or appellate levels or in pre- or
post-judgment or bankruptcy proceedings, in enforcing the obligations of
Guarantors hereunder or realizing upon any collateral securing this Guaranty
(all of the foregoing fees, costs and expenses are referred to herein
collectively as the "Guaranteed Expenses"). The Obligations and any instrument,
document or agreement, express or implied, which has been or may hereafter be
made or entered into by Guarantors, Borrower (hereinafter defined) or any other
person or entity in reference to the Obligations (including, without limitation,
the Collateral Documents and the Pledge Agreement, as hereinafter defined) shall
all be hereinafter collectively referred to as the "Terms".
(b) For purposes hereof, the following terms shall have the following
respective meanings:
"ADA Agreement" shall have the meaning given in the Standby Agreement.
"Affiliate" means, as to any Person, any other Person that directly or
indirectly controls, or is under common control with, or is controlled by, such
Person. As used in this definition, "control" (including, with its correlative
meanings, "controlled by" and "under common control with") means possession,
directly or indirectly, of power to direct or cause the direction of management
or policies (whether through ownership of securities or partnership or other
ownership interests, by contract or otherwise).
"Alternate Security" shall have the meaning given in the Standby
Agreement.
"Bonds" shall mean the Health Facilities Development Revenue Bonds (The
Island on Lake Xxxxxx, Ltd. Project) Series 1986, in the aggregate principal
amount of $25,000,000 issued by the Capital Health Facilities Development
Corporation, a Texas public non-profit corporation.
"Borrower" shall mean The Island on Lake Xxxxxx, Ltd., a Texas limited
partnership.
2
"Business Day" shall mean any day of the week other than Saturday,
Sunday or any other day on which banks are generally closed within the City of
Chicago, Illinois.
"Entity' means any general partnership, limited partnership,
corporation, joint venture, trust, business trust, limited liability company,
corporation or association.
"Environmental Agreement" shall have the meaning given in the Standby
Agreement.
"Loan" means (i) any and all liabilities and obligations of Borrower
arising under the Reimbursement Agreement, and any and all documents and
instruments evidencing or securing the liabilities and obligations under the
Reimbursement Agreement, or any renewal, extension or refinancing thereof, (ii)
any and all liabilities and obligations of Borrower arising under the Standby
Agreement, the ADA Agreement or the Environmental Agreement, or (iii) any other
liabilities or obligations of Borrower or any Guarantor to Lender or an
Affiliate of Lender arising in connection with any credit support or enhancement
extended by Lender or any Affiliate of Lender with respect to the Bonds.
"Person" means any individual or Entity.
"Reimbursement Agreement" means (i) that certain Reimbursement
Agreement dated November 1, 1994 among Credit Suisse First Boston (formerly
Credit Suisse), Lender, Federal Xxxxxx Life Assurance Company and Borrower, as
heretofore or hereafter amended, or any other reimbursement or similar agreement
entered into by Borrower in connection with the securing of Alternate Security
for the Bonds or the purchase of the Bonds by Lender or an Affiliate of Lender.
"Standby Agreement" means that certain Standby Bond Purchase and
Indemnity Agreement between Lender and Borrower dated December 1, 1994 and
effective as of March 22, 1994.
2. LIMITED RECOURSE. Notwithstanding anything to the contrary contained
herein or in the Pledge Agreement, except as otherwise provided in this
Section 2, neither any Guarantor nor any of its shareholders, officers,
directors, partners, employees, agents or other representatives ("Other
Persons") shall have any personal liability for the Obligations or the
Guaranteed Expenses under this Guaranty, or for the obligation to observe,
perform or discharge any of the terms, covenants or conditions contained herein
or in the Pledge Agreement, and, except as otherwise provided in this Section 2,
(a) no attachment, execution, writ or other process shall be sought and no
judicial proceeding shall be initiated by or on behalf of Lender against any
Guarantor or any Other Person as a result of a breach or default under this
Guaranty or the Pledge Agreement, except to the extent that such attachment,
execution, writ or judicial proceeding shall be necessary to enforce any of the
rights, remedies or recourses of Lender against or with reference to the
Collateral (as defined in the Pledge Agreement), and (b) in the event that any
suit is brought hereunder or under the Pledge Agreement, any judgment obtained
in or as a result of such suit shall be enforceable and/or enforced solely
against the Collateral; PROVIDED, HOWEVER, that nothing herein contained shall
be construed to: (i) be a release or impairment of any Guarantor's obligations
hereunder or under the Pledge Agreement, (ii) prevent Lender from exercising and
enforcing, consistent with the provisions of this Section 2,
3
any other remedy allowed at law or in equity or by statute or by the terms
hereof or the Pledge Agreement or (iii) prevent Lender from recovering from any
Guarantor (or any such Other Person), or limit Lender's recourse against any
Guarantor (or any such Other Person) for, any funds, damages or costs
(including, without limitation, reasonable legal expenses) incurred by Lender as
a result of any willful act or omission in bad faith, any fraudulent act or
omission or any breach of any of the following sections of the Pledge Agreement:
the first sentence of Section 4.2, Section 4.3(a), Section 4.4, Section 4.5 and
Section 4.7(ii). Nothing in this Paragraph 2 shall be deemed to increase the
liability of any such Other Person beyond that which any such Other Person may
have under the partnership agreement of Guarantor or under law.
3. GUARANTY ABSOLUTE. Guarantors guarantee that the Obligations and the
Guaranteed Expenses will be paid in accordance with the terms and provisions of
this Guaranty and, to the maximum extent permitted by law, Guarantors waive any
law, regulation, order or judgment now or hereafter in effect in any
jurisdiction affecting the obligations of Guarantors or the rights of Lender
with respect thereto. This Guaranty, and the liability of Guarantors under this
Guaranty (which liability is subject to Section 2 hereof), shall continue and be
absolute and unconditional and remain in full force and effect irrespective of:
(a) any lack of validity or enforceability of any of the Terms;
(b) any change in the time, manner or place of payment of, or in any
other term, including the applicable rate of interest, of, all or any of the
Terms, or any other renewal, extension, amendment, modification or waiver of or
any consent to departure from any of the Terms;
(c) any act or omission of Lender (or other holder of the Collateral
Documents) of any nature whatsoever;
(d) with respect to any Guarantor, Borrower or any other person or
entity, (i) any failure to obtain required authorization by all necessary
corporate, partnership or other action relating to the incurrence of the
Obligations or to the execution, delivery or performance of any of the Terms, or
(ii) any violation of any provision of any of the articles of incorporation,
by-laws, partnership agreement or any other document, instrument or agreement
occasioned by the incurrence of the Terms, by the execution, delivery, or
performance of any of the Terms, or by any failure of same to have been duly
authorized by all necessary corporate or other action;
(e) any amendment, waiver, modification, extension or renewal of or
consent to departure from or forbearance of any other action or inaction under
or in respect of this Guaranty or any other of the Terms;
(f) any exchange, release, forbearance or surrender of or any other
action or inaction with respect to any collateral (including, without
limitation, the Collateral other than a release of all of the Collateral, which
results in a termination of this Guaranty under Section 7(a) below) at any time
and from time to time now or hereafter securing any or all of the Obligations or
Terms or the liability of any Guarantor, Borrower or any other person or entity
in respect of all or any of the Terms or any failure to perfect or continue as
perfected any security interest or other lien with respect to any such
collateral, or any loss or destruction of any such collateral, or
4
any matter impairing the value of such collateral as security for all or any of
the Terms, the liability of any Guarantor, Borrower or any other person or
entity, in respect of all or any of the Obligations or Terms;
(g) any other guaranty now or hereafter executed by any Guarantor or
anyone else or any recovery under any such other guaranty;
(h) any waiver of or assertion or enforcement or failure or refusal
to assert or enforce, in whole or in part, any of the terms and provisions of
the Terms, or any claim, cause of action, right or remedy which Lender may, at
any time, have under this Guaranty, the Pledge Agreement or any of the other
Collateral Documents or with respect to any guaranty or any security which may
be held by Lender (or other holder of the Collateral Documents) with respect to
the Loan;
(i) the failure to give any Guarantor any notice whatsoever, other
than any notice which Lender is expressly required to give pursuant to any
provisions of this Guaranty;
(j) exculpatory provisions in any of the Collateral Documents limiting
Lender's recourse to property encumbered by the Loan Documents or to any other
security or limiting Lender's rights to enforce a deficiency judgment against
Borrower;
(k) any sale, assignment, conveyance, merger or other transfer,
voluntary or involuntary (whether by operation of law or otherwise), of all or
any part of Borrower's interest in any property securing the Loan or the
occurrence of any such sale, assignment, conveyance, merger or other voluntary
or involuntary transfer which results in any Guarantor becoming the Borrower
under the Collateral Documents, provided, however, that any such sale,
assignment, conveyance, merger or other transfer shall be subject to the
limitations set forth in the Collateral Documents,
(l) any sale, assignment,, [sic] conveyance, merger or other transfer,
voluntary or involuntary (whether by operation of law or otherwise), of all or
any part of the interest of Lender (or other holder of the Collateral Documents)
in the Collateral Documents or this Guaranty;
(m) any failure to properly record or file any of the Collateral
Documents, or to otherwise perfect, protect, secure or insure any security
interest or lien given as security for the Loan;
(n) any recovery as a result of the exercise by Lender (or other holder
of the Collateral Documents) of any of its rights or remedies under the
Collateral Documents, including any foreclosure thereof; or
(o) any other fact, circumstance or matter of any nature whatsoever
that might otherwise constitute a defense available to, or a discharge of, or
might otherwise operate to release or affect the obligations of any Guarantor,
Borrower or any other person or entity liable to Lender (or other holder of the
Collateral Documents) in respect of any of the Terms.
5
This Guaranty shall continue to be effective or shall be reinstated, as the case
may be, regardless of whether any payment of any of the Obligations or the
Guaranteed Expenses is rescinded or must otherwise be returned by Lender upon
the insolvency, bankruptcy, or reorganization of any Guarantor, Borrower, or any
other person or entity or for any reason whatsoever, all as though such payment
had not been made. Lender shall not be required to contest, dispute or litigate
its obligation to make such payment or repayment. The obligations of each
Guarantor hereunder shall be absolute and primary, shall be complete and binding
as to such Guarantor upon its execution of this Guaranty, shall be subject to no
conditions precedent, and shall be independent of and cumulative to any other of
the Terms, and Lender may exercise any of its rights and remedies under this
Guaranty, any other of the Terms or otherwise singly or concurrently. The
obligations of any Guarantor under this Guaranty shall not be reduced, limited,
impaired, discharged, deferred, suspended or terminated by any voluntary or
involuntary bankruptcy, insolvency, receivership, reorganization, liquidation,
arrangement, or debtor-relief proceeding of or against Borrower, or by any
defense that Borrower may have by reason of the existence of any such proceeding
or any order, decree or decision of any court or administrative body resulting
from or relating to any such proceeding.
4. WAIVER; NO DUTIES. Guarantors waive to the fullest extent permitted by
applicable law; (a) all statutes of limitations as a defense to any action
brought against any Guarantor by Lender; (b), any defense based upon any legal
disability or any discharge or limitation of liability (except as provided in
Section 2 above), whether consensual or arising by operation of law or any
bankruptcy, insolvency or debtor-relief proceeding, or from any other cause; (c)
promptness, diligence, presentment, demand, protest and notice of any kind
(other than as expressly required herein), (d) any defense based upon or arising
out of any defense of Borrower to the payment or performance of any part of the
Obligations (other than payment); (e) any and all rights of indemnity,
contribution, reimbursement or any similar right that any Guarantor may have
against Borrower as a result of any actions taken or amounts paid in connection
with or relating to this Guaranty or the Loan; (f) all rights of subrogation,
including, without limitation, all rights to enforce any remedy of Lender, and
all right to participate in any security held by Lender; (g) notice of any
change in Borrower's financial condition; (h) the right to interpose any
substantive or procedural defense of the law of guaranty, indemnification or
suretyship (except the defense of prior payment of all of the Obligations and
Guaranteed Expenses which any Guarantor is called upon to pay under this
Guaranty); (i) all rights and remedies accorded by applicable law to guarantors
or sureties, including without limitation, any extension of time conferred by
any law now or hereafter in effect; (j) the right to interpose any defense
(except as allowed under clause (h) above), set-off or counterclaim of any
nature or description in any action or proceeding; and (k) any right or claim of
right to cause a marshalling of Borrower's assets or to cause Lender to proceed
against Borrower and/or any collateral held by Lender at any time or in any
particular order. Lender shall not be obligated to exhaust any right or take any
action against the Borrower or any other person or entity or any collateral for
the Obligations prior to the enforcement of its rights hereunder. Nothing in
this Paragraph 4 shall be construed as a waiver by any Guarantor or an Affiliate
of any Guarantor of any right to receive any distributions to which it might be
entitled under the partnership agreement of Borrower.
5. NOTICES. Any notice or other communication required or permitted
hereunder shall be (a) in writing and shall be deemed to have been duly given
(A) when received, if delivered in
6
person, (B) five (5) days after deposit in a regularly maintained receptacle of
the United States mail as registered or certified mail, first class postage
prepaid, (C) the business day after notice is sent for overnight delivery by
nationally recognized overnight courier service, or (D) on the day on which the
party to whom such notice is addressed refuses delivery by mail or by nationally
recognized courier service, and (b) addressed as follows:
To Lender: c/o ZKS Real Estate Partners, LLC
000 Xxxx Xxxxx
Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
Attn: Xxxx X. Xxxxxxx
With copies to: Zurich Xxxxxx Life Companies
0000 Xxxxxxxx Xxxx
Tower 0, 00xx Xxxxx
Xxxxxxxxxx, XX 00000
Attn: Xxxx Xxxxxxx
To Guarantor: c/o The Prime Group, Inc.
00 Xxxx Xxxxxx Xxxxx
Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxxxxx X. Xxxxxxx
With a copy to: The Prime Group, Inc, [sic]
00 Xxxx Xxxxxx Xxxxx
Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxxxx X. Xxxxxx
or to any such other address as any party hereto shall designate in a written
notice to the other parties hereto.
6. NO WAIVER: CUMULATIVE REMEDIES. Lender may, at any time and from time to
time, waive or not insist on strict compliance with any one or more of the
provisions contained in any document relating to this Guaranty, but any such
waiver or non-insistence shall be deemed to be made pursuant to the terms of
said document and not in modification thereof. Any waiver or non-insistence in
any instance or under any particular circumstance shall not be considered a
waiver or non-insistence of such provision in any other instance or any other
circumstance. The remedies provided herein and in the other documents executed
contemporaneously herewith and referred to herein shall be cumulative, may be
exercised from time to time, singularly or concurrently or in any combination,
without Lender being obligated to exercise any such right in any other
circumstance, and, subject to Section 2 above, are not exclusive of any remedies
provided by law.
7
7. CONTINUING GUARANTY; TRANSFER. This Guaranty is a continuing guaranty
and shall:
(a) remain in full force and effect until (i) all of the Obligations
and Guaranteed Expenses have been paid in full, or all of the Collateral (as
such term is defined in the Pledge Agreement) securing this Guaranty has been
applied toward the Obligations and Guaranteed Expenses and (ii) any and all
amounts due or claims made under clause (iii) of Section 2 of this Guaranty have
been paid, satisfied or otherwise disposed of, as applicable, at which time this
Guaranty shall terminate (and Lender shall at such time, upon the request and at
the expense of any Guarantor, acknowledge the release and termination of this
Guaranty);
(b) be binding upon each Guarantor, and its heirs, administrators,
executors, successors and assigns, who shall be jointly and severally liable
hereunder in accordance with the terms hereof; provided, however, no Guarantor
may assign any of its rights and obligations hereunder without the prior written
consent of Lender; and
(c) inure to the benefit of and be binding on and enforceable by Lender
and its successors, transferees, participants, and assigns. Without limiting the
generality of this clause, Lender may assign or otherwise transfer any of the
Obligations and/or any of the Terms to any other person or entity, and such
other person or entity shall thereupon become vested with all the rights in
respect thereof granted to Lender herein or otherwise.
8. GOVERNING LAW; SUBMISSION TO JURISDICTION. This Guaranty shall be
governed by, and construed in accordance with, the laws of the State of Illinois
without regard to principles of conflict of laws. Each of Lender and each
Guarantor hereby waives any plea of jurisdiction or venue as not being a
resident of Xxxx County, Illinois and hereby specifically authorizes any action
brought by the other upon or with regard to this Guaranty to be instituted and
prosecuted in either the Circuit Court of Xxxx County, Illinois or in the United
States District Court for the Northern District of Illinois, at the election of
the party bringing the action. Each of Lender and each Guarantor hereby
irrevocably authorizes service of process to be made upon it in the manner
specified in Section 5 above, in any action which may be instituted against it
arising out of or relating to this Guaranty.
9. HEADINGS. Section headings in this Guaranty are included herein for
convenience of reference only and shall not constitute a part of this Guaranty
for any other purpose.
10. WAIVER OF JURY TRIAL. EACH OF LENDER AND EACH GUARANTOR WAIVES, TO THE
FULLEST EXTENT PERMITTED BY LAW, THE RIGHT TO TRIAL BY JURY IN ANY ACTION,
PROCEEDING OR COUNTERCLAIM FILED BY ANY PARTY, RELATING DIRECTLY OR INDIRECTLY
TO THIS GUARANTY, THE PLEDGE AGREEMENT OR THE OBLIGATIONS GUARANTEED HEREBY.
11. ESTOPPEL. Each Guarantor shall, at any time and from time to time,
within ten (10) Business Days following request by Lender, execute, acknowledge
and deliver to Lender a statement certifying that this Guaranty is unmodified
and in full force and effect (or if there have been modifications, that the same
is in full force and effect as modified and stating such
8
modifications) and that, to the best of Guarantor's knowledge, Guarantor is not
in default hereunder (or if there is such a default, describing such default in
reasonable detail).
12. SEVERABILITY. The unenforceability or invalidity of any provision or
provisions of this Guaranty shall not render any other provision or provisions
herein contained unenforceable or invalid.
13. NON-ASSERTION. Lender covenants that it shall not assert in any
judicial or other case or proceeding that that certain Release of Guaranties and
Other Obligations and Covenant Not to Xxx, dated March 22, 1994, made by Lender
and certain affiliates of Lender in favor of Guarantor and others, is not valid,
enforceable and effective.
14. JOINT AND SEVERAL. The covenants, agreements and guaranties of each or
both of the Guarantors under this Guaranty shall constitute joint and several
obligations of the Guarantors.
15. SUPERCEDE. This Guaranty restates and supercedes the Original PG II
Guaranty and the Original Prime Guaranty.
[Signature Page Follows]
9
IN WITNESS WHEREOF, Guarantors have caused this Guaranty to be executed
and delivered on the date and year first above written.
THE PRIME GROUP, INC., PRIME GROUP II, L.P. an Illinois limited
an Illinois corporation partnership
By: /S/ XXXX X. XXXXXX By: PGLP, Inc., an Illinois corporation, its
------------------------------ general partner
Name: XXXX X. XXXXXX
-----------------------------
Title: SENIOR VICE PRESIDENT
-----------------------------
By: /S/ XXXX X. XXXXXX
---------------------------------
Name: XXXX X. XXXXXX
---------------------------------
Title: VICE PRESIDENT
---------------------------------
ACKNOWLEDGED:
XXXXXX INVESTORS LIFE INSURANCE
COMPANY, an Illinois insurance corporation
By: /S/ XXXX X. XXXXXXX
------------------------------
Name: XXXX X. XXXXXXX
------------------------------
Title: AUTHORIZED SIGNATORY
------------------------------
By: /S/ XXXXXXXXX X. XXXXXXXX
------------------------------
Name: XXXXXXXXX X. XXXXXXXX
------------------------------
Title: AUTHORIZED SIGNATORY
------------------------------
10
