Exhibit 4.1
INTERCREDITOR AND COLLATERAL AGENCY AGREEMENT
This Intercreditor Agreement (this "Agreement"), dated as of April 17,
2001, is among XXXXXXX XXXXX INTERNATIONAL, ACTING THROUGH ITS AGENT, XXXXXXX
LYNCH, PIERCE, XXXXXX & XXXXX INCORPORATED, in its capacity as "Buyer" (in such
capacity, the "Repo Purchaser") under the Repo Agreement (as hereinafter
defined), XXXXX FARGO BANK MINNESOTA, NATIONAL ASSOCIATION, in its capacity as
Trustee (in such capacity the "Note A Indenture Trustee") under that certain
Indenture dated as of April 17, 2001, between CRIIMI MAE Inc. and the Note A
Indenture Trustee for the benefit of the holders of the 11.75% Series A Senior
Secured Notes due 2006 (the "Series A Notes"), XXXXX FARGO BANK MINNESOTA,
NATIONAL ASSOCIATION, in its capacity as Trustee (in such capacity the "Note B
Indenture Trustee", and together with the Note A Indenture Trustee, the
"Indenture Trustees") under that certain Indenture dated as of April 17, 2001,
between CRIIMI MAE Inc. and the Note B Indenture Trustee for the benefit of the
holders of the 20% Series B Senior Secured Notes due 2007 (the "Series B Notes",
and together with the Series A Notes, the "Notes"), and XXXXXXX LYNCH, PIERCE,
XXXXXX & XXXXX INCORPORATED, in its capacity as "Collateral Agent" (in such
capacity, the "Collateral Agent") under the Security Documents (as hereinafter
defined).
RECITALS
WHEREAS, on October 5, 1998, CRIIMI MAE Inc. ("CMI"), CRIIMI MAE
Management, Inc. ("CMM") and CRIIMI MAE Holdings II, L.P. ("Holdings" and,
together with CMI and CMM, the "Debtors") filed voluntary petitions for relief
under Chapter 11 of title 11 of the United States Code (the "Bankruptcy Code").
WHEREAS, the Debtors filed Debtors' Third Amended Joint Plan of
Reorganization dated July 21, 2000 (the "July 21st Plan") and Debtors' Second
Amended Joint Disclosure Statement dated August 24, 2000 (the "Disclosure
Statement") with the United States Bankruptcy Court, District of Maryland,
Greenbelt Division (the "Bankruptcy Court"). The Bankruptcy Court approved the
adequacy of the Disclosure Statement, and thereafter the July 21st Plan and the
Disclosure Statement were distributed, with the requisite ballots, to the
holders of all claims and interests impaired and entitled to vote under the
Plan, in order to solicit their acceptance of the Plan.
WHEREAS, a hearing (the "Confirmation Hearing") was held before the
Bankruptcy Court on November 15, 2000 (the "Confirmation Date").
WHEREAS, the July 21st Plan was amended at the Confirmation Hearing, and
the July 21st Plan as so amended (the "Plan") was confirmed by the Bankruptcy
Court pursuant to its Order dated November 22, 2000 (the "Confirmation Order").
WHEREAS, the Plan, as confirmed by the Confirmation Order, provides that
Xxxxxxx Xxxxx Mortgage Capital Inc. ("MLMCI") and German American Capital
Corporation ("GACC") are to receive, on the effective date of the Plan (the
"Effective Date") (i) in immediately available funds (a) $100 million on account
of the principal
amount of their aggregate claims against CMI, and (b) any accrued and
unpaid interest (calculated at the contract non-default rate) owing to MLMCI and
GACC in respect of such claims as of the date immediately preceding the
Effective Date (the aggregate of all such principal claims of MLMCI and GACC
against CMI and all such accrued and unpaid interest owing in respect of such
principal claims as of the date immediately preceding the Effective Date is
hereinafter referred to as the "MLMCI/GACC Claim"), (ii) any reasonable legal
fees and expenses (not to exceed $500,000) incurred by MLMCI and GACC in
connection with the drafting, negotiating and finalizing of the Repo Documents
(as hereinafter defined) and (iii) new obligations under the Repo Documents in
an original amount equal to the amount by which (a) the aggregate outstanding
principal amount of the indebtedness owed by CMI to MLMCI and GACC, as of the
Effective Date, exceeds (b) $100 million.
WHEREAS, as of the Effective Date, MLMCI and GACC have, directly or
indirectly, transferred, conveyed and assigned all of their respective right,
title and interest in and to the MLMCI/GACC Claim, to the extent not previously
paid by CMI to MLMCI and/or GACC (the "Remaining MLMCI/GACC Claim") to the Repo
Purchaser, and the Repo Purchaser has assigned the Remaining MLMCI/GACC Claim to
CMI as consideration for the purchase by the Repo Purchaser of the CBO REIT
Stock Collateral pursuant to the terms and conditions of the Repo Agreement (as
hereinafter defined).
WHEREAS, the Plan, as confirmed by the Confirmation Order, provides that
the Class A9 and Class A10 (as defined in the Plan) unsecured creditors of CMI
("Unsecured Creditors"), on account of both old senior note claims and general
Class A10 unsecured claims, are to receive on the Effective Date $75 million in
immediately available funds on account of all allowed claims in the Class A10
Convenience Class (as provided in the Plan) and in reduction, pari passu, of the
allowed claims of the remaining Unsecured Creditors against CMI, which allowed
claims shall include prepetition and postpetition interest as set forth in the
Plan. The remaining balance owing to the Unsecured Creditors is referred to as
"New Debt". The New Debt is represented by the Series A Notes, in the aggregate
amount of $105 million, and the Series B Notes, in the aggregate amount of the
balance of the New Debt. The principal amount of the New Debt represented by the
Notes may change from time to time as provided for in the Notes and the Note A
Indenture and the Note B Indenture.
WHEREAS, pursuant to the Plan, as confirmed by the Confirmation Order;
(i) CMI has formed a limited purpose, bankruptcy remote captive REIT ("CBO
REIT").
(ii) (a) CMI has confirmed or is confirming the existing first-priority
security interests of MLMCI and GACC in the Current CBO-2 Collateral (as
hereinafter defined) and the Proceeds (as hereinafter defined) thereof, and
MLMCI and GACC have assigned or are assigning such first-priority security
interests to the Repo Purchaser to secure the Repo Obligations (as hereinafter
defined), and (b) CMI has granted or is granting the Repo Purchaser a
first-priority security interest in the Collection Account (as hereinafter
defined) as additional collateral security for the Repo Obligations.
(iii) (a) CMI has granted or is granting the Note A Indenture Trustee a
second-priority security interest, and the Note B Indenture Trustee a
third-priority security interest, in the Current CBO-2 Collateral and the
Proceeds thereof, and (b) CMI has granted or is granting the Note A Indenture
Trustee a second priority security interest and the Note B Indenture Trustee a
third-priority security interest in the Collection Account, as additional
collateral security for the Series A Notes and the Series B Notes, respectively.
(iv) CMI has contributed or is contributing the Current CBO-2 Collateral to
CBO REIT subject to the first-priority security interest in favor of the Repo
Purchaser, the second-priority security interest in favor of the Note A
Indenture Trustee and the third-priority security interest in favor of the Note
B Indenture Trustee in the Current CBO-2 Collateral and the Proceeds thereof,
whether or not such Proceeds are held in the Collection Account.
(v) CMI (a) has granted or is granting the Repo Purchaser a first-priority
security interest in all of the issued and outstanding capital stock of CMBS
Corp. (collectively, the "CMBS Corp. Stock"), and the Proceeds thereof, whether
or not such Proceeds are held in the Collection Account, as additional
collateral security for the Repo Obligations, and (b) has granted or is granting
the Note A Indenture Trustee a second-priority security interest, and the Note B
Indenture Trustee a third-priority security interest, in the CMBS Corp. Stock
and the Proceeds thereof, whether or not such Proceeds are held in the
Collection Account, as additional collateral security for the Series A Notes and
the Series B Notes, respectively.
(vi) CMI has contributed or is contributing the CMBS Corp. Stock to CBO
REIT, subject to the first-priority security interest in favor of the Repo
Purchaser, the second-priority security interest in favor of the Note A
Indenture Trustee and the third-priority security interest in favor of the Note
B Indenture Trustee in the CMBS Corp. Stock and the Proceeds thereof, whether or
not such Proceeds are held in the Collection Account. From and after the date of
such transfer CMBS Corp. shall be a direct wholly-owned subsidiary of CBO REIT.
(vii) CMI (a) has granted or is granting the Note A Indenture Trustee a
first-priority security interest, and the Note B Indenture Trustee a
second-priority security interest, in the Nomura Bond (as hereinafter defined)
and the Proceeds thereof, whether or not such Proceeds are held in the New Note
Collection Account (as hereinafter defined), as additional collateral security
for the Series A Notes and the Series B Notes, respectively, and (b) has granted
or is granting the Repo Purchaser a third-priority security interest in the
Nomura Bond and the Proceeds thereof, whether or not such Proceeds are held in
the New Note Collection Account, as additional collateral security for the Repo
Obligations.
(viii) CMI has contributed or is contributing the Nomura Bond to CBO REIT,
subject to the first-priority security interest in favor of the Note A Indenture
Trustee, the second-priority security interest in favor of the Note B Indenture
Trustee, and the third-priority security interest in favor of the Repo Purchaser
in the Nomura Bond
and the Proceeds thereof, whether or not such Proceeds are held in the New
Note Collection Account.
(ix) CMI (a) has granted or is granting the Note A Indenture Trustee a
first-priority security interest and the Note B Indenture Trustee a
second-priority security interest, in all of the issued and outstanding capital
stock of QRS 1 (collectively, the "QRS 1 Stock"), and the Proceeds thereof,
whether or not such Proceeds are held in the New Note Collection Account, as
additional collateral security for the Series A Notes and the Series B Notes,
respectively, and (b) has granted or is granting the Repo Purchaser a
third-priority security interest in the QRS 1 Stock and the Proceeds thereof,
whether or not such Proceeds are held in the New Note Collection Account, as
additional collateral security for the Repo Obligations.
(x) CMI has contributed or is contributing all of the QRS 1 Stock to CBO
REIT, subject to the first-priority security interest in favor of the Note A
Indenture Trustee, the second-priority security interest in favor of the Note B
Indenture Trustee, and the third-priority security interest in favor of the Repo
Purchaser in the QRS 1 Stock and the Proceeds thereof, whether or not such
Proceeds are held in the New Note Collection Account. From and after the date of
such transfer, QRS 1 shall be a direct wholly-owned subsidiary of CBO REIT.
(xi) (a) CMI has granted or is granting the Note A Indenture Trustee a
first-priority security interest, and the Note B Indenture Trustee a
second-priority security interest, in the New Note Collection Account, as
additional collateral security for the Series A Notes and the Series B Notes,
respectively, and (b) CMI has granted or is granting the Repo Purchaser a
third-priority security interest in the New Note Collection Account, as
additional collateral security for the Repo Obligations.
(xii) CMI has granted or is granting the Note A Indenture Trustee a
first-priority security interest and the Note B Indenture Trustee a
second-priority security interest in all of the issued and outstanding capital
stock of CBO REIT held by CMI (collectively the "CBO REIT Stock Collateral") and
the Proceeds thereof, (which will be deemed to include any amounts paid or
payable by the Repo Purchaser to CMI pursuant to the Repo Agreement), as
additional collateral security for the Series A Notes and the Series B Notes,
respectively.
(xiii) Pursuant to the Repo Agreement, CMI has sold or is selling all of
the CBO REIT Stock Collateral to the Repo Purchaser, subject to the security
interests in favor of the Note A Indenture Trustee and the Note B Indenture
Trustee, respectively. The consummation of such sale has occurred or will occur
immediately subsequent to the completion of the transfers described in Sections
(iv),(vi),(viii) and (x) above.
(xiv) The Repo Agreement entitles and obligates CMI to repurchase the CBO
REIT Stock Collateral from the Repo Purchaser at the "Repurchase Price"
specified in the Repo Agreement (the "Repurchase Price") and otherwise upon and
subject to the terms and conditions specified in the Repo Agreement (including a
customary "backstop security interest" provision).
(xv) CBO REIT has reaffirmed or is reaffirming the security interests
granted by CMI in each of the Current CBO-2 Collateral and the CMBS Corp. Stock,
and the respective Proceeds thereof, whether or not held in the Collection
Account.
(xvi) CBO REIT has reaffirmed or is reaffirming the security interests
granted by CMI in each of the Nomura Bond and the QRS 1 Stock, and the
respective Proceeds thereof, whether or not held in the New Note Collection
Account.
WHEREAS, the parties are willing to accept and permit the respective liens
and security interests, and the transactions contemplated by the Repo Agreement,
as set forth above, and the relative priorities noted with respect thereto, in
order to effectuate the terms and conditions of the Plan, subject to the
parties' agreements regarding such liens, security interests and priorities and
the respective rights and remedies of the parties in connection with the CBO-2
Collateral (as hereinafter defined), the CBO REIT Stock Collateral and the
CBO-1/Nomura Collateral (as hereinafter defined), all as more specifically set
forth herein.
NOW, THEREFORE, in consideration of the premises and the mutual covenants
and agreements herein contained, the parties hereto hereby agree as follows:
ARTICLE I
DEFINITIONS
The parties agree that the following capitalized terms used in this
Agreement without definition shall have the respective meanings assigned to such
terms below:
(a) Accounts: The Collection Account and the New Note Collection Account,
collectively.
(b) Arm's-Length Sale: Any sale of the CBO-2 Collateral, the Combined
Collateral or the CBO REIT Stock Collateral, as applicable, in a bona fide,
arm's-length transaction to a third party buyer not affiliated with the Debtors
or the Repo Purchaser.
(c) Bid Packages: As defined in Article VI, Section (e) hereof.
(d) Business Day: Any day other than a Saturday, a Sunday, or a day when
the New York Stock Exchange is closed.
(e) CBO REIT Stock Collateral: As defined in the Recitals to this
Agreement.
(f) CBO REIT Stock Collateral Proceeds: As defined in Article VI, Section
(c)(i) hereof.
(g) CBO-1/Nomura Collateral: Collectively, the Nomura Bond and the QRS 1
Stock.
(h) CBO-1/Nomura Collateral Proceeds: As defined in Article VI, Section
(c)(iv)(A) hereof.
(i) CBO-2 Collateral: Collectively, the Current CBO-2 Collateral and the
CMBS Corp. Stock.
(j) CBO-2 Collateral Proceeds: As defined in Article VI, Section (c)(iv)
(A) hereof.
(k) CBO-2 Sale Proceeds: As defined in Article VI, Section (b)(i) hereof.
(l) CMBS Appraiser: As defined in Article VI, Section (c)(iv)(B)(2)
hereof.
(m) CMBS Corp.: CRIIMI MAE CMBS Corp., the Delaware corporation that owns
the Incremental CBO-2 Collateral.
(n) CMBS Corp. Stock: As defined in the Recitals to this Agreement.
(o) Collateral Account: As defined in Article III, Section (d).
(p) Collateral Agent: Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated,
as collateral agent for the benefit of the Repo Purchaser, the Note A Indenture
Trustee and the Note B Indenture Trustee.
(q) Collection Account: A deposit account in the name of CMI and pledged to
and under the sole dominion and control of the Collateral Agent for the benefit
of the Repo Purchaser, the Note A Indenture Trustee, and the Note B Indenture
Trustee, as their respective interests may appear, as set forth herein and in
the Repo Agreement, the Note A Indenture, the Note B Indenture and the Security
Agreement.
(r) Combined Collateral: Collectively, the CBO-2 Collateral and the
CBO-1/Nomura Collateral.
(s) Combined Collateral Proceeds: As defined in Article VI, Section (c)(i)
hereof.
(t) Current CBO-2 Collateral: Collectively, CMM 1998-C1, Bond Classes X0,
X0, X, X, X, X0, X0 and J.
(u) Debtors: As defined in the Recitals to this Agreement.
(v) Deemed Sale: Any sale of the CBO-2 Collateral, the Combined Collateral
or the CBO REIT Stock Collateral, as applicable, to the Repo Purchaser, MLMCI,
GACC, the Indenture Trustees (except to the extent either or both of the
Indenture Trustees elect not to participate in the Deemed Sale of the CBO-2
Collateral
pursuant to Article VII, Section (b)(ii)(A) hereof) or any of their
respective affiliates, as acquirors thereof, by and through a Deemed Sale
Entity.
(w) Deemed Sale Collateral: As defined in Article VI, Section (d) hereof.
(x) Deemed Sale Entity: Either (x) a securities account with the Collateral
Agent held for the benefit of the Repo Purchaser, the Note A Indenture Trustee
and the Note B Indenture Trustee, or (y) at the election of the Repo Purchaser,
a real estate investment trust, limited liability company, partnership,
corporation or other legal entity formed by the Repo Purchaser and reasonably
satisfactory to the Note A Indenture Trustee and the Note B Indenture Trustee in
which each of the Repo Purchaser, the Note A Indenture Trustee and the Note B
Indenture Trustee holds a beneficial interest (in either case subject to the
election of either or both of the Indenture Trustees not to participate in the
Deemed Sale of the CBO-2 Collateral pursuant to Article VII, Section (b)(ii)(A)
hereof) to take title to and possession of the CBO-2 Collateral, the Combined
Collateral or the CBO REIT Stock Collateral, as applicable, in connection with
any Deemed Sale of any of such assets, in any such case in a manner consistent
with the respective rights and obligations of such parties relative to such
assets as set forth in this Agreement.
(y) Deemed Sale Period: The period commencing upon the date of the Deemed
Sale of any of the CBO-2 Collateral, the Combined Collateral and the CBO REIT
Stock Collateral, as applicable, and terminating upon the date of completion of
the Arm's Length Sale of such assets, as provided for in this Agreement.
(z) Disposition Default: As defined in the first paragraph of Article VI
hereof.
(aa) Disqualified CMBS Institution: As defined in Article VI, Section (c)
(iv)(B)(1) hereof.
(bb) Distributions: All periodic payments, dividends and cash distributions
made on account of the CBO-2 Collateral, the Combined Collateral or the CBO REIT
Stock Collateral, as applicable.
(cc) Excluded RP Actions: Any of the following actions taken, or proposed
or attempted to be taken, by the Repo Purchaser (or by the Collateral Agent
acting on behalf or for the benefit of the Repo Purchaser): (x) the exercise, or
attempted exercise, of any right or remedy available to the Repo Purchaser (or
to the Collateral Agent acting on behalf or for the benefit of the Repo
Purchaser) with respect to its realization on the CBO-2 Collateral, the Combined
Collateral, the CBO REIT Stock Collateral or the Accounts under the Repo
Agreement, under any Security Document, at law or in equity, upon the occurrence
of a default or event of default under the Repo Agreement or any Security
Document, including, without limitation, any acceleration of the Repurchase Date
(as defined in the Repo Agreement), or the commencement of any judicial action
or proceeding, or the disposition of or other realization upon all or any
portion of the CBO-2 Collateral, the Combined Collateral, the CBO REIT Stock
Collateral or the Accounts (whether by foreclosure, Arm's Length Sale, Deemed
Sale or otherwise); (y) any Arm's Length Sale or other disposition of all or any
portion of the Deemed Sale Collateral by the Repo Purchaser (or the Collateral
Agent acting on behalf or for the benefit of the Repo Purchaser) or the Deemed
Sale Entity, as applicable, at any time following the acquisition of the Deemed
Sale Collateral by the Repo Purchaser (or the Collateral Agent acting on behalf
or for the benefit of the Repo Purchaser) or the Deemed Sale Entity, as the case
may be; and (z) any action (whether taken prior or subsequent to the occurrence
of a default or event of default under the Repo Agreement or under any Security
Document) necessary or appropriate for preserving, protecting or confirming the
Repo Purchaser's title to the CBO REIT Stock Collateral, or the attachment,
perfection or priority of the Collateral Agent's security interest in all or any
portion of the Combined Collateral, the CBO REIT Stock Collateral or the
Accounts.
(dd) Excluded RP Remedies: (a) The accrual of the Price Differential (as
defined in the Repo Agreement, as in effect on the date hereof and without
giving effect to any subsequent amendments) on the Repo Obligations at the
"default rate" provided for in the Repo Agreement, (b) the exercise by the Repo
Purchaser of the right to effect or resume the "cash sweep" provided for in the
Repo Agreement following a monetary default, as provided therein, (c) the
exercise by the Repo Purchaser of voting rights with respect to the CBO REIT
Stock Collateral or any other voting securities pledged as collateral security
for the Repo Obligations, and (d) the exercise by the Repo Purchaser of the
right to appoint and give direction to the Special Servicer incident to any pool
of securities.
(ee) Foreclosure Agreement: As defined in the first paragraph of Article
VII hereof.
(ff) Incremental CBO-2 Collateral: Collectively, CMM 1998-C1, Owner Trust
Certificate and Classes A and R.
(gg) Indenture Trustees' Proceeds Statement: As defined in Article VI,
Section (c)(iv)(A) hereof.
(hh) IT Security Instruments: Collectively, the pledges and other
instruments pursuant to which CMI and CBO REIT grant and reaffirm the respective
security interests of the Note A Indenture Trustee and the Note B Indenture
Trustee in the Combined Collateral and the CBO REIT Stock Collateral, as
collateral security for the Series A Notes and the Series B Notes.
(ii) Minimum CBO-1/Nomura Collateral Value: As defined in Article VI,
Section (d)(ii) hereof.
(jj) Miscellaneous Collateral: Collectively, the Aim Fund Proceeds, the
Insured Mortgage Proceeds, the Interest Strip Certificates, the Mezzanine Notes
and the Mezzanine Notes Collateral, the Partnership Interests and the Collateral
Account, each as defined in the Miscellaneous Collateral Security Agreement.
(kk) Miscellaneous Collateral Agent: As defined in Article III, Section (d)
hereof.
(ll) Miscellaneous Collateral Security Agreement: As defined in Article
II, Section (d) hereof.
(mm) MLMCI/GACC Claim: As defined in the Recitals to this Agreement.
(nn) Net Sale Proceeds: With respect to any Arm's Length Sale of the CBO-2
Collateral, an amount equal to (x) the gross sales proceeds received by the Repo
Purchaser in respect of such Arm's Length Sale, minus (y) the amount owed to the
Repo Purchaser under the Repo Agreement and the RP Security Instruments, and
minus (z) the actual costs of sale in respect of such Arm's-Length Sale.
(oo) Net Worth Certification: As defined in Article V, Section (d)(y).
(pp) New CBO-1 Collateral: Collectively, CMM 1996-C1, Bond Class F and
Owner Trust Certificate Classes P, R and XS.
(qq) New Debt: As defined in the Recitals to this Agreement.
(rr) New Note Collection Account: A deposit account in the name of CMI
pledged to and under the dominion and control of the Collateral Agent for the
benefit of the Note A Indenture Trustee, the Note B Indenture Trustee and the
Repo Purchaser, as their interests may appear, as set forth herein and in the
Note A Indenture, the Note B Indenture, the Repo Agreement and the Security
Agreement.
(ss) Nomura Bond: Nomura Asset Securities Corporation Commercial Mortgage
Pass Through Certificates Series 1998-D6, Class - B7, Cusip No. - 000000XX0 in
the original face amount of $46,532,578.00.
(tt) Note A Indenture: That certain Indenture dated as of the date hereof,
by and between CMI and the Note A Indenture Trustee for the benefit of the
holders of the Series A Notes.
(uu) Note B Indenture: That certain Indenture dated as of the date hereof,
by and between CMI and the Note B Indenture Trustee for the benefit of the
holders of the Series B Notes.
(vv) Note A Indenture Trustee: Xxxxx Fargo Bank Minnesota, National
Association, or any successor thereto, in its capacity as Trustee for the
holders of the Series A Notes under the Note A Indenture.
(ww) Note B Indenture Trustee: Xxxxx Fargo Bank Minnesota, National
Association, or any successor thereto, in its capacity as Trustee for the
holders of the Series B Notes under the Note B Indenture.
(xx) Noteholders: Collectively, the holders of the Series A Notes and the
holders of the Series B Notes.
(yy) Notes: Collectively, the Series A Notes and the Series B Notes.
(zz) Permitted Refinancing: As defined in Article V, Section (d) hereof.
(aaa) Person: Any individual, corporation, partnership, limited liability
company, trust, joint venture, unincorporated association or other enterprise or
any government or agency, instrumentality or political subdivision thereof.
(bbb) Potential Purchaser: As defined in Article VI, Section (d)(i) hereof.
(ccc) Proceeds: As defined in the Security Agreement.
(ddd) QRS 1: CRIIMI MAE QRS 1, Inc., the Delaware corporation that owns the
New CBO-1 Collateral.
(eee) QRS 1 Stock: As defined in the Recitals to this Agreement.
(fff) Qualified CMBS Institution: As defined in Article VI, Section (c)(iv)
(B)(1) hereof.
(ggg) Remaining MLMCI/GACC Claim: As defined in the Recitals to this
Agreement.
(hhh) Repo Agreement: The "master repurchase agreement" (together with all
applicable annexes thereto) dated as of the date hereof, between CMI, as seller,
and the Repo Purchaser, as buyer.
(iii) Repo Disposition: As defined in Article VII hereof.
(jjj) Repo Documents: Collectively, the Repo Agreement and the RP Security
Instruments.
(kkk) Repo Obligations: Collectively, (i) the obligation of CMI under the
Repo Agreement to pay the Repurchase Price in the amount and at the time or
times specified under the Repo Agreement, (ii) all other obligations to be paid
or performed by CMI under the Repo Agreement, and (iii) all obligations required
to be paid or performed by the pledgor(s) under the RP Security Agreements.
(lll) Repo Purchaser's Proceeds Statement: As defined in Article VI,
Section (c)(iv)(A) hereof.
(mmm) Repurchase Price: As defined in the Recitals to this Agreement.
(nnn) RP Security Instruments: Collectively, the pledge agreements and
other instruments pursuant to which CMI and CBO REIT grant and reaffirm the
security interests of the Repo Purchaser in the Combined Collateral, as
collateral security for the Repo Obligations.
(ooo) Security Agreement: That certain Security and Pledge Agreement dated
as of the date hereof, by CMI in favor of the Collateral Agent for the benefit
of the Repo Purchaser, the Note A Indenture Trustee for the benefit of the
holders of the Series A Notes and the Note B Indenture Trustee for the benefit
of the holders of the Series B Notes, as their respective interests may appear.
For purposes of this Agreement, the Security Agreement shall constitute both an
"IT Security Instrument" and an "RP Security Instrument".
(ppp) Security Documents: Collectively, the IT Security Instruments and the
RP Security Instruments.
(qqq) Series A Notes: The 11.75% Series A Senior Secured Notes due 2006
issued under the Note A Indenture.
(rrr) Series B Notes: The 20% Series B Senior Secured Notes due 2007 issued
under the Note B Indenture.
(sss) Shared Collateral: As defined in Article VI, Section (c)(ii)(B)
hereof.
(ttt) Special Servicer: As defined in Article VIII, Section (a) hereof.
(uuu) Special Servicing Rights: As defined in Article VIII, Section (a)
hereof.
(vvv) Term Sheet: As defined in Article VI, Section (d)(i) hereof.
(www) Term Sheet Response: As defined in Article VI, Section (d)(i) hereof.
ARTICLE II
RECOGNITION OF SECURITY INTERESTS
Each of the Repo Purchaser, the Note A Indenture Trustee and the Note B
Indenture Trustee hereby recognizes and acknowledges the validity, perfection,
priority and enforceability of the respective liens, security interests,
encumbrances and claims granted to the Repo Purchaser and/or the Note A
Indenture Trustee and/or the Note B Indenture Trustee (or to the Collateral
Agent for the benefit of one or more of such parties) pursuant to the Security
Agreement and all filings executed or entered into in connection therewith. Each
of the Repo Purchaser, the Note A Indenture Trustee and the
Note B Indenture Trustee agrees that it will not at any time directly or
indirectly contest in any forum the validity, perfection, priority or
enforceability of any lien, security interest, encumbrance or claim granted to
any other of such parties (or to the Collateral Agent for the benefit of any
other of such parties) in or on the assets of the Debtors, including, without
limitation, the CBO-2 Collateral, the CBO-1/Nomura Collateral and the CBO REIT
Stock Collateral and the Proceeds of each of the foregoing, and each of such
parties hereby agrees not to hinder any other of such parties or take a position
adverse to any other of such parties in the defense of any action contesting the
validity, perfection, priority or enforceability of any such liens, security
interests, encumbrances or claims. Each of the Repo Purchaser, the Note A
Indenture Trustee and the Note B Indenture Trustee further agrees that the
provisions of this Agreement shall remain in full force and effect
notwithstanding a successful challenge to the validity, perfection, priority or
enforceability of all or any of the obligations of CMI owing to MLMCI, GACC, the
Repo Purchaser, the Note A Indenture Trustee or the Note B Indenture Trustee, or
any of the holders of the Series A Notes or the Series B Notes on account of the
Repo Obligations or the New Debt or the liens and security interests securing
same.
ARTICLE III
SUBORDINATION
(a) Irrespective of the time, order or method of attachment or perfection
of security interests or the time or order of filing or recording of financing
statements or other liens, mortgages or security interests, and irrespective of
anything in any filing or agreement (other than this Agreement) to which the
Collateral Agent, the Repo Purchaser, the Note A Indenture Trustee or the Note B
Indenture Trustee may now or hereafter be a party, or any provision of law to
the contrary, any liens or security interests in favor of the Repo Purchaser (or
in favor of the Collateral Agent, for the benefit of the Repo Purchaser) in any
of (i) the Current CBO-2 Collateral and all Proceeds thereof, (ii) the CMBS
Corp. Stock and all Proceeds thereof, and (iii) the Collection Account have and
shall have priority to the extent of the Repo Obligations from time to time
outstanding over any liens or security interests in favor of the Note A
Indenture Trustee or the Note B Indenture Trustee (or in favor of the Collateral
Agent for the benefit of the Note A Indenture Trustee or the Note B Indenture
Trustee) in any or all of such Current CBO-2 Collateral and all Proceeds
thereof, the CMBS Corp. Stock and all Proceeds thereof, and the Collection
Account. That is, the liens or security interests in favor of the Note A
Indenture Trustee and the Note B Indenture Trustee (or in favor of the
Collateral Agent for the benefit of the Note A Indenture Trustee and the Note B
Indenture Trustee) in any and all of the Current CBO-2 Collateral and all
Proceeds thereof, the CMBS Corp Stock and all Proceeds thereof, and the
Collection Account, are and shall be subject and expressly subordinate in all
respects to such liens or security interests in favor of the Repo Purchaser (or
in favor of the Collateral Agent for the benefit of the Repo Purchaser) in any
and all of the Current CBO-2 Collateral and all Proceeds thereof, the CMBS Corp.
Stock and all Proceeds thereof, and the Collection Account.
(b) Irrespective of the time, order or method of attachment or perfection
of security interests or the time or order of filing or recording of financing
statements or
other liens, mortgages or security interests, and irrespective of anything
in any filing or agreement (other than this Agreement) to which the Collateral
Agent, the Repo Purchaser, the Note A Indenture Trustee or the Note B Indenture
Trustee may now or hereafter be a party, or any provision of law to the
contrary, any liens or security interests in favor of the Note A Indenture
Trustee or the Note B Indenture Trustee (or in favor of the Collateral Agent for
the benefit of the Note A Indenture Trustee or the Note B Indenture Trustee) in
any of (i) the Nomura Bond and all Proceeds thereof, (ii) the QRS 1 Stock and
all Proceeds thereof, and (iii) the New Note Collection Account have and shall
have priority to the extent of the aggregate amounts from time to time owing
under the Note A Indenture and the Note B Indenture over any liens or security
interests in favor of the Repo Purchaser (or in favor of the Collateral Agent
for the benefit of the Repo Purchaser) in any or all of the Nomura Bond and all
Proceeds thereof, the QRS 1 Stock and all Proceeds thereof, and the New Note
Collection Account. That is, the liens and security interests in favor of the
Repo Purchaser (or in favor of the Collateral Agent for the benefit of the Repo
Purchaser) in any and all of the Nomura Bond and all Proceeds thereof, the QRS 1
Stock and all Proceeds thereof, and the New Note Collection Account, are and
shall be subject and expressly subordinate in all respects to such liens and
security interests in favor of the Note A Indenture Trustee and the Note B
Indenture Trustee (or in favor of the Collateral Agent for the benefit of the
Note A Indenture Trustee and the Note B Indenture Trustee) in any and all of the
Nomura Bond and all Proceeds thereof, the QRS 1 Stock and all Proceeds thereof
and the New Note Collection Account.
(c) Irrespective of the time, order or method of attachment or perfection
of security interests or the time or order of filing or recording of financing
statements or other liens, mortgages or security interests, and irrespective of
anything in any filing or agreement (other than this Agreement) to which the
Collateral Agent, the Repo Purchaser, the Note A Indenture Trustee or the Note B
Indenture Trustee may now or hereafter be a party, or any provision of law to
the contrary:
(i) the ownership interest of the Repo Purchaser in the CBO REIT Stock
Collateral acquired pursuant to the Repo Agreement and any liens or security
interests (including any "backstop security interest") in favor of the Repo
Purchaser (or in favor of the Collateral Agent for the benefit of the Repo
Purchaser) in the CBO REIT Stock Collateral and all Proceeds thereof do not and
shall not have priority, except as otherwise expressly provided in subparagraph
(c) (iii) below, over any liens or security interests in favor of the Note A
Indenture Trustee or the Note B Indenture Trustee (or in favor of the Collateral
Agent for the benefit of the Note A Indenture Trustee or the Note B Indenture
Trustee) in the CBO REIT Stock Collateral and all Proceeds thereof, nor shall
any of the liens or security interests in favor of the Note A Indenture Trustee
or the Note B Indenture Trustee (or in favor of the Collateral Agent for the
benefit of the Note A Indenture Trustee or the Note B Indenture Trustee) in the
CBO REIT Stock Collateral and all Proceeds thereof be subject to or subordinate
in any respect, except as otherwise expressly provided in subparagraph (c)(iii)
below, to such ownership interest of the Repo Purchaser in the CBO REIT Stock
Collateral or to any of such liens or security interests in favor of the Repo
Purchaser (or in favor of the Collateral Agent for the benefit of the Repo
Purchaser) in the CBO REIT Stock Collateral and all Proceeds thereof;
(ii) the liens and security interests in favor of the Note A Indenture
Trustee or the Note B Indenture Trustee (or in favor of the Collateral Agent for
the benefit of the Note A Indenture Trustee or the Note B Indenture Trustee) in
the CBO REIT Stock Collateral and all Proceeds thereof do not and shall not have
priority, except as otherwise expressly provided in subparagraph (c)(iii) below,
over the ownership interest of the Repo Purchaser in the CBO REIT Stock
Collateral acquired pursuant to the Repo Agreement or any liens or security
interests (including any "backstop security interest") in favor of the Repo
Purchaser (or in favor of the Collateral Agent for the benefit of the Repo
Purchaser) in the CBO REIT Stock Collateral and all Proceeds thereof, nor shall
such ownership interest of the Repo Purchaser in the CBO REIT Stock Collateral
or any of such liens or security interests in favor of the Repo Purchaser (or in
favor of the Collateral Agent for the benefit of the Repo Purchaser) in the CBO
REIT Stock Collateral and all Proceeds thereof be subject or subordinate in any
respect, except as otherwise expressly provided in subparagraph (c)(iii) below,
to any of the liens or security interests in favor of the Note A Indenture
Trustee or the Note B Indenture Trustee (or in favor of the Collateral Agent for
the benefit of the Note A Indenture Trustee or the Note B Indenture Trustee) in
the CBO REIT Stock Collateral and all Proceeds thereof; and
(iii) notwithstanding anything in subparagraph (c)(i) or (c)(ii) to the
contrary, (A) the liens and security interests in favor of the Note A Indenture
Trustee and the Note B Indenture Trustee (or in favor of the Collateral Agent
for the benefit of the Note A Indenture Trustee or the Note B Indenture Trustee)
in the Proceeds of the CBO REIT Stock Collateral shall be subject and
subordinate in all respects to the ownership interest of the Repo Purchaser in
such Proceeds, and the liens and security interests (including any "backstop
security interest") in favor of the Repo Purchaser (or in favor of the
Collateral Agent for the benefit of the Repo Purchaser) in such Proceeds, to the
extent (but only to the extent) of Proceeds of the CBO REIT Stock Collateral
attributable to the Current CBO-2 Collateral and, the CMBS Corp. Stock owned by
CBO REIT and the assets owned by CMBS Corp., and (B) the ownership interest of
the Repo Purchaser in the Proceeds of the CBO REIT Stock Collateral, and the
liens and security interests (including any "backstop security interest") in
favor of the Repo Purchaser (or in favor of the Collateral Agent for the benefit
of the Repo Purchaser) in such Proceeds, shall be subject and subordinate in all
respects to the liens and security interests in favor of the Note A Indenture
Trustee or the Note B Indenture Trustee (or in favor of the Collateral Agent for
the benefit of the Note A Indenture Trustee or the Note B Indenture Trustee) in
such Proceeds, to the extent (but only to the extent) of Proceeds of the CBO
REIT Stock Collateral attributable to the CBO-1/Nomura Collateral owned by CBO
REIT (including the assets owned by QRS 1).
(d) Notwithstanding anything in this Agreement, the Security Agreement,
that certain Security, Pledge and Collateral Assignment Agreement dated as of
even date herewith among CMI, CMM and XX Xxxxxxx Building Inc., Xxxxx Fargo Bank
Minnesota, National Association, as collateral agent (in such capacity the
"Miscellaneous Collateral Agent") on behalf of the Indenture Trustees (the
"Miscellaneous Collateral Security Agreement"), the IT Security Instruments or
otherwise to the contrary, any liens or security interests granted by the
Security Agreement, the Miscellaneous Collateral
Security Agreement, the IT Security Instruments or otherwise in favor of
the Note A Indenture Trustee (or in favor of the Collateral Agent or the
Miscellaneous Collateral Agent for the benefit of the Note A Indenture Trustee)
in any of (i) the Current CBO-2 Collateral and all Proceeds thereof, (ii) the
CMBS Corp. Stock and all Proceeds thereof, (iii) the CBO REIT Stock Collateral
and all Proceeds thereof, (iv) the Nomura Bond and all Proceeds thereof, (v) the
QRS 1 Stock and all Proceeds thereof, (vi) the Miscellaneous Collateral and all
Proceeds thereof, (vii) the Collection Account, (viii) the New Note Collection
Account and (ix) the "Collateral Account" (as defined in the Miscellaneous
Collateral Security Agreement) have and shall have, irrespective of the time,
order or method of attachment or perfection of security interests or the time or
order of filing or recording of financing statements or other liens, mortgages
or security interests, and irrespective of anything in any filing or agreement
(other than this Agreement) to which the Collateral Agent, the Note A Indenture
Trustee or the Note B Indenture Trustee may now or hereafter be a party, or any
provision of law to the contrary, priority to the extent of the aggregate
outstanding obligations under the Note A Indenture from time to time outstanding
over any liens or security interests in favor of the Note B Indenture Trustee
(or in favor of the Collateral Agent or the Miscellaneous Collateral Agent for
the benefit of the Note B Indenture Trustee) in any or all of the Current CBO-2
Collateral, the CMBS Corp. Stock, the CBO REIT Stock Collateral, the Nomura
Bond, the QRS 1 Stock, the Miscellaneous Collateral and all Proceeds of the
foregoing, and the Collection Account, the New Note Collection Account and the
Collateral Account. That is, the liens and security interests in favor of the
Note B Indenture Trustee (or in favor of the Collateral Agent or the
Miscellaneous Collateral Agent for the benefit of the Note B Indenture Trustee)
in any and all of the Current CBO-2 Collateral, the CMBS Corp. Stock, the CBO
REIT Stock Collateral, the Nomura Bond, the QRS 1 Stock, the Miscellaneous
Collateral and all Proceeds thereof, and the Collection Account, the New Note
Collection Account and the Collateral Account, are and shall be subject and
expressly subordinate in all respects to such liens and security interests in
favor of the Note A Indenture Trustee (or in favor of the Collateral Agent or
the Miscellaneous Collateral Agent for the benefit of the Note A Indenture
Trustee) in any and all of the Current CBO-2 Collateral, the CMBS Corp. Stock,
the CBO REIT Stock Collateral, the Nomura Bond, the QRS 1 Stock, the
Miscellaneous Collateral and all Proceeds of the foregoing, and the Collection
Account, the New Note Collection Account and the Collateral Account. In addition
to the subordination of liens and security interests in favor of the Note A
Indenture Trustee (or in favor of the Collateral Agent or the Miscellaneous
Collateral Agent for the benefit of the Note A Indenture Trustee) as hereinabove
provided for, the Note B Indenture Trustee and all holders of any Series B Notes
shall be prohibited from receiving and disbursing any Proceeds realized from any
assets encumbered by any such lien rights or security interests until the
aggregate amounts owing under the Note A Indenture have been paid in full and an
event of default under the Note B Indenture or the IT Security Instruments has
occurred.
(e) Except as otherwise specifically provided for in Article VI below, and
not withstanding anything appearing to the contrary in any of the Recitals to
this Agreement, the respective rights (either directly or through the Collateral
Agent) of the Repo Purchaser, the Note A Indenture Trustee and the Note B
Indenture Trustee, as lienholders, repo purchaser or otherwise, to receive any
Proceeds of the CBO-2
Collateral, the Combined Collateral and the CBO REIT Stock Collateral shall
be only in accordance with Sections (a), (b), (c) and (d) of this Article III.
ARTICLE IV
THE COLLATERAL AGENT
(a) Appointment, Powers and Immunities. Each of the Repo Purchaser, the
Note A Indenture Trustee and the Note B Indenture Trustee hereby irrevocably
appoints and authorizes Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated to
act as Collateral Agent hereunder and under the Security Documents (and each
subsequent holder of any of the Repo Obligations or any successor trustee under
the Note A Indenture and the Note B Indenture, by its acceptance thereof, so
appoints and authorizes Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated) with
such powers as are specifically delegated to the Collateral Agent by the terms
of this Agreement and the Security Documents, together with such other powers as
are incidental thereto. The Collateral Agent (which term as used in this
Agreement shall include reference to its affiliates and its own and its
affiliates' officers, directors, employees and agents): (i) shall have no duties
or responsibilities except those expressly set forth in this Agreement and the
Security Documents, and shall not by reason of the transactions contemplated by
this Agreement or any of the Security Documents be a trustee or fiduciary for
either the Repo Purchaser, the Note A Indenture Trustee or the Note B Indenture
Trustee or any Noteholder or beneficial holder of any of the Repo Obligations ;
(ii) shall not be responsible to either the Repo Purchaser, the Note A Indenture
Trustee or the Note B Indenture Trustee or any Noteholder or beneficial holder
of any of the Repo Obligations for any recitals, statements, representations or
warranties (other than any thereof expressly made by the Collateral Agent or any
officer thereof) contained in this Agreement or in any of the Security Documents
or in any certificate or other document received by any of them under this
Agreement or any of the Security Documents, or for the value, validity,
effectiveness, genuineness, enforceability or sufficiency of this Agreement or
any of the Security Documents or for any failure by the Repo Purchaser, the Note
A Indenture Trustee or the Note B Indenture Trustee or any other Person to
perform any of its obligations hereunder or thereunder; and (iii) shall not be
responsible to the Repo Purchaser, the Note A Indenture Trustee, the Note B
Indenture Trustee, any Noteholder or any beneficial holder of the Repo
Obligations for any action taken or omitted to be taken by it hereunder or under
any of the Security Documents, except for its own gross negligence or willful
misconduct. The Collateral Agent may employ agents and attorneys-in-fact and
shall not be responsible for the negligence or misconduct of any such agents or
attorneys-in-fact selected by it in good faith. The Collateral Agent may deem
and treat the Note A Indenture Trustee and the Note B Indenture Trustee as
acting on behalf and for the benefit of the holders of the Series A Notes and
the Series B Notes, respectively, for all purposes hereof and for all purposes
under the Security Documents.
(b) Reliance by Collateral Agent. The Collateral Agent shall be entitled to
rely upon any certification, notice or other communication (including any
thereof by telephone, telex, telegram or cable) believed by it in good faith to
be genuine and correct and to have been signed or sent by or on behalf of the
proper Person or Persons, and upon
advice and statements of legal counsel, independent accountants and other
experts selected by the Collateral Agent. As to any matters not expressly
provided for by this Agreement or the Security Documents, the Collateral Agent
shall in all cases be fully protected in acting, or in refraining from acting,
hereunder or thereunder in accordance with instructions signed jointly by the
Repo Purchaser, the Note A Indenture Trustee and the Note B Indenture Trustee,
and such instructions and any action taken or omitted to be taken in accordance
with such instructions shall be binding on the Repo Purchaser, the Note A
Indenture Trustee and the Note B Indenture Trustee.
(c) Default Notices. The Collateral Agent shall not be deemed to have
knowledge of the occurrence of a default or an event of default under the Repo
Agreement or the Note A Indenture or the Note B Indenture unless the Collateral
Agent has received a default notice from the Repo Purchaser, the Note A
Indenture Trustee or the Note B Indenture Trustee, as applicable; provided,
however, that, notwithstanding the foregoing, the Collateral Agent shall give
immediate notice to the Repo Purchaser, the Note A Indenture Trustee and the
Note B Indenture Trustee in the event that CMI shall fail to deliver or cause to
be delivered to the Collateral Agent the Combined Collateral or the CBO REIT
Stock Collateral or shall fail to deliver or cause to be delivered such
documents as may be necessary to effectuate such delivery in the form and at the
times requested by the Collateral Agent, or shall fail to take such action as is
specified to be taken by the Collateral Agent in order to protect and maintain
the validity, perfection and priority of the liens and security interests
created or intended to be created pursuant to the Repo Agreement, the Security
Agreement and the other Security Documents, or shall fail to take any other
action requested by the Collateral Agent to be taken. In the event that the
Collateral Agent receives such a default notice from the Repo Purchaser, the
Note A Indenture Trustee or the Note B Indenture Trustee, the Collateral Agent
shall give prompt notice thereof to the other such parties.
(d) Rights to Conduct Ordinary Business. The Collateral Agent and its
affiliates may (without having to account therefor to the Repo Purchaser, the
Note A Indenture Trustee or the Note B Indenture Trustee) accept, lend money to
and generally engage in any kind of investment banking, or other business with
the Debtors, CBO REIT, the Repo Purchaser, the Note A Indenture Trustee or the
Note B Indenture Trustee (and any of their respective affiliates) as if it were
not acting as the Collateral Agent.
(e) Non-Reliance on Collateral Agent and Other Senior Creditors. Each of
the Repo Purchaser and the initial holders of the Series A Notes and the Series
B Notes (and each subsequent holder of any of the Repo Obligations or any of the
Notes by its acceptance thereof) agrees that it has, independently and without
reliance on the Collateral Agent, and based on such documents and information as
it has deemed appropriate, made its own credit analysis and evaluation of CBO
REIT, CMI and the other Debtors and their subsidiaries and filings relating
thereto and its own decision to acquire the interest in the Repo Obligations or
in one or more of the Notes and that it will, independently and without reliance
upon the Collateral Agent and based on such documents and information as it
shall deem appropriate at the time, continue to make its own analysis and
decisions in taking or not taking action under this Agreement and the Security
Documents. Except for actions expressly required of the Collateral Agent
hereunder, the Collateral Agent shall not be required to keep itself informed as
to the performance or observance by CBO REIT, CMI and the Debtors and their
subsidiaries of this Agreement or any Security Document or to inspect the
properties or books of any Person. Except for notices, reports and other
documents and information expressly required to be furnished to the Repo
Purchaser, the Note A Indenture Trustee and the Note B Indenture Trustee by the
Collateral Agent hereunder, the Collateral Agent shall not have any duty or
responsibility to provide the Repo Purchaser, the Note A Indenture Trustee, the
Note B Indenture Trustee or the holders of the Notes with any credit or other
information concerning the affairs, financial condition or business of CMI or
any other Debtor (or any of their respective subsidiaries or other affiliates)
which may come into the possession of the Collateral Agent or any of its
affiliates.
(f) Failure to Act. Except for action expressly required of the Collateral
Agent hereunder, the Collateral Agent shall in all cases be fully justified in
failing or refusing to act hereunder, unless it shall have received
indemnification to its satisfaction from the Repo Purchaser, the Note A
Indenture Trustee and the Note B Indenture Trustee in respect of any liability
and expense which may be incurred by the Collateral Agent by reason of taking or
continuing to take any such action, it being understood that the unsecured
undertaking from any institutional holder of an interest in the Repo Obligations
or the Notes in respect of such obligations shall be satisfactory for these
purposes.
(g) Resignation or Removal of Collateral Agent. Subject to the appointment
and acceptance of a successor Collateral Agent as provided below, the Collateral
Agent may resign at any time by giving notice thereof to the Repo Purchaser, the
Note A Indenture Trustee, the Note B Indenture Trustee and CMI. In addition, the
Collateral Agent may be removed at any time with or without cause by notice to
the Collateral Agent by the Repo Purchaser, the Note A Indenture Trustee and the
Note B Indenture Trustee acting together. Upon any such resignation or removal,
the Repo Purchaser shall have the right to appoint a successor Collateral Agent
reasonably satisfactory to the Note A Indenture Trustee, the Note B Indenture
Trustee and CMI. If no such successor Collateral Agent shall have been so
appointed or, having been so designated, shall not have accepted such
appointment, within (30) thirty days after notice of the resignation or removal
of the Collateral Agent, then the retiring or removed Collateral Agent may, on
behalf of the Repo Purchaser, the Note A Indenture Trustee and the Note B
Indenture Trustee, appoint a successor Collateral Agent which shall be a bank or
trust company with an office in New York City, Borough of Manhattan, having a
combined capital and surplus of at least $500,000,000 (if any such institution
be willing to serve as collateral agent hereunder). Upon the acceptance of any
appointment as Collateral Agent hereunder by a successor Collateral Agent, such
successor Collateral Agent shall thereupon succeed to and become vested with all
the rights, powers, privileges and duties of the retiring or removed Collateral
Agent, and the retiring or removed Collateral Agent shall be discharged from its
duties and obligations hereunder (except that the resigning or removed
Collateral Agent shall promptly deliver all collateral in its possession under
this Agreement or the Security Agreement or the other Security Documents to such
successor Collateral Agent). After any retiring or removed Collateral Agent's
resignation or removal hereunder as Collateral Agent, the provisions hereof
shall continue in effect for
its benefit in respect of any actions taken or omitted to be taken by it
while it was acting as the Collateral Agent.
(h) Appointment of IT Collateral Agent. Notwithstanding anything herein to
the contrary, upon payment in full of the Repo Obligations and termination of
the ownership interest of the Repo Purchaser in the CBO REIT Stock Collateral
and the liens and security interests of the Repo Purchaser in the CBO-2
Collateral, the CBO REIT Stock Collateral and the CBO-1/Nomura Collateral, the
Note A Indenture Trustee and the Note B Indenture Trustee, acting together,
shall appoint a successor collateral agent (the "IT Collateral Agent")
reasonably satisfactory to CMI and, upon the acceptance of such appointment by
the IT Collateral Agent, the Collateral Agent shall deliver forthwith all of the
CBO-2 Collateral, the CBO-1/Nomura Collateral and the CBO REIT Stock Collateral
then held by the Collateral Agent to the IT Collateral Agent. If the Note A
Indenture Trustee and the Note B Indenture Trustee, acting together, shall fail
to appoint the IT Collateral Agent within thirty (30) days after receipt of
notice that the Repo Obligations have been paid in full and that the ownership
interest of the Repo Purchaser in the CBO REIT Stock Collateral and the liens
and security interests of the Repo Purchaser in the CBO-2 Collateral, the CBO
REIT Stock Collateral and the CBO-1/Nomura Collateral have been terminated, or
having so designated an entity to act as IT Collateral Agent, such entity shall
not have accepted such appointment within such thirty (30) day period, the
Collateral Agent may appoint the IT Collateral Agent, which shall be either (i)
an affiliate of the Collateral Agent or the Collateral Agent itself, or (ii) a
bank or trust company within an office in the Borough of Manhattan, City of New
York having a combined capital and surplus of at least $500,000,000 (if any such
institution be willing to serve as the IT Collateral Agent).
(i) Collateral Agency Fees. Neither the Repo Purchaser, the Note A
Indenture Trustee nor the Note B Indenture Trustee shall be individually liable
for any collateral agency fees, as CMI has agreed to pay the Collateral Agent
the collateral agency fees separately agreed upon between CMI and the Collateral
Agent with respect to this Agreement and the Security Documents and to pay any
successor to the Collateral Agent such collateral agency fees as such successor
Collateral Agent shall from time to time charge (in accordance with its normal
practice) for performance of services of the type required of it hereunder and
under the Security Documents. Such amounts payable to the Collateral Agent shall
be entitled to the benefits of a lien on the Combined Collateral and the CBO
REIT Stock Collateral.
(j) Perfection of Liens. The Collateral Agent shall be responsible (but the
parties hereto acknowledge that in the first instance CMI or the relevant Debtor
or CBO REIT has taken all necessary action) for any required recording or filing
of the Security Documents, all necessary Uniform Commercial Code financing,
amendment and/or continuation statements, and any other instruments of further
assurance, and for taking all other actions described in the Plan, the Security
Agreement or the Security Documents as being advisable to maintain the validity,
perfection or priority of the security interests created and intended to be
created by the Security Documents. The Collateral Agent shall not be responsible
for seeing that any of the Combined Collateral or the CBO REIT Stock Collateral
is adequately insured, or for the sufficiency of the security for the Repo
Obligations or the New Debt. The Collateral Agent may ascertain or inquire as to
the performance or observance of any agreements on the part of CMI or any of the
Debtors or CBO REIT under any Security Document, and the Collateral Agent may
require of CMI or any of the Debtors or CBO REIT information and advice as to
the performance of such agreements. The Collateral Agent shall have no
obligation to perform (although it may in its discretion perform) any of the
duties of CMI or any of the Debtors or CBO REIT hereunder or under the Security
Agreement or any other Security Document, it being understood that whenever in
any Security Document a provision shall give the Collateral Agent the right "in
its discretion", or to the extent it shall "deem it necessary", to take or
request certain types of action, such provision shall not be construed to
require the Collateral Agent to exercise discretion or make determinations as to
whether to request or take such action but shall rather be construed to permit
the Collateral Agent to request or take such action and, provided, however, that
to the extent jointly instructed by the Repo Purchaser, the Note A Indenture
Trustee and the Note B Indenture Trustee pursuant to the applicable provisions
of this Agreement, the Collateral Agent shall request or take the action which
it is so instructed to request or take.
ARTICLE V
FORBEARANCE
(a) CBO-2 Collateral, CBO-1/Nomura Collateral and CBO REIT Stock
Collateral. Without regard to whether or not any default or event of default on
the New Debt has occurred or is continuing, the Note A Indenture Trustee and the
Note B Indenture Trustee agree (which agreement shall be binding on the
Noteholders by their acceptance of the benefits of this Agreement and the IT
Security Instruments), that neither the Note A Indenture Trustee nor the Note B
Indenture Trustee, nor any holder of a Series A Note or a Series B Note, shall
have the right, without the prior written approval of the Repo Purchaser, (i) to
foreclose upon, liquidate or otherwise realize upon (or direct the Collateral
Agent to do so), either Indenture Trustee's security interest in the CBO-2
Collateral, the CBO-1/Nomura Collateral, the CBO REIT Stock Collateral or the
Accounts, except as otherwise expressly provided for in Article V, Section (d);
(ii) to take any action for the specific purpose of delaying or interfering with
the rights of the Repo Purchaser, or the Collateral Agent acting for the Repo
Purchaser, with respect to the CBO-2 Collateral, the Combined Collateral, the
CBO REIT Stock Collateral or the Accounts (including without limitation, the
taking of any action the specific purpose of which is to seek or obtain any stay
or injunction that would have the effect of impeding or delaying the ability of
the Repo Purchaser, or the Collateral Agent at its direction, to effect an Arm's
Length Sale or Deemed Sale pursuant to the Repo Agreement, or to foreclose on
any security interest granted to the Repo Purchaser, or to the Collateral Agent
for the benefit of the Repo Purchaser, relative to the CBO-2 Collateral, the
Combined Collateral, the CBO REIT Stock Collateral or the Accounts); or (iii) to
take any action adverse to the Repo Purchaser, or the Collateral Agent acting
for the Repo Purchaser, in a non-bankruptcy court enforcement proceeding with
respect to the CBO-2 Collateral, the Combined Collateral, the CBO REIT Stock
Collateral or the Accounts; provided, however, that the forbearance provisions
set forth in this Article V, Section (a) shall not excuse the Repo Purchaser
from the performance of any of its obligations under
the Repo Agreement, this Agreement, the Security Agreement, the RP Security
Instruments or applicable law, or exculpate the Repo Purchaser from liability
for the failure of the Repo Purchaser (or the Collateral Agent acting on its
behalf) to comply with the performance of any of such obligations, and the
Indenture Trustees may seek injunctive relief to secure performance by the Repo
Purchaser of such obligations unless such injunctive relief shall be sought for
the purpose, or if granted would have the effect, of delaying, impeding or
interfering with any of the Excluded RP Actions, and nothing contained in this
Article V, Section (a) shall impair, diminish or otherwise affect the rights of
the Indenture Trustees (or either of them) under Article VI hereof; provided
further, however, that (a) upon any Arm's Length Sale of the CBO-2 Collateral,
the Note A Indenture Trustee and the Note B Indenture Trustee shall be entitled
to receive the Net Sale Proceeds in respect of such Arm's Length Sale, if and to
the extent expressly provided for in Article VI, Section (b) below, and (b) upon
any Arm's Length Sale of either the Combined Collateral or the CBO REIT Stock
Collateral, the Note A Indenture Trustee and the Note B Indenture Trustee shall
be entitled to receive the CBO-1/Nomura Collateral Proceeds and any excess CBO-2
Collateral Proceeds realized therefrom, if and to the extent expressly provided
for in Article VI, Section (c) below.
(b) Additional Forbearance Terms. Without limiting the generality of this
Article V, Section (a) above, neither the Note A Indenture Trustee, the Note B
Indenture Trustee nor any holder of a Series A Note or a Series B Note shall,
without prior written approval of the Repo Purchaser, (i) seek or obtain in a
non-bankruptcy court enforcement proceeding any stay or injunction impeding the
Repo Purchaser, or the Collateral Agent acting on its behalf, from effecting any
Arm's Length Sale or Deemed Sale pursuant to the Repo Agreement, the Security
Agreement, the RP Security Instruments or otherwise, or foreclosing on any
security interest granted to the Repo Purchaser or the Collateral Agent for the
benefit of the Repo Purchaser (or granted to MLMCI and GACC and assigned to the
Repo Purchaser, or the Collateral Agent for the benefit of the Repo Purchaser),
or (ii) seek to compel the Repo Purchaser, or the Collateral Agent for the
benefit of the Repo Purchaser, to sell or otherwise dispose of, or not to sell
or otherwise dispose of, any of the CBO REIT Stock Collateral, the CBO-2
Collateral, the Combined Collateral or the Accounts, or to sell them in any
particular order, provided, however, that the forbearance provisions set forth
in this Article V, Section (b) shall not excuse the Repo Purchaser from the
performance of any of its obligations under the Repo Agreement, this Agreement,
the Security Agreement, the RP Security Instruments or applicable law, or
exculpate the Repo Purchaser from liability for the failure of the Repo
Purchaser (or the Collateral Agent acting on its behalf) to comply with any of
such obligations, and the Indenture Trustees may seek injunctive relief to
secure performance by the Repo Purchaser of such obligations, unless such
injunctive relief shall be sought for the purpose, or if granted would have the
effect, of delaying, impeding or interfering with any of the Excluded RP
Actions. It is further agreed that, with respect to foreclosure and realization
on the CBO-2 Collateral, the Combined Collateral, the CBO REIT Stock Collateral
or the Accounts, as applicable, by sale or otherwise, the Repo Purchaser shall
be free to proceed (or to direct the Collateral Agent to proceed) in whatever
commercially reasonable manner the Repo Purchaser selects and the only recourse
for the Note A Indenture Trustee, the Note B Indenture Trustee and the
Noteholders, if they dispute the means by which the Repo Purchaser (or the
Collateral Agent at its direction) shall have
foreclosed on or otherwise realized on the CBO-2 Collateral, the Combined
Collateral, the CBO REIT Stock Collateral or the Accounts, as applicable, or
otherwise assert that the Repo Purchaser has breached or failed to comply with
its obligations under the Repo Agreement, this Agreement, the RP Security
Instruments or applicable law, shall be to commence an action for money damages
against the Repo Purchaser; provided, however, that any such action against the
Repo Purchaser brought by the Note A Indenture Trustee, the Note B Indenture
Trustee and/or the Noteholders for money damages on account of a dispute
regarding the means by which the Repo Purchaser (or the Collateral Agent at its
direction) shall have foreclosed on or otherwise realized on the CBO-2
Collateral, the Combined Collateral or the CBO REIT Stock Collateral, as
applicable, may only be commenced subsequent to the foreclosure or realization
giving rise to such dispute.
(c) Mutual Forbearance Terms. Neither the Repo Purchaser, nor the Note A
Indenture Trustee nor the Note B Indenture Trustee nor any Noteholder shall,
without the prior written consent of the Repo Purchaser, the Note A Indenture
Trustee or the Note B Indenture Trustee, as the case may be, (i) commence any
involuntary bankruptcy case against CBO REIT, (ii) seek from any court
(including, without limitation, a bankruptcy court) an order recharacterizing
the Repo Agreement as a secured loan transaction, (iii) seek from any bankruptcy
court, in the event of a bankruptcy case in which CMI is a debtor, an order
substantively consolidating the estates of CBO REIT and CMI, (iv) seek to
nullify or modify in any way the terms of this Agreement, the Repo Agreement,
the Security Agreement or any of the RP Security Instruments or the IT Security
Instruments in the event of a bankruptcy case in which CMI and/or CBO REIT is a
debtor, (v) take any action opposing a lift stay motion brought by the Repo
Purchaser or the Indenture Trustees in a bankruptcy case regarding CMI as a
debtor and involving any of the CBO-2 Collateral, the Combined Collateral, the
CBO REIT Stock Collateral or the Accounts; or (vi) commence or attempt to
commence an involuntary bankruptcy case against CMI without giving the Repo
Purchaser (if such case is being commenced by either or both of the Indenture
Trustees or any or all of the holders of the Series A Notes and/or the Series B
Notes) or the Indenture Trustees (if such case is being commenced by the Repo
Purchaser) written notice of its intention to commence such case at least three
(3) Business Days prior to filing the petition with respect thereto.
(d) Termination of Forbearance. The forbearance obligations of the Note A
Indenture Trustee and the Note B Indenture Trustee and the holders of the Series
A Notes and the Series B Notes, as set forth in subsections (a), (b) and (c) of
this Article V, shall terminate and be null and void, and the Note A Indenture
Trustee and the Note B Indenture Trustee shall be free to exercise any and all
of their respective rights and remedies as provided for under the Plan, the
Security Agreement, this Agreement, the IT Security Instruments, the Note A
Indenture, the Note B Indenture or otherwise at such time as the Repo Purchaser
shall have received the Repurchase Price, and the Repo Obligations shall have
been paid in full; provided, however, that, subject to the provisions of this
Article V, Section (d)(iii)(y) below, the Note A Indenture Trustee's and the
Note B Indenture Trustee's forbearance obligations as hereinabove set forth
shall not terminate, and shall continue, if the Repurchase Price is paid to the
Repo Purchaser by means of a Permitted Refinancing of the Repo Obligations, or
if the holder of the obligations under any Permitted Refinancing is repaid by
any subsequent Permitted
Refinancing. In this regard, a "Permitted Refinancing" shall be as defined
in the Note A Indenture and the Note B Indenture in effect on the date hereof
and without giving effect to any subsequent amendments thereof.
Notwithstanding anything to the contrary in this Agreement:
(x) all such forbearance obligations on the part of the Note A Indenture
Trustee, the Note B Indenture Trustee and the holders of the Series A Notes and
the Series B Notes shall terminate with respect to the CBO-1/Nomura Collateral
(and only with respect to the CBO-1/Nomura Collateral) upon any foreclosure,
sale, or other disposition of all or substantially all of the CBO-2 Collateral
that does not involve a simultaneous foreclosure, sale, or other disposition of
the CBO REIT Stock Collateral or the CBO-1/Nomura Collateral; and
(y) all forbearance obligations on the part of the Note A Indenture
Trustee, the Note B Indenture Trustee and the holders of the Series A Notes and
the Series B Notes shall continue with respect to the CBO-1/Nomura Collateral,
the CBO-2 Collateral, the CBO REIT Stock Collateral and the Accounts upon the
sale or assignment by the Repo Purchaser of its rights under the Repo Agreement
and/or its claims against CMI as evidenced by the Repo Obligations and the
assumption by said buyer or assignee of all of the obligations of the Repo
Purchaser under this Agreement; provided, however, that in the event that any
such buyer or assignee (or any affiliate of such buyer or assignee guaranteeing
the performance of the obligations of the Repo Purchaser assumed by such buyer
or assignee under this Agreement) is a person or entity that at the time of such
sale or assignment does not have either (i) financial resources comparable to
those of the Repo Purchaser, as reasonably determined by the Indenture Trustees,
or (ii) a net worth of not less than Two Hundred Million ($200,000,000) Dollars,
the Repo Purchaser shall remain fully liable for any claims, damages, causes of
action and liabilities arising from or in connection with, or as a result of any
breach by the Repo Purchaser (or by such buyer or assignee) of, the Repo
Agreement, this Agreement, the Security Agreement, the RP Security Documents or
any documents executed incident thereto; provided further, however, that
notwithstanding anything herein to the contrary, in the event that, at any time
subsequent to such sale or assignment, such buyer or assignee, or any such
affiliate guarantor, fails to maintain a net worth of at least Two Hundred
Million ($200,000,000) Dollars, then, without regard to the forbearance
provisions of this Article V, either or both of the Indenture Trustees shall be
entitled to seek injunctive relief to secure performance by such buyer or
assignee, as successor to the Repo Purchaser, of any and all of its obligations
under the Repo Agreement, this Agreement, the Security Agreement, the RP
Security Instruments or applicable law, whether or not such injunctive relief to
secure such performance shall be sought for the purpose, or if granted, would
have the effect, of delaying, impeding or interfering with any of the Excluded
RP Actions. In order to determine the Indenture Trustees' entitlement to seek
injunctive relief as permitted under the immediately preceding proviso, either
Indenture Trustee, or the Indenture Trustees acting jointly, as applicable,
shall, prior to seeking such injunctive relief, deliver to such buyer or
assignee, as successor to the Repo Purchaser, written notice of its or their
intention to seek such injunctive relief not less than three (3) Business Days
prior to the exercise of such rights. Unless such buyer or
assignee shall, prior to the expiration of such three (3) Business Day
period, deliver to such Indenture Trustee or the Indenture Trustees, as
applicable, a certification (the "Net Worth Certification") from a nationally
recognized, independent accounting firm evidencing a then current net worth of
such buyer or assignee, or of any such affiliate guarantor, of at least Two
Hundred Million ($200,000,000) Dollars, such Indenture Trustee, or the Indenture
Trustees, as the case may be, shall be permitted to proceed with the exercise of
such injunction rights, provided, however, that in the event that such buyer or
assignee shall deliver the Net Worth Certification to such Indenture Trustee or
the Indenture Trustees, as applicable, subsequent to the expiration of said
three (3) Business Day period, but prior to the earlier to occur of (i) the
expiration of seven (7) days after delivery by such Indenture Trustee or the
Indenture Trustees, as applicable, to such buyer or assignee of written notice
of its or their intention to seek injunctive relief, and (ii) the entry of an
order granting a preliminary or permanent injunction in response to the request
by the Indenture Trustee, or the Indenture Trustees, as applicable, such
Indenture Trustee, or the Indenture Trustees, as the case may be, shall
thereupon forbear from seeking such injunctive relief and shall vacate any
temporary restraining order or judgment that may have been entered in the
interim.
(e) Repo Purchaser Obligations on Termination. Upon the termination of the
Note A Indenture Trustee's and the Note B Indenture Trustee's forbearance
obligations provided for herein, the consent of the Repo Purchaser shall not be
required with respect to the exercise of any right or remedy available to the
Note A Indenture Trustee and the Note B Indenture Trustee (including the right
to enforce any liens and security interests) relative to the CBO-2 Collateral,
the CBO REIT Stock Collateral or the CBO-1/Nomura Collateral; and the Repo
Purchaser shall thereafter execute such documents and take such actions as shall
be reasonably requested by the Note A Indenture Trustee and/or the Note B
Indenture Trustee or as shall be necessary to allow the Note A Indenture Trustee
and the Note B Indenture Trustee to exercise any such available rights and
remedies; provided, however, that the Repo Purchaser (and the Collateral Agent
to the extent acting on behalf of the Repo Purchaser) shall not be obligated to
incur any cost or expense in connection with any such document or action, and
shall be indemnified by the Indenture Trustees against all costs and expenses
associated with any such documents and actions.
(f) Additional Provisions Regarding Sale of Collateral. Prior to the
termination of the forbearance obligations of the Note A Indenture Trustee, the
Note B Indenture Trustee and the holders of the Series A Notes and the Series B
Notes as hereinabove set forth, the Note A Indenture Trustee, the Note B
Indenture Trustee and each Noteholder (and the Collateral Agent acting on their
behalf) shall not have any right to sell, liquidate, transfer or otherwise
dispose of any of the CBO-2 Collateral, the CBO REIT Stock Collateral, the
CBO-1/Nomura Collateral or the Accounts; provided, however, that notwithstanding
anything in this Agreement to the contrary, at any sale or disposition of the
CBO-2 Collateral, the Combined Collateral or the CBO REIT Stock Collateral by
the Repo Purchaser, whether by foreclosure or otherwise, following an event of
default under the Repo Agreement, the RP Security Instruments, the Repo
Obligations or otherwise, the Note A Indenture Trustee and the Note B Indenture
Trustee shall be entitled jointly to credit bid up to the outstanding amount of
the Notes and all obligations then owing to the holders thereof under the Note A
Indenture and the Note B
Indenture in connection therewith, subject to the provisions of Article V,
Section (g) below. In this regard, the parties hereto further agree and
expressly acknowledge that, notwithstanding anything in this Agreement to the
contrary, and as more specifically set forth in the Note A Indenture and the
Note B Indenture, any default under the Plan, the Repo Agreement, the RP
Security Instruments, the Security Agreement or otherwise relative to the Repo
Obligations, which default shall continue beyond the expiration of any
applicable notice and cure period, and (x) pursuant to which the Repo Purchaser,
MLMCI or GACC has taken or is taking any action to enforce default remedies
(other than one or more Excluded RP Remedies) available under the Plan, the Repo
Agreement, the RP Security Instruments, the Security Agreement, or otherwise, in
equity or at law, with respect to the CBO-2 Collateral, the CBO-1/Nomura
Collateral, the CBO REIT Stock Collateral or the Accounts, or (y) after which
the Repo Purchaser, MLMCI or GACC have improved their position in any respect
vis-a-vis CMI or CBO REIT, as a result of negotiations or otherwise (it being
understood and agreed by the parties that in no event shall any action taken
only to cure one or more defaults by CMI under the Repo Agreement, including
without limitation the payment of any unpaid amount then due and payable to the
Repo Purchaser pursuant to the Repo Agreement in respect of the Repo Obligations
or the performance of any express Repo Agreement or Security Document obligation
as to which CMI or any of its affiliates shall then be delinquent, constitute
such an improvement in position), shall constitute a default under the Series A
Notes and the Series B Notes, permitting the Note A Indenture Trustee and the
Note B Indenture Trustee to exercise all rights and remedies available to the
Note A Indenture Trustee and the Note B Indenture Trustee, subject only to such
Indenture Trustees' forbearance obligations as expressly provided for herein and
the Indenture Trustees' obligations in respect of any Deemed Sale as provided in
Article VI of this Agreement.
(g) Credit Bid Provisions. In connection with any sale or disposition of
the CBO-2 Collateral, the Combined Collateral or the CBO REIT Stock Collateral,
whether by foreclosure or otherwise, following an event of default under the
Repo Agreement, the RP Security Instruments, the Repo Obligations or otherwise,
the Note A Indenture Trustee and the Note B Indenture Trustee shall be entitled
(but shall not be required) jointly to credit bid up to the outstanding amount
of the Notes and all obligations then owing to the holders thereof or the
Indenture Trustees under the Note A Indenture and the Note B Indenture, upon and
subject to the following terms and conditions:
(i) If such disposition is effectuated by means of a Deemed Sale of the
CBO-2 Collateral, the Combined Collateral or the CBO REIT Stock Collateral, as
applicable, any such joint credit bid undertaken by the Note A Indenture Trustee
and the Note B Indenture Trustee shall be made and implemented only in concert
with the Repo Purchaser, pursuant to and in accordance with the terms and
conditions of Articles VI and VII of this Agreement.
(ii) If such disposition is effectuated by means of an Arm's Length Sale of
the CBO-2 Collateral, the Combined Collateral or the CBO REIT Stock Collateral,
as applicable, any such joint credit bid undertaken by the Note A Indenture
Trustee and the Note B Indenture Trustee shall be made only if and to the extent
it includes a cash payment to the Repo Purchaser of an amount equal to payment
in full of
the then outstanding Repo Obligations secured by such collateral being
disposed of by such Arm's Length Sale, or otherwise as is acceptable to the Repo
Purchaser in its sole and absolute discretion.
ARTICLE VI
DISPOSITION OF COLLATERAL
Upon (i) the payment in full of the Repo Obligations by CMI as permitted or
required under the Repo Agreement, or (ii) the occurrence of any default beyond
the expiration of any applicable notice and cure period under the Plan, the Repo
Agreement, the Security Agreement, the RP Security Instruments or otherwise
which gives rise to a right in the Repo Purchaser to foreclose on or otherwise
dispose of (or direct the Collateral Agent to do so on its behalf) any or all of
the CBO-2 Collateral, the Combined Collateral or the CBO REIT Stock Collateral
(a "Disposition Default") the following provisions shall apply:
(a) Payment of the Repo Obligations by CMI. In the event that CMI shall pay
the Repo Purchaser the Repurchase Price and satisfy all other Repo Obligations
owing to the Repo Purchaser as provided for under the Repurchase Agreement, all
ownership interests, liens and security interests of the Repo Purchaser shall be
terminated, released and removed from all of the CBO-2 Collateral, the
CBO-1/Nomura Collateral, and the CBO REIT Stock Collateral and all Proceeds
thereof, and from the Collection Account and the New Note Collection Account,
and the Repo Purchaser shall take (or shall direct the Collateral Agent to take)
all actions and execute all documents, instruments and filings as may be
required to effectuate such termination, removal and release of such ownership
interests, liens and security interests. Upon such termination, release and
removal of all ownership interests, liens and security interests of the Repo
Purchaser on the CBO-2 Collateral, the CBO-1/Nomura Collateral, and the CBO REIT
Stock Collateral and all Proceeds thereof, and from the Collection Account and
the New Note Collection Account, the Collateral Agent shall deliver all of the
remaining CBO-2 Collateral, the CBO-1/Nomura Collateral and the CBO REIT Stock
Collateral, and dominion and control of the Collection Account and the New Note
Collection Account to the IT Collateral Agent, as provided for in Article IV,
Section (d) above in order to continue the perfection of the liens and security
interests of the Note A Indenture Trustee and the Note B Indenture Trustee,
respectively, in the CBO-2 Collateral, the CBO-1/Nomura Collateral, and the CBO
REIT Stock Collateral and all Proceeds thereof, and on the Collection Account
and the New Note Collection Account, which liens and security interests shall
thereupon enjoy first-priority status and second-priority status, respectively,
in all respects and shall not be subordinate to the ownership interests, liens
or security interests of any creditor claiming by, through or under the Repo
Purchaser, except as otherwise provided in connection with a Permitted
Refinancing, as defined in Article V, Section (d) (ii) above, and as more
specifically set forth below. Furthermore, as noted above, upon the Repo
Purchaser's receipt of the Repurchase Price and the payment and performance of
all other Repo Obligations and the Repo Purchaser's and Collateral Agent's
execution of the termination, removal and release documents described above,
none of the Repo Purchaser, MLMCI or GACC or any prior holder of
any Repo Obligations shall thereafter have any rights, either directly or
through the Collateral Agent, in or to the CBO-2 Collateral, the CBO-1/Nomura
Collateral, the CBO REIT Stock Collateral or any Proceeds thereof, or in or to
the Collection Account or the New Note Collection Account, and the Note A
Indenture Trustee and the Note B Indenture Trustee, respectively, shall each be
free of any restrictions or conditions imposed by this Agreement, whether
pursuant to the forbearance provisions of this Agreement or otherwise, relative
to their respective rights, obligations and remedies in connection with the
CBO-2 Collateral, the CBO-1/Nomura Collateral, and the CBO REIT Stock Collateral
and the Proceeds thereof, and the Collection Account and the New Note Collection
Account. Anything in this paragraph to the contrary notwithstanding, in the
event that CMI effectuates the payment of the Repo Obligations by means of a
Permitted Refinancing (or effectuates a refinancing of a Permitted Refinancing
by means of another Permitted Refinancing) the liens and security interests of
the Note A Indenture Trustee and the Note B Indenture Trustee on and in the
CBO-2 Collateral, the CBO-1/Nomura Collateral, or the CBO-2 REIT Stock
Collateral, as applicable, shall remain subordinate to the liens and security
interests of the "take out lender" or "successor Repo Purchaser" under such
Permitted Refinancing, as expressly provided in this Agreement, but only if and
to the extent such take out lender or successor Repo Purchaser succeeds to the
rights of the Repo Purchaser pursuant to this Agreement, the Repo Agreement, the
Security Agreement, the RP Security Instruments or otherwise with respect to any
or all of the CBO-2 Collateral, the CBO-1/Nomura Collateral and the CBO REIT
Stock Collateral.
(b) Disposition of CBO-2 Collateral Only. Upon a Disposition Default where
the Repo Purchaser elects to dispose of the CBO-2 Collateral (but not any of the
CBO-1/Nomura Collateral or the CBO REIT Stock Collateral), such disposition
shall be effectuated by either an Arm's Length Sale or a Deemed Sale of the
CBO-2 Collateral as follows:
(i) Arm's Length Sale. In the event the Repo Purchaser elects to foreclose
on and dispose of the CBO-2 Collateral by an Arm's Length Sale, the Repo
Purchaser shall sell (or direct the Collateral Agent to sell) the CBO-2
Collateral to a third party purchaser in a commercially reasonable manner. In
this regard, all liens and security interests of (or for the benefit of) the
Repo Purchaser, the Note A Indenture Trustee and the Note B Indenture Trustee on
and in the CBO-2 Collateral shall be released in connection with such sale,
effective upon the receipt by the Collateral Agent of the Proceeds of such sale
(the "CBO-2 Sale Proceeds"). Upon the Collateral Agent's receipt of the CBO-2
Sale Proceeds, the Collateral Agent shall pay the actual costs of sale of the
CBO-2 Collateral and shall then pay the amounts then owing to the Repo Purchaser
on account of the Repurchase Price and the other Repo Obligations and shall
thereafter pay over any Net Sales Proceeds first to the Note A Indenture Trustee
to the extent of any outstanding obligations on account of the Series A Notes,
then to the Note B Indenture Trustee to the extent of any outstanding
obligations on account of the Series B Notes, with any remaining Net Sale
Proceeds to be paid to CMI or such other party as may be lawfully entitled
thereto.
(ii) Deemed Sale. In the event the CBO-2 Collateral shall be sold in a
Deemed Sale, all liens and security interests of (or for the benefit of) the
Repo Purchaser, the Note A Indenture Trustee and the Note B Indenture Trustee on
such assets shall be released and removed in connection with such sale, and
(except as otherwise provided in the last sentence of this Section (b)(ii)) the
Repo Purchaser, the Note A Indenture Trustee and the Note B Indenture Trustee
shall thereupon jointly acquire the CBO-2 Collateral in the Deemed Sale Entity
pursuant to such Deemed Sale (with each of the Repo Purchaser, the Note A
Indenture Trustee and the Note B Indenture Trustee being deemed to have acquired
a beneficial ownership interest in the CBO-2 Collateral). The Repo Purchaser
shall thereafter receive all Distributions attributable to the CBO-2 Collateral
until such time as the CBO-2 Collateral shall be disposed of in an Arm's Length
Sale, which Distributions shall be applied to any Repo Obligations then
remaining unpaid. Upon any such subsequent Arm's Length Sale of the CBO-2
Collateral, the Repo Purchaser shall receive the CBO-2 Sale Proceeds after the
payment of the actual costs of such sale, to the extent of any amounts then
remaining unpaid on account of the Repo Obligations, with any remaining Net Sale
Proceeds to be paid, subject to the provisions of Article VII, Section
(b)(ii)(A) below, first to the Note A Indenture Trustee to the extent of any
outstanding obligations on account of the Series A Notes, and then to the Note B
Indenture Trustee to the extent of any outstanding obligations on account of the
Series B Notes, with any remaining Net Sale Proceeds to be paid to the Repo
Purchaser. Notwithstanding anything in this Article VI, Section (b)(ii) to the
contrary, however, in the event either or both of the Note A Indenture Trustee
and the Note B Indenture Trustee elect, pursuant to Article VII, Section
(b)(ii)(A), not to participate in the "credit bid" procedure for a Deemed Sale
of the CBO-2 Collateral, the liens and security interests of (or for the benefit
of) such electing Indenture Trustee(s) on and in the CBO-2 Collateral shall
nevertheless be released and removed in connection with such sale, and such
electing Indenture Trustee(s) shall have no beneficial ownership interest in the
applicable Deemed Sale Entity or the CBO-2 Collateral and shall forfeit any and
all rights to any Proceeds or Distributions thereafter realized on the CBO-2
Collateral, and the Repo Purchaser and the Collateral Agent shall thereafter
have no further obligations to such electing Indenture Trustee(s) with respect
to the CBO-2 Collateral or any amounts thereafter received by the Repo Purchaser
or the Collateral Agent in respect thereof, whether as a result of collection of
any Distributions payable thereon or in connection with a sale or other
disposition of all or any portion thereof, or otherwise.
(c) Disposition of Combined Collateral or CBO REIT Stock Collateral. Upon a
Disposition Default where the Repo Purchaser elects to dispose of the Combined
Collateral or the CBO REIT Stock Collateral, such disposition shall be
effectuated by either an Arm's Length Sale or a Deemed Sale of the Combined
Collateral or the CBO REIT Stock Collateral, as follows:
(i) Arm's Length Sale. In the event the Repo Purchaser elects to foreclose
on and dispose of either the Combined Collateral or the CBO REIT Stock
Collateral, as the case may be, by an Arm's Length Sale, the Repo Purchaser
shall sell (or shall direct the Collateral Agent to sell) the Combined
Collateral or the CBO REIT Stock Collateral, as applicable, to a third-party
purchaser in a commercially reasonable manner. In this regard, all liens and
security interests of (or for the benefit of) the Repo Purchaser,
the Note A Indenture Trustee and the Note B Indenture Trustee on such
assets shall be released and removed in connection with such sale, effective
upon the receipt by the Collateral Agent of the Proceeds of such sale (the
"Combined Collateral Proceeds" or the "CBO REIT Stock Collateral Proceeds", as
applicable). Upon the Collateral Agent's receipt of the Combined Collateral
Proceeds or the CBO REIT Stock Collateral Proceeds, as the case may be, the
Collateral Agent shall pay the actual costs of sale of the Combined Collateral
or the CBO REIT Stock Collateral, as applicable, and shall thereafter pay over
the remaining proceeds as follows:
(A) The CBO-1/Nomura Collateral Proceeds shall be paid first to the Note A
Indenture Trustee to the extent of any outstanding obligations on account of the
Series A Notes, then to the Note B Indenture Trustee to the extent of any
outstanding obligations on account of the Series B Notes, and then, to the
extent that the Repo Obligations are not then paid in full from the CBO-2
Collateral Proceeds to the Repo Purchaser, until the Repo Obligations have been
paid in full, with any then remaining CBO-1/Nomura Collateral Proceeds to be
paid to CMI or such other party as may be lawfully entitled thereto.
(B) The CBO-2 Collateral Proceeds shall be paid first to the Repo Purchaser
to the extent of any outstanding balance of the Repo Obligations, then to the
Note A Indenture Trustee to the extent of any remaining obligations on account
of the Series A Notes, then to the Note B Indenture Trustee to the extent of any
remaining obligations on account of the Series B Notes, with any remaining CBO-2
Collateral Proceeds to be paid to CMI or such other party as may be lawfully
entitled thereto.
(ii) Deemed Sale. Except as otherwise provided in the last paragraph of
this Article VI, Section (c)(ii), in the event the Combined Collateral or the
CBO REIT Stock Collateral, as the case may be, shall be sold, in a Deemed Sale,
such collateral shall thereupon be transferred to the Deemed Sale Entity and all
liens and security interests of (or for the benefit of) the Repo Purchaser, the
Note A Indenture Trustee and the Note B Indenture Trustee on such assets shall
be released and removed in connection with any such sale, and the Repo
Purchaser, the Note A Indenture Trustee and the Note B Indenture Trustee shall
be deemed to have jointly acquired a beneficial ownership interest in the
Combined Collateral or the CBO REIT Stock Collateral, as applicable. Moreover,
the net effect of a Deemed Sale of the Combined Collateral or the CBO REIT Stock
Collateral, as the case may be, to the Deemed Sale Entity will be that the
Combined Collateral or the CBO REIT Stock Collateral, as applicable, shall be
transferred to the Deemed Sale Entity free and clear of any and all liens and
security interests in favor of (or for the benefit of) the Repo Purchaser, the
Note A Indenture Trustee or the Note B Indenture Trustee, but subject to the
respective beneficial ownership interests of the Repo Purchaser, the Note A
Indenture Trustee and the Note B Indenture Trustee in the Deemed Sale Entity.
Upon any subsequent Arm's Length Sale of the Combined Collateral or the CBO REIT
Stock Collateral, as applicable, as provided for in this Article VI, Section (d)
below, the Combined Collateral Proceeds or the CBO REIT Stock Collateral
Proceeds, as the case may be, resulting from such Arm's Length Sale shall be
applied first on account of the actual costs of sale of the Combined Collateral
or the CBO REIT Stock Collateral, as applicable, and then paid over as follows:
(A) The CBO-1/Nomura Collateral Proceeds shall be paid first to the Note A
Indenture Trustee to the extent of any then outstanding obligations on account
of the Series A Notes, then to the Note B Indenture Trustee to the extent of any
then outstanding obligations on account of the Series B Notes, and then, to the
extent that the Repo Obligations are not then paid in full from the CBO-2
Collateral Proceeds, to the Repo Purchaser, until the Repo Obligations have been
paid in full, with any then remaining CBO-1/Nomura Collateral Proceeds to be
paid to the Indenture Trustees.
(B) The CBO-2 Collateral Proceeds shall be paid first to the Repo Purchaser
to the extent of any outstanding balance of the Repo Obligations, then to the
Note A Indenture Trustee to the extent of any remaining obligations on account
of the Series A Notes, then to the Note B Indenture Trustee to the extent of any
remaining obligations on account of the Series B Notes, with any remaining CBO-2
Collateral Proceeds to be paid to the Repo Purchaser.
Notwithstanding the foregoing, the Combined Collateral or the CBO REIT
Stock Collateral, as applicable (the "Shared Collateral"), will not be jointly
acquired by the Repo Purchaser and the Indenture Trustees pursuant to a Deemed
Sale if either (A) the Repo Purchaser offers (a "Voluntary Buyout Offer") to
make a cash payment to the Indenture Trustees in exchange for the release or
assignment of the Indenture Trustees' security interests in the Shared
Collateral and the Indenture Trustees accept such Voluntary Buyout Offer or (B)
the Indenture Trustees make a Voluntary Buyout Offer for the CBO REIT Stock
Collateral or for the release or assignment of the Repo Purchaser's security
interests in the Combined Collateral, as applicable, and the Repo Purchaser
accepts such Voluntary Buyout Offer (it being understood and agreed that neither
the Repo Purchaser nor the Indenture Trustees will be obligated to make or
accept any Voluntary Buyout Offer).
(iii) Payment of Distributions During Deemed Sale Period. From and after
the date of the Deemed Sale of the Combined Collateral or the CBO REIT Stock
Collateral, as applicable, to the Deemed Sale Entity through the date of the
termination of the Deemed Sale Period, as provided for in Article VI, Section
(d) below, the Repo Purchaser shall receive all Distributions attributable to
the CBO-2 Collateral, which shall be applied to any Repo Obligations then
remaining unpaid, and the Note A Indenture Trustee shall receive all
Distributions attributable to the CBO-1/Nomura Collateral, which shall be
applied to any accrued interest and principal owing on the Series A Notes until
paid in full, whereupon such Distributions attributable to the CBO-1/Nomura
Collateral shall thereafter be paid to the Note B Indenture Trustee to be
applied to any accrued interest and principal owing on the Series B Notes.
(iv) Valuation and Allocation of Proceeds Upon Arm's Length Sale. Upon any
Arm's Length Sale of the Combined Collateral or the CBO REIT Stock Collateral,
whether incident to a Disposition Default or during the Deemed Sale Period, the
gross proceeds of such sale, less the actual costs of such sale, shall, subject
to the Minimum CBO-1/Nomura Collateral Value adjustment provided for in Article
VI, Section (d)(ii) below, be allocated among the Repo Purchaser, the Note A
Indenture Trustee and the Note B Indenture Trustee as follows:
(A) Within five (5) Business Days after the completion of such Arm's Length
Sale of the Combined Collateral or the CBO REIT Stock Collateral, as applicable,
and the receipt of the gross sale proceeds realized therefrom, the actual costs
of such sale shall be paid or reserved for and the Repo Purchaser shall deliver
to the Note A Indenture Trustee and the Note B Indenture Trustee a written
statement (the "Repo Purchaser's Proceeds Statement") setting forth the Repo
Purchaser's proposed allocation of the net proceeds realized from the sale of
the Combined Collateral or the CBO REIT Stock Collateral, as applicable, that
are attributable to the value of the CBO-2 Collateral, on the one hand (the
"CBO-2 Collateral Proceeds"), and the value of the CBO-1/Nomura Collateral, on
the other hand (the "CBO-1/Nomura Collateral Proceeds"), determined as of the
date of completion of the Arm's Length Sale, which shall thereafter be
distributed pursuant to the provisions of this Article VI, Section (c). Within
fifteen (15) Business Days after receipt of the Repo Purchaser's Proceeds
Statement, the Note A Indenture Trustee and the Note B Indenture Trustee shall
jointly deliver to the Repo Purchaser a written statement (the "Indenture
Trustees' Proceeds Statement") notifying the Repo Purchaser whether the
Indenture Trustees accept or dispute the Repo Purchaser's proposed valuation of
the CBO-2 Collateral and the CBO-1/Nomura Collateral and proposed determination
of the CBO-2 Collateral Proceeds and the CBO-1/Nomura Collateral Proceeds and,
if the Indenture Trustees dispute the Repo Purchaser's proposed determination of
the CBO-2 Collateral Proceeds and the CBO-1/Nomura Collateral Proceeds, setting
forth the Indenture Trustees' proposed valuation of the CBO-2 Collateral and the
CBO-1/Nomura Collateral and proposed determination of the CBO-2 Collateral
Proceeds and the CBO-1/Nomura Collateral Proceeds. If the Indenture Trustees
fail to deliver the Indenture Trustees' Proceeds Statement within such fifteen
(15) Business Day period, the Indenture Trustees shall be deemed to have
accepted the Repo Purchaser's Proceeds Statement as the correct determination of
the CBO-2 Collateral Proceeds and the CBO-1/Nomura Collateral Proceeds and shall
be irrevocably bound thereby. If the Indenture Trustees accept (or are deemed to
have accepted) the Repo Purchaser's Proceeds Statement, or if the Repo Purchaser
accepts the Indenture Trustees' Proceeds Statement, the CBO-2 Collateral
Proceeds and the CBO-1/Nomura Collateral Proceeds set forth in the accepted
statement shall thereafter be distributed pursuant to the provisions of this
Article VI, Section (c)(i) or (c)(ii), as applicable. If the Indenture Trustees
timely dispute the Repo Purchaser's determination of the CBO-2 Collateral
Proceeds and the CBO-1/Nomura Collateral Proceeds, that portion of the net sales
proceeds realized upon the sale of the Combined Collateral or the CBO REIT Stock
Collateral, as applicable, not in dispute (i.e., the smaller of the amounts
proposed by either the Repo Purchaser or the Indenture Trustees in their
respective proceeds statements as constituting the CBO-2 Collateral Proceeds and
the CBO-1/Nomura Collateral Proceeds) shall be paid to the Repo Purchaser and
the Note A Indenture Trustee (or if the Series A Notes are paid in full, the
Note B Indenture Trustee), respectively, pursuant to the provisions of Article
VI, Section (c)(i) or (c)(ii), as applicable, and the disputed amount shall be
retained in the Deemed Sale Entity and invested in a commercially reasonable
manner, and such dispute shall be resolved pursuant to the procedure set forth
in Article VI, Section (c)(iv)(B) below.
(B) (1) On or before the Effective Date of the Plan, the Repo Purchaser,
the Note A Indenture Trustee and the Note B Indenture Trustee have
agreed on a list of five (5) institutions qualified to value the Combined
Collateral and the CBO REIT Stock Collateral (each a "Qualified CMBS
Institution"), which list is attached to this Agreement as Exhibit A. In the
event that the Repo Purchaser, the Note A Indenture Trustee and the Note B
Indenture Trustee shall reasonably determine that any previously designated
Qualified CMBS Institution no longer exists independently or is not sufficiently
experienced in assets similar to the CBO-2 Collateral and the CBO-1/Nomura
Collateral (a "Disqualified CMBS Institution"), the Repo Purchaser may (but
shall not be obligated to) designate such substitute Qualified CMBS Institution
as may be reasonably acceptable to the Note A Indenture Trustee and the Note B
Indenture Trustee to act in lieu of such Disqualified CMBS Institution;
provided, however, that except as otherwise agreed to in writing by the Repo
Purchaser, the Note A Indenture Trustee and the Note B Indenture Trustee, there
shall at all times be at least three (3) designated Qualified CMBS Institutions.
(2) In the event that a dispute shall arise regarding the determination of
the respective amounts of the CBO-2 Collateral Proceeds and the CBO-1/Nomura
Collateral Proceeds realized upon an Arm's Length Sale of the Combined
Collateral or the CBO REIT Stock Collateral, as applicable, as set forth in
Article VI, Section (c)(iv)(A) above, the Repo Purchaser shall, within ten (10)
Business Days after receipt of the Indenture Trustees' Proceeds Statement
advising the Repo Purchaser of such dispute, select and advise the Indenture
Trustees in writing of the Repo Purchaser's selection of three (3) Qualified
CMBS Institutions acceptable to arbitrate the dispute as to the determination of
the CBO-2 Collateral Proceeds and the CBO-1/Nomura Collateral Proceeds. Within
ten (10) Business Days after receipt of such notification of the Repo
Purchaser's designation of such three (3) Qualified CMBS Institutions, the
Indenture Trustees shall jointly advise the Repo Purchaser, in writing, of their
selection of one (1) of such three (3) designated Qualified CMBS Institutions
(the "CMBS Appraiser") to arbitrate the dispute regarding the value of the CBO-2
Collateral and the value of the CBO-1/Nomura Collateral and to determine the
CBO-2 Collateral Proceeds allocable to the Repo Purchaser and the CBO-1/Nomura
Proceeds allocable to the Indenture Trustees as provided for in this Article VI,
Section (c); provided, however, that if the Indenture Trustees fail to notify
the Repo Purchaser of their selection of the CMBS Appraiser prior to the end of
such ten (10) Business Day period, the Repo Purchaser shall promptly thereafter
select the CMBS Appraiser from among such three 3 designated Qualified CMBS
Institutions , which selection shall be binding upon the Indenture Trustees.
(3) The CMBS Appraiser shall promptly conduct such due diligence and
investigations as such CMBS Appraiser may deem appropriate, and may consider
such factors as such CMBS Appraiser shall deem appropriate in connection with
its determination (provided such CMBS Appraiser shall consider the number and
dollar value of the loans underlying the Combined Collateral and the CBO REIT
Stock Collateral and any changes over time to such loans, including, without
limitation, the dollar amount and number of "watch list" loans, special
servicing loans, defaulted loans and loan losses underlying each of the CBO-2
Collateral and the CBO-1/Nomura Collateral and, if requested by the Repo
Purchaser, the amount of any bona-fide third party offer to purchase the CBO-2
Collateral alone, as contemplated by this Article VI, Section (f)(vi) below) and
shall, within thirty (30) days after the date of designation of the
CMBS Appraiser advise the Repo Purchaser, the Note A Indenture Trustee and
the Note B Indenture Trustee of the CMBS Appraiser's determination of the value
of the CBO-2 Collateral and the value of the CBO-1/Nomura Collateral and the
resulting determination of the CBO-2 Collateral Proceeds payable to the Repo
Purchaser and the CBO-1/Nomura Collateral Proceeds payable to the Indenture
Trustees as provided for in this Article VI, Section (c). In this regard, the
CMBS Appraiser shall ascribe a value to each rated class, and all unrated
classes, of securities constituting each of the CBO-2 Collateral and the
CBO-1/Nomura Collateral, such that the aggregate values thereof total 100% of
the gross proceeds realized from the sale of such Combined Collateral or CBO
REIT Stock Collateral, as applicable, and shall determine such values in a
manner that is internally consistent. The decision of the CMBS Appraiser as to
the determination of the CBO-2 Collateral Proceeds and the CBO-1/Nomura Proceeds
shall be final and binding on all parties, and upon such determination the
disputed proceeds amount shall, subject to the Minimum CBO-1/Nomura Collateral
Value adjustment provided for in Article VI, Section (d)(ii) below, be allocated
between the Repo Purchaser and the Indenture Trustees accordingly and
distributed pursuant to the provisions of this Article VI, Section (c)(i) or
(c)(ii), as applicable.
(4) Each of the Repo Purchaser, the Note A Indenture Trustee and the Note B
Indenture Trustee shall pay its own costs and fees, if any, in connection with
any arbitration hereunder, with the costs and expenses of the CMBS Appraiser to
be charged against the disputed proceeds before disbursement of such funds as
directed by the decision of the CMBS Appraiser pursuant to this Article VI,
Section (c)(iv) (B)(3) above.
(v) Disposition of Cash Held in Accounts. Notwithstanding anything in this
Agreement to the contrary, from and after the date of any Disposition Default
where the Repo Purchaser elects to dispose of any of the CBO-2 Collateral, the
Combined Collateral or the CBO REIT Stock Collateral, the Repo Purchaser shall
receive all Proceeds and Distributions attributable to the CBO-2 Collateral from
time to time held in the Collection Account, which shall be applied to any Repo
Obligations then remaining unpaid, and the Note A Indenture Trustee shall
receive all Proceeds and Distributions from time to time held in the New Note
Collection Account attributable to the CBO-1/Nomura Collateral, which shall be
applied to any accrued interest and principal owing on the Series A Notes until
paid in full, whereupon such Proceeds and Distributions attributable to the
CBO-1/Nomura Collateral shall thereafter be paid to the Note B Indenture Trustee
to be applied to any accrued interest and principal owing on the Series B Notes.
(d) Deemed Sale Period. The Deemed Sale Period shall commence upon a Deemed
Sale of any of the CBO-2 Collateral, the Combined Collateral or the CBO REIT
Stock Collateral, as applicable (the "Deemed Sale Collateral"), and shall
terminate upon the date of the completion of the Arm's Length Sale of such
Deemed Sale Collateral. The Repo Purchaser, the Note A Indenture Trustee and the
Note B Indenture Trustee shall have the following rights and shall be subject to
the following procedures during the Deemed Sale Period.
(i) Indenture Trustees' Right to Identify Potential Purchaser. The Repo
Purchaser shall be entitled to effect an Arm's Length Sale of the Deemed Sale
Collateral, at any time and from time to time during the Deemed Sale Period,
upon and subject to the relevant terms and conditions of this Agreement. In the
event that an Arm's Length Sale of the Deemed Sale Collateral has not been
completed prior to the earlier to occur of (x) the second anniversary of the
commencement of the Deemed Sale Period, and (y) the sixth anniversary of the
Effective Date, the Note A Indenture Trustee and the Note B Indenture Trustee,
acting jointly, shall, for a ninety (90) day period thereafter, have the right
to identify a bona-fide third-party purchaser (the "Potential Purchaser") for
the Deemed Sale Collateral, by presentment to the Repo Purchaser of a binding
written offer to purchase all of the Deemed Sale Collateral executed by the
Potential Purchaser (the "Term Sheet") setting forth in reasonable detail the
all-cash price and other terms and conditions on which the Potential Purchaser
is willing to purchase the Deemed Sale Collateral, subject to customary due
diligence and closing conditions, but excluding any financing contingency.
Within fifteen (15) Business Days of its receipt of the Term Sheet, the Repo
Purchaser shall advise the Indenture Trustees in writing (the "Term Sheet
Response") whether the Repo Purchaser accepts or rejects the Potential
Purchaser's offer to purchase, as set forth in the Term Sheet. If the Repo
Purchaser fails to deliver the Term Sheet Response within said fifteen (15)
Business Day period, the Repo Purchaser shall be deemed to have accepted the
Potential Purchaser's offer to purchase. If the Repo Purchaser accepts, or is
deemed to have accepted, the Potential Purchaser's offer to purchase as set
forth in the Term Sheet, the Repo Purchaser shall proceed to enter into a formal
agreement with the Potential Purchaser providing for an Arm's Length Sale of the
Deemed Sale Collateral on terms and conditions substantially similar to those
set forth in the Term Sheet, and shall thereafter proceed to consummate such
Arm's Length Sale of the Deemed Sale Collateral. Upon the completion of such
Arm's Length Sale of the CBO-2 Collateral, the proceeds of such sale shall be
allocated among the Repo Purchaser, the Note A Indenture Trustee and the Note B
Indenture Trustee as set forth in Article VI, Section (b)(ii) above, and the
Deemed Sale Period shall terminate. Upon completion of such Arm's Length Sale of
the Combined Collateral or the CBO REIT Stock Collateral, as applicable, the
proceeds realized from any such Arm's Length Sale shall be allocated among the
Repo Purchaser, the Note A Indenture Trustee and the Note B Indenture Trustee as
provided for in Article VI, Section (c)(ii) above, and in either case the Deemed
Sale Period shall terminate.
(ii) Determination of Minimum CBO-1/Nomura Value. If the Repo Purchaser
rejects the Potential Purchaser's offer to purchase the Deemed Sale Collateral,
as provided for in Article VI, Section (iv)(d)(i) above, the Indenture Trustees
and the Repo Purchaser shall thereupon proceed to determine the value of the
CBO-1/Nomura Collateral as of the date of the Repo Purchaser's rejection of the
Potential Purchaser's offer, pursuant to the procedures set forth in this
Article VI, Section (c) (iv) above; provided, however, that any such
determination of the value of the
CBO-1/Nomura Collateral shall assume that the value of the Deemed Sale
Collateral shall be the all-cash purchase price offered therefor by the
Potential Purchaser, as set forth in the Term Sheet. The value of the
CBO-1/Nomura Collateral, as so determined, shall constitute the minimum value
ascribable to the CBO-1/Nomura Collateral (the "Minimum CBO-1/Nomura Collateral
Value"), in connection with any determination of the value of the CBO-1/Nomura
Collateral for determining the CBO-1/Nomura Collateral Proceeds incident to any
subsequent Arm's Length Sale of the Combined Collateral or the CBO REIT Stock
Collateral. Furthermore, from and after the Repo Purchaser's rejection of the
Potential Purchaser's offer, the Repo Purchaser shall continue to be entitled to
determine the date of any subsequent Arm's Length Sale of the Deemed Sale
Collateral, and the terms and conditions of any such sale, with the net sale
proceeds realized therefrom to be divided among the Repo Purchaser, the Note A
Indenture Trustee and the Note B Indenture Trustee pursuant to the procedures
set forth in this Article VI, Section (b) (ii) or Section (c)(ii) above, as
appropriate, but subject to the Minimum CBO-1/Nomura Collateral Value adjustment
provided for herein, whereupon the Deemed Sale Period shall terminate.
(e) Indenture Trustees' Right to Receive Bid Packages. Notwithstanding
anything in this Article VI to the contrary, at any time, or from time to time,
whenever the Repo Purchaser shall engage in a solicitation of two (2) or more
third-parties with respect to their interest in or intent to purchase the CBO-2
Collateral, the Combined Collateral or the CBO REIT Stock Collateral, the Repo
Purchaser shall include the Note A Indenture Trustee and the Note B Indenture
Trustee among the potentially interested parties to whom the Repo Purchaser
shall deliver "Bid Packages" or similar requests for an expression of interest
and with whom the Repo Purchaser shall engage in discussions regarding a
possible Arm's Length Sale of the CBO-2 Collateral, the Combined Collateral or
the CBO REIT Stock Collateral, as the case may be. For purposes of any such
sale, the Note A Indenture Trustee and the Note B Indenture Trustee shall be
deemed to be potential third-party purchasers and shall be accorded the rights
and opportunities afforded any other potential third-party purchaser. The right
of the Note A Indenture Trustee and the Note B Indenture Trustee, respectively,
to bid on the CBO-2 Collateral, the Combined Collateral or the CBO REIT Stock
Collateral, as applicable, shall not be deemed to be a "right of first refusal"
or a "right of first offer", or otherwise to confer upon the Indenture Trustees
any preemptive rights or preferred status, but shall constitute an agreement
between the Repo Purchaser, on the one hand, and the Note A Indenture Trustee
and the Note B Indenture Trustee, on the other hand, to afford the Note A
Indenture Trustee and the Note B Indenture Trustee an opportunity to bid in
connection with any proposed Arm's Length Sale of the CBO-2 Collateral, the
Combined Collateral and the CBO REIT Stock Collateral, as the case may be.
Notwithstanding the foregoing, neither Indenture Trustee shall have any
obligation to bid in connection with any such proposed Arm's Length Sale and
shall only do so in their sole discretion.
(f) General Provisions. In connection with any Arm's Length Sale or Deemed
Sale of the CBO-2 Collateral, the Combined Collateral or the CBO REIT Stock
Collateral, the following shall apply:
(i) Each of the Repo Purchaser, the Note A Indenture Trustee and the Note B
Indenture Trustee will release and remove its security interest (a) in the CBO-2
Collateral in connection with an Arm's Length Sale or Deemed Sale of the CBO-2
Collateral, (b) in the CBO-2 Collateral and the CBO-1/Nomura Collateral in
connection with an Arm's Length Sale or Deemed Sale of the Combined Collateral,
and (c) in the CBO-2 Collateral, the CBO-1/Nomura Collateral, and the CBO REIT
Stock Collateral in
connection with any Arm's-Length Sale or Deemed Sale of the CBO REIT Stock
Collateral (in each case subject to the Repo Purchaser's and such Indenture
Trustee's interest in and right to receive its applicable share of the Proceeds
realized from any such Arm's Length Sale or Deemed Sale, as hereinabove set
forth this Article VI). Notwithstanding the foregoing, although the respective
liens of each of the Repo Purchaser, the Note A Indenture Trustee and the Note B
Indenture Trustee in the CBO-2 Collateral and the CBO-1/Nomura Collateral shall
be released in connection with any Deemed Sale of the CBO-2 Collateral, the
Combined Collateral or the CBO REIT Stock Collateral, as the case may be,
interest shall continue to accrue on the underlying debt obligations evidenced
by Repo Obligations and the New Debt, as applicable, until the completion of the
Arm's Length Sale of such collateral in connection with the termination of the
Deemed Sale Period and the distribution of the net sale proceeds thereof
pursuant to the terms of this Article VI above.
(ii) The Collateral Agent is hereby authorized to act on behalf of the Repo
Purchaser, the Note A Indenture Trustee and the Note B Indenture Trustee in each
case to release the CBO REIT Stock Collateral from the ownership interests of
the Repo Purchaser and the CBO-2 Collateral, the Combined Collateral and/or the
CBO REIT Stock Collateral, as applicable, from the liens and security interests
of the Repo Purchaser and the Indenture Trustees, as contemplated in this
Agreement, and is hereby designated as attorney in fact for each of the Repo
Purchaser, the Note A Indenture Trustee and the Note B Indenture Trustee (with
each such power of attorney coupled with an interest and, therefore,
irrevocable) to execute and deliver on their behalf any document, agreement or
instrument to implement the foregoing.
(iii) Notwithstanding anything in this Agreement or otherwise to the
contrary, and without in any way limiting the rights of any party under the last
paragraph of Article VI, Section (c)(ii) above, at any time and from time to
time during the Deemed Sale Period, the Repo Purchaser shall be free to offer to
acquire the Indenture Trustees' interest in the CBO-2 Collateral, the Combined
Collateral or the CBO REIT Stock Collateral, as applicable, and the Indenture
Trustees shall be free to offer to acquire the Repo Purchaser's interest in the
CBO-2 Collateral, the Combined Collateral or the CBO REIT Stock Collateral, as
applicable, in each case on such terms and conditions as may be agreed upon by
such parties. In this regard, (a) any such offer to purchase shall be optional,
and there shall be no obligation on the part of the party receiving any such
offer to accept such offer, and (b) upon the consummation of such purchase and
sale, the Deemed Sale Period shall terminate as to such assets sold pursuant
thereto.
(iv) In connection with any Deemed Sale of the CBO-2 Collateral, the
Combined Collateral or the CBO REIT Stock Collateral, it is understood and
agreed by the parties that, in determining the amount of unpaid Repo Obligations
or outstanding obligations on account of the Series A Notes and the Series B
Notes for purposes of determining the amount of net sale proceeds realized from
any subsequent Arm's Length sale of such collateral attributable to the CBO-2
Collateral and attributable to the CBO-1/Nomura Collateral which shall be
payable to each of the Repo Purchaser, the Note A Indenture Trustee or the Note
B Indenture Trustee on account of such obligations, none of such obligations
shall be reduced by the amount of any "credit bid" made by the
Collateral Agent in connection with the Deemed Sale of the CBO-2
Collateral, the Combined Collateral or the CBO REIT Stock Collateral, as
applicable, in determining the deficiency claim retained by each of the Repo
Purchaser, the Note A Indenture Trustee or the Note B Indenture Trustee against
CMI after such Deemed Sale in accordance with the provisions of Article VII
hereof.
(v) Notwithstanding anything in this Agreement or otherwise to the
contrary, but subject to the provisions of Article VI, Section (f)(vi) below,
each and every sale, transfer or other disposition, including, without
limitation, by an Arm's Length Sale or a Deemed Sale, of the CBO-2 Collateral,
the Combined Collateral or the CBO REIT Stock Collateral by the Repo Purchaser
(or by the Collateral Agent on behalf or for the benefit of the Repo Purchaser)
shall be undertaken and effectuated in all respects in a commercially reasonable
manner.
(vi) Notwithstanding anything in this Agreement or otherwise to the
contrary, the decision by the Repo Purchaser as to which assets (the CBO-2
Collateral, the Combined Collateral, or the CBO REIT Stock Collateral) to
include in any Arm's Length Sale or Deemed Sale shall be made on a commercially
reasonable basis, as determined on all of the facts and circumstances existing
at that time, subject, however, to the following: (aa) for any Arm's Length
Sale, if the CBO REIT Stock Collateral is sold, or if the Combined Collateral or
CBO-2 Collateral is sold to a single REIT so as to preserve the REIT attributes
of such assets, the Repo Purchaser's decision as to which assets to sell shall
be deemed to have been commercially reasonable; (bb) any Arm's Length Sale of
either (x) the CBO-2 Collateral alone, or (y) of the Combined Collateral in a
manner other than that described in clause (aa) above, shall not be deemed to
be, per se, commercially unreasonable, but the commercial reasonableness of the
decision regarding which assets to sell in such Arm's Length Sale shall be
determined on all of the relevant facts and circumstances existing at the time
of such sale; (cc) if the Repo Purchaser receives an unsolicited, all-cash Arm's
Length Sale offer to buy the CBO-2 Collateral or to buy the Combined Collateral
without preserving the REIT attributes of such assets, the Repo Purchaser shall
solicit such offeror to submit an all-cash bid for the purchase of the CBO REIT
Stock Collateral or the Combined Collateral in a manner that preserves the REIT
attributes associated with such assets ("solicited offer"). If such solicited
offer is made and accepted, Subsection (aa) hereinabove shall apply as to the
decision to sell the assets selected for sale. If the offeror makes such a
solicited offer but the Repo Purchaser nevertheless accepts the original
unsolicited offer, Subsection (bb) hereinabove shall apply to such decision to
sell the assets selected for sale. If the offeror elects not to make a timely
solicited offer, and the Repo Purchaser elects to accept the offeror's original
bid, Subsection (bb) hereinabove shall apply as to the decision to sell the
assets selected for sale; (dd) the commercial reasonableness of the failure by
the Repo Purchaser to solicit any additional Arm's Length Sale bids in
connection with its decision to sell any of the CBO-2 Collateral, the Combined
Collateral or the CBO REIT Stock Collateral shall be judged under the standard
set forth in Subsection (bb) hereinabove; (ee) if an Arm's Length Sale offer is
made by the Repo Purchaser to a potential buyer for the sale of any of the CBO-2
Collateral, the Combined Collateral or the CBO REIT Stock Collateral,
Subsections (aa), (bb), and (dd) hereinabove, as appropriate, shall apply; and
(ff) with respect to any Deemed Sale, the determination of whether or not the
decision with respect
to which of the CBO-2 Collateral, the Combined Collateral and the CBO REIT
Stock Collateral to include in such Deemed Sale was commercially reasonable will
be judged based on all the relevant facts and circumstances existing at the
time, and no such decision will be presumed to have been either commercially
reasonably or commercially unreasonable by reason of any provision contained in
this Agreement.
ARTICLE VII
CREDIT BID PROCEDURES
DETERMINATION OF DEFICIENCY CLAIMS
In connection with any disposition of the CBO REIT Stock Collateral
incident to a Disposition Default that is undertaken by the Repo Purchaser
pursuant to the Repo Agreement (a "Repo Disposition"), the Repo Purchaser and
CMI have, pursuant to the terms and conditions of the Repo Agreement, agreed on
the procedures that will be followed in order to determine the value of the CBO
REIT Stock Collateral, as well as the value of the respective interests of the
Repo Purchaser, the Note A Indenture Trustee and the Note B Indenture Trustee in
the CBO-2 Collateral and the CBO-1/Nomura Collateral held by CBO REIT, which
valuations will be applicable for the purpose of determining any deficiency
claims (or, where applicable, any obligation to account for any "surplus value"
in the CBO REIT Stock Collateral) arising on account of such disposition of the
CBO REIT Stock Collateral pursuant to the Repo Agreement that the Repo
Purchaser, the Note A Indenture Trustee or the Note B Indenture Trustee, as the
case may be, shall then and thereafter have against CMI on account of the Repo
Obligations, the then outstanding obligations on account of the Series A Notes
and the then outstanding obligations on account of the Series B Notes.
In addition to the determination of any deficiency claims against CMI of
each of the Repo Purchaser, the Note A Indenture Trustee and the Note B
Indenture Trustee (or where applicable, any obligation to account for "surplus
value") arising upon a disposition of the CBO REIT Stock Collateral pursuant to
the Repo Agreement, the Repo Purchaser, the Note A Indenture Trustee and the
Note B Indenture Trustee have agreed with the Debtors, pursuant to that certain
Foreclosure/Transfer Agreement dated as of the date hereof (the "Foreclosure
Agreement") on procedures to be followed in order to determine the value of
their respective interests in the Combined Collateral and, to the extent
disposed of by foreclosure on their respective liens and security interests
(rather than pursuant to the procedures set forth in the Repo Agreement), the
CBO REIT Stock Collateral, in connection with a disposition of such assets upon
the occurrence of a Disposition Default for the purpose of determining any
deficiency claims (or, where applicable, any obligation to account for "surplus
value") that the Repo Purchaser, the Note A Indenture Trustee or the Note B
Indenture Trustee, as the case may be, shall then and thereafter have against
CMI on account of the Repo Obligations, the then outstanding obligations on
account of the Series A Notes and the then outstanding obligations on account of
the Series B Notes.
In this regard, the parties hereto acknowledge and agree that,
notwithstanding the provisions for a Repo Disposition pursuant to the Repo
Agreement or for determining any deficiency claims under the Foreclosure
Agreement, in the event that the Repo Purchaser, or the Collateral Agent acting
on behalf of the Repo Purchaser, elects to realize upon the CBO-2 Collateral,
the Combined Collateral or the CBO REIT Stock Collateral, as applicable, upon
the occurrence of a Disposition Default by means of a Deemed Sale of the
applicable assets, and in connection therewith determines (x) that neither the
Repo Disposition mechanism provided for under the Repo Agreement nor the
Foreclosure Agreement is applicable to such disposition, (y) not to utilize the
procedures of the Foreclosure Agreement or (z) that the provisions of the Repo
Agreement or the Foreclosure Agreement relative to a disposition of the Combined
Collateral or the CBO REIT Stock Collateral, as applicable, shall, for any
reason, be or become unenforceable against CMI for purposes of determining any
deficiency claims (or, where applicable, any obligation to account for "surplus
value") that the Repo Purchaser, the Note A Indenture Trustee or the Note B
Indenture Trustee shall then and thereafter have against CMI on account of the
Repo Obligations, the then outstanding obligations on account of the Series A
Notes and the then outstanding obligations on account of the Series B Notes,
then the parties hereto agree that the following procedures shall be utilized in
order to effectuate the Deemed Sale of the CBO-2 Collateral, the Combined
Collateral or the CBO REIT Stock Collateral, as applicable, and to determine the
values of their respective interests in the CBO-2 Collateral, the Combined
Collateral or the CBO REIT Stock Collateral, as applicable, for the purpose of
determining their respective deficiency claims then and thereafter against CMI
(or, where applicable, any obligation to account for "surplus value").
(a) Credit Bid Procedures. In the event that the CBO-2 Collateral, the
Combined Collateral or the CBO REIT Stock Collateral, as applicable, is to be
disposed of by means of a Deemed Sale upon the occurrence of a Disposition
Default (and not pursuant to the terms and conditions applicable to a Repo
Disposition under the Repo Agreement or the procedures applicable under the
Foreclosure Agreement), the Collateral Agent shall notice the sale of the CBO-2
Collateral, the Combined Collateral or the CBO REIT Stock Collateral, as the
case may be, in accordance with and as required by the provisions of the Uniform
Commercial Code (if and to the extent applicable), on behalf of the Repo
Purchaser, the Note A Indenture Trustee and the Note B Indenture Trustee, free
and clear of all liens. Upon any such sale, the Collateral Agent shall be
authorized to "credit bid" so much of the unpaid Repo Obligations and the then
outstanding obligations on account of the Series A Notes and the Series B Notes
(including all of such aggregate obligations then outstanding) as directed by
the Repo Purchaser after consultation with the Note A Indenture Trustee and the
Note B Indenture Trustee, in an effort to secure title to and ownership of the
CBO-2 Collateral, the Combined Collateral or the CBO REIT Stock Collateral, as
the case may be, absent a third-party bid for such assets satisfactory to the
Repo Purchaser. The Collateral Agent shall otherwise conduct such sale and
bidding process as the Collateral Agent may be authorized and directed in any
written direction actually received by the Collateral Agent from the Repo
Purchaser, after consultation with the Note A Indenture Trustee and the Note B
Indenture Trustee. To the extent that the Collateral Agent, acting on behalf of
the Repo Purchaser, the Note A Indenture Trustee and the Note B Indenture
Trustee pursuant to the terms hereof, is the
successful bidder at any such sale of the CBO-2 Collateral, the Combined
Collateral or the CBO REIT Stock Collateral, as applicable, such collateral and
the Proceeds thereof, including any Distributions thereon, shall be held and
disposed of in accordance with the applicable provisions of Article VI above.
(b) Determination of Deficiency Claims. In connection with any disposition
of the CBO-2 Collateral, the Combined Collateral or the CBO REIT Stock
Collateral incident to a Disposition Default where any resulting deficiency
claim to be held against CMI by each of the Repo Purchaser, the Note A Indenture
Trustee and the Note B Indenture Trustee on account of any unpaid Repo
Obligations and obligations then outstanding on account of the Series A Notes
and the Series B Notes is not determined pursuant to the terms and conditions
applicable to a Repo Disposition under the Repo Agreement or the provisions
applicable under the Foreclosure Agreement, the Repo Purchaser, the Note A
Indenture Trustee and the Note B Indenture Trustee hereby agree that the
following terms and procedures will be applicable in order to determine the
values of their respective interests in the CBO-2 Collateral, the Combined
Collateral or the CBO REIT Stock Collateral, as the case may be, for the purpose
of allocating debt obligations bid at foreclosure in connection with determining
any deficiency claims (or where applicable, any obligation to account for
"surplus value") that the Repo Purchaser, the Note A Indenture Trustee or the
Note B Indenture Trustee, as appropriate, shall then and thereafter have against
CMI on account of any unpaid Repo Obligations, the then outstanding obligations
on account of the Series A Notes and the then outstanding obligations on account
of the Series B Notes:
(i) Arm's Length Sale. In the event that the CBO-2 Collateral, the Combined
Collateral or the CBO REIT Stock Collateral, as the case may be, is disposed of
by means of an Arm's Length Sale to any buyer other than the Indenture Trustees
upon the occurrence of a Disposition Default, the proceeds of such sale shall be
allocated among the Repo Purchaser, the Note A Indenture Trustee and the Note B
Indenture Trustee as provided for in Article VI, Section (b)(i) or Section
(c)(i) above, as applicable, and the value of the interests of each of the Repo
Purchaser, the Note A Indenture Trustee and the Note B Indenture Trustee in such
disposed collateral for the purpose of determining any deficiency claims (or,
where applicable, any obligation to account for "surplus value") any of the Repo
Purchaser, the Note A Indenture Trustee or the Note B Indenture Trustee shall
then and thereafter have against CMI shall be equal to the actual cash proceeds
received by each of the Repo Purchaser, the Note A Indenture Trustee and the
Note B Indenture Trustee resulting from such sale.
(ii) Deemed Sale. In the event that the CBO-2 Collateral, the Combined
Collateral or the CBO REIT Stock Collateral, as applicable, is disposed of by
means of a Deemed Sale upon the occurrence of a Disposition Default, wherein the
Collateral Agent "credit bids" all or any portion of the then unpaid amount of
the Repo Obligations and the then outstanding obligations on account of the
Series A Notes and the Series B Notes, the aggregate amount of such obligations
so "credit bid" by the Collateral Agent in order to effect the Deemed Sale of
the CBO-2 Collateral, the Combined Collateral, or the CBO REIT Stock Collateral,
as the case may be, shall be allocated in the following manner among the unpaid
Repo Obligations owing to the Repo Purchaser,
the outstanding obligations on account of the Series A Notes and the
outstanding obligations on account of the Series B Notes, solely for purposes of
determining the deficiency claim (or, where applicable, any obligation to
account for "surplus value") that each of the Repo Purchaser, the Note A
Indenture Trustee and the Note B Indenture Trustee shall then and thereafter
have against CMI on account of the Repo Obligations and the outstanding
obligations on account of the Series A Notes and the Series B Notes:
(A) CBO-2 Collateral. In connection with any Deemed Sale of the CBO-2
Collateral effectuated by means of an actual foreclosure sale where the
Collateral Agent successfully "credit bids" for the CBO-2 Collateral, the
aggregate amount of such "credit bid" shall be allocated among the unpaid Repo
Obligations, the outstanding obligations evidenced by the Series A Notes and the
outstanding obligations evidenced by the Series B Notes based upon the amounts
of each of such debt obligations outstanding at the date of the Deemed Sale of
the CBO-2 Collateral, on the one hand, relative to the total amount of such debt
obligations then outstanding, on the other hand; provided, however, that the
amount of the obligations then deemed outstanding on account of the Series A
Notes and the Series B Notes shall be reduced by any Proceeds previously
actually realized and applied on account of the Series A Notes and the Series B
Notes from a disposition of all or part of the Miscellaneous Collateral or, if
no such disposition of all or part of the Miscellaneous Collateral has occurred
prior to the date of determination of the outstanding debt obligations, by the
net book value for such assets as reflected on the books and records of CMI for
the most recently concluded reporting period. Upon the allocation of the
aggregate obligations "credit bid" by the Collateral Agent in connection with
the Deemed Sale of the CBO-2 Collateral, as hereinabove provided, the deficiency
claim of each of the Repo Purchaser, the Note A Indenture Trustee and the Note B
Indenture Trustee against CMI arising on account of such Deemed Sale shall be
the difference, in each case, between the amount of such "credit bid" allocated
to the Repo Obligations or the outstanding obligations evidenced by the Series A
Notes and the Series B Notes, respectively, on the one hand, and the unpaid
balance of the Repo Obligations and the outstanding obligations evidenced by the
Series A Notes and the Series B Notes, respectively, on the other hand, as of
the date of such Deemed Sale. Anything herein to the contrary notwithstanding,
each of the Note A Indenture Trustee and the Note B Indenture Trustee may elect
not to participate in the "credit bid" procedure for a Deemed Sale of the CBO-2
Collateral by written notice to the Repo Purchaser and the Collateral Agent
given not later than ten (10) Business Days prior to the date of the actual
foreclosure sale of the CBO-2 Collateral, whereupon such Indenture Trustee shall
retain its full deficiency claim against CMI on account of the outstanding
obligations evidenced by the applicable Notes without regard to the Deemed Sale
of the CBO-2 Collateral, shall not have any beneficial ownership interest in the
Deemed Sale Entity or the CBO-2 Collateral, shall continue to be obligated to
release the CBO-2 Collateral from such Indenture Trustee's security interest
therein, as required by Article VI, Section (b)(ii) above, and shall forfeit any
and all rights to any Proceeds thereafter realized on the CBO-2 Collateral to
which such Indenture Trustee would otherwise be entitled pursuant to the
provisions of Article VI, Section (b)(ii) above.
(B) Combined Collateral or CBO REIT Stock Collateral. In connection with
the effectuation of a Deemed Sale of the Combined Collateral or the
CBO REIT Stock Collateral, as applicable, by means of a disposition other
than pursuant to the terms and conditions applicable to a Repo Disposition under
the Repo Agreement or the procedures applicable under the Foreclosure Agreement
where the Collateral Agent successfully "credit bids" for such assets on behalf
of the Repo Purchaser and the Indenture Trustees, the aggregate amount of such
"credit bid" shall be allocated among the outstanding Repo Obligations and the
outstanding obligations evidenced by the Series A Notes and the Series B Notes,
based upon the relative value of the CBO-2 Collateral, on the one hand, and the
CBO-1/Nomura Collateral, on the other hand, as determined pursuant to the terms
and conditions of Article VI, Section (c)(iv) above, without any adjustment for
the value of or Proceeds realized upon the disposition of all or part of the
Miscellaneous Collateral. Upon the allocation of the aggregate obligations
"credit bid" by the Collateral Agent in connection with the Deemed Sale of the
Combined Collateral or the CBO REIT Stock Collateral, as hereinabove provided,
the deficiency claim of each of the Repo Purchaser, the Note A Indenture Trustee
and the Note B Indenture Trustee, against CMI arising on account of such Deemed
Sale shall be in an amount equal to the difference between the amount of such
"credit bid" allocated to the Repo Obligations or the outstanding obligations
evidenced by the Series A Notes and the Series B Notes, on the one hand, and the
unpaid balance of the Repo Obligations and the outstanding obligations evidenced
by the Series A Notes and the Series B Notes as of the date of such Deemed Sale,
on the other hand.
(c) Repo Disposition of CBO REIT Stock Collateral. Whenever in this Article
VII or elsewhere in this Agreement reference is made to a Repo Disposition under
the Repo Agreement relative to the CBO REIT Stock Collateral, such reference is
to any "taking" or retention of the CBO REIT Stock Collateral by the Repo
Purchaser, as owner thereof, to the exclusion or termination of any rights or
entitlements of CMI with respect to the CBO REIT Stock Collateral, pursuant to
the Repo Agreement. In connection with any such Repo Disposition, the Repo
Agreement sets forth a mechanism to determine the valuation of the CBO REIT
Stock Collateral and the respective interests of each of the Repo Purchaser and
the Note A Indenture Trustee and the Note B Indenture Trustee therein for
purposes of determining the deficiency claim (or, where applicable, any
obligation to account for "surplus value") that each of the Repo Purchaser, the
Note A Indenture Trustee and the Note B Indenture Trustee shall then and
thereafter have against CMI on account of the Repo Obligations and the
outstanding obligations on account of the Series A Notes and the Series B Notes.
Specifically, the Repo Agreement provides that, in the first instance, the
Repo Purchaser may, at its option, deliver to CMI a written statement setting
forth a proposal as to the Repo Purchaser's determination of the market value of
the CBO REIT Stock Collateral and the CBO-1/Nomura Collateral, which
determination is to be made after consultation between the Repo Purchaser and
the Indenture Trustees as to such values. In this regard, the Repo Purchaser,
the Note A Indenture Trustee and the Note B Indenture Trustee hereby agree that
in the event that the Repo Purchaser elects to seek a determination of the then
market value of the CBO REIT Stock Collateral and the CBO-1/Nomura Collateral by
agreement with CMI pursuant to the provisions of the Repo Agreement, the Repo
Purchaser, the Note A Indenture Trustee and the Note B Indenture Trustee shall,
in good faith, proceed to negotiate a mutually acceptable valuation of the
CBO REIT Stock Collateral, the CBO-1/Nomura and the CBO-2 Collateral. In
the event the Repo Purchaser and the Indenture Trustees are able to reach
agreement as to the market value of such collateral within a reasonable period
of time, the Repo Purchaser shall be authorized to proffer such valuations to
CMI in an effort to reach consensual agreement with CMI as to the market value
of the CBO REIT Stock Collateral and the CBO-1/Nomura Collateral in connection
with a Repo Disposition pursuant to the Repo Agreement. In the event the Repo
Purchaser and the Indenture Trustees are unable to reach agreement on such
valuations within a reasonable time, the Repo Purchaser shall forego its efforts
to reach consensual agreement with CMI as to the market value of the CBO REIT
Stock Collateral and the CBO-1/Nomura Collateral, and the Repo Purchaser shall,
instead, proceed to determine the market value of such collateral by the
appraisal methodology provided therefore in the Repo Agreement, subject to the
following procedures hereby agreed to by the Repo Purchaser, the Note A
Indenture Trustee and the Note B Indenture Trustee.
The Repo Agreement sets forth a procedure whereby the Repo Purchaser shall
select and advise CMI in writing of its selection of three (3) then designated
Qualified CMBS Institutions to determine the valuation of the CBO REIT Stock
Collateral and the valuation of the CBO-2 Collateral and the CBO-1/Nomura
Collateral held by CBO REIT. Upon receipt of such notification of the
designation of such three (3) Qualified CMBS Institutions selected by the Repo
Purchaser, CMI is to advise the Repo Purchaser, in writing, of its selection of
one (1) of such three (3) designated Qualified CMBS Institutions, who shall then
determine the valuation of the CBO REIT Stock Collateral, the CBO-2 Collateral
and the CBO-1/Nomura Collateral. In connection with such determination of the
valuation of the CBO REIT Stock Collateral and of the respective interests of
the Repo Purchaser in the CBO-2 Collateral and the Note A Indenture Trustee and
the Note B Indenture Trustee in the CBO-1/Nomura Collateral and the selection of
the three (3) Qualified CMBS Institutions for submission to CMI, the Repo
Purchaser, the Note A Indenture Trustee and the Note B Indenture Trustee hereby
agree as follows:
(i) Selection of Qualified CMBS Institutions. In connection with the
selection of the three (3) Qualified CMBS Institutions for submission to CMI as
part of the Repo Disposition provided for in the Repo Agreement, the Repo
Purchaser shall first advise the Note A Indenture Trustee and the Note B
Indenture Trustee, in writing, of the three (3) Qualified CMBS Institutions that
the Repo Purchaser proposes to proffer to CMI for the approval of the Indenture
Trustees. Within five (5) Business Days after receipt of such written
designation of the three (3) proposed Qualified CMBS Institutions, the Note A
Indenture Trustee and the Note B Indenture Trustee shall jointly advise the Repo
Purchaser, in writing, as to whether the Indenture Trustees accept or object to
one or more of such designated Qualified CMBS Institutions. If the Indenture
Trustees fail to deliver such written response within said five (5) Business Day
period, the Indenture Trustees shall be deemed to have accepted the Repo
Purchaser's designation of such three (3) Qualified CMBS Institutions. If the
Indenture Trustees timely object to one or more of the three (3) Qualified CMBS
Institutions proposed by the Repo Purchaser, the Repo Purchaser, the Note A
Indenture Trustee and the Note B Indenture Trustee shall, in good faith, proceed
to engage in discussions to arrive at a mutually agreed upon three (3) Qualified
CMBS Institutions for submission to CMI;
provided, however, that in the event the Repo Purchaser, the Note A
Indenture Trustee and the Note B Indenture Trustee are unable to reach agreement
on such three (3) Qualified CMBS Institutions within three (3) Business Days of
the commencement of such discussions, the Repo Purchaser shall designate two (2)
Qualified CMBS Institutions and the Note A Indenture Trustee and the Note B
Indenture Trustee, jointly, shall designate one (1) Qualified CMBS Institution
and the resulting list of three (3) Qualified CMBS institutions shall be
submitted to CMI for the selection of the one (1) Qualified CMBS Institution
that shall thereupon proceed to determine the value of the CBO REIT Stock
Collateral and the CBO-2 Collateral and the CBO-1/Nomura Collateral, as provided
for in the Repo Agreement, for purposes of determining the deficiency claim (or,
where applicable, any obligation to account for "surplus value") that each of
the Repo Purchaser, the Note A Indenture Trustee and the Note B Indenture
Trustee shall then and thereafter have against CMI on account of the Repo
Obligations and the outstanding obligations on account of the Series A Notes and
the Series B Notes.
(ii) Agreement on Determination of Deficiency Claims. In connection with
any Repo Disposition undertaken by the Repo Purchaser pursuant to the terms and
conditions of the Repo Agreement where the value of the CBO REIT Stock
Collateral, the value of the Repo Purchaser's interest in the CBO-2 Collateral,
and the value of the Indenture Trustees' interest in the CBO-1/Nomura Collateral
are determined either consensually by the Repo Purchaser and CMI pursuant to the
second paragraph of this Article VII, Section (c), or by the Qualified CMBS
Institution selected by CMI as set forth in this Article VII, Section (c)(i)
above, the Repo Purchaser, the Note A Indenture Trustee and the Note B Indenture
Trustee agree that such determinations of value will be binding on each of the
Repo Purchaser, the Note A Indenture Trustee and the Note B Indenture Trustee
for the purpose of determining each party's deficiency claim against CMI
resulting from such Repo Disposition; that is, the deficiency claim of each of
the Repo Purchaser, the Note A Indenture Trustee and the Note B Indenture
Trustee against CMI arising on account of such Repo Disposition shall be the
difference in each case between the value allocated to each of the CBO-2
Collateral and the CBO-1/Nomura Collateral, on the one hand, and the unpaid Repo
Obligations or the outstanding obligations evidenced by the Series A Notes and
the Series B Notes, as applicable, on the other hand, as of the date of such
Repo Disposition.
(iii) Release of Liens and Exchange for Beneficial Interest in Deemed Sale
Entity. Upon the determination of the value of the Repo Purchaser's interest in
the CBO-2 Collateral and the Indenture Trustees' interest in the CBO-1/Nomura
Collateral incident to a Repo Disposition under the Repo Agreement, as
referenced in this Article VII, Section (c), the Repo Purchaser, the Note A
Indenture Trustee and the Note B Indenture Trustee hereby agree that the Repo
Purchaser shall pay to the Indenture Trustees cash in an amount equal to the
lesser of (x) the value of the CBO-1/Nomura Collateral as so determined and (y)
the aggregate obligations then outstanding evidenced by the Series A Notes and
the Series B Notes, as consideration for the release and removal of all of the
respective liens and security interests of (or for the benefit of) the Note A
Indenture Trustee and the Note B Indenture Trustee in and on the CBO REIT Stock
Collateral, whereupon the Indenture Trustees shall remit such cash payment to
the Repo Purchaser in consideration for their resulting beneficial ownership
interest in the Deemed Sale
Entity acquiring the CBO REIT Stock Collateral free and clear of all liens
and security interests of the Repo Purchaser, the Note A Indenture Trustee and
the Note B Indenture Trustee, as provided in Article VI hereof.
ARTICLE VIII
REPO PURCHASER COVENANTS
Notwithstanding anything to the contrary in this Agreement, the Repo
Agreement, the RP Security Instruments, or otherwise, the Repo Purchaser agrees
as follows:
(a) Special Servicing Rights. In the event that the Repo Purchaser shall
become entitled to appoint and/or direct the actions of each Person (a "Special
Servicer") that will exercise all special servicing and related control rights
(the "Special Servicing Rights") with respect to all mortgage loans underlying
the CBO-2 Collateral and the CBO-1/Nomura Collateral, the Repo Purchaser shall
not enter into any agreement or arrangement with any such Special Servicer that
does not terminate at such time as either Indenture Trustee, or the Indenture
Trustees jointly, on behalf of the respective Noteholders, succeed to the Repo
Purchaser's rights to appoint and direct such Special Servicer.
(b) Hypothecation of CBO REIT Stock Collateral. The Repo Purchaser shall
not sell, transfer, pledge, hypothecate or otherwise dispose of the CBO-2
Collateral, the Combined Collateral or the CBO REIT Stock Collateral except in
connection with (i) a Permitted Refinancing, (ii) any sale by the Repo Purchaser
(or any Beneficial Purchaser) of all or any portion of (or interest in) the Repo
Obligations, subject to the terms and conditions of this Agreement, or (iii) as
otherwise provided in this Agreement, so long as any obligations shall remain
outstanding under the Series A Notes and the Series B Notes, without the prior
written consent of the Indenture Trustees in each instance, whether during the
Deemed Sale Period or otherwise.
ARTICLE IX
MISCELLANEOUS
(a) Entire Agreement. This Agreement contains the entire agreement among
the parties hereto with respect to the subject matter hereof, and may be
modified only by an instrument in writing signed by all parties hereto.
(b) No Waiver. Any party's failure to exercise any right hereunder shall
not be construed as a waiver of the right to exercise the same or any other
right at any other time and from time to time thereafter, and such rights shall
be cumulative and not exclusive. The knowledge by any party of any breach or
other non-observance by any other party of any term of this Agreement shall not
constitute knowledge or a waiver thereof by any other party.
(c) Headings. Article and Section headings used in this Agreement are for
convenience only, and shall not be deemed to constitute a part of this Agreement
or affect the meaning of any provision of this Agreement.
(d) Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of New York. 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.
(e) Binding Effect. This Agreement shall be binding upon and inure to the
benefit of parties hereto and their respective successors and permitted assigns.
Without in any way limiting the generality of the foregoing and notwithstanding
anything herein to the contrary, all of the agreements contained herein by the
Note A Indenture Trustee and the Note B Indenture Trustee shall be binding upon
all current and all subsequent holders of the Series A Notes and the Series B
Notes.
(f) No Third Beneficiary. Nothing in this Agreement, express or implied,
shall give to CMI and its affiliates or any other Person which is not a party to
this Agreement and their respective successors and assigns, any benefit or any
legal or equitable right, power, remedy or claim under this Agreement.
(g) Consent to Jurisdiction. Any legal action or proceeding brought by any
of the parties to this Agreement with respect to the subject matter hereof,
including without limitation any lawsuit by the Note A Indenture Trustee, the
Note B Indenture Trustee or any Noteholders against the Repo Purchaser on
account of any purported breach of its obligations under this Agreement, the
Security Agreement, the Repo Agreement, the RP Security Instruments or any of
the transactions thereunder, or otherwise, shall only be brought either in the
courts of the State of New York located in the Borough of Manhattan or in the
United States District Court for the Southern District of New York. Each of the
parties hereto hereby expressly and irrevocably accepts and consents to the
subject matter hereof for itself, and in respect of its properties, generally
and unconditionally, to the jurisdiction of the aforesaid courts in any such
legal action or proceeding. Each of the parties hereto hereby irrevocably
waives, in connection with any such action or proceeding, any objection to such
courts' exercise of such jurisdiction, including, without limitation, any
objection to personal jurisdiction, improper venue or forum non conveniens and
irrevocably consents to the service of process in any such action or proceeding
by delivery to the addresses and in the manner set forth in Section (i) of this
Article IX.
(h) No Conflict. In the event of any conflict or inconsistency between the
provisions of this Agreement, on the one hand, and the provisions of any of the
Security Documents, the Note A Indenture, the Note B Indenture, and the Repo
Agreement on the other hand, the provisions of this Agreement shall govern and
control as between or among any two or more of the parties hereto.
(i) Notices. All notices, requests and other communications pursuant to
this Agreement shall be in writing, by letter (delivered by hand or commercial
messenger service or sent by certified or registered mail, return receipt
requested), addressed to each party hereto as follows, or to such other person
and at such other place as each such party may from time to time designate in a
notice given in accordance with the provisions of this Subsection (i):
(i) If to the Repo Purchaser
Xxxxxxx Xxxxx International (Acting through its
Agent, Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated)
c/o Merrill Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated
0 Xxxxx Xxxxxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxx X. Xxxxx
with copies to:
Deutsche Bank AG, New York Branch
c/o Deutsche Banc Alex. Xxxxx Inc.
00 Xxxx 00xx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Messrs. Xxx X. Xxxxxxx and
Xxxx X. Xxxxxxxx
and to
Wachtell, Lipton, Xxxxx & Xxxx
00 Xxxx 00xx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxxx X. Xxxxxx, Esq.
and to
Xxxxx & Xxxx, L.L.P.
Xxx Xxxxx Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxxxx Xxxxxxxx, Esq.
Xxxxxxx X. Xxxxxxx, Esq.
(ii) If to the Note A Indenture Trustee:
Xxxxx Fargo Bank Minnesota, National Association
Sixth and Marquette; MAC X0000-000
Xxxxxxxxxxx, XX 00000
Attention: Corporate Trust Services
with copies to:
Pillsbury Winthrop LLP
Xxx Xxxxxxx Xxxx Xxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxxx X. Xxxxxxx, Esq.
(iii) If to the Note B Indenture Trustee:
Xxxxx Fargo Bank Minnesota, National Association
Sixth and Marquette; MAC X0000-000
Xxxxxxxxxxx, XX 00000
Attention: Corporate Trust Services
with copies to:
Pillsbury Winthrop LLP
Xxx Xxxxxxx Xxxx Xxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxxx X. Xxxxxxx, Esq.
(iv) If to the Collateral Agent:
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated
Global Asset Lending and Finance Operations
000 Xxxxxx Xxxxxx
Xxxxxx Xxxx, XX 00000
Attention: Xxxx Xxxxxxx
with copies to:
Xxxxx & Wood, L.L.P.
Xxx Xxxxx Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxxxx Xxxxxxxx, Esq.
Xxxxxxx X. Xxxxxxx, Esq.
Any notice, request or communication hereunder shall be deemed to have been
given on the day on which it is delivered by hand or such commercial messenger
service to such party at its address specified above, or, if sent by certified
or registered mail, return receipt requested, on the third Business Day after
the day deposited in the mail, postage prepaid. As used herein, commercial
messenger service shall include FedEx and similar overnight delivery services.
(j) Counterparts. This Agreement may be executed in any number of
counterparts and by different parties hereto on separate counterparts, each of
which when so executed and delivered shall be an original, but all of which
together shall constitute one and the same agreement.
THE REST OF THIS PAGE LEFT INTENTIONALLY BLANK
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first written above.
XXXXXXX XXXXX INTERNATIONAL
By XXXXXXX LYNCH, PIERCE, XXXXXX & XXXXX INCORPORATED As Agent for
Xxxxxxx Xxxxx International
By____________________________
Name:
Title:
XXXXXXX LYNCH, PIERCE, XXXXXX & XXXXX INCORPORATED
As Collateral Agent
By____________________________
Name:
Title:
XXXXX FARGO BANK MINNESOTA, NATIONAL ASSOCIATION, as Trustee under the
Note A Indenture dated as of
April ____, 2001
By_____________________________
Name:
Title:
XXXXX FARGO BANK MINNESOTA, NATIONAL ASSOCIATION, as Trustee under the
Note B Indenture dated as of
April ___, 2001
By______________________________
Name:
Title:
EXHIBIT A
QUALIFIED CMBS INSTITUTIONS
Xxxxxx Brothers
Xxxxxx Xxxxxxx
X.X. First Boston
X.X. Xxxxxx Chase
Bear Xxxxxxx
