LOAN AGREEMENT
by
and between
CAMBR
CHARITABLE FOUNDATION TRUST,
as
the Lender
And
AMERICAN
REALTY CAPITAL NEW YORK RECOVERY REIT, INC.,
as
the Borrower
Dated
as of June 15, 2010
NYRR IDB
Equity Bridge
Loan
Agreement dated as of June 15, 2010 (“Agreement”) by and between AMERICAN REALTY
CAPITAL NEW YORK RECOVERY REIT, INC. (the “Borrower”), and CAMBR CHARITABLE
FOUNDATION TRUST (the “Lender”).
W I T N E S S E T H:
WHEREAS,
the Borrower and the Lender desire to enter into this Agreement in order to fund
the short-term borrowing needs of the Borrower in connection with the
acquisition of the Properties;
NOW,
THEREFORE, in consideration of the foregoing premise, the covenants, agreements,
representations and warranties, and obligations hereinafter contained, and for
good and valuable consideration, the receipt and adequacy of which are hereby
acknowledged, the Borrower and the Lender hereby agree as follows:
ARTICLE
1 DEFINITIONS
Section
1.1. Defined Terms
As used
herein the following terms shall have the following meanings:
“Affiliate” as applied
to any Person shall mean any other Person directly or indirectly through one or
more intermediaries controlling, controlled by, or under common control with,
that Person. For the purposes of this definition, “control”
(including with correlative meanings, the terms “controlling”, “controlled by”
and “under common control with”), as applied to any Person, means the
possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of that Person, whether through the
ownership of voting securities or by contract or otherwise.
“Agreement” shall mean
this Loan Agreement, as the same from time to time may be amended, supplemented
or modified.
“Business Day” shall
mean a day other than a Saturday, Sunday or other day on which commercial banks
are authorized or required to close under the laws of the State of New
York.
“Capitalized Lease”
shall mean any lease under which the obligations to pay rent or other amounts
constitute Capitalized Lease Obligations.
“Capitalized Lease
Obligations” shall mean as to any Person, the obligations of such Person
to pay rent or other amounts under a lease of (or other agreement conveying the
right to use) real and/or personal property which obligations are required to be
classified and accounted for as a capital lease on a balance sheet of such
Person under GAAP and, for purposes of this Agreement, the amount of such
obligations shall be the capitalized amount thereof, determined in accordance
with GAAP.
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“Closing Date” means
the date on which Borrower’s acquisition of the Properties is
effected.
“Condemnation” means
the taking by any Governmental Authority of the Property or any part thereof
through eminent domain or otherwise (including, without limitation, any transfer
made in lieu of or in anticipation of the exercise of such taking).
“Consolidated Net
Worth” shall mean, with respect to the Borrower for any period, net worth
as determined and computed on a consolidated basis in accordance with
GAAP.
“Contractual
Obligations” shall mean as to any Person, any provision of any security
issued by such Person or of any agreement, instrument or undertaking to which
such Person is a party or by which such Person or any of its property is
bound.
“Default” shall mean
any of the events specified in this Agreement under “Events of Default”, whether
or not any requirement for the giving of notice, the lapse of time, or both, has
been satisfied.
“Dollars” and “$” shall mean dollars
in lawful currency of the United States of America.
“Effective Date” shall
have the meaning set forth in Section 10.12 hereof.
“Environmental Laws”
shall mean any federal, state or local statute or regulation relating to
hazardous or toxic wastes or substances or the removal thereof.
“Equity Interests”
shall mean, as to any Person, all shares, interests, partnership interests,
limited liability company interests, participations, rights in or other
equivalents (however designated) of such Person’s equity (however designated)
and any rights, warrants or options exchangeable for or convertible into such
shares, interests, participations, rights or other equity.
“Event of Default”
shall mean any of the events specified in this Agreement under “Events of
Default”, provided that any
requirement for the giving of notice, the lapse of time, or both, or any other
condition, has been satisfied.
“Exit Fee” shall have
the meaning set forth in Section 2.4(c) hereof.
“Formation Documents”
means, as applicable, the certificate of formation, certification of
incorporation, limited liability company agreement, partnership agreement,
articles of incorporation, by-laws, any other organizational documents of the
Borrower, and each as amended from time to time.
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“GAAP” shall mean
generally accepted accounting principles applied in a manner consistent with
that employed in the preparation of the financial statements described in
Section 3.1.
“Governmental
Authority” means any federal, state, local, or other governmental or
administrative body, instrumentality, board, department, or agency or any court,
tribunal, administrative hearing body, arbitration panel, commission, or other
similar dispute-resolving panel or body.
“Indebtedness” shall
mean, with respect to any Person, (a) all obligations of such Person for
borrowed money or with respect to deposits or advances of any kind, (b) all
obligations of such Person evidenced by bonds, debentures, notes or other
similar instruments, (c) all obligations of such Person for the deferred
purchase price of property or services, except current accounts payable arising
in the ordinary course of business and not overdue more than sixty (60) days,
except to the extent of accounts payable contested in good faith by proper
proceedings which stay the imposition of any penalty, fine or Lien resulting
from the non-payment thereof and with respect to which adequate reserves have
been set aside for the payment thereof in accordance with GAAP, (d) all
obligations of such Person under conditional sale or other title retention
agreements relating to property purchased by such Person, (e) all payment
obligations of such Person with respect to interest rate or currency protection
agreements, (f) all obligations of such Person as an account party under any
letter of credit or in respect of bankers’ acceptances, (g) all obligations of
any third party secured by property or assets of such Person (regardless of
whether or not such Person is liable for repayment of such obligations), (h) all
guarantees of such Person, excluding, however, the endorsement of negotiable
instruments for deposit or collection in the ordinary course of business, (i)
Capitalized Lease Obligations not incurred in the ordinary course of business,
and (j) the redemption price of all redeemable preferred stock of such Person,
but only to the extent that such stock is redeemable at the option of the holder
or requires sinking fund or similar payments at any time prior to the Maturity
Date.
“Interest Expense”
shall mean, with respect to the Borrower for the applicable period of
determination thereof, the interest expense of the Borrower during such period
determined on a consolidated basis in accordance with GAAP, and shall in any
event include, without limitation, (i) the amortization of debt discounts, (ii)
the amortization of all fees payable in connection with the incurrence of
Indebtedness to the extent included in interest expense and (iii) the portion of
any Capitalized Lease Obligation allocable to interest expense.
“Internal Revenue
Code” shall mean the Internal Revenue Code of 1986, as it may be amended
from time to time.
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“Interest Rate” shall
have the meaning set forth in Section 2.4(a) hereof.
“Investments” shall
mean any loan or advance of money, credit or property to or investment in (by
capital contribution, loan, purchase or otherwise) any firm, corporation, or
other Person, other than accounts receivable or deposits (other than deposits
that have been reserved for purposes of investing such funds in any firm,
corporation or other Person) arising in the ordinary course of
business.
“Leases” shall have
the meaning set for in Section 3.21 hereof.
“Lien” shall mean any
mortgage, pledge, security interest, hypothecation, assignment, deposit
arrangement, encumbrance, or preference, priority or other security agreement or
preferential arrangement of any kind or nature whatsoever (including, without
limitation, any conditional sale or other title retention agreement, any
financing lease having substantially the same economic effect as any of the
foregoing, and the filing of any financing statement under the Uniform
Commercial Code or comparable law of any jurisdiction).
“Loan” shall mean the
loan made pursuant to Section 2.1 hereof.
“Loan Amount” shall
have the meaning set forth in Section 2.2 hereof.
“Loan Documents” shall
mean this Agreement, the Note and each document, agreement and instrument
executed in connection herewith or pursuant hereto or in connection with or
pursuant to any of the foregoing, together with each document, agreement and
instrument made by the Borrower with or in favor of or owing to the
Lender.
“Maturity Date” shall
mean January 1, 2011.
“Obligations” shall
mean any and all sums owing under the Loan Documents and all other obligations,
direct or contingent, joint, several or independent, of the Borrower now or
hereafter existing due or to become due to, or held or to be held by the Lender,
whether created directly or acquired by assignment or otherwise.
“Person” shall mean
any individual, corporation, limited liability company, partnership, joint
venture, trust, unincorporated organization or any other judicial entity, or a
government or state or any agency or political subdivision thereof.
“Post Default Rate”
shall mean at any time a rate of interest equal to 2% per annum in excess of the
Interest Rate.
“Properties” and each
individually, a “Property” shall mean
the real estate acquired by the Borrower in connection with the
Loan.
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“Purchase Money
Indebtedness” means Indebtedness of the Borrower incurred for the purpose
of financing all or any part of the purchase price, or other cost of
construction or improvement of any property; provided that the
aggregate principal amount of such Indebtedness does not exceed the lesser of
the fair market value of such property or such purchase price or
cost.
“Purchase Price” means
the sum of (a) the appraised value of the Properties prepared by a third
party appraiser acceptable to the Lender and prepared in accordance with the
appraisal requirements generally acceptable to the Lender (“Appraised Value”);
and (b) all transaction costs and expenses directly related to the purchase
of the Properties, subject to a limit of 5% of (a) above. The
Purchase Price shall include only acquisition costs directly related to the
purchase of the Properties, and shall not include any general administrative
expenses or overhead costs of the Lender.
“Requirements of Law”
shall mean as to any Person, the organizational or governing documents of such
Person, and any law, treaty, rule or regulation, or determination of an
arbitrator or a court or other governmental authority, in each case applicable
to or binding upon such Person or any of its property or to which such Person or
any of its property is subject.
“Subsidiary” or “Subsidiaries” of any
Person shall mean a corporation, partnership, limited liability company, limited
partnership or other entity in which that Person directly or indirectly owns or
controls Equity Interests having ordinary voting power to elect a majority of
the board of directors (or appoint other comparable managers) of such
corporation, partnership, limited liability company, limited partnership or
other entity.
Section
1.2. Accounting Terms
As used
in the Loan Documents and in any certificate, opinion or other document made or
delivered pursuant thereto, accounting terms not defined in Section 1.1, and
accounting terms partly defined in Section 1.1, to the extent not defined, shall
have the respective meanings given to them under GAAP. If any change
in GAAP would affect the computation of any financial ratio or requirement set
forth in this Agreement, the Lender and the Borrower shall negotiate in good
faith to amend such ratio or requirement to reflect such change in GAAP, provided that, until
so amended, (i) such ratio or requirement shall continue to be computed in
accordance with GAAP prior to such change and (ii) the Borrower shall provide to
the Lender financial statements and other documents required under this
Agreement (or such other items as the Lender may reasonably request) setting
forth a reconciliation between calculations of such ratio or requirement before
and after giving effect to such change.
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Section
1.3. Rules of Interpretation
(a)
Unless expressly provided in any Loan Document to the contrary, (i) the words
“hereof”, “herein”, “hereto” and “hereunder” and similar words
when used in each Loan Document shall refer to such Loan Document as a whole and
not to any particular provision thereof, (ii) article, section, subsection,
schedule and exhibit references contained therein shall refer to article,
section, subsection, schedule and exhibit thereof or thereto, (iii) the words
“include” and “including”, shall mean that
the same shall be “included,
without limitation”, (iv) any definition of, or reference to, any
agreement, instrument, certificate or other document herein shall be construed
as referring to such agreement, instrument or other document as from time to
time amended, supplemented or otherwise modified, (v) any reference herein to
any Person shall be construed to include such Person’s successors and assigns,
(vi) the words “asset”
and “property”
shall be construed to have the same meaning and to refer to any and all
tangible and intangible assets and properties, including cash, securities,
accounts and contract rights, (vii) words in the singular number include the
plural, and words used therein in the plural include the singular, (viii) any
reference to a time shall refer to such time in New York, (ix) in the
computation of periods of time from a specified date to a later specified date,
the word “from” means
“from and including”
and the words “to”
and “until” each
means “to but
excluding”, and (x) references therein to a fiscal period shall refer to
that fiscal period of the Borrower.
(b)
Article and Section headings have been inserted in the Loan Documents for
convenience only and shall not be construed to be a part thereof.
ARTICLE 2 AMOUNT AND TERMS OF
LOAN
Section
2.1. Loan
Subject
to the terms and conditions set forth herein, and in reliance on Borrower’s
representations, warranties and covenants set forth herein, Lender has made a
Loan in the amount of $1,700,000 to Borrower. The Loan is evidenced by this
Agreement and by the Note made by Borrower to the order of Lender and shall bear
interest and be paid upon the terms and conditions, including the payment of any
and all fees, provided herein. The Loan made hereunder shall be
repaid or prepaid (subject to the Exit Fee) by the Borrower in accordance with
the applicable terms and conditions set forth herein.
Section
2.2. Note
The Loan
made by the Lender to the Borrower shall be evidenced by a promissory note of
the Borrower substantially in the form of Exhibit A hereto with
appropriate insertions (the “Note”), payable to the order of the Lender and
representing the obligation of the Borrower to pay the unpaid principal amount
of the Loan made by the Lender to the Borrower, with interest and fees thereon
as hereinafter prescribed (collectively, the “Loan Amount”). The
Promissory Note shall (i) be dated the date of this Agreement and (ii) be stated
to mature on the Maturity Date.
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Section
2.3. Intentionally Omitted
Section
2.4. Interest and Fees
(a) Interest. Interest
on the Loan shall accrue at a rate per annum equal to nine percent (9%) of the
Loan and shall be payable monthly in arrears, except as otherwise expressly
provided herein (the “Interest Rate”). The Interest Rate on the
outstanding principal balance shall be computed on the basis of a 360-day year
for actual days elapsed and shall accrue on the first day of each month starting
on the first day of the month following the Effective Date and shall be payable
as provided in this Agreement. After any stated or accelerated
maturity, the Note shall bear interest at the Post Default Rate.
(b) Exit Fee.
Simultaneously with the final payment of the Loan, and no later than on the
Maturity Date, the Borrower shall pay to lender a fee of 1% of the original Loan
Amount.
Section
2.5. Intentionally Omitted
Section
2.6. Interest Payments; Manner of Payments; Rate After Default; Schedule to
Note
(a)
Interest Payments. Unless sooner accelerated as provided in this
Agreement or the Note upon the occurrence of an Event of Default, Borrower shall
make monthly payments of interest at the Interest Rate on the outstanding
principal balance of the Loan, payable in arrears, commencing on the first
(1st) day of
the month following the date hereof, and continuing on the first day of each
month thereafter (each, a “Payment Date”) until
the entire indebtedness evidenced hereby and the Note is paid in full or the
Maturity Date, whichever first occurs. Any sums due on a day which is
not a Business Day shall be due on the following Business
Day. Interest shall accrue on any day that any principal is
outstanding, including days which are not Business Days.
(b)
Principal Payments. Commencing on the Payment Date in August, 2010
and continuing on each Payment Date thereafter until the entire indebtedness
evidenced hereby and the Note is paid in full or the Maturity Date, whichever
first occurs, Borrower shall make monthly payments of principal in the amount of
not less than one-sixth (1/6th) of the
original Loan Amount. Any sums due on a day which is not a Business
Day shall be due on the following Business Day. Interest shall accrue
on any day that any principal is outstanding, including days which are not
Business Days.
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(c) All
payments (including prepayments) to be made by the Borrower on account of
principal or interest with respect to the Loan or on account of fees or any
other obligations of the Borrower to the Lender hereunder shall be made to the
Lender at the office of the Lender set forth in Section 10.1 hereof or at such
other place as the Lender may from time to time designate in writing in lawful
money of the United States of America in immediately available funds, without
counterclaim or setoff and free and clear of, and without any deduction or
withholding for, any taxes or other payments. If any payment to be so
made hereunder, or under the Note, becomes due and payable on a day other than a
Business Day, such payment shall be extended to the next succeeding Business Day
and, to the extent permitted by applicable law, interest thereon shall be
payable at the then applicable rate during such extension. All payments shall be
applied first to the payment of all fees, expenses and other amounts due to the
Lender (excluding principal and interest), then to accrued interest, and then on
account of outstanding principal; provided, however, that after
the occurrence of an Event of Default, payments will be applied to the
obligations of the Borrower to the Lender as the Lender determines in its sole
discretion.
(d) Upon
and following an Event of Default, all Loans, and any and all accrued and unpaid
interest, fee or amount due hereunder, to the extent permitted by applicable
law, shall bear interest (payable on demand, and in any event on the last day of
each month, and computed daily on the basis of a 360-day year for actual days
elapsed) at the Post Default Rate until paid. The obligation to so
pay interest upon any obligation of the Borrower to the Lender shall not be
construed so as to waive the requirement for payment on the same date that
payment is to be made to the Lender as set forth in this Agreement.
(e) The
Borrower may voluntarily prepay the Loan in full or in part at any time upon
prior written notice to the Lender received no later than 4 p.m. on the date of
such prepayment.
(f) The
Borrower hereby expressly authorizes the Lender to record on the schedule
attached to the Note the amount and date of the Loan, the rate of interest
thereon, the date and amount of each payment of principal and the unpaid
principal balance; provided, however, that the
failure of the Lender to make any such notation shall not in any manner affect
the obligation of the Borrower to repay any Loan in accordance with the terms
hereof. All such notations shall be presumed to be correct, absent
manifest error.
Section
2.7. Use of Proceeds
The
proceeds of the Loan hereunder shall be used for the short-term borrowing needs
of the Borrower for the acquisition of the Properties. To the extent
there are gains or losses from a sale of a Property acquired with proceeds from
the Loan, such gains or losses shall be exclusively those of the Borrower,
providing Borrower has paid down the Loan consistent with this Agreement and
other Loan Documents.
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ARTICLE 3 REPRESENTATIONS AND
WARRANTIES
In
order to induce the Lender to enter into this Agreement and to make the
financial accommodations herein provided for, the Borrower hereby covenants,
represents and warrants to the Lender that:
Section
3.1. Financial Condition
(a) The
financial statements of the Borrower heretofore furnished to the Lender, are
complete and correct and present fairly the financial condition of the Borrower
as at such date. Such financial statements, including schedules and
notes thereto, have been prepared in accordance with GAAP. The
Borrower has no material contingent obligations, contingent liabilities or
liabilities for taxes, long-term leases or unusual forward or long-term
commitments, which are not reflected in the foregoing statements or in the notes
thereto. Since the date of the aforementioned financial statements,
there has been no material adverse change in the business, operations, assets or
financial or other condition of the Borrower (“Material Adverse
Change”).
Section
3.2. Corporate Existence; Compliance with Law
The
Borrower (a) is duly organized and subsisting under the laws of the State of
Maryland, (b) has the power and authority and the legal right to own and operate
its property, and to conduct the business in which it is currently engaged, (c)
except where the failure to do so, individually or in the aggregate, could not
reasonably be expected to result in a Material Adverse Change, is duly qualified
as a foreign entity and in good standing under the laws of each jurisdiction
where its ownership or operation of property or the conduct of its business
require such qualification, and (d) except where the failure to do so,
individually or in the aggregate, could not reasonably be expected to result in
a Material Adverse Change, is in compliance with all Requirements of
Law.
Section
3.3. Power; Authorization; Enforceable Obligations
The
Borrower has the power and authority and the legal right to make, execute,
deliver and perform its Obligations under the Loan Documents to which it is a
party, and to borrow hereunder and has taken all necessary action to authorize
the borrowing on the terms and conditions of the Loan Documents and to authorize
the execution, delivery and performance of the Loan Documents to which it is a
party. No consent or authorization of, filing with, or other act by
or in respect of any other Person or any Governmental Authority, is
required in connection with the borrowings hereunder or with the execution,
delivery, performance, validity or enforceability of the Loan Documents to which
the Borrower is a party. The Loan Documents to which the Borrower is
a party will be duly executed and delivered on behalf of the Borrower and such
Loan Documents, when executed and delivered, will each constitute a legal, valid
and binding obligation of the Borrower enforceable against the Borrower in
accordance with its terms, subject to applicable bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting creditors rights
generally and subject to general principles of equity, regardless of whether
considered in a proceeding in equity or at law.
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Section
3.4. No Legal Bar
The
execution, delivery and performance of the Loan Documents to which the Borrower
is a party and the borrowings hereunder and the use of the proceeds thereof by
the Borrower will not violate any Requirement of Law or any Contractual
Obligation of the Borrower, and will not result in, or require, the creation or
imposition of any Lien on any of its properties or revenues pursuant to any
Requirement of Law or Contractual Obligation, except those in favor of the
Lender provided herein.
Section
3.5. No Material Litigation
No
litigation, investigation or proceeding of or before any arbitrator or
Governmental Authority is pending by or against the Borrower (a) with respect to
any Loan Document or any of the transactions contemplated hereby or thereby or
(b) which if adversely determined, could reasonably be expected to result in a
Material Adverse Change.
Section
3.6. No Default
The
Borrower is not in default under or with respect to any Contractual Obligation
in any respect which could reasonably be expected to result in a Material
Adverse Change or which could reasonably be expected to materially and adversely
affect the ability of the Borrower to perform its obligations under the Loan
Documents to which it is a party. As of the date hereof, no Default
or Event of Default has occurred and is continuing.
Section
3.7. No Burdensome Restrictions
The
Borrower is not subject to any Contractual Obligation or Requirement of Law
which could reasonably be expected to result in a Material Adverse Change or
which could reasonably be expected to materially and adversely affect the
ability of the Borrower to perform its obligations under the Loan Documents to
which it is a party.
Section
3.8. Taxes
The
Borrower has filed, or caused to be filed, all tax returns which are required to
be filed, and has paid all taxes shown to be due and payable on said returns or
on any assessments made against them or any of their property, except taxes that
are being contested in good faith by appropriate proceedings and for which the
Borrower has set aside on its books adequate reserves in accordance with
GAAP.
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Section
3.9. Federal Regulations
The
Borrower is not engaged nor will it engage, principally or as one of its
important activities, in the business of extending credit for the purpose of
“purchasing” or “carrying” any “margin stock” within the meanings under
Regulation U of the Board of Governors of the Federal Reserve System as now and
from time to time hereafter in effect. No part of the proceeds of any
Loan hereunder will be used for “purchasing” or “carrying” “margin stock” as so
defined or for any purpose which violates, or which would be inconsistent with,
the provisions of the Regulations of such Board of Governors.
Section
3.10. Environmental Matters
(a)
Except with respect to any matters that, individually or in the aggregate, could
not reasonably be expected to result in a Material Adverse Change, each Property
(i) is in compliance with applicable Environmental Laws and any permit, license
or other approval required under any applicable Environmental Law and (ii) is
not subject to any pending or unresolved environmental liability.
(b)
Except as could not reasonably be expected to result in a Material Adverse
Change, there are no proceedings pending or, to the knowledge of the Borrower,
contemplated under any federal, state or local law regulating the discharge of
hazardous or toxic materials or substances into the environment, relating to the
Property.
Section
3.11. Properties, Priority of Liens
The
Borrower has or will have upon the Closing Date good, marketable and insurable
fee simple title of record to the Properties, free and clear of any Lien of any
nature whatsoever, except as permitted by Section 7.4 hereof.
Section
3.12. Name Changes, Mergers, Acquisitions
The
Borrower has not within the six-year period immediately preceding the date of
this Agreement changed its name, been the surviving entity of a merger or
consolidation, or acquired all or substantially all of the assets of any
Person.
Section
3.13. Intentionally Omitted
Section
3.14. No Condemnation.
No
Condemnation proceeding has been commenced or, to the Borrower’s knowledge, is
contemplated with respect to all or any portion of any Property or for the
relocation of roadways providing access to the Property.
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Section
3.15. Requirements of Law.
Each
Property and its present and contemplated use and occupancy are in material
compliance with all Requirements of Law.
Section
3.16. Operating Permits.
Borrower
has obtained all licenses, permits, registrations, certificates and other
approvals, governmental and otherwise (including, without limitation, zoning,
building code, land use and environmental), necessary for the use, occupancy and
operation of each Property and the conduct of its business thereat, all of which
are in full force and effect as of the date hereof. No event or
condition currently exists which could result in the revocation, suspension, or
forfeiture thereof.
Section
3.17. Flood Zone.
Except as
otherwise disclosed on the survey of each Property provided to Lender in
connection with the Loan, no portion of the improvements on such Properties is
located in an area identified by the Federal Emergency Management Agency or any
successor thereto, as an area having special flood hazards.
Section
3.18. Adequate Utilities.
Each
Property is adequately served by all utilities required for the current or
contemplated use thereof. All water and sewer systems are provided to
each Property by public utilities, and each Property has accepted or is equipped
to accept such utility services.
Section
3.19. Public Access.
All
public roads and streets necessary for access to each Property for the current
or contemplated use thereof have been completed, are serviceable and
all-weather, and are physically and legally open for use by the
public.
Section
3.20. Assessments.
No
unpaid assessments for public improvements or assessments otherwise affecting
any Property currently exist or, to the Borrower’s knowledge, are pending, nor
are improvements contemplated to any Property that may result in any such
assessments.
Section
3.21. Leases.
Upon the
Closing Date, with respect to the leases at the Properties (the “Leases”),
Borrower, or a subsidiary of Borrower, is the sole owner of the lessors’ entire
interest in the Leases and has not assigned, pledged or otherwise transferred
the rents reserved in the Leases except in connection with any purchase money
mortgages.
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ARTICLE
4 CONDITIONS PRECEDENT
Section
4.1. Conditions to Lender Obligations
The
obligation of the Lender to make the Loan to the Borrower hereunder is subject
to the satisfaction of the following conditions precedent:
(a) Note and other
Agreements. The Lender shall have received: (i) the Note duly
executed by the Borrower; (ii) the organizational documents of the Borrower,
including, without limitation, the Formation Documents of the Borrower; and (ii)
good standing certificates issued by the appropriate office of each state in
which the Borrower is qualified to do business as a foreign entity.
(b) Intentionally
Omitted.
(c) Capitalization. The legal
structure and capitalization of the Borrower shall be satisfactory to the
Lender.
(d) Representations and
Warranties. The representations and warranties made by the Borrower
herein in any certificate, document or financial or other statement furnished at
any time under or in connection herewith, shall be correct on and as of the date
herein, except to the extent that such representations and warranties expressly
relate to an earlier date in which case such representations and warranties
shall be true and correct in all material respects as of such earlier
date.
(e) Due
Diligence. The Lender shall have completed due diligence with
respect to the Borrower and the Borrower shall have fully cooperated with the
Lender in connection therewith and the results of the foregoing shall be
satisfactory to the Lender in its sole discretion.
(f) Insurance. The
Borrower shall have delivered to the Lender evidence of the Borrower’s liability
insurance policies and copies of certificates of the issuing companies with
respect to such insurance policies owned by the Borrower covering or in any
manner relating to each Property. All such certificates are in form
and substance reasonably satisfactory to the Lender.
(g) Material Adverse
Change. The Lender shall have determined, in its sole
judgment, that no Material Adverse Change shall have occurred since June 1,
2010.
(h) Approvals. All
material consents, authorizations and approvals of, and filings and
registrations with, and all other actions in respect of, any Governmental
Authority or other Person required in connection with the making of the Loan or
the conduct of the Borrower’s business with respect to the Properties shall have
been obtained and shall be in full force and effect.
-14-
(i) No Default or Event of
Default. No Default or Event of Default shall have occurred
and be continuing on the Effective Date.
(j) Legality. The
making of such Loan shall not contravene any law, rule or regulation applicable
to the Lender.
(k) Additional
Matters. All other documents and legal matters in connection
with the transactions contemplated by this Agreement shall be reasonably
satisfactory in form and substance to the Lender and its counsel.
ARTICLE 5 AFFIRMATIVE COVENANTS
The
Borrower hereby agrees that, so long as this Agreement remains in effect, the
Note remains outstanding and unpaid, or any other amount is owing to the Lender
hereunder, the Borrower will:
Section
5.1. Existence and Qualification
Take the
reasonably necessary steps to preserve its existence as a corporation and its
right to conduct business in all states in which the nature of its business
requires qualification to do business. In the event of dispute
between the Borrower and the Lender as to when qualification is necessary, the
decision of the Lender shall control.
Section
5.2. Financial Information
(a) Keep
its books of account in accordance with good accounting practices and furnish to
the Lender within 120 days after the last day of each of its fiscal years, the
balance sheet of the Borrower as at such last day of the fiscal year and
statements of income and retained earnings and cash flows for such fiscal year
each and prepared and certified by the chief financial or accounting officer or
authorized officer of the Borrower as having been prepared in accordance with
GAAP consistently applied; and within 45 days after the close of each of the
fiscal quarters of each fiscal year balance sheets, statements of income and
retained earnings and cash flows of the Borrower as of the last day of and for
such quarter; in reasonable detail and prepared and certified by the chief
financial or accounting officer or authorized officer of the Borrower as having
been prepared in accordance with GAAP (subject to year-end
adjustments). The Borrower will also, with reasonable promptness,
furnish such other data as may be reasonably requested by the
Lender.
(b)
Within 10 days of any officer of the Borrower obtaining knowledge of any
Default, if such Default is then continuing, the Borrower shall furnish to the
Lender a certificate of the chief financial or accounting officer of the
Borrower setting forth the details thereof and the action which the Borrower is
taking or proposes to take with respect thereto.
-15-
Section
5.3. Insurance
With
respect to the Properties, maintain insurance with responsible and reputable
insurance companies or associations in such amounts and covering such risks as
is usually carried by companies engaged in similar businesses and owning similar
properties in the same general areas in which the Borrower
operates. Such policies will contain a provision whereby they cannot
be canceled except after thirty (30) days’ prior written notice to the
Lender.
Section
5.4. Preservation of Properties; Compliance with Law and Contractual
Obligations
Maintain
and preserve all of the Properties in good working order and condition, ordinary
wear and tear excepted, and comply with all Requirements of Law and Contractual
Obligations, and take all necessary steps to preserve its existence and
franchises and comply with all future Requirements of Law and Contractual
Obligations applicable to it in the operation of its business with respect to
the Properties, except to the extent non-compliance could not reasonably be
expected to result in, either individually or in the aggregate, a Material
Adverse Change.
Section
5.5. Taxes
Pay
before the same become delinquent all taxes, assessments and governmental
charges or levies imposed upon it or upon its income or profits or upon any of
its Properties, and all lawful claims which if unpaid might become a Lien or
charge upon any of the Properties, except to the extent contested in good faith
by proper proceedings which stay the imposition of any penalty, fine or Lien
resulting from the non-payment thereof and with respect to which adequate
reserves have been set aside for the payment thereof in accordance with
GAAP.
Section
5.6. Notice of Litigation
Promptly
notify the Lender in writing of any litigation, legal proceeding or dispute,
whether or not in the ordinary course of business, involving amounts in excess
of Five Hundred Thousand Dollars ($500,000.00), affecting the Borrower, whether
or not fully covered by insurance, and regardless of the subject matter thereof
(excluding, however, any actions relating to workers’ compensation claims or
negligence claims relating to use of motor vehicles, if fully covered by
insurance, subject to deductibles).
-16-
Section
5.7. Change of Location
Without
the prior notice to the Lender, change the location of its places of business or
establish any new place of business, or discontinue any existing, place of
business.
Section
5.8. Books and Records
Keep
accurate and complete records of its accounts, inventory and equipment
consistent with good accounting practices.
Section
5.9. Inspection Rights.
If a
Default or an Event of Default shall have occurred and be continuing, permit the
Lender and representatives and agents of the Lender upon reasonable prior
notice, to examine and make copies of and abstracts from the Borrower’s records
and books of account, to visit and inspect the Borrower’s Properties, to verify
materials, leases, notes, accounts receivable, deposit accounts and its other
assets, to conduct audits, physical counts, valuations, appraisals,
environmental assessments or examinations and to discuss the Borrower’s affairs,
finances and accounts with any of the Borrower’s directors, officers, managerial
employees, independent accountants or any of the Borrower’s other
representatives, all at such reasonable times during normal business hours at
the expense of the Borrower. In furtherance of the foregoing, the
Borrower shall authorize its independent accountants to discuss the affairs,
finances and accounts of the Borrower (independently or together with
representatives of the Borrower) with the Lender and representatives and agents
of the Lender in accordance with this Section 5.10.
Section
5.10. Information Upon Repayment or Prepayment.
At the
time of repayment or prepayment of all or a portion of the Loan Amount, the
Borrower shall provide to the Lender a true and complete statement of all
Obligations of the Borrower as of the date of such repayment or prepayment, in
each case showing the amount prepaid or repaid, the aggregate principal amount
of the Loan, the amount of Interest, the Repayment Premium, and the amount of
any outstanding fees owed by the Borrower to the Lender.
Section
5.11. Other Information.
From time
to time, such other information or documents (financial or otherwise) with
respect to the Borrower as the Lender may reasonably request and that is
prepared by the Borrower and/or its Affiliates in the ordinary course of
business.
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ARTICLE
6 INTENTIONALLY OMITTED
ARTICLE 7 NEGATIVE COVENANTS
The
Borrower hereby agrees that, so long as this Agreement remains in effect, the
Note remains outstanding and unpaid, or any other amount is owing to the Lender
hereunder it will not:
Section
7.1. Indebtedness for Borrowed Money
Incur, or
permit to exist, any Indebtedness for borrowed money, except, (i) Purchase Money
Indebtedness (newly issued or by assumption), (ii) Indebtedness incurred under
any other loans made by Camber Company, Inc. or the Lender in its discretion to
the Borrower, or (iii) unsecured trade credit incurred in the ordinary course of
business.
Section
7.2. Mergers, Acquisitions and Sales of Assets
Enter
into any merger or consolidation or liquidate, windup or dissolve itself or
sell, transfer or lease or otherwise dispose of all or any substantial part of
its assets or acquire by purchase or otherwise the business or assets of, or
stock of, another business entity, except in the ordinary course of business per
the terms of the articles of incorporation or otherwise with the prior written
consent of the Lender.
Section
7.3. Investments
Make, or
suffer to exist, any Investment in any Person if such Investment is not
expressly permitted under the Formation Documents of the Borrower.
Section
7.4. Liens
Create,
assume or permit to exist, any Lien on any of the Properties except: (i) Liens
in favor of the Lender; (ii) statutory Liens of landlords and Liens of carriers,
warehousemen, mechanics, suppliers, materialmen, repairmen and other Liens
imposed by law incurred in the ordinary course of business for sums not yet
delinquent or being contested in good faith, if such reserve or other
appropriate provision, if any, as shall be required by GAAP shall have been made
in respect thereof; (iii) Liens Incurred or deposits made in the ordinary course
of business in connection with workers’ compensation, unemployment insurance and
other types of social security, including any Lien securing letters of credit
issued in the ordinary course of business consistent with past practice in
connection therewith, or to secure the performance of tenders, statutory
obligations, surety and appeal bonds, bids, leases, government performance and
return-of-money bonds and other similar obligations (exclusive of obligations
for the payment of borrowed money); (iv) any interest or title of a lessor under
any Capitalized Lease Obligation; (v) purchase money Liens securing Purchase
Money Indebtedness incurred to finance the acquisition of property; (vi) liens
securing reimbursement obligations with respect to commercial letters of credit
which encumber documents and other property relating to such letters of credit
and products and proceeds thereof; and (vii) liens encumbering deposits made to
secure obligations arising from statutory, regulatory, contractual, or warranty
requirements of the Borrower, including rights of offset and
set-off.
-18-
Section
7.5. Contingent Liabilities
Without
the prior written consent of the Lender, assume, endorse, be or become liable
for or guarantee the obligations of any Person, excluding, however, the
endorsement of negotiable instruments for deposit or collection in the ordinary
course of business.
Section
7.6. Borrower Net Worth
The
Consolidated Net Worth of Borrower shall be no less than
$5,000,000.00.
Section
7.7. Modifications of Indebtedness, Organizational Documents and Certain Other
Agreements, Etc.
(a)
Amend, modify or otherwise change (or permit the amendment, modification or
other change in any manner of) any of the provisions of any of its Indebtedness
or of any instrument or agreement (including, without limitation, any purchase
agreement, indenture, loan agreement or security agreement) relating to any such
Indebtedness if such amendment, modification or change would (i) increase the
interest rate on such Indebtedness; (ii) accelerate the dates upon which
payments of principal or interest are due on, or increase the principal amount
of, such Indebtedness; (iii) change in a manner materially adverse to the
Borrower any event of default or add or make more restrictive any covenant with
respect to such Indebtedness; (iv) change in a manner adverse to the Borrower,
the prepayment, redemption or put provisions of such Indebtedness; (v) change
the subordination provisions thereof (or the subordination terms of any guaranty
thereof), if any; or (vi) change or amend any other term if such change or
amendment would increase the obligations of the obligor or confer additional
material rights on the holder of such Indebtedness in a manner adverse to the
Borrower or the Lender, except in the case of this Section 7.7(a), if the
incurrence of such Indebtedness, upon such amended terms, is not prohibited
hereunder.
(b)
Except as permitted by Section 7.2, amend, modify or otherwise change its name,
jurisdiction of formation or organizational identification number, in each case
without providing the Lender not less than five (5) days prior written notice
(or such shorter notice as the Lender may consent to in writing in its sole
discretion).
-19-
(c)
Without not less than five (5) days prior written consent of the Lender, change
any executive officer of the Borrower.
(d)
Amend, modify or otherwise change its Formation Documents or any agreement or
arrangement entered into by it, with respect to any of its Equity Interests, or
enter into any new agreement with respect to any of its Equity Interests, except
any such amendments, modifications or changes or any such new agreements or
arrangements pursuant to this Section 7.7(d) that, either individually or in the
aggregate, are not adverse to the Lender and could not reasonably be expected to
result in a Material Adverse Change.
Section
7.8. Accounting Changes
Make, or
permit any Subsidiary to make, any change in its accounting treatment or
financial reporting practices, except as required or permitted by GAAP in effect
from time to time.
Section
7.9. Transactions with Affiliates
Except as
otherwise specifically set forth in this Agreement and in the Formation
Documents, directly or indirectly purchase, acquire or lease any property from,
or sell, transfer or lease any property to, or enter into any other transaction,
with any Affiliate, except in the ordinary course of business and at prices and
on terms not less favorable to it than those which would have been obtained in
an arm’s-length transaction with a non-affiliated third
party. Notwithstanding the foregoing, this Section 7.9 shall not
apply to (i) reasonable fees and compensation (in cash, securities, options or
similar rights or otherwise) paid to, and any indemnity provided on behalf of,
officers, directors, employees, consultants or agents of the Borrower as
determined in good faith by the Borrower’s directors and officers; (ii) any
transactions undertaken pursuant to any Contractual Obligation or contractual
right set forth on Schedule 7.9 which is in existence as of the date
hereof and modifications and extensions thereof not materially
adverse to the Borrower; (iii) loans and advances to officers, directors and
employees of the Borrower for travel, entertainment, moving and other relocation
expenses, in each case made in the ordinary course of business and not exceeding
$500,000 outstanding at any one time; and (iv) funding made in the ordinary
course of business of the operational/working capital needs of the Subsidiaries
from time to time in a manner consistent with prior practice.
ARTICLE 8 EVENTS OF DEFAULT; REMEDIES
Section
8.1. Events of Default
Each of
the following events shall constitute an “Event of Default” under this
Agreement:
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(a) the
Borrower shall fail to (i) pay the principal of the Note when due, or (ii) pay
any principal or interest on the Note when due or any other amount payable
hereunder and such failure shall continue unremedied for a period of five (5)
days, provided
that if the fifth (5th) day
shall fall on a day that is not a Business Day, then the next succeeding
Business Day thereafter; or
(b) any
representation or warranty made or deemed made by the Borrower herein or which
is contained in any certificate, document or financial or other statement
furnished at any time under or in connection with this Agreement shall prove to
have been false in any material respect on or as of the date made or deemed
made, or
(c) the
Borrower shall default in the observance or performance of any covenant or
provision contained in Section 2.6, Section 5.2, Article 6 or Article 7 hereof;
or
(d) the
Borrower shall default in the observance or performance of any covenant or
provision contained in Article 5 (other than Section 5.2) hereof and such
default shall not be cured by the Borrower within 10 days following its receipt
of notice thereof; or
(e) the
Borrower shall default in the observance or performance of any other provision
contained in this Agreement or the other Loan Documents and such default shall
not be cured by the Borrower within 30 days following its receipt of notice
thereof; or
(f) the
Borrower shall (i) default in any payment of any Indebtedness (other than the
Note) in excess of $1,000,000 beyond the period of grace, if any, provided in
the instrument or agreement under which such Indebtedness was created or (ii)
default in the observance or performance of any other agreement or condition
relating to any such Indebtedness or contained in any instrument or agreement
evidencing, securing or relating thereto or any other event shall occur or
condition exist, in each case the effect of which default or other event or
condition is to cause or permit the holder or holders of such Indebtedness (or a
trustee or agent on behalf of such holder or holders) to cause such Indebtedness
to become due prior to its stated maturity; or
(g) (i)
the Borrower shall commence any case, proceeding or other action (A) under any
existing or future law of any jurisdiction, domestic or foreign, relating to
bankruptcy, insolvency, reorganization or relief of debtors, seeking to have an
order for relief entered with respect to it, or seeking to adjudicate it a
bankrupt or insolvent, or seeking reorganization, arrangement, adjustment,
winding-up, liquidation, dissolution, composition or other relief with respect
to it or its debts, or (B) seeking appointment of a receiver, trustee, custodian
or other similar official for it or for all or any substantial part of its
assets, or the Borrower shall make a general assignment for the benefit of its
creditors; or (ii) there shall be commenced against the Borrower any case,
proceeding or other action of a nature referred to in clause (i) above which (A)
results in the entry of an order for relief or any such adjudication or
appointment or (B) remains undismissed, undischarged or unbonded for a period of
60 days; or (iii) there shall be commenced against the Borrower any case,
proceeding or other action seeking issuance of a warrant of attachment,
execution, distraint or similar process against all or any substantial part of
its assets not in the possession of the Lender which results in the entry of an
order for any such relief which shall have not been vacated, discharged, or
stayed or bonded pending appeal within 45 days from the entry thereof; or (iv)
any garnishment, levy, writ or warrant of attachment or similar process shall be
issued and served against the Lender, which garnishment, levy, writ or warrant
of attachment or similar process relates to property of the Borrower in the
possession of the Lender; or (v) the Borrower shall take any action in
furtherance of, or indicating its consent to, approval of, or acquiescence in,
any of the acts set forth in clause (i), (ii), (iii) or (iv) of this Section
8.1(g); or (vi) the Borrower shall generally not, or shall be unable to, or
shall admit in writing its inability to, pay its debts as they become due;
or
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(h) the
rendition by any court of a final judgment against the Borrower in excess of
$5,000,000 which shall not be satisfactorily stayed, discharged, vacated or set
aside within sixty (60) days of the making thereof; or the attachment of any
property of the Borrower which has not been released or provided for to the
reasonable satisfaction of the Lender within sixty (60) days after the making
thereof; or
(i) the
Lender acting on an informed basis shall have reasonably determined that one or
more Material Adverse Changes have occurred.
Section
8.2. Remedies
Upon the
occurrence and during the continuance of any Event of Default specified in
Section 8.1(g), without declaration or notice to the Borrower, the entire Loan,
all accrued and unpaid interest thereon and all other amounts owing under the
Loan Documents shall immediately become due and payable, and upon the occurrence
and during the continuance of any other Event of Default, then, in any such
event, any or all of the following actions may be taken: the Lender
may, at its option, declare the Loan hereunder (with accrued interest thereon)
and all other amounts owing under this Agreement and the Note to be due and
payable and the same, and all interest accrued thereon, shall forthwith become
due and payable without presentment, demand, protest or notice of any kind, all
of which are hereby waived, anything contained herein or in any instrument
evidencing the Loan to the contrary notwithstanding.
ARTICLE 9 GUARANTY
Section
9.1. Borrower Guaranty
(a) The
Borrower guarantees to the Lender (i) the prompt payment and discharge of the
Obligations in full when due (whether at stated maturity, as a mandatory
prepayment, by acceleration, as a mandatory cash collateralization or otherwise)
strictly in accordance with the terms herein.
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(b) The
Loan and the Borrower’s Obligations under the Loan are unsecured and shall not
result in the imposition of any Lien in favor of the Lender on the Properties or
assets of the Borrower.
ARTICLE
10 MISCELLANEOUS
Section
10.1. Notices
Except in
the case of notices and other communications expressly permitted to be given by
telephone, all notices and other communications provided for herein shall be in
writing and shall be delivered by hand or overnight courier service, mailed by
certified or registered mail or sent by telecopy, as follows:
|
The
Borrower:
|
American
Realty Capital New York Recovery REIT, Inc.
|
||
|
000
Xxxx Xxxx
|
|||
|
Xxxxxxxxxx,
XX 00000
|
|||
|
Attn: Xxxxx
Xxxxx
|
|||
|
Fax
Number: 000-000-0000
|
|||
|
with
a copy to:
|
American
Realty Capital
|
||
|
000
Xxxx Xxxxxx, 00xx
Xxxxx
|
|||
|
Xxx
Xxxx, XX 00000
|
|||
|
Attn: Xxxxx
X. Xxxxxxxx, Esq.
|
|||
|
Fax
Number: 000-000-0000
|
|||
|
The
Lender:
|
CAMBR
Charitable Foundation Trust
|
||
|
000
Xxxxx Xxxxxx
|
|||
|
Xxxxxxxx,
XX 00000
|
|||
|
Attn: Xxxxx
Xxxxxxxx
|
|||
|
Fax
Number: [________________]
|
Any of
the addressees list above may change its address or telecopy number for notices
and other communications hereunder by notice to the other parties
hereto. All notices and other communications given to any such
addressee in accordance with the provisions of this Agreement shall be deemed to
have been given on the date of receipt.
-23-
Section
10.2. No Waiver; Cumulative Remedies
No
failure to exercise and no delay in exercising, on the part of the Lender, any
right, remedy, power or privilege hereunder shall operate as a waiver thereof;
nor shall any single or partial exercise of any right, remedy, power or
privilege hereunder preclude any other or further exercise thereof or the
exercise of any other right.
Section
10.3. Survival of Representations and Warranties
All
representations and warranties made hereunder and in any document, certificate
or statement delivered pursuant hereto or in connection herewith shall survive
the execution and delivery of this Agreement and the Note.
Section
10.4. Expenses
Each of
the Borrower and the Lender shall bear all of its own costs and expenses
(including, without limitation, attorneys’ fees and expenses) incurred in
connection with the preparation, administration, default, collection, waiver or
amendment of any of the Loan Documents, or in connection with the Borrower’s or
the Lender’s exercise, preservation or enforcement of any of its rights,
remedies or options hereunder.
Section
10.5. WAIVER OF JURY TRIAL
THE
BORROWER AND THE LENDER (BY ACCEPTANCE OF THE NOTE) MUTUALLY HEREBY KNOWINGLY,
VOLUNTARILY AND INTENTIONALLY WAIVE THE RIGHT TO A TRIAL BY JURY IN RESPECT OF
ANY CLAIM BASED HEREON, ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS
AGREEMENT, THE NOTE AND/OR ANY OTHER LOAN DOCUMENTS CONTEMPLATED TO BE EXECUTED
IN CONNECTION HEREWITH OR ANY COURSE OF CONDUCT, COURSE OF DEALINGS, STATEMENTS
(WHETHER VERBAL OR WRITTEN) OR ACTIONS OF ANY PARTY, INCLUDING, WITHOUT
LIMITATION, ANY COURSE OF CONDUCT, COURSE OF DEALINGS, STATEMENTS OR ACTIONS OF
THE LENDER RELATING TO THE ADMINISTRATION OF THE LOANS OR ENFORCEMENT OF THE
LOAN DOCUMENTS AND AGREE THAT NEITHER PARTY WILL SEEK TO CONSOLIDATE ANY SUCH
ACTION WITH ANY OTHER ACTION IN WHICH A JURY TRIAL CANNOT BE OR HAS NOT BEEN
WAIVED. EXCEPT AS PROHIBITED BY LAW, EACH OF THE LENDER AND THE
BORROWER HEREBY WAIVES ANY RIGHT IT MAY HAVE TO CLAIM OR RECOVER IN ANY
LITIGATION ANY SPECIAL, EXEMPLARY, PUNITIVE OR CONSEQUENTIAL DAMAGES OR ANY
DAMAGES OTHER THAN, OR IN ADDITION TO, ACTUAL DAMAGES. EACH OF THE
PARTIES HERETO HEREBY CERTIFIES TO THE OTHER THAT NONE OF ITS REPRESENTATIVES,
AGENTS OR ATTORNEYS HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT IT WOULD NOT,
IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING
WAIVER. THIS WAIVER CONSTITUTES A MATERIAL INDUCEMENT FOR THE LENDER
AND THE BORROWER TO ENTER INTO THIS AGREEMENT AND CONSUMMATE THE TRANSACTIONS
SET FORTH HEREIN.
-24-
Section
10.6. Modification and Waiver
No
modification or waiver, of or with respect to any provision of this Agreement or
any document or instrument delivered in connection therewith, shall be effective
unless and until it shall be in writing and signed by the Lender.
Section
10.7. Successors and Assigns
(a) This
Agreement shall be binding upon and inure to the benefit of the Borrower, the
Lender, all future holders of the Note and their respective successors and
assigns, except that the Borrower may not assign or transfer any of its rights
or Obligations under this Agreement, except to an Affiliate of Borrower and with
the prior written consent of the Lender.
(b) The
Lender shall not have the right at any time to assign all or any portion of its
rights and obligations hereunder to any other Person.
Section
10.8. Indemnification.
The
Borrower shall pay, indemnify, defend, and hold the Lender, its officers,
employees and agents (each, an “Indemnified Person”) harmless (to the fullest
extent permitted by law) from and against any and all claims, demands, suits,
actions, investigations, proceedings, liabilities, fines, costs, penalties, and
damages, and all reasonable fees and disbursements of attorneys, experts, or
consultants and all other costs and expenses actually incurred in connection
therewith or in connection with the enforcement of this indemnification (as and
when they are incurred and irrespective of whether suit is brought), at any time
asserted against, imposed upon, or incurred by any of them (a) in connection
with or as a result of or related to the execution, delivery, enforcement,
performance, or administration (including any restructuring or workout with
respect hereto) of this Agreement, any of the other Loan Documents, or the
transactions contemplated hereby or thereby or the monitoring of the Borrower’s
compliance with the terms of the Loan Documents, (b) with respect to any
investigation, litigation, or proceeding related to this Agreement, any other
Loan Document, or the use of the proceeds of the credit provided hereunder
(irrespective of whether any Indemnified Person is a party thereto), or any act,
omission, event, or circumstance in any manner related thereto, and (c) in
connection with or arising out of any presence or release of hazardous
materials, any environmental actions, any environmental liabilities or any
response actions related in any way to any assets or properties of the Borrower
(each and all of the foregoing, the “Indemnified Liabilities”). The
foregoing to the contrary notwithstanding, the Borrower shall have no obligation
to any Indemnified Person under this Section 10.8 with respect to any
Indemnified Liability that a court of competent jurisdiction finally determines
to have resulted from the gross negligence or willful misconduct of such
Indemnified Person. This provision shall survive the termination of
this Agreement and the repayment of the Obligations. If any
Indemnified Person makes any payment to any other Indemnified Person with
respect to an Indemnified Liability as to which the Borrower was required to
indemnify the Indemnified Person receiving such payment, the Indemnified Person
making such payment is entitled to be indemnified and reimbursed by the Borrower
with respect thereto. WITHOUT LIMITATION, THE FOREGOING INDEMNITY
SHALL APPLY TO EACH INDEMNIFIED PERSON WITH RESPECT TO INDEMNIFIED LIABILITIES
WHICH IN WHOLE OR IN PART ARE CAUSED BY OR ARISE OUT OF ANY NEGLIGENT ACT OR
OMISSION OF SUCH INDEMNIFIED PERSON OR OF ANY OTHER PERSON.
-25-
Section
10.9. Governing Law; Consent to Jurisdiction
THIS
AGREEMENT, THE NOTE AND ANY DOCUMENTS AND INSTRUMENTS DELIVERED IN CONNECTION
HEREWITH AND THEREWITH AND THE RIGHTS AND DUTIES OF THE PARTIES HEREUNDER AND
THEREUNDER SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE
WITH, THE LAW OF THE STATE OF NEW YORK. THE BORROWER AGREES THAT ANY SUIT FOR
THE ENFORCEMENT OF THIS AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS MAY BE
BROUGHT IN THE COURTS OF THE STATE OF NEW YORK LOCATED IN NEW YORK COUNTY OR, IF
JURISDICTION SHALL EXIST, ANY FEDERAL COURT SITTING THEREIN AND CONSENTS TO THE
NONEXCLUSIVE JURISDICTION OF SUCH COURT AND SERVICE OF PROCESS IN ANY SUCH SUIT
BEING MADE UPON THE BORROWER BY MAIL AT THE ADDRESS SET FORTH IN THIS AGREEMENT.
THE BORROWER HEREBY WAIVES ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO
THE VENUE OF ANY SUCH SUIT OR ANY SUCH COURT OR THAT SUCH SUIT IS BROUGHT IN AN
INCONVENIENT FORUM.
Section
10.10. Entire Agreement
This
Agreement and the other Loan Documents are intended by the parties as the final,
complete and exclusive statement of the transactions evidenced
thereby. All prior or contemporaneous promises, agreements and
understandings, whether oral or written, are deemed to be superseded by this
Agreement and such other Loan Documents, and no party is relying on any promise,
agreement or understanding not set forth in this Agreement or such other Loan
Documents. Neither this Agreement nor any of such other Loan
Documents may be amended or modified except by a written instrument describing
such amendment or modification executed by the Borrower and the
Lender.
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Section
10.11. Interest Adjustment.
All
agreements between the Borrower and the Lender are hereby expressly limited so
that in no contingency or event whatsoever, whether by reason of acceleration of
maturity of the indebtedness evidenced by a Note or otherwise, shall the amount
paid or agreed to be paid to the Lender for the use or the forbearance of the
indebtedness evidenced hereby exceed the maximum permissible under applicable
law. As used herein, the term “applicable law” shall mean the law in
effect as of the date hereof provided, however, that in the
event there is a change in the law which results in a higher permissible rate of
interest, then this Agreement, the Note and the other Loan Documents shall be
governed by such new law as of its effective date. In this regard, it
is expressly agreed that it is the intent of the Borrower and the Lender in the
execution, delivery and acceptance of this Agreement, the Note and the other
Loan Documents to contract in strict compliance with the laws of the State of
New York from time to time in effect. If, under or from any
circumstances whatsoever, fulfillment of any provision hereof or of any of the
other Loan Documents at the time of performance of such provision shall be due,
shall involve transcending the limit of such validity prescribed by applicable
law, then the obligation to be fulfilled shall automatically be reduced to the
limits of such validity, and if under or from any circumstances whatsoever the
Lender should ever receive as interest an amount which would exceed the highest
lawful rate, such amount which would be excessive interest shall be applied to
the reduction of the principal balance evidenced by the Note and not to the
payment of interest. This provision shall control every other
provision of all agreements between the Borrower, each other party obligated on
a Note and the Lender.
Section
10.12. Effective Date
This
Agreement shall be effective on the date (the “Effective Date”) as of which (a)
this Agreement shall be executed by all the parties hereto and delivered to the
Lender and (b) all the conditions precedent required to have been satisfied on
or before the extension of credit hereunder pursuant to Section 4.1 hereof shall
have been satisfied or waived (whether temporarily or otherwise) in writing by
the Lender. The Lender shall notify the Borrower of the Effective Date if other
than the date of the execution of this Agreement; provided, however, that, the failure to give such notice
shall not alter the Effective Date or any of the Lender’s rights under this
Agreement or the other Loan Documents.
Section
10.13. No Waiver Action
Any
waiver or consent respecting any representation, warranty, covenant or other
term or provision of this Agreement or any other Loan Document shall be
effective only in the specific instance and for the specific purpose for which
given and shall not be deemed, regardless of frequency given, to be a further or
continuing waiver or consent. The failure or delay of a party at any time or
times to require performance or, or to exercise its rights with respect to, any
representation, warranty, covenant or other term or provision of this Agreement
or other Loan Document in no manner (except as otherwise expressly provided
herein) shall affect its right at a later time to enforce any such
provision. No notice to or demand on a party in any case shall
entitle such party to any other or further notice or demand in the same, similar
or other circumstances. The acceptance by the Lender of (a) any partial or late
payment shall not constitute a satisfaction or waiver of the full amount then
due or the resulting Event of Default or (b) any payment during the continuance
of an Event of Default shall not constitute a waiver or cure thereof; and the
Lender may accept or reject any such payment without affecting any of its
rights, powers, privileges, remedies and other interests under this Agreement,
the other Loan Documents and applicable law. All rights, powers, privileges,
remedies and other interests of the parties hereunder are cumulative and not
alternatives, and they are in addition to and shall not limit (except as
otherwise expressly provided in this Agreement) any other right, power,
privilege, remedy or other interest of the parties under this Agreement, any
other Loan Document or applicable law.
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Section
10.14. Severability
Every
provision of the Loan Documents is intended to be severable, and if any term or
provision thereof shall be invalid, illegal or unenforceable for any reason, the
validity, legality and enforceability of the remaining provisions thereof shall
not be affected or impaired thereby, and any invalidity, illegality or
unenforceability in any jurisdiction shall not affect the validity, legality or
enforceability of any such term or provision in any other
jurisdiction.
Section
10.15. Exculpation
Each
party hereto hereby acknowledges and confirms that (i) no director, officer,
employee or limited partner of the Borrower (each an “Exculpated Person”) shall
be personally liable for any obligation or liability of the Borrower under this
Agreement or any other Loan Document and (ii) all obligations and liabilities of
the Borrower under this Agreement or any other Loan Document are enforceable
solely against the Borrower and its assets and not against any Exculpated Person
or the assets of any Exculpated Person. Notwithstanding anything to
the contrary, in the event of any conflict between the terms of any other Loan
Document and this Section 10.15, this Section 10.15 shall govern and
prevail.
Section
10.16. Counterparts
This
Agreement may be signed in counterparts with the same effect as if the
signatures thereto and hereto were upon the same instrument.
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IN
WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed and delivered in New York, New York by their respective proper and duly
authorized officers as of the day and year first above written.
| LENDER: | |||
| CAMBR CHARITABLE FOUNDATION TRUST | |||
|
|
By:
|
||
| Name: | |||
| Title: | |||
| BORROWER: | |||
| AMERICAN REALTY CAPITAL NEW YORK RECOVERY REIT, INC. | |||
|
|
By:
|
||
| Name: Xxxxxxx X. Xxxxxx | |||
| Title: President | |||
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EXHIBIT
A
FORM OF PROMISSORY
NOTE
PROMISSORY
NOTE
| $1,700,000 | June 15, 2010 |
1. Promise to
pay. For value received, AMERICAN REALTY CAPITAL
NEW YORK RECOVERY REIT, INC. (the “Borrower”), promises to pay to CAMBR
CHARITABLE FOUNDATION TRUST, (the “Lender”), or order, on February 1, 2011 (the
“Maturity Date”), with interest as provided in this Note, the principal sum of
ONE MILLION SEVEN HUNDRED THOUSAND DOLLARS ($1,700,000) or such lesser amount as
shall have been borrowed by the Borrower and remain outstanding under the Loan
Agreement (as hereinafter defined). Each capitalized term used herein
without definition shall have the meaning ascribed to it in the Loan
Agreement.
2. Loan
Agreement. This Note evidences Indebtedness arising from a
certain Loan Agreement dated as of the date of this Note (the “Loan Agreement”)
by and between the Lender and the Borrower. The Loan Agreement is
hereby incorporated by reference into this Note as if set forth in
full. As used herein, the defined term “Loan Agreement” shall include
all future amendments thereto, and restatements and replacements
thereof.
3. Payments. The
Borrower further promises to pay the principal amount of the Loan evidenced by
this Note together with interest thereon from the date hereof until the
repayment of the Loan in full, all at the rate(s), the times and place set forth
in Article 2 and, if applicable, Article 8 of the Loan
Agreement. Payments of both principal and interest are to be made by
immediately available funds in lawful money of the United States of
America. All payments made on account of this Note shall be applied
in accordance with Section 2.6 and, if applicable, Section 10.11 of the Loan
Agreement.
|
PAYMENT
DATE
|
PAYMENT
AMOUNT
|
|
July
1, 2010
|
Interest
only (in arrears)
|
|
August
1, 2010
|
Principal
and Interest (in arrears)
|
|
September
1, 2010
|
Principal
and Interest (in arrears)
|
|
October
1, 2010
|
Principal
and Interest (in arrears)
|
|
November
1, 2010
|
Principal
and Interest (in arrears)
|
|
December
1, 2010
|
Principal
and Interest (in arrears)
|
|
January
1, 2010
|
All
outstanding Principal and Interest (in
arrears)
|
-i-
4. Acceleration. Payment
of the entire unpaid balance of principal and accrued interest evidenced by this
Note is subject to acceleration under Article 8 of the Loan
Agreement. Following any Event of Default, the entire unpaid balance
of principal evidenced by this Note together with all accrued and unpaid
interest thereon and all other amounts owing under the Loan Agreement shall, at
the option of the Lender, become due and payable on demand without presentment,
demand, protest or notice of any kind, all of which are hereby waived by the
Borrower.
5. Governing
Law. This Note shall be governed by, and construed and
interpreted in accordance with, the law of the State of New York.
6. Replacement of
Original Note. Upon receipt of an affidavit of an officer of
the Lender as to the loss, theft, destruction or mutilation of this Note and a
customary indemnity agreement in favor of the Borrower, the Borrower will issue
a replacement note identical to this Note.
7. Miscellaneous. This
Note may not be modified, extended, or otherwise changed except by a written
instrument signed by the Lender and the Borrower. This Note shall be
binding upon the Borrower and its successors and permitted
assigns. All remedies specified in this Note are cumulative, and no
such remedies shall be considered to impair or preclude any other remedies
available to the Lender by law or by agreement.
| BORROWER: | |||
|
AMERICAN
REALTY CAPITAL NEW YORK RECOVERY REIT, INC.
|
|||
|
|
By:
|
||
| Name: Xxxxxxx X. Xxxxxx | |||
| Title: President | |||
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