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EXHIBIT 10.4
SUBORDINATION OF MANAGEMENT AGREEMENT
This Agreement is made and entered into as of the 30th day of
March, 1999, by ARDEN REALTY FINANCE V, L.L.C., a Delaware limited liability
company ("Owner"), and ARDEN REALTY LIMITED PARTNERSHIP a Maryland limited
partnership ("Manager"), in favor of MASSACHUSETTS MUTUAL LIFE INSURANCE
COMPANY, a Massachusetts corporation ("Lender"), with reference to the
Management Agreement and Properties as hereinafter defined.
Manager manages each of those certain real properties located in
the State of California, more particularly described on Exhibit "A" hereto
(collectively, referred to as the "Properties"), pursuant to that certain
Property Management Agreement (the "Management Agreement") dated March 31, 1999,
executed by Owner and Manager, a copy of which Management Agreement is attached
hereto as Exhibit "B".
In order to induce Lender to close a permanent loan with respect
to the Properties, Manager desires to subordinate all of Manager's rights and
interests under the Management Agreement to the rights and interests of Lender
under the documents evidencing and securing the said loan ("Loan Documents") and
to make the agreements for the benefit of Lender hereinafter set forth; and
Owner desires to consent to the agreements of Manager set forth in this
Agreement and to enter into certain agreements, hereinafter set forth, for the
benefit of Lender.
NOW THEREFORE for good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, the parties agree as follows:
1. The Owner and Manager agree not to materially alter or amend
the terms of the Management Agreement or otherwise delegate or assign to others
the management of the Properties without the prior written consent of Lender.
2. Manager hereby acknowledges and agrees that its rights
(including without limitation rights to payment) and interests, if any, in the
Properties pursuant to the Management Agreement, or otherwise, are and shall be
in all respects inferior, subject, and subordinate to the rights and interest of
Lender pursuant to the Loan Documents. If Manager receives any management fees
after its receipt of written notice from Lender that an Event of Default, as
defined in the Loan Documents, has occurred, and after any applicable notice and
cure periods, such sums shall be paid by Manager to Lender upon demand.
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3. Should an Event of Default occur under any of the Loan
Documents and should Lender elect to exercise its rights and remedies under the
Loan Documents, the Management Agreement and Manager's rights, interests, and
entitlement thereunder, at the option of Lender, may be terminated by Lender
effective upon Lender's providing Manager with written notice of its election to
so terminate the Management Agreement.
4. In the event of termination of the Management Agreement
pursuant to paragraph 3 above, Manager agrees to deliver, or make available to
Lender during normal business hours, all leases, books, records, accounts,
deposits, brochures and all other information and property in Manager's
possession regarding the management and operation of the Properties.
5. Exercise of the rights of Lender hereunder shall be without
any liability of Lender to Manager for past due management fees, expenses,
termination fees or otherwise for any sums owed by Owner to Manager pursuant to
the Management Agreement, provided that should Lender elect to continue to
employ Manager for the operation of the Properties, Lender shall pay Manager for
all fees and expenses accruing from and after the date Lender enters into
possession of the Properties.
6. All notices to Manager or Lender required or permitted
hereunder shall be given in writing by registered or certified mail, return
receipt requested, or by overnight courier providing a receipt, at the following
addresses,
Manager: Arden Realty Limited Partnership
00000 Xxxxxxxx Xxxxxxxxx
Xxxxxx Xxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Lender:Massachusetts Mutual Life Insurance Company
0000 Xxxxx Xxxxxx
Xxxxxxxxxxx, Xxxxxxxxxxxxx 00000
Attention: Senior Managing Director,
Real Estate Finance Group
or to such other address as may hereafter be specified by notice given as above
provided.
7. Owner consents to the agreements of Manager herein contained.
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8. This Agreement shall be binding upon the successors and
assigns of the parties hereto and shall inure to the benefit of the successors
and assigns of Lender.
9. This Agreement may not be amended and no provision of this
Agreement may be waived except by an agreement in writing signed by the party
against which the amendment or waiver is asserted and approved in writing by
Lender.
10. This Agreement shall be governed by and interpreted in
accordance with the laws of the State of California.
11. This Agreement may be executed in several counterparts, each
of which shall be deemed to be an original, and all of which together shall
constitute one and the same Agreement.
[SIGNATURES APPEAR ON NEXT PAGE]
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IN WITNESS WHEREOF, Manager and Owner have executed this
Agreement as of the date first above written.
OWNER:
ARDEN REALTY FINANCE V, L.L.C.,
a Delaware limited liability company,
By: _____________________________
Xxxxx X. Xxxxx,
Chief Financial Officer
MANAGER:
ARDEN REALTY LIMITED PARTNERSHIP
a Maryland limited partnership
By: Arden Realty, Inc.,
a Delaware corporation,
General Partner
By: _____________________________
Xxxxx X. Xxxxx,
Chief Financial Officer
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ACKNOWLEDGMENT
[California]
STATE OF CALIFORNIA )
) SS.
COUNTY OF ______________________________ )
On __________________ before me, (here insert name and title of the officer),
personally appeared ________________________________
______________________________________________ personally known to me (or proved
to me on the basis of satisfactory evidence) to be the person(s) whose name(s)
is/are subscribed to the within instrument and acknowledged to me that
he/she/they executed the same in his/her/their authorized capacity(ies), and
that by his/her/their signature(s) on the instrument the person(s), or the
entity upon behalf of which the person(s) acted, executed the instrument.
WITNESS my hand and official seal.
Signature ________________________________ (Seal)
STATE OF CALIFORNIA )
) SS.
COUNTY OF ______________________________ )
On __________________ before me, (here insert name and title of the officer),
personally appeared ________________________________
______________________________________________ personally known to me (or proved
to me on the basis of satisfactory evidence) to be the person(s) whose name(s)
is/are subscribed to the within instrument and acknowledged to me that
he/she/they executed the same in his/her/their authorized capacity(ies), and
that by his/her/their signature(s) on the instrument the person(s), or the
entity upon behalf of which the person(s) acted, executed the instrument.
WITNESS my hand and official seal.
Signature ________________________________ (Seal)
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EXHIBIT "A"
LEGAL DESCRIPTION
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EXHIBIT "B"
MANAGEMENT AGREEMENT
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