October 9, 1996
BY HAND
Capital Growth Mortgage Investors, L.P.
CBA Mortgage Corp.
GE Capital Asset Management Corporation, as Servicer
State Street Bank and Trust Company
(collectively, the "Lenders")
Laurel Centre Settlement Agreement
Gentlemen:
Please refer to the pending litigation in the Circuit Court for Prince
George's County, Maryland (the "Court"), identified as Case No. CAL
96-19899 (the "Litigation"), with respect to which a Verified
Complaint for Injunction and Declaratory Relief, dated September 20,
1996 (the "Complaint") was filed with the Court.
All capitalized terms not otherwise defined in this Agreement (the
"Agreement") shall have the meanings set forth in the Complaint, but
nothing in this Agreement is intended as an admission in, or
acquiescence as to any matter with respect to, the Litigation. Terms
not defined in the Complaint are defined in this Agreement, and in some
cases used before they are defined. A complete index of terms defined
in this Agreement appears after the last signature page of this
Agreement.
At this time an ex parte injunction (the "TRO") has been entered by the
Court with respect to the claims asserted in the Litigation.
The parties now agree as follows.
1. Litigation Status. Each Lender represents and warrants to the
Defendants that as of the date hereof such Lender has not commenced any
litigation or bankruptcy proceeding, or filed any demand for
arbitration in any jurisdiction or taken any action (including any
action relating to the pleadings, filing of amended or additional
pleadings, motions, requests for discovery, or motions or other
proceedings to seek to add an additional party) (any of the foregoing,
a "Litigation Activity") with respect to the Loan or the Loan
Documents, other than the following:
a. State Street. In the case of State Street, the filing of
the Complaint and the TRO;
b. Lenders. In the case of the Lenders, the filing of an
Amended Verified Complaint for Injunction and Declaratory
Relief dated October 8, 1996;
c. Responsive Pleadings. In the case of the Borrower Parties,
the filing of Defendants' Memorandum of Law in Opposition to
State Street Bank and Trust Company's Motion for Interlocutory
Injunction dated October 8, 1996;
d. CBA. In the case of CBA, a motion for leave to intervene
as plaintiff in the Litigation, dated October 4, 1996, which
was withdrawn or CBA agrees to promptly withdraw; and
e. Foreclosure. In the case of the Lenders, preparation of
the papers for the Foreclosure as permitted herein, which
papers at this time have not yet been signed, filed, or served.
2. Standstill. During the period from the date hereof until the
Standstill Termination Date (the "Standstill Period"):
a. Continuation of TRO. The TRO shall remain in effect in
accordance with the terms of this Agreement (without prejudice
to the continuing effectiveness of the TRO through and until
the Outside Date or the Borrower Release Date, if earlier).
The Defendants in the Litigation shall, pursuant to Maryland
Rule BB72(b), consent to the extension of the TRO in accordance
with the terms of this Agreement, and no party shall seek to
modify the TRO other than upon consent of all parties.
b. No Other Action. No Litigation Activity whatsoever (other
than actions necessary to implement this Agreement) shall be
taken.
c. Time Periods. All time periods, including the time to
answer the Complaint or take other action, shall be tolled.
d. No New Litigation. No party hereto shall commence any
litigation or bankruptcy proceedings, or file any demands for
arbitration, in any jurisdiction, or otherwise commence any
Litigation Activity, against any other party in connection with
any purported claim arising out of or relating to the Loan, the
Loan Documents, the Mall, or any and all distributions or
transfers of funds from Laurel Owner to Shopco or from Shopco
to Unitholders.
e. Enforcement of this Agreement. Notwithstanding the
foregoing, during the Standstill Period any party may commence
any action or file any papers in the Litigation as may be
necessary to enforce this Agreement.
f. Foreclosure. Notwithstanding the foregoing, from and after
the Foreclosure Commencement Date and during the Standstill
Period and thereafter Lenders may commence and prosecute the
Foreclosure as provided herein.
3. Standstill Termination Date.
a. Definition. The "Standstill Termination Date" shall mean
the date of the occurrence of (i) any violation by any Borrower
Party of the TRO as modified by this Agreement, which violation
is not cured within seven days after written notice to Laurel
Owner or (ii) the occurrence of any Borrower Interference. (It
is understood, however, that any other material breach of this
Agreement that continues for more than seven days after written
notice may be remedied by specific performance, only.)
b. Time to Answer. The time period to answer the Complaint
shall be extended to the date 20 days after the Standstill
Termination Date.
4. Protection of TRO. Until the Outside Date, the TRO shall remain in
effect, subject only to earlier termination upon the Borrower Release
Date. Defendants shall not attack the validity of the TRO because
more than ten days has passed since it was entered; because a hearing
on an "interlocutory injunction" was not held within ten days under
Maryland Rule BB70; because the hearing with respect to the TRO and the
time to answer the Complaint shall have been extended as provided for
in this Agreement; or any other similar procedural basis.
5. Extension of TRO. The parties shall from time to time promptly
take all actions in the Litigation as necessary to: (a) extend the
effective period of the TRO so that the TRO shall continue to be
effective until the Outside Date (subject to earlier dissolution of the
TRO on the Borrower Release Date); and (b) extend the hearing date on
the TRO (now October 9, 1996) to the earliest date available on the
court calendar within the period commencing on the first day and ending
on the seventh day after the Standstill Termination Date. The
Defendants in the Litigation shall, pursuant to Maryland Rule BB72(b),
consent to the extension of the TRO in accordance with the terms of
this Agreement until the Outside Date (subject to earlier termination
on the Borrower Release Date).
6. Management of Mall.
a. Appointment of Receiver. Laurel Owner acknowledges that
pursuant to and as part of the Foreclosure, Lenders intend to
obtain the appointment of Zamias Services, Inc. or such other
manager as the Lenders shall select (or, at Lenders' option,
individuals qualifying under Maryland law who will engage such
manager to act on their behalf) as receiver of the Mall (Zamias
Services, Inc., or such other manager, or such individuals, as
applicable, as receiver of the Mall, the "New Manager"),
effective upon October 16, 1996 (the "Foreclosure Commencement
Date") or as promptly thereafter as New Manager can be
appointed as receiver. New Manager shall have all the rights,
powers, duties and obligations as set forth in the Order
Appointing Receiver to be filed in the Foreclosure. Laurel
Owner, Shopco, or LCI (collectively, the "Borrower Parties")
shall not file any papers objecting to appointment of New
Manager as receiver, or objecting to the terms and conditions
under which the Lenders shall seek to obtain such appointment
(so long as such terms and conditions do not contain Adverse
Allegations).
b. Consent to Appointment. Provided that such papers do not
contain any Adverse Allegations, Laurel Owner and its counsel
shall promptly, when and as requested by Lenders, sign Lenders'
papers seeking the appointment of New Manager as receiver of
the Mall. If the Court appoints a person other than New
Manager as receiver of the Mall, then the Borrower Parties
shall not object to such actions as Lenders shall take to cause
the designated receiver to engage a manager selected by Lenders
as managing agent for the Mall. Laurel Owner acknowledges
that pursuant to the Loan Documents, Laurel Owner has consented
to the appointment of a receiver without notice. Accordingly,
Laurel Owner acknowledges that New Manager may be appointed as
receiver of the Mall without notice to Laurel Owner, and Laurel
Owner consents thereto.
c. Transition. On the date of New Manager's appointment as
receiver of the Mall (the effective date of such appointment,
the "Management Transition Date"), Laurel Owner shall cause
Shopco Management Corp. (the "Existing Manager") to deliver
possession of the Mall to New Manager, together with all
security deposits, the building management office, tenant books
and records and original leases, office equipment used in the
building management office, computer files and databases, lists
of accounts payable and receivable (including leasing brokerage
commissions), rent rolls, insurance policies, service
contracts, and all other information, documents and equipment
related to the Mall, all to the extent in Existing Manager's or
Laurel Owner's possession or control (collectively, the
"Management Materials").
d. Fees Payable on Termination. Laurel Owner shall pay,
solely from Borrower Cash, any fee payable to Existing Manager
on account of the termination of Existing Manager. For
purposes of the TRO, State Street hereby consents to the
application of Borrower Cash to pay Existing Manager, on
account of such termination, an amount not to exceed one
month's management fee to Existing Manager.
e. Transfer of Management Materials. Effective on the
Foreclosure Commencement Date, Laurel Owner hereby
unconditionally and irrevocably transfers, assigns, and conveys
to the Lenders, acting by and through New Manager, all
Management Materials, subject however to the reserved right of
Laurel Owner to inspect and copy Management Materials at
reasonable time(s) and in a reasonable manner as reasonably
necessary for Laurel Owner's financial and tax reporting and
recordkeeping.
f. Replacement of New Manager. The Lenders shall have the
right to replace New Manager as receiver in accordance with
Maryland law.
g. No New Contracts. From and after the date hereof until the
Foreclosure Commencement Date, Laurel Owner shall not enter
into any new contracts relating to the Mall requiring payments
in excess of $1,000 without approval of the Lenders, except in
an emergency or as required by law (provided that Laurel Owner
shall have given Lenders prior written notice to the extent
reasonably possible under the circumstances).
h. No Borrower Management. From and after the Foreclosure
Commencement Date, notwithstanding anything to the contrary in
the Loan Documents, all actions with respect to the management
or operation of the Mall, including any leasing, renegotiation
of existing leases, entering into or modification of service
contracts, undertaking of repairs, or directing, controlling
or paying any on-site management personnel, shall be undertaken
solely by New Manager as receiver pursuant to the Foreclosure.
Without limiting the generality of the foregoing, to the
extent that as receiver New Manager has the power or authority
to perform any action with respect to the Mall, Laurel Owner
shall not have the right or obligation to perform such action.
Nothing in this paragraph shall, however, limit Laurel Owner's
obligation (to the extent required by this Agreement) to
cooperate with the smooth transition of management to New
Manager when and as requested by the Lenders or New Manager
i. Status of Mall Operations. Laurel Owner represents and
warrants that as of the date hereof, as of the Foreclosure
Commencement Date and as of the date of appointment of New
Manager as receiver of the Mall, the Mall is being operated in
all respects substantially in accordance with Laurel Owner's
past practices, except as a result of the TRO.
j. Pre-Foreclosure Payables. Laurel Owner shall pay from
Borrower Cash all of Laurel Owner's payables that were due and
payable as of October 15, 1996 or before (the "Pre-Foreclosure
Payables"). Laurel Owner represents that Laurel Owner's
practice with respect to payables has been to direct Existing
Manager to pay bills (other than for real estate taxes and
insurance, both of which have been substantially prepaid) on or
about, or after, the required payment date. To the best of
Laurel Owner's knowledge (based on Laurel Owner's review of
operating reports provided by Existing Manager), Existing
Manager has consistently substantially complied with such
directions.
k. Funding of Operating Account. On the Management Transition
Date, Laurel Owner or Existing Manager shall deliver to New
Manager the sum of $260,000, which State Street hereby agrees
and consents may be funded from Borrower Cash. New Manager
shall hold and apply such sum as if it were Revenue collected
after the Foreclosure Commencement Date, in accordance with the
Waterfall. No Borrower Party shall have any claim or right
with respect to such sum.
l. Expenses Other Than Pre-Foreclosure Payables. All expenses
of the Mall other than Pre-Foreclosure Payables shall be paid
by New Manager from Revenue received in cash on or after the
Foreclosure Commencement Date.
m. Revenues. All Revenue paid on or after the Foreclosure
Commencement Date shall be collected by New Manager for the
benefit of Lenders regardless of the period covered, and
Borrower Parties shall promptly remit to New Manager on behalf
of the Lenders all Revenue received by Borrower Parties on or
after the Foreclosure Commencement Date.
n. Prepaid Items. No adjustment shall be made for prepaid
revenues or expenses.
o. Current Budget. Laurel Owner shall upon execution hereof
provide Lenders with a copy of Laurel Owner's annual budget,
broken down monthly, and all monthly operating statements for
1996 year to date (with monthly comparisons) for the Mall.
7. Gross Revenues. The Lenders agree among themselves (which
agreements do not affect Borrower Parties in any way) as follows:
a. Collection of Revenue. All rent, concession payments,
additional rent (including CAM payments, percentage rent,
payments on account of real estate taxes, and all other
escalations, pass-throughs and tenant reimbursements),
service charges, security deposits applied to a tenant's
lease obligations, late charges, proceeds of business
interruption and rent loss insurance, vending machine and
pay telephone commissions, and all other income of any kind
or type whatsoever arising from the Mall, regardless of the
period with respect to which accrued (collectively, the
"Revenue"), but excluding in any case Revenue received
before the Foreclosure Commencement Date and the Borrower
Cash, received by New Manager on or after the Foreclosure
Commencement Date shall be delivered to and collected and
administered by New Manager as receiver of the Mall.
b. Application of Revenue. New Manager shall apply all
such Revenue as follows, and in the following order of
priority, all of which State Street hereby consents to for
purposes of the TRO (collectively, the "Waterfall"):
i. Operating Expenses. Operating expenses of the Mall
as approved by the Lenders.
ii. Reserves. Reserves for capital improvements and
leasing expenses as approved by the Lenders.
iii. First Interest. To the extent of remaining funds
available, interest accruing on the First Loan
Documents from and after the date hereof, at the
applicable rate(s) (including any default rate(s))
provided for in the First Loan Documents, including
Section 8 of the First Note. All interest required by
the preceding sentence shall (to the extent of
available funds) be paid in cash and shall not be
accrued, deferred or added to principal.
iv. Second Interest. To the extent of remaining funds
available, interest accruing on the Second Loan
Documents from and after the date hereof, at the
applicable rate(s) (other than any default rate(s))
provided for in the Second Loan Documents, all of which
interest shall (to the extent of available funds) be
paid in cash and shall not be accrued, deferred or
added to principal.
v. Amortization. Any residual funds shall be applied
solely to amortize the principal amount of the First
Loan Documents, without any prepayment or repayment
fee.
8. Releases.
a. Lender-Borrower Releases. Each Lender hereby releases and
discharges each Borrower Party, together with the past, present
and future affiliates, partners, unitholders, stockholders,
directors, officers, employees, agents, consultants, advisors
and attorneys (the "Related Releasees") of such Borrower Party,
from and against any and all claims or causes of action that
such Lender may now or hereafter have against each Borrower
Party or its Related Releasees with respect to this Agreement,
the Loan Documents and the Mall. The foregoing releases in
this paragraph shall become effective only if and when the
Borrower Release Date has occurred.
b. Definition: Borrower Release Date. The "Borrower Release
Date" shall mean the first to occur of the following:
i. Ratification and Expiration of Appeal Periods. The
ratification by the Circuit Court for Prince George's
County of the sale made pursuant to the Foreclosure and
the expiration of all appeal periods thereafter,
without the filing of any appeal, or if any such appeal
shall have been filed, then the passage of sixty days
after such ratification.
ii. No Objections/Deadline. The occurrence of March
15, 1997 (which date shall be extended by one day for
every day on which Lenders' prosecution of the
Foreclosure is delayed as a result of any litigation
commenced by or on behalf of any person holding any
interest in any Borrower Party) (the "Outside Date"),
provided that: (a) except to the extent that the
Lenders make Adverse Allegations in the papers
appointing the New Manager as receiver, Laurel Owner
shall have promptly signed such papers to consent
thereto if, when and as required by this Agreement; (b)
except to the extent that the Lenders make Adverse
Allegations in the papers appointing the New Manager as
receiver, no Borrower Party shall have objected to the
appointment of New Manager as receiver of the Mall or
the terms and conditions of such appointment; (c) no
Borrower Party shall have filed voluntary bankruptcy;
(d) except to the extent that the Lenders make any
Adverse Allegations in the Foreclosure, no Borrower
Party shall have filed papers in the Foreclosure
(including any papers appealing or objecting to any
relief granted or action taken in the Foreclosure)
other than papers approved by the Lenders, or asserted
any defenses to the Foreclosure; (e) except to the
extent that the Lenders make Adverse Allegations in the
Foreclosure, no Borrower Party shall have filed any
objections or defenses to the Foreclosure or to the
sale pursuant thereto; (f) except to the extent that
the Lenders make Adverse Allegations in the
Foreclosure, no Borrower Party shall have initiated or
commenced any action to enjoin, restrain, or delay the
Foreclosure in any way; (g) if an involuntary
bankruptcy shall have been filed with respect to Laurel
Owner and Lenders shall have filed a motion for relief
from stay, then Laurel Owner shall not have contested
such motion; and (h) no Borrower Party shall have
violated the exclusive right of New Manager as receiver
to collect all Revenue from the Mall paid after the
Foreclosure Commencement Date and exercise full
dominion and control over the Mall pursuant to the
order appointing New Manager as receiver of the Mall,
which violation (as to this clause "h" only) is not
cured within seven days after written notice to Laurel
Owner. (The occurrence of any of the events whose
nonoccurrence is listed in "a" through "h" shall be
referred to herein as "Borrower Interference.")
c. Borrower-Lender Releases. Each Borrower Party hereby
releases and discharges each Lender, and the Related Releasees
of such Lender, from and against any and all claims or causes
of action that such Borrower Party may now or hereafter have
against each Lender or its Related Releasees with respect to
this Agreement, the Loan Documents and the Mall. The foregoing
releases in this paragraph shall become effective only if and
when the Borrower Release Date has occurred.
d. Inter-Lender Releases. Capital Growth hereby releases and
discharges each of the other Lenders, and the Related Releasees
of each of the other Lenders, from and against any and all
claims or causes of action that Capital Growth may now or
hereafter have against each of the other Lenders or its Related
Releasees with respect to this Agreement, the Loan, the Loan
Documents and the Mall. The Lenders other than Capital Growth
hereby release and discharge Capital Growth, and Capital
Growth's Related Releasees from and against any and all claims
or causes of action that such other Lenders may now or
hereafter have against Capital Growth or its Related Releasees
with respect to this Agreement, the Loan, the Loan Documents
and the Mall. The foregoing releases in this paragraph shall
become effective only if and when the Lenders have acquired
title to the Mall. Notwithstanding the foregoing, after such
transfer of title, the Participation Agreement and this
Agreement shall continue to govern the rights and obligations
of the Lenders as direct or indirect co-owners of the Mall.
9. Foreclosure. Notwithstanding anything to the contrary in this
Agreement, on the Foreclosure Commencement Date, Lenders may commence a
foreclosure action with respect to one or both of the Loans held by the
Lenders, with immediate appointment of New Manager as receiver (the
"Foreclosure"), as follows.
a. Foreclosure Papers. The papers for the Foreclosure shall
allege as the basis for the Foreclosure only Laurel Owner's
failure to pay the Loan on the Maturity Date. Such papers
shall not include any allegations of fraud, bad faith, personal
liability, or any claim to the Borrower Cash (but the foregoing
shall not be deemed Lenders' waiver of any claim to the
Borrower Cash as asserted in the Litigation) ("Adverse
Allegations"). Notwithstanding anything to the contrary in
this paragraph, if the Borrower Release Date occurs, then the
Lenders shall withdraw any claim to the Borrower Cash.
b. Events Supporting Foreclosure. Laurel Owner hereby
acknowledges that Laurel Owner is not entitled to, and no
Lender is obligated to provide, any notice, cure period, grace
period, or other forbearance with respect to the payment of the
entire principal amount of each Loan due upon the maturity date
thereof, and any such notice, cure period, grace period, or
other forbearance is hereby waived.
10. Borrower Cash.
a. Retention. Except as otherwise expressly permitted by this
Agreement or the TRO, until the Borrower Release Date, Borrower
Parties shall hold, in compliance with the TRO, any and all
cash or cash equivalents held by the Borrower Parties in
accordance with the TRO, including all Revenue collected by
Laurel Owner from the Mall on or before the Foreclosure
Commencement Date (collectively, the "Borrower Cash"),
including funds intended to be transferred to Unitholders
pursuant to the distribution (the "Special Distribution")
declared by Shopco on September 20, 1996.
b. Application. State Street hereby consents to Borrower
Parties' use of Borrower Cash (but not any Revenue paid after
the Foreclosure Commencement Date), but in any case excluding
the making of distributions, dividends or loans, in the
ordinary course of business consistent with past practice for
expenses not related to the ownership, management and operation
of the Mall, including, without limitation, to pay accounting
and financial reporting expenses, stock exchange fees,
transfer agent fees, director fees and legal fees
(collectively, "Partnership Expenses"). Partnership Expenses
may also include legal fees and disbursements incurred by
Borrower Parties. Without State Street's prior written
consent, Partnership Expenses shall not exceed the sum of: (a)
$182,095; plus (b) all legal fees and disbursements incurred by
Borrower Parties on account of work performed through October
9, 1996; plus (c) up to $500,000 on account of legal fees and
disbursements incurred by Borrower Parties for work performed
after October 9, 1996. Each Lender agrees that the foregoing
consent by State Street is a consent to such use of funds as
required by and in compliance with the TRO.
c. Release. Upon the occurrence of the Borrower Release Date,
the parties shall vacate the TRO and discontinue the Litigation
with prejudice to Plaintiffs and without costs to any party,
provided only that Laurel Owner shall have paid all its
Pre-Foreclosure Payables and Partnership Expenses, and provided
Lenders with reasonable evidence thereof. Upon such payment,
delivery of such evidence, and vacatur of the TRO on or after
the Borrower Release Date, Borrower Parties shall hold and may
apply or distribute in their discretion the Borrower Cash free
of claim or right by Lenders.
11. Conduct of Laurel Owner's Business. Until the Management
Transition Date, Laurel Owner shall continue to conduct its business in
the ordinary course of business, subject to the terms of the TRO and
this Agreement. From and after the appointment of New Manager as
receiver, Laurel Owner shall conduct no business activities of any kind
and shall incur no liabilities of any kind, except that Laurel Owner
may continue to conduct activities that would incur liabilities for
Partnership Expenses, and may continue to incur and pay liabilities for
Partnership Expenses, and may continue to own the Mall subject to the
New Manager as receiver and subject to the Foreclosure and applicable
law. Laurel Owner shall pay the Pre-Foreclosure Payables.
12. Stipulation or Consent Order. The parties shall promptly enter
into a Stipulation or Consent Order, to be filed in the Litigation,
memorializing and setting forth all terms and conditions of this
Agreement relating to the Standstill Period, the Standstill
Termination Date, the extension of the TRO and as otherwise expressly
provided herein, or attaching a copy of this Agreement. Lenders'
counsel shall draft such Stipulation or Consent Order subject to the
reasonable approval of the other parties. All parties signing this
Agreement shall cause their counsel to promptly sign and file, and to
thereafter comply with, such Stipulation or Consent Order.
13. Laurel Owner's Acknowledgment. Laurel Owner acknowledges that
nothing in this Agreement shall be deemed to violate any obligations of
any Lender to Laurel Owner, and shall not be deemed to unreasonably
involve any Lender in the management, business or operations of Laurel
Owner or cause any Lender to become a "mortgagee in possession."
Laurel Owner acknowledges that the arrangements set forth in this
Agreement are in all cases reasonably necessary and appropriate to
protect the security of the Lenders' collateral.
14. Further Assurances. Each party agrees to execute and deliver such
further documentation as may be necessary or appropriate to implement
the intentions of the parties as set forth in this Agreement.
Simultaneously with the passage of equitable title pursuant to the
Foreclosure, Laurel Owner shall assign to the Lenders or their
designee, without separate consideration, any environmental insurance
held by Laurel Owner with respect to the Mall, subject however to the
terms of any such insurance policy.
15. Rights and Remedies. Notwithstanding anything to the contrary in
the Loan Documents, except during the Standstill Period as it applies
to the TRO, nothing in this Agreement is intended to limit or restrict
any rights or remedies of either Lender under its Loan Documents.
16. Participant Approval. State Street, as participant under the
Participation Agreement, hereby consents to this Agreement and all
transactions contemplated or permitted by this Agreement and directs,
authorizes, and requests Capital Growth to enter into this Agreement,
which State Street has determined represents a reasonable, appropriate
and arm's length agreement under the circumstances.
17. Counterparts; Fax. This Agreement may be signed in counterparts,
which may be exchanged by fax. If this Agreement is signed by fax the
parties shall promptly exchange sufficient original counterparts so
each party can retain two fully executed originals. Failure to
exchange such counterparts shall not impair the validity of this
Agreement.
18. Confidentiality. All parties shall preserve the confidentiality
of this Agreement, except as required by law, stock exchange
requirements, or this Agreement, or for submission to the Court, or in
the Foreclosure. Before any Borrower Party makes any filing,
disclosure or release required by law or stock exchange requirements
relating to this Agreement or any matter relating to or arising from
this Agreement (a "Disclosure"), such Borrower Party shall obtain
Capital Growth's approval of such Disclosure, such approval not to be
unreasonably withheld or delayed. Before Capital Growth makes any
Disclosure, Capital Growth shall obtain Laurel Owner's approval of such
Disclosure, such approval not to be unreasonably withheld or delayed.
Notwithstanding the foregoing, this Agreement and its terms may be
disclosed to any attorneys, advisors or consultants working for any
party hereto.
19. Due Authorization. Each party represents and warrants that this
Agreement has been duly authorized by such party and all necessary
approvals to permit such party to enter into and perform this Agreement
have been obtained, except only for such additional approvals as are
expressly provided for in this Agreement.
20. Brokerage. Each party: (a) represents and warrants that it has
not dealt with any broker, finder, or other person entitled to a
commission or similar compensation with respect to the negotiation and
execution of this Agreement; and (b) shall indemnify, defend, and hold
harmless all other parties from any loss suffered (including payment of
reasonable attorneys' fees) as a result of any breach of such party's
representation and warranty in clause "a."
21. Notices. All notices hereunder shall be given by Federal Express
or other documented overnight delivery service or by-hand delivery and
shall be effective upon receipt or affirmative refusal to accept
delivery. Any notice given to any one party shall simultaneously be
given to all other parties by the same means. The addresses of the
parties are as follows:
a. All Borrower Parties. 3 World Financial Center, 00xx
Xxxxx, Xxx Xxxx, Xxx Xxxx 00000-0000, Attention: Mr. Xxxx
Xxxxxx, with a copy to Weil, Gotshal & Xxxxxx, LLP, 000 Xxxxx
Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Xxxx X. Xxxx,
Esq.
b. CBA Mortgage Corp. c/x Xxxxxxxx, Xxxxxx & Associates Inc.,
Financial Center, Suite 103, 000 Xxxx Xxxx Xxxxxx, Xxxxxxxx,
Xxxxxxxxxxx 00000. A copy of any notice to CBA Mortgage Corp.
shall be sent at the same time and by the same means to
Xxxxxxx, Baetjer and Xxxxxx, LLP, Attention: Xxx Xxxxx, Esq.,
at Xxx Xxxxxxx Xxxxx, Xxxxxxxxx, Xxxxxxxx 00000.
c. Capital Growth. 3 World Financial Center, 00xx Xxxxx, Xxx
Xxxx, Xxx Xxxx 00000-0000, Attention: Xx. Xxxxxxx X. Xxxxx,
with a copy to Xxxxxx & Xxxxxxx, Attention: Xxxxxx Xxxxx,
Esq., at 000 Xxxxx Xxxxxx, Xxxxx 0000, Xxx Xxxx, Xxx Xxxx
00000-0000.
d. State Street. c/o GE Capital Realty Group, 00000 Xxxxxx
Xxxxxxx, Xxxxx 000, Xxxxxx, Xxxxx 00000, Attention: Xx. Xxxxxx
Xxxxxxxx, with a copy to: Xxxxx Xxxxxxx, Esq., Xxxxxxx Xxxxx
Xxxxxxx & Xxxxxxxxx, 000 Xxxx Xxxxxxx Xxxxxx, Xxxxxxxxxx Xxxxx,
Xxxxxxxxx, Xxxxxxxx 00000.
22. Successors and Assigns. This Agreement is intended to bind and
benefit the parties and their successors and assigns. If any party
assigns its interests with respect to the Mall, such assignment shall
automatically include its rights and obligations under this Agreement;
the assignee shall assume all obligations of the assignor under this
Agreement; and assignor and assignee shall promptly notify all other
parties of the assignment.
23. Interaction Among Lenders. The Lenders agree as follows, which
agreements do not affect Borrower Parties in any way and are intended
to modify the Participation Agreement (as previously modified by the
Agreement dated October 1, 1987, between Capital Growth's predecessor
in interest, State Street's predecessor in interest and Shearson
California, as defined therein).
a. Disputes. In the event of a dispute or disagreement among
the Lenders with respect to their exercise of their rights
under this Agreement, the relative rights and obligations of
the Lenders among themselves shall be determined pursuant to
the terms and procedures of the Participation Agreement, the
First Loan Documents and the Second Loan Documents.
b. Taking of Title. Unless the Lenders agree otherwise, if
the Lender(s) or anyone bidding on behalf of any Lender(s)
is/are the successful bidder at the Foreclosure sale, then
title to the Mall shall be taken in a single-asset corporation
owned by the Lenders in proportion to their relative interests
in the First Loan.
c. Phase I. Capital Growth shall promptly after the
Foreclosure Commencement Date order, and thereafter diligently
prosecute the completion of, an updated Phase I environmental
assessment for the Mall, and promptly provide State Street
with a copy thereof upon receipt. The cost of such Phase I
environmental assessment shall be treated as a cost of
enforcing the First Loan.
d. Prosecution of Foreclosure. Capital Growth shall promptly
commence and diligently prosecute the Foreclosure. Any change
of counsel with respect to the Foreclosure shall be subject to
approval by the Lenders, such approval not to be unreasonably
withheld. All papers to be filed in the Foreclosure shall be
subject to approval by the Lenders, such approval not to be
unreasonably withheld.
e. Participation. Provided that State Street (as originally
defined in the Complaint) continues to hold its existing
interest in the First Loan (or the Mall, directly or
indirectly, as the result of the Foreclosure) ("State Street
Ownership"), and only so long as State Street Ownership
continues, upon the taking of title to the Mall by or on behalf
of the Lenders, the Participation Agreement shall be deemed
modified so that State Street shall thereafter become Lender,
and Capital Growth shall thereafter become Participant, but
only for so long as State Street Ownership continues, except
that their respective ownership interests (i.e., 76% ownership
by State Street, 24% ownership by Capital Growth) shall remain
unchanged. Upon termination of State Street Ownership, the
Lenders shall reasonably agree upon a third-party asset manager
to manage the Mall (if owned by the Lenders) on behalf of the
Lenders, both Lenders confirming that an asset management
affiliate of General Electric Capital Corporation is
acceptable.
24. Limitation of Liability. Notwithstanding anything to the
contrary in this Agreement, no Lender's liability to any
Borrower Party under this Agreement shall extend beyond such
Lender's interest in the Mall (including, in the case of each
Lender, its interest in the First Loan or the Second Loan, as
applicable), and the proceeds thereof. Any judgment obtained
by any Borrower Party against any Lender shall not be enforced
against any assets of such Lender other than the foregoing.
Subject to the terms of this Agreement, the liability of any
Borrower Party under this Agreement shall be subject to the
same limitations of any such Borrower Party's liability that
would apply to such Borrower Party's liability under the Loan
Documents.
If the foregoing accurately reflects our understanding, please
sign and return at least one counterpart of this Agreement to
us.
Thank you.
Laurel Owner
LAUREL OWNER PARTNERS LIMITED PARTNERSHIP, a
Maryland limited partnership
By: SHOPCO LAUREL CENTRE, L.P., a Delaware limited
partnership, its general partner
By: LAUREL CENTRE INC., its general
partner
By:
Name:
Title:
Agreed to and accepted.
Capital Growth
CAPITAL GROWTH MORTGAGE INVESTORS, L.P., a Delaware limited
partnership
By: CG REALTY FUNDING, INC., a Delaware corporation
By:
Xxxxxxx X. Xxxxx, President
Agreed to and accepted.
State Street
STATE STREET BANK AND TRUST COMPANY, a Massachusetts business trust
By: GE CAPITAL REALTY GROUP, INC., as Sub-Servicer for GE CAPITAL ASSET
MANAGEMENT CORPORATION, as Servicer for State Street Bank and Trust
Company
By:
Name:
Title:
Agreed to and accepted.
CBA
CBA MORTGAGE CORP.
By:
Name:
Title:
Attachment: Index of Terms Defined in This Agreement
INDEX OF TERMS DEFINED IN THIS AGREEMENT
Adverse Allegations
Agreement
Borrower Cash
Borrower Interference
Borrower Parties
Borrower Release Date
Complaint
Court
Disclosure
Existing Manager
Foreclosure
Foreclosure Commencement Date
Lenders
Litigation
Litigation Activity
Management Materials
Management Transition Date
New Manager
Outside Date
Partnership Expenses
Pre-Foreclosure Payables
Related Releasees
Revenue
Special Distribution
Standstill Period
Standstill Termination Date
State Street Ownership
TRO
Waterfall
Other terms used in this Agreement are defined in the Complaint
