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LOAN AGREEMENT
THIS LOAN AGREEMENT is made this 4th day of April, 1996, BY AND BETWEEN
PIDC FINANCING CORPORATION, a nonprofit corporation organized and existing under
and by virtue of the laws of the Commonwealth of Pennsylvania, with an address
at 0000 Xxxxxx Xxxxxx Xxxx, 0000 Xxxxxx Xxxxxx, Xxxxxxxxxxxx, Xxxxxxxxxxxx 00000
(the "Borrower"), and THE PENNSYLVANIA INDUSTRIAL DEVELOPMENT AUTHORITY
("PIDA"), a public body corporate and politic, organized and existing under and
by virtue of the laws of the Commonwealth of Pennsylvania, having its principal
place of business at Room 000 Xxxxx Xxxxxxxx, Xxxxxxxxxx, Xxxxxxxxxxxx 00000.
ARTICLE I
Background
Section 1.01. The Borrower, to facilitate the financial transactions
referred to herein, has acquired or is acquiring as of the date hereof legal
title to a tract of land in Philadelphia, Philadelphia County, Pennsylvania
(hereinafter called the "Premises") upon which the Borrower proposes to
establish an industrial development project as defined in the Pennsylvania
Industrial Development Authority Act, as amended, 73 P.S. section 301 et seq.
(the "Act") (the "Project") to be purchased or leased, occupied and controlled
by MOTHERS WORK, INC. (the "Industrial Occupant"), a corporation organized and
existing under the laws of the State of Delaware and qualified to do business in
Pennsylvania, pursuant to an Installment Sale Agreement, effective as of April
4, 1996, between the Borrower and the Industrial Occupant (the "Premises
Agreement").
Section 1.02. The Borrower has filed with PIDA an application for financing
for the Project (as amended through the date hereof, the "Application") and
accepted from PIDA a commitment letter dated March 13, 1995 (as amended, the
"Commitment") for a loan in a principal amount not to exceed $2,000,000 (the
"Loan") to be used exclusively to defray a portion not to exceed 40% (such
maximum percentage, the "Participation Percentage") of the "cost of establishing
an industrial development project" as defined in the Act (the "Cost").
Section 1.03. PIDA is willing to make the Loan upon the terms and subject
to the conditions hereinafter set forth.
NOW, THEREFORE, the parties hereto, in consideration of the mutual promises
herein contained, and intending to be legally bound hereby, covenant and agree
as follows:
ARTICLE II
The Loan
Section 2.01. The Loan. Subject to the conditions set forth herein, PIDA
agrees to make the Loan to the Borrower for the purpose of defraying a portion
of the Cost.
ARTICLE III
The Note
Section 3.01. The Note. The Loan shall be evidenced by a note (the "Note")
of even date herewith given by Borrower to PIDA in a principal amount equal to
the principal amount referred to in Section 1.02 hereof.
ARTICLE IV
Loan Security
Section 4.01. The Mortgage. Payment of the Note and satisfaction of all
obligations of the Borrower hereunder and under the Note and of the Industrial
Occupant under a Consent, Subordination and Assumption Agreement effective as of
even date herewith from the Industrial Occupant to PIDA (the "Assumption
Agreement") shall be secured by a mortgage (the "Mortgage") effective as of even
date herewith given by Borrower to PIDA. The Mortgage shall constitute not less
than a second lien upon the Premises, subordinate only to a $4,094,684.93
mortgage, dated September 28, 1995, on the Premises given to MERIDIAN BANK which
principal sum shall be reduced to the sum of $4,000,000 on the same date hereof
(the "First Mortgage").
Section 4.02. Additional Security. The following shall constitute
additional collateral security for the payment of the Note and satisfaction by
the Borrower of all of the Borrower's obligations hereunder and under the
Mortgage and/or the obligations of the Industrial Occupant under the Assumption
Agreement:
(a) the Assumption Agreement given by the Industrial Occupant to PIDA;
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(b) an Assignment by Borrower to PIDA of Borrower's rights under the
Premises Agreement which Assignment is subordinate to a prior Assignment to
MERIDIAN BANK (the "Assignment"), agreed to by the Industrial Occupant; and
(c) a bank letter of credit in the amount of $1,000,000.
This Agreement, the Note, the Mortgage, the Premises Agreement, the
Assignment, the Assumption Agreement, the opinions of counsel hereinafter
referred to, and all other agreements, instruments and documents to be delivered
hereunder shall collectively be termed the "Loan Documents."
ARTICLE V
Representations and Warranties of Borrower
To induce PIDA to enter into this Agreement and to make the Loan, the
Borrower represents and warrants that:
Section 5.01. Corporate Organization. The Borrower is a nonprofit
corporation, duly organized, validly existing and in good standing under the
laws of the Commonwealth of Pennsylvania.
Section 5.02. Power and Authority. The Borrower has all necessary corporate
power and authority to purchase, own, mortgage and sell its properties and to
carry on its business as now being conducted, and to carry out the transactions
contemplated by the Loan Documents.
Section 5.03. Certification as Industrial Development Agency. Borrower is
an industrial development agency as that term is defined in the Act certified as
such by PIDA. Borrower is not aware of any facts that would make its application
to PIDA for certification as an industrial development agency materially
incomplete, incorrect or misleading if filed as of the date hereof. Borrower has
filed with PIDA all reports and other information required by PIDA.
Section 5.04. Loan Documents Consistent with Law and Agreements. The
execution and delivery of this Agreement and of each of the Loan Documents to be
executed and delivered by Borrower, consummation of the transactions herein
contemplated, and compliance with the terms and provisions hereof and of the
Loan Documents which Borrower has executed and delivered or to which it is
otherwise subject do not (i) contravene any provision of law, statute, rule or
regulation to which Borrower is subject or any judgment, decree, franchise,
order or permit applicable to the Borrower or (ii) conflict with, or result in,
a breach of any of the terms, conditions or provisions of the
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Articles of Incorporation or Bylaws of the Borrower, or of any material
agreement, indenture or other instrument to which the Borrower is a party or by
which it is bound or to which it or its property is subject.
Section 5.05. Due Authorization. The execution, delivery and performance of
this Agreement, the performance of the transactions contemplated by the
provisions hereof, and the execution, issuance, delivery and performance of each
of the Loan Documents to be executed and delivered by Borrower hereunder have
each been duly authorized by all necessary corporate action on the part of the
Borrower.
Section 5.06. Execution and Delivery. This Agreement and each of the Loan
Documents being executed and delivered by Borrower concurrently herewith have
been duly and validly executed and delivered by the Borrower and constitute
valid and legally binding obligations of the Borrower, enforceable in accordance
with their respective terms, except as the enforceability thereof may be limited
by bankruptcy, insolvency or other substantially similar laws of general
application relating to or affecting the enforcement of creditors' rights or by
general principles of equity.
Section 5.07. Litigation. There is no material litigation or governmental
proceeding pending or, to the knowledge of the Borrower, threatened against the
Borrower other than that which has been previously disclosed to PIDA in writing.
If such litigation or proceeding exists, it shall be set forth in an exhibit
which shall be attached hereto and made a part hereof.
Section 5.08. Taxes. The Borrower has filed all required federal, state and
local tax returns and has paid all taxes shown on such returns as they have
become due unless the obligation to file such return or pay such tax is the
subject of a pending administrative or judicial appeal or proceeding with
respect to which the Borrower has posted or caused to be posted a bond or other
security satisfactory to PIDA in an amount which is at least equal to the sum
which is the subject of the appeal or proceeding, together with all interest,
costs, and charges relating thereto.
Section 5.09. Infrastructure Improvements. Adequate street and public
infrastructure improvements, including without limitation water and sanitary and
surface sewers, in and about the Project (i) have been fully authorized or
approved by appropriate ordinance or other required municipal action and (ii)
have either (A) been completed, (B) are the subject of contracts being let by
the municipality involved, (C) are covered by a bond that the Borrower has
posted with the municipality in an amount deemed sufficient by the municipality
to secure the completion of such improvements; or (D) are otherwise available at
the Premises for the use and benefit, inter alia, of PIDA.
All of the representations and warranties of the Borrower set forth herein
are expressed as of the date hereof, unless a specific date prior to the date
hereof is given as the date as of which such representation or warranty is
expressed, and
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shall survive and continue until the Loan is paid in full and all of the
Borrower's obligations hereunder have been satisfied.
ARTICLE VI
Borrowing Procedures and Agreements
The following provisions shall be applicable with respect to all
disbursements of the Loan, whether made concurrently with Closing hereunder or
subsequent thereto:
Section 6.01. General Disbursement Procedures. Disbursement of the Loan
will be made in accordance with the Commitment. Disbursements shall be made only
to pay for work performed and materials incorporated into the Project and
comprising part of the Cost of the Project.
Requests for all disbursements under the Loan shall be submitted to PIDA in
writing, shall consist of such documentation and contain such information as may
be reasonably required by PIDA concerning the Project and the Cost (or the
portion thereof theretofore paid or invoiced) and shall be accompanied by such
other documentation as may be reasonably required by PIDA or its counsel. Such
requests shall be submitted in sufficient time prior to the date upon which the
Borrower requests that a disbursement under the Loan be made hereunder to enable
PIDA to process such request, but in any event not less than 30 days prior to
the proposed date of such disbursement.
Section 6.02. Subsequent Disbursements. In the event that the Project is
not completed and the entire Loan is not disbursed at the time of the initial
disbursement hereunder, subject to compliance by the parties subject thereto
with the terms and conditions of this Agreement and each of the other Loan
Documents, the Borrower shall be entitled after completion of construction of
the Project to borrow the undisbursed balance, if any, of the Loan, provided
that the total Cost of the Project multiplied by the Participation Percentage
exceeds the amount of the Loan.
Section 6.03. Conditions Precedent to All Disbursements. As a condition
precedent to each disbursement hereunder, whether made concurrently with Closing
or subsequent thereto, the Borrower shall, in addition to satisfying such other
requirements as PIDA may reasonably impose, provide PIDA with:
(a) evidence satisfactory to PIDA that, at the time of such
disbursement (unless with respect to items (i), (ii) and (iii), such items
are covered by an acceptable title insurance commitment delivered to PIDA
as of the date hereof, and applicable at the time of such disbursement),
(i) there are no mechanics' or materialmen's liens or claims filed against
the Premises, (ii) no financing statements have been filed under the
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Uniform Commercial Code as then in effect in the Commonwealth with respect
to fixtures or building systems (including, but not limited to, heating,
plumbing, electrical, air conditioning, sprinkler, fire alarm and elevator
systems) not directly employed in the industrial activities of the
Industrial Occupant, which would have priority over the lien in favor of
PIDA created by the Mortgage other than those specifically permitted by the
Mortgage or hereunder, (iii) there are no liens or encumbrances filed or
recorded with respect to the Premises which would have priority over the
lien in favor of PIDA created by the Mortgage other than those specifically
permitted by the Mortgage or hereunder, (iv) the Industrial Occupant has
filed all tax returns and reports required to be filed by it with the
Commonwealth through the date hereof and is current in the payment of all
monies due to the Commonwealth from it, whether as taxes or otherwise,
unless the obligation to file such return or pay such tax is the subject of
a pending administrative or judicial appeal or proceeding with respect to
which the Industrial Occupant has posted or caused to be posted a bond or
other security satisfactory to PIDA in an amount which is at least equal to
the sum which is the subject of the appeal or proceeding, together with all
interest, costs, and charges relating thereto and (v) the insurance
relating to the Project required by the Mortgage is in effect;
(b) a certificate of the Borrower executed by its President or Vice
President dated as of the disbursement date certifying that all
representations and warranties made herein with regard to the Borrower were
true and correct as of the date hereof and shall remain true and correct as
of the date of such certificate, unless some date other than the date
hereof is expressly set forth as of the date as of which such
representation and warranty is expressed, in which event such
representation and warranty was true and correct as of the effective date
thereof; and
(c) a certificate of the Industrial Occupant executed by an authorized
officer dated as of the disbursement date that: (i) all representations and
warranties made in the Assumption Agreement were true and correct as of the
date hereof and shall remain true and correct as of the date of such
certificate, unless some date other than the date hereof is expressly set
forth as of the date as of which such representation and warranty is
expressed, in which event such representation and warranty was true and
correct as of the effective date thereof and (ii) the Premises and the
Project are in compliance in all material respects with all environmental,
building, subdivision, zoning and all other ordinances and regulations
applicable to the Premises and the Project respectively, together with
copies of all subdivision, building, zoning, use and other permits required
for the Premises and the Project unless PIDA shall permit the omission of
such copies.
Section 6.04. Suspension of Disbursements. In the event any material
environmental, building, subdivision, use, zoning or other permits relating to
the Premises or the construction or operation of the Project are revoked,
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rescinded, suspended or materially adversely affected by any preliminary or
final injunction or decision by any court or other body issuing such permit or
otherwise having jurisdiction, PIDA may refuse to make further advances under
this Agreement until the matter is resolved to PIDA's reasonable satisfaction,
whether or not PIDA has declared an Event of Default hereunder or such
revocation, rescission, suspension, or material adverse effect would comprise an
Event of Default hereunder.
ARTICLE VII
Covenants of the Borrower
Until the Loan has been entirely repaid and all of its obligations to PIDA
in connection therewith and herewith have been satisfied, the Borrower hereby
covenants that:
Section 7.01. Use of Proceeds. The Borrower shall use the proceeds of the
Loan solely for the purpose of defraying the Cost.
Section 7.02. Preservation of Existence. The Borrower shall preserve its
corporate existence, rights, privileges and franchises, and maintain its good
standing as a nonprofit corporation under the laws of the Commonwealth of
Pennsylvania and its certification by PIDA as an industrial development agency.
Section 7.03. Compliance with Law. The Borrower shall comply with all laws,
regulations and orders of any court or governmental body having jurisdiction
over the Project. To the extent Borrower is required to do so by applicable law
or by agreement with the Industrial Occupant, Borrower shall obtain all
environmental, zoning, subdivision, building and other permits required for
completion of the Project. To the extent that such permits are (i) required for
the Project but (ii) pursuant to agreement with the Industrial Occupant and in
accordance with applicable law are being obtained by Industrial Occupant or some
other person other than Borrower, Borrower shall in its agreements with the
Industrial Occupant require the Industrial Occupant to obtain such permits and
Borrower shall thereafter exercise reasonable diligence to determine whether
such permits are being timely and appropriately obtained, and shall promptly
advise PIDA if Borrower believes such permits are not being so obtained. As and
when requested by PIDA, Borrower shall deliver to PIDA copies of all permits
required for completion of the Project.
Section 7.04. Provision of Information. The Borrower shall, not less
frequently than annually and at such other times as PIDA may reasonably request,
provide financial information and other information in form reasonably
satisfactory to PIDA, including at least (i) financial statements of the
Borrower for its most recent fiscal year, including its balance sheet and income
statement, duly certified by an authorized officer of the Borrower and (ii) a
certificate of
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an authorized officer of the Borrower stating (A) that it has complied
with all terms and conditions of each of the Loan Documents to which the
Borrower is subject, including, without limitation, the requirements of the
Mortgage with respect to insurance on the Premises and (B) that it has complied
with its bylaws with respect to the holding of regular and annual meetings and
the election of officers.
Section 7.05. Compliance with Loan Documents. The Borrower shall comply
with all of the terms and conditions of this Agreement and each of the Loan
Documents to be executed and delivered by Borrower.
Section 7.06. Notice of Defaults. The Borrower shall give immediate notice
to PIDA of the occurrence of (i) any breach or Event of Default on the part of
Borrower, (ii) any breach or Event of Default on the part of Industrial Occupant
of which Borrower becomes aware, under this Agreement or under any Loan
Document, or (iii) any material breach or Event of Default by any other person
of which Borrower becomes aware, under any other material agreement relating to
the Project.
Section 7.07. Enforcement of Terms Against Industrial Occupant. The
Borrower shall specifically enforce, as and to the extent PIDA shall request,
all material provisions of all agreements between the Borrower and the
Industrial Occupant relating to the Project and shall not waive any material
breach of, or material default under, any of such agreements of which Borrower
becomes aware, without the prior written consent of PIDA.
Section 7.08. Mergers, etc. Without the prior written consent of PIDA, the
Borrower shall not merge or consolidate with any other corporation or other
entity, unless Borrower is the surviving corporation, nor divide into two or
more corporations, nor convey, transfer or dispose of all or any material part
of its assets.
Section 7.09. Debt Secured by Premises. Without the prior written consent
of PIDA, the Borrower shall not take any action to cause or permit any mortgage,
lien or encumbrance to be placed against the Premises or any interest therein,
including without limitation the equitable interest of the Industrial Occupant
therein, except such mortgages, liens and encumbrances as may be expressly
permitted by the Mortgage. Borrower shall, in its agreements with the Industrial
Occupant, prohibit the Industrial Occupant from causing or permitting any
mortgage, lien or encumbrance to be placed against the Premises or any interest
therein, including without limitation the equitable interest of the Industrial
Occupant therein.
Section 7.10. Extensions and Prepayments of Premises Debt. Without the
prior written consent of PIDA, the Borrower shall not request, consent to, or
enter into any agreement providing for, the extension of the time of payment of
the First Mortgage. Borrower shall in its agreements with the Industrial
Occupant prohibit the Industrial Occupant
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from requesting, consenting to or entering into any agreement providing for
the extension of the time of payment of the First Mortgage without the prior
written consent of PIDA and the Borrower. The Borrower may prepay the First
Mortgage in whole or in part at any time provided that (i) such prepayment does
not materially adversely affect the financial condition of the Borrower or the
Industrial Occupant, (ii) prior written notice of such prepayment is given to
PIDA and (iii) there is no default or event which with the passage of time or
giving of notice would constitute a default under the Mortgage. The Borrower
shall not, without the prior written consent of PIDA, prepay any indebtedness
secured by a lien on the Premises which is subordinate to the Mortgage. Borrower
shall in its agreements with the Industrial Occupant prohibit the Industrial
Occupant from requesting, consenting to or entering into any agreement providing
for, the prepayment of any indebtedness secured by a lien on the Premises or any
interest therein which is subordinate to the Mortgage without the prior written
consent of PIDA and the Borrower.
Section 7.11. Nondiscrimination. The Borrower hereby accepts and agrees to
be bound by the nondiscrimination provisions set forth in Exhibit 7.11 attached
hereto. The Borrower shall cause comparable provisions to be included in the
Premises Agreement and all other Project contracts to which Borrower is a party
and shall, in the agreements to which Borrower is a party with the Industrial
Occupant and all other persons relating to the Project (including, without
limitation, contractors and professionals), require the insertion of comparable
provisions in all Project contracts to which the Industrial Occupant or such
other persons are party.
Section 7.12. Compliance with Governmental Requirements. Borrower shall
require, in all Project contracts to which Borrower is a party, (i) that the
Project be in compliance with all applicable governmental regulations, including
without limitation all anti-pollution regulations and standards, and (ii) that
comparable provisions be included in all other Project contracts to which
persons, who are parties to Project contracts with the Borrower, are themselves
a party.
Section 7.13. Recording and Other Costs. The Borrower shall pay all the
costs of recording and any other costs that PIDA may incur in connection with
closing the Loan, to the extent such costs are not paid by Industrial Occupant.
Section 7.14. Inspection. The Borrower shall in its agreements with the
Industrial Occupant require the Industrial Occupant to provide proper facilities
at all times for inspection of the Project before and after completion thereof
by PIDA and PlDA's authorized representatives (including, without limitation,
any independent consulting engineer (such engineer, the "PIDA Engineer") or
environmental consultant retained by PIDA), and afford full and free access to
the Project to such persons as may from time to time be designated by PIDA.
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Section 7.15. Documentation. The Borrower shall provide, or, by agreement
with the Industrial Occupant, require the Industrial Occupant to provide, all
documentation requested by the PIDA Engineer for preparation of the final
engineering report, including, but not limited to, such things as a breakdown of
the final costs with invoices, proofs of payment, and a final affidavit
of costs.
Section 7.16. Completion of Project. The Borrower shall by agreement with
the Industrial Occupant or otherwise require that the Project be constructed on
the Premises, in strict accordance with all plans and specifications delivered
to PIDA; that all fixtures, equipment and other property constituting a part of
the Premises be timely acquired and installed; and that construction proceed
diligently, continuously and expeditiously, employing sufficient workmen and
supplying sufficient materials to fully finish and complete the same, inside and
outside, with the appurtenant areas, paving, grading and curbing, sewers,
laterals, water and all public utility connections and all necessary street,
footway and other improvements, free and clear and discharged of all liens and
municipal claims and the possibility of liens therefor.
Section 7.17. Removal of Work Deemed Unsound. The Borrower shall, by its
own action or by agreement with the Industrial Occupant, take down and remove
from, or require the taking down and removal from, the Premises, within
seventy-two (72) hours after receiving notice from PIDA, all portions of the
Project and related materials, whether worked or unworked, which, after
inspection by the PIDA Engineer, are determined by the PIDA Engineer to be
materially not in compliance with the PIDA Engineering Guidelines supplied to
the Borrower in connection with the Project, and make good, at no cost to PIDA,
all work and materials damaged thereby.
ARTICLE VIII
Payments
Section 8.01. Repayment of Excess Loan Amounts. If, upon final
determination by the PIDA Engineer of the Cost of the Project, excluding Costs
attributable to any portion of the Project determined by the PIDA Engineer to be
materially not in compliance with the PIDA Engineering Guidelines supplied to
the Borrower in connection with the Project (which determination shall be
conclusive), the amount of the Loan previously disbursed to the Borrower exceeds
the Cost (as so determined) multiplied by the Participation Percentage, the
entire amount of such excess shall be repaid to PIDA by or on behalf of the
Borrower within thirty (30) days of notice thereof to the Borrower and the
Industrial Occupant.
Section 8.02. Payments of Premises Rentals. Whether or not PIDA consents to
such lease or sublease, if any portion of the Premises is leased or subleased to
any party not substantially related to the Industrial Occupant, Borrower
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shall pay or cause to be paid to PIDA, as a prepayment on the Loan, on the
first anniversary of the commencement of the lease or sublease and annually
thereafter, fifty percent (50%) of (i) the gross annual rentals or subrentals
less only (ii) the proportionate amount of taxes, insurance and utilities
allocable to the portion of the Premises so leased or subleased. If PIDA shall
not have consented in advance to such lease or sublease, acceptance by PIDA of
such prepayment shall be without prejudice to any right PIDA may have to declare
an Event of Default hereunder.
ARTICLE IX
Events of Default
Section 9.01. Events of Default. The following shall each constitute an
event of default hereunder (an "Event of Default"):
(a) there shall not have been paid when due any amount payable by any
person under any of the Loan Documents (including, without limitation, any
installment of principal or interest under the Note or any prepayment under
Article VIII hereof), and such failure shall continue for a period of
thirty (30) days;
(b) any representation, warranty or statement made by any person
herein or in the Application or in any of the Loan Documents or in any
certificate or financial or other statement furnished pursuant to the
provisions of any of the Loan Documents or the Application (except for any
representation, warranty or statement expressly made effective as of a date
prior to the date when made or furnished), shall have been false or
misleading in any material respect as of the time made or furnished or as
of the date hereof, whichever is later; any representation, warranty or
statement expressly made effective as of a date prior to the date when made
or furnished shall have been false or misleading in any material respect as
of the effective date thereof;
(c) the Borrower or the Industrial Occupant shall (i) become
insolvent, (ii) admit its inability to pay its debts as they come due,
(iii) make an assignment to the benefit of its creditors, (iv) be
adjudicated bankrupt or insolvent, (v) voluntarily initiate proceedings
under any bankruptcy or reorganization law either now or hereafter in
effect, (vi) become the subject of any involuntary proceedings under any
bankruptcy or reorganization law either now or hereafter in effect that
shall not have been dismissed within ninety (90) days of the initiation
thereof, or (vii) seek to take advantage of any moratorium law either now
or hereafter in effect;
(d) a receiver, liquidator or trustee shall be appointed for either
the Borrower or the Industrial Occupant and shall not have been dismissed
within ninety (90) days;
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(e) the Premises or any interest therein are sold, leased, sub-leased,
mortgaged, liened, encumbered, or otherwise conveyed without the prior
written consent of PIDA, which consent will not unreasonably be withheld,
provided that (i) the beneficial owner and occupant of the Premises remain
substantially related to each other, (ii) the Project remains in
substantial use for a PIDA-Eligible purpose (as defined in the Assumption
Agreement), (iii) the beneficial owner and occupant remain financially
responsible, and (iv) the security for the Loan is not impaired;
(f) any building, subdivision, use, zoning, environmental or other
permit material to the construction of the Project or the use thereof as
contemplated in the Application shall be effectively revoked, rescinded,
suspended or materially adversely affected or the use of the Project as
contemplated in the Application shall have been effectively enjoined or
prohibited;
(g) there shall have occurred and be continuing, after giving effect
to any applicable notice and cure periods, an Event of Default as defined
in any of the Loan Documents by any party subject thereto; or
(h) a material failure to comply by any party subject thereto with any
covenant of this Agreement or any of the Loan Documents, including, but not
limited to, the failure to provide job information, insurance information,
and annual financial statements required by PIDA under those instruments,
shall occur and be continuing after written notice of such failure has been
given to such party, with a copy to Borrower, for thirty (30) days or, if
such failure shall not be capable of being cured within thirty (30) days,
and curative action shall have been initiated within such 30 day period and
pursued diligently thereafter, for such time period after notice of such
failure has been given to such party, with a copy to Borrower, as shall, in
the good faith judgment of PIDA, which shall be conclusive, be required for
such cure.
Section 9.02. Remedies Upon Event of Default. Immediately and without
further notice to any person (including, without limitation, the Borrower or the
Industrial Occupant), upon the occurrence of an Event of Default hereunder other
than (i) an Event of Default arising solely from a breach by the Industrial
Occupant of Section 4.03 "Operations and Number of Jobs" of the Assumption
Agreement, pertaining to job creation or retention, or (ii) an Event of Default
arising solely from the internal operations of the Borrower over which the
Industrial Occupant has no control, during which the Industrial Occupant has
paid all amounts required to be paid by them and performed all acts required to
be performed by them under each of the Loan Documents, PIDA may exercise any one
or more of the following remedies:
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(a) declare the Note and all liabilities of the Borrower thereunder to
be immediately due and payable, and the same shall thereupon become and be
due and payable;
(b) raise the rate of interest on the Loan as provided in the Note;
(c) foreclose on the Mortgage;
(d) bring an action (which may be by confession of judgment to the
extent permitted by the particular instrument) against the Borrower under
the Note and/or the Mortgage, against the Industrial Occupant under the
Assumption Agreement and/or the Premises Agreement, as assigned to PIDA by
the Assignment;
(e) bring an action of ejectment to recover possession of the
Premises; and/or
(f) exercise any other remedy available to it under any of the Loan
Documents or applicable law.
Except as expressly required by the particular Loan Document pursuant to
which such remedies are exercised or by applicable law, PIDA may exercise any of
the foregoing remedies without presentment, demand, protest or notice of any
kind to any person (including, without limitation, the Borrower or the
Industrial Occupant), all of which are hereby expressly and knowingly waived.
Subject solely to the limitation that PIDA is limited to one recovery for
the aggregate amounts due and owing under the Loan Documents, PlDA's remedies
under the Loan Documents are cumulative and concurrent and may, in PlDA's sole
discretion, be exercised, deferred, compromised, settled or discontinued without
affecting any other remedy available to PIDA under any of the Loan Documents or
under applicable law.
Notwithstanding anything to the contrary herein contained, so long as the
Industrial Occupant shall keep and perform all the provisions, covenants and
conditions to be assumed or performed by the Industrial Occupant respectively
under the Loan Documents, including the payment of all amounts due thereunder
and performance of all obligations set forth therein, PIDA shall not terminate,
impair or otherwise adversely affect the rights of the Industrial Occupant
thereunder. It is further agreed that PIDA shall use its best efforts to supply
the Industrial Occupant with a copy of each notice required to be supplied to
Borrower hereunder, but failure to so supply copies of such notices shall not
adversely affect any right of PIDA hereunder.
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Section 9.03. Remedies for Event of Default Arising From Internal
Operations of Borrower. Upon the occurrence of an Event of Default arising
solely from the internal operations of the Borrower over which the Industrial
Occupant has no control, during which the Industrial Occupant and any Guarantor
have paid all amounts required to be paid by them and performed all acts
required to be performed by them under each of the Loan Documents, PIDA may
(i) suspend or revoke the certification of the Borrower as an Industrial
Development Agency under the Act, or (ii) initiate or participate or intervene
in any action or legal proceeding (including, without limitation, any action or
proceeding under the U.S. Bankruptcy Code) to (A) compel compliance with the
terms of the Loan Documents, (B) to appoint a trustee or receiver for Borrower
or to dissolve, reorganize or liquidate Borrower, or (C) otherwise to protect
the interests of PIDA and/or the Industrial Occupant.
Section 9.04. Remedies for Event of Default Arising From Failure to Create
or Preserve Jobs. Upon the occurrence of an Event of Default arising solely from
a breach by the Industrial Occupant of Section 4.03 "Operations and Number of
Jobs" of the Assumption Agreement, PIDA may, in compliance with such regulations
and statements of policy, if any, as are then in effect, raise the rate of
interest on the Loan as permitted under the Note.
ARTICLE X
Miscellaneous
Section 10.01. Obligations Unconditional. The obligations to PIDA under
this Agreement and each of the Loan Documents shall be absolute and
unconditional without defense or set-off by reason of any default by the
contractors under the contracts relating to the Project or by PIDA under this
Agreement, any of the Loan Documents, or under any other agreement between the
Borrower or the Industrial Occupant and PIDA, or for any other reason, including
without limitation failure to complete the Project, any acts or circumstances
that may constitute failure of consideration, destruction of or damage to the
Project, commercial frustration of purpose, or failure of PIDA to perform and
observe any agreement, whether express or implied, or any duty, liability or
obligation arising out of or connected with this Agreement, it being the
intention of the parties that the payments required under each of the Loan
Documents will be paid in full when due without any delay or diminution
whatsoever. Payments and additional sums required to be paid to PIDA under any
of the Loan Documents shall be received by PIDA as net sums and the Borrower
agrees to pay or cause to be paid all charges against or which might diminish
such net sums. The provisions of this Section shall not impair the ability of
the Borrower or any other persons to bring an independent action against PIDA
with respect to any cause of action such person may have against PIDA.
Section 10.02. Provisions Complementary. The provisions of this Agreement
shall be in addition to those of any other Loan Document. All of such provisions
shall be construed as complementary to each other. Nothing
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contained herein shall prevent PIDA from enforcing any and all of such
provisions in accordance with their respective terms.
Section 10.03. Rights and Remedies. The terms of all Loan Documents shall
be liberally construed in favor of PIDA to effectuate the purposes hereof. No
delay or failure on the part of PIDA in exercising any right, power or privilege
under any of the Loan Documents shall affect such right, power or privilege; nor
shall any single or partial exercise thereof or any abandonment, waiver, or
discontinuance of steps to enforce such a right, power or privilege preclude any
other or further exercise thereof, or the exercise of any other right, power or
privilege. The rights and remedies of PIDA under any of the Loan Documents are
cumulative and concurrent and not exclusive of any rights or remedies which PIDA
might otherwise have. PIDA shall have the right at all times to enforce the
provisions of each of the Loan Documents and all related documentation in strict
accordance with the terms hereof and thereof, notwithstanding any conduct or
custom on the part of PIDA in refraining from so doing at any time or times. The
failure of PIDA at any time or times to enforce PIDA's rights under such
provisions, strictly in accordance with the same, shall not be construed as
having created a custom in any way or manner contrary to specific provisions of
such Loan Documents or any such documentation, or as having in any way or manner
modified or waived the same.
Section 10.04. Writing Required. Any permit, consent or approval of any
kind or character on the part of PIDA under any of the Loan Documents, and any
waiver of any provision or condition thereof, must be in writing and executed by
PIDA and shall be effective only to the extent specifically set forth in such
writing.
Section 10.05. Duration of Covenants. All covenants and agreements of the
Borrower or the Industrial Occupant in any of the Loan Documents, or otherwise
made in writing in connection herewith, shall survive and continue until the
Loan is entirely paid and all of the Borrower's obligations hereunder have been
entirely satisfied, unless a longer term is expressly provided for, in which
event such longer term shall apply.
Section 10.06. Pennsylvania Law to Govern. Each of the Loan Documents shall
be deemed to be contracts made under the laws of the Commonwealth of
Pennsylvania and, for all purposes, shall be construed in accordance with the
laws of such Commonwealth.
Section 10.07. Counterparts. Each of the Loan Documents may be executed in
as many counterparts as may be deemed necessary and convenient and each of
which, when so executed, shall be deemed an original, but all such counterparts
shall constitute but one and the same instrument. All signatures need not appear
on the same copy of any Loan Document.
15
Section 10.08. PIDA Project Inspections Solely for PlDA's Benefit. It is
understood and agreed that PIDA, its agents, servants, invitees and employees,
may inspect the plans and specifications for the Project and enter the Premises
and conduct such tests, surveys, examinations and inspections (collectively,
"Project Inspections") as it shall, from time to time, deem appropriate. The
Borrower hereby acknowledges and agrees (i) that such Project Inspections are
solely for the protection and benefit of PIDA; (ii) that PIDA, its agents,
servants, invitees and employees including, without limitation, the PIDA
Engineer carry no responsibility whatsoever for the design or construction of
the Project, its quality or the compliance or lack of compliance with the plans
and specifications, (iii) that any engineering report issued by the PIDA
Engineer as to the quantity and quality of work is for the benefit of PIDA only
and (iv) that the engineering certifications by the PIDA Engineer are not
certifications of compliance by the contractor with the building specifications
or of the quality of the work, nor are they intended as construction
supervision.
Section 10.09. Setoff. The Borrower agrees that the Commonwealth of
Pennsylvania may set off the amount of any state tax liability or other debt of
the Borrower or its respective subsidiaries that is owed to the Commonwealth and
not being contested on appeal against any payments due the Borrower under this
or any other contract with the Commonwealth.
Section 10.10. Borrower Responsibility. Included in and made a part of this
Agreement is Exhibit 10.10, a clause pertaining to Borrower Responsibility.
Section 10.11. Borrower Integrity. The Borrower represents, warrants and
covenants that it currently has no interest and shall not acquire any interest,
direct or indirect, which would conflict in any manner or degree with the
performance of its obligations hereunder. Included in and made a part of this
Agreement is Exhibit 10.11, a clause pertaining to Borrower Integrity.
Section 10.12. Americans with Disabilities Act. Included in and made a part
of this Agreement is Exhibit 10.12, a clause pertaining to compliance with the
Americans with Disabilities Act.
Section 10.13. Successors and Assigns. This Agreement and each of the Loan
Documents shall inure to the benefit of, and shall be binding upon, the
respective successors and assigns of PIDA and the Borrower. Although PIDA has no
present intention to convey, pledge or otherwise assign its rights under the
Loan Documents, it may nevertheless do so in whole or in part without notice to
any person (including, without limitation, the Borrower and the Industrial
Occupant). The Borrower has no right to assign any of its rights or obligations
hereunder or under any of the Loan Documents without the prior written consent
of PIDA, and any such assignment without the prior written consent of PIDA shall
be void.
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The Borrower and PIDA intend that no person (other than Industrial
Occupant) shall have any claim or interest under this Agreement or right of
action hereunder.
Section 10.14. Notices. Notices required hereunder, or any correspondence
concerning this Agreement shall be directed to the following addresses and shall
be deemed properly given (a) if delivered by hand, (b) if sent by certified
mail, return receipt requested, postage prepaid, or by recognized overnight
courier service (including, without limitation, Federal Express or United Parcel
Service overnight service), charges prepaid; or (c) if sent by facsimile, with a
copy sent by first class U.S. Mail, postage prepaid.
To PIDA:
PENNSYLVANIA INDUSTRIAL DEVELOPMENT AUTHORITY
x/x Xxxxxxxxxx xx Xxxxxxxx
000 Xxxxx Xxxxxxxx
Xxxxxxxxxx, Xxxxxxxxxxxx 00000
FAX: (000) 000-0000
Attention: Executive Director
To Borrower:
PIDC FINANCING CORPORATION
0000 Xxxxxx Xxxxxx Xxxx
0000 Xxxxxx Xxxxxx
Xxxxxxxxxxxx, Xxxxxxxxxxxx 00000
Attention: President and Chief Executive Officer
Notices and communications hereunder shall be deemed sufficiently given
when dispatched pursuant to the foregoing provisions. Notices and communications
delivered by hand shall be effective upon receipt; notices and communications
sent by fax, with a copy by first class U.S. Mail, shall be effective upon
dispatch; notices and communications sent by recognized overnight courier
service shall be effective on the business day following dispatch; and notices
sent by certified mail shall be effective on the third business day following
dispatch. The parties hereto may, by a notice given hereunder, designate any
further or different addresses to which any subsequent notice or communication
hereunder shall be sent.
Section 10.15. Severability. If any provision hereof or of the Loan
Documents is found by a court of competent jurisdiction to be prohibited or
unenforceable in any jurisdiction, it shall be ineffective as to such
jurisdiction only to the extent of such prohibition or unenforceability, and
such prohibition or unenforceability shall not invalidate the balance of such
provision as to such jurisdiction to the extent it is not prohibited or
unenforceable, nor invalidate such provision in any other jurisdiction, nor
invalidate the other provisions of the Loan Documents, all of which shall be
liberally construed in favor of PIDA in order to effect the provisions of this
Agreement. Notwithstanding anything
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to the contrary herein contained, the total liability of the Borrower for
payment of interest pursuant hereto shall not exceed the maximum amount, if any,
of such interest permitted by applicable law to be contracted for, charged or
received, and if any payments by the Borrower to PIDA include interest in excess
of such a maximum amount, PIDA shall apply such excess to the reduction of the
unpaid principal amount due pursuant hereto, or if none is due, such excess
shall be refunded to the Borrower; provided that, to the extent permitted by
applicable law, in the event the interest is not collected, is applied to
principal or is refunded pursuant to this sentence and interest thereafter
payable pursuant hereto shall be less than such maximum amount, then such
interest thereafter so payable shall be increased up to such maximum amount to
the extent necessary to recover the amount of interest, if any, theretofore
uncollected, applied to principal or refunded pursuant to this sentence. Any
such application or refund shall not cure or waive any Event of Default. In
determining whether or not any interest payable under the Loan Documents exceeds
the highest rate permitted by law, any nonprincipal payment (except payments
specifically stated to be "interest") shall be deemed, to the extent permitted
by applicable law, to be an expense, fee, premium or penalty rather than
interest.
Section 10.16. Consent to Jurisdiction. The Borrower hereby irrevocably (a)
agrees that any suit, action or other legal proceeding arising out of or
relating to this Agreement or the Loan Documents may be brought in any federal
or state court located in or whose district includes Harrisburg, Pennsylvania or
the county wherein the Project is located and consents to the jurisdiction of
such court in any such suit, action or proceeding, and (b) waives any objection
which it may have to the laying of venue of any such suit, action or proceeding
in any such court and any claim that any such suit, action or proceeding has
been brought in an inconvenient forum. The Borrower hereby irrevocably consents
to the service of any and all process in any such suit, action or proceeding by
mailing of copies of such process to the Borrower at its address provided under
or pursuant to Section 10.14. The Borrower agrees that a final judgment in any
such action or proceeding shall be conclusive and may be enforced in other
jurisdictions by suit on the judgment or in any other manner provided by law.
All mailings under this section shall be by certified or registered mail, return
receipt requested. Nothing in this section shall affect the right of PIDA to
serve legal process in any other manner permitted by law or affect the right of
PIDA to bring any suit, action or proceeding against the Borrower or Borrower's
property in the courts of any other jurisdiction.
Section 10.17. Defined Terms. In each of the Loan Documents, unless
otherwise indicated, (i) defined terms may be used in the singular or the plural
and the use of any gender includes all genders, (ii) the words, "hereof',
"herein", "hereto", "hereby" and "hereunder" refer to the particular Loan
Document in which they occur in such document's entirety, (iii) the term, the
"Loan Documents", and the words, "thereof", "therein", "thereto", "thereby" and
"thereunder" refer to all the Loan Documents, taken together as a whole,
(iv) all references to particular Articles, Sections or Paragraphs are
references to the particular Article, Section or Paragraph of the particular
Loan Document in which such references occur.
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Section 10.18. Incorporation by Reference. All exhibits to this Agreement
and the terms of all Loan Documents shall be incorporated herein by reference as
though expressly set forth herein.
Section 10.19. Descriptive Headings. Descriptive headings of the several
Articles and Sections of each of the Loan Documents are intended for convenience
only and shall not control or affect the meaning or construction of any of the
provisions hereof.
Section 10.20. Further Assurances. The Borrower, from time to time, shall
execute such further instruments as PIDA may reasonably request to further
confirm and assure the interests and rights created or intended to be created in
favor of PIDA hereunder or under the Loan Documents.
Section 10.21. Complete Agreement. The Loan Documents constitute the entire
agreement between PIDA and the Borrower with respect to the Project and the
Loan. The Loan Documents supersede and replace all prior agreements related to
the subject matter thereof including, without limitation, the Commitment, except
to the extent such prior agreements are expressly incorporated by reference or
otherwise referred to. This Agreement, the Premises Agreement, the Assignment,
and the Assumption Agreement may be modified or amended only by a written
instrument duly executed by PIDA, the Borrower, and the Industrial Occupant.
Each of the remaining Loan Documents may be modified only by a written
instrument duly executed by PIDA and the remaining parties to the particular
Loan Document.
IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement as
of the day and year first above written.
ATTEST: /s/ Xxxxxxx X. Xxxxxx THE PENNSYLVANIA INDUSTRIAL
--------------------- DEVELOPMENT AUTHORITY
Assistant Secretary
By: /s/ Xxxxxxxxxx Xxxxxx
-----------------------------
(CORPORATE SEAL) Administrator
ATTEST: /s/ Xxxxxx X. Xxx PIDC FINANCING CORPORATION
---------------------
Assistant Secretary By: /s/ Xxxxxx X. Xxxxxx
-----------------------------
Senior Vice President
(CORPORATE SEAL)
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