CREDIT AGREEMENT
CREDIT AGREEMENT, dated as of March 1, 1996, between ONE LIBERTY
PROPERTIES, INC., a Maryland corporation having its principal office at 00
Xxxxxx Xxxx Xxxx, Xxxxx Xxxx, Xxx Xxxx 00000 (the "Borrower"), and BANK LEUMI
TRUST COMPANY OF NEW YORK, a New York banking corporation having an office at
000 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 (the "Bank").
R E C I T A L S:
The Borrower desires the Bank, and the Bank is willing, subject to and
upon the terms and conditions set forth herein, to make "Revolving Loans" (as
hereinafter defined) in the aggregate principal amount not in excess of
$5,000,000 at any time outstanding. Accordingly, the Borrower and the Bank
hereby agree as follows:
SECTION I. DEFINITIONS AND ACCOUNTING TERMS.
1.1 DEFINED TERMS. As used in this Agreement, the following terms
shall have the following meanings, unless the context otherwise requires:
"AFFILIATE" shall mean, with respect to any specified Person, any
other Person directly or indirectly controlling or controlled by or under direct
or indirect common control with such specified Person. For purposes of this
definition, "control" (including, with correlative meanings, the terms
"controlled by" and "under common control with") when used with respect to any
specified Person, shall mean the power to direct or cause the direction of the
actions, management or policies of such Person, directly or indirectly, whether
through the ownership of voting securities, by contract or otherwise and whether
or not such power is actually exercised.
"AGREEMENT" shall mean this Credit Agreement, as amended, modified or
supplemented from time to time in accordance with its terms.
"BANK" shall mean Bank Leumi Trust Company of New York.
"BORROWER" shall mean One Liberty Properties, Inc., a Maryland
corporation.
"BORROWING NOTICE"-shall have the meaning set forth in Section 2.1.2
hereof.
"BUSINESS DAY" shall mean any day on which the Bank is not closed (as
required or permitted by law or otherwise).
"CASH EQUIVALENTS" shall mean:
(i) demand deposits at, or certificates of deposit in
dollars of, any Institutional Lender;
(ii) any security issued or guaranteed as to principal and
interest by the United States, or by a person controlled or supervised
and acting as an instrumentality of the Government of the United
States pursuant to authority granted by the Congress of the United
States;
(iii) investments in money market mutual funds having assets
in excess of $2,500,000,000;
(iv) commercial paper at the time of acquisition having the
highest rating obtainable from either Standard & Poor's Corporation or
Xxxxx'x Investor Service, Inc.;
(v) federally tax exempt securities rated A or better by
either Standard & Poor's Corporation or Xxxxx'x Investor Service,
Inc.; and
(vi) investments in the stock of any Subsidiary; provided
that prior to the making of such investment the Borrower and such
Subsidiary shall have complied in all respects with the provisions of
Section 5.12 of this Agreement;
PROVIDED that, in each case mentioned in (i), (ii), (iv) and (v) above, such
obligations shall mature not more than one year from the date of acquisition
thereof.
"CASH FLOW" shall mean, with respect to any specified period, the
excess (if any) of the cash gross revenues actually received by the Borrower
from the operation of its businesses during such period over the cash operating
expenses of the Borrower actually paid with respect to its businesses during
such period.
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"COLLATERAL" shall mean that property of the Borrower or a Subsidiary
in which the Bank has been or shall hereafter be granted a lien or security
interest under the Security Agreement of the Borrower or such Subsidiary.
"COMMITMENT AMOUNT" shall mean, as to any Lender, the aggregate
outstanding principal amount of Revolving Credit Loans such Lender is obligated,
under the Lender Credit Agreement between such Lender and the Borrower, to
advance to the Borrower. The Commitment Amount of the Bank is $5,000,000.
"CONSOLIDATED" shall mean, in respect of any Person, as applied to any
financial or accounting term, such term determined on a consolidated basis in
accordance with GAAP for the Person and all consolidated Subsidiaries thereof.
"DEFAULT" shall mean any condition, act or event which, with notice or
lapse of time or both, would constitute an Event of Default.
"DEFICIENCY FEE AGREEMENT" shall have the meaning set forth in Section
3.1.5 hereof.
"ERISA" shall mean the Employee Retirement Income Security Act of
1974, as amended from time to time, and the regulations and published
interpretations thereof.
"ERISA AFFILIATE" shall mean any trade or business (whether or not
incorporated) which together with the Borrower would be treated as a single
employer under Section 4001 (b)(1) of ERISA.
"EVENT OF DEFAULT" shall have the meaning set forth in Section 7.1
hereof.
"EXISTING SUBSIDIARIES" shall have the meaning set forth in Section
4.1 hereof.
"EXPIRATION DATE" shall mean February 28, 1999; provided, however,
that if the Borrower duly exercises the Extension Option as provided in Section
2.3, then the Expiration Date shall mean February 29, 2000.
"EXTENSION OPTION" shall have the meaning set forth in Section 2.3
hereof.
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"EXTENSION FEE" shall have the meaning set forth in Section 2.2.2
hereof.
"FACILITY FEE" shall have the meaning set forth in Section 2.2.1
hereof.
"FINAL YEAR" shall mean the period which commences on March 1,
1999 and ends February 29, 2000.
"FINANCING AGREEMENTS" shall mean the following agreements and
instruments (as such agreements and instruments may be hereafter amended,
modified or supplemented in accordance with their respective terms): (i) the
Security Agreements, (ii) the Note, (iii) the Guarantees, (iv) the Deficiency
Fee Agreement, and (v) any other supplementary security agreements or other
collateral documents now or hereafter delivered to the Bank by the Borrower or
any Subsidiary.
"GAAP" means generally accepted accounting principles applied on a
consistent basis.
"GUARANTEES" shall have the meaning set forth in Section 2.8 hereof.
"INDEBTEDNESS" shall mean (i) any obligation or liability for the
payment of borrowed money or for the deferred purchase price of property or
services (including trade obligations), (ii) obligations under any lease
required to be capitalized under GAAP, (iii) obligations under letters of
credit, (iv) obligations under acceptance facilities, (v) current liabilities in
respect of unfunded vested benefits under Plans covered by.ERISA, (vi) any
liabilities secured by any mortgage, pledge, lien or security interest existing
on property owned or acquired, whether or not such liability shall have been
assumed, and (vii) all obligations, guarantees, endorsements (other than
endorsements of checks or other negotiable instruments for collection or deposit
in the ordinary course of business) and other contingent obligations in respect
of the obligations of others.
"INSTITUTIONAL LENDER" shall mean (i) the Bank and any of its
Affiliates, and (ii) any other savings bank, savings and loan association,
commercial bank or trust company, insurance company, or any holding or service
company of any of the foregoing, in each case having capital of not less than
$40,000,000 and authorized to do business in the United States.
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"INTERCREDITOR AGREEMENT" shall have the meaning
set forth in Section 3.1.8 hereof.
"LENDER" shall mean the Bank and each of the Other Lenders.
"LENDER CREDIT AGREEMENTS" shall mean this Agreement and each of the
Other Lender Credit Agreements.
"MANDATORY PREPAYMENT EVENT" shall mean any of the following events:
(i) the sale, conveyance, exchange, leasing (other than
leasing in the ordinary course) or other disposition by the Borrower
or any Subsidiary of any Property or the sale, conveyance, exchange
or other disposition by the Borrower or any Subsidiary of any
Mortgage Note and/or Mortgage;
(ii) the prepayment of any Mortgage Note or the payment of
the principal balance due thereunder upon its stated maturity or
following an acceleration thereof;
(iii) the issuance by the Borrower or any Subsidiary of any
of its securities (other than (x) the issuance of securities to
employees of the Borrower or any such Subsidiary, (y) the issuance by
any Subsidiary of its securities to the Borrower, or (z) securities
issuable to the holders of the preferred stock of the Borrower upon
any conversion thereof); and
(iv) the incurrence by the Borrower or any Subsidiary of any
Indebtedness which is secured, in whole or in part, by a Property;
provided, however, that in the case of any refinancing of any existing
Indebtedness on such Property, only to the extent the Indebtedness
exceeds the principal amount being refinanced.
"MORTGAGE" shall have the meaning set forth in the Security
Agreement of the Borrower.
"MORTGAGE NOTE" shall have the meaning set forth in the Security
Agreement of the Borrower.
"MORTGAGED PROPERTY" shall have the meaning set forth in the Security
Agreement.
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"MULTIEMPLOYER PLAN" shall mean a Plan described in Section 4001(a)(3)
of ERISA which covers employees of the Borrower or any ERISA Affiliate.
"NET PROCEEDS" shall mean, with reference to any Mandatory Prepayment
Event, the aggregate proceeds received by the Borrower or a Subsidiary (as the
case may be) in cash with respect to such Mandatory Prepayment Event less the
costs incurred by Borrower or such Subsidiary (as the case may be) to consummate
such Mandatory Prepayment Event, including attorney's fees, accounting fees,
title fees, brokerage fees and other similar expenses paid by the Borrower or
such Subsidiary (as the case may be); provided, however, that any costs paid by
the Borrower or such Subsidiary (as the case may be) to itself, any Affiliate of
the Borrower or such Subsidiary (as the case may be) or to any employee of the
Borrower or such Subsidiary shall not be deductible in determining Net Proceeds.
"NET WORTH" shall mean the excess of Consolidated total assets over
total Consolidated liabilities of the Borrower, Consolidated total assets and
total Consolidated liabilities each to be determined as to both classification
of items and amounts in accordance with GAAP; provided that there shall be
excluded from Consolidated total assets (i) all assets which would be classified
as intangible assets under GAAP, including, but not limited to, goodwill,
organization expense and deferred charges (ii) cash set apart and held in a
sinking or other analogous fund established for the purposes of redemption or
other retirement of capital stock, (iii) any revaluation or other write-up in
book value of assets subsequent to December 31, 1994, and (iv) amounts due to
the Borrower or any Subsidiary from any of the officers, directors or employees
of the Borrower or such Subsidiary.
"NOTE" shall have the meaning set forth in Section 2.1.2 hereof.
"OBLIGATIONS" means all obligations, liabilities and indebtedness of
the Borrower or any Subsidiary to the Bank, whether now existing or hereafter
created, direct or indirect, due or not, whether created directly or acquired by
assignment or otherwise, including, without limitation, all obligations,
liabilities and indebtedness of the Borrower or any Subsidiary with respect to
the Revolving Loans, and the payment and performance of all other obligations,
liabilities, and indebtedness of the Borrower or any Subsidiary to the Bank
hereunder, under any one or more of
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the Financing Agreements, including, without limitation, all fees, costs,
expenses and indemnity obligations hereunder or thereunder.
"OTHER LENDER" shall mean each Institutional Lender (other than the
Bank) which enters into an Other Lender Credit Agreement with the Borrower.
"OTHER LENDER CREDIT AGREEMENT" shall mean the credit agreement or
other financing documents between the Borrower and each Other Lender which (i)
provides for the extension of Other Revolving Loans by such Other Lender to the
Borrower, and (ii) satisfies the conditions set forth in Section 2.5 hereof.
"OTHER REVOLVING LOANS" shall mean cash advances made by an Other
Lender under the Other Lender Credit Agreement of such Other Lender.
"PBGC" shall mean the Pension Benefit Guaranty Corporation, or any
successor thereto.
"PERSON" shall mean an individual, partnership, joint venture, firm,
corporation, trust, or other business or legal entity.
"PLAN" shall mean any employee benefit plan as defined in Section 3(2)
of ERISA.
"PRO RATA SHARE" shall mean, with respect to any Lender, as at any
date at which the same is to be determined, the percentage obtained by dividing
(i) such Lender's Commitment Amount at such time by (ii) the Total Commitment
Amount.
"PROHIBITED TRANSACTION" shall mean any transaction set forth in
Section 406 of ERISA or Section 4975 of the Internal Revenue Code of 1986, as
amended from time to time.
"PROPERTY" shall mean any real property in which the Borrower or any
Subsidiary has acquired fee title, including, without limitation, investments in
residential, commercial and mixed-use real property.
"REFERENCE RATE,, shall mean the rate of interest designated by the
Bank, and in effect from time to time, as its "Reference Rate", adjusted when
said Reference Rate changes.
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"REPORTABLE EVENT",shall mean any of the events set forth in Section
4043 of ERISA.
"REVOLVING CREDIT LOANS" shall mean the Revolving Loans and the Other
Revolving Loans.
"REVOLVING LOANS" shall have the meaning set forth in Section 2.1.1
hereof.
"SECURITY AGREEMENTS" shall have the meaning set forth in Section 2.7
hereof.
"SUBSIDIARY" means, as to the Borrower, a corporation of which shares
of stock having ordinary voting power (other than stock having such power only
by reason of the happening of a contingency) to elect a majority of the board of
directors or other managers of such corporation are at the time owned, or the
management of which is otherwise controlled, directly or indirectly, through one
or more intermediaries, or both, by the Borrower.
"TOTAL COMMITMENT AMOUNT" shall mean, as at any date at which the same
is to be determined, the sum of the Commitment Amounts at such time of all of
the Lenders, the aggregate of which shall not exceed $15,000,000.
1.2 ACCOUNTING TERMS. All accounting terms not specifically defined
herein shall be construed in accordance with GAAP consistent with those applied
in the preparation of the financial statements referred to in Section 4.10, and
all financial data submitted pursuant to this Agreement shall be prepared in
accordance with such principles.
SECTION II. FINANCING.
2.1 REVOLVING CREDIT FACILITY.
2.1.1 REVOLVING LOANS. Subject to and upon the terms and
conditions of this Agreement, the Bank agrees to make cash advances (each a
"Revolving Loan" and collectively the "Revolving Loans") to the Borrower at any
time and from time to time from the date hereof to, but not including, the
Expiration Date; provided, however, that the aggregate principal sum of (i) the
Revolving Loans outstanding at any time shall in no event exceed $5,000,000, and
(ii) the Revolving Credit Loans outstanding at any time shall in no event exceed
$15,000,000. The Borrower may borrow, repay and reborrow Revolving Loans as
provided in this Agreement; provided, however, that the Borrower shall
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not be entitled to borrow Revolving Loans on more than two (2) occasions each
month. Each Revolving Loan shall be in the minimum principal sum of $200,000 or
in integral multiples of $10,000 in excess thereof.
2.1.2 BORROWING NOTICE. The Borrower shall give the Bank
notice of each proposed borrowing of Revolving Loans, not later than 11:00 a.m.,
New York City time, at least one (1) Business Day before such proposed Revolving
Loan borrowing. The notice of borrowing shall specify (i) the date of such
borrowing (which shall be a Business Day), (ii) the amount thereof (which shall
be in accordance with the provisions of this Agreement), (iii) the bank account
to be credited with the proceeds of such Revolving Loan, and (iv) shall
otherwise be in the form of Exhibit B hereto (the "Borrowing Notice"). Each
Notice of Borrowing shall be effective upon receipt and shall irrevocably commit
the Borrower to borrow in accordance with the terms of this Agreement.
2.1.3. REVOLVING CREDIT NOTE. Concurrently with the
execution and delivery of this Agreement, the Borrower shall evidence its
obligation to pay the principal of and interest on the Revolving Loans by
executing and delivering to the Bank a promissory note in the principal sum of
$5,000,000 in the form annexed hereto as Exhibit A (the "Note"). Except as
otherwise provided in this Agreement, the outstanding principal balance of each
Revolving Loan shall mature and be due and payable on the Expiration Date.
2.1.4. RATES OF INTEREST. (i) Except as provided in Section
2.1.4(ii), the outstanding principal balance of each Revolving Loan shall bear
interest until maturity (whether by acceleration or otherwise) at a rate per
annum of one-half of one percent (0.50'5) in excess of the Reference Rate, which
rate per annum shall change as and when the Reference Rate shall change.
Interest on Revolving Loans shall be calculated on the basis of the actual days
elapsed on a year of 360 days.
(ii) Upon the occurrence and during the continuance of
an Event of Default, the Borrower shall pay on demand interest, to the extent
permitted by applicable law, on the outstanding principal balance of the
Revolving Loans, at a rate per annum equal to three (3%) percent per annum above
the rate set forth in Section 2.1.4(i).
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2.1.5 INTEREST PAYMENTS. Interest in respect of the
aggregate principal amount of all Revolving Loans outstanding from time to time
during each calendar month shall be payable monthly in arrears on the first
Business Day of the following calendar month, at maturity and at the time of any
prepayment of principal to the extent accrued on the principal amount prepaid.
2.2 FEES.
2.2.1 FACILITY FEE. Concurrently with the execution and
delivery of this Agreement, the Borrower shall pay to the Bank a facility fee
(the "Facility Fee") of $50,000, of which $25,000 has already been received by
the Bank.
2.2.2 EXTENSION 0PTION FEE. In the event the Borrower
exercises the Extension Option, then the Borrower shall pay to the Bank a fee
(the "Extension Option Fee") of $12,500, payable in full at the time the
Borrower provides notice of its intention to exercise the Extension option in
accordance with Section 2.3 hereof.
2.3 EXTENSION OPTION. The Borrower may, at its option, extend the
date of maturity of the Revolving Loans from February 28, 1999 to February 29,
2000 by giving notice of exercise of such option (the "Extension Option") to the
Bank not later than November 1, 1998 but not before March 1, 1998; provided that
(i) at the time of exercise of the Extension Option, no Default or Event of
Default shall then exist, and (ii) the Borrower shall pay to the Bank the
Extension Fee concurrently with giving such notice. Upon the satisfaction of
the foregoing conditions, the maturity date of the Revolving Loans shall be so
extended, provided that prior to February 28, 1999 the Borrower shall have
executed and delivered to the Bank an amendment to the Note, in form and
substance satisfactory to the Bank, which appropriately extends the maturity
date of the Note to February 29, 2000.
2.4 PREPAYMENT OF REVOLVING LOANS.
2.4.1 OPTIONAL. The Borrower shall have the right to prepay
the outstanding principal sum of the Revolving Loans in whole at any time or in
part from time to time (but if in part, in the minimum principal amount of
$100,000) in each case upon not less than one (1) Business Day prior notice to
the Bank, without penalty or premium.
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2.4.2 MANDATORY. (i) In the event that the aggregate
principal sum of the Revolving Loans shall ever exceed $5,000,000, the Borrower
shall make a prepayment of the Revolving Loans, on demand, in an amount equal to
such excess.
(ii) Immediately upon the occurrence of a Mandatory Prepayment
Event there shall become due and payable on the Revolving Loans an amount equal
to the product of (1) the Net Proceeds of the Mandatory Prepayment Event,
multiplied by (2) the Bank's Pro Rata Share of such Net Proceeds; provided that
if at the time of such prepayment the provisions of Section 2.6(i) are then
applicable to such prepayment, the amount of the prepayment due the Bank shall
be computed and paid in accordance with the provisions of said Section 2.6(i).
2.4.3 NOTICE OF PREPAYMENT. Prior to making any prepayment
of the Revolving Loans or the Other Revolving Loans the Borrower shall notify
the Bank of such prepayment and the amount thereof. The Borrower shall also
supply the Bank with such evidence as the Bank may reasonably request evidencing
the Borrower's compliance with the provisions of Section 2.6 with respect to
such prepayment.
2.5 OTHER LENDER CREDIT AGREEMENTS. Prior to entering into any Other
Lender Credit Agreement, the Borrower shall provide the Bank with a correct and
complete copy of such Other Lender Credit Agreement and all documents and
instruments executed and delivered by the Borrower in connection therewith.
Each such Other Lender Credit Agreement shall provide that, among other things,
(i) the aggregate principal amount at
any time outstanding under the
Lender Credit Agreements shall not
exceed $15,000,000;
(ii) except as provided in Section 2.6,
all borrowings made by the Borrower
at any time under the Lender
Credit Agreements shall be made in
proportion to the Pro Rata Share of
each Lender of the Total
Commitment Amount;
(iii) except as provided in Section 2.6,
all payments and prepay-
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ments of principal of the Revolving
Credit Loans made by the Borrower
at any time under any Lender Credit
Agreement shall be made in
proportion to the Pro Rata Share of
each Lender of the Total Commitment
Amount; and
(iv) the Borrower shall be required to
provide notice of proposed
borrowings and prepayments to each
Lender substantially as set forth
in this Agreement.
2.6 ADMINISTRATION OF LENDER CREDIT AGREEMENTS. The Borrower agrees
to administer the Lender Credit Agreements so that all borrowings of Revolving
Credit Loans and all payments of principal in respect of Revolving Credit Loans
shall be made among the Lenders in proportion to their Pro Rata Share of the
Total Commitment Amount; provided, however, that (i) if immediately prior to
giving effect to any payment of principal amounts due a Lender in respect of
Revolving Credit Loans, the aggregate principal amount of the Revolving Credit
Loans shall not be in proportion to the Pro Rata Share of the Lenders in the
Total Commitment Amount, then such payment shall be made to the Lenders in such
manner as shall result, as nearly as practicable after giving effect to such
payment, to the principal amount of outstanding Revolving Credit Loans held by
each such Lender after such payment being in proportion to their Pro Rata Share
of the Total Commitment Amount, and (ii) if the Borrower shall enter into an
Other Lender Credit Agreement following the date hereof (the date of the initial
borrowing under such Other Lender Credit Agreement, the "New Loan Date"), the
Borrower shall borrow from such Other Lender and prepay the outstanding
principal sum of the Revolving Credit Loans of the Bank and each Other Lender a
party to a Revolving Credit Agreement prior to the New Loan Date, such amounts
as shall be necessary so that after giving effect to such borrowing and
prepayment the outstanding principal sum of the Revolving Credit Loans held by
each Lender are in proportion to their Pro Rata Share of the Total Commitment
Amount.
2.7 SECURITY AGREEMENTS. Concurrently with the execution and
delivery of this Agreement, the Borrower and each Existing Subsidiary shall
grant a valid and perfected security interest to the Bank in their respective
Collateral
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pursuant to a separate security agreement from each of them to the Bank, each
such agreement dated as of even date herewith, in the form annexed hereto as
Exhibit C (such security agreements, inclusive of any security agreement
executed by a Subsidiary pursuant to Section 5.12, collectively, the "Security
Agreements").
2.8 GUARANTEES. Concurrently with the execution and delivery of this
Agreement, each Existing Subsidiary shall unconditionally guarantee all of the
Obligations of the Borrower to the Bank pursuant to a guarantee from each of
them to the Bank, each such guarantee dated as of even date herewith, in the
form annexed hereto as Exhibit D (such guarantees, inclusive of any guarantee
delivered pursuant to Section 5.12, collectively, the "Guarantees").
2.9 RIGHT TO DEBIT ACCOUNT. The Borrower authorizes (but shall not
require) the Bank to debit any account maintained by the Borrower with the Bank,
on any date on which a payment or fee is due hereunder or under any of the
Financing Agreements, in an amount equal to any unpaid portion of such payment
or fee.
SECTION III. CONDITIONS PRECEDENT.
3.1 CONDITIONS TO THE MAKING OF REVOLVING LOANS. The obligation of
the Bank to make the initial Revolving Loan to the Borrower is subject to the
conditions precedent that:
3.1.1 FINANCING AGREEMENTS. The Borrower and each Existing
Subsidiary shall have executed and delivered to the Bank the Financing
Agreements to be executed by it, and all other agreements, instruments and
documents required or contemplated by this Agreement and the Financing
Agreements.
3.1.2 OPINION OF THE BORROWER'S COUNSEL. The Bank shall
have received a written opinion of the Borrower's in-house counsel, dated as of
even date herewith, in form and substance satisfactory to the Bank and its
counsel.
3.1.3 EVIDENCE OF CORPORATE ACTION; CERTIFICATE OF
INCORPORATION AND BY-LAWS. The Bank shall have received (i) copies of all
corporate action taken by the Borrower and each Existing Subsidiary to authorize
the execution, delivery and performance of this Agreement and the Financing
Agreements to be executed by it; (ii) a copy
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of the Borrower's and each Existing Subsidiary's Certificate of Incorporation,
as amended to date; and (iii) a copy of the By-Laws of the Borrower and each
Existing Subsidiary, as amended to date. All of the documents listed in
subsections (i), (ii) and (iii) shall be certified by the Borrower's and each
Existing Subsidiary's Secretary in a Certificate dated as of even date herewith.
3.1.4 INSURANCE. The Bank shall have received correct and
complete copies of all insurance policies of the Borrower and each Existing
Subsidiary with endorsements wherein the Bank shall be named as a loss payee, in
compliance with Section 5.2.2 hereof.
3.1.5 DEFICIENCY FEE AGREEMENT. The Borrower shall have
executed and delivered to the Bank the Bank's standard form of Deficiency Fee
Agreement (the "Deficiency Fee Agreement") which provides for a Balance
Level (as defined therein) of $250,000.
3.1.6 GRANT OF SECURITY INTEREST. The Borrower and each
Existing Subsidiary shall have granted to the Bank, pursuant to the Security
Agreements, a first priority security interest in their respective Collateral.
3.1.7 DELIVERY OF DOCUMENTS AT THE CLOSING. The Borrower
shall have delivered to the Bank the following documents: (i) originals of the
Mortgage Notes and Mortgages together with an allonge to each Mortgage Note
endorsing the same to the Bank and an assignment of each Mortgage by the
Borrower to the Bank (with all documents and fees required to record said
assignment); (ii) a policy of title insurance or endorsement to the Borrower's
title insurance policy, with respect to each Mortgage, containing only such
exceptions to title as are acceptable to the Bank, naming the Bank as mortgagee,
as its interest may appear (along with the payment of the fee to be charged by
the title company, if any, for providing such insurance coverage); (iii) a
survey of the property encumbered by the Mortgage (the "Mortgaged Property);
(iv) a fire and hazard insurance policy for the Mortgaged Property naming the
Bank as mortgagee, as its interest may appear; (v) a flood insurance policy for
the Mortgaged Property if the same is in a special flood hazard area, naming the
Bank as mortgagee, as its interest may appear, or a certificate or other
evidence satisfactory to the Bank that the Mortgaged Property is not in a
special flood hazard area; (vi) certificates of occupancy for the structures
located on the Mortgaged Property; (vii) an estoppel certificate from the fee
owner of the
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Mortgaged Property in the form required by the Bank; and (viii) a letter of
direction to the mortgagor under each Mortgage directing them to pay to the
Bank, upon receipt of a notice from the Bank that a Default or an Event of
Default has occurred, all payments of principal and interest due under the
Mortgage and the Mortgage Note.
3.1.8 INTERCREDITOR AGREEMENT. Each Other Lender (if any)
shall have entered into an intercreditor agreement (the "Intercreditor
Agreement") with the Bank in form and substance satisfactory to the Bank.
3.1.9 ESTOPPEL CERTIFICATE. With respect to each Mortgage
and Mortgage Note, the Bank shall have received from the mortgagor thereunder an
estoppel certificate (a) confirming that (i) such Mortgage and Mortgage Note
have not been modified except as disclosed therein; and (ii) the principal
balance due thereunder and the interest rate and interest and principal payments
required thereunder are substantially the same as the figures shown on Schedule
3.1.9 annexed hereto and made a part hereof, and (b) certifying that the
mortgagor has no defenses, offsets or credits against its payment obligations
under the Mortgage and Mortgage Note and no claims against the Borrower or any
Subsidiary thereunder.
3.1.10 PLEDGE OF STOCK OF EXISTING SUBSIDIARIES. Pursuant to
the Security Agreement from the Borrower to the Bank, the Borrower shall have
delivered to the Bank stock certificates accompanied by duly executed stock
powers in blank for all of the issued and outstanding shares of capital stock of
each Existing Subsidiary.
3.2 ADDITIONAL PRECONDITIONS. As of the date of the making of any
Revolving Loan to the Borrower, as a condition to the making of any Revolving
Loan:
3.2.1 REPRESENTATIONS AND WARRANTIES. All representations
and warranties contained herein or otherwise made to the Bank pursuant to this
Agreement or any of the Financing Agreements shall be true, complete and
correct.
3.2.2 DEFAULT OR EVENT OF DEFAULT. There shall exist no
Default or Event of Default.
3.2.3 OTHER DOCUMENTS. The Bank and its counsel shall have
received all information and copies of all documents, including records of
Borrower's and each Subsidiary's corporate proceedings, which the Bank or its
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counsel may have reasonably requested in connection therewith, such documents
where requested by the Bank or its counsel to be certified by appropriate
corporate or governmental authorities.
3.2.4 NO ADVERSE CHANGE. There shall have been no material
adverse change in the operations, business, property or assets or in the
condition (financial or otherwise) of the Borrower or any Subsidiary.
3.2.5 NOTICE REQUIREMENTS; PRO RATA TREATMENT FOR BORROWINGS.
The Bank shall have received a copy of each borrowing notice sent by the
Borrower to each other Lender in connection with such proposed borrowing as
contemplated by Section 2.6.
3.2.6 INTERCREDITOR AGREEMENT. Each Other Lender (if any)
shall have entered into the Intercreditor Agreement.
3.2.7 REVIEW OF TERMS AND CONDITIONS OF PROPOSED
ACQUISITIONS. The Bank shall have reviewed all of the material terms relating
to the acquisition of the Property to be acquired with the proceeds of such
Revolving Loan, including the latest drafts of any acquisition documents
prepared therefor. The Bank shall have received projections with respect to the
Property to be acquired with the proceeds of such Revolving Loan which reflect,
in the first twelve (12) months following the acquisition, Cash Flow equal to
not less than 9 1/2% of the purchase price of the Property being acquired (net
of secured debt on the Property at the time of its purchase). Such projections
shall be prepared in accordance with GAAP. Cash Flow for this purpose shall
mean the excess of the cash gross revenues to be received by the Borrower during
the twelve month period from the Property to be acquired less the cash operating
expenses of the Borrower to be paid during such twelve month period relating to
such Property.
3.2.8 MORTGAGOR NOT IN DEFAULT. With respect to each
Mortgage and Mortgage Note, the mortgagor thereunder shall not be in default
under any of the material terms, conditions or covenants of such Mortgage or
Mortgage Note.
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SECTION IV. REPRESENTATIONS AND WARRANTIES.
In order to induce the Bank to enter into this Agreement and to make
the Revolving Loan hereunder, the Borrower represents and warrants to the Bank
as follows:
4.1 ORGANIZATION. The Borrower and each Subsidiary is a duly
organized and validly existing corporation in good standing under the laws of
its jurisdiction of incorporation with perpetual corporate existence and has all
requisite right, power and authority and all necessary licenses and permits to
own and operate its assets and properties and to carry on its business as now
conducted and as presently proposed to be conducted. The Borrower and each
Subsidiary has qualified and is in good standing as a foreign corporation in
each state or other jurisdiction where the nature of its business or the
ownership or use of its property requires such qualification, except such
jurisdictions, if any, in which the failure to be so qualified will not have a
material and adverse effect on either the conduct of its business or the
ownership of its properties. As of the date hereof, the Borrower has the
Subsidiaries listed on Schedule 4.1 hereof (each an "Existing Subsidiary").
4.2 AUTHORIZATION. The Borrower and each Subsidiary has all
requisite legal right, power and authority to execute, deliver and perform the
terms and provisions of this Agreement, the Financing Agreements executed by it
and all other instruments and documents delivered by it pursuant hereto and
thereto. The Borrower and each Subsidiary has taken or caused to be taken all
necessary action to authorize the execution, delivery and performance of this
Agreement, the Financing Agreements executed by it and any other related
agreements, instruments or documents delivered or to be delivered by the
Borrower or such Subsidiary pursuant hereto and thereto. This Agreement, the
Financing Agreements executed by the Borrower and each Subsidiary and all
related agreements, instruments or documents delivered or to be delivered
pursuant hereto or thereto constitute and will constitute legal, valid and
binding obligations of the Borrower or such Subsidiary (as the case may be),
enforceable in accordance with their respective terms, subject to bankruptcy,
insolvency, reorganization, moratorium and other similar laws affecting the
enforcement of creditors' rights generally.
4.3 NO CONFLICTS. Neither the execution and delivery of this
Agreement, the Financing Agreements, or any of the instruments and documents
delivered or to be deliv-
-17-
ered pursuant hereto or thereto, by the Borrower or any Subsidiary, nor the
consummation of the transactions herein or therein contemplated, nor compliance
with the provisions hereof or thereof, will violate any law, statute or
regulation, or any order, writ or decree of any court or governmental
instrumentality, or will conflict with, or result in the breach of, or
constitute a default in any respect under, any indenture, mortgage, deed of
trust, agreement or other instrument to which the Borrower or any Subsidiary is
a party, or by which any of its respective properties may be bound or affected,
or will result in the creation or imposition of any lien, charge or encumbrance
upon any of their respective properties (except as contemplated hereunder or
under the Financing Agreements) or will violate any provision of the Certificate
of Incorporation or By-Laws of the Borrower or any Subsidiary, as amended to
date.
4.4 COMPLIANCE AND OTHER AGREEMENTS.
4.4.1 Neither the Borrower nor any Subsidiary is in default
under any indenture, mortgage, deed of trust, agreement or other instrument to
which it is a party, or by which it or any of its properties may be bound or
affected, except for such defaults which, individually or in the aggregate, will
not have a material and adverse effect on the business, operations, property or
assets or on the condition, financial or otherwise, of the Borrower or any
Subsidiary.
4.4.2 Neither the Borrower nor any Subsidiary is in default
with respect to any order, writ, injunction or decree of any court or of any
federal, state, municipal or other governmental department, commission, board,
bureau, agency or authority, domestic or foreign, or in violation of any law,
statute or regulation, domestic or foreign, to which it is, or any of its
properties are, subject, except for such defaults or violations which, in the
aggregate, will not have a material and adverse effect on the business,
operations, property or assets or on the condition, financial or otherwise, of
the Borrower or any Subsidiary.
4.4.3 Neither the Borrower nor any Subsidiary is a party to
or bound by, nor are any of their respective properties bound or affected by,
any agreement, deed, lease or other instrument, or subject to any charter or
other corporate restriction or any judgment, order, writ, injunction, decree or
award, or any law, statute, rule or regulation, any of which materially and
adversely affects or
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in the future may (so far as the Borrower may now foresee) materially and
adversely affect the business, operations, prospects, properties or assets, or
the condition, financial or otherwise, of the Borrower or any Subsidiary.
4.5 ERISA. The Borrower is in compliance in all material respects
with all applicable provisions of ERISA. Neither a Reportable Event nor a
Prohibited Transaction has occurred and is continuing with respect to any Plan;
no notice of intent to terminate a Plan has been filed nor has any Plan been
terminated; no circumstances exist which constitute grounds under Section 4042
of ERISA entitling the PBGC to institute proceedings to terminate, or appoint a
trustee to administrate, a Plan, nor has the PBGC instituted any such
proceedings; neither the Borrower nor any ERISA Affiliate has completely or
partially withdrawn under Sections 4201 or 4204 of ERISA from a Multiemployer
Plan; the Borrower and each ERISA Affiliate have met their minimum funding
requirements under ERISA with respect to all of their Plans and the present fair
market value of all Plan assets exceeds the present value of all vested benefits
under each Plan, as determined on the most recent valuation date of the Plan and
in accordance with the provisions of ERISA and the regulations thereunder for
calculating the potential liability of the Borrower or any ERISA Affiliate to
PBGC or the Plan under Title IV of ERISA; and neither the Borrower nor any ERISA
Affiliate has incurred any liability to the PBGC under ERISA.
4.6 INVESTMENT COMPANY. Neither the Borrower nor any Subsidiary is
an "investment company" or a company "controlled" by an "investment company"
within the meaning of the Investment Company Act of 1940, as amended.
4.7 APPROVALS AND CONSENTS. All authorizations, consents,
registrations, exemptions, approvals and licenses (governmental or otherwise) or
the taking of any other action (including, without limitation, by the
shareholders of the Borrower and each Subsidiary) which are required as a
condition to the validity or enforceability of this Agreement, the Financing
Agreements or any of the instruments or documents delivered or to be delivered
pursuant hereto or thereto, have been effected or obtained and are in full force
and effect.
4.8 REGULATION U; SECURITIES EXCHANGE ACT OF 1934. Neither the
Borrower nor any Subsidiary is engaged principally, or as one of its more
important activities, in the business of extending credit for the purpose of
purchas-
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ing or carrying any margin stock (within the meaning of Regulation U or G of the
Board of Governors (the "Board") of the Federal Reserve System). None of the
proceeds of the Revolving Loans will be used, directly or indirectly, for the
purpose of purchasing or carrying any margin stock or for any other purpose
which might constitute this transaction a "purpose credit" within the meaning of
such Regulation U. Neither the Borrower nor any Subsidiary will take, nor will
it permit any agent acting on its behalf to take, any action which might cause
this Agreement or any of the Financing Agreements to violate any regulation of
the Board or to violate the Securities Exchange Act of 1934, in each case as in
effect on the date hereof or as amended hereafter.
4.9 USE OF FUNDS. The proceeds of the Revolving Loans shall be used
to finance the acquisition by the Borrower of fee title to Properties.
4.10 FINANCIAL STATEMENTS. The Borrower has heretofore delivered to
the Bank the financial statements of the Borrower on a Consolidated basis for
its fiscal year ended December 31, 1994, and for the six-month period ending
June 30, 1995 (consisting of balance sheets and related statements of income,
retained earnings, stockholders, equity and changes in cash flows for the fiscal
year or period then ended, including the related schedules annexed thereto)
which year-end financial statements were audited by Xxxxxxx Leventhol & Co.
(presently known as Ernst & Young LLP) independent certified public accountants.
Such financial statements are correct and complete and were prepared in
accordance with GAAP and present fairly the financial position and results of
operations of the Borrower and each Subsidiary as of the dates of and for the
periods involved. There are no material liabilities, direct or indirect, fixed
or contingent, of the Borrower or any Subsidiary as of the date of such
financial statements which were not reflected therein or in the notes thereto in
accordance with GAAP. There has been no material adverse change since June 30,
1995 in the business, operations, prospects, property or assets of the Borrower
or any Subsidiary.
4.11 TAXES. The Borrower and each Subsidiary has filed or caused to
be filed all tax returns required to be filed by it. Except as permitted by
Section 5.3 hereof, the Borrower and each Subsidiary has paid all taxes
(including interest and penalties) as shown on such returns or any assessment or
notice of tax claim or deficiency received by it to the extent that such taxes
have become due. Neither
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the Borrower nor any Subsidiary has any knowledge of any proposed tax assessment
against or affecting it and is otherwise obligated by any agreement, instrument
or otherwise to contribute to the payment of taxes owed by any other Person.
All material tax liabilities are adequately provided for or reserved against on
the books of the Borrower and each Subsidiary in accordance with GAAP.
4.12 TITLE TO PROPERTIES/PRIORITY OF LIENS.
4.12.1 The Borrower and each Subsidiary has good and
marketable title to, or valid leasehold interests in, all of the properties and
assets reflected on the most recent of the financial statements delivered to the
Bank pursuant to Section 4.10 or acquired by it after the date of such financial
statement and prior to the date hereof, except for those properties and assets
which have been disposed of since such date in the ordinary course of business.
All such properties and assets are owned or leased by the Borrower or a
Subsidiary free and clear of all mortgages, pledges, liens, security interests
or charges of any kind, except (i) such as are disclosed on Schedule 4.12
hereto, (ii) such as are in favor of the Bank, and (iii) such as are permitted
under the provisions of Section 6.2 hereof.
4.12.2 The liens and security interests granted to the
Bank by the Borrower and each Subsidiary under the Security Agreements
constitute valid and perfected liens and security interests in the Collateral
covered thereby.
4.13 LITIGATION. Except as set forth on Schedule 4.13,
there are no actions, suits, investigations or administrative proceedings of or
before any court, arbitrator or governmental authority, pending or, to
Borrower's knowledge threatened, against the Borrower or any Subsidiary or any
of their respective properties or assets which (i) either in any case or in the
aggregate, if adversely determined, would materially and adversely affect the
business, operations, prospects, properties or assets or the condition,
financial or otherwise, of the Borrower or any Subsidiary, or (ii) question the
validity or enforceability of this Agreement, the Financing Agreements, or any
action to be taken in connection with the transactions contemplated hereby or
thereby.
-21-
4.14 INSURANCE. All physical properties and assets of the
Borrower and any Subsidiary are insured in accordance with the requirements of
Section 5.2.2 hereof.
4.15 ENVIRONMENT. Except as disclosed on Schedule 4.15
hereof, the Borrower and each Subsidiary has duly complied with, and its
business, operations, assets, equipment, property, leaseholds, or other
facilities are in compliance with, the provisions of all federal, state and
local environmental, health, and safety laws, codes and ordinances, and all
rules and regulations promulgated thereunder. The Borrower and each Subsidiary
has been issued and will maintain all required federal, state, and local
permits, licenses, certificates, and approvals relating to (i) air emissions;
(ii) discharges to surface water or groundwater; (iii) noise emissions; (iv)
solid or liquid waste disposal; (v) the use, generation, storage,
transportation, or disposal of toxic or hazardous substances or wastes (intended
hereby and hereafter to include any and all such materials listed in any
federal, state, or local law, code or ordinance, and all rules and regulations
promulgated thereunder as hazardous or potentially hazardous); or (vi) other
environmental, health, or safety matters. Except as disclosed on Schedule 4.15
hereof, neither the Borrower nor any Subsidiary has received notice of, nor
knows of, or suspects, facts which might constitute any violations of any
federal, state, or local environmental, health, or safety laws, codes or
ordinances, and any rules or regulations promulgated thereunder with respect to
its business, operations, assets, equipment, property, leaseholds, or other
facilities. Except in accordance with a valid governmental permit, license,
certificate, or approval issued to the Borrower and each Subsidiary and except
as disclosed on Schedule 4.15 hereof, there has been no emission, spill,
release, or discharge into or upon (i) the air; (ii) soils, or any improvements
located thereon; (iii) surface water or groundwater; or (iv) the sewer, septic
system or waste treatment, storage or disposal system servicing any of the
premises of the Borrower and each Subsidiary, of any toxic or hazardous
substances or wastes at or from the premises of the Borrower and each
Subsidiary; and accordingly all of the premises of the Borrower and each
Subsidiary are free of all such toxic or hazardous substances or wastes. Except
as disclosed on Schedule 4.15 hereof, there has been no complaint, order,
directive, claim, citation, or notice by any governmental authority or any
person or entity with respect to (i) air emissions; (ii) spills, releases, or
discharges to soils or improvements located thereon, surface water, groundwater
or the sewer,
-22-
septic system or waste treatment, storage or disposal systems servicing the
premises; (iii) noise emissions; (iv) solid or liquid waste disposal; (v) the
use, generation, storage, transportation, or disposal of toxic or hazardous
substances or waste; or (vi) other environmental, health, or safety matters
affecting the Borrower and each Subsidiary, or its business, operations, assets,
equipment, property, leaseholds, or other facilities. Except as disclosed on
Schedule 4.15 hereof, neither the Borrower nor any Subsidiary has any
indebtedness, obligation, or liability, absolute or contingent, matured or not
matured, with respect to the storage, treatment, cleanup, or disposal of any
solid wastes, hazardous wastes, or other toxic or hazardous substances
(including without limitation any such indebtedness, obligation, or liability
with respect to any current regulation, law, or statute regarding such storage,
treatment, cleanup, or disposal).
4.16 DISCLOSURE. No certificate, statement, report or other document
furnished to the Bank by or on behalf of the Borrower or any Subsidiary in
connection herewith or in connection with any transaction contemplated hereby,
or this Agreement, or any Financing Agreement, contains any untrue statement of
a material fact or omits to state any material fact necessary in order to make
the statements contained therein not misleading.
4.17 MORTGAGES. There does not exist at the date hereof any
default under any Mortgage or any condition, event or act which, with the
passage of time or giving of notice, or both, would constitute such a default.
4.18 NO EVENT OF DEFAULT. After giving effect to the
transactions contemplated by this Agreement, the Financing Agreements and the
other instruments or documents delivered in connection herewith and therewith,
there does not exist at the date hereof any condition, event or act which
constitutes an Event of Default hereunder or a Default.
SECTION V. AFFIRMATIVE COVENANTS.
The Borrower covenants and agrees that, until all of the
Obligations are paid and satisfied in full, it shall comply, or cause compliance
with, and shall cause each Subsidiary to comply with the following covenants:
5.1 PRESERVATION OF EXISTENCE. The Borrower and each Subsidiary
will preserve and maintain its corporate
-23-
existence, rights, franchises and privileges in the jurisdiction of its
incorporation and will qualify and remain qualified as a foreign corporation in
each jurisdiction in which such qualification is necessary or desirable in view
of its business and operations or in view of the ownership of its properties.
5.2 MAINTENANCE OF PROPERTIES; INSURANCE.
5.2.1 The Borrower and each Subsidiary will maintain in
good repair, working order and condition each Property and all other properties
used or useful in its business (ordinary wear and tear excepted) and from time
to time will make or cause to be made all appropriate repairs, renewals and
replacements, additions and improvements thereto, except where such failure
would not have a material adverse effect on the business, operations, property
or assets or on the condition, financial or otherwise, of the Borrower or any
Subsidiary.
5.2.2 The Borrower and each Subsidiary will maintain at
its expense, with financially sound and reputable insurers reasonably acceptable
to the Bank, insurance, with respect to each Property and all of its other
properties and business, against loss or damage of the kinds and in the amounts
customarily insured against by businesses of established reputation engaged in
the same or a similar business and similarly situated. All such insurance of
the Borrower and each Subsidiary shall name the Bank as loss payee and shall
contain such other provisions as the Bank may reasonably require to fully
protect its interest in the Collateral.
5.3 PAYMENT OF TAXES. The Borrower and each Subsidiary will pay
and discharge promptly all taxes (including, without limitation, all payroll
withholdings), assessments and governmental charges or levies imposed upon it or
upon its income or profits or upon each Property or any of its other property,
real, personal or mixed, or upon any part thereof, before the same shall become
in default; provided, however, that neither the Borrower nor any Subsidiary
shall be required to pay any such tax, assessment, charge, levy or claim if the
validity or amount thereof shall be contested in good faith by proper
proceedings and if the Borrower or such Subsidiary shall have set aside on its
books appropriate reserves.
-24-
5.4 INSPECTION. Without in any way limiting the Bank's right
to inspection under the Financing Agreements, the Borrower will permit the Bank
to have one or more of its officers and employees, or any other Person
designated by the Bank, at the Bank's expense, visit and inspect any of the
properties of the Borrower and any Subsidiary, as applicable (subject to the
rights of tenants of any such property under their respective leases), and to
examine the minute books, books of account and other records of the Borrower and
to make copies thereof or extracts therefrom, and discuss its affairs, finances
and accounts with its officers and, at the request of the Bank, with the
Borrower's independent accountants, in each case upon the giving of reasonable
advance notice and during normal business hours and at such other reasonable
times and as often as the Bank may reasonably desire.
5.5 ACCOUNTING; FINANCIAL STATEMENTS AND OTHER INFORMATION.
The Borrower and each Subsidiary will maintain a system of
accounting established and administered in accordance with GAAP and will set
aside on its books all such proper reserves for each fiscal year for
depreciation, obsolescence, amortization, bad debts and other purposes as shall
be required by GAAP. The Borrower will deliver, or cause to be delivered, to
the Bank:
5.5.1 As soon as practicable following the end of each
calendar quarter, but in any event not later than 60 days thereafter, an
unaudited balance sheet of the Borrower as at the end of such quarter and the
related statements of income, retained earnings, stockholders equity and changes
in cash flows of the Borrower for such quarter, all in reasonable detail and
satisfactory in scope to the Bank, setting forth for each such period in
comparative form the corresponding figures for the appropriate period of the
preceding fiscal year, which statements shall be prepared on a Consolidated and
Consolidating basis and in accordance with GAAP and, subject to normal year-end
adjustments, present fairly the financial position of the Borrower as at the end
of the period involved. Such statements shall be accompanied by a schedule of
all Properties then owned by the Borrower;
5.5.2 As soon as practicable after the end of each
fiscal year of the Borrower, but in any event not later than 120 days
thereafter, a balance sheet of the Borrower as at the end of such fiscal year
and the related
-25-
statements of income, retained earnings, stockholders equity and changes in cash
flows of the Borrower for such year, all in reasonable detail and satisfactory
in scope to the Bank, setting forth in each case in comparative form the
corresponding figures for the preceding fiscal year, which statements shall be
prepared on a Consolidated and Consolidating basis and in accordance with GAAP
and audited by a firm of independent certified public accountants of recognized
standing selected by the Borrower and acceptable to the Bank;
5.5.3 Promptly upon receipt thereof, copies of all
financial reports (including, without limitation, management letters, if any)
submitted to the Borrower and each Subsidiary by its auditors, in connection
with each annual or interim audit review of its books by such auditors;
5.5.4 Promptly upon the issuance thereof, copies of all
regular, periodic and special reports, and all registration statements, which
the Borrower and each Subsidiary files with the Securities and Exchange
Commission or any other governmental agency or any securities exchange.
5.5.5 (i) Concurrently with the delivery of the
financial statements required to be furnished by Sections 5.5.1 and 5.5.2
hereof, a certificate signed by the chief executive officer or chief financial
officer of the Borrower, stating (a) that a review of the activities of the
Borrower during such period has been made under his immediate supervision with a
view to determining whether the Borrower and each Subsidiary has observed,
performed and fulfilled all of its obligations under this Agreement, and (b)
that there existed during such period no Default or Event of Default or if any
such Default or Event of Default did exist, specifying the nature thereof, the
period of existence thereof and what action the Borrower proposes to take, or
has taken, with respect thereto; and (ii) promptly upon the occurrence of any
Default or Event of Default, a certificate signed by the chief executive officer
or chief financial officer of the Borrower specifying the nature thereof and the
action the Borrower proposes to take or has taken with respect thereto;
5.5.6 Concurrently with the delivery of the annual
financial statements referred to in Section 5.5.2 a letter from the firm of
independent certified public accountants auditing such statements stating
whether such accountant's examination has revealed the occurrence of a
-26-
Default or an Event of Default and if so, stating the facts with respect thereto
and what action, if any, has been or will be taken by the Borrower to cure such
Default or Event of Default;
5.5.7 With reasonable promptness, such other information
respecting the business, operations and financial condition of the Borrower and
each Subsidiary as the Bank may reasonably from time to time request; and
5.5.8 Immediately upon becoming aware of any development
or other information which may materially and adversely affect any Property or
any of the other properties, business, prospects, profits or condition
(financial or otherwise) of the Borrower and each Subsidiary or the ability of
the Borrower and each Subsidiary to perform or comply with this Agreement or to
pay any of the Obligations, telephonic or telegraphic notice specifying the
nature of such development or information and such anticipated effect.
5.6 COMPLIANCE. The Borrower and each Subsidiary will comply
with the requirements of all applicable laws, rules, regulations, orders of any
governmental authority, and all agreements to which it is a party, the
noncompliance with which laws, rules, regulations, orders and agreements would
materially adversely affect the business, operations, prospects or assets, or
the condition, financial or otherwise, of the Borrower or any Subsidiary.
5.7 ERISA. The Borrower shall maintain compliance in all
material respects with the applicable provisions of ERISA. The Borrower will
deliver to the Bank, promptly after the filing or receiving thereof, copies of
all reports, including annual reports and notices, which the Borrower files with
or receives from the PBGC or the U.S. Department of Labor under ERISA; and as
soon as possible and in any event within 30 days after the Borrower knows or has
reason to know that any Reportable Event or Prohibited Transaction has occurred
with respect to any Plan or that the PBGC or the Borrower has instituted or will
institute proceedings under Title IV of ERISA to terminate any Plan, the
Borrower will deliver to the Bank a certificate of the chief executive officer
or chief financial officer of the Borrower setting forth the details as to such
Reportable Event or Prohibited Transaction or Plan termination and the action
the Borrower proposes to take with respect thereto.
-27-
5.8 CHANGE IN BUSINESS. The Borrower will not make any material
change in the character of its business as carried on at the date hereof.
5.9 NOTIFICATION TO BANK. The Borrower shall promptly notify
the Bank of (i) any Default or Event of Default hereunder, (ii) any litigation
or proceedings that are instituted or threatened (to the knowledge of the
Borrower) against the Borrower or any Subsidiary or any of their respective
assets, (iii) each and every default by the Borrower under any obligation for
borrowed money which would permit the holder of such obligation to accelerate
its maturity, including the names and addresses of the holders of such
obligation and the amount thereof, and (iv) any change in the chief executive
office of the Borrower or location of any of the Borrower's Collateral from that
listed in any of the Financing Agreements.
5.10 ENVIRONMENT. The Borrower and each Subsidiary shall remain
in compliance with the provisions of all federal, state, and local
environmental, health, and safety laws, codes and ordinances, and all rules and
regulations issued thereunder; notify the Bank immediately of any notice of a
hazardous discharge or environmental complaint received from any governmental
agency or any other party; notify the Bank immediately of any hazardous
discharge from or affecting any of its premises; immediately contain and remove
the same, in compliance with all applicable laws; promptly pay any fine or
penalty assessed in connection therewith; permit the Bank to inspect any of the
Borrower's or any Subsidiary's premises, to conduct tests thereon, and to
inspect all books, correspondence, and records pertaining thereto; and at the
Bank's request, and at the Borrower's expense, provide a report of a qualified
environmental engineer, satisfactory in scope, form, and content to the Bank,
and such other and further assurances reasonably satisfactory to the Bank that
the condition has been corrected.
5.11 FURTHER ASSURANCES. The Borrower will duly execute and
deliver, or will cause to be duly executed and delivered, such further
instruments and documents, including, without limitation, additional security
agreements relating to the Collateral, Uniform Commercial Code financing
statements or amendments or continuations thereof, and will do or use its best
efforts to cause to be done such further acts as may be necessary or proper in
the Bank's opinion to effectuate the provisions or purposes of this Agreement
and the Financing Agreements.
-28-
5.12 ADDITIONAL BANK GUARANTORS. The Borrower shall promptly
inform the Bank of the creation or acquisition of any direct or indirect
Subsidiary and cause each direct or indirect Subsidiary not in existence on the
date hereof to enter into a guarantee of the Obligations in form and substance
satisfactory to the Bank, and to execute and deliver to the Bank a form of
security agreement in form and substance similar to a Security Agreement, and
cause the direct parent of each such Subsidiary to pledge all of the capital
stock of such Subsidiary pursuant to a pledge agreement in form and substance
satisfactory to the Bank.
SECTION VI. NEGATIVE COVENANTS
The Borrower covenants and agrees that, until all of the Obligations
are paid and satisfied in full, it shall comply, or cause compliance, with the
following covenants:
6.1 INVESTMENTS AND GUARANTEES.
6.1.1 Neither the Borrower nor any Subsidiary will
directly or indirectly, make or permit to be outstanding any loan or advance to
any Person or purchase or acquire any capital stock, assets, obligations or
other securities of, or make any capital contribution to, or otherwise invest
in, or acquire any interest in, any Person, or participate as a partner or joint
venturer with any other Person, other than (i) Cash Equivalents, (ii) ordinary
and reasonable travel expense advances made to employees in the ordinary course
of business, (iii) loans to employees of the Borrower; provided, however, that
the aggregate outstanding principal sum of all such loans shall not exceed
$250,000, (iv) investments in stock of any Subsidiary; provided that the
Borrower complies with the provisions of Section 5.12 in connection with such
investment, and (v) the acquisition of fee title to Properties.
6.1.2 Neither the Borrower nor any Subsidiary will
directly or indirectly, assume, guarantee, endorse or otherwise be or become
directly or contingently responsible or liable for the obligations of any Person
(including, but not limited to, an agreement to purchase any obligation, stock,
assets, goods or services or to supply or advance any funds, assets, goods, or
services other than in the ordinary course of business, or otherwise to assure
the creditors of any Person against loss) other than (i) guarantees by
endorsement of negotiable instruments for deposit or collection or similar
transactions in the ordinary course of
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business, (ii) guarantees in favor of the Bank, or (iii) the guarantee by the
Borrower (for mortgage loans to Borrower or to any Subsidiary of Borrower) of
items that are commonly excepted by institutional lenders from their otherwise
nonrecourse mortgage loans which shall be deemed to including the following: (A)
misrepresentation in connection with the loan application, (B) misappropriation
of security deposits, insurance proceeds and condemnation proceeds, (C)
misappropriation of rents following default, (D) losses due to the environmental
contamination of the subject property and (E) waste to the subject property.
6.2 LIMITATION ON LIENS. Neither the Borrower nor any
Subsidiary will create, assume or suffer to exist any security interest
mortgage, pledge or other lien of any kind (a "lien") with respect to its real
or personal property, whether now owned or hereafter acquired, except for: (i)
liens in favor of the Bank, (ii) liens in favor of the Other Lenders created
under the other Lender Credit Agreements; (iii) liens for taxes or assessments
or other government charges or levies not yet due and payable or if due and
payable being actively contested in good faith by appropriate proceedings and
for which appropriate reserves are maintained; (iv) liens imposed by law, such
as mechanics', materialmen's, landlords', warehousemen's and carriers' liens,
securing obligations incurred in the ordinary course of business which are not
past due or which are being actively contested in good faith by appropriate
proceedings and for which appropriate reserves have been established; (v) liens
under workmen's compensation, unemployment insurance, social security or similar
legislation; (vi) liens, deposits, or pledges to secure the performance of bids,
tenders, contracts (other than contracts for the payment of money), leases,
statutory obligations, surety and appeal bonds or other similar obligations
arising in the ordinary course of business; (vii) judgment and other similar
liens arising in connection with court proceedings, provided the execution or
other enforcement of such liens is effectively stayed and the claims secured
thereby are being actively contested in good faith and by appropriate
proceedings; (viii) liens existing on the date hereof and listed on Schedule
4.12 hereto (and extension, renewal and replacement liens upon the same property
subject to such listed lien, provided that, subject to the provisions of Section
6.3(vi), the amount secured by each such lien constituting such an extension,
renewal or replacement lien shall not exceed the amount secured by the lien
theretofore existing); and (ix) liens securing Indebtedness permitted under the
provisions of Section 6.3(vi).
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6.3 ADDITIONAL OBLIGATIONS. Neither the Borrower nor any
Subsidiary shall create, incur, assume or permit to exist any Indebtedness,
except: (i) Indebtedness incurred under this Agreement and the Financing
Agreements or any other agreement with the Bank; (ii) Indebtedness incurred
under the Other Credit Agreements provided that such Indebtedness does not
exceed the principal sum of $10,000,000; (iii) trade payables and current
operating liabilities (other than for borrowed money), in each case incurred in
the ordinary course of business and not more than 90 days past due (or if past
due the obligation with respect thereto is being actively contested in good
faith by appropriate proceedings and for which appropriate reserves are
maintained), (iv) Indebtedness secured by liens referred to in Section 6.2, (v)
any other Indebtedness which is subordinate in right of payment to the
Indebtedness of the Borrower hereunder, provided that the terms of such
Indebtedness and its subordination are previously approved by the Bank in
writing, and provided that no such Indebtedness shall be paid or prepaid other
than in accordance with such terms as have been previously approved in writing
by the Bank, and (vi) Indebtedness incurred or created after the date hereof and
secured by a specified Property, so long as the loan to value ratio does not
exceed 70%. with respect to such Indebtedness and, to the extent the incurrence
or creation of such Indebtedness constitutes a Mandatory Prepayment Event, the
prepayment required by Section 2.4.2(ii) is made to the Bank.
6.4 REIT. The Borrower shall not at any time fail to qualify as
a REIT, as defined in Section 856 of the Internal Revenue Code of 1986.
6.5 MERGERS, ETC. Neither the Borrower nor any Subsidiary will
dissolve or otherwise sell or dispose of all or any substantial part of its
assets, including its accounts receivable (except that any such sale or
disposition shall be permitted if it is a Mandatory Prepayment Event and the
prepayment required by Section 2.4.2(ii) is made to the Bank), and will not
consolidate with or merge into another entity or business or permit one or more
entities to consolidate with or merge into it.
6.6 NET WORTH. From the date hereof through February 28,
1999, the Net Worth of the Borrower shall not at any time be less than the
greater of (i) $28,000,000; or (ii) an amount equal to two (2) times the
outstanding principal amount of Revolving Credit Loans. At all times
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during the Final Year, the Net Worth of the Borrower shall not at any time be
less than the greater of (i) $30,000,000; or (ii) an amount equal to two (2)
times the outstanding principal amount of the Revolving Credit Loans.
6.7 CASH FLOW. As of the end of each fiscal year of the Borrower
ending prior to February 28, 1999, the Cash Flow of the Borrower for such fiscal
year shall not be less than $3,000,000. As of the end of any fiscal year of the
Borrower ending after February 28, 1999, the Cash Flow of the Borrower for such
fiscal year shall not be less than $3,400,000.
6.8 MANAGEMENT.
6.8.1 At least two of Messrs. Xxxxxxxx X. Xxxxx, Xxxxxxx X.
Xxxxx, and Xxxxxxx X. Xxxxx shall at all times be actively involved in the day-
to-day management of the business and affairs of the Borrower, subject to
absence as a result of reasonable vacation or illness, and shall hold the office
(or a higher office) set forth opposite his name.
Xxxxxxxx X. Xxxxx Chairman of the Board of
Directors
Xxxxxxx X. Xxxxx President and CEO
Xxxxxxx X. Xxxxx Vice President
6.9 TRANSACTIONS WITH AFFILIATES. The Borrower shall not enter into
any transactions, including, without limitation, the lease, purchase, sale or
exchange of property or any agreement or arrangement for the payment, directly
or indirectly, of any fees, charges or other expenses resulting from any
allocation of general overhead, management fees or other similar services, with
any stockholder, director, officer, partner, employee or agent of the Borrower,
or any Affiliate of the Borrower, except in the ordinary course of and pursuant
to the reasonable requirement of the businesses of the Borrower and upon fair
and reasonable terms no less favorable than it would obtain in a comparable
arm's length transaction with a non-Affiliate.
6.10 WAIVER OF RIGHTS UNDER THE MORTGAGE NOTES. The Borrower shall
not modify, extend or amend any of the Mortgage Notes or Mortgages or waive any
of its rights thereunder without obtaining the prior written consent of the Bank
in each instance.
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SECTION VII. EVENTS OF DEFAULT/REMEDIES.
7.1 EVENTS OF DEFAULT. The occurrence of any one or more of the
following events shall constitute an "Event of Default":
7.1.1 any representation or warranty made or deemed made in
or in connection with this Agreement or any of the Financing
Agreements shall prove to have been materially incorrect when made or
deemed to be made;
7.1.2 default shall be made in the payment of any principal
of the Note when and as the same shall become due and payable, whether
at the due date thereof or at a date fixed for prepayment thereof or
by acceleration thereof or otherwise, and such default shall continue
unremedied for a period of five or more days;
7.1.3 default shall be made in the payment of any interest
on the Note, or any fee or any other amount payable hereunder, or
under any Financing Agreements, when and as the same shall become due
and payable, and such default shall continue unremedied for a period
of five (5) or more days;
7.1.4 default shall be made in the due observance or
performance of covenant, agreement or provision contained in this
Agreement (other than as described in Section 7.1.1 through 7.1.3
above) or any of the Financing Agreements by the Borrower or a
Subsidiary, and (except with respect to defaults under Section 5.2.2,
Section 5.12 or Section 6 hereof, the fifth sentence of Section 4 and
the second and fourth sentences of Section 13 of the Security
Agreements, as to which no grace period shall be applicable) such
default shall continue unremedied for thirty (30) or more days, or if
this Agreement or any Financing Agreements shall terminate, be
terminable or be terminated or become void or unenforceable for any
reason whatsoever without the prior written consent of the Bank; or
7.1.5 the Borrower or any Subsidiary shall (i) voluntarily
commence any proceeding or file any petition seeking relief under
Title 11 of the United States Code or any other Federal, state
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or foreign bankruptcy, insolvency, liquidation or similar law, (ii)
consent to the institution of, or fail to contravene in a timely and
appropriate manner, any such proceeding or the filing of any such
petition, (iii) apply for or consent to the appointment of a receiver,
trustee, custodian, sequestrator or similar official for the Borrower
or any Subsidiary or for a substantial part of its property or assets,
(iv) file an answer admitting the material allegations of a petition
filed against it in any such proceeding, (v) make a general assignment
for the benefit of creditors, (vi) become unable, admit in writing its
inability or fail generally to pay its debts as they become due or
(vii) take corporate action for the purpose of effecting any of the
foregoing;
7.1.6 an involuntary proceeding shall be commenced or an
involuntary petition shall be filed in a court of competent
jurisdiction seeking (i) relief in respect of the Borrower or any
Subsidiary, or of a substantial part of the property or assets of the
Borrower or any Subsidiary, under Title 11 of the United States Code
or any other Federal state or foreign bankruptcy, insolvency,
receivership or similar law, (ii) the appointment of a receiver,
trustee, custodian, sequestrator or similar official for the Borrower
or any Subsidiary or for a substantial part of the property of the
Borrower or any Subsidiary or (iii) the winding-up or liquidation of
the Borrower or any Subsidiary; and such proceeding or petition shall
continue undismissed for 30 days or an order or decree approving or
ordering any of the foregoing shall continue unstayed and in effect
for 30 days;
7.1.7 default shall be made with respect to any
Indebtedness (excluding Indebtedness outstanding hereunder) in an
aggregate amount exceeding $50,000 if the effect of any such default
shall be to accelerate, or to permit the holder or obligee of any such
Indebtedness (or any trustee on behalf of such holder or obligee) at
its option to accelerate, the maturity of such Indebtedness;
7.1.8 a judgment or decree for the payment of money, a fine
or penalty which when taken together with all other such judgments,
decrees, fines and penalties shall exceed $50,000 shall be
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rendered by a court or other tribunal against the Borrower or any
Subsidiary and (i) shall remain undischarged or unbonded for a period
of 30 consecutive days during which the execution of such judgment,
decree, fine or penalty shall not have been stayed effectively or (ii)
any judgment creditor or other person shall legally commence actions
to collect on or enforce such judgment, decree, fine or penalty;
7.1.9 this Agreement, the Note, any of the Security
Agreements, or any other Financing Agreements shall for any reason
cease to be, or shall be asserted by the Borrower or any Subsidiary
not to be, a legal, valid and binding obligation of the Borrower or
such Subsidiary (as the case may be), enforceable in accordance with
its terms, or the security interest or lien purported to be created by
any Security Agreement shall for any reason cease to be, or be
asserted by the Borrower or any Subsidiary not to be, a valid, first
priority perfected security interest in any of the Collateral covered
thereby (except to the extent otherwise permitted under this
Agreement);
7.1.10 the Bank shall determine in the exercise of its
reasonable judgment that a material adverse change has occurred in the
financial condition or business or prospects of the Borrower or any
Subsidiary or in the value of the Collateral or prospects for
repayment in full when due of any other Obligations;
7.1.11 If (i) a reportable event (within the meaning of
Section 4043(b) of ERISA) (whether or not waived) shall have occurred
with respect to a Plan which could, in the opinion of the Bank, have a
material adverse effect on the financial condition of the Borrower or
any of its ERISA Affiliates, (ii) the filing by the Borrower or any of
its ERISA Affiliates or an administrator of any Plan of a notice of
intent to terminate such Plan in a "distress termination" under the
provisions of Section 4041 of ERISA, (iii) the receipt of notice by
the Borrower or any of its ERISA Affiliates or an administrator of a
Plan that the PBGC has instituted proceedings to terminate (or appoint
a trustee to administer) such a Plan, (iv) any other event or
condition exists which might, in the opinion of the
-35-
Bank, constitute grounds under the provisions of Section 4042 of ERISA
for the termination of (or the appointment of a trustee to administer)
any Plan by the PBGC, (v) a Plan shall fail to maintain the minimum
funding standard required by Section 412 of the Internal Revenue Code
for any plan year or a waiver of such standard is sought or granted
under the provisions of Section 412(d) of the Internal Revenue Code
which could, in the opinion of the Bank, have a material adverse
effect on the financial condition of the Borrower or any of its ERISA
Affiliates, (vi) the Borrower or any of its ERISA Affiliates has
incurred, or is likely to incur, a liability under the provisions of
Sections 4062, 4063, 4064 or 4201 of ERISA which could, in the opinion
of the Bank, have a material adverse effect on the financial condition
of the Borrower or any of is ERISA Affiliates; and in each case in
clauses (i) through (vi) of this Section 7.1.11, such event or
condition, together with all other such events or conditions, if any,
could subject the Borrower or any of its ERISA Affiliates to any tax,
penalty or other liabilities in the aggregate material in relation to
the business, operations, property or financial or other condition of
the Borrower or any of its ERISA Affiliates; or
7.1.12 If any federal, state, or local agency asserts or
creates a lien upon any or all of the assets, equipment, property,
leaseholds, or other facilities of the Borrower by reason of the
occurrence of a hazardous discharge or an environmental complaint; or
if any federal, state, or local agency asserts a claim against the
Borrower and/or its assets, equipment, property, leaseholds, or other
facilities for damages or cleanup costs relating to a hazardous
discharge or an environmental complaint; provided, however, that such
claim shall not constitute a default if, within five (5) business days
of the occurrence giving rise to the claim, (i) the Borrower can prove
to the Bank's satisfaction that the Borrower has commenced and is
diligently pursuing either: (a) a cure or correction of the event
which constitutes the basis for the claim, and continues diligently to
pursue such cure or correction to completion or (b) proceedings for an
injunction, a restraining order, or other appropriate emergent relief
preventing such agency or agencies from asserting such claim, which
relief is
-36-
granted within ten (10) business days of the occurrence giving rise to
the claim and the injunction, order, or emergent relief is not
thereafter resolved or reversed on appeal; and (ii) in either of the
foregoing events, the Borrower has posted a bond, letter of credit, or
other security satisfactory IN form, substance, and amount of both the
Bank and the agency or entity asserting the claim to secure the proper
and complete cure or correction of the event which constitutes the
basis for the claim.
7.2 REMEDIES. Upon the occurrence of any one or more of such
Events of Default, the Bank may, at its option, without presentment for payment,
demand, notice of dishonor or notice of protest or any other notice, all of
which are hereby expressly waived by the Borrower, declare any and all of the
Revolving Loans to be due and payable; provided, however, that if such event is
an event specified in Section 7.1.5 or 7.1.6, then the Revolving Loans shall
automatically become due and payable. The Bank shall have all of the rights and
remedies of a Secured Party under the Uniform Commercial Code of the State of
New York and under the Uniform Commercial Code of any other state in which any
Collateral may be situated, and, additionally, all of the rights and remedies
set forth in this Agreement and the Financing Agreements, and in any instrument
or document referred to herein or therein, and under any other applicable law
relating to this Agreement or the Financing Agreements. The Bank may, at its
option, cure any default by the Borrower or a Subsidiary under any agreement
with a third party which constitutes, or would with notice or lapse of time or
both constitute, an Event of Default hereunder, and may add the amount expended
in such cure to the Obligations and charge the Borrower's account therefor, such
amounts to be repayable by the Borrower on demand; the Bank shall be under no
obligation to effect such cure and shall not by making any payment for the
Borrower's account be deemed to have assumed any obligation or liability of the
Borrower.
SECTION VIII. MISCELLANEOUS.
8.1 EX-PENSES. The Borrower, whether or not the transactions
contemplated hereby are consummated, shall pay to the Bank, or reimburse the
Bank for, all out-ofpocket expenses incurred by the Bank in connection with the
preparation, administration and enforcement of this Agreement, the Financing
Agreements, all other agreements, instruments and documents executed and
delivered in connection herewith and therewith, and the transactions contem-
-37-
plated hereunder and thereunder, together with any amendments, supplements,
consents or modifications which may be hereafter made or entered into in respect
thereof, including, but not limited to, filing fees, expenses for searches, and
the reasonable fees and disbursements of counsel to the Bank. The Bank is
hereby authorized to charge any amounts payable hereunder directly to the
account(s) of the Borrower maintained with the Bank.
8.2 SURVIVAL OF AGREEMENT. All agreements, representations and
warranties contained herein or made in writing by the parties hereto in
connection with the transactions contemplated hereby shall survive the execution
and delivery of this Agreement, the Financing Agreements and the consummation of
the transactions contemplated herein or therein regardless of any investigation
made by or on behalf of the Bank.
8.3 NO WAIVER; CUMULATIVE REMEDIES. No failure to exercise, and
no delay in exercising on the part of the Bank, any right, power or privilege
under this Agreement or under any of the Financing Agreements or other documents
referred to herein or therein shall operate as a waiver thereof; nor shall any
single or partial exercise of any right, power or privilege hereunder or
thereunder preclude any other or further exercise thereof or the exercise of any
other right, power and privilege. The rights and remedies of the Bank hereunder
and under the Financing Agreements and under any other present and future
agreements between the Bank and the Borrower are cumulative and not exclusive of
any rights or remedies provided by law, or under any of said Financing
Agreements or agreements and all such rights and remedies may be exercised
successively or concurrently.
8.4 NOTICES. All notices, approvals, consents, requests,
demands or other communications (collectively, "Communications") to or upon the
respective parties hereto shall be made in writing in one of the following ways
and shall be deemed to have been given, received and dated: if by hand (with
receipt acknowledged), immediately upon delivery; if by express mail or any
other overnight delivery service, one day after dispatch; and if by certified
mail, return receipt requested, four days after mailing. All Communications are
to be given to the following addresses (or to such other address as any party
may designate by Communication in accordance with this Section):
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If to the Bank: Bank Leumi Trust Company of
New York
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxxxx Xxxxxx,
Vice President
with copies to: Xxxxxxx Xxxxxxxx Xxxxx
Xxxxxxxxxxx & Kuh, LLP
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxxxxx Xxxxxxx, Esq.
If to Borrower: One Liberty Properties,
Inc.
00 Xxxxxx Xxxx Xxxx
Xxxxx Xxxx, Xxx Xxxx 00000
Attn: Xxxxxxx X. Xxxxx,
President
8.5 AMENDMENTS AND WAIVERS. Neither this Agreement, nor any of
the Financing Agreements or any other instrument or document referred to herein
or therein may be changed, waived, discharged or terminated orally, except by an
instrument in writing signed by the party against whom enforcement of the
change, waiver, discharge or termination is sought.
8.6 APPLICABLE LAW. This Agreement and the Financing
Agreements and any other document referred to herein or therein and the
obligations of the parties hereunder or thereunder are being executed and
delivered in New York, New York and shall be construed and interpreted in
accordance with the laws of the State of New York applied to agreements entered
into and performed therein.
8.7 SUCCESSORS. This Agreement, the Financing Agreements and
any other document referred to herein or therein shall be binding upon and inure
to the benefit of and be enforceable by the parties and their respective heirs,
successors and assigns, except that the Borrower may not assign its rights under
this Agreement, the Financing Agreements and any other document referred to
herein or therein without the prior written consent of the Bank.
8.8 PARTIAL INVALIDITY. If any provision of this Agreement or
the Financing Agreements is held to be invalid or unenforceable, such invalidity
or unenforceability shall not invalidate this Agreement or the Financing
-39-
Agreements as a whole but this Agreement or the particular Financing Agreement,
as the case may be, shall be construed as though it did not contain the
particular provision or provisions held to be invalid or unenforceable and the
rights and obligations of the parties shall be construed and enforced only to
such extent as shall be permitted by law.
8.9 HEADINGS AND WORD MEANINGS. The headings used herein are
for convenience only and do not constitute matters to be considered in
interpreting this Agreement. The words "herein," "hereinabove," "hereof," and
"hereunder," when used anywhere in this Agreement, refer to this Agreement as a
whole and not merely to a subdivision in which such words appear, unless the
context otherwise requires. The singular shall include the plural, the
masculine gender shall include the feminine and neuter and the disjunctive shall
include the conjunctive, and vice versa, unless the context otherwise requires.
8.10 WAIVER OF JURY TRIAL. THE PARTIES HERETO HEREBY WAIVE TRIAL
BY JURY IN ANY LITIGATION IN ANY COURT WITH RESPECT TO, IN CONNECTION WITH, OR
ARISING OUT OF THIS AGREEMENT, THE FINANCING AGREEMENTS OR ANY AGREEMENT,
INSTRUMENT OR DOCUMENT DELIVERED PURSUANT HERETO OR THERETO, OR THE VALIDITY,
PROTECTION, INTERPRETATION, ADMINISTRATION, COLLECTION OR ENFORCEMENT HEREOF OR
THEREOF, OR ANY OTHER CLAIM OR DISPUTE HEREUNDER OR THEREUNDER.
8.11 JURISDICTION; SERVICE OF PROCESS. The Borrower hereby
irrevocably consents to the jurisdiction of the Supreme Court of the State of
New York for the County of New York, and the United States District Court for
the Southern District of New York in connection with any action or proceeding
arising out of or relating to this Agreement, the Financing Agreements or any
agreement, document or instrument delivered pursuant hereto or thereto. In any
such litigation, Borrower waives personal service of any summons, complaint or
other process and agrees that the service thereof may be made by certified mail
directed to it at its address set forth herein, or designated in writing
pursuant to, this Agreement or in any other manner permitted by the rules of
either of said courts.
8.12 INDEMNITY. The Borrower hereby agrees to defend, indemnify,
and hold the Bank harmless from and against any and all claims, damages,
judgments, penalties, costs and expenses (including reasonable attorney fees and
court costs now or hereafter arising from the aforesaid enforcement of this
clause) arising directly or indirectly
-40-
from the activities of the Borrower, its predecessors in interest, or third
parties with whom it has a contractual relationship, or arising directly or
indirectly from the violation of any environmental protection, health, or safety
law, whether such claims are asserted by any governmental agency or any other
Person. This indemnity shall survive termination of this Agreement.
IN WITNESS WHEREOF, the parties have caused this Agreement to be duly
executed and delivered as of the day and year first above written.
One Liberty Properties,
By: /s/ Xxxxxxx Xxxxx
-------------------------
Xxxxxxx Xxxxx
Title: President
Bank Leumi Trust Company of New York
By: /s/ Xxxxxx Xxxxxx
-------------------------
Xxxxxx Xxxxxx
Title: Vice President
-41-
EXHIBIT A
NOTE
$5,000,000 New York, New York
March 1, 1996
A. GENERAL; TERMS OF PAYMENT
1. FOR VALUE RECEIVED, the undersigned, ONE LIBERTY PROPERTIES,
INC., a corporation organized under the laws of the State of Maryland (the
"Borrower"), promises to pay to the order of Bank Leumi Trust Company of New
York (the "Bank"), at its office at 000 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000,
or at such other place as may be designated by the holder hereof in writing, the
principal sum of FIVE MILLION ($5,000,000) DOLLARS or, if less, the aggregate
unpaid principal sum of all Revolving Loans made by the Bank to the Borrower
from time to time pursuant to a credit agreement, dated the date hereof, between
the Borrower and the Bank (the "Credit Agreement"), in one installment on
February 28, 1999.
The Bank is hereby authorized to enter on the schedule attached hereto
the amount of each Revolving Loan and each payment of principal thereon, without
any further authorization on the part of the Borrower or any endorser of this
Note, but the Bank's failure to make such entry shall not limit or otherwise
affect the obligations of the Borrower or any endorser of this Note.
The Borrower will pay interest on the unpaid principal amount of each
Revolving Loan from time to time outstanding, computed on the basis of a 360-day
year, at a rate per annum which shall be equal to one-half of one percent
(0.50%) above the rate of interest designated by the Bank, and in effect from
time to time, as its "Reference Rate", adjusted when said Reference Rate
changes, but in no event in excess of the maximum rate permitted by law. The
Borrower acknowledges that the Reference Rate may not necessarily represent the
lowest rate of interest charged by the Bank to its customers. Interest on the
unpaid principal amount of this Note shall be payable the first day of each
month in each year, commencing on the first day of the first full calendar month
after the date of this Note, at maturity (whether by acceleration or otherwise)
and upon the making of any prepayment, as herein provided. In addition, the
Borrower will pay interest on any overdue installment of principal for the
period for which overdue, on demand, at a rate equal to 3% per annum above the
rate of interest hereinabove indicated.
-1-
2. PREPAYMENT. (a) The Borrower shall have the right to prepay this
Note as provided in Section 2.4.1 of the Credit Agreement.
(b) The outstanding principal sum of this Note is subject to
mandatory prepayment as provided in Section 2.4.2 of the Credit Agreement.
3. MANNER OF PAYMENT. All payments by the Borrower on account of
principal, interest or fees hereunder shall be made in lawful money of the
United States of America, in immediately available funds. The Borrower
authorizes (but shall not require) the Bank to debit any account maintained by
the Borrower with the Bank, at any date on which a payment is due under this
Note, in an amount equal to any unpaid portion of such payment. If any payment
of principal or interest becomes due on a day on which the Bank is closed (as
required or permitted by law or otherwise), such payment shall be made not later
than the next succeeding business day, and such extension shall be included in
computing interest in connection with such payment.
B. DEFAULT
Upon the occurrence of an Event of Default, as defined in the Credit
Agreement, and during the continuance thereof, the entire unpaid principal
amount of this Note and all interest and fees accrued and unpaid hereon may be
declared to be (or shall immediately become) due and payable in the manner and
with the effect provided in the Credit Agreement.
C. MISCELLANEOUS
1. NO WAVIER: RIGHTS AND REMEDIES CUMULATIVE. No failure on the
part of the Bank to exercise, and no delay in exercising any right hereunder
shall operate as a waiver thereof; nor shall any single or partial exercise by
the Bank of any right hereunder preclude any other or further exercise thereof
or the exercise of any other right. The rights and remedies herein provided are
cumulative and not exclusive of any remedies or rights provided by law or by any
other agreement between the Borrower and the Bank.
2. COSTS AND EXPENSES. The Borrower shall reimburse the Bank for
all costs and expenses incurred by it and shall pay the reasonable fees and
disbursements of counsel to the Bank in connection with the enforcement of the
Bank's rights hereunder.
3. AMENDMENTS. No amendment, modification or waiver of any
provision of this Note nor consent to any departure by the
-2-
Borrower therefrom shall be effective unless the same shall be in writing and
signed by the Bank and then such waiver or consent shall be effective only in
the specific instance and for the specific purpose for which given.
4. CONSTRUCTION. This Note shall be governed by the laws of the
State of New York, without giving effect to its choice of law principles. The
Borrower hereby irrevocably consents to the jurisdiction of the Supreme Court of
the State of New York for the County of New York, and the United States District
Court for the Southern District of New York, in connection with any action or
proceeding arising out of or relating to this Note, and the Borrower further
irrevocably consents to the service or process in any such action or proceeding
by the mailing of a copy of such process to the Borrower by Certified Mail,
Return Receipt Requested, at the address set forth below. In the event of
litigation between the Bank and the Borrower over any matter connected with this
Note, the right to a trial by jury is hereby waived by the Bank and the
Borrower.
5. SUCCESSORS AND ASSIGNS. This Note shall be binding upon the
Borrower and its successors and assigns and the terms hereof shall inure to the
benefit of the Bank and its successors and assigns, including subsequent holders
hereof.
6. SEVERABILITY. The provisions of this Note are severable, and if
any provision shall be held invalid or unenforceable in whole or in part in any
jurisdiction, then such invalidity or unenforceability shall not in any manner
affect such provision in any other jurisdiction or any other provision of this
Note in any jurisdiction.
7. WAIVER OF NOTICE; SET-OFF. The Borrower hereby waives
presentment, demand for payment, notice of protest and all other demands in
connection with the delivery, acceptance, performance, default or enforcement of
this Note. The balance of every account of the Borrower with, and each claim of
the Borrower against, the Bank existing from time to time shall be subject to a
lien and subject to be set-off against any and all liabilities of the Borrower
to the Bank, including those hereunder.
-3-
8. CREDIT AGREEMENT. This Note is the Note referred to in the
Credit Agreement and the holder hereof is entitled to the benefits thereof and
of the other Financing Agreements (as defined in the Credit Agreement).
One Liberty Properties, Inc.
By:
----------------------------------------------------
,President
Address:
00 Xxxxxx Xxxx Xxxx
Xxxxx Xxxx, Xxx Xxxx 00000
-4-
Exhibit B to
Credit Agreement
Form of Notice of Borrowing
NOTICE OF BORROWING
________________ __, 00__
XXXX XXXXX XXXXX XXXXXXX XX XXX XXXX
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention:__________________________
1. (a) One Liberty Properties, Inc., ("Company") pursuant to the
Credit Agreement dated as of March 1, 1996, hereby requests Bank Leumi Trust
Company of New York to make a Revolving Loan on the following terms:
Principal Amount of Revolving Loan: $
Date of Revolving Loan:
(b) The Company requests Bank Leumi Trust Company of New York
to apply the proceeds of the Revolving Loan as follows:
Transfer to financial institution and account
shown below:
Financial Institution:
Account No.: $
Total (same as principal amount of Revolving Loan): $
B-1
2. Capitalized terms used in this Notice shall have the meanings
set forth in the Credit Agreement.
ONE LIBERTY PROPERTIES, INC.
By:
------------------------------------------
Name:
----------------------------------------
Title:
---------------------------------------
B-2
EXHIBIT C
[Logo]
SECURITY AGREEMENT
In consideration of financial accommodation heretofore extended or to be
extended or continued to the undersigned by BANK LEUMI TRUST COMPANY OF NEW YORK
(the "Bank"), the undersigned hereby agrees as follows:
1. As security for the full and prompt payment of any and all Liabilities
(as hereinafter defined), the undersigned hereby assigns and transfers to the
Bank and grants the Bank a security interest in all Security (as hereinafter
defined). Said grant is made for the benefit of the Bank and/or any others
having a participation or other interest in any of the Liabilities, in such
proportions as the Bank shall in its sole discretion determine.
2. The term "Liabilities" as used herein shall include all liabilities and
obligations of any kind of the undersigned (or any partnership or other group of
which the undersigned is a member) to (i) the Bank, (ii) any group of which the
Bank is a member or (iii) any other person if the Bank has a participation or
other interest in such liabilities or obligations, whether (a) for the Bank's
own account or as agent for others, (b) acquired directly or indirectly by the
Bank from the undersigned or others, (c) absolute or contingent, joint or
several, secured or unsecured, liquidated, due or not due, contractual or
tortious, now existing or hereinafter arising, or (d) incurred by the
undersigned as principal, surety, endorser, guarantor or otherwise, and
including without limitation all expenses, including attorneys' fees, incurred
by the Bank in connection with any such liabilities or obligations or any
Security therefor.
3. The term "Security" as used herein shall include all of the property
described in Schedule A hereto.
4. The right is granted to the Bank, in its discretion, to file one or more
financing statements (with or, to the extent permitted by law, without the
signature of the undersigned) under the Uniform Commercial Code naming the
undersigned as debtor and the Bank as secured party and indicating therein the
types of describing the items of Security herein specified. The undersigned will
execute, file and record any notices, affidavits or other documents and take all
such other undersigned hereby agrees to pay on demand, and/or authorizes the
Bank to charge its account with the cost of, any and all filing, recording and
other fees and expenses which the Bank deems appropriate in order to protect or
perfect its security interest in the Security or to otherwise accomplish the
purposes of this notify the Bank of the imposition at any time of any lien or
encumbrance upon any of the Security. Notwithstanding the foregoing, the
undersigned will promptly notify the Bank of the imposition at any time of any
lien or encumbrance upon any of the Security. Notwithstanding the foregoing, the
undersigned represents, warrants and covenants that all of the Security now
existing or hereafter arising or acquired is and will be owned by the
undersigned free and clear of all security interests, liens and encumbrances of
any kind, except for the security interest herein granted to the Bank. The
undersigned shall promptly pay when due all taxes and transportation, storage
and warehousing charges affecting or arising out of the Security. The
undersigned will defend the Security against all claims and demands of all
persons at any time claiming the same or any interest therein adverse to the
Bank.
Notwithstanding the foregoing, the Bank shall have no obligation to comply
with any recording, re-recording, filing, re-filing, or other legal requirements
necessary to establish or maintain the validity, priority or enforceability of,
or the Bank's right in or to, the Security or any part thereof.
5. The right is granted to the Bank, its discretion, at any time, (a) to
transfer to or register in the name of itself or any of its nominees any of the
Security, and whether or not so transferred or registered, to receive the income
and dividends thereon, including stock dividends and rights to subscribe, and to
hold the same as a part of the Security and/or apply the same as hereinafter
provided; (b) to exchange any of the Security for other property upon any
reorganization, recapitalization, or other readjustment and in connection
therewith to deposit any of the Security with any committee or depositary upon
such terms as the Bank may determine; (c) in any bankruptcy or similar
proceeding to file a proof of claim for the full amount of the Security and to
vote such claim for or against any arrangement or with respect to any other
matter; (d) in its own name or in the name of the undersigned or any other
appropriate person, to demand, xxx for, collect or receive any money or property
at any time payable or receivable on account of or in exchange for, or make any
compromise or settlement it may deem desirable with respect to, any of the
Security, (e) to extend the time of payment, arrange for payment in
installments, or otherwise modify the terms of, or release, any of the Security;
(f) to contest, pay and/or discharge all liens, encumbrances, taxes or
assessments on, or claims, actions or demands against, any of the Security and
to take all actions and proceedings in its own name or in the name of the
undersigned or any other appropriate person in order to remove or contest such
liens, encumbrances, taxes, assessments, claims, actions or demands; or to
refrain from doing any of the foregoing, all without affecting the Liabilities
and the Security and without notice or liability to or the consent of the
undersigned except to account for property actually received by the Bank. The
undersigned hereby irrevocably appoints the Bank its attorney-in-fact, with
authority to receive, open and dispose of all mail addressed to the undersigned
and to notify the Post Office authorities to change the address for delivery of
mail addressed to the undersigned to such address as the Bank may designate; to
endorse the name of the undersigned on any instruments that may come into the
bank's possession; to sign the name of the undersigned on any notices to account
debtors of the undersigned and requests for verification of accounts; to sign
the name of the undersigned on any assignment or other instruments of conveyance
or transfer of any of the Security; and to take all such other actions as the
Bank may deep appropriate to carry out and enforce this agreement and to
exercise the Bank's rights hereunder. The Bank shall not be obligated to
exercise any authority or right granted to it hereunder and shall not be liable
for any action taken or omitted or the manner of taking any action, except for
its willful misconduct, and in no event for consequential damages.
6. The undersigned will pay to the Bank all costs and expenses incurred and
sums paid by the Bank (including without limitation reasonable attorneys' fees,
insurance premiums and sales commissions) in connection with the custody, care,
collection, repair, storage or preparation for or any actual or attempted
disposition of any of the Security, the collection of any proceeds of insurance
with respect to the Security or otherwise in connection with this agreement.
7. At any time and from time to time, upon demand by the Bank, the
undersigned will (a) deliver to the Bank, endorsed and/or accompanied by
instruments of assignment and transfer, in such form and containing such terms
as the Bank may request, any and all instruments, documents and/or chattel paper
constituting part of the Security, as the Bank may specify in its demand, (b)
xxxx all Security and all books and records relating thereto in such manner as
the Bank may require, and (c) permit representatives of the BANK at any time to
inspect the Security and to inspect and make abstracts from any of the
undersigned's books and records and to answer promptly all of the Bank's written
or oral inquiries with respect thereto. If the undersigned, as registered holder
of any of the Security, shall receive any stock certificate, option or right,
whether as an addition to, or in substitution or exchange for, any Security, or
otherwise, the undersigned agrees to accept the same as the Bank's agent and to
hold the same in trust for the Bank, and to forthwith deliver the same to the
Bank in the exact form received, with the undersigned's endorsement thereof if
requested by the Bank, to be held by the Bank as part of the Security. The
undersigned assigns to the Bank all of the undersigned's rights (but none of its
obligations) in, to and under all collateral, guarantees, subordinations and
other rights and benefits now or hereafter received by the undersigned with
respect to the Security and agrees to deliver to the Bank, upon demand, all
agreements, instruments and/or documents evidencing same, endorsed and/or
accompanied by instruments of assignment and transfer, in such form and
containing such terms as the Bank may request.
8. Upon demand from the Bank at any time that any of the Liabilities are
outstanding, the undersigned will assign and transfer to the Bank and grant to
the Bank a security interest in additional Security of a value and character
satisfactory to the Bank or make such payment on account of the Liabilities as
the Bank may require.
9. Upon the occurrence of an Event of Default (as hereinafter defined), (a)
any or all of the Liabilities shall, at the option of the Bank and
notwithstanding any time or credit allowed by any instrument evidencing a
Liability, be immediately due and payable without notice, demand or presentment;
(b) the Bank may, in its discretion, take possession of the Security and, for
that purpose, may enter, with the assistance of any persons, any premises where
the Security or any part thereof may be located, and retain possession of the
Security at such premises or remove the same therefrom; (c) the undersigned
shall, at the request of the Bank assemble the Security at such places as the
Bank may designate and cooperate in all other respects with the Bank in the
exercise of its rights hereunder; (d) the Bank may vote any shares of stock or
other securities and exercise all or any powers with respect hereto with the
same force and effect as an absolute owner thereof; (e) the Bank may sell any of
the Security or cause the same to be sold in the Borough of Manhattan, New York
City, or elsewhere, in one or more sales or parcels, at such price and on such
terms as the Bank may deem advisable, for cash or on credit, for immediate or
future delivery, without assumption of any credit risk, at any public or private
sales or other dispositions, without demand of performance (which demand is
hereby expressly waived), on at least 5 days notice to the undersigned (if any
notice is required by law) of any public sale or the time after which a private
sale or other disposition may be made (which notice the undersigned acknowledges
is reasonable), and in connection therewith may grant options and may impose
reasonable conditions thereon, and the purchasers of
any of the Security so sold shall thereafter hold the same absolutely, free from
any claim or right of any kind, including any equity of redemption of the
undersigned (any such equity being hereby expressly waived and released), and
the Bank or any of its nominees or agents may buy at any public sale and if the
Security is of a type sold in a recognized market, or is of a type which is the
subject of widely distributed standard price quotations, buy at private sale;
and (f) in addition to and notwithstanding any other rights granted by law or
herein (or any limitations contained herein on any such rights), the Bank shall
have the rights and remedies with respect to the Security of a secured party
under the Uniform Commercial Code of the State of New York. The undersigned
agrees that any action taken by the Bank in accordance with this paragraph shall
be deemed to be commercially reasonable.
10. As used in this agreement, the term "Event of Default" shall have the
meaning ascribed to it in that certain Credit Agreement dated of even date
herewith between the Bank and undersigned (the "Credit Agreement").
11. Notwithstanding the continued possession of the Security by the Bank,
whether on its own behalf or on behalf of others, the undersigned shall remain
liable for the payment in full of the Liabilities. The undersigned assumes all
liability and responsibility for the Security, and the obligation of the
undersigned to pay the Liabilities shall in no way be affected or diminished by
reason of the fact that any of the Security may be lost, destroyed, stolen,
damaged or for any other reason whatsoever unavailable to the undersigned or the
at the value of the Security shall be diminished. In the event of any partial or
complete loss or destruction of any of the Security by any means, the
undersigned shall, at its own expense, cause such repairs to be made as the Bank
may deem appropriate fro its protection or, at the option of the Bank, replace
the security with new Security having a value equal to the value of the lost or
destroyed Security prior to such loss or destruction. The undersigned agrees, at
its own expense, to keep all insurable Security insure against loss or damage by
fire, theft or any other risk to which the Security may be subject ( including
without limitation such hazards as the Bank may specify), for the full insurable
value thereof, under policies and with insurers acceptable to the Bank, which
policies shall provide for all losses to be payable to the Bank and for at least
30 days prior notice to the Bank of any intended cancellation or modification of
the policy. The undersigned will deliver to the Bank on request policies or
certificates of such insurance with evidence of payment of the premium thereon.
If the undersigned fails to maintain said insurance, then, in addition to any
other right or remedy tat the Bank may have and without waiving the
consequences of such default, the bank may but need not obtain and maintain said
insurance, at the expense of the undersigned, which expense shall be deemed one
of the Liabilities and shall be payable to the BANK on demand. The Bank is
irrevocably authorized to fill claims and shall have the sole right to adjust,
settle and collect claims under said insurance by such means, at such times, on
such terms and in the name of the Bank or the undersigned, as the Bank may see
fit, and in the name and on behalf of the undersigned to execute releases and
endorse checks or drafts payable in respect of any such insurance claims. All
sums received by the Bank from any such insurance may be held as part of the
Security and/or applied as hereinafter provided.
12. The Bank, at any time, at its option, may apply all of any net cash
receipts from the Security (whether received on a sale of the Security in
accordance with paragraph 9 hereof, on collection in accordance with paragraph 5
hereof, as proceeds of insurance in accordance with paragraph 11 hereof, or
otherwise) to the payment, in whole or in part, of principal of and/or interest
on any or all of the Liabilities, whether or not then due, allocating the same
as it shall elect, making rebate of interest or discount to the extent required
by law and so as not to make the rate of interest charged unlawful with respect
to the undersigned. If any Liabilities shall be contingent, the Bank may retain
a sufficient amount of the net cash receipts from the Security to cover the
largest aggregate sum which may become due or owing thereunder with prospective
interest, cost, expenses and attorneys' fees and shall not be charged with any
interest with respect thereto.
13. The undersigned may not sell, lease, assign or otherwise dispose of any
of the Security without the prior written consent of the Bank. In addition, the
undersigned may not sell, assign or otherwise dispose of any shares of stock or
other securities now owned or hereafter acquired by the undersigned which are
issued by the same issuer and are of the same class as any shares of stock or
other securities constituting a part of the Security. The undersigned shall keep
all of the Non-possessory Security (as described in Schedule A hereto) at the
undersigned's premises listed in Schedule A hereto and shall not remove any of
the Non-Possessory Security therefrom without the Bank's prior written consent.
14. In any litigation or legal proceeding arising out of, or relating to ,
this agreement or any of the Liabilities or Security, in which the Bank and the
undersigned shall be adverse parties, the undersigned waives the right to
interpose any defense, set-off or counterclaim of any kind not directly arising
herefrom or therefrom, as the case may be, and also waives the right to a trial
by a jury. In the event that the Bank brings any action or suit in any court of
record of New York State or the Federal Government to enforce any or all of the
Liabilities or any of the Bank's rights hereunder, service of process may be
made upon the undersigned by mailing a copy of the summons to the undersigned at
its chief executive office set forth in Schedule A hereto, and the undersigned
hereby irrevocably submits to the jurisdiction of any New York State or Federal
court located in New York City over any action, suit or proceeding arising out
of any dispute between the undersigned and the Bank.
15. If in its sole discretion the Bank deems it desirable, it may remove
any Security held by it from the place where it may now or hereafter be located
to any other place and deal with it there as herein provided.
16. Upon the occurrence of an Event of Default, and at any time thereafter,
the Bank shall have and may exercise, without further notice, a right of set-off
and/or banker's lien against and in respect of any of the Security then or
thereafter held by the Bank. Any right of set-off exercised by the Bank shall be
deemed to have been exercised immediately on the occurrence of an Event of
Default, even though such set-off is made or entered on the books of the Bank
subsequent thereto.
17. If the time for payment of principal of or interest on any of the
Liabilities or any other money payable hereunder or with respect to any of the
Liabilities is extended because said sum becomes due on a Saturday, Sunday or
public holiday, interest shall be payable for such extended time.
18. The Bank shall not be deemed to have modified or waived any of its
rights hereunder or any terms or conditions hereof unless such modification or
waiver is in writing and signed by a duly authorized officer of the Bank. No
such modification or waiver, unless so expressly stated herein, shall be
effective as to any transaction which occurs subsequent to the date of such
modification or waiver nor shall it constitute a continuing modification or
waiver. No delay on the part of the Bank in exercising any power or right
hereunder shall operate as a waiver thereof; nor shall any single or partial
exercise of any power or right hereunder preclude any other or further exercise
thereof or the exercise of any other power or right. All rights and remedies of
the Bank with respect to the Liabilities or Security, Whether evidenced hereby
or by any other instrument or paper, shall be cumulative and may be exercised
singularly or concurrently.
19. The Bank may assign and/or transfer to any assignee or transferee of
any of the Liabilities any or all of the Security and the BANK's rights
hereunder with respect thereto, and thereafter the Bank shall be fully
discharged from all responsibility with respect to the Security so assigned
and/or transferred. Such assignee
or transferee shall be vested with all the powers and rights of the Bank
hereunder with respect to such Security, but the Bank shall retain all rights
and powers hereby given with respect to any of the Security not so assigned or
transferred. The undersigned will not assert against any assignee or transferee
of any of the Liabilities any claims or defenses it may have against the Bank.
20. The undersigned hereby waives presentment, notice of dishonor and
protest with respect to all instruments included in or evidencing the
Liabilities or the Security and except as specified herein, any and all other
notices and demands whatsoever, whether or not relating to such instruments.
21. The undersigned will indemnify and save the Bank harmless from and
against all loss or damage to it and any claims and actions, whether groundless
or otherwise, arising in connection with this agreement, the Liabilities or the
Security, and all costs and expenses (including attorneys' fees) incurred by the
Bank in respect thereof.
22. If any term, condition or provision of this agreement or document
executed in connection herewith or in connection with any of the Liabilities or
Security is determined to be invalid or unenforceable, such determination shall
not affect the validity or enforceability of any other term, condition or
provision.
23. Any demand upon or notice to the undersigned that the Bank may elect to
give shall be effective if deposited by certified mail addressed to or otherwise
delivered to the undersigned at its chief executive office or if the undersigned
has notified the Bank in writing by registered mail of a change of address, at
the last address of which the Bank has received notice. Demands or notices
addressed or otherwise delivered to the address at which the Bank customarily
communicates with the undersigned shall also be effective.
24. If any of the Security is or is to be attached to or installed or
located on real estate, the undersigned will upon demand furnish the Bank with a
disclaimer signed by all persons having an interest in said real estate of any
interest prior to the Bank's interest in the Security.
25. From and after maturity (whether by acceleration or otherwise) of any
of the Liabilities, any unpaid balance remaining shall bear interest at the rate
provided in Section 2.1.4(ii) of the Credit Agreement. Anything in this
agreement or any other agreement, instrument or document to the contrary
notwithstanding, in no event shall interest on any Liability exceed the maximum
rate permitted under any applicable law or regulation, and if any provision of
this agreement, instrument or document is in contravention of any such law or
regulation, such provision shall be deemed amended to provide for interest at
said maximum rate.
26. The undersigned, if more than one, shall be jointly and severally
liable hereunder and all provisions hereof regarding the liabilities or Security
shall apply to any Liability or any Security of any or all of them. This
agreement shall be binding upon the heirs, executors, administrators, successors
and assigns of the undersigned and shall inure to the benefit of the its
successors and assigns. For purposes of this agreement, the term "Bank" shall
include the Bank and any and all subsidiaries of the Bank. If all Liabilities
shall at any time be paid in full, this agreement shall nonetheless remain in
full force and effect with respect to any Liabilities thereafter incurred. If
the undersigned is a corporation, this agreement shall be binding upon any other
corporation into or with which the undersigned shall be merged, consolidated,
reorganized or absorbed, or which shall acquire the undersigned's business or
substantially all of its assets. If the undersigned is a partnership, the
members thereof shall also be individually bound and liable hereunder and this
agreement shall continue in force notwithstanding any change in or termination
of such partnership, whether such change occurs through death, retirement or
otherwise. Except as otherwise provided herein, all terms used herein which are
defined in the Uniform Commercial Code of the State of New York shall have the
meanings therein stated. If this agreement shall differ in terms with any other
agreement or obligation or the terms of any of the Liabilities, that which gives
the Bank the greater right shall prevail.
27. If any of the Security is applied on account of any of the Liabilities,
the undersigned shall not have any right of subrogation to the Bank's right in
any other Security held by the Bank with respect to the Liabilities or any right
of contribution from the Bank by reason thereof.
28. The Bank is authorized to correct patent errors herein. This agreement
shall take effect immediately upon execution by the undersigned, and the
execution hereof by the Bank shall not be required as a condition to the
effectiveness of this agreement.
29. Notwithstanding anything to the contrary contained herein, the term
"Security" as used herein shall be deemed to include any and all book-entry U.S.
at a bank which is a member of the Federal Reserve System. The undersigned
authorizes the Bank to serve as its bailee and agent with respect to the
aforementioned book-entry Treasury bills and other book-entry securities and to
take such action and to execute and deliver such documents on behalf of the
undersigned as the Bank deems necessary or desirable in order to perfect the
Bank's security interest therein. The undersigned hereby gives notice to the
Bank, in the Bank's capacity as bailee and agent, of the Bank's security
interest in the aforementioned book-entry Treasury bills and other book-entry
securities.
30. This agreement shall be interpreted, and all the rights and obligations
arising hereunder or from any document relating hereto shall be determined, in
accordance with the laws of the State of New York.
SEE RIDER ATTACHED HERETO AND MADE A PART HEREOF.
SCHEDULE A
The term "Security" shall include:
(1) All Possessory Security identified in paragraph (a) below,
(2) Unless box (v) below is checked and initialled by the Bank and the
undersigned, all Non-Possessory Security identified in paragraph(b) below
wherever located and whether now owned or hereafter acquire, and
(3) All substitutions for, all additions to (including without limitation
all dividends and other distributions on and all rights, privileges and
options relating to or declared or granted in connection with) and all
proceeds of insurance thereon).
(a) Possessory Security shall mean the balance of every deposit account of
the undersigned with the Bank or any of the Bank's nominees or agents and all
other obligations of the Bank or any of its nominees or agents to the
undersigned, whether now existing or hereafter arising, and all other personal
property of the undersigned (including without limitation all money, accounts,
general intangibles, goods, instruments, documents and chattel paper) which, or
any evidence of which, are now or at any time in the future shall come into the
possession or under the control of or be in transit to the Bank or any of its
nominees or agents for any purpose, whether or not accepted for the purposes for
which it was delivered.
(b) Non-Possessory Security. Unless one or more boxes below are checked and
initialled by the Bank and the undersigned, Non-Possessory Security shall mean
all personal property of the undersigned, including without limitation all
accounts, general intangibles, goods, instruments, documents and chattel paper.
ONLY IF THE NON-POSSESSORY SECURITY IS TO BE LIMITED, SHOULD ANY OF THE BOXES
BELOW BE CHECKED AND INITIALLED. If any of boxes (i) through (iv) below are
checked and initialed by the Bank and the undersigned, the Non-Possessory
Security shall be limited to whatever is checked.
BANK UNDERSIGNED DESCRIPTION
----------------------------------------- / / (i) All Inventory and Documents
/ / (ii) All Accounts, Chattel Paper
and Instruments and all Goods
returned to or repossessed or
otherwise reacquired by the
undersigned which relate to the
foregoing.
-----------------------------------------
/ / (iii) All Equipment and Fixtures,
including without limitation the
equipment shown on the attached
schedule (if any)
----------------------------------------- / / (iv) All Property shown on any
attached schedule.
----------------------------------------- / / (v) POSSESSORY SECURITY ONLY
The undersigned represents and warrants to the Bank that (a)the location of the
undersigecd's chief executive office is as set forth below, (b) except as set
forth below, all of the Non-Possessory Security is located at the undersigned's
chief executive office, and (c) each premises where any of the Non-Possessory
Security is located is owned or leased by the undersigned.
Chief Executive Office--(strect address; county; state; zip code):
00 Xxxxxx Xxxx Xxxx
----------------------------------------
Xxxxx Xxxx, Xxx Xxxx 00000
----------------------------------------
----------------------------------------
Other promises where Security is located--(street address; county; state; zip
code):
----------------------------------------
----------------------------------------
----------------------------------------
----------------------------------------
----------------------------------------
----------------------------------------
New York, New York
March 1 .1996
-------------------------------- --
(Individuals sign below)
----------------------------------------
----------------------------------------
----------------------------------------
----------------------------------------
(Corporations or Partnerships sign below)
----------------------------------------
(Name of Corporation or Partnership)
By:-------------------------------------
----------------------------------------
(Title)
By:-------------------------------------
----------------------------------------
(Title)
By:-------------------------------------
----------------------------------------
(Title)
RIDER ATTACHED TO AND MADE A PART OF SECURITY
AGREEMENT DATED MARCH 1, 1996, BETWEEN
AND BANK LEUMI
-------------------------
TRUST COMPANY OF NEW YORK
-------------------------------------------
31. DEFINITIONS. Any initially capitalized term used in this Rider
without definition shall have the same meaning herein as in the Credit
Agreement, unless the context otherwise requires.
32. CONFLICT. In the event of any conflict between the terms of this
agreement and the Credit Agreement, the terms of the Credit Agreement shall
prevail.
33. SECURITY. The Security shall include, without limitation, all
the right, title and interest of the undersigned in and to each and every
mortgage, deed of trust, land sale contract or similar instrument ("Mortgage")
and promissory note or similar instrument or obligation ("Mortgage Note")
secured thereby which are heretofore or hereafter owned by the undersigned and
all security agreements, guaranties, insurance policies, agreements and all
other documentation delivered to the undersigned in connection with such
Mortgage and Mortgage Note (collectively, the "Mortgage Collateral").
Simultaneously with the execution of this agreement, the undersigned is
delivering and assigning to the Bank the Mortgage Collateral described on
Schedule 1 annexed hereto and made a part hereof.
34. ADDITIONAL DOCUMENTS. Concurrently with the undersigned
acquiring a Note and Mortgage, the undersigned shall collaterally assign to the
Bank all of its right, title and interest as mortgagee under the Mortgage, the
accompanying Mortgage Note secured thereby, and the other Mortgage Collateral.
In addition, the undersigned shall deliver to the Bank the following
documentation in a form acceptable to the Bank:
(a) the original Mortgage Note being assigned, signed by the
mortgagor thereunder, together with an allonge to such Mortgage
Note endorsing the same to the Bank;
(b) a recorded original signed copy of the Mortgage being assigned
or, if the Mortgage being assigned has not yet been recorded, a
copy of the executed Mortgage being assigned
in the form delivered for recording (with all documents and fees
required to record said Mortgage unless previously delivered for
recording);
(c) an original signed assignment of the Mortgage in form acceptable
for recording, with covenants, by which the undersigned's
interest in such Mortgage is assigned to the Bank (with all
documents and fees required to record said assignment);
(d) Uniform Commercial Code Financing Statements, which financing
statements shall give, when filed, the Bank a perfected security
interest in the undersigned's interest in the Mortgage Collateral
being assigned;
(e) a policy of title insurance, with respect to the Mortgage being
assigned, issued by a title insurance company reasonably
satisfactory to the Bank and containing only such exceptions to
title as are acceptable to the Bank, naming the Bank as
mortgagee, as its interest may appear, or a commitment by such
title insurance company to issue such a policy upon the recording
of the assignment of the Mortgage provided for in subparagraph
(c) hereof, along with the payment of the fee to be charged by
such title company, if any, for providing such insurance
coverage;
(f) a survey of the real property encumbered by the Mortgage (the
"Mortgaged Property") being assigned to the Bank;
(g) a fire and hazard insurance policy for the Mortgaged Property in
an amount acceptable to the Bank naming the Bank as a mortgagee,
as its interest may appear;
(h) a flood insurance policy if the Mortgaged Property encumbered by
the Mortgage being assigned is located in an area identified by
the Secretary of Housing and Urban Development as an area having
special flood hazards, naming the Bank as a mortgagee, as its
interest may appear, or a certificate from the appropriate
municipal agency, or
2
other evidence satisfactory to the Bank, stating that such
premises are not in a special flood hazard area;
(i) permanent Certificates of occupancy for the structures located on
the Mortgaged Property encumbered by the Mortgage being assigned;
(j) an estoppel certificate from the fee owner of the Mortgaged
Property encumbered by the Mortgage being assigned in a form
acceptable to the Bank;
(k) a letter of direction regarding the payments due under the
Mortgage (and Mortgage Note secured thereby) being assigned,
acknowledged by the mortgagor thereunder (the
"Mortgagor"), in the form annexed hereto as Exhibit 1 or in such
other form as the Bank may reasonably require; and
(l) such other documents as the Bank may reasonably request, in form
and substance acceptable to the Bank.
35. COVENANTS. The undersigned further warrants, covenants and
agrees as follows:
(a) The undersigned shall not modify, extend or amend any of the
terms or provisions of any Mortgage Xxxx or any Mortgage and shall not waive any
of its rights under any of the Mortgage Notes or Mortgages without obtaining the
prior written consent of the Bank in each instance;
(b) The undersigned shall perform all of the terms, covenants and
conditions on its part to be performed, if any, under the Mortgage Notes and/or
Mortgages;
(c) Within five (5) days of its receipt of knowledge thereof, the
undersigned shall notify the Bank of the occurrence of a default under any of
the Mortgage Notes and/or the Mortgages and shall take such action with respect
thereto as the Bank may direct;
(d) Within five (5) days of its receipt or delivery thereof, as the
case may be, the undersigned shall forward to the Bank copies of all notices or
demands received or sent by the undersigned under or with respect to any of the
Mortgage Notes and/or Mortgages;
3
(e) With regard to the Mortgages, the undersigned hereby authorizes
the Bank to give written notice of this assignment, at any time, to any or all
of the Mortgagors, or their successors, as the owners of the various Mortgaged
Properties. The undersigned hereby authorizes and directs each of the
Mortgagors to pay all installments of principal and/or interest due under its
respective Mortgage Note directly to the Bank upon receipt from the Bank of a
written statement that an Event of Default has occurred, accompanied by a demand
for such payment, without any further proof of the undersigned's default, and
the undersigned covenants and agrees that the Mortgagors shall not be liable to
the undersigned for any payments made to the Bank pursuant to such written
notice; and
(f) the undersigned hereby certifies to the Bank that to the best of
its knowledge no default (or any event which, with the passage of time or the
giving of notice, or both, would constitute a default) has occurred under any of
the Mortgage Notes or Mortgages.
36. REPRESENTATIONS AND WARRANTIES. The undersigned hereby
represents and warrants to the Bank as follows:
(i) The shares of common stock of each Existing Subsidiary
identified on Schedule 2 annexed hereto and made a part hereof, which constitute
part of the Security (the "Pledged Shares"), have been validly issued by such
Existing Subsidiary and are fully paid and nonassessable. The Pledged Shares
identified opposite the name of each Existing subsidiary on said Schedule
constitute all of the issued and outstanding shares of capital stock of such
Existing Subsidiary. There are no existing options, warrants or rights of any
kind to purchase or acquire shares of the capital stock of any Existing
Subsidiary.
(ii) The undersigned is the legal record and beneficial owner of,
and has good and marketable title to, the Pledged Shares, free and clear of all
liens and encumbrances of every nature (except for the liens of the Bank).
(iii)The undersigned has full power, authority and legal right to
pledge the Pledged Shares to the Bank pursuant to this agreement.
(iv) The pledge of the Pledged Shares pursuant to this agreement
creates a valid and perfected
4
first priority security interest in favor of the Bank in the Pledged Shares.
37. RIGHTS OF PARTIES.
37.1 Notwithstanding anything to the contrary contained in this
agreement, so long as an Event of Default has not occurred:
(i) The undersigned shall be entitled to exercise any and
all voting rights pertaining to the Pledged Shares or any part thereof for any
purpose not inconsistent with the terms of this agreement or the Credit
Agreement; provided that, the undersigned shall not exercise or refrain from
exercising any such voting right if, in the Bank's judgment, such action would
have a material and adverse effect on the value of the Pledged Shares or any
part thereof.
(ii) Any stock dividends on the outstanding shares of
capital stock of each Existing Subsidiary shall forthwith be delivered to the
Bank to hold as Pledged Shares hereunder (with any necessary endorsement and
stock powers) and shall, if received by the undersigned, be received in trust
for the benefit of the Bank, be segregated from the other property of the
undersigned, and be forthwith delivered to the Bank as Pledged Shares in the
same form as so received (with any necessary endorsement and stock powers).
37.2 Upon the occurrence of an Event of Default all rights of the
undersigned to exercise the voting rights which it would otherwise be entitled
to exercise pursuant to Section 37.1(i) shall cease, and all such rights shall
thereupon become vested in the Bank which shall thereupon have the sole right to
exercise such voting rights. The rights of the Bank pursuant to the provisions
of the preceding sentence shall be in addition to any other rights or remedies
the Bank may have as a result of such Event of Default.
38. MISCELLANEOUS.
38.1 The Bank shall not be responsible or liable to the
undersigned with respect to the Pledged Shares except in the case of the Bank's
gross negligence or willful misconduct, it being understood that the Bank shall
not have any responsibility for ascertaining or taking action with
5
respect to calls, conversions, exchanges, maturities, tenders or other matters
relative to any Pledged Shares.
38.2 If the Bank shall determine to exercise its right to sell
all or any of the Pledged Shares pursuant to Section 9 of this agreement, the
undersigned agrees that, upon request of the Bank, the undersigned will, at its
expense, do or cause to be done all such acts and things as may be necessary to
make such sale of the Pledged Shares or any part thereof valid and binding and
in compliance with applicable law.
6
SCHEDULE 1
[To be completed]
SCHEDULE 2
[To be completed]
EXHIBIT I
BANK LEUMI TRUST COMPANY OF NEW YORK
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
March 1, 1996
___________________
___________________
___________________
Re: Mortgage Note and Mortgage shown on Schedule 1 annexed hereto,
encumbering premises described on said Schedule 1 (COLLECTIVELY,
"MORTGAGE")
Gentlemen:
This will inform you that the Mortgage has today been collaterally assigned to
Bank Leumi Trust Company of New York (the "Bank"). A copy of such assignment is
enclosed herewith. Accordingly, you are hereby instructed as follows:
A. Effective immediately, all prepayments made by you under the Mortgage
and principal payments made upon the maturity of the Mortgage (whether stated or
by acceleration), are to be paid to the order of the Bank and sent to the Bank
at 000 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Xxxxxx Xxxxxx; and
B. Upon receipt by you of notice from the Bank that an event of default
has occurred under that certain Security Agreement dated March 1, 1996, between
the Bank and One Liberty Properties, Inc., all payments of principal and
interest due under the Mortgage not previously paid are to be sent to the order
of the Bank at the address provided for in said notice.
Very truly yours,
BANK LEUMI TRUST COMPANY OF NEW YORK
By:____________________________
Name:__________________________
Title:_________________________
The foregoing is consented and agreed to:
ONE LIBERTY PROPERTIES, INC.
By:_________________________
Name:_______________________
Title:______________________
____________________________
By:_________________________
Name:_______________________
Title:______________________
[Logo] EXHIBIT D
UNLIMITED GUARANTY
In consideration of financial accommodations given or to be given or
continued to ONE LIBERTY PROPERTIES, INC., herein called "Borrower" by BANK
LEUMI TRUST COMPANY OF NEW YORK herein called "Bank", the undersigned
irrevocably and unconditionally guarantee to the Bank, payment when due, whether
by acceleration or otherwise, of any and all liabilities of the Borrower to the
Bank, together with all interest thereon and all attorneys' fees, costs and
expenses of collection incurred by the Bank in enforcing any of such
liabilities.
The term "liabilities of the Borrower" shall include all liabilities,
direct, indirect, or contingent, joint, several or independent, of the Borrower
now or hereafter existing, due or to become due to, or held or to be held by,
the Bank for its own account or as agent for another or others, whether created
directly or acquired by assignment or otherwise.
The undersigned waive notice of acceptance of this guaranty and notice of
any liability to which it may apply, and waive presentment, demand of payment,
protest, notice of dishonor or nonpayment of any such liabilities, suit or
taking other action by the Bank against, and any other notice to, any party
liable thereon (including the undersigned).
The Bank may at any time and from time to time (whether or not after
revocation or termination of the guaranty) without the consent of, or notice to,
the undersigned, without incurring responsibility to the undersigned, without
impairing or releasing the obligations of the undersigned hereunder, upon or
without any terms or conditions and in whole or in part.
(1) change the manner, place or terms of payment, and/or exchange or
extend the time of payment of, renew or alter, any liability of the Borrower,
any security therefor, or any liability incurred directly or indirectly in
respect thereof, and the guaranty herein made shall apply to the liabilities of
the borrower as so changed, extended, renewed, or altered;
(2) sell, exchange, release, surrender, realize upon or otherwise deal
with in any manner and in any order any property by whomsoever at any time
pledged or mortgaged to secure, or however securing, the liabilities hereby
guaranteed or any liabilities (including any of those hereunder) incurred
directly or indirectly in respect thereof or hereof, and/or any offset
thereagainst.
(3) exercise or refrain from exercising any rights against the Borrower or
others (including the undersigned) or otherwise act or refrain from acting;
(4) settle or compromise any liability hereby guaranteed, any security
therefor or any liability (including any of those hereunder) incurred directly
or indirectly in respect thereof or hereof, and may subordinate the payment of
all or any part thereof to the payment of any liability (whether due or not) of
the Borrower to creditors of the borrower other than the Bank and the
undersigned; and
(5) apply any sums by whomsoever paid or howsoever realized to any
liability or liabilities of the Borrower to the Bank regardless of what
liability or liabilities of the Borrower remain unpaid.
No failure by the Bank to file, record or otherwise perfect any lien or
security interest, nor any improper filing or recording, nor any failure by the
Bank to insure or protect any security nor any other dealing (or failure to
deal) with any security by the Bank, shall impair or release the obligations of
the undersigned hereunder.
No invalidity, irregularity or unenforceability of all or any part of the
liabilities hereby guaranteed or of any security therefore shall affect, impair
or be a defense to this guaranty, and this guaranty is a primary obligation of
the undersigned.
This guaranty is a continuing one and all liabilities to which it applies
or may apply under the terms hereof shall be conclusively presumed to have ben
created in reliance hereon. As to each of the undersigned, this guaranty shall
continue until written notice of revocation signed by such undersigned, or until
written notice of the death of such undersigned (which shall be deemed a notice
of revocation hereunder) shall in each case have been actually received by the
Bank, notwithstanding a revocation by, or the death of, or complete or partial
release for any cause of, any one or more of the remainder of the undersigned,
or of the Borrower or of any one liable in any manner for the liabilities hereby
guaranteed or for the liabilities (including those hereunder) incurred directly
or indirectly in respect thereof or hereof, and notwithstanding the dissolution,
termination or increase, decrease or change in personnel of any one or more of
the undersigned which may be corporations or partnerships. Written notice as
above provided shall be the only means of revocation or termination of this
guaranty, notwithstanding the fact that for periods of time there may be no
outstanding liabilities of the Borrower. No revocation or termination hereof
shall affect in any manner the effectiveness and applicability of this guaranty,
or any rights of the Bank or the obligations of the undersigned hereunder, with
respect to (a) liabilities of the Borrower which shall have been created,
contracted, assumed or incurred prior to receipt by the Bank of written notice
of such revocation or termination, (b) all extensions, renewals or modifications
of any of the liabilities referred to in (a) above made after receipt by the
Bank of such written notice, or (c) liabilities of the Borrower which shall have
been created, contracted, assumed or incurred after receipt by the Bank of such
written notice pursuant to any contract entered into by the Bank prior to its
receipt of such notice or which are otherwise related to or connected with
liabilities of the Borrower theretofore arising or transactions theretofore
entered into.
The Bank at all times and from time to time shall have the right to require
the undersigned to deliver to the Bank as security for the liabilities of the
undersigned hereunder, collateral security, original or additional, satisfactory
to the Bank.
All property of the undersigned shall be held by the Bank subject to a lien
and as security for any and all liabilities of the undersigned. The term
"property of the undersigned" shall include all property of every description,
now or hereafter in the
Form No. 417 (R9/83)
possession or custody of or in transit to the Bank for any purpose, including a
safekeeping, collection or pledge, for account of the undersigned, or as to
which the undersigned may have any right or power. The balance of every account
of the undersigned with, and each claim of the undersigned against, the Bank
existing from time to time, shall be subject to a lien and subject to be set off
against any and all liabilities of the undersigned, and the Bank may at any time
or from time to time at its option and without notice appropriate and apply
toward the payment of any of the liabilities of the undersigned the balance of
each such account of the undersigned with, and each such claim of the
undersigned against, the Bank. The term "property of the undersigned" shall also
include any and all book-entry U.S. Treasury bills and other book-entry
securities purchased on behalf of the undersigned and maintained in an account
at the Bank, which may have a related account at a bank which is a member of the
Federal Reserve System. The undersigned authorizes the Bank to serve as its
bailee and agent with respect to the aforementioned book-entry Treasury bills
and other book-entry securities and to take such action and to execute and
deliver such documents on behalf of the undersigned as the Bank deems necessary
or desirable in order to perfect the Bank's security interest therein. The
undersigned hereby gives notice to the Bank, in the Bank's capacity as bailee
and agent, of the Banks security interest in the aforementioned book-entry
Treasury bills and other book-entry securities. The Bank may at any time and
from time to time, without notice, transfer into its own name or that of its
nominee any of the property of the undersigned.
Upon the happening of an Event of Default under the Credit Agreement, dated
even date herewith between the Borrower and the Bank, then and in any such
event, and at any time thereafter, the Bank may, without notice to the Borrower
or the undersigned, make the liabilities of the Borrower to the Bank, whether or
not then due, immediately due to and payable hereunder as the undersigned, and
the Bank shall be entitled to enforce the obligations of the undersigned
hereunder.
Upon nonpayment when due of any of the liabilities of the Borrower or the
undersigned to the Bank, the Bank may immediately or at any time or times
thereafter without demand or notice to the Borrower or the undersigned and
without advertisement, all of which are hereby expressly waived, sell, resell,
assign and deliver all or part of said "property of the undersigned" at an
Brokers' Board or Exchange, or at public or private sale, for cash, upon credit
or for future delivery, and in connection therewith may grant options. Upon each
such sale the Bank may purchase the whole or any part of such property, free
from any right of redemption, which is hereby waived and released.
In the case of each such sale, or of any proceedings to collect any
liabilities of the undersigned, the undersigned shall pay all costs and expenses
of every kind for collection, sale or delivery, including reasonable attorneys'
fees, and after deducting such costs and expenses from the proceeds of sale or
collection, the Bank may apply any residue to pay any liabilities of the
undersigned, who shall continue liable for any deficiency, with interest.
If claim is ever made upon the Bank for repayment or recovery of any amount
or amounts received by the Bank in payment or on account of any of the
liabilities of the Borrower and the Bank repays all or part of said amount by
reason of (a) any judgment, decree or order of any court or administrative body
having jurisdiction over the Bank or any of its property, or (b) any settlement
or compromise of any such claim effected by the Bank with any such claimant
(including the Borrower), then and in such event the undersigned agree that any
such judgment, decree, order, settlement or compromise shall be binding upon the
undersigned, notwithstanding any revocation hereof or the cancellation of any
note or other instrument evidencing any liability of the Borrower, and the
undersigned shall be and remain liable to the Bank hereunder for the amount so
repaid or recovered to the same extent as if such amount had never originally
been received by the Bank.
No delay on the part of the Bank in exercising any of its options, powers
or rights, or partial or single exercise thereof, shall constitute a waiver
thereof. No waiver of any of its rights hereunder, and no modifications or
amendment of this guaranty, shall be deemed to be made by the Bank unless the
same shall be in writing, duly signed on behalf of the Bank, and each such
waiver, if any, shall apply only with respect to the specific instance involved,
and shall in no way impair the rights of the Bank or the obligations of the
undersigned to the Bank in any other respect at any other time.
The term "Bank" as used throughout this instrument shall be deemed to
include the BANK LEUMI TRUST COMPANY OF NEW YORK, and all its agencies, branches
and departments wherever located.
Whenever in this instrument the words "attorneys' fees" are used, such fees
shall be computed as follows: 15% of the principal, interest and all other sums
due and owing to the Bank, or the reasonable value of the services of the
attorneys, whichever is greater. The term "Borrower" as used throughout this
instrument shall be deemed to include any (a) successor partnership or
partnerships if the Borrower is a partnership, and (b) corporation or
corporations which succeed to all or substantially all of the assets or business
of the Borrower by merger, consolidation or sale of assets if the Borrower is a
corporation.
This guaranty and the rights and obligations of the Bank and of the
undersigned hereunder shall be governed and construed in accordance with the
laws of the State of New York; and this guaranty is binding upon the
undersigned, his, their or its executors, administrators, successors, or
assigns, and shall inure to the benefit of the Bank, its successors or assigns.
The undersigned hereby irrevocably submits to the jurisdiction of any New York
State or Federal Court located in New York City over any action or proceeding
arising out of any dispute between the undersigned and the Bank, and the
undersigned further irrevocably consents to the service of any process in any
such action or proceeding by the mailing of a copy of such process to the
undersigned at the address set forth below.
The undersigned, if more than one, shall be jointly and severally
liable, hereunder, and the term "undersigned" wherever used herein shall mean
the undersigned or any one or more of them. Any one signing this guaranty shall
be bound hereby, whether or not any one else signs this guaranty at any time.
Dated: New York,New York
the day of , 19
--------------------- ----------------------- ------
(Individuals sign below) (Corporation or partnerships sign below)
------------------------------------- ----------------------------------------
(Name of Corporation or Partnership)
By:
-------------------------------------- -------------------------------------
(Address) (Title)
-------------------------------------- -------------------------------------
(Title)
-------------------------------------- -------------------------------------
(Address) (Address)
Signature(s) Guaranteed
--------------------------------------------------
(Name of Bank)
By:
----------------------------------------------
(Authorized Signature)
SCHEDULE 3.1.9
--------------
(Payments Due on Mortgage Notes)
See Attached.
SCHEDULE 3.1.9
MORTGAGE LOANS
Constant
Original 2/1/96 Interest Monthly
Instruments: Property: Balance: Balance: Rate: Payment:
----------- -------- ------- ------- ---- -------
1. Subtitute Subordinate Wrap 000 Xxxx 00xx Xx $23,000,000 [1] $20,038,509 [2] 8.0% $236,666.00 [3]
Mortgage, Security Agreement New York, NY
and Assignment of Leases and Rents
dated as of July 30,1993 by
57-115 Associates L.P to OLP
2. Mortgage dated January 4,1982 commercial condo/ $1,700,000 $845,000 11.0% Interest plus
by 000 Xxxx 00xx Xxxxxx Company pledge of mrtge on $5,000.00
to Berjac Holding Corp., as residental condo
amended, now held by OLP 000 Xxxx 00xx Xx
Xxx Xxxx, XX
3. Deed of Trust dated September 23, 0000 Xxxxx Xxxxxx $125,000 $58,889.39 10.25% $1,157.98
1976 by Xxxxxxx Xxxxxxxx Xxxxxxx, Xxxxxxx, XX
Inc. to Pioneer National Title
Insurance Company, as trustee
---------------------
1. Includes balance of underlying mortgage of $13,181,000.
2. Includes balance on underlying mortgage of $11,327,155.
3. The underlying mortgage bears interest at 9.5% with a $157,327.97 constant
monthly payment, which is included within the payment noted.
SCHEDULE 4.1
(Existing Subsidiaries)
XXX Xxxxx Drive Houston, Inc.
OLP - TSA Georgia, Inc.
OLP - Arby's II, Inc.
OLP Action, Inc.
OLP Iowa, Inc.
OLP Texas, Inc.
OLP 47th Avenue Corp.
OLP Greenwood Village Colorado, Inc.
SCHEDULE 4.12
(Existing UCC Security Interests)
SECURED DEBTOR LOCATION OF DATE OF FILING COLLATERAL
PARTY FILING FILING NO.
Bank One OLP Texas, New York August 22, 171434 All personal
Texas, N.A. Inc. Dept. of 1995 property of
State Debtor
located at
certain
property
located in
Texas
Bank One, OLP Texas, Nassau August 23, 013039 All personal
Texas, N.A. Inc. County 1995 property of
Clerk's Debtor
Office located at
certain
property
located in
Texas
The Xxxx Xxx Xxx Xxxxxxx Xxx Xxxx June 27, 131093 All
York Savings Properties, Dept. of 1994 machinery,
Bank Inc. State equipment,
fixtures
located at
119-125
Madison and
00-00 Xxxx
00xx Xxxxxx,
XX, XX
SCHEDULE 4.12
EXISTING MORTGAGES/DEEDS OF TRUST
Current Original
Property: Lender: Loan Amount:
-------- ------ -----------
000-000 Xxxxxxx Xxxxxx Xxxx Xxx Xxxx $4,250,000
New York, New York Savings Bank
0000 Xxxxx Xxxxxx, XX Firstar Bank Cedar $990,000
Cedar Rapids, Iowa Rapids, N.A.
000 X. Xxxx. Xxxxx Expressway Bank One, Texas, N.A. $731,250
Killeen, Texas
00000 XX Xxxxxxx Xxxx Xxx, Xxxxx, N.A. $692,100
Rosenberg, Texas
0000 Xxxxxxxxx Xxxxxx Xxxx Xxxxxxx Life $1,800,000
Columbus, Ohio Insurance Co.
0000 Xxxxx Xxxxxx MBL Life $1,050,000(lst)
Seattle, Washington Assurance Co.
0000 Xxxxx Xxxxxx One Liberty $125,000(2nd)
Seattle, Washington Properties, Inc.
OTHER ENCUMBRANCES:
In addition to the mortgages and deeds of trust above listed, the properties of
the Borrower and its Subsidiaries are encumbered by easements, survey
exceptions, encroachments and other minor title imperfections which do not
render title to such properties unmarketable.
SCHEDULE 4-13
(Litigation)
- None -
SCHEDULE 4.15
(Environment)
See Attached.
[Letterhead] [Logo]
November 16, 1995
Mr. Xxx Xxxxx 0100261000
One Liberty Properties, Inc.
00 Xxxxxx Xxxx Xxxx, Xxxxx 000
Xxxxx Xxxx, Xxx Xxxx 00000
Dear Xxx:
As you requested, EnecoTech Inc. (EnecoTech), has revised the 1994 Cost
Estimates to perform activities directed toward site remediation and closure at
each of the former Action Auto facilities. These costs have been developed
following an evaluation of project activities conducted to date, and based on
anticipated activities necessary to satisfy the new Risk Based Corrective Action
(RBCA) site closure requirements of the Michigan Department Environmental
Quality (MDEQ, formerly MDNR). Costs may differ as a result of changing
conditions, additional information which may be collected, and changes in MDEQ
regulations. Specifically, the MDEQ will be publishing revised Risk Based
Screening Levels (RBSL's) in January that are anticipated to be less restrictive
than current maximum contaminant levels. After the information becomes
available, we will provide an update to this cost estimate.
These estimates may be subject to change in response to MDEQ regulations and
directives or unforeseen site-specific circumstances. As always, these costs
are based on the data gathered to date, the current regulatory climate, and
remediation methods currently acceptable. Numerous factors were considered in
the development of the cost estimates; these included the technical feasibility
of the remediation alternatives, the economic feasibility of the remediation
alternatives available, the regulatory status of each site; and the
idiosyncracies of MDEQ personnel specific to each region. Costs of any
potential third party claims can not be estimated, but are not anticipated based
on the current condition sites.
A summary of the estimated costs is provided in the attached table. Under the
new RBCA regulation, EnecoTech expects site closure with no remediation
activities at stations #37 and #42. Since the date of our last cost estimate,
site closure has been achieved at stations #11 and #22. The final invoice for
#11 was issued several months ago, and you will receive the final invoice for
#22 before the end of the year(for approximately $3,000). Please contact me at
(000) 000-0000, ext. 179 if you have any questions. EnecoTech appreciates the
opportunity to be of service to you.
Sincerely,
ENECOTECH, INC.
/s/ Xxx
Xxx X. Xxxxxx
Project Geoscientist
Attachment
[Logo]
Recycled Paper
---------------------------------------------------------
NOVEMBER 16, 1995
Facility Site Status Cost Closure Date
--------------------------------------------------------------------------------
#37 Midland Limited onsite soil and $10,000 Six months
ground water impact.
Remediation not anticipated.
#39 Grand Rapids Onsite and offsite soil and $358,985 Four years
ground water impact, free
phase hydrocarbons present
onsite.
#51 St. Xxxxx Limited onsite and offsite $92,895 Two years
soil and ground water
impact.
#00 Xxxxxx Xxxxx Offsite and significant $347,755 Four Years
onsite soil and ground
water impact.
#59 Xxxxx City Limited onsite soil and $85,540 Two years
ground water impact.
#42 Flushing Limited onsite soil and $10,000 Six moths
ground water impact.
Remediation not anticipated.
#58 Bad Axe Limited soil and ground $90,000 Two years
water impact.
[Logo] [Logo]
Recycled Paper
