EXHIBIT 10.56
Indenture Agreement among Desert Ridge Resort, LLC,
as Issuer; Bank One, National Association,
as Trustee; and Financial Structures Limited,
as Insurer, relating to the Desert Ridge Property
INDENTURE
among
DESERT RIDGE
RESORT, LLC
as Issuer,
BANK ONE, NATIONAL ASSOCIATION
as Trustee,
and
FINANCIAL STRUCTURES LIMITED
as Insurer
Dated as of December 15, 2000
$70,000,000
Senior Secured Floating Rate Notes Due 2007
$109,000,000
7.90% Senior Secured Notes Due 2007
TABLE OF CONTENTS
Page
RECITALS.......................................................................1
ARTICLE I DEFINITIONS.......................1
SECTION 1.1 Definitions.............................................1
SECTION 1.2 Rules of Construction..................................14
ARTICLE II THE NOTES.......................15
SECTION 2.1 Forms of the Notes Generally...........................15
SECTION 2.2 Form of Trustee's Certificate of Authentication........17
SECTION 2.3 The Notes..............................................17
SECTION 2.4 Execution, Authentication and Delivery of the Notes....18
SECTION 2.5 Registration; Transfer and Exchange; Restrictions on
Transfer of Notes....................................18
SECTION 2.6 Mutilated, Destroyed, Lost and Stolen Notes............23
SECTION 2.7 Payment of Principal and Interest......................24
SECTION 2.8 Interest on New Notes..................................24
SECTION 2.9 Cancellation...........................................24
SECTION 2.10 Transfer Agent and Paying Agent........................24
SECTION 2.11 Rule 144A Information..................................24
SECTION 2.12 Provision of Payment Date Statements and Other
Information to Holders...............................25
SECTION 2.13 Provision of Financial Information of Insurer.........26
ARTICLE III COVENANTS......................27
SECTION 3.1 Payment of Principal and Interest; Appointment of
Agents...............................................27
SECTION 3.2 Performance of Obligations.............................27
SECTION 3.3 Further Instruments and Acts...........................27
SECTION 3.4 Notice of Events of Default............................28
SECTION 3.5 Maintenance of Books and Records.......................28
SECTION 3.6 Continuation of Ratings................................28
ARTICLE IV REMEDIES........................28
SECTION 4.1 Notices of Default.....................................28
SECTION 4.2 Exercise of Remedies...................................28
SECTION 4.3 Limitation of Suits....................................29
SECTION 4.4 Unconditional Rights of Noteholders To Receive
Principal, Interest and Additional Amounts...........29
SECTION 4.5 Performance and Enforcement of Certain Obligations.....30
SECTION 4.6 Special Construction Servicer..........................30
ARTICLE V THE TRUSTEE......................31
SECTION 5.1 Duties of the Trustee..................................31
SECTION 5.2 Rights of Trustee......................................33
SECTION 5.3 Individual Rights of Trustee...........................34
SECTION 5.4 Trustee's Disclaimer...................................34
SECTION 5.5 Notice of Defaults; Notice of Requirement to Pay
Additional Amounts...................................34
SECTION 5.6 Appointment of Administrative Agent....................35
SECTION 5.7 Compensation and Indemnity.............................36
SECTION 5.8 Replacement of Trustee.................................37
SECTION 5.9 Successor Trustee by Merger............................38
SECTION 5.10 Eligibility; Disqualification..........................38
SECTION 5.11 Unclaimed Funds........................................39
ARTICLE VI NOTEHOLDERS' LISTS, REPORTS
AND MEETINGS..............................39
SECTION 6.1 Preservation of Information; Communications to
Noteholders..........................................39
SECTION 6.2 Voting by Noteholders..................................39
SECTION 6.3 Purposes for Which Noteholder Meetings May Be Called...39
SECTION 6.4 Call, Notice and Place of Meetings.....................40
SECTION 6.5 Persons Entitled to Vote at Meetings...................40
SECTION 6.6 Quorum; Action.........................................40
SECTION 6.7 Determination of Voting Rights; Conduct and
Adjournment of Meetings..............................41
SECTION 6.8 Counting Votes and Recording Action of Meetings........42
ARTICLE VII ACCOUNTS, COLLECTIONS AND
DISBURSEMENTS.............................43
SECTION 7.1 Collection and Disbursements of Money..................43
SECTION 7.2 The Accounts...........................................45
SECTION 7.3 General Provisions Regarding Accounts..................45
SECTION 7.4 Payment of Accounts Balances...........................46
ARTICLE VIII SUPPLEMENTAL INDENTURES.......46
SECTION 8.1 Supplemental Indentures Without Consent of Noteholders.46
SECTION 8.2 Supplemental Indentures with Consent of Noteholders....47
SECTION 8.3 Execution of Supplemental Indentures...................48
SECTION 8.4 Effect of Supplemental Indenture.......................48
SECTION 8.5 Reference in Notes to Supplemental Indentures..........49
ARTICLE IX REDEMPTION OF NOTES; PURCHASE
OF NOTES; DEFEASANCE......................49
SECTION 9.1 Redemption.............................................49
SECTION 9.2 Purchase...............................................49
SECTION 9.3 Mechanics of Redemption or Purchase....................50
SECTION 9.4 Form of Redemption Notice or Purchase Notice...........52
SECTION 9.5 Notes Payable on Payoff Date...........................52
SECTION 9.6 Defeasance.............................................52
SECTION 9.7 Release of Collateral..................................53
ARTICLE X OBLIGATIONS ABSOLUTE.............53
SECTION 10.1 Issuer's Obligations Absolute..........................53
ARTICLE XI THE INSURER.....................53
SECTION 11.1 Effect of Payment by Insurer; Subrogation.............53
SECTION 11.2 Rights of the Insurer.................................54
SECTION 11.3 Indemnification; Reimbursement of Costs...............55
SECTION 11.4 Liability of the Insurer..............................56
SECTION 11.5 Consents..............................................56
SECTION 11.6 Substitution of Reinsurer.............................56
SECTION 11.7 Notice of Failure to Pay Premiums.....................56
ARTICLE XII MISCELLANEOUS..................56
SECTION 12.1 Compliance Certificates and Opinions, etc.............56
SECTION 12.2 Form of Documents Delivered to Trustee................57
SECTION 12.3 Acts of Noteholders...................................58
SECTION 12.4 Notices, etc., to the Trustee, the Issuer, the
Insurer, the Guarantor and the Rating Agencies.......59
SECTION 12.5 Notices to and from Noteholders; Waiver...............62
SECTION 12.6 Payment and Notice Dates..............................63
SECTION 12.7 Alternative Payment and Notice Provisions.............63
SECTION 12.8 Effect of Headings and Table of Contents..............63
SECTION 12.9 Successors and Assigns................................63
SECTION 12.10 Separability..........................................63
SECTION 12.11 Benefits of Indenture.................................63
SECTION 12.12 Legal Holiday.........................................63
SECTION 12.13 Governing Law.........................................64
SECTION 12.14 Counterparts..........................................64
SECTION 12.15 Recording of Indenture................................64
SECTION 12.16 Corporate Obligation..................................64
SECTION 12.17 Inspection............................................64
SECTION 12.18 Waiver of Immunities..................................65
SECTION 12.19 Satisfaction and Discharge............................65
EXHIBIT A-1 FORM OF REGULATION S GLOBAL FLOATING RATE NOTE DUE 2007.......A-1-1
EXHIBIT A-2 FORM OF RESTRICTED GLOBAL FLOATING RATE NOTE DUE 2007.........A-2-1
EXHIBIT B-1 FORM OF REGULATION S GLOBAL FIXED RATE NOTE...................B-1-1
EXHIBIT B-2 FORM OF RESTRICTED GLOBAL FIXED RATE NOTE.....................B-2-1
EXHIBIT C FORM OF SECURITIES LEGEND.........................................C-1
EXHIBIT DFORM OF REGULATION S CERTIFICATE...................................D-1
EXHIBIT EFORM OF RULE 144A EXCHANGE CERTIFICATE.............................E-1
EXHIBIT F
Opinions of Arent Fox, Xxxxxx Xxxx, and Skadden, Arps, Slate,
Xxxxxxx & Xxxx LLP........................................................F-1
EXHIBIT GFORM OF CLEARING SYSTEM CERTIFICATE................................G-1
EXHIBIT HFORM OF INFORMATION REQUEST........................................H-1
INDENTURE
INDENTURE, dated as of December 15, 2000 (as amended, supplemented or
otherwise modified and in effect from time to time, this "Indenture"), among
DESERT RIDGE RESORT, LLC, a limited liability company organized under the laws
of the State of Delaware (together with any successor thereto (the "Issuer");
BANK ONE, NATIONAL ASSOCIATION, a national banking association, as trustee and
not in its individual capacity (in such capacity and, together with any
successor thereto as trustee hereunder, the "Trustee"); and FINANCIAL STRUCTURES
LIMITED, a company organized under the laws of Bermuda (the "Insurer").
RECITALS
The Issuer has duly authorized the execution and delivery of this
Indenture to provide for the issuance and delivery of the Notes (as defined
herein).
Each party agrees as follows for the benefit of the other party and for
the equal and ratable benefit of the Noteholders (as defined herein) of (i) the
Issuer's Senior Secured Floating Rate Notes Due 2007 (the "Floating Rate Notes")
and (ii) the Issuer's 7.90% Senior Secured Notes Due 2007 (the "Fixed Rate
Notes" and together with the Floating Rate Notes, the "Notes"):
ARTICLE I
DEFINITIONS
SECTION 1.1 Definitions. Except as otherwise specified herein or as the
context may otherwise require, the following terms have the respective meanings
specified below for all purposes of this Indenture. Other capitalized terms used
herein without definition have the meanings given to them in the Construction
Loan Agreement.
"Accounts" shall mean, collectively, the Guarantee Payment Account, the
Note Purchase Account, the Payment Account and the Policy Payment Account.
"Act" shall have the meaning specified in Section 12.3(a).
"Additional Amounts" shall have the meaning specified in the
Construction Loan Agreement.
"Additional Premium" shall have the meaning specified in the Policy.
"Affiliate" shall mean, with respect to any specified Person, any other
Person controlling or controlled by or under common control with such specified
Person. For the purposes of this definition, "control" when used with respect to
any Person shall mean the power to direct the management and policies of such
Person, directly or indirectly, whether through the ownership of voting
securities, by contract or otherwise; and the terms "controlling" and
"controlled" shall have meanings correlative to the foregoing.
"Agents" shall have the meaning specified in Section 3.1(b).
"Applicable Procedures" shall mean the rules and procedures of DTC,
Euroclear or Clearstream, in each case to the extent applicable and as in effect
from time to time.
"Assignment of Reinsurance" shall mean the Assignment of Reinsurance of
even date herewith between the Insurer and the Trustee for the benefit of the
Noteholders, a copy of which is attached as Exhibit N.
"Assignment of Reinsurance (Swap)" shall mean the Assignment of
Reinsurance of even date herewith between the Insurer and Xxxxxxx Xxxxx Capital
Services, Inc., a copy of which is attached as Exhibit O.
"Authenticating Agent" shall mean the Trustee.
"Authorized Officer" with respect to the Issuer, shall mean any
officer, or Person performing the same or a similar function, of a member of the
Issuer who is authorized to act for or on behalf of the Issuer in matters
relating to the Issuer and who is identified on the list of Authorized Officers
delivered by the Issuer to the Trustee on the Closing Date (as such list may be
modified or supplemented from time to time thereafter). With respect to the
Trustee, any Agent or the DTC Custodian, "Authorized Officer" shall mean a Trust
Officer. With respect to the Insurer, "Authorized Officer" shall mean any
officer, employee or agent of the Insurer who is authorized to act for the
Insurer in matters relating to, and binding upon, the Insurer. Each party may
receive and accept a certification of the authority of any other party as
conclusive evidence of the authority of any person to act, and such
certification may be considered as in full force and effect until receipt by
such other party of written notice to the contrary.
"Basic Documents" shall mean this Indenture, the Policy, the
Reinsurance Agreement, the Assignment of Reinsurance, and the other documents
and certificates delivered in connection therewith, as the same may from time to
time be amended, supplemented or otherwise modified and in effect.
"Beneficial Owner" shall mean each Person having a beneficial interest
in a Global Note.
"Business Day" shall mean any day, other than a Saturday or a Sunday,
on which commercial banks in New York City or the jurisdiction where the
Corporate Trust Office is located are not required or authorized by law,
executive order or regulation to close and on which such commercial banks are
open for business.
"Cash" shall mean such coin or currency of the United States of America
as at the time shall be legal tender for payment of all public and private
debts.
"Cede" shall mean Cede & Co., as DTC's nominee.
"Certificate of Authentication" shall have the meaning specified in
Section 2.2.
"Clearance System" shall mean either Clearstream or Euroclear or both,
as the context requires.
"Clearance System Certificate" shall mean a certificate in
substantially the form of Exhibit G hereto or such other form of certificate as
shall be satisfactory to the Note Registrar, Euroclear and Clearstream.
"Clearstream" shall mean Clearstream Banking, societe anonyme or any
successor securities clearing agency.
"Closing Date" shall mean December 21, 2000.
"Code" shall mean the Internal Revenue Code of 1986, as amended.
"Construction Loan Agreement" shall mean the Construction Loan
Agreement of even date herewith among the Issuer, DRR Tenant Corporation as
Operating Tenant, the Trustee and Administrative Agent.
"Construction Loan Proceeds Account" shall have the meaning specified
in the Construction Loan Agreement.
"Corporate Trust Office" shall mean the principal office of the Trustee
at which at any particular time its corporate trust business shall be
administered, which office at the date of execution of this Indenture is located
at 0 Xxxx Xxx Xxxxx, Xxxxx XX0-0000, Xxxxxxx, XX 00000-0000, Attention: Global
Corporate Trust Services, or at such other address within the United States as
the Trustee may designate from time to time by notice to the Noteholders, the
Insurer and the Issuer, or the principal corporate trust office of any successor
Trustee at the address designated by such successor Trustee by notice to the
Noteholders, the Insurer and the Issuer.
"Default" shall mean any occurrence or circumstance that is, or with
notice or the lapse of time or both would become, an Event of Default.
"Default Payment" shall mean any money collected by or paid to the
Trustee by any Person after the occurrence and during the continuance of an
Event of Default, including the proceeds collected by the Trustee upon the sale
or other disposition of Collateral or upon the exercise of any remedies under
the Construction Loan Documents.
"Default Payment Date" shall mean the first Business Day on which funds
in an Account resulting from a deposit therein by the Trustee of a Default
Payment are available to be disbursed as immediately available funds.
"Default Rate" shall have the meaning specified in the Construction
Loan Agreement.
"Defeasance Collateral" shall have the meaning specified in Section
8.6(b) of the Construction Loan Agreement.
"Defeasance Redemption Date" shall have the meaning specified in
Section 9.1(b).
"Depository" shall mean, with respect to any Global Note, DTC or such
other Person as shall be designated as Depository by the Issuer pursuant hereto.
"Depository Institution" shall mean any depository institution or trust
company incorporated under the laws of the United States or any state thereof
and subject to supervision and examination by federal or state banking
authorities.
"DTC" shall mean The Depository Trust Company, a New York corporation.
"DTC Custodian" shall mean Bank One, National Association, as custodian
of the Global Notes for the Depository under a custody agreement or any similar
successor agreement.
"Eligible Account" shall mean an account that is either: (a) maintained
with an Eligible Institution or (b) a trust account maintained with the
corporate trust department of a Depository Institution with corporate trust
powers acting in its fiduciary capacity and which is subject to regulations or
has established internal guidelines regarding fiduciary funds on deposit
substantially similar to 12 CFR 9.10(b). Each Eligible Account shall (i) be a
separate, identifiable and segregated account from all other funds held by the
Depository Institution holding such Eligible Account, (ii) be established and
maintained in the name of, or on behalf of, the Trustee, and clearly indicate
that the funds deposited therein are held for the benefit of the Noteholders and
the Issuer, (iii) provide that the Trustee possess all right, title and interest
in all funds on deposit therein from time to time and all proceeds thereof, (iv)
provide that it is under the sole dominion and control of the Trustee, on behalf
of the Noteholders and the Issuer, and (v) be an account as to which the holder
thereof has agreed that it has no right of setoff or banker's lien against, and
no right to otherwise deduct from any funds in such account for any amount owed
to such holder by the Noteholder or the Issuer. Notwithstanding the foregoing,
an Eligible Account shall also include such other accounts having such other
characteristics as are reasonably acceptable to the Trustee and the Issuer so
long as the deposit of funds hereunder in such other accounts would not result,
in and of itself, in the withdrawal, qualification or reduction of the then
current ratings of the Rating Agencies assigned to the Notes, as confirmed in
writing by the Rating Agencies.
"Eligible Institution" shall mean any Depository Institution the
short-term unsecured deposit or debt obligations of which (or, in the case of a
Depository Institution that is the principal subsidiary of a holding company,
the short-term unsecured debt obligations of such holding company) are rated at
least "P-1" by Moody's and "A-1" by S&P; provided that, if any funds are to be
held in an Eligible Account for more than 30 calendar days, an Eligible
Institution shall mean a Depository Institution the long-term unsecured debt
obligations of which (or, in the case of a Depository Institution or trust
company that is the principal subsidiary of a holding company, the long-term
unsecured debt obligations of such holding company) are rated at least "Aa3" by
Moody's and "AA-" by S&P. Notwithstanding the foregoing, an "Eligible
Institution" shall also include such other Depository Institutions having such
other characteristics as are reasonably acceptable to the Trustee so long as the
deposit of funds hereunder in such other Depository Institutions would not
result, in and of itself, in the withdrawal, qualification or downgrading of the
then current ratings of the Rating Agencies assigned to the Notes, as confirmed
in writing by the Rating Agencies.
"Euroclear" shall mean Xxxxxx Guaranty Trust Company, Brussels Office,
as operator of the Euroclear System, or any successor securities clearing
agency.
"Event of Default" shall have the meaning specified in the Construction
Loan Agreement.
"Fixed Rate Notes" shall have the meaning specified in the preamble of
this Indenture.
"Floating Rate Notes" shall have the meaning specified in the preamble
of this Indenture.
"Four-Year Date" shall mean December 15, 2004.
"Global Note" shall mean a Regulation S Global Note or a Restricted
Global Note, as the case may be.
"Guarantee Payment Account" shall mean the Eligible Account established
by the Trustee for the benefit of the Noteholders and the Insurer pursuant to
Section 7.2 for payments made with respect to the Notes by the Guarantor and all
monies, securities, instruments, documents and other property on deposit
therein.
"Indenture" shall have the meaning specified in the preamble of this
Indenture and shall include the terms of the Notes.
"Independent" shall mean, when used with respect to any specified
Person, that such Person (a) is in fact independent of the Issuer and any
Affiliate of the Issuer, (b) does not have any direct financial interest or any
material indirect financial interest in the Issuer or any Affiliate of the
Issuer and (c) is not connected with the Issuer or any Affiliate of the Issuer
as an officer, employee, promoter, underwriter, trustee, partner, director or
person performing similar functions.
"Independent Certificate" shall mean a certificate or opinion to be
delivered to the Trustee under the circumstances described in, and otherwise
complying with, the applicable requirements of Section 12.1, made by an
Independent appraiser or other expert appointed by an Issuer Order, and such
opinion or certificate shall state that the signator has read the definition of
"Independent" in this Indenture and that the signator is Independent within the
meaning thereof.
"Individual Note" shall mean a Floating Rate Note or a Fixed Rate Note
issued in definitive, certificated, fully registered form without interest
coupons and substantially in the form attached hereto as Exhibit A-3 or B-3,
respectively.
"Information Request" shall mean an information request in the form of
Exhibit H hereto, which Information Request, if delivered by a Beneficial Owner
of a Global Note, shall include a certification as to such owner's beneficial
ownership.
"Insurer" shall have the meaning specified in the preamble of this
Indenture.
"Interest Payment Date" shall have the meaning specified in the
Construction Loan Agreement.
"Interest Period" shall have the meaning specified in the Construction
Loan Agreement.
"Issuer" shall have the meaning specified in the preamble of this
Indenture.
"Issuer Order" and "Issuer Request" shall mean a written order or
request signed in the name of the Issuer by any one of its Authorized Officers
and delivered to the Trustee at least one (1) Business Day (or such longer
period as the Trustee may reasonably request) prior to the date of the requested
action specified therein.
"Legended Individual Note" shall mean an Individual Note bearing the
Securities Legend which shall initially be all Individual Notes.
"Lien" shall mean any assignment for security, charge, mortgage,
pledge, security interest, conditional sale or other title retention agreement
or similar lien.
"Make Whole Amount" shall have the meaning specified in the
Construction Loan Agreement.
"Make Whole Hedge" shall have the meaning specified in Section 9.6(b).
"Marriott" shall mean Marriott International, Inc. and its successors.
"Moody's" shall mean Xxxxx'x Investors Service, Inc. or any successor
thereto.
"New Note" has the meaning specified in Section 2.8.
"Noteholder" or "Holder" shall mean the Person in whose name a Note is
registered in the Note Register.
"Note Purchase Account" shall mean the Eligible Account established by
the Trustee for the benefit of the Noteholders pursuant to Section 7.2 for
payments made with respect to the purchase of the Notes by a Purchaser and all
monies, securities, instruments, documents and other property or deposit
therein.
"Note Register" has the meaning specified in Section 2.5.
"Note Registrar" shall mean the Trustee.
"Notes" shall have the meaning specified in the preamble of this
Indenture.
"Notice of Claim" shall have the meaning specified in the Policy.
"Officer's Certificate" shall mean a certificate signed by any
Authorized Officer of the Issuer, under the circumstances described in, and
otherwise complying with, the applicable requirements of Section 12.1, and
delivered to the Trustee and the Insurer. Unless otherwise specified, any
reference in this Indenture to an Officer's Certificate shall be to an Officer's
Certificate of any Authorized Officer of the Issuer.
"Opinion of Counsel" shall mean one or more written opinions of counsel
who may, except as otherwise expressly provided in this Indenture, be counsel to
the Issuer (and, if expressly provided herein, may be an employee of the Issuer)
and which opinion or opinions shall be addressed to the Trustee in its capacity
as such, and shall comply with any applicable requirements of Section 12.1.
"Opening Date" shall have the meaning specified in the Hotel Management
Agreement.
"Original Principal Amount" shall mean (i) with respect to the Notes,
$179,000,000, (ii) with respect to the Floating Rate Notes, $70,000,000 and
(iii) with respect to the Fixed Rate Notes, $109,000,000.
"Outstanding Principal Amount" shall mean the Original Principal Amount
of the Notes reduced from time to time by the amount of any payment (including
prepayment) of the Original Principal Amount made by the Issuer in accordance
with the terms of the Notes; provided, however, that the Outstanding Principal
Amount for any Note shall not be less than zero.
"Paying Agent" shall mean the Trustee.
"Payment Date" shall mean an Interest Payment Date, a Payoff Date, the
Stated Maturity Date or a Default Payment Date.
"Payment Date Statement" shall have the meaning specified in Section
2.12.
"Payoff Date" shall mean the date on which all of the Notes are
required to be redeemed or purchased, as the case may be, following the delivery
of a Redemption Notice or a Purchase Notice, as the case may be.
"Payment Account" shall mean the Eligible Account established by the
Trustee for the benefit of the Noteholders and the Insurer pursuant to Section
7.2 for payments made with respect to the Notes by the Issuer and all monies,
securities, instruments, documents and other property on deposit therein.
"Permitted Investments" shall mean at any time, any one or more of the
following obligations and securities, including those issued by, or entered into
with, the Trustee as long as the rating level described in the applicable
sub-paragraph, if any, is complied with:
(a) direct debt obligations of, and debt obligations fully
guaranteed as to timely payment of principal and interest by, the
United States, or any agency or instrumentality thereof, provided such
obligations are backed by the full faith and credit of the United
States;
(b) direct debt obligations of, and debt obligations fully
guaranteed as to timely payment of principal and interest by
government-sponsored corporations and agencies of the United States,
whether or not backed by the full faith and credit of the United
States, including, without limitation, debt obligations of Federal Home
Mortgage Corporation, Federal National Mortgage Association, Student
Mortgage Loan Marketing Association, Financing Corp. (FICO), Resolution
Funding Corp. (REFCORP), Consolidated Systemwide Bonds and notes of the
Farm Credit System and Consolidated Debt Obligations of the Federal
Home Mortgage Loan Banks;
(c) commercial paper of a depository institution or other
corporation organized under the law of the United States or any state
thereof which commercial paper is rated at the time of purchase at
least "A1" by Standard & Poor's and "P1" by Moody's;
(d) unsecured certificates of deposit, time deposits, federal
funds or bankers' acceptances issued by any Depository Institution;
provided that the short-term unsecured debt obligations of such
Depository Institution (or in the case of the principal Depository
Institution in a holding company system, the short-term unsecured debt
obligations of such holding company) is rated at the time of purchase
at least "A1" by Standard & Poor's and "P1" by Moody's;
(e) demand and time deposits of any Depository Institution
which deposits are fully insured by the Federal Deposit Insurance
Corporation;
(f) repurchase obligations with respect to any security
described in clauses (a) and (b) of this definition and entered into
with a Depository Institution (acting as principal) described in clause
(d) above;
(g) debt obligations (other than stripped bonds or stripped
coupons) bearing interest or sold at a discount and issued by any
corporation incorporated under the laws of the United States or any
state thereof which is rated at the time of purchase in at least the
second highest generic long-term unsecured debt rating category of each
of the Rating Agencies;
(h) money market funds rated at the time of purchase in at
least the second highest money market rating category of each of the
Rating Agencies;
(i) principal-only strips and interest-only strips in respect
of non-callable obligations issued by the United States Treasury;
(j) Resolution Funding Corp. (REFCORP) securities stripped by
the Federal Reserve Bank of New York; and
(k) any other instrument or security acceptable to the Rating
Agencies as evidenced by a letter delivered to the Trustee from each
such Rating Agency to the effect that the rating assigned to the Notes
by such Rating Agency would not be downgraded, qualified or withdrawn
if such instrument or security were included in the definition of
"Permitted Investment."
Unless otherwise specified herein, (i) any such Permitted Investment
must be available for withdrawal without penalty and must mature no later than
the Business Day immediately preceding the next Interest Payment Date; (ii) no
such instrument shall have a remaining term to maturity in excess of 365 days;
(iii) no such instrument specified above (other than the instruments described
in clauses (i) and (j) of this definition) shall constitute a Permitted
Investment if such instrument evidences a right to receive only interest
payments with respect to the obligations underlying such instrument; (iv) such
instrument (other than interest-only strips described in clauses (i) and (j) of
this definition) shall provide for a predetermined fixed dollar payment of
principal that cannot vary or change; and (v) no such instrument shall
constitute a "mortgage-backed" security.
"Person" shall mean any individual, corporation, estate, partnership,
joint venture, association, joint stock company, limited liability company,
trust (including any beneficiary thereof), unincorporated organization, or
government or any agency or political subdivision thereof.
"Policy" shall mean the Debt Service Insurance Policy of even date
herewith issued by the Insurer to the Trustee for the benefit of the
Noteholders, a copy of which is attached as Exhibit L, including any novation
and assumption of liability by the Reinsurer thereunder, as provided for in the
Assumption of Liability and Novation Endorsement to the Reinsurance Agreement.
"Policy Event" shall mean the occurrence and continuation of any one of
the following events:
(1) the Trustee shall have delivered a valid Notice of Claim to
the Insurer and the Reinsurer, the Insurer and/or the
Reinsurer shall have failed to make all required payments then
due under the Policy and such failure has not been cured in
all respects; or
(2) the Insurer or the Reinsurer shall be the subject of a
bankruptcy, insolvency or similar proceeding and such
proceeding shall not have been dismissed.
"Policy Payment Account" shall mean the segregated trust account
established by the Trustee for the benefit of the Noteholders pursuant to
Section 7.2 for payments made with respect to the Notes by or for the account of
the Insurer or the Reinsurer (other than payments made as a Purchaser) and all
monies, securities, instruments, documents and other property on deposit
therein.
"Pool Members" shall mean the member companies, from time to time, of
the Royal Indemnity Pool, which are, as of the date hereof, the Reinsurer, Globe
Indemnity Company, American & Foreign Insurance Company, Safeguard Insurance
Company, and Royal Insurance Company of America.
"Predecessor Note" of any particular Note shall mean every previous
Note evidencing all or a portion of the same indebtedness as that evidenced by
such particular Note.
"Prepayment Date" shall have the meaning specified in Section 9.1(a).
"Principal Amount" shall mean the Original Principal Amount or
Outstanding Principal Amount of the Notes, as the case may be, payable upon
maturity or redemption in respect of the principal thereof in accordance with
the terms of this Indenture.
"Priority of Payments" shall have the meaning specified in Section
7.1(b).
"Proceeding" shall mean any suit in equity, action at law or other
judicial or administrative proceeding.
"Purchase Notice" shall have the meaning specified in Section 9.2(a).
"Purchaser" shall have the meaning specified in Section 9.2(a).
"QIB" shall mean a qualified institutional buyer within the meaning of
Rule 144A.
"Rating Agencies" shall mean Moody's and S&P.
"Rating Agency Condition" shall mean, with respect to any action, that
the Rating Agencies shall have been given prior notice thereof and that the
Rating Agencies shall have notified the Trustee, the Issuer and the Insurer that
such action shall not result in a reduction, qualification or withdrawal of the
then-current rating assigned to the Notes.
"Record Date" shall mean, with respect to any Interest Payment Date,
the Stated Maturity Date, Payoff Date or Default Payment Date as applicable, the
close of business on the date (whether or not a Business Day) ten (10) calendar
days preceding such date.
"Redemption/Purchase Deposit Amount" shall mean, as of any date, an
amount equal to the sum of the following as of such date: (i) the Outstanding
Principal Amount of the Floating Rate Notes and the Make Whole Amount of the
Fixed Rate Notes, if applicable, (ii) accrued and unpaid interest on the Notes
to the date of deposit of the Redemption/Purchase Deposit Amount with the
Trustee and (x) with respect to the Floating Rate Notes, interest which will
accrue from such date of deposit through the scheduled Redemption Date at the
fixed rate provided for in the Interest Rate Swap Agreement and (y) with respect
to the Fixed Rate Notes, interest which will accrue from such date of deposit
until the scheduled Redemption Date at the rate provided for under the Fixed
Rate Notes, (iii) any unpaid Additional Amounts, (iv) any other amounts due or
to become due through the Redemption Date pursuant to this Indenture and unpaid,
(v) accrued and unpaid interest at the Default Rate and due and unpaid Late
Payment Fees, (vi) all amounts paid to the Trustee pursuant to the Policy and
not previously reimbursed, and (vii) the amount of any Additional Premium then
due or to become due on or prior to the Redemption Date to the Insurer pursuant
to the Policy; provided, however, if the Notes are being redeemed in part on
such date, the Redemption/Purchase Deposit Amount shall equal the sum of (A) the
aggregate Outstanding Principal Amount of the Floating Rate Notes to be redeemed
or the Make Whole Amount of the Fixed Rate Notes to be redeemed, (B) accrued and
unpaid interest on the amount of clause (A) through such date and (x) with
respect to the Floating Rate Notes, interest which will accrue from such date of
deposit through the scheduled Redemption Date at the fixed rate provided for in
the Interest Rate Swap Agreement and (y) with respect to the Fixed Rate Notes,
interest which will accrue from such date of deposit until the scheduled
Redemption Date at the rate provided for under the Fixed Rate Notes, (C) any
Additional Amounts due with respect to the amount being paid in connection with
such redemption and (D) Additional Premiums due or to become due on or prior to
the Redemption Date as provided in the Policy.
"Redemption Date" shall mean either a Prepayment Date or a Defeasance
Redemption Date.
"Redemption Notice" shall mean the notice of prepayment given by the
Issuer to the Trustee pursuant to the Construction Loan Agreement.
"Registered Owners" has the meaning specified in Section 2.7(b).
"Regulation S" shall mean Regulation S under the Securities Act.
"Regulation S Certificate" shall mean a certificate substantially in
the form of Exhibit D hereto.
"Regulation S Global Note" shall mean a Floating Rate Note or a Fixed
Rate Note initially sold in an offshore transaction in reliance on Regulation S
under the Securities Act and represented by one or more Global Notes in
definitive, fully registered form without interest coupons, deposited with the
DTC Custodian or any successor, and substantially in the form of Exhibit A-2 or
B-2, respectively.
"Reinsurance Agreement" shall mean the Quota Share Reinsurance
Agreement including the Assumption of Liability and Novation Endorsement thereto
of even date herewith issued by the Reinsurer, a copy of which is attached as
Exhibit M.
"Reinsurer" shall mean Royal Indemnity Company, a Delaware corporation,
and its successors as reinsurer under the Reinsurance Agreement.
"Restricted Global Note" shall mean a Floating Rate Note or a Fixed
Rate Note initially sold within the United States to U.S. Persons that are QIBs
issued in definitive, fully registered form without interest coupons, and
represented by one or more Restricted Global Notes, deposited with the DTC
Custodian or any successor, and substantially in the form of Exhibit A-1 or B-1,
respectively.
"Restricted Period" shall mean the period of forty (40) calendar days
commencing on the day after the latest of (i) the day on which the Notes are
first offered to Persons other than distributors (as defined in Regulation S
under the Securities Act) in reliance on Regulation S under the Securities Act
and (ii) the Closing Date.
"Rule 144A" shall mean Rule 144A under the Securities Act.
"Rule 144A Exchange Certificate" shall mean a certificate substantially
in the form of Exhibit E hereto.
"Rule 144A Information" shall mean such information as is specified
pursuant to Rule 144A(d)(4) under the United States Securities Act (or any
successor provision thereto) (which, at the date of this Indenture, consists of
(x) a very brief statement of the nature of the business, products and services
(which statement shall be as of a date within 12 months prior to the date of the
intended resale) of the Issuer and (y) the most recent financial statements for
such period of time during the two fiscal years preceding the period covered in
the most recent financial statements that the Issuer has been in operation. Such
financial statements shall include a balance sheet (as of a date less than 16
months before the date of the intended transaction for which such information is
required to be made available) and profit and loss and retained earnings
statements (provided that if the balance sheet is not as of a date less than 6
months before the date of the intended transaction, such most recent profit and
loss and retained earnings statements shall be for the period from the date of
such balance sheet to a date less than 6 months before the date of the intended
transaction) and shall be audited to the extent reasonably available.
"S&P" shall mean Standard & Poor's Ratings Services, a division of The
XxXxxx-Xxxx Companies, Inc. or any successor thereto.
"Securities Act" shall mean the United States Securities Act of 1933,
as amended.
"Securities Legend" shall mean the legend set forth in Exhibit C
hereto.
"Special Construction Servicer" shall have the meaning specified in
Section 4.6.
"State" shall mean any of the fifty states of the United States of
America or the District of Columbia.
"Stated Maturity Date" shall mean December 15, 2007.
"Swap Policy" shall mean the Debt Service Insurance Policy dated
December 14, 2000 issued by the Insurer to Xxxxxxx Xxxxx Capital Services, Inc.,
a copy of which is attached as Exhibit L, including any novation and assumption
of liability by the Reinsurer, as provided in the Assumption of Liability and
Novation Endorsement (Swap) to the Swap Reinsurance Agreement.
"Swap Reinsurance Agreement" shall mean the Quota Share Reinsurance
Agreement including the Assumption of Liability and Novation Endorsement (Swap)
thereto dated December 14, 2000 issued by the Reinsurer, a copy of which is
attached hereto as Exhibit M.
"Transfer Agent" shall mean the Trustee.
"Trustee" shall have the meaning specified in the preamble of this
Indenture.
"Trust Officer" shall mean when used with respect to the Trustee, any
officer within the Corporate Trust Office (or any successor group of the
Trustee) including any officer of the Trustee customarily performing functions
similar to those performed by the persons who at the time shall be such
officers, respectively, or any other officers to whom any corporate trust matter
is referred because of his or her knowledge of and familiarity with the
particular subject.
"Two-Year Date" shall mean December 15, 2002.
"United States" or "U.S." shall mean the United States of America and
any State, Puerto Rico, Guam, American Samoa, the U.S. Virgin Islands and other
territories or possessions of the United States of America.
"Unlegended Individual Note" shall mean an Individual Note which does
not bear the Securities Legend and which can only be issued if the Issuer
determines under applicable law that the placement of the Securities Legend is
no longer required.
SECTION 1.2 Rules of Construction. Unless the context otherwise
requires:
(1) a term has the meaning assigned to it;
(2) an accounting term not otherwise defined has the meaning
assigned to it in accordance with United States generally accepted accounting
principles as in effect from time to time;
(3) "or" is not exclusive;
(4) "including" means including without limitation;
(5) words in the singular include the plural and words in the
plural include the singular;
(6) all references to "$" are to U.S. dollars, unless
otherwise stated;
(7) any agreement, instrument or statute defined or referred
to herein or in any instrument or certificate delivered in connection herewith
means such agreement, instrument or statute as from time to time amended,
modified or supplemented and includes (in the case of agreements or instruments)
references to all attachments thereto and instruments incorporated therein;
references to a Person are also to its permitted successors and assigns; and
(8) all percentages resulting from any calculation in respect
of a Note shall be rounded to the nearest one hundred-thousandth of a percentage
point, with five one-millionths of a percentage point rounded upwards (e.g.,
9.8976545% (or .09876545) would be rounded to 9.87655% (or .0987655)), and all
dollar amounts used in or resulting from such calculation in respect of a Note
shall be rounded to the nearest cent (with one-half cent rounded upwards).
ARTICLE II
THE NOTES
SECTION 1.3 Forms of the Notes Generally. (a) On the Closing Date, the
Notes shall be in substantially the forms provided for in Exhibit A (in the case
of the Floating Rate Notes) and Exhibit B (in the case of the Fixed Rate Notes)
to this Indenture, with such appropriate insertions, omissions, substitutions
and other variations as are required or permitted by this Indenture, and may
have such letters, numbers or other marks of identification or designation and
such legends or endorsements placed thereon as may be required to comply with
any law or with any rules made pursuant thereto or with the rules of any
securities exchange on which the Notes may be listed or governmental agency or
as may, consistent herewith, be determined by the Authorized Officers executing
such Notes, as evidenced by their execution of the Notes. The Notes shall be
typewritten, printed, lithographed or engraved on steel engraved borders or may
be produced in any other manner, all as determined by the officers executing
such Notes, as evidenced by their execution of such Notes.
(1) Each Note shall be dated the date of its authentication.
Each Note shall bear the Trustee's Certificate of Authentication as provided in
Section 2.2.
(2) On the Closing Date, the appropriate Authorized Officers
of the Issuer will execute and deliver to the Trustee (i) a Restricted Global
Floating Rate Note to be in an aggregate principal amount of up to $70,000,000
and a Restricted Global Fixed Rate Note to be in an aggregate principal amount
of up to $109,000,000, and (ii) a Regulation S Global Floating Rate Note to be
in an aggregate principal amount of up to $70,000,000 and a Regulation S Global
Fixed Rate Note to be in an aggregate principal amount of up to $109,000,000;
provided, however, that the aggregate principal amount of such Notes shall not
exceed $179,000,000.
Each Global Note (i) shall be delivered by the Trustee to DTC acting as
the Depository or, pursuant to DTC's instructions, shall be delivered by the
Trustee on behalf of DTC to and deposited with the DTC Custodian, and in either
case shall be registered in the name of Cede and (ii) shall bear a legend
substantially to the following effect:
"Unless this certificate is presented by an authorized
representative of The Depository Trust Company, a New York corporation
("DTC"), to the Issuer or its agent for registration of transfer,
exchange or payment, and any certificate issued is registered in the
name of Cede & Co. or in such other name as is requested by an
authorized representative of DTC (and any payment is made to Cede & Co.
or to such other entity as is requested by an authorized representative
of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered
owner hereof, Cede & Co., has an interest herein."
Any Global Note may be deposited with such other Depository as the
Issuer may from time to time designate, and shall bear such legend as may be
appropriate; provided that such successor Depository maintains a book-entry
system that qualifies to be treated as "registered form" under Section 163(f)(3)
of the Code.
(3) If at any time the Depository for the Global Note notifies
the Issuer that it is unwilling or unable to continue as Depository for such
Global Note or if at any time the Depository for such Global Note shall no
longer be eligible to act as such under this Section 2.1, the Issuer shall
appoint a successor Depository with respect to such Global Note. Any such
successor Depository must maintain a book-entry system that qualifies under
Section 163(f)(3) of the Code. If a successor Depository for such Global Note is
not appointed by the Issuer within 90 days after the Issuer receives such notice
or becomes aware of such ineligibility, the Issuer's election pursuant to this
Section 2.1 that such Notes be represented by a Global Note shall no longer be
effective and the Issuer will execute, and the Trustee will authenticate and
deliver Individual Notes in any authorized denominations in an aggregate
principal amount equal to the principal amount of such Global Note in exchange
for such Global Note. If the Trustee has instituted or has been directed to
institute any judicial proceeding in a court to enforce the rights of the
Noteholders under the Notes, and the Trustee has been advised by counsel that in
connection with such proceeding it is necessary or appropriate for the Trustee
to obtain possession of the Notes, the Trustee may in its sole discretion
determine that the Notes represented by a Global Note shall no longer be
represented by such Global Note. In such event, the Issuer hereby agrees to
execute and the Trustee will authenticate and deliver, in exchange for such
Global Note, Individual Notes (and if the Trustee has in its possession
Individual Notes previously executed by the Issuer, the Trustee will
authenticate and deliver such Notes), in authorized denominations, in an
aggregate principal amount equal to the principal amount of such Global Note.
(4) The Global Notes shall in all respects be entitled to the
same benefits under this Indenture as Individual Notes authenticated and
delivered hereunder.
Beneficial interests in the Global Notes shall be held in minimum
denominations of $25,000 of Original Principal Amount and integral multiples of
$1,000 of Original Principal Amount above such minimum amount. Beneficial Owners
of a Global Note will be entitled to receive physical delivery of Individual
Notes only as provided herein. The Individual Notes will be issuable in minimum
denominations of $25,000 of Original Principal Amount and integral multiples of
$1,000 of Original Principal Amount above such minimum amount.
SECTION 1.4 Form of Trustee's Certificate of Authentication.
The Trustee's certificate of authentication for Notes shall be in
substantially the following form:
This Note is one of the Notes designated above and referred to in the
within-mentioned Indenture.
____________________________,
as Trustee
By:_________________________
Authorized Officer
OR
____________________________,
as Authenticating Agent
By:_________________________
Authorized Officer
SECTION 1.5 The Notes. (a) The Notes shall be designated as (i) the
Issuer's Senior Secured Floating Rate Notes due December 15, 2007 and (ii) the
Issuer's 7.90% Senior Secured Notes due December 15, 2007. Each Note shall rank
pari passu with each other Note and be equally and ratably secured by the
Collateral. The aggregate principal amount of Floating Rate Notes and Fixed Rate
Notes that may be authenticated, delivered and outstanding at any time under
this Indenture is limited to $70,000,000 and $109,000,000, respectively (except
for Notes authenticated and delivered upon transfer of, or in exchange for, or
in lieu of, other Notes pursuant to the provisions of this Indenture or the
Notes). All Notes shall be substantially identical to all other Notes except as
to denominations and tenor and except as may otherwise be provided by resolution
of the Issuer and expressly permitted in this Indenture.
(1) The Notes shall be secured as provided in the Construction
Loan Agreement.
SECTION 1.6 Execution, Authentication and Delivery of the Notes. Each
Note shall be executed manually or in facsimile on behalf of the Issuer by its
Authorized Officer. Notes bearing the manual or facsimile signatures of
individuals who were at any time the Authorized Officers of the Issuer shall
bind the Issuer, notwithstanding that such individuals, or any of them, shall
have ceased, for any reason, to hold such offices prior to the authentication
and delivery of such Note or did not hold such offices at the date of any such
Note.
The Trustee is authorized, upon receipt of Notes duly executed on
behalf of the Issuer for the purposes of the original issuance of Notes, (i) to
authenticate such Notes in an aggregate principal amount not in excess of the
aggregate principal amount specified herein and to deliver such Notes in
accordance with the written order or orders of the Issuer signed on its behalf
by any Authorized Officer and (ii) thereafter to authenticate and deliver Notes
in accordance with the provisions hereinafter set forth.
No Note shall be entitled to any benefit under this Indenture or be
valid or obligatory for any purpose unless there appears on such Note a
certificate of authentication substantially in the form provided for herein,
executed by the Trustee by manual signature, and such certificate of
authentication upon any Note shall be conclusive evidence, and the only
evidence, that such Note has been duly authenticated and delivered hereunder and
is entitled to the benefits of this Indenture.
SECTION 1.7 Registration; Transfer and Exchange; Restrictions on
Transfer of Notes. (a) The Trustee shall be the Note Registrar for the
registration and transfer of the Notes. The Note Registrar shall cause to be
maintained in accordance with the provisions of this Section 2.5 a register (the
"Note Register") in which, subject to such reasonable regulations as it may
prescribe, the Note Registrar shall provide for the registration of the Notes
and of transfers and exchanges of Notes as herein provided.
(1) The Note Register shall show the amount of such Notes,
whether a Note is a Fixed Rate Note or a Floating Rate Note, the date of issue,
all subsequent transfers and changes of ownership in respect thereof and the
names, taxpayer identifying numbers (if relevant to a specific Holder), and
addresses of the Holders of the Notes and any payment instructions with respect
thereto (if different from a Holder's registered address). The Note Register
shall also include notations as to whether Notes have been paid or cancelled,
and, in the case of mutilated, destroyed, stolen or lost Notes, whether such
Notes have been replaced. In the case of the replacement of any of the Notes,
the Note Register will include notations of the Note so replaced, and the Notes
issued in replacement thereof. In the case of the cancellation of any of the
Notes, the Note Register will include notations of the Note so cancelled and the
date on which such Note was cancelled. The Note Registrar shall at all
reasonable times during office hours make the Note Register available, upon
reasonable advance request therefor, to the Trustee (if the Trustee is not then
serving as Note Registrar), the Issuer or any Person authorized by the Issuer in
writing for inspection and for the taking of copies thereof or extracts
therefrom, and at the expense of the Issuer the Note Registrar shall deliver to
such Persons all lists of Holders as they may request.
(2) A Note may be transferred by the Holder thereof only upon
presentation and surrender of such Note at the Corporate Trust Office of the
Note Registrar duly endorsed or accompanied by an assignment duly executed by
such Holder or his duly authorized attorney-in-fact in such form as shall be
satisfactory to the Note Registrar. Upon the transfer of any Note in accordance
with the preceding sentence and subject to the provisions of this Section 2.5,
the Issuer shall execute, the Authenticating Agent shall authenticate and the
Note Registrar shall deliver to the transferee one or more new Notes of the same
type (i.e., Fixed Rate Note or Floating Rate Note, as applicable) in authorized
denominations, evidencing, in the aggregate, the same principal balance as the
Note being transferred.
(3) A Note may be exchanged by the Holder thereof for any
number of new Notes of the same type (i.e., Fixed Rate Note or Floating Rate
Note, as applicable) in authorized denominations, representing in the aggregate
the same principal balance as the Note surrendered, upon surrender of the Note
to be exchanged at the Corporate Trust Office of the Note Registrar. Notes
delivered upon any such exchange will evidence the same obligations under the
Notes and this Agreement, and will be entitled to the same rights and
privileges, as the Notes surrendered. Upon the exchange of any Note in
accordance with the preceding sentence, the Issuer shall execute, the
Authenticating Agent shall authenticate and the Note Registrar shall deliver to
the exchanging Holder one or more new Notes of the same type (i.e., Fixed Rate
Note or Floating Rate Note, as applicable), in authorized denominations,
evidencing, in the aggregate, the same principal balance as the Note being
exchanged. No certifications shall be required in respect of any such exchange.
(4) If Individual Notes have been issued pursuant to Section
2.1(d), subject to Section 2.5(j), no restrictions shall apply to the transfer
or registration of transfer of an Unlegended Individual Note to a transferee
that takes delivery in the form of an Individual Note. By acceptance of a
Legended Individual Note, whether upon original issuance or subsequent transfer,
each Holder of such a Note acknowledges the restrictions on the transfer of such
Note set forth in the Securities Legend and agrees that it will transfer such a
Note only as provided herein. In addition to the provisions of Section 2.5(j),
the following restrictions shall apply with respect to the transfer and
registration of transfer of a Legended Individual Note to a transferee that
takes delivery in the form of an Individual Note:
(1) The Note Registrar shall register the transfer of
a Legended Individual Note if the requested transfer is (x) to the
Issuer or an Affiliate of the Issuer (such Affiliate status to be
certified in writing by an Authorized Officer of the Issuer in a form
satisfactory to the Note Registrar) or (y) being made by a transferor
who has provided the Note Registrar with a Rule 144A Exchange
Certificate; and
(2) The Note Registrar shall register the transfer of
a Legended Individual Note if the transferor has provided the Note
Registrar with a Regulation S Certificate.
(5) Subject to Section 2.5(j), so long as the Global Notes
remain outstanding and are held by or on behalf of the Depository, transfers of
beneficial interests in any of such Global Notes, may be made only in accordance
with this Section 2.5(f) and in accordance with Applicable Procedures.
(1) A beneficial interest in a Regulation S Global
Note may be transferred to a transferee that is a QIB and takes
delivery in the form of a beneficial interest in the Restricted Global
Note only upon receipt by the Note Registrar of a Rule 144A Exchange
Certificate.
(2) A beneficial interest in a Restricted Global Note
may be transferred to a transferee that takes delivery in the form of a
beneficial interest in a Regulation S Global Note only upon receipt by
the Note Registrar of a Regulation S Certificate.
(3) No restrictions shall apply with respect to the
transfer or registration of transfer of (x) a beneficial interest in a
Restricted Global Note to a transferee that is a QIB that takes
delivery in the form of a beneficial interest in a Restricted Global
Note or (y) a beneficial interest in a Regulation S Global Note to a
transferee that takes delivery in the form of a beneficial interest in
a Regulation S Global Note.
(6) Upon acceptance for transfer of a beneficial interest in
any Global Note for a beneficial interest in another Global Note as provided
herein, the Note Registrar shall (or shall request the Depository to) endorse on
the schedules affixed to each of such Global Notes (or on continuations of such
schedules affixed to each of such Global Notes and made parts thereof)
appropriate notations evidencing the date of such transfer and (x) in the case
of the Global Note from which such transfer is made, a decrease in the principal
balance of such Global Note equal to the principal balance being transferred and
(y) in the case of the Global Note into which such transfer is made, an increase
in the principal balance of such Global Note equal to the principal balance
being transferred.
(7) The following provisions shall apply to the placement of
the Securities Legend on any Individual Note initially issued pursuant to
Section 2.1(d) or issued in exchange for or upon transfer of another Individual
Note or of a beneficial interest in any of the Global Notes and to the removal
of the Securities Legend from any Legended Individual Note.
(1) Unless determined otherwise by the Note Registrar
in accordance with applicable law, an Individual Note initially issued
pursuant to Section 2.1(d) in exchange for a beneficial interest in a
Restricted Global Note or a Regulation S Global Note prior to the end
of the Restricted Period shall bear the Securities Legend.
(2) Unless determined otherwise by the Issuer, based
upon an Opinion of Counsel satisfactory to the Note Registrar, in
accordance with applicable law, an Individual Note initially issued
pursuant to Section 2.1(d) in exchange for a beneficial interest in an
Regulation S Global Note shall not bear the Securities Legend.
(3) Upon the transfer, exchange or replacement of a
Legended Individual Note, or upon specific request of a holder of a
Legended Individual Note for removal of the Securities Legend
therefrom, the Note Registrar shall deliver an Unlegended Individual
Note or Notes if there is provided to the Note Registrar evidence
reasonably satisfactory to the Note Registrar (which may include an
Opinion of Counsel to the transferor or transferee) as may reasonably
be required by the Note Registrar that neither the Securities Legend
nor the restrictions on transfer set forth therein are required to
ensure compliance with the provisions of the Securities Act.
(4) Upon the transfer, exchange or replacement of an
Unlegended Individual Note for an Individual Note, the Note Registrar
shall deliver a Legended or Unlegended Individual Note or Notes, as the
Holder may request.
(8) Subject to the restrictions on transfer and exchange set
forth in this Section 2.5, the holder of any Individual Note may transfer or
exchange the same in whole or in part (in an initial principal balance equal to
$25,000 or any integral multiple of $1,000 in excess thereof) by surrendering
such Individual Note at the Corporate Trust Office of the Note Registrar, or at
the office of any other Transfer Agent, together with an executed instrument of
assignment and transfer satisfactory in form and substance to the Note Registrar
in the case of transfer and a written request for exchange in the case of
exchange. Subject to Section 2.1 and the restrictions imposed by this Section
2.5, the Beneficial Owner of a Global Note may, subject to Applicable
Procedures, cause the Depository (or its nominee) to notify the Note Registrar
in writing of a request for transfer or exchange of such beneficial interest in
whole or in part (in an initial principal balance equal to $25,000 or any
integral multiple of $1,000 in excess thereof) for an Individual Note or Notes.
Following a proper request for transfer or exchange, the Note Registrar shall,
within five Business Days of such request if made at such Corporate Trust
Office, or within 10 Business Days if made at the office of another Transfer
Agent (other than the Note Registrar), cause the Issuer to execute and the
Authenticating Agent to authenticate, and the Note Registrar shall deliver at
such Corporate Trust Office or such transfer agent, as the case may be, to the
transferee (in the case of transfer) or holder (in the case of exchange) or send
by first class mail at the risk of the transferee (in the case of transfer) or
holder (in the case of exchange) to such address as the transferee or holder, as
applicable, may request, an Individual Note or Notes, as the case may require,
for a like aggregate principal balance and in such authorized denomination or
denominations as may be requested. The presentation for transfer or exchange of
any Individual Note shall not be valid unless made at the Corporate Trust Office
of the Note Registrar or at the office of another Transfer Agent by the
registered holder in person, or by a duly authorized attorney-in-fact. The Note
Registrar or any other transfer agent may decline to accept any request for an
exchange or registration of transfer of any Note during the period commencing on
a Record Date and ending on the related Payment Date on the Notes.
(9) Transfer, registration and exchange shall be permitted as
provided in this Section 2.5 without any charge to the Holder except for the
expenses of delivery (if any) not made by regular mail and except, if the Note
Registrar shall so require, the payment of a sum sufficient to cover any stamp
duty, tax or governmental charge or insurance charge that may be imposed in
relation thereto; provided that any Opinions of Counsel or certificates required
by this Section 2.5 shall be at the expense of the Holder or its proposed
transferee and provided further that, in the event of any exchange of beneficial
interests in a Global Note for Individual Notes pursuant to Section 2.1(d) and
stamp duties, taxes or governmental charges or insurance charges shall be an
expense of the Issuer. Registration of the transfer of a Note by the Note
Registrar shall be deemed to be the acknowledgment of such transfer on behalf of
the Issuer.
(10) All Notes surrendered for registration of transfer or
exchange shall be cancelled by the Note Registrar or the Trustee in accordance
with their standard procedures.
(11) The Note Registrar shall provide to the Trustee (unless
the Trustee is acting as Note Registrar) (i) upon receipt of a written request
from the Trustee, notice of each registration of transfer of a Note, (ii) an
updated copy of the Note Register at the beginning of each calendar quarter and
(iii) upon receipt of a written request therefor, a list of Holders of the
Notes.
(12) Prior to due presentment of a Note for registration of
transfer, the Issuer, the Trustee and any agent of the Issuer or the Trustee may
treat the Person in whose name such Note is registered as the absolute and sole
owner of such Note for the purpose of receiving payment of principal of, and
interest (and Additional Amounts, if any) on such registered Note and for all
other purposes whatsoever, whether or not such registered Note be overdue, and
neither the Issuer, the Trustee nor any agent of the Issuer or the Trustee shall
be affected by notice to the contrary, and payment of the principal of and
interest on such registered Note by the Trustee shall be made only to or upon
the order of such registered owner.
(13) The transfer of any Note, or beneficial interest therein,
inconsistent with or contrary to this Indenture shall be deemed void ab initio
for all purposes under this Indenture.
Notwithstanding anything to the contrary in this Section, a Fixed Rate
Note may be replaced or exchanged only for another Fixed Rate Note in accordance
with this Indenture, and a Floating Rate Note may be replaced or exchanged only
for another Floating Rate Note in accordance with this Indenture.
SECTION 1.8 Mutilated, Destroyed, Lost and Stolen Notes. If any
mutilated Note is surrendered to the Trustee, the Issuer shall execute, and the
Trustee shall authenticate and deliver in exchange therefor, a new Note of like
tenor and principal amount and bearing a number not contemporaneously
outstanding. Each new Note issued pursuant to this Section in exchange for, in
substitution for, or in lieu of a Predecessor Note shall be dated the date of
such Predecessor Note.
If there shall be delivered to the Issuer and the Trustee (i) evidence
to their satisfaction of the destruction, loss or theft of any Note and (ii)
such security or indemnity as may be required by each of them to save each of
them and any agent of either of them harmless, then, in the absence of notice to
the Issuer or the Trustee that such Note has been acquired by a bona fide
purchaser, the Issuer shall execute and upon its request the Trustee shall
authenticate and deliver, in lieu of any such destroyed, lost or stolen Note, a
new Note of like kind (Fixed Rate or Floating Rate) tenor and principal amount
and bearing a number not contemporaneously outstanding. In every case of
mutilation or defacement, the applicant shall surrender to the Trustee the Note
so mutilated or defaced. Upon the issuance of any substitute Note, the Issuer
may require the payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in relation thereto and any other
expenses connected therewith.
Every new Note issued pursuant to this Section in lieu of any
destroyed, lost or stolen Note shall constitute an original additional
contractual obligation of the Issuer, evidencing the same debt as the
Predecessor Note, whether or not the destroyed, lost or stolen Note shall be at
any time enforceable by anyone, and any such new Note shall be entitled to all
the benefits of this Indenture and of the other Basic Documents and the
Construction Loan Agreement equally and proportionately with any and all other
Notes and to the same extent as such Predecessor Note.
All Notes shall be held and owned upon the express condition that, to
the extent permitted by law, the foregoing provisions are exclusive with respect
to the replacement or payment of mutilated, destroyed, lost or stolen Notes and
shall preclude (to the extent lawful) all other rights and remedies with respect
to the replacement or payment of mutilated, destroyed, lost or stolen Notes or
negotiable instruments without their surrender.
Notwithstanding anything to the contrary in this Section, a Fixed Rate
Note may be replaced or exchanged only for another Fixed Rate Note in accordance
with this Indenture, and a Floating Rate Note may be replaced or exchanged only
for another Floating Rate Note in accordance with this Indenture.
SECTION 1.9 Payment of Principal and Interest. (a0 The Issuer hereby
authorizes and directs the Trustee to make or cause to be made payment of the
principal of, interest on and Additional Amounts with respect to the Notes as
set forth in this Indenture, including Section 7.1(b).
(1) Any interest shall be paid, unless otherwise provided in
the text of the Notes, to the persons (the "Registered Owners") in whose names
such Notes are registered on the Note Register maintained pursuant to Section
2.5(a) hereof at the close of business on the related Record Date; provided,
however, that interest payable upon the Maturity Date of the principal of any
Note shall be payable to the Person to whom such principal is payable. Principal
of the Notes shall be payable when due against surrender of the Notes at the
Corporate Trust Office of the Paying Agent. Payments of principal of and
interest on, and Additional Amounts, if any, the Notes shall be made by check
mailed on or before the due date for such payment to the person entitled thereto
at such person's address appearing on the Note Register for the Notes maintained
pursuant to Section 2.5(a) hereof, or, in the case of payments of principal, to
such other address as the registered Holder shall provide in writing at the time
of surrender of the Notes. Payments of principal of and interest and Additional
Amounts, if any, on the Notes shall be paid by wire transfer of immediately
available funds to such account with a bank in the United States as such Holder
shall designate by written instruction received by the Trustee not less than
five days prior to the applicable Payment Date.
SECTION 1.10 Interest on New Notes. Interest shall be deemed to have
been paid on each new Note (a "New Note") issued pursuant to Section 2.5 hereof
in exchange for, in substitution for, or in lieu of a Predecessor Note to the
date to which interest was paid on such Predecessor Note.
SECTION 1.11 Cancellation. The Issuer may at any time deliver to the
Trustee for cancellation any Notes previously authenticated and delivered
hereunder which the Issuer may have acquired in any manner whatsoever, and all
Notes so delivered shall be promptly cancelled by the Trustee.
All Notes delivered to the Trustee for payment, redemption, or exchange
as herein or in the Notes provided shall be cancelled and destroyed by the
Trustee or such other person as may be jointly designated by the Issuer and the
Trustee, which shall thereupon furnish certificates of such destruction to the
Issuer.
SECTION 1.12 Transfer Agent and Paying Agent. The Trustee shall be the
Transfer Agent for the Notes and the Paying Agent for the Notes.
SECTION 1.13 Rule 144A Information. For so long as any of the Notes
remain Outstanding and are "restricted securities" within the meaning of Rule
144(a)(3) under the Securities Act, the Issuer will, during any period in which
the Issuer is not subject to Section 13 or 15(d) under the Securities Act make
available the Rule 144A Information at its own expense to any Holder of a Note
or any Beneficial Owner of a Global Note, to a prospective purchaser of a Note
or beneficial interest therein who is a QIB, in each case at the Holder's
written request to the Issuer or to the Trustee (which shall notify the Issuer
in writing of any such request). Upon request by the Issuer, the Trustee shall
so furnish the Rule 144A Information to the extent provided by the Issuer to the
Trustee.
SECTION 1.14 Provision of Payment Date Statements and Other Information
to Holders. (a0 On each Payment Date, the Trustee shall forward a statement (the
"Payment Date Statement") in respect of the distribution made on any such
Payment Date by mail to (i) the Depository, (ii) the Rating Agencies, (iii) the
Issuer, (iv) the Holders of Individual Notes that deliver an Information Request
to the Trustee, (v) the Insurer and (vi) other Beneficial Owners of Notes that
deliver an Information Request to the Trustee, confirming their beneficial
ownership of Notes. To the extent such information is either known by a Trust
Officer of the Trustee or furnished to the Trustee pursuant to Section 2.12(b)
below by the Issuer, each Payment Date Statement will include the following
information:
(1) the amount of the payment made on such Payment
Date allocable to principal (or the Make Whole Amount, as applicable)
and separately identifying the amount of any principal payment or
prepayments (specifying the reason therefor) included therein;
(2) the amount of the payment made on such Payment
Date allocable to interest and the amount of Additional Amounts, if
any;
(3) if the payment to the Noteholders is less than
the full amount payable on such Payment Date to such Holders, the
amount of the shortfall;
(4) the Outstanding Principal Amount of the Floating
Rate Notes and the Fixed Rate Notes after giving effect to any payment
of principal on such Payment Date;
(5) LIBOR as determined on the Determination Date
with respect to the Reset Date immediately preceding such Payment Date
and the interest rate applicable to the Floating Rate Notes for the
period commencing on such Payment Date and ending on (but not
including) the next succeeding Payment Date;
(6) notice of the occurrence of a Default or Event of
Default;
(7) notice of any claims made or payments made under
the Policy or the Reinsurance Agreement;
(8) the then-current estimated date on which the
Resort will first accept paying guests;
(9) the amount, if any, by which the Issuer's current
construction project budget is estimated to exceed $298,000,000;
(10) the amount spent by or on behalf of the Issuer
to acquire, construct, equip and furnish the Hotel as part of the
construction project budget; and
(11) the then-remaining amounts of committed debt and
equity funds available for payment of costs to acquire, construct,
equip and furnish the Hotel.
The Issuer shall provide the information specified in paragraphs (8)
through and including (11) of the Payment Date Statement to the Trustee on or
before the Deposit Date preceding the applicable Interest Payment Date.
(2) Additional information regarding the Notes and the Issuer
shall also be prepared by the Issuer upon reasonable request by the Rating
Agencies, the Trustee, any agent acting on its behalf, or any Beneficial Owner
that provides to the Trustee an Information Request certifying to its beneficial
ownership of Notes or any Noteholder that provides an Information Request and
upon payment of the Trustee's fees and expenses in connection with providing
such information. Such additional information (to the extent provided to the
Trustee by the Issuer) shall be distributed by the Trustee to the Rating
Agencies and, upon payment or reimbursement of the Trustee's costs and expenses
of distribution thereof, to requesting Beneficial Owners that provide to the
Trustee an Information Request certifying to their beneficial ownership of Notes
and Noteholders that provide an Information Request.
(3) Within 60 days following the end of each calendar year,
the Trustee shall prepare, or cause to be prepared, and provide to each Person
who at any time during the calendar year was a Noteholder such customary
information as the Trustee deems necessary or desirable for Noteholders to
prepare their federal income tax returns. Such obligation of the Trustee shall
be deemed to have been satisfied to the extent that substantially comparable
information shall be provided by the Trustee pursuant to any requirements of the
Code. Upon prior written request and the prior payment of the costs and expenses
to be incurred in connection therewith, the Trustee will prepare such other
reasonable reports as may be requested in writing by any Holder of a Note.
SECTION 1.15 Provision of Financial Information of Insurer. (a0 The
Insurer agrees that, while any of the Notes remain outstanding, it will deliver
to the Trustee, for redelivery, upon request, to any Noteholder or prospective
purchasers of Notes or the Initial Purchaser any quarterly or annual financial
statements (which may be prepared in accordance with the statutory basis of
accounting) that it most recently filed with the insurance regulatory
authorities of its jurisdiction of domicile. The Insurer further agrees that,
while any of the Notes remain outstanding, it will cause to be delivered to the
Trustee, upon request, for redelivery to any holder of Notes or prospective
purchasers of Notes or the Initial Purchaser quarterly and annual financial
statements (which may be prepared in accordance with the statutory basis of
accounting) presented on an individual and a combined basis based upon the
financial statements most recently filed by the Reinsurer and each Pool Member
with the insurance regulatory authorities of their respective jurisdictions of
domicile.
(1) Upon the request of any Holder or Beneficial Owner for
financial statements of the Insurer or the Pool Members (including the
Reinsurer), the Trustee shall deliver a written request for such statements to
the Insurer and upon receipt of such statements deliver such statements to the
requesting Holder or Beneficial Owner.
ARTICLE III
COVENANTS
SECTION 1.16 Payment of Principal and Interest; Appointment of Agents.
(a) The Issuer shall duly and punctually pay to the Trustee the principal (and
Make Whole Amounts, as applicable) of, interest on, and Additional Amounts with
respect to the Notes and all other amounts due to the Trustee pursuant to this
Indenture, the Construction Loan Agreement and the other Construction Loan
Documents, all in accordance with the terms of the Notes, the Construction Loan
Agreement, the other Construction Loan Documents and this Indenture.
(1) The Issuer hereby appoints the Trustee as the Paying
Agent, the Calculation Agent, the Authenticating Agent, the Transfer Agent and
the Note Registrar (collectively the "Agents"). Each Person which ceases to be
the Trustee for any reason shall cease to be the Agents, and each Person which
becomes a successor Trustee pursuant to Article V hereof shall become the
Agents.
SECTION 1.17 Performance of Obligations. (a0 The Issuer shall
punctually perform and observe all its obligations and agreements specified in
this Indenture and the Construction Loan Documents.
(1) The Issuer may contract with other Persons to assist it in
performing its duties under this Indenture, and any performance of such duties
by a Person identified to the Trustee in an Officer's Certificate of the Issuer
shall be deemed to be action taken by the Issuer.
(2) So long as any Notes are outstanding or any amounts due
with respect to the Notes or to the Holders, the Trustee or the Insurer pursuant
to this Indenture remain unpaid, the Issuer shall not permit the validity or
effectiveness of this Indenture to be impaired.
SECTION 1.18 Further Instruments and Acts. Upon request of the Trustee,
the Issuer shall execute and deliver such further instruments and do such
further acts as may be reasonably necessary or proper to carry out more
effectively the purposes of this Indenture and the Construction Loan Documents.
SECTION 1.19 Notice of Events of Default. The Issuer shall give the
Trustee, the Insurer, the Guarantor and the Rating Agencies written notice of
each Default as provided in Section 4.1 and of each default on the part of any
party to the Basic Documents or the Construction Loan Documents with respect to
any of the provisions thereof to which the Issuer has knowledge.
SECTION 1.20 Maintenance of Books and Records. The Issuer shall
maintain and implement administrative and operating procedures reasonably
necessary in the performance of its obligations hereunder and the Issuer shall
keep and maintain at all times, or cause to be kept and maintained at all times
at its principal office, all documents, books, records, accounts and other
information reasonably necessary or advisable for the performance of its
obligations hereunder to the extent required under applicable law.
SECTION 1.21 Continuation of Ratings. The Issuer agrees to provide the
Rating Agencies with information, to the extent reasonably obtainable by the
Issuer, to allow the Rating Agencies to monitor the rating of the Notes. The
Issuer shall pay such ongoing fees of the Rating Agencies as they may reasonably
request to monitor the ratings of the Notes.
ARTICLE IV
REMEDIES
SECTION 1.22 Notices of Default. The Issuer shall deliver to Trustee,
the Insurer and the Guarantor (with a copy to the Rating Agencies), within five
Business Days after obtaining knowledge of the occurrence thereof, written
notice in the form of an Officer's Certificate of the occurrence of any Default,
its status and what action the Issuer is taking or proposes to take with respect
thereto. In addition, the Trustee shall deliver the notices required pursuant to
Section 5.5.
SECTION 1.23 Exercise of Remedies. If an Event of Default has occurred
and is continuing, the Insurer so long as no Policy Event has occurred and is
continuing, or the Holders of greater than 50% of the Outstanding Principal
Amount of the Notes if a Policy Event has occurred and is continuing, shall have
the right (subject to providing an indemnity to the reasonable satisfaction of
the Trustee) to direct the time, method and place of exercising any remedy
available to the Trustee, and of conducting any Proceeding for any remedy
available to the Trustee, with respect to the Notes, this Indenture, the
Construction Loan Agreement, the Construction Loan Deed of Trust and each other
Construction Loan Document, and of exercising any trust or power conferred on
the Trustee; provided that:
(1) such direction shall not be in conflict with any rule of
law or with this Indenture; and
(2) if Noteholders (and not the Insurer) have directed the
Trustee to take the action in question, the Trustee need not take any action
which might materially adversely affect the rights of any Noteholders not
consenting to such action.
SECTION 1.24 Limitation of Suits. No Noteholder shall have any right to
institute any Proceeding, judicial or otherwise, with respect to this Indenture
or for the appointment of a receiver or trustee, or for any other remedy
hereunder, unless:
(1) a Policy Event has occurred and is continuing;
(2) such Holder has previously given written notice to the
Trustee of a continuing Event of Default;
(3) the Holders of greater than 50% of the Outstanding
Principal Amount of Notes have made written request to the Trustee to institute
such Proceeding in respect of such Event of Default in its own name as Trustee
hereunder;
(4) such Holder or Holders has offered to the Trustee
indemnity reasonably satisfactory to the Trustee against the costs, expenses and
liabilities to be incurred or in respect of which it may be or become liable in
complying with such request;
(5) the Trustee for sixty (60) calendar days after its receipt
of such notice, request and offer of indemnity has failed to institute such
Proceedings; and
(6) no direction inconsistent with such written request has
been received by the Trustee during such 60-day period from the Holders of
greater than 50% of the Outstanding Principal Amount of the Notes.
It is understood and intended that no one or more Holders shall have
any right in any manner whatsoever by virtue of, or by availing of, any
provision of this Indenture to affect, disturb or prejudice the rights of any
other Holders or to obtain or to seek to obtain priority or preference over any
other Holders or to enforce any right under this Indenture, except in the manner
herein provided.
SECTION 1.25 Unconditional Rights of Noteholders To Receive Principal,
Interest and Additional Amounts. Notwithstanding any other provisions in this
Indenture and subject to the Priority of Payments, the Holder of each Note shall
have the right, which is absolute and unconditional, to receive payment of the
principal (or the Make Whole Amount, as applicable) of, interest on and
Additional Amounts with respect to such Note, and such right shall not be
impaired without the consent of such Holder.
SECTION 1.26 Performance and Enforcement of Certain Obligations. (a0
Unless a Policy Event has occurred and is continuing, the Trustee may, and at
the direction of the Insurer (subject to having been indemnified reasonably to
its satisfaction) shall, take all lawful action to compel or secure the
performance and observance by the Issuer and the Guarantor, of each of their
respective obligations under this Indenture, the Construction Loan Agreement,
Construction Loan Deed of Trust and each other Construction Loan Documents
including the Completion Guaranty and the Payment Guaranty, and, if so directed,
the Trustee shall exercise any and all rights, remedies, powers and privileges
lawfully available under or in connection with all of such agreements, including
the transmission of notices of default thereunder and the institution of legal,
arbitral or administrative actions or proceedings to compel or secure
performance thereunder.
(1) If an Event of Default and a Policy Event have occurred
and are continuing, the Trustee may, and at the direction of the Holders of
greater than 50% of the Outstanding Principal Amount of the Notes (subject to
having been indemnified to its satisfaction), shall take all lawful action to
compel or secure the performance and observance by the Insurer, the Issuer and
the Guarantor of each of their respective obligations under this Indenture, the
other Basic Documents, the Construction Loan Agreement, the Construction Deed of
Trust, the other Construction Loan Documents (including the Completion Guarantee
and the Payment Guarantee) and, if so directed, the Trustee shall exercise any
and all rights, remedies, powers and privileges lawfully available under or in
connection with all of such agreements, including the transmission of notices of
default thereunder and the institutions of legal, arbitral or administrative
actions or proceedings to compel or secure performance thereunder.
SECTION 1.27 Special Construction Servicer. In the event that a Policy
Event occurs prior to the Opening Date, the Trustee shall appoint a special
construction servicer (the "Special Construction Servicer") to administer the
application of the balance remaining in the Construction Loan Proceeds Account
to the payment of Costs under the Construction Loan Agreement and to provide
other services determined by the Trustee related to the construction of the
Required Improvements on behalf of the Trustee for the benefit of the
Noteholders. Any such Special Construction Servicer will be an entity that
appears at the time of appointment on the list of "approved special servicers"
for commercial mortgage securitizations maintained by S&P. The Special
Construction Servicer will be required to perform its duties in the best
interests of and for the sole benefit of the Noteholders (as determined by the
Special Construction Servicer in its reasonable good-faith business judgment) in
accordance with the terms of the Construction Loan Documents and in furtherance
of and to the extent consistent with such terms, and in accordance with the
higher of (a) the same care, skill, prudence and diligence with which the
Special Construction Servicer services and administers similar construction
mortgage loans for other third-party portfolios, giving due consideration to
customary and usual standards of practice of prudent institutional commercial
loan special servicers servicing commercial construction loans for third parties
generally and (b) the same care, skill, prudence and diligence which the Special
Construction Servicer uses for construction mortgage loans in its own portfolio.
The administration of the Construction Loan Agreement by the Special
Construction Servicer is required to be undertaken without regard to (i) any
relationship (other than that created by this Indenture, the other Basic
Documents and the Construction Loan Agreement) that it or any of its Affiliates
may have with the Noteholders, the Issuer, the Guarantor, the Insurers or any of
their respective Affiliates; (ii) ownership of any Note by it or any of its
Affiliates; (iii) the adequacy of its compensation for its services or (iv) its
ownership, servicing or special servicing of other mortgage loans. Any expenses
incurred by the Trustee in retaining the Special Construction Servicer and all
amounts of compensation, fees and expenses payable to the Special Construction
Servicer shall be paid by the Issuer on demand.
ARTICLE V
THE TRUSTEE
SECTION 1.28 Duties of the Trustee. (a) So long as no Policy Event has
occurred and is continuing, the Trustee shall take all lawful action directed by
the Insurer to enforce the Trustee's rights and exercise the remedies available
to the Trustee, including at law and in equity, under or with respect to the
Basic Documents, the Construction Loan Agreement, the Construction Loan Deed of
Trust and all of the other Construction Loan Documents, and shall take all
lawful actions directed by the Insurer to fully enable the Insurer to exercise
its rights pursuant to Article XI of this Indenture. The Trustee shall
authenticate the Notes and execute and deliver this Indenture, the Basic
Documents, the Construction Loan Documents to which it is a party and any other
documents, instruments or certificates to which it is a party to be executed and
delivered in connection therewith.
(1) The Trustee shall hold the Policy, the Assignment of
Reinsurance and the Assumption of Liability and Novation Endorsement for the
benefit of the Noteholders and shall enforce all of the rights and powers, and
satisfy all of the obligations, of the beneficiary thereunder.
(2) After the occurrence and during the continuance of an
Event of Default, the Trustee shall exercise the rights and powers vested in it
by this Indenture, the other Basic Documents, the Construction Loan Agreement
and the other Construction Loan Documents, and use the same degree of skill and
care in their exercise as a prudent person would use or exercise under the
circumstances in the conduct of such Person's own affairs.
(3) Prior to the occurrence of an Event of Default, the
Trustee undertakes to perform such duties and only such duties as are
specifically specified in this Indenture, the Construction Loan Agreement, the
other Construction Loan Documents and the other documents to which it is a party
and no implied covenants or obligations shall be read into this Indenture and
the other documents to which it is a party against the Trustee.
(4) In addition, prior to the occurrence of an Event of
Default, in the absence of bad faith on its part, the Trustee may conclusively
rely, as to the truth of the statements and the correctness of the opinions
expressed therein, upon certificates or opinions which are furnished to the
Trustee and conform to the requirements of this Indenture and the other
documents to which it is a party; however, in the case of any such certificates
or opinions which by any provisions hereof are specifically required to be
furnished to the Trustee, the Trustee shall examine the certificates and
opinions to determine whether or not they conform to the requirements of this
Indenture and the other documents to which it is a party; provided, however,
that the Trustee shall not be responsible for the accuracy or content of any
resolution, certificate, statement, opinion, report, document, order or other
instrument furnished by the Issuer hereunder.
(5) The Trustee may not be relieved from liability for its own
negligent action or its own willful misconduct, except that:
(1) the Trustee shall not be liable for any error of
judgment made in good faith by a Trust Officer unless it is proved that
the Trustee was negligent in ascertaining the pertinent facts;
(2) no provision of this Indenture or the other
documents to which it is a party shall require the Trustee to expend or
risk its own funds or otherwise incur financial liability in the
performance of any of its duties hereunder or in the exercise of any of
its rights or powers, if it shall have reasonable grounds to believe
that repayment of such funds or adequate indemnity against such risk or
liability is not reasonably assured to it;
(3) anything in this Indenture and the other
documents to which it is a party to the contrary notwithstanding, in no
event shall the Trustee be liable for special, indirect or
consequential loss or damage of any kind whatsoever (including, but not
limited to, lost profits), even if the Trustee has been advised of the
likelihood of such loss or damage and regardless of the form of action,
or any insufficiency in the Accounts resulting from a loss, including
loss of principal, on any Permitted Investment included therein; and
(4) the right of the Trustee to perform any
discretionary act enumerated in this Indenture and the other documents
to which it is a party shall not be construed as a duty, and the
Trustee shall not be answerable for other than its negligence or
willful misconduct in the performance of such act.
(6) Every provision of this Indenture and the other documents
to which it is a party that in any way relates to the Trustee acting in any of
its capacities is subject to this Section 5.1.
(7) The Trustee shall not be liable for interest on any money
received by it except as the Trustee may agree in writing with the Issuer.
(8) Whether or not herein expressly so provided, every
provision of this Indenture and the other documents to which it is a party
relating to the conduct or affecting the liability of or affording protection to
the Trustee (in any capacity in which it may serve) shall be subject to the
provisions of this Section 5.1.
(9) The Trustee shall not be charged with knowledge of any
Default, Event of Default or Policy Event unless either (1) a Trust Officer
shall have actual knowledge of such Default, Event of Default or Policy Event or
(2) written notice of such Default, Event of Default or Policy Event shall have
been received by a Trust Officer in accordance with the provisions of this
Indenture.
(10) The Trustee accepts its appointment as the Agents.
SECTION 1.29 Rights of Trustee. (a) The Trustee may rely on any
document believed by it to be genuine and to have been signed or presented by
the proper Person. The Trustee need not investigate any fact or matter stated in
such document.
(1) Any request or direction of the Issuer mentioned herein
shall be sufficiently evidenced by an Issuer Order or an Issuer Request.
(2) Before the Trustee acts or refrains from acting, it may
require an Officer's Certificate or an Opinion of Counsel. The Trustee shall not
be liable for any action it takes or omits to take in good faith in reliance on
such Officer's Certificate or Opinion of Counsel.
(3) The Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or by or through
Affiliates, delegates, agents or attorneys or a custodian or nominee, and the
Trustee shall not be responsible for any misconduct or negligence on the part
of, or for the supervision of, any such agent, attorney, custodian or nominee
appointed with due care by it hereunder.
(4) The Trustee shall not be liable for any action it takes or
omits to take in good faith which it believes to be authorized or within its
rights or powers.
(5) The Trustee may consult with counsel, and the advice or
opinion of such counsel or any Opinion of Counsel shall be full and complete
authorization and protection from liability in respect of any action taken,
omitted or suffered by it hereunder in good faith and in reliance thereon.
(6) The Trustee shall be under no obligation to exercise any
of the rights or powers vested in it by this Indenture and the other documents
to which it is a party at the request or direction of the Insurer or any of the
Noteholders pursuant to this Indenture and the other documents to which it is a
party or to institute, conduct or defend any litigation hereunder or in relation
hereto at the request, order or direction of the Insurer or any of the
Noteholders pursuant to this Indenture and the other documents to which it is a
party, unless the Insurer or such Noteholders, as applicable, shall have offered
to the Trustee reasonable security or indemnity satisfactory to the Trustee
against the costs, expenses and liabilities which might be incurred by it in
compliance with such request or direction.
(7) The Trustee shall not be bound to make any investigation
into the facts or matters stated in any document, but the Trustee, in its
discretion, may make such further inquiry or investigation into such facts or
matters as it may see fit, and, if the Trustee shall determine to make such
further inquiry or investigation, it shall be entitled to examine the books,
records and premises of the Issuer, personally or by an agent or attorney.
(8) The Trustee shall not be required to give any bond or
surety in respect of the execution of the trust created hereby or the powers
granted hereunder.
SECTION 1.30 Individual Rights of Trustee. The Trustee, in its
individual or any other capacity, may become the owner or pledgee of Notes and
may otherwise deal with the Issuer or its Affiliates and with the other parties
to the Basic Documents and the Construction Loan Documents and their respective
Affiliates with the same rights it would have had if it were not Trustee.
SECTION 1.31 Trustee's Disclaimer. The Trustee (i) shall not be
responsible for, and makes no representation, as to the validity or adequacy of
the Notes, any Basic Document or any Construction Loan Document, (ii) shall not
be accountable for the Issuer's use of the proceeds from the Notes and (iii)
shall not be responsible for any statement of the Issuer in this Indenture or in
any document executed in connection with the sale of the Notes or in the Notes,
any Basic Document, or any Construction Loan Document, other than the Trustee's
Certificate of Authentication.
The Trustee is and will be acting hereunder solely in its capacity as
Trustee. All parties to this Indenture acknowledge and agree that where there is
any reference herein to Trustee performing any activity, making any decision or
determination, approving or consenting to any matter, exercising any rights,
fulfilling any obligation, exercising any discretion or otherwise acting in any
capacity, the Trustee will not be the party doing so unless it is specifically
authorized and directed to do so in each instance by an appropriate direction
hereunder. Any such performance, decision, determination, approval, consent or
action to be made, taken, given or exercised by Trustee under any Basic Document
that the Trustee is not so specifically authorized and directed to perform in
each instance as required by the terms of this Indenture or such Basic Document
may be made, taken, given or exercised by other parties who are beneficiaries or
agents of beneficiaries of this Indenture.
SECTION 1.32 Notice of Defaults; Notice of Requirement to Pay
Additional Amounts. (a) If the Trustee obtains knowledge (as provided in Section
5.1(j)) of an Event of Default or Policy Event, the Trustee shall mail to each
Noteholder, the Issuer, the Guarantor and the Insurer (with a copy to the Rating
Agencies), notice of such Event of Default or Policy Event within five (5)
calendar days after obtaining knowledge thereof; provided, however, that with
respect to an Event of Default caused by a failure to pay when due the principal
of, interest on or Additional Amounts with respect to the Notes, the notice
shall be mailed promptly after obtaining such notice. If the Trustee receives a
notice from the Issuer pursuant to Section 4.1, the Trustee will include a copy
of such notice with its notice of an Event of Default. Where a notice of the
occurrence of an Event of Default or Policy Event has been given by the Trustee
pursuant to this Section 5.5 and the Event of Default or Policy Event is
thereafter cured, the Trustee shall give notice that the Event of Default or
Policy Event is no longer continuing within ten (10) calendar days after the
Trustee obtains knowledge thereof.
(1) The Trustee shall deliver to the Issuer, the Guarantor and
the Insurer, within five (5) Business Days after obtaining knowledge or receipt
thereof, written notice of any event, condition or circumstance, or any notice,
publication or communication, whether sent or published by a governmental entity
or otherwise, the effect of which would require the Issuer to pay Additional
Amounts hereunder. To the extent that the Trustee has received information
sufficient for it to do so, the Trustee shall calculate the amount of any
Additional Amounts required to be paid by the Issuer on any Deposit Date or
otherwise, and shall deliver notice of such calculation to the Issuer, the
Guarantor and the Insurers as soon as reasonably practicable under the
circumstances.
Absent manifest error, such calculation shall be binding on the Issuer,
the Guarantor and the Insurer, and the Issuer's making of a payment in reliance
on such calculation, even if such calculation is erroneous, shall not result in
a Default or an Event of Default if the Issuer makes payment of any shortfall
immediately after its receipt of written notice thereof from the Trustee.
(2) Before 5:00 p.m. (New York City time) on the Business Day
next succeeding each Deposit Date or any other date on which the Trustee
receives any payment, the Trustee shall provide to the Issuer, the Guarantor,
the Insurer, and the Administrative Agent prompt notice of all amounts it
receives under or pursuant to the Notes, the Construction Loan Agreement, the
Construction Loan Deed of Trust, any interest rate protection agreement, any
other Construction Loan Document (including proceeds collected by the Trustee
upon the sale or other disposition of Collateral or upon the exercise of any
remedies under the Construction Loan Documents), the Policy, the Assignment of
Reinsurance and the Reinsurance Agreement, the Completion Guarantee and the
Payment Guarantee. The Trustee shall specify in such notice the amount received
and the source of such payment and any other relevant details concerning such
payment.
SECTION 1.33 Appointment of Administrative Agent. Until the principal
of and interest on the Notes is indefeasibly paid in full, the Insurer is
irrevocably appointed the "Administrative Agent" under and in accordance with
the terms of the Construction Loan Agreement and the other Construction Loan
Documents; provided, however, that (i) if a Policy Event occurs prior to the
Opening Date, the Insurer shall cease to be the Administrative Agent and the
Special Construction Servicer shall become the Administrative Agent and (ii) if
a Policy Event occurs on or after the Opening Date, the Insurer shall cease to
be the Administrative Agent and the Trustee may, at its option, appoint a
successor Administrative Agent, or, if it does not appoint a successor
Administrative Agent, the Trustee shall perform the duties of the Administrative
Agent. Any Administrative Agent may resign (other than the Insurer, which may
not resign unless a Policy Event occurs), and, if any such Administrative Agent
resigns, a successor Administrative Agent shall be appointed as provided in the
Construction Loan Agreement.
Each Administrative Agent shall have the right and power to take such
action as Administrative Agent and to exercise such powers under this Indenture,
the Construction Loan Agreement, the other Construction Loan Documents and any
other documents as are delegated to the Administrative Agent by the terms hereof
and thereof, together with all such powers as are reasonably incidental thereto.
The Insurer hereby accepts such appointment.
SECTION 1.34 Compensation and Indemnity. (a) On the Closing Date and
from time to time thereafter, the Issuer shall pay to the Trustee any costs,
fees and expenses of its counsel and a fee as agreed upon between the Issuer and
the Trustee in a letter agreement, dated as of the date hereof, as compensation
for its services as Trustee, Paying Agent, Registrar and Transfer Agent,
hereunder and under the Construction Loan Documents to which it is a party. The
Trustee's compensation shall not be limited by any law on compensation of a
trustee of an express trust. The Issuer shall reimburse the Trustee upon request
for all reasonable out-of-pocket expenses incurred or made by it, including
costs of collection, in addition to the compensation to the Trustee for its
services. Such expenses shall include, but will not be limited to, the
reasonable compensation and expenses, disbursements and advances of the
Trustee's agents (including any receiver), delegates, counsel, accountants and
experts. The Issuer shall indemnify the Trustee against any and all loss,
liability or expense (including reasonable attorney's fees) incurred by it in
connection with the administration of this trust and the performance of its
duties hereunder or under the Construction Loan Documents including the costs
and expenses of defending against any claim or liability in connection with the
exercise or performance of any powers or duties hereunder and thereunder. The
Trustee shall notify the Issuer promptly of any claim for which it may seek
indemnity. Failure by the Trustee to so notify the Issuer shall not relieve the
Issuer of its obligations hereunder. The Issuer need not reimburse any expense
or indemnity against any loss, liability or expense incurred by the Trustee
through the Trustee's own willful misconduct, negligence or bad faith unless the
act in question has been directed pursuant to this Indenture. To the extent the
Trustee renders services or incurs expenses after an Event of Default involving
a bankruptcy, insolvency or the like, the compensation for services and expenses
incurred by it are intended to constitute expenses of administration under any
applicable federal, state or foreign bankruptcy, insolvency or other similar law
now or hereafter in effect.
(1) Indemnification by the Insurer. The Insurer shall
indemnify and hold the Trustee harmless from and against any and all loss,
damage, liability, cost and expense (including, without limitation, reasonable
attorney's fees and disbursements) incurred by the Trustee, any of its
Affiliates, or any of their respective officers, directors, shareholders,
employees and agents, arising out of or in connection with any action taken by
the Trustee under or pursuant to this Indenture, the Construction Loan Agreement
or any of the other Construction Documents in accordance with or pursuant to
written directions from the Insurer after the occurrence and during the
continuance of an Event of Default.
(2) The Issuer's and the Insurer's payment obligations to the
Trustee pursuant to this Section 5.7 shall survive the resignation or removal of
the Trustee, the occurrence of any Policy Event, the payment in full of all the
Notes, and the termination or discharge of any Basic Document or Construction
Loan Document, and shall not be affected by any obligation which Issuer, the
Insurer and the Trustee may have to provide indemnification under this
Agreement.
SECTION 1.35 Replacement of Trustee. (a) No resignation or removal of
the Trustee, and no appointment of a successor Trustee, shall become effective
until the acceptance of appointment by the successor Trustee pursuant to this
Section 5.8. The Trustee may resign at any time upon not less than sixty (60)
calendar days prior written notice to the Issuer and the Insurer. So long as no
Event of Default has occurred and is continuing the Issuer may remove the
Trustee without cause by so notifying the Trustee; provided, however, if no
Policy Event has occurred and is continuing, such removal shall require the
consent of the Insurer. If an Event of Default has occurred and is continuing,
the Insurer, so long as no Policy Event has occurred and is continuing, or the
Holders of 662/3% of the Outstanding Principal Amount of the Notes, if a Policy
Event has occurred or is continuing, may remove the Trustee without cause by so
notifying the Trustee and the Issuer. The Issuer shall remove the Trustee
promptly if:
(1) the Trustee fails to comply with Section 5.10;
(2) the Trustee is adjudged to be bankrupt or
insolvent;
(3) a receiver or other public officer takes charge
of the Trustee or its property; or
(4) the Trustee otherwise becomes incapable of
acting.
If the Trustee resigns or is removed or if a vacancy exists in the office of
Trustee for any reason (the Trustee in such event being referred to herein as
the retiring Trustee), (i) so long as no Event of Default has occurred and is
continuing, the Issuer shall promptly appoint a successor Trustee, provided that
so long as no Policy Event has occurred and is continuing, the appointment of
any such successor Trustee shall be subject to the prior consent of the Insurer,
(ii) if an Event of Default has occurred and is continuing and no Policy Event
has occurred and is continuing, the Insurer shall appoint a successor Trustee,
or (iii) if an Event of Default has occurred and is continuing and a Policy
Event has occurred and is continuing, Holders of 662/3% of the Outstanding
Principal Amount of the Notes may appoint a successor Trustee.
(2) Any successor Trustee shall, without further act, be the
Trustee under the other Basic Documents and the Construction Loan Agreement, and
shall deliver a written acceptance of its appointment as Trustee (which shall
include acceptance of its appointment as the Agents and as Trustee under the
other Basic Documents and the Construction Loan Documents) to the retiring
Trustee and to the Issuer and the Insurer. Thereupon, the resignation or removal
of the retiring Trustee shall become effective, and the successor Trustee shall
have all the rights, powers and duties of the Trustee under this Indenture. The
successor Trustee shall mail a notice of its succession to the Noteholders. If
the retiring Trustee resigns or is removed, and the Issuer, the Insurer or the
requisite Holders fail to appoint a successor Trustee as provided herein, the
retiring Trustee, the Issuer, the Insurer or the Holders of greater than 50% of
the Outstanding Principal Amount of the Notes may petition any court of
competent jurisdiction for the appointment of a successor Trustee. If the
Trustee fails to comply with Section 5.10, any Noteholder may petition any court
of competent jurisdiction for the removal of the Trustee and the appointment of
a successor Trustee.
(3) Notwithstanding the replacement of the Trustee pursuant to
this Section 5.8, the Issuer's obligations under Section 5.7 shall continue for
the benefit of the retiring Trustee.
SECTION 1.36 Successor Trustee by Merger. (a) If the Trustee
consolidates with, merges or converts into, or transfers all or substantially
all of its corporate trust business or assets to, another corporation or banking
association, the resulting, surviving or transferee corporation or banking
association without any further act shall be the successor Trustee; provided,
however, that such corporation or banking association shall be otherwise
qualified and eligible under Section 5.10. The Trustee shall provide the Rating
Agencies with written notice of any such transaction.
(1) In case at the time such successor or successors by
merger, conversion or consolidation to the Trustee shall succeed to the trusts
created by this Indenture any of the Notes shall have been authenticated but not
delivered, any such successor to the Trustee may adopt the Certificate of
Authentication of any predecessor trustee, and deliver such Notes so
authenticated, and in case at that time any of the Notes shall not have been
authenticated, any successor to the Trustee may authenticate such Notes either
in the name of any predecessor hereunder or in the name of the successor to the
Trustee. In all such cases such certificates shall have the full force which it
is anywhere in the Notes or in this Indenture provided that the certificate of
the Trustee shall have.
SECTION 1.37 Eligibility; Disqualification. The Trustee or its parent
shall have a combined capital and surplus of at least $250,000,000 as specified
in its most recent published annual report and shall have a long-term senior
unsecured debt rating of no lower than "BBB-" by S&P and "Baa3" by Xxxxx'x, or
shall otherwise be acceptable to the Rating Agencies.
SECTION 1.38 Unclaimed Funds. Subject to applicable laws with respect
to abandoned property, any funds held by the Trustee (as Trustee or as Paying
Agent) for the payment of principal (or the Make Whole Amount, as applicable) or
purchase price on any Note that remains unclaimed for five (5) years and for the
payment of interest (including interest which is a part of the purchase price)
and Additional Amounts on any Note that remain unclaimed for ten (10) years, in
each case, after such amount shall have become due and payable, shall be paid to
the Insurer to the extent of any unreimbursed or outstanding amounts paid by the
Insurer pursuant to the terms of the Policy and thereafter repaid to the Person
which originally paid such funds to the Trustee, and the Holder of such Note
shall thereafter look, as an unsecured general creditor, only to the Issuer,
Insurer or Purchaser (whichever was liable to make the payment being sought) for
payment thereof, and all liability of the Trustee with respect to such funds
shall thereupon cease. The Trustee shall also adopt and employ, at the expense
and direction of the Issuer, any other reasonable means of notification of such
repayment (including, but not limited to, mailing notice of such repayment to
the Holders whose Notes have been called but have not been surrendered for
redemption or purchase or whose right to or interest in monies due and payable
but not claimed is determinable from the records of the Trustee, at the last
address of record for each such Holder).
ARTICLE VI
NOTEHOLDERS' LISTS, REPORTS AND MEETINGS
SECTION 1.39 Preservation of Information; Communications to
Noteholders. The Trustee shall preserve in as current a form as is reasonably
practicable, the names and addresses of Holders of Global Notes received by the
Trustee in its capacity as Registrar.
SECTION 1.40 Voting by Noteholders. Except as otherwise provided in the
Indenture (including, without limitation, the provisions of Section 8.2) all
resolutions of the Noteholders shall be passed by votes representing more than
50% of the Outstanding Principal Amount.
SECTION 1.41 Purposes for Which Noteholder Meetings May Be Called. A
meeting of Noteholders may be called at any time and from time to time pursuant
to this Article VI to make, give or take any request, demand, authorization,
direction, notice, consent, waiver or other action provided by this Indenture to
be made, given or taken by the Noteholders.
SECTION 1.42 Call, Notice and Place of Meetings.
(1) The Trustee may at any time call a meeting of Noteholders
for any purpose specified in Section 6.3, to be held at such time and at such
place as the Trustee shall determine. Notice of every meeting of Noteholders,
setting forth the time and place of such meeting and in general terms the action
proposed to be taken at such meeting, shall be given by the Trustee, in the
manner provided in Section 11.4, not less than ten (10) nor more than 180
calendar days prior to the date fixed for the meeting.
(2) In case at any time the Issuer, pursuant to a resolution
of the managing member of the Issuer, or the Holders of at least 10% of the
Outstanding Principal Amount of the Notes shall have requested the Trustee to
call a meeting of the Noteholders for any purpose specified in Section 6.3, by
written request setting forth in reasonable detail the action proposed to be
taken at the meeting, and the Trustee shall not have made the first publication
of the notice of such meeting within ten (10) calendar days after receipt of
such request or shall not thereafter proceed to cause the meeting to be held as
provided herein, then the Issuer or the Noteholders in the amount above
specified, as the case may be, may determine the time and the place, for such
meeting and may call such meeting for such purposes by giving notice thereof as
provided in subsection (a) of this Section 6.4.
SECTION 1.43 Persons Entitled to Vote at Meetings.
To be entitled to vote at any meeting of the Noteholders a Person shall
(a) be a Holder of one or more of the outstanding Notes or (b) be a Person
appointed by an instrument in writing as proxy by a Holder of one or more Notes.
The only Persons who shall be entitled to be present or to speak at any meeting
of Noteholders shall be the Persons entitled to vote at such meeting and their
counsel and any representatives of the Trustee and its counsel, any
representatives of the Issuer and its counsel, and any representatives of the
Insurer and its counsel.
SECTION 1.44 Quorum; Action.
Persons entitled to vote at least 51% of the Outstanding Principal
Amount of the Notes shall constitute a quorum for a meeting of the Noteholders.
In the absence of a quorum within 60 minutes of the time appointed for any such
meeting, the meeting shall, if convened at the request of Noteholders, be
dissolved. In any other case the meeting may be adjourned for a period of not
less than ten (10) calendar days as determined by the chairman of the meeting
prior to the adjournment of such meeting. In the absence of a quorum at any such
adjourned meeting, such adjourned meeting may be further adjourned for a period
of not less than ten (10) calendar days as determined by the chairman of the
meeting prior to the adjournment of such adjourned meeting. Notice of the
reconvening of any adjourned meeting shall be given as provided in Section 12.4,
except that such notice need be given only once not less than five (5) calendar
days prior to the date on which the meeting is scheduled to be reconvened.
Notice of the reconvening of an adjourned meeting shall state expressly the
percentage, as provided above, of the Outstanding Principal Amount of the Notes
that shall constitute a quorum.
Except as limited by the proviso to the first paragraph of Section 8.2,
any resolution presented to a meeting or adjourned meeting duly reconvened at
which a quorum is present as aforesaid may be adopted by the affirmative vote of
the Holders of at least 51% of the Outstanding Principal Amount of the Notes;
provided, however, that, except as limited by the proviso to the first paragraph
of Section 8.2, any resolution with respect to any request, demand,
authorization, direction, notice, consent, waiver or other action that this
Indenture expressly provides may be made, given or taken by the Holders of a
specified percentage, which is less than 51% of the Outstanding Principal Amount
of the Notes, may be adopted at a meeting or an adjourned meeting duly
reconvened and at which a quorum is present as aforesaid by the affirmative vote
of the Holders of such specified percentage of the Outstanding Principal Amount
of the Notes.
Any resolution passed or decision taken at any meeting of Holders of
Notes duly held in accordance with this Article VI shall be binding on all the
Noteholders, whether or not present or represented at the meeting.
Notwithstanding the foregoing provisions of this Article VI, if any
action is to be taken at a meeting of Noteholders with respect to any request,
demand, authorization, direction, notice, consent, waiver or other action that
this Indenture expressly provides may be made, given or taken by the Holders of
a specified percentage in aggregate Outstanding Principal Amount of the Notes
affected thereby, or of the Noteholders:
(1) there shall be no minimum quorum requirement for such
meeting; and
(2) the aggregate Outstanding Principal Amount of the Notes
that vote in favor of such request, demand, authorization, direction, notice,
consent, waiver or other action shall be taken into account in determining
whether such request, demand, authorization, direction, notice, consent, waiver
or other action has been made, given or taken under this Indenture.
SECTION 1.45 Determination of Voting Rights; Conduct and Adjournment of
Meetings.
(1) Notwithstanding any other provisions of this Indenture,
the Trustee may make such reasonable regulations as it may deem advisable for
any meeting of Noteholders in regard to proof of the holding of the Notes and of
the appointment of proxies and in regard to the appointment and duties of
inspectors of votes, the submission and examination of proxies, certificates and
other evidence of the right to vote, and such other matters concerning the
conduct of the meeting as it shall deem appropriate. Except as otherwise
permitted or required by any such regulations, the holding of Notes shall be
proved in the manner specified in Section 2.5(m) and the appointment of any
proxy shall be proved in the manner specified in Section 2.5(m) or by having the
signature of the person executing the proxy witnessed or guaranteed by any trust
company, bank or banker authorized by Section 2.5(m). Such regulations may
provide that written instruments appointing proxies, regular on their face, may
be presumed valid and genuine without the proof specified in Section 2.5(m) or
other proof.
(2) The Trustee shall, by an instrument in writing, appoint a
chairman of the meeting, unless the meeting shall have been called by the Issuer
or by Holders of Notes as provided in Section 6.4, in which case the Issuer or
the Holders of Notes calling the meeting, as the case may be, shall in like
manner appoint a chairman. A permanent chairman and a permanent secretary of the
meeting shall be elected by vote of the Persons entitled to vote at least 51% of
the Outstanding Principal Amount of the Notes represented at the meeting.
(3) At any meeting each Noteholder or proxy shall be entitled
to one vote for each $1,000 of the Outstanding Principal Amount of the Notes
held or represented by him; provided, however, that no vote shall be cast or
counted at any meeting in respect of any Note challenged as not Outstanding and
ruled by the chairman of the meeting to be not Outstanding. The chairman of the
meeting shall have no right to vote, except as a Noteholder or of a proxy.
(4) Any meeting of Noteholders duly called pursuant to Section
6.4 at which a quorum is present may be adjourned from time to time by Persons
entitled to vote at least 51% of the Outstanding Principal Amount of the Notes
represented at the meeting; and the meeting may be held as so adjourned without
further notice.
SECTION 1.46 Counting Votes and Recording Action of Meetings.
The vote upon any resolution submitted to any meeting of Noteholders
shall be by written ballots on which shall be subscribed the signatures of the
Noteholders or their representatives by proxy and the Outstanding Principal
Amount and serial numbers of the Notes held or represented by them. The
permanent chairman of the meeting shall appoint two inspectors of votes who
shall count all votes cast at the meeting for or against any resolution and who
shall make and file with the secretary of the meeting their verified written
reports in duplicate of all votes cast at the meeting. A record, at least in
duplicate, of the proceedings of each meeting of Noteholders shall be prepared
by the secretary of the meeting and there shall be attached to said record the
original reports of the inspectors of votes on any vote by ballot taken thereat
and affidavits by one or more persons having knowledge of the facts setting
forth a copy of the notice of the meeting and showing that said notice was given
as provided in Section 6.4 and, if applicable, Section 6.8. Each copy shall be
signed and verified by the affidavits of the permanent chairman and secretary of
the meeting and one such copy shall be delivered to the Issuer, and another to
the Trustee to be preserved by the Trustee, the latter to have attached thereto
the ballots voted at the meeting. Any record so signed and verified shall be
conclusive evidence of the matters therein stated.
ARTICLE VII
ACCOUNTS, COLLECTIONS AND DISBURSEMENTS
SECTION 1.47 Collection and Disbursements of Money.
(1) All moneys paid to or collected by the Trustee under or
pursuant to the Notes, the Construction Loan Agreement, the Construction Loan
Deed of Trust, any interest rate protection agreement or any other Construction
Loan Document (including proceeds collected by the Trustee upon the sale or
other disposition of Collateral or upon the exercise of any remedies under the
Construction Loan Documents, but excluding moneys collected under the Completion
Guaranty or the Payment Guaranty), after making any payments required pursuant
to Section 2.3(f) of the Construction Loan Agreement, shall be deposited in the
Payment Account for application in accordance with this Indenture. All moneys
paid to or collected by the Trustee under the Policy, the Assignment of
Reinsurance and the Reinsurance Agreement, shall be deposited by the Trustee in
the Policy Payment Account for application in accordance with this Indenture.
All moneys paid to or collected by the Trustee under the Completion Guarantee
and the Payment Guarantee, after making any payments required pursuant to
Section 2.3(f) of the Construction Loan Agreement, shall be deposited by the
Trustee in the Guarantee Payment Account for application in accordance with this
Indenture. All moneys paid to the Trustee pursuant to Section 9.2(b) by a
Purchaser, after making any payments required pursuant to Section 2.3(f) of the
Construction Loan Agreement, shall be deposited by the Trustee in the Note
Purchase Account for application in accordance with this Indenture.
(2) On each Interest Payment Date, Payoff Date, Default
Payment Date and on the Stated Maturity Date the Trustee will pay the following
amounts then held in the Accounts in the following order of priority (the
"Priority of Payments"):
(1) first, out of the Payment Account and the
Purchase Account only, to the Trustee for all amounts due to the
Trustee in each of its capacities hereunder, including all amounts due
under Section 5.7, and for all amounts due to the Trustee pursuant to
the Construction Loan Documents and for any amounts due to a Special
Construction Servicer appointed pursuant to Section 4.6;
(2) second, out of the Payment Account and the
Purchase Account only, to the Insurer for all amounts due to the
Insurer in both its capacities as Insurer and Administrative Agent
under this Indenture and the Construction Loan Documents, including
indemnification and reimbursement of costs and expenses, but exclusive
of the amounts referred to in clauses fifth, sixth and seventh below;
(3) third, to the Holders of the Notes the amounts of interest
and Additional Amounts due and unpaid with respect to the Notes, and any
interest at the Default Rate, from the due date thereof until the date paid to
the Noteholders;
(4) fourth, to the Holders of the Notes the amounts of
principal (or, if applicable, Make Whole Amount) due and unpaid with respect to
the Notes;
(5) fifth, to the Insurer the amount of all payments made
under the Policy and the Swap Policy which have not been reimbursed to, or
collected by, the Insurer;
(6) sixth, to the Insurer the amount of any interest at the
Default Rate (to the extent not required to be paid under clause third above)
and Late Payment Fees paid by the Issuer or for the Issuer's account under the
Construction Loan Agreement and not previously paid to the Insurer pursuant to
this clause sixth and the amount of interest at the Default Rate and Late
Payment Fees then due and unpaid under the Construction Loan Agreement;
(7) seventh, to the Insurer all amounts due and unpaid under
or pursuant to the Policy and the Swap Policy;
(8) eighth, to the Trustee amounts necessary to enable the
Trustee to pay, repay, or reimburse third parties for amounts expended on Costs;
(9) ninth, if no Event of Default has occurred and is
continuing to the Issuer, the Insurer, the Guarantor or a Purchaser, as the case
may be, the amounts set forth in Section 7.3(a); and
(10) tenth, if the conditions set forth in Section 12.19 to
the satisfaction and discharge of this Indenture have been satisfied, the
balance in the Accounts to the Issuer or such other Person as may be legally
entitled thereto or as may be ordered or directed by a court of competent
jurisdiction.
Notwithstanding the foregoing, if an Event of Default has occurred and
is continuing and the Trustee receives proceeds from the sale or other
disposition of the Collateral or upon the exercise of remedies under or pursuant
to the Construction Loan Documents, no payments from such proceeds shall be made
pursuant to clause fifth of this Section 7.1(b) until the Outstanding Principal
Amount of, accrued and unpaid interest on, and Additional Amounts, if any, with
respect to the Notes have been paid in full.
Notwithstanding anything in this Indenture to the contrary, all
payments made by the Reinsurer under the Assignment of Reinsurance, the
Assignment of Reinsurance (Swap), the Reinsurance Agreement or the Swap
Reinsurance Agreement and all amounts due to the Reinsurer pursuant to any
thereof, respectively, for all purposes of this Indenture, including
specifically this Section 7.1(b) and Section 12.19, shall be deemed to have been
made by the Insurer under the Policy or the Swap Policy, and shall be deemed due
to the Insurer under the Policy or the Swap Policy, respectively.
SECTION 1.48 The Accounts. On or prior to the Closing Date, the Trustee
shall establish and thereafter maintain the Accounts at an Eligible Institution.
The Accounts shall initially be held at Bank One, National Association. If any
Eligible Institution ceases to be an Eligible Institution, the Issuer shall
choose another Eligible Institution, which Eligible Institution shall be
reasonably acceptable to the Insurer (so long as no Policy Event shall have
occurred and be continuing) to hold the Accounts, and shall direct the Trustee
in writing to transfer the Accounts to such Eligible Institution, and the
Trustee shall cause the Accounts to be transferred to such Eligible Institution.
All amounts deposited in the Accounts shall be held for the benefit of the
Noteholders. The only permitted withdrawal from or application of funds on
deposit in, or otherwise to the credit of, the Accounts, shall be in accordance
with the provisions of this Indenture. The Trustee agrees to give the Issuer,
the Insurer, the Guarantor, the Purchasers and the Noteholders prompt notice if
any of the Accounts any funds on deposit therein, or otherwise to the credit
thereof, shall become subject to any writ, order, judgment, warrant of
attachment, execution or similar process.
SECTION 1.49 General Provisions Regarding Accounts. (a) Any funds held
in an Account shall be invested by the Trustee in Permitted Investments at the
written direction of the Person which made the payment to the Trustee of the
funds to be so invested; provided, however, that (i) if an Event of Default
shall have occurred and is continuing and no Policy Event has occurred and is
continuing, such funds shall be invested in Permitted Investments at the written
direction of the Insurer, or (ii) if an Event of Default has occurred and is
continuing and a Policy Event has occurred and is continuing, or, if no
Permitted Investment has been designated in writing to the Trustee by the party
having the right to make such designation, such funds shall be invested in the
One Group Prime Institutional Fund. If no Event of Default has occurred and
continuing, on each Interest Payment Date, Payoff Date and on the Stated
Maturity Date all income or other gain (net of losses and investment expenses)
from investments of monies deposited in the Accounts, shall be withdrawn by the
Trustee from such account and remitted to the Issuer, the Insurer, the Guarantor
or a Purchaser, whichever made the payment to the Trustee of the funds so
deposited in the Accounts, pursuant to clause (ix) of the Priority of Payments,
to the extent of the funds on deposit in the relevant Account after the payments
required to be made pursuant to clauses (i) through (viii) of the Priority of
Payments are made. If any investment of funds in an Account results in a loss
such that the amount remaining on deposit will not be sufficient to pay in full,
when due, the amounts for which the deposit of such funds was made, the Person
which made the payment to the Trustee of the funds shall immediately pay to the
Trustee an amount sufficient to pay in full, when due, such amounts for which
the deposit was made, and if such additional amount is paid to the Trustee prior
to the due date of the payment to be made with such funds, the existence of such
deficiency shall not constitute an Event of Default notwithstanding any
provision in the Construction Loan Documents to the contrary.
(b) The Trustee shall not in any way be held liable by reason
of any insufficiency in the Accounts, resulting from any loss on any Permitted
Investment included therein acquired at the direction of the Issuer, the
Insurer, the Guarantor or a Purchaser pursuant to clause (a) of this Section
7.3.
SECTION 1.50 Payment of Accounts Balances. At such time as the
principal of, interest on and all other amounts due with respect to the Notes,
and all amounts due to any other Person pursuant to this Indenture and the
Policy have been indefeasibly paid in full, the Trustee shall withdraw from the
Accounts any moneys then on deposit therein and disburse such moneys as follows:
if from the (i) Payment Account, to the Issuer, (ii) the Policy Payment Account,
to the Insurer, (iii) the Note Purchase Account, to the Purchaser, and (iv) the
Guarantee Payment Account, to the Guarantor.
ARTICLE VIII
SUPPLEMENTAL INDENTURES
SECTION 1.51 Supplemental Indentures Without Consent of Noteholders.
Without the consent of the Noteholders, but with prior notice to the Rating
Agencies, the Issuer, the Insurer (so long as no Policy Event has occurred and
is continuing) and the Trustee, when authorized by an Issuer Order, at any time
and from time to time, may enter into one or more indentures supplemental
hereto, in form satisfactory to the Trustee, for any of the following purposes:
(1) to evidence the succession, in compliance with the
applicable provisions hereof, of another Person to the Issuer, and the
assumption by any such successor of the covenants of the Issuer herein and in
the Notes;
(2) to add to the covenants of the Issuer, for the benefit of
the Insurer and the Noteholders, or to surrender any right or power herein
conferred upon the Issuer;
(3) to convey, transfer, assign, mortgage or pledge any
additional property to or with the Trustee;
(4) to cure any ambiguity, to correct or supplement any
provision herein or in any supplemental indenture that may be inconsistent with
any other provision herein or in any supplemental indenture or to make any other
provisions with respect to matters or questions arising under this Indenture
which will not be inconsistent with other provisions of the Indenture; or
(5) to evidence and provide for the acceptance of the
appointment hereunder by a successor trustee with respect to the Notes and to
add to or change any of the provisions of this Indenture as shall be necessary
to facilitate the administration of the trusts hereunder by more than one
trustee, pursuant to the requirements of Article V;
provided, however, that (i) such action shall not, as evidenced by an Opinion of
Counsel, adversely affect the interests of any Noteholder; (ii) the Rating
Agency Condition shall have been satisfied with respect to such action and (iii)
any additional property Environmental Report reasonably requested by the Trustee
(if any additional real property is conveyed, transferred, assigned, mortgaged
or pledged to or with the Trustee) shall have been received and shall be
reasonably satisfactory to the Trustee. The Trustee is hereby authorized to join
in the execution of any such supplemental indenture and to make any further
appropriate agreements and stipulations that may be therein specified.
SECTION 1.52 Supplemental Indentures with Consent of Noteholders. The
Issuer, the Insurer and the Trustee, when authorized by an Issuer Order, also
may (i) so long as a Policy Event has occurred and is continuing, with the
consent of the Holders of greater than 50% of the Outstanding Principal Amount
of the Notes affected thereby, or (ii) so long as no Policy Event has occurred
and is continuing, with the prior consent of the Insurer and without consent of
the Holders, enter into an indenture or indentures supplemental hereto for the
purpose of adding any provisions to, or changing in any manner or eliminating
any of the provisions of, this Indenture or modifying in any manner the rights
of the Holders of the Notes under this Indenture; provided that (x) the Rating
Agency Condition shall have been satisfied with respect to such action and (y)
no such supplemental indenture shall, without the consent of the Holder of each
outstanding Note affected thereby:
(1) change the Stated Maturity Date, any Interest Payment Date
or any Payoff Date (or the dates on which a redemption or purchase is
permitted), or reduce the Outstanding Principal Amount, the interest rate (or
manner of calculation of the interest rate) or the Redemption/Purchase Deposit
Amount with respect to any Note, or change any time or place of payment where,
or the coin or currency in which, any principal (or the Make Whole Amount, as
applicable) of, interest on or Additional Amounts with respect to any Note is
payable (or modify the definition of "Additional Amounts" or "Make Whole
Amount"), or impair the right to institute suit for the enforcement of the
provisions of this Indenture requiring the application of funds available
therefor, as provided in Article IV, to the payment of any such amount due on
the Notes on or after the respective due dates thereof (or, in the case of
redemption on or after the Redemption Date or, in the case of a purchase of the
Notes by Marriott, on or after the Purchase Date);
(2) reduce the percentage of the Outstanding Principal Amount
of the Notes the consent of the respective Noteholders of which is required for
any such supplemental indenture, or the consent of the respective Noteholders of
which is required for any waiver of future compliance with certain provisions of
this Indenture or certain past defaults hereunder and their consequences
provided for in this Indenture;
(3) modify any provision of this Indenture specifying a
percentage of the aggregate Outstanding Principal Amount of the Notes necessary
to amend this Indenture;
(4) modify any of the provisions of this Indenture in such
manner as to affect the calculation of any amounts of principal or interest due
with respect to the Notes, or the manner or method of calculating such amounts;
(5) change the dates upon which optional redemption or
purchase of the Notes is permitted; or
(6) release the Insurer from all or any part of its
obligations under or with respect to the Policy or release the Reinsurer from
all or any part of its obligations under or with respect to the Assignment of
Reinsurance or the Reinsurance Agreement.
It shall not be necessary for any act of the Noteholders under this
Section 8.2 to approve the particular form of any proposed supplemental
indenture, but it shall be sufficient if such Act shall approve the substance
thereof.
Promptly after the execution by the Issuer, the Insurer and the Trustee
of any supplemental indenture pursuant to this Section 8.2, the Trustee shall
mail to the Guarantor and the Holders of the Notes to which such amendment or
supplemental indenture relates a notice setting forth in general terms the
substance of such supplemental indenture. Any failure of the Trustee to mail
such notice, or any defect therein, shall not, however, in any way impair or
affect the validity of any such supplemental indenture.
SECTION 1.53 Execution of Supplemental Indentures. In executing, or
permitting the additional trusts created by, any supplemental indenture
permitted by this Article VIII or the modification thereby of the trusts created
by this Indenture, the Trustee shall be entitled to receive, and subject to
Sections 6.1 and 6.2, shall be fully protected in relying upon, an Opinion of
Counsel stating that the execution of such supplemental indenture is authorized
or permitted by this Indenture and that all conditions precedent to the
execution and delivery of such supplemental indenture have been satisfied. The
Trustee may, but shall not be obligated to, enter into any such supplemental
indenture that affects the Trustee's own rights, duties, liabilities or
immunities under this Indenture or otherwise.
SECTION 1.54 Effect of Supplemental Indenture. Upon the execution of
any supplemental indenture pursuant to the provisions hereof, this Indenture
shall be and shall be deemed to be modified and amended in accordance therewith
with respect to the Notes affected thereby, and the respective rights,
limitations of rights, obligations, duties, liabilities and immunities under
this Indenture of the Trustee, the Issuer, the Insurer and the Holders of the
Notes shall thereafter be determined, exercised and enforced hereunder subject
in all respects to such modifications and amendments, and all the terms and
conditions of any such supplemental indenture shall be and be deemed to be part
of the terms and conditions of this Indenture for any and all purposes.
SECTION 1.55 Reference in Notes to Supplemental Indentures. Notes
authenticated and delivered after the execution of any supplemental indenture
pursuant to this Article VIII may, and if required by the Issuer or the Insurer
shall, bear a notation in form approved by the Trustee as to any matter provided
for in such supplemental indenture. If the Issuer or the Trustee shall so
determine, new Notes so modified as to conform, in the opinion of the Trustee
and the Issuer, to any such supplemental indenture may be prepared and executed
by the Issuer, and upon Issuer Order authenticated and delivered by the Trustee
in exchange for Outstanding Notes.
ARTICLE IX
REDEMPTION OF NOTES; PURCHASE OF NOTES; DEFEASANCE
SECTION 1.56 Redemption. (a) On any date on which the Issuer makes a
prepayment of the Construction Loan, in whole or in part, pursuant to the
Construction Loan Agreement (a "Prepayment Date"), principal of the Notes in an
amount equal to the principal of the Construction Loan so prepaid shall be
redeemed in accordance with this Article IX.
(1) If the Issuer has elected to defease the Construction Loan
pursuant to the Construction Loan Agreement and the Issuer has delivered to the
Trustee for deposit in the Payment Account the Defeasance Collateral, on the
first Business Day following the Four-Year Date (also a "Defeasance Redemption
Date"), the Notes shall be redeemed in whole pursuant to this Article IX. If the
Trustee has required the Issuer to defease the Construction Loan pursuant to the
Construction Loan Agreement and the Issuer has delivered to the Trustee for
deposit in the Payment Account the Defeasance Collateral, on the first Business
Day following the Two-Year Date (also a "Defeasance Redemption Date"), the Notes
shall be redeemed in whole pursuant to this Article IX.
(c) In the event that, after the Defeasance Collateral has
been delivered to the Trustee prior to the Two-Year Date or Four-Year Date, as
applicable, an event occurs which would require the payment of any Additional
Amounts on the Notes (the payment of which is not provided for in the Defeasance
Collateral), then the Trustee promptly shall give notice of redemption to the
Noteholders. The date of redemption shall be the first Business Day following
the 30th calendar day after the Trustee gives such redemption notice. On such
Redemption Date, the Issuer shall redeem the entire Outstanding Principal Amount
of the Notes in accordance with this Article IX.
SECTION 1.57 Purchase. (a) On any date on or after the Four-Year Date
Marriott may purchase the Notes in whole but not in part. On any date on or
after the Two-Year Date, (i) if an Event of Default has occurred and is
continuing, Marriott may purchase the Notes, in whole but not in part, and (ii)
if Marriott has not previously elected to purchase the Notes and any payment has
been made pursuant to the Policy, the Swap Policy, the Reinsurance Agreement or
the Swap Reinsurance Agreement on account of a claim made thereunder, the
Insurer or the Reinsurer may purchase the Notes, in whole but not in part (the
party electing to purchase the Notes under the preceding sentence or clause (i)
or (ii) above being referred to as the "Purchaser"). In addition, if the Insurer
or the Reinsurer elects to purchase the Notes under clause (ii) above, within
ten (10) calendar days after receipt of notice from the Insurer or the
Reinsurer, Marriott may instead elect to purchase the Notes under clause (i)
above, which election by Marriott will supersede the election by the Insurer or
the Reinsurer under clause (ii) above. Any election to purchase the Notes will
be made by delivery from the Purchaser to the Trustee and to the Insurer (in the
case of the first sentence of this Section 9.2(a) or clause (i) above) or
Marriott (in the case of clause (ii) above) of written notice thereof (a
"Purchase Notice"). A Purchase Notice shall be delivered at least 35 (or fewer,
but not less than 30, with the consent of the Trustee) calendar days and not
more than 95 calendar days prior to the date upon which a purchase will occur,
which notice shall be irrevocable. The purchase price of the Notes shall be as
set forth in Section 9.3(a).
(1) If the Purchaser is Marriott, simultaneously with the
giving of a Purchase Notice, such Purchaser shall deliver to the Trustee for
deposit into the Note Purchase Account the Redemption/Purchase Deposit Amount,
and no Purchase Notice from such Purchaser shall be deemed to be effective
unless and until such funds have been deposited. If the Insurer is the
Purchaser, the Insurer shall deliver to the Trustee for deposit in the Note
Purchase Account by 11:00 a.m. New York City Time on the Payoff Date an amount
equal to the Outstanding Principal Amount of, accrued and unpaid interest on,
and due and unpaid Additional Amounts with respect to the Notes as of the Payoff
Date.
SECTION 1.58 Mechanics of Redemption or Purchase.
(1) If the Notes are to be redeemed in whole, the redemption
price shall be 100% of the Outstanding Principal Amount of the Notes (or the
Make Whole Amount of the Fixed Rate Notes, if applicable) plus accrued and
unpaid interest thereon and any due and unpaid Additional Amounts with respect
thereto as of the Payoff Date. If the Notes are to be redeemed in part, the
redemption price shall be 100% of the portion of the Outstanding Principal
Amount of the Notes (or the Make Whole Amount of the Fixed Rate Notes, if
applicable) to be redeemed plus accrued and unpaid interest on and any due and
unpaid Additional Amounts with respect to the amount being redeemed as of the
Payoff Date. If the Notes are being purchased by Marriott, the purchase price
shall be 100% of the Outstanding Principal Amount of the Notes (or the Make
Whole Amount of the Fixed Rate Notes, if applicable) plus accrued and unpaid
interest and any due and unpaid Additional Amounts as of the Payoff Date. If the
Notes are being purchased by the Insurer, the purchase price shall be 100% of
the Outstanding Principal Amount of the Notes (and not the Make Whole Amount of
the Fixed Rate Notes), plus accrued interest and unpaid Additional Amounts as of
the Payoff Date.
(2) If the Notes are to be partially redeemed, a ratable
portion of each Note outstanding on the Payoff Date shall be redeemed.
(3) In the case of (i) a redemption pursuant to Section 9.1(a)
or a purchase pursuant to Section 9.2, not more than five (5) calendar days
following receipt of the Redemption Notice or the Purchase Notice, as the case
may be, (ii) a redemption following a defeasance, not less than thirty (30) days
prior to a Defeasance Redemption Date, or (iii) a redemption pursuant to Section
9.1(c), promptly after obtaining knowledge of the event requiring payment of
Additional Amounts, the Trustee shall give notice of the redemption or purchase
to the Noteholders and the Insurer, such notice to be in the form of Notice of
Redemption/Purchase attached hereto as Exhibit I-1.
(4) Payments to the Noteholders in connection with a
redemption or purchase of the Notes will be made pursuant to Section 7.1(b)
hereof, provided, however, and notwithstanding the provisions of Section 7.1(b),
(i) if the Notes are to be redeemed, each Noteholder, as a condition to
receiving payment under Section 7.1(b), shall surrender such Noteholder's Note
to the Trustee for cancellation at the location specified in the Redemption
Notice or (ii) if the Notes are to be purchased, each Noteholder, as a condition
to receiving payment pursuant to Section 7.1(b), shall surrender such
Noteholder's Note to the Trustee at the location specified in the Purchase
Notice duly endorsed for transfer to the Purchaser. Further, notwithstanding the
provisions of Section 7.1(b), if the funds required to be paid to the Trustee by
the Issuer or a Purchaser have been so paid and deposited in the Payment Account
or Note Purchase Account, as the case may be, if any Noteholder is not paid
because such Noteholder failed to satisfy the condition specified in the
preceding sentence, the amount due to such Noteholder shall be retained in the
appropriate Account until the condition is satisfied and such amount is paid to
such Noteholder (and the retention of such amount in such Account shall be taken
into account by the Trustee in making payments and all subsequent payments
pursuant to the Priority of Payments).
(5) If the Notes are redeemed by the Issuer, in whole or in
part, all Notes delivered to the Trustee for cancellation shall be cancelled by
the Trustee, provided, however, if any Note is redeemed in part, upon surrender
of such Note to the Trustee for cancellation, the Issuer shall execute and the
Trustee shall authenticate and deliver to the Holder of such Note a new Note in
a principal amount equal to the unredeemed portion of such Note. If the Notes
are purchased by the Purchaser, the Notes will remain outstanding and thereafter
the Purchaser will be the Holder thereof. Notwithstanding anything herein to the
contrary, upon the purchase of the Notes the Policy will terminate in accordance
with its terms, and the Purchaser (rather than the Insurer) will have all of the
rights and powers, granted to the Insurer pursuant to this Indenture (including
Section 12.2) and shall have the same rights and benefits as the Insurer
pursuant to this Indenture (including Sections 12.3 and 12.4).
(6) If the Notes are to be purchased and the Purchaser has
paid the Redemption/Purchase Deposit Amount to the Trustee pursuant to Section
9.2(b), on the Payoff Date the Notes shall be deemed to have been transferred to
the Purchaser (whether or not Holders have delivered their Notes duly endorsed
for transfer as required by Section 9.3(c)), from and after the Payoff Date the
Holders' only rights with respect to the Notes shall be to receive payment
therefor from the Trustee pursuant to Section 7.1(b), and the Trustee shall take
all actions necessary to register the Notes in the name of the Purchaser.
SECTION 1.59 Form of Redemption Notice or Purchase Notice. Redemption
Notices shall be in the form and contain the information required by the
Construction Loan Agreement. Purchase Notices shall state the Payoff Date and
the Redemption/Purchase Deposit Amount as of such Payoff Date.
SECTION 1.60 Notes Payable on Payoff Date. In the case of a redemption,
the principal amount of the Notes to be redeemed shall become due and payable on
the Payoff Date specified in the Redemption Notice and interest shall cease to
accrue on the amount to be redeemed from and after such Payoff Date. From and
after the Payoff Date the Notes or portions thereof redeemed shall cease to be
outstanding for all purposes, and the Holders' rights shall be limited to
receiving payment therefor, together with any Additional Amounts, in accordance
with this Indenture.
SECTION 1.61 Defeasance.
(1) If the Issuer elects or is required to defease the Notes
pursuant to the Construction Loan Agreement and delivers the Defeasance
Collateral and the Make Whole Hedge to the Trustee, the Defeasance Collateral
shall be deposited in the Payment Account and disbursed in accordance with
Section 7.1(b). In addition, the Trustee shall deposit in the Payment Account
all amounts received pursuant to the Make Whole Hedge in the Payment Account.
The Trustee shall call the Notes for redemption on the Defeasance Redemption
Date and, on such date, shall make the payments from the Payment Account as
specified in Section 7.1(b).
(2) In order to ensure that the amount deposited pursuant to
Section 9.6(a) above is sufficient to pay any applicable Make Whole Amount on
the Fixed Rate Notes, the Issuer shall enter into (and pre-fund) one or more
interest rate hedging arrangements (a "Make Whole Hedge") with a counterparty or
counterparties having long-term debt ratings at least equal to "AA-" by S&P and
"Aa3" by Xxxxx'x. The Issuer shall remain liable for any shortfall on such
deposit and for any Additional Amounts that become payable on the Notes.
(3) Notwithstanding the deposit of the Defeasance Collateral,
the entering into and pre-funding of the Make Whole Hedge and the application of
such Defeasance Collateral and the proceeds of the Make Whole Hedge as provided
herein and in the Construction Loan Agreement, the Insurer shall remain liable
for the payment of the entire Principal Amount of the Notes at the Stated
Maturity Date, and interest when due in accordance with the terms of the Policy
SECTION 1.62 Release of Collateral. If the Issuer has delivered a
Notice of Redemption for a redemption of the Notes in whole and has paid the
Redemption/Purchase Deposit Amount to the Trustee for deposit in the Payment
Account, or the Issuer has elected or is required to fund the cash collateral
account as described in Section 9.6 above and the Construction Loan Agreement
and has delivered the Defeasance Collateral and the Make Whole Hedge to the
Trustee, upon receipt of an Issuer Request and an Opinion of Counsel, the
Trustee shall take or cause to be taken, at the Issuer's sole cost and expense,
all action to release all of the Liens on and security interests in the
Collateral as provided in the Construction Loan Agreement and, at the Issuer's
sole cost and expense, shall execute and deliver all documents reasonably
requested by the Issuer to accomplish such release. Notwithstanding the delivery
of the Defeasance Collateral and the Make Whole Hedge to the Trustee by the
Issuer and the release of the Collateral to the Issuer pursuant to this Section
9.7, the Issuer shall remain liable with respect to any Additional Amounts that
become due with respect to the Notes, as provided in the Construction Loan
Agreement.
ARTICLE X
OBLIGATIONS ABSOLUTE
SECTION 1.63 Issuer's Obligations Absolute. Nothing contained in this
Indenture shall impair, as between the Issuer, the Guarantor, the Insurer and
the Trustee, the obligation of the Issuer to pay to the Trustee all amounts due
and payable under or pursuant to the Construction Loan Agreement, the
Construction Loan Deed of Trust and the other Construction Loan Documents as and
when the same shall become due and payable in accordance with the terms thereof,
or prevent the Trustee or the Insurer from exercising all rights, powers and
remedies otherwise permitted by this Indenture, any of the other Basic Documents
or the Construction Loan Documents (including the Construction Loan Agreement
and the Construction Loan Deed of Trust).
ARTICLE XI
THE INSURER
SECTION 1.64 Effect of Payment by Insurer; Subrogation. THE ISSUER
EXPRESSLY ACKNOWLEDGES AND AGREES THAT THE OBLIGATIONS OF THE ISSUER UNDER THIS
INDENTURE, THE NOTES, THE CONSTRUCTION LOAN AGREEMENT, INCLUDING THE PAYMENT OF
THE PRINCIPAL OF, AND INTEREST ON AND ADDITIONAL AMOUNTS WITH RESPECT TO, THE
NOTES, THE CONSTRUCTION LOAN DEED OF TRUST AND THE OTHER CONSTRUCTION LOAN
DOCUMENTS ARE OWED TO, AND ARE FOR THE BENEFIT OF THE TRUSTEE (ON BEHALF OF THE
NOTEHOLDERS AND THE INSURER) AND NO PAYMENT MADE PURSUANT TO THE POLICY THE
ASSIGNMENT OF REINSURANCE, OR THE REINSURANCE AGREEMENT ON ACCOUNT OF PRINCIPAL
OR INTEREST ON THE NOTES OR ANY OTHER AMOUNT DUE TO THE NOTEHOLDERS SHALL
MODIFY, AMEND, DIMINISH OR EXTINGUISH ANY AMOUNTS DUE FROM THE ISSUER TO THE
TRUSTEE, OR OTHERWISE AFFECT THE OBLIGATIONS OF THE ISSUER OR THE RIGHTS AND
REMEDIES OF THE TRUSTEE UNDER THIS INDENTURE, THE NOTES, THE CONSTRUCTION LOAN
AGREEMENT, THE CONSTRUCTION LOAN DEED OF TRUST OR ANY OTHER CONSTRUCTION LOAN
DOCUMENT. In addition to any other rights granted to the Insurer pursuant to the
terms of this Indenture, the Issuer and the Trustee acknowledge that, without
the need for any further action on the part of the Insurer, the Issuer, the
Trustee or any other Person, to the extent payments are made with monies
received pursuant to the Policy, the Reinsurance Policy or the Assignment of
Reinsurance on account of principal of or interest on the Notes or any
Additional Amounts to the Noteholders, the Insurer will be fully subrogated to
the rights of the Noteholders to receive such amounts of principal, interest and
Additional Amounts; provided, however, that to the extent such payment is
derived from the sources and in the manner provided herein for the payment of
such principal, interest or Additional Amounts, the Insurer shall be paid, in
each case, only after the Noteholders have received payments as provided in
Section 7.1(b).
SECTION 1.65 Rights of the Insurer.
(1) So long as no Policy Event has occurred and is continuing,
to the extent that (i) the Trustee in its capacity as Trustee under this
Indenture or (ii) the Trustee under the Construction Loan Documents (including
the Construction Loan Agreement and the Construction Loan Deed of Trust) is
required to take any actions (other than the collection and payment of moneys in
accordance with the Construction Loan Documents), or grant any approvals,
consents or waivers pursuant to the Construction Loan Documents, the Trustee
will take such actions only at the direction of or with the prior approval of
the Insurer.
(2) Without limiting paragraph (a), so long as no Policy Event
has occurred and is continuing, the Trustee shall cooperate in all respects with
any request by the Insurer for action to preserve or enforce the Insurer's
rights or interests under this Indenture, including a request to institute
Proceedings for the collection of all amounts then payable under this Indenture
or the Construction Loan Documents and a request to enforce any judgment
obtained and collect the amount adjudged due.
(3) Without limiting paragraph (a), so long as no Policy Event
has occurred and is continuing, (i) the Insurer shall have all rights to direct
the Trustee to enforce all rights and exercise all remedies under the
Construction Loan Documents; (ii) no amendment, modification or waiver of any
term of this Indenture or the Construction Loan Documents shall be made without
the prior consent of the Insurer; (iii) the Trustee shall not be replaced
without the prior written consent of the Insurer; (iv) the Insurer shall have
the sole right to direct the time, method and place of conducting any Proceeding
for any remedy available to the Trustee or exercising any trust or power
conferred on the Trustee, and the Noteholders shall have no right or entitlement
to so direct the Trustee; and (v) no Noteholder shall have any right to
institute any Proceeding, judicial or otherwise, with respect to the
Construction Loan Documents, or for the appointment of a receiver or a trustee,
or for any other remedy under the Construction Loan Documents.
(4) Notwithstanding anything in this Indenture, the
Construction Loan Agreement or any other Construction Loan Document to the
contrary, at its option the Insurer, in its own name or in the name of the
Trustee, shall have the right , to the exclusion of the Trustee, to take any
action under this Indenture, the Construction Loan Agreement and each other
Construction Loan Document which the Trustee has the right to take pursuant to
the terms and provisions thereof, including the right to exercise all remedies
after the occurrence of a Default or Event of Default. If the Insurer elects or
is required to take any such action in the name of the Trustee, the Trustee
shall reasonably cooperate with the Insurer to facilitate the taking of such
action, which actions by the Trustee shall be covered by the indemnification
provided in Section 5.7.
(5) Each of the rights and remedies granted to the Insurer
pursuant to this Indenture and the Construction Loan Documents are granted to
the Insurer in its individual capacity as obligor under the Policy for the sole
benefit of the Insurer to facilitate any recovery to which the Insurer may be
entitled. No such grant contained herein or in any Construction Loan Document
shall in any way create or be deemed to create any duty to, or trust
relationship with, any Noteholder or the Trustee, and each Noteholder, by its
acceptance of a Note hereunder, acknowledges and agrees that the sole duties and
obligations of the Insurer to the Trustee for the benefit of the Noteholders
shall be specified in the Policy.
SECTION 1.66 Indemnification; Reimbursement of Costs. (a) The Issuer
agrees to indemnify and hold harmless the Insurer and Affiliates, shareholders,
directors, officers, employees and agents against any and all liabilities,
costs, expenses and losses (including reasonable attorneys fees and
disbursements) incurred by the Insurer in the performance of obligations and the
exercise of its rights and remedies hereunder or under the Construction Loan
Documents other than if caused by the gross negligence or willful misconduct of
the Insurer, including, without limitation, for any amounts of indemnification
paid to the Trustee pursuant to Section 5.7.
(1) The Issuer agrees to pay or reimburse the Insurer for all
costs and expenses, including reasonable attorneys fees and disbursements,
incurred by the Insurer in connection with this Indenture and the Construction
Loan Documents, and the transactions contemplated hereby or thereby, including
the reasonable fees and disbursements of consultants (including a construction
consultant), other experts and counsel.
SECTION 1.67 Liability of the Insurer. Unless specifically provided
otherwise in a Construction Loan Document, so long as the Insurer performs all
of its obligations under the Policy, the Insurer shall not be liable for taking
or failing to take any action delegated to the Insurer hereunder or under the
Construction Loan Documents.
SECTION 1.68 Consents. Unless specifically provided otherwise in a
Construction Loan Document, all actions by the Insurer hereunder, including the
giving or withholding of consents, may be taken by the Insurer in its sole and
absolute discretion.
SECTION 1.69 Substitution of Reinsurer. If, pursuant to Assumption of
Liability and Novation Endorsement to the Reinsurance Agreement, the Policy is
deemed novated and amended and the obligations of the Insurer thereunder are
assumed by the Reinsurer in substitution for the Insurer, the Reinsurer shall be
substituted for the Insurer hereunder, all references to the Insurer shall
thereafter refer to the Reinsurer, the Reinsurer shall have all of the rights,
duties and obligations that the Insurer had prior to such substitution,
including the right to receive all payments pursuant to Section 7.1(b) to be
made on account of periods beginning after such substitution, and all references
to the Policy shall mean the Policy as so amended. If the foregoing occurs, the
Issuer and the Trustee shall join with the Insurer and the Reinsurer in
executing and delivering any documents or instruments reasonably requested by
the Issuer, the Trustee, the Insurer or the Reinsurer to effectuate the intent
of this Section 11.6, including documents necessary to make the Reinsurer or
party to this Indenture. Notwithstanding the foregoing, the Insurer shall
continue to have the right to receive all payments under Section 7.1(b) on
account of payments made by the Insurer prior to such substitution or which
accrued to the benefit of the Insurer during periods prior to such substitution,
all indemnification payments under this Indenture and the Construction Loan
Documents for acts, events and occurrences prior to such substitution (even if
claims therefor are made after such substitution) in its capacity as Insurer and
Administrative Agent, and reimbursement of all costs and expenses that accrued
prior to such substitution.
SECTION 1.70 Notice of Failure to Pay Premiums. The Insurer shall give
the Issuer, the Trustee and the Guarantor prompt written notice of any failure
by the Issuer to pay premiums due with respect to the Policy, the Swap Policy,
the Reinsurance Agreement or the Swap Reinsurance Agreement.
ARTICLE XII
MISCELLANEOUS
SECTION 1.71 Compliance Certificates and Opinions, etc. Upon any
application or request by the Issuer to the Trustee to take any action under any
provision of this Indenture, the Issuer shall furnish to the Trustee and, if
applicable, the Insurer (a) an Officer's Certificate stating that all conditions
precedent, if any, provided for in this Indenture relating to the proposed
action have been complied with, (b) if required hereunder, an Opinion of Counsel
stating that in the opinion of such counsel all such conditions precedent, if
any, have been complied with and (c) if applicable, an Independent Certificate
from a firm of certified public accountants meeting the applicable requirements
of this Section 12.1, except that, in the case of any such application or
request as to which the furnishing of such documents is specifically required by
any provision of this Indenture, no additional certificate or opinion need be
furnished.
Every certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture shall include:
(1) a statement that each signatory of such certificate or
opinion has read or has caused to be read such covenant or condition and the
definitions herein relating thereto;
(2) a brief statement as to the nature and scope of the
examination or investigation upon which the statements made or opinions given in
such certificate or opinion are based;
(3) a statement that, in the opinion of each such signatory,
such signatory has made such examination or investigation as is necessary to
enable such signatory to express an informed opinion as to whether or not such
covenant or condition has been complied with; and
(4) a statement as to whether, in the opinion of each such
signatory, such condition or covenant has been complied with.
The Trustee and the Insurer may conclusively rely on and be fully
protected in acting in reliance on any such Officer's Certificate or Opinion of
Counsel without any further investigation on its parts as to any matter
specified therein.
SECTION 1.72 Form of Documents Delivered to Trustee. (a) In any case
where several matters are required to be certified by, or covered by an opinion
of, any specified Person, it is not necessary that all such matters be certified
by, or covered by the opinion of, only one such Person, or that they be so
certified or covered by only one document, but one such Person may certify or
give an opinion with respect to some matters and one or more other such Persons
as to other matters, and any such Person may certify or give an opinion as to
such matters in one or several documents.
(1) Any certificate or opinion of an Authorized Officer of the
Issuer may be based, insofar as it relates to legal matters, upon a certificate
or opinion of, or representations by, counsel, unless such officer knows, or in
the exercise of reasonable care should know, that the certificate or opinion or
representations with respect to the matters upon which such Officer Certificate
or opinion is based are erroneous. Any such certificate of an Authorized Officer
or Opinion of Counsel may be based, insofar as it relates to factual matters,
upon a certificate or opinion of, or representations by, an officer or officers
of the Issuer, stating that the information with respect to such factual matters
is in the possession of the Issuer, unless such officer or officers of the
Issuer or such counsel knows, or in the exercise of reasonable care should know,
that the certificate or opinion or representations with respect to such matters
are erroneous.
(2) Where any Person is required to make, give or execute two
or more applications, requests, comments, certificates, statements, opinions or
other instruments under this Indenture, they may, but need not, be consolidated
and form one instrument.
(3) Whenever in this Indenture, in connection with any
application or certificate or report to the Trustee, it is provided that the
Issuer shall deliver any document as a condition of the granting of such
application, or as evidence of the Issuer's compliance with any term hereof, it
is intended that the truth and accuracy, at the time of the granting of such
application or at the effective date of such certificate or report (as the case
may be), of the facts and opinions stated in such document shall in such case be
conditions precedent to the right of the Issuer to have such application granted
or to the sufficiency of such certificate or report. The foregoing shall not,
however, be construed to affect the Trustee's right to rely upon the truth and
accuracy of any statement made or opinion given in any such document as provided
in Article V.
SECTION 1.73 Acts of Noteholders. (a) Any request, demand,
authorization, direction, notice, consent, waiver or other action provided by
this Indenture to be given or taken by Noteholders may be embodied in and
evidenced by one or more instruments of substantially similar tenor signed by
such Noteholders in person or by agents duly appointed in writing; and except as
herein otherwise expressly provided such action shall become effective when such
instrument or instruments are delivered to the Trustee, and, where it is hereby
expressly required, to the Issuer. Such instrument or instruments (and the
action embodied herein and evidenced thereby) are herein sometimes referred to
as the "Act" of the Noteholders signing such instrument or instruments. Proof of
execution of any such instrument or of a writing appointing any such agent shall
be sufficient for any purpose of this Indenture and (subject to Section 5.1)
conclusive in favor of the Trustee and the Issuer, if made in the manner
provided in this Section 12.3.
(1) The ownership of the Notes shall be proved by the Note
Register.
(2) Any request, demand, authorization, direction, notice,
consent, waiver or other action by the Holder of any Notes shall bind the Holder
of every Note issued upon the registration thereof or in exchange therefor or in
lieu thereof, in respect of anything done, omitted or suffered to be done by the
Trustee or the Issuer in reliance thereon, whether or not notation of such
action is made upon such Note.
SECTION 1.74 Notices, etc., to the Trustee, the Issuer, the Insurer,
the Guarantor and the Rating Agencies.
(1) Any request, demand, authorization, direction, notice,
consent, waiver or Act of Noteholders or other documents provided or permitted
by this Indenture shall be in writing and if such request, demand,
authorization, direction, notice, consent, waiver or Act of Noteholders is to be
made upon, given or furnished to or filed with:
(1) the Trustee by any Noteholder, the Insurer or the
Issuer, shall be sufficient for every purpose hereunder if in writing
and mailed first-class, postage prepaid or sent by facsimile to the
Trustee addressed to:
1 Bank Xxx Xxxxx, Xxxxx XX0-0000
Xxxxxxx, XX 00000-0000
Attention: Global Corporate Trust Services
Fax No.: [(000) 000-0000]
Any notice to be given to the Trustee hereunder shall also be given to the
Depository and shall not be deemed given to the Trustee until also given to the
Depository;
(2) the Issuer by the Trustee, the Insurer or any
Noteholder, shall be sufficient for every purpose hereunder if in
writing and mailed first-class, postage prepaid or sent by facsimile to
the Issuer addressed to:
Desert Ridge Resort LLC
CNL Center at City Commons
000 Xxxxx Xxxxxx Xxxxxx
Xxxxxxx, Xxxxxxx 00000
Attention: Chief Operating Officer
Fax No.: (000) 000-0000
with a copy to:
Lowndes, Drosdick, Doster, Xxxxxx & Xxxx
000 Xxxxx Xxxx Xxxxx
Xxxxxxx, Xxxxxxx 00000
Attention: Xxxxxxx Xxxxxx, Esq.
Fax No.: (000) 000-0000
with a copy to:
Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP
Xxxx Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxx X. Xxxx, Esq.
Fax No.: (000) 000-0000
or at any other address previously furnished in writing to the Trustee by the
Issuer. The Issuer shall promptly transmit any notice received by it from the
Noteholders to the Trustee.
(3) the Insurer by the Issuer or the Trustee, shall
be sufficient for every purpose hereunder if given in the manner
required for notices pursuant to the terms of the Policy, including,
without limitation, satisfying the requirements specified in the Policy
for telephonic confirmation of deliveries by facsimile and delivery of
original copies of required notices and documentation by
internationally recognized overnight courier service or by personal
delivery. The Insurer's address for notices, subject to any change of
address pursuant to the terms of the Policy, shall be:
Financial Structures Limited
Chevron House, 00 Xxxxxx Xxxxxx
Xxxxxxxx, XXXX Xxxxxxx
Xxxxxxxxx: President
Fax No.: (000) 000-0000
with a copy to:
FSL Group, Inc.
00 Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxx, XX 00000
Attention: Xxxxxx X. Xxxxxx
Fax No.: (000) 000-0000
with a copy to:
Xxxxxx Xxxx & Xxxxxx LLP
000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxx X. Xxxxxxx, Xx.
Fax No.: (000) 000-0000
with a copy to the Reinsurer. The Reinsurer's address for notices, subject to
any change of address pursuant to the terms of the Reinsurance Agreement, shall
be:
Royal Indemnity Company
0000 Xxxxxxxxxx Xxxx.
Xxxxxxxxx, XX 00000-0000
Attention: X.X. Xxxx, General Manager
Fax No.: (000) 000-0000
-and-
Royal Indemnity Company
0000 Xxxxxxxxxx Xxxx.
Xxxxxxxxx, XX 00000-0000
Attention: Xxxxxx X. Xxxxxxx, Legal
and Regulatory Services
Fax No.: (000) 000-0000
Any notice given to the Insurer shall be deemed to be given or delivered to the
Insurer at the time and in the same manner in which any Notice of Claim is
deemed to be "Received" (as defined in the Policy).
(4) the Rating Agencies by the Issuer or the Trustee,
shall be sufficient for every purpose hereunder if in writing and
mailed first-class, postage prepaid or sent by facsimile to the Rating
Agencies addressed to:
Standard & Poor's Ratings Services
00 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Structured Finance Surveillance Group
Fax No.: (000) 000-0000
Xxxxx'x Investors Service, Inc.
00 Xxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Structured Finance Monitoring
Fax No.: (000) 000-0000
(5) the Guarantor by the Issuer, the Trustee or the
Insurer, shall be sufficient for every purpose hereunder if in writing,
and mailed first-class, postage prepaid or sent by facsimile to the
Guarantor address to:
Marriott International, Inc.
Xxx Xxxxxxxx Xxxxx
Xxxxxxxxxx, X.X. 00000
Attention: Treasurer
Fax No.: (000) 000-0000
Marriott International, Inc.
Xxx Xxxxxxxx Xxxxx
Xxxxxxxxxx, X.X. 00000
Attention: General Counsel
Fax No.: (000) 000-0000
with a copy to:
Arent, Fox Xxxxxxx, Xxxxxxx & Xxxx
0000 Xxxxxxxxxxx Xxx., X.X.
Xxxxxxxxxx, X.X. 00000-0000
Attention: Xxxxxx X. Xxxxxxxx, Esq.
Fax No.: (000) 000-0000
(2) The Issuer shall give the Insurer a copy of any notice
given by the Issuer to any party hereunder.
(3) A copy of any notice given by or received by the Issuer or
the Trustee shall be provided to the Insurer.
SECTION 1.75 Notices to and from Noteholders; Waiver. (a) There may be,
so long as a Global Note is held in its entirety on behalf of the Depository,
the delivery of the relevant notice to the Depository for communication by them
to the Beneficial Owners. Any such notice shall be deemed to have been given to
the Beneficial Owners on the seventh (7th) calendar day after the date on which
the said notice was given to the Depository.
Notices to be given by any Noteholder shall be in writing and given by
lodging the same with the Trustee. Such notice may be given by a Noteholder to
the Trustee via the Depository in such manner as the Trustee and the Depository
may approve for this purpose.
(1) Where this Indenture provides for notice in any manner,
such notice may be waived in writing by any Person entitled to receive such
notice, either before or after the event, and such waiver shall be the
equivalent of such notice. Waivers of notice by Noteholders shall be filed with
the Trustee but such filing shall not be a condition precedent to the validity
of any action taken in reliance upon such a waiver.
(2) In case, by reason of the suspension of regular mail
service as a result of a strike, work stoppage or similar activity, it shall be
impractical to mail notice of any event to Noteholders when such notice is
required to be given pursuant to any provision of this Indenture, then any
manner of giving such notice as shall be satisfactory to the Trustee shall be
deemed to be a sufficient giving of such notice.
(3) Where this Indenture provides for notice to the Rating
Agencies, failure to give such notice to the Rating Agencies shall not affect
any other rights or obligations created hereunder, and shall not under any
circumstance constitute a Default or an Event of Default.
(4) Notices to be given by any Noteholders shall be in writing
and given by lodging the same with the Trustee. Such notice may be given by a
Noteholder to the Trustee via the Depository in such manner as the Trustee and
the Depository may approve for this purpose.
(5) At any time at which a Global Note is not held in its
entirety on behalf of the Depository, notices to Noteholders shall be given by
the Trustee to the Noteholders in writing at the address therefor set forth in
the Note Register.
SECTION 1.76 Payment and Notice Dates. All payments to be made and
notices to be delivered pursuant to this Indenture shall be made by the
responsible party as of the dates specified herein.
SECTION 1.77 Alternative Payment and Notice Provisions. Notwithstanding
any provision of this Indenture or any of the Notes to the contrary, the Issuer,
subject to receipt of the prior consent of the Insurer, may enter into any
agreement with any Noteholder providing for a method of payment, or notice by
the Trustee or any Paying Agent, to such Holder that is different from the
methods provided for in this Indenture for such payments or notices. The Issuer
shall furnish to the Trustee a copy of each such agreement and the Trustee
shall, if practicable, cause payments to be made and notices to be given in
accordance with such agreements.
SECTION 1.78 Effect of Headings and Table of Contents. The Article and
Section headings herein and the Table of Contents are for convenience only and
shall not affect the construction hereof.
SECTION 1.79 Successors and Assigns. All covenants and agreements in
this Indenture and the Notes by the Issuer shall bind its successors and
assigns, whether so expressed or not. All agreements of the Trustee in this
Indenture shall bind its successors, co-trustees and agents.
SECTION 1.80 Separability. In case any provision in this Indenture or
in the Notes shall be invalid, illegal or unenforceable, the validity, legality,
and enforceability of the remaining provisions shall not in any way be affected
or impaired thereby.
SECTION 1.81 Benefits of Indenture. Subject to Sections 9.1 and 9.2 and
Article XI, nothing in this Indenture or in the Notes, express or implied, shall
give to any Person, other than the parties hereto and their successors
hereunder, and the Noteholders, any benefit or any legal or equitable right,
remedy or claim under this Indenture.
SECTION 1.82 Legal Holiday. In any case where the date on which any
payment is due shall not be a Business Day, then (notwithstanding any other
provision of the Notes or this Indenture) payment need not be made on such date,
but may be made on the next succeeding Business Day with the same force and
effect as if made on the date on which nominally due, and, except as otherwise
expressly provided herein, interest shall continue to accrue for the period from
and after any such nominal date.
SECTION 1.83 Governing Law. THIS INDENTURE AND EACH NOTE SHALL BE
CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK.
SECTION 1.84 Counterparts. This Indenture may be executed in any number
of counterparts, each of which so executed shall be deemed to be an original,
but all such counterparts shall together constitute but one and the same
instrument.
SECTION 1.85 Recording of Indenture. If this Indenture is subject to
recording in any appropriate public recording offices, such recording is to be
effected by the Issuer and at its expense.
SECTION 1.86 Corporate Obligation. No recourse may be taken, directly
or indirectly (i) with respect to the obligations of the Trustee under this
Indenture or any certificate or other writing delivered in connection herewith
or therewith, against (A) the Trustee in its individual capacity, or (B) any
partner, owner, beneficiary, agent, officer, director, employee or agent of the
Trustee in its individual capacity, any holder of equity in the Trustee or in
any successor or assign of the Trustee in its, his or her individual capacity,
(it being understood that the Trustee has no such obligations in its individual
capacity); (ii) with respect to the obligations of the Insurer or the Reinsurer
under this Indenture, the Policy, the Reinsurance Agreement, the Assignment of
Reinsurance or any certificate or other writing delivered in connection herewith
or therewith, against any partner, owner, beneficiary, agent, officer, director,
shareholder or employee of the Insurer or the Reinsurer or any Affiliate of
either thereof, each in its, his or her individual capacity or any holder of
equity in the Insurer or the Reinsurer or any Affiliate of either thereof, each
in its, his or her individual capacity; and (iii) with respect to the
obligations of the Issuer on the Notes or under the Indenture or any certificate
or other writing delivered in connection herewith or therewith, against any
partner, owner, beneficiary, agent, officer, director or employee of the Issuer
or any Affiliate of the Issuer, each in its, his or her individual capacity, or
any holder of equity in the Issuer or any Affiliate of the Issuer, each in its,
his or her individual capacity, provided, however, nothing in this Section 12.16
shall limit the obligations and liabilities of the Guarantor under the
Completion Guarantee or the Payment Guarantee.
SECTION 1.87 Inspection. The Issuer agrees that, with reasonable prior
notice, it will permit any representative of the Trustee and the Insurer during
the Issuer's normal business hours, to examine all the books of account,
records, reports and other papers of the Issuer, to make copies and extracts
therefrom, to cause such books to be audited by independent certified public
accountants, and to discuss the Issuer's affairs, finances and accounts with the
Issuer's officers, employees and Independent certified public accountants, all
at such reasonable times and as often as may be reasonably requested. Except
with respect to any such information disclosed to or on behalf of the
Noteholders, the Trustee and the Insurer shall and shall cause their respective
representatives to hold in confidence all such information except to the extent
disclosure may be required by law (and all reasonable applications for
confidential treatment are unavailing).
SECTION 1.88 Waiver of Immunities. To the extent that the Issuer has or
hereafter may acquire any immunity from jurisdiction of any court or from any
legal process (whether through service of notice, attachment prior to judgment,
attachment in aid of execution, execution or otherwise) with respect to itself
or its property, the Issuer hereby irrevocably waives such immunity in respect
of its obligations under this Indenture and the Notes, to the extent permitted
by law.
SECTION 1.89 Satisfaction and Discharge. This Indenture, upon Issuer
Request and receipt by the Trustee of an Opinion of Counsel, shall cease to be
of further effect, and the Trustee, at the Issuer's expense, shall execute
proper instruments acknowledging satisfaction and discharge of this Indenture
when all Notes (except those theretofore paid in full, which were lost, stolen
or destroyed and replaced, or delivered to the Trustee for cancellation) and all
amounts due to the Insurer (whether by virtue of the Insurer's rights of
subrogation set forth in the last sentence of Section 11.1 or otherwise) have
been indefeasibly paid in full (including all amounts of principal, interest and
Additional Amounts, if any) or funds in an amount sufficient to make payment in
full have been irrevocably deposited with the Trustee, in trust, for the purpose
of making such payments, and all other amounts due and payable under this
Indenture to the Trustee and the Insurer, including the fees and expenses of the
Trustee in all of its capacities, have been paid in full. Notwithstanding the
foregoing, the provisions of Sections 5.7, 11.3 and 12.16 shall survive such
satisfaction and discharge. Any moneys deposited with the Trustee pursuant to
this Section 12.19 shall be held by the Trustee in trust and applied to the
payment to the Persons entitled thereto, all in accordance with the terms of the
Notes and this Indenture, including Section 7.1(b). Upon the satisfaction and
discharge of this Indenture as provided in this Section 12.19, the Collateral
shall be released.
[REMAINDER OF PAGE INTENTIONALLY BLANK]
IN WITNESS WHEREOF, the Issuer, the Trustee and the Insurer
have caused this Indenture to be duly executed by their respective officers,
thereunto duly authorized and duly attested, all as of the day and year first
above written.
DESERT RIDGE RESORT, LLC,
as Issuer
By: Desert Ridge Resort Partners, LLC,
a Delaware limited liability company,
its sole member
By: CNL DRR Investor LP,
a Delaware limited partnership,
its managing member
By: CNL Phoenix GP Corp., general partner
By: /s/ C. Xxxxx Xxxxxxxxxx
-----------------------
Name: C. Xxxxx Xxxxxxxxxx
Title: Senior Vice President of Finance
and Administration
BANK ONE, NATIONAL ASSOCIATION,
not in its individual capacity but solely as
the Trustee under this Indenture
By: /s/ Xxxxx Xxxxx
------------------------
Name: Xxxxx Xxxxx
Title: Assistant Vice President
FINANCIAL STRUCTURES LIMITED,
as Insurer
By: /s/ Xxxxx Xxxxxxx
-----------------
Name: Xxxxx Xxxxxxx
Title: Authorized Representative
FSL-00-239
