LOAN AGREEMENT Dated as of September 12, 2007 Between MAGUIRE PROPERTIES-355 S. GRAND, LLC, a Delaware limited liability company, as Borrower and EUROHYPO AG, NEW YORK BRANCH, as Lender
Exhibit
99.1
Dated
as
of September 12, 2007
Between
XXXXXXX
PROPERTIES-355 S. GRAND, LLC,
a
Delaware limited liability company,
as
Borrower
and
EUROHYPO
AG, NEW YORK BRANCH,
as
Lender
TABLE
OF CONTENTS
| Page | ||
|
I.
|
DEFINITIONS;
PRINCIPLES OF CONSTRUCTION
|
1
|
|
Section
1.1.
|
Definitions
|
1
|
|
Section
1.2.
|
Principles
of Construction
|
26
|
|
II.
|
THE
LOAN
|
27
|
|
Section
2.1.
|
The
Loan
|
27
|
|
Section
2.2.
|
Interest
Rate
|
32
|
|
Section
2.3.
|
Loan
Payments
|
36
|
|
Section
2.4.
|
Prepayments
|
37
|
|
Section
2.5.
|
Interest
Rate Swap
|
39
|
|
Section
2.6.
|
Guarantee
Rights
|
39
|
|
III.
|
REPRESENTATIONS
AND WARRANTIES
|
40
|
|
Section
3.1.
|
Borrower
Representations
|
40
|
|
Section
3.2.
|
Survival
of Representations
|
52
|
|
IV.
|
BORROWER
COVENANTS
|
52
|
|
Section
4.1.
|
Borrower
Affirmative Covenants
|
52
|
|
Section
4.2.
|
Borrower
Negative Covenants
|
62
|
|
V.
|
INSURANCE,
CASUALTY AND CONDEMNATION
|
66
|
|
Section
5.1.
|
Insurance
|
66
|
|
Section
5.2.
|
Casualty
and Condemnation
|
71
|
|
Section
5.3.
|
Delivery
of Net Proceeds
|
72
|
|
VI.
|
RESERVE
FUNDS
|
76
|
|
Section
6.1.
|
KPMG
Abatement Funds
|
76
|
|
Section
6.2.
|
Tax
Funds
|
76
|
|
Section
6.3.
|
Insurance
Funds
|
77
|
|
Section
6.4.
|
Capital
Expenditure Funds
|
78
|
|
Section
6.5.
|
Rollover
Funds
|
80
|
|
Section
6.6.
|
Existing
Tenant Improvement Funds
|
81
|
|
Section
6.7.
|
Xxxxxx
Landlord Work Funds
|
82
|
|
Section
6.8.
|
Security
Interest in Reserve Funds
|
85
|
i
TABLE
OF CONTENTS
(continued)
| Page | ||
|
VII.
|
PROPERTY
MANAGEMENT
|
86
|
|
Section
7.1.
|
The
Management Agreement
|
86
|
|
Section
7.2.
|
Prohibition
Against Termination or Modification
|
87
|
|
Section
7.3.
|
Replacement
of Manager
|
87
|
|
VIII.
|
TRANSFERS
|
87
|
|
Section
8.1.
|
Transfer
or Encumbrance of Property.
|
87
|
|
IX.
|
SALE
AND SECURITIZATION OF MORTGAGE
|
92
|
|
Section
9.1.
|
Sale
of Mortgage and Securitization
|
92
|
|
Section
9.2.
|
Securitization
Indemnification
|
94
|
|
X.
|
DEFAULTS
|
97
|
|
Section
10.1.
|
Event
of Default
|
97
|
|
Section
10.2.
|
Remedies
|
99
|
|
Section
10.3.
|
Right
to Cure Defaults
|
100
|
|
Section
10.4.
|
Remedies
Cumulative
|
101
|
|
Section
10.5.
|
Xxxxxx
& Xxxxxxx U.S. Bank Tower Lease Takeover Agreement Cash Collateral
or
Collateral Letter of Credit.
|
101
|
|
XI.
|
MISCELLANEOUS
|
105
|
|
Section
11.1.
|
Successors
and Assigns
|
105
|
|
Section
11.2.
|
Lender’s
Discretion
|
105
|
|
Section
11.3.
|
Governing
Law
|
105
|
|
Section
11.4.
|
Modification,
Waiver in Writing
|
107
|
|
Section
11.5.
|
Delay
Not a Waiver
|
107
|
|
Section
11.6.
|
Notices
|
107
|
|
Section
11.7.
|
Trial
by Jury
|
108
|
|
Section
11.8.
|
Headings
|
109
|
|
Section
11.9.
|
Severability
|
109
|
|
Section
11.10.
|
Preferences
|
109
|
|
Section
11.11.
|
Waiver
of Notice
|
109
|
|
Section
11.12.
|
Remedies
of Borrower
|
109
|
|
Section
11.13.
|
Expenses;
Indemnity
|
110
|
|
Section
11.14.
|
Schedules
Incorporated
|
111
|
ii
TABLE
OF CONTENTS
(continued)
| Page | ||
|
Section
11.15.
|
Offsets,
Counterclaims and Defenses
|
111
|
|
Section
11.16.
|
No
Joint Venture or Partnership; No Third Party Beneficiaries
|
111
|
|
Section
11.17.
|
Publicity
|
112
|
|
Section
11.18.
|
Waiver
of Marshalling of Assets
|
112
|
|
Section
11.19.
|
Waiver
of Offsets/Defenses/Counterclaims
|
112
|
|
Section
11.20.
|
Conflict;
Construction of Documents; Reliance
|
112
|
|
Section
11.21.
|
Brokers
and Financial Advisors
|
113
|
|
Section
11.22.
|
Exculpation
|
113
|
|
Section
11.23.
|
Prior
Agreements
|
116
|
|
Section
11.24.
|
Servicer
|
116
|
|
Section
11.25.
|
Joint
and Several Liability
|
117
|
|
Section
11.26.
|
Creation
of Security Interest
|
117
|
|
Section
11.27.
|
Assignments
and Participations
|
117
|
|
Section
11.28.
|
[Reserved]
|
118
|
|
Section
11.29.
|
Component
Notes.
|
118
|
|
Section
11.30.
|
Approvals;
Third Parties; Conditions
|
119
|
|
Section
11.31.
|
Limitation
on Liability of Lender’s Officers, Employees, etc
|
119
|
|
Section
11.32.
|
Mezzanine
Loan Option
|
120
|
|
Section
11.33.
|
Exclusivity.
|
121
|
|
Section
11.34.
|
Rating
Agency Confirmation
|
121
|
iii
THIS
LOAN
AGREEMENT, dated as of September 12, 2007 (as amended, restated, replaced,
supplemented or otherwise modified from time to time, this
“Agreement”), between EUROHYPO AG, NEW YORK
BRANCH, the New York branch of a German banking corporation, having an
address at 1114 Avenue of the Xxxxxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000
(together with its permitted successors and assigns,
“Lender”), and Xxxxxxx Properties-355 S. Grand, LLC, a
Delaware limited liability company having an address at 0000 Xxxxx Xxxxxx,
0xx
Xxxxx, Xxxxx Xxxxxx, Xxxxxxxxxx 00000 (together with its permitted successors
and assigns “Borrower”).
All
other
capitalized terms used herein shall have the respective meanings set forth
in
Article I hereof.
W
I T N E S S E T H :
WHEREAS,
Borrower desires to obtain the Loan from Lender; and
WHEREAS,
Lender is willing to make the Loan to Borrower, subject to and in accordance
with the conditions and terms of this Agreement and the other Loan
Documents.
NOW,
THEREFORE, in consideration of the covenants set forth in this Agreement,
and
other good and valuable consideration, the receipt and sufficiency of which
are
hereby acknowledged, the parties hereto hereby agree, represent and warrant
as
follows:
|
|
I.
|
DEFINITIONS;
PRINCIPLES OF CONSTRUCTION
|
Section
1.1. Definitions.
For
all
purposes of this Agreement, except as otherwise expressly provided:
“Access
Laws” shall have the meaning set forth in Section
4.1.18(a).
“Accounts”
shall have the meaning set forth in Section 3.1.35(a).
“Advance”
means a Xxxxxx & Xxxxxxx Imputed Rent Advance or a TI/LC
Advance.
“Advance
Request” shall mean a written request substantially in the form of
Exhibit B from Borrower to Lender and the Note B Designated
Representative, signed by an authorized officer of Borrower and requesting
the
Note B Designated Representative to instruct the Note B-2 Lender to make
an
Advance.
“Affiliate”
shall mean, as to any Person, any other Person that, directly or indirectly
is
in control of, is controlled by or is under common ownership or control with
such Person or is a director or officer of such Person or of an Affiliate
of
such Person. As used in this definition, the term
“control” means the possession, directly or indirectly,
of the power to direct or cause the
0
xxxxxxxxx
of the management, policies or activities of a Person, whether through ownership
of voting securities, by contract or otherwise.
“Affiliated
Hedge Party” means Xxxxxxx Properties, L.P., a Maryland limited
partnership.
“Affiliated
Manager” shall mean any managing agent in which Borrower, Borrower
Principal, any SPC Party (if any) or any Affiliate of such Persons has, directly
or indirectly, any legal, beneficial or economic interest.
“Agent”
shall mean Bank of the West (and any successor Eligible Institution thereto)
or
any Eligible Institution.
“Aggregate
Calculated Debt Service” shall mean, with respect to any particular
period of time, the sum of the Calculated Debt Service plus the payments
of
interest that would be due on a principal balance equal the maximum commitment
amount under each a Permitted Mezzanine Loan, assuming interest payments
at the
greater of (i) an annualized interest rate of 6.5% and (ii) the actual interest
rate under each such Permitted Mezzanine Loan for the most recently ended
calendar quarter.
“Aggregate
Debt” shall mean the outstanding principal amount of the Loan and
the Permitted Mezzanine Loan, together with all interest accrued and unpaid
thereon.
“Aggregate
Debt Service Coverage Ratio” shall mean a ratio for the applicable
period in which:
|
|
(i)
|
the
numerator is the Historical Net Operating Income for such period
as set
forth in the financial statements required in accordance with this
Agreement; and
|
|
|
(ii)
|
the
denominator is the Aggregate Calculated Debt Service due for such
period.
|
“Aggregate
Loan to Value Ratio” shall mean the ratio, as of a particular date,
in which the numerator is equal to the Aggregate Debt and the denominator
is
equal to the appraised value of the Property based on an Appraisal, as
determined by Lender in its sole and absolute discretion.
“ALTA”
shall mean American Land Title Association or any successor
thereto.
“Alteration
Threshold” shall mean an amount equal to five percent (5%) of the
original principal amount of the Loan.
“Annual
Budget” shall have the meaning set forth in Section
4.1.6.
“Applicable
Interest Rate” shall mean, for the initial Interest Period, the
Initial Interest Rate and thereafter either (i) the LIBOR Interest Rate plus
the
Spread with respect to any period
2
when
the
Loan is a LIBOR Loan or (ii) the Substitute Rate plus the Substitute Spread
with
respect to any period when the Loan is a Substitute Rate Loan.
“Appraisal”
shall mean an appraisal of the Property in its then “as is” condition, prepared
not more than ninety (90) days prior to the Closing Date (or other
relevant date with respect to an updated Appraisal or an Appraisal with respect
to the Property) by an appraiser selected by Lender, which appraisal
(i) shall meet the minimum appraisal standards for national banks
promulgated by the Comptroller of the Currency pursuant to Title XI of the
Financial Institutions Reform, Recovery, and Enforcement Act of 1989, as
amended
(FIRREA), and (ii) otherwise shall be in both form and substance
satisfactory to Lender in its sole and absolute discretion.
“Approved
Fund” shall mean any Person (other than a natural person) that is
engaged in making, purchasing, holding or investing in bank loans and similar
extensions of credit in the ordinary course of its business and that is
administered or managed by (a) Lender, (b) an Affiliate of Lender or
(c) an entity or an Affiliate of an entity that administers or manages
Lender.
“Approved
Transferee” means a Person who (i) is not and has not, within the
preceding two (2) years, been adverse to any Note B Lender in any judicial,
arbitral or similar proceeding, (ii) is not a Prohibited Person, and (iii)
in
the event that the Guarantor or REIT shall no longer own at least fifty-one
percent (51%) of the direct or indirect ownership interests in Borrower as
a
result of a transfer permitted hereunder, is an Institutional
Investor.
“Assignment
of Leases” shall mean that certain first priority Assignment of
Leases and Rents, dated as of the date hereof, from Borrower, as assignor,
to
Lender, as assignee, as the same may be amended, restated, replaced,
supplemented or otherwise modified from time to time.
“Assignment
of Letter of Credit” shall mean an assignment and/or security
agreement in form and content acceptable to Lender, executed by a Person
that is
assigning to and granting a security interest in a Tenant Letter of Credit
in
favor of Lender that names such Person as account party and/or
beneficiary.
“Assignment
of Management Agreement” shall mean that certain Assignment of
Management Agreement and Subordination of Management Fees dated the date
hereof
among Borrower, Manager and Lender, as the same may be amended, restated,
replaced, supplemented or otherwise modified from time to time.
“Assignment
of Protection Agreement” shall mean that certain Collateral
Assignment of Interest Rate Protection Agreement dated the date hereof among
Borrower and Lender, as the same may be amended, restated, replaced,
supplemented or otherwise modified from time to time.
“Award”
shall mean any compensation paid by any Governmental Authority in connection
with a Condemnation in respect of all or any part of the Property.
3
“Bankruptcy
Code” shall mean Title 11 of
the United States Code entitled “Bankruptcy”, as amended from time to time, and
any successor statute or statutes and all rules and regulations from time
to
time promulgated thereunder, and any comparable foreign laws relating to
bankruptcy, insolvency or creditors’ rights.
“Basic
Carrying Costs” shall mean the sum of the following costs
associated with the Property for the relevant Fiscal Year or payment
period: (i) Taxes and (ii) Insurance Premiums.
“Borrower
Principal” shall mean any of Xxxxxxx Properties, Inc. or Xxxxxxx
Properties L.P.
“Breakage
Costs” shall have the meaning set forth in
Section 2.2.3(g).
“Broker”
shall have the meaning set forth in Section 11.21.
“Business
Day” shall mean any day other than a Saturday, a Sunday or a legal
holiday on which national banks are not open for general business in
(i) the State of New York, (ii) the state where the corporate trust
office of the Trustee is located, or (iii) the state where the servicing
offices of the Servicer are located.
“Calculated
Debt Service” shall mean, with respect to any particular period of
time, the payments of interest that would be due on a principal balance equal
to
the Facility Amount, calculated on an annualized basis assuming interest
payments at the greater of (i) an annualized interest rate of 6.50% and (ii)
the
actual interest rate under the Notes for the most recently ended calendar
quarter.
“Capital
Expenditures” for any period shall mean amounts expended for
replacements and alterations to the Property and required to be capitalized
according to GAAP.
“Capital
Expenditure Funds” shall have the meaning set forth in Section
6.4.1.
“Capital
Expenditures Work” shall mean any labor performed or materials
installed in connection with any Capital Expenditure.
“Capped
LIBOR Rate” shall mean 5.564% per annum.
“Cash
Management Agreement” shall mean that certain Cash Management
Agreement of even date herewith among Lender, Borrower, Manager and
Agent.
“Cash
Trap Period” shall the period of time commencing with the
occurrence of an Event of Default and continuing until the later of (i) the
date
on which such Event of Default (and any Default or other Event of Default
that
may have occurred subsequent thereto) no longer exists or (ii) the date on
which
the Debt Service Coverage Ratio shall be at or above 1.10:1.00 for a period
of
at least four (4) consecutive calendar quarters.
“Casualty”
shall mean the occurrence of any casualty, damage or injury, by fire or
otherwise, to the Property or any part thereof.
4
“Casualty
Retainage” shall have the meaning set forth in
Section 5.3.2(d).
“Change
of Control” means:
(a) in
the case of Guarantor, the occurrence of any change such that REIT no longer
Controls Guarantor; and
(b) in
the case of REIT, the occurrence of a change in the composition of the governing
body of REIT such that a majority of the members of any such governing body
(i)
were not members of such governing body on the date of this Agreement and
(ii)
were not (A) nominated for election or elected to such governing body with
the
affirmative vote of a majority of the members who were either members of
such
governing body on the date of this Agreement or whose nomination or election
was
previously so approved or (B) nominated to such governing body with the
affirmative vote of a nominating committee, the majority of the members of
which
were (x) members of such governing body on the date of this Agreement, (y)
members whose nomination was previously so approved by such a nominating
committee and/or (z) members whose nomination or election was previously
approved in accordance with the immediately preceding clause (A).
“Closing
Date” shall mean the date of the initial funding of the
Loan.
“Code”
shall mean the Internal Revenue Code of 1986, as amended, and as it may be
further amended from time to time, any successor statutes thereto, and
applicable U.S. Department of Treasury regulations issued pursuant thereto
in
temporary or final form.
“Collateral
Letter of Credit” shall mean a clean, irrevocable and unconditional
standby letter of credit that is (a) issued in favor of Lender in the amount
required pursuant to Section 10.5, (b) issued by (i) an issuer reasonably
satisfactory to Lender and which has a paying office in the City of New York
and
a senior unsecured debt rating with respect thereto of “A+” or better by S&P
or (ii) such other issuer as shall be approved by Lender in its sole and
absolute discretion, (c) drawable, in whole or in part from time to time,
by
Lender upon the presentment to the issuer of a clean sight draft demanding
such
payment, (d) an “evergreen” letter of credit that initially has an expiration
date of at least one (1) year from the date of deposit and is automatically
renewed from year to year or one which does not expire until at least thirty
(30) Business Days after the Maturity Date, (e) assignable by Lender in the
ordinary course and in compliance with the issuer’s usual and customary
procedures for assignment at no cost and expense that is not required to
be
reimbursed by Borrower pursuant to Section 11.13 hereof,
and (f) otherwise reasonably satisfactory to Lender.
“Condemnation”
shall mean a temporary or permanent taking by any Governmental Authority
as the
result or in lieu or in anticipation of the exercise of the right of
condemnation or eminent domain, of all or any part of the Property, or any
interest therein or right accruing thereto, including any right of access
thereto or any change of grade affecting the Property or any part
thereof.
5
“Controlled
Account” shall mean one or more deposit accounts established by the
Lender at a Depository Bank that is acceptable to Lender, and which is
established and maintained in accordance with Section 10.5
hereof.
“Controlled
Account Agreement” shall have the meaning set forth in Section
10.5.
“Controlled
Account Collateral” shall have the meaning set forth in Section
10.5.
“Counterparty”
shall mean (a) the counterparty under the Interest Rate Protection Agreement
and
(b) a Person that guarantees such counterparty’s obligations under the Interest
Rate Protection Agreement or otherwise provides to such counterparty credit
support acceptable to Lender or, after a Securitization, the Rating Agencies,
provided, however, that such guarantor shall be deemed the “Counterparty” for so
long as the long-term credit rating issued by the Rating Agencies to such
guarantor is better than the long-term credit rating of the actual counterparty
under the Interest Rate Protection Agreement.
“Covered
Disclosure Information” shall have the meaning set forth in
Section 9.2(b).
“Debt”
shall mean the outstanding principal amount of the Loan together with all
interest accrued and unpaid thereon and all other sums (including, without
limitation, the Spread Maintenance Premium, any Breakage Costs, all obligations
of Borrower to perform under the Xxxxxx & Xxxxxxx U.S. Bank Tower Lease
Takeover Agreement and all obligations of Borrower under Section 10.5
hereof) due by Borrower in respect of the Loan under the Notes, this Agreement,
the Mortgage, the Environmental Indemnity or any other Loan
Document.
“Debt
Service Coverage Ratio” shall mean a ratio for the applicable
period in which:
|
|
(i)
|
the
numerator is the Historical Net Operating Income for such period
as set
forth in the financial statements required in accordance with this
Agreement; and
|
|
|
(ii)
|
the
denominator is the Calculated Debt Service due for such
period.
|
“Default”
shall mean the occurrence of any event hereunder or under any other Loan
Document which, but for the giving of notice or passage of time, or both,
would
be an Event of Default.
“Default
Rate” shall mean, with respect to the Loan, a rate per annum equal
to the lesser of (i) the maximum rate permitted by applicable law, or
(ii) five percent (5%) above the Applicable Interest Rate.
6
“Determination
Date” shall mean, with respect to any Interest Period, the date
that is two (2) London Business Days prior to the fifteenth (15th) day of
the
month in which such Interest Period commences; provided, however, that Lender
shall have the right to change the Determination Date to any other day upon
notice to Borrower (in which event such change shall then be deemed effective)
and, if requested by Lender, Borrower shall promptly execute an amendment
to
this Agreement to evidence such change.
“Disclosure
Document” shall have the meaning set forth in
Section 9.2.
“Eligible
Account” shall mean a separate and identifiable account from all
other funds held by the holding institution that is either (i) an account
or accounts maintained with a federal or state-chartered depository institution
or trust company which complies with the definition of Eligible Institution
or
(ii) a segregated trust account or accounts maintained with a federal or
state chartered depository institution or trust company acting in its fiduciary
capacity which, in the case of a state chartered depository institution or
trust
company is subject to regulations substantially similar to 12 C.F.R. §9.10(b),
having in either case a combined capital and surplus of at least $50,000,000.00
and subject to supervision or examination by federal and state
authority. An Eligible Account will not be evidenced by a certificate
of deposit, passbook or other instrument.
“Eligible
Assignee” means any of (i) a commercial bank organized under
the laws of the United States, or any state thereof, and having (x) total
assets in excess of $1,000,000,000 and (y) a combined capital and surplus
of at least $250,000,000; (ii) a commercial bank organized under the laws
of any other country which is a member of the Organization of Economic
Cooperation and Development (“OECD”), or a political
subdivision of any such country, and having (x) total assets in excess of
$1,000,000,000 and (y) a combined capital and surplus of at least
$250,000,000, provided that such bank is acting through a branch or agency
located in the country in which it is organized or another country which
is also
a member of OECD; (iii) a life insurance company organized under the laws
of any state of the United States, or organized under the laws of any country
and licensed as a life insurer by any state within the United States and
having
admitted assets of at least $1,000,000,000; (iv) a nationally recognized
investment banking company or other financial institution in the business
of
making loans, or an Affiliate thereof (other than any Person which is directly
or indirectly a Restricted Party or directly or indirectly an Affiliate of
any
Restricted Party) organized under the laws of any state of the United States,
and licensed or qualified to conduct such business under the laws of any
such
state and having (1) total assets of at least $1,000,000,000 and (2) a
net worth of at least $250,000,000; (v) an Approved Fund; (vi) or a
Related Entity of Lender; or (vii) any other Person reasonably acceptable
to Borrower (to the extent Borrower’s consent to an assignment is required for
an assignment to a Person other than those identified in clauses (i)
through (vi) above, pursuant to Section 11.27, and provided that all
other applicable conditions to such assignment set forth in Section 11.27
have been satisfied).
7
“Eligible
Institution” shall mean Bank of the West (so long as its credit
rating for long term unsecured debt obligations does not fall below the ratings
in effect as of the date hereof) or a depository institution or trust company
insured by the Federal Deposit Insurance Corporation the short term unsecured
debt obligations or commercial paper of which are rated at least A-1 by S&P
and having at least the equivalent rating from one of the two other Rating
Agencies in the case of accounts in which funds are held for thirty (30)
days or
less or, in the case of Letters of Credit or accounts in which funds are
held
for more than thirty (30) days, the long term unsecured debt obligations
of
which are rated at least “AA” by Fitch and S&P and “Aa2” by
Moody’s.
“Environmental
Indemnity” shall mean that certain Environmental Indemnity
Agreement, dated as of the date hereof, executed by Borrower and Guarantor
in
connection with the Loan for the benefit of Lender.
“Environmental
Report” shall mean that certain Environmental Phase I Report
prepared by EMG, dated August 18, 2007.
“Equipment”
shall have the meaning set forth in the granting clause of the
Mortgage.
“ERISA”
shall have the meaning set forth in Section 4.2.7.
“Event
of Default” shall have the meaning set forth in
Section 10.1(a).
“Exchange
Act” shall have the meaning set forth in
Section 9.2.
“Executive
Order” shall have the meaning set forth in the definition of
“Prohibited Person”.
“Existing
Tenant Improvement Funds” shall have the meaning specified in
Section 6.6.
“Facility
Amount” shall mean Four Hundred Million Dollars
($400,000,000).
“Fee
Letter” shall have the meaning set forth in Section
4.1.16.
“Fiscal
Year” shall mean each twelve (12) month period commencing on
January 1 and ending on December 31 during each year of the term of
the Loan.
“Fitch”
shall mean Fitch, Inc. and its successors.
“Foreign
Taxes” shall have the meaning set forth in Section
2.2.3(d).
8
“GAAP”
shall mean generally accepted accounting principles set forth in the opinions
and pronouncements of the Accounting Principles Board and the American Institute
of Certified Public Accountants and statements and pronouncements of the
Financial Accounting Standards Board (or agencies with similar functions
of
comparable stature and authority within the accounting profession), or in
such
other statements by such entity as may be in general use by significant segments
of the U.S. accounting profession.
“Governing
Law State” shall mean the State of New York.
“Governmental
Authority” shall mean any court, board, agency, commission, office
or authority of any nature whatsoever or any governmental xxxx (xxxxxxx,
xxxxx,
xxxxxx, xxxxxxxx, xxxxxxxxx, xxxx or otherwise) whether now or hereafter
in
existence.
“Gross
Income from Operations” shall mean, for any period, all income,
computed in accordance with GAAP, derived from the ownership and operation
of
the Property from whatever source during such period, including, but not
limited
to, Rents, utility charges, escalations, forfeited security deposits, interest
on credit accounts, service fees or charges, license fees, parking fees,
any and
all payments received pursuant to and in accordance with the Interest Rate
Protection Agreement, pass-through or reimbursements paid by tenants under
the
Leases of any nature but excluding Rents from month-to-month tenants or tenants
that are included in any voluntary or involuntary bankruptcy case pursuant
to
the Bankruptcy Code is currently pending (unless the debtor in such bankruptcy
case or another Person has assumed the obligations under such lease pursuant
to
a confirmed plan of reorganization for which an order approving such plan
of
reorganization has been entered), sales, use and occupancy or other taxes
on
receipts required to be accounted for by Borrower to any Governmental Authority,
refunds and uncollectible accounts, sales of furniture, fixtures and equipment,
Net Proceeds (other than business interruption or other loss of income
insurance), and any disbursements to Borrower from the Tax Funds, Insurance
Funds, the Capital Expenditure Funds, the Rollover Funds, the Existing Tenant
Improvement Funds or any other escrow fund established by the Loan
Documents.
“Guarantor”
shall mean Xxxxxxx Properties, L.P.
“Guarantee”
shall mean either the Recourse Guarantee, or the Xxxxxx & Xxxxxxx U.S. Bank
Tower Lease Guarantee, or both.
“Historical
Net Operating Income” shall mean, for any period, (a) the sum of
(i) Rents from Leases under which the tenants are in Occupancy or who have
executed Leases and are expected to be in Occupancy within three (3) months
or
less from the date of determination provided those tenants take occupancy
within
three months (or less), (ii) the amount of any Xxxxxx & Xxxxxxx Imputed Rent
Advance required to be released by Lender for such period, (iii) the amount
of
abated rent under the KPMG Lease for such period, and (iv) any contractual
rent
increases under the Leases referred to in clause (i) scheduled to occur in
the next twelve (12) months following the date of determination (with any
applicable percentage rental revenue being based upon the most recently ended
12-month period), determined in accordance with GAAP,
9
but
without taking into account straight-lining of rents and extraordinary revenues
(including, but not limited to lease termination payments) (provided that
in no
event shall the Rents taken into account in this clause (a) be based on
straight-lining of rents or include Rents from month-to-month tenants, or
from
tenants in bankruptcy, or from tenants in monetary default for sixty (60)
days
or more under their Leases, or from tenants with Leases expiring within six
(6)
months of the applicable test date (unless the applicable tenant has an executed
letter of intent for an extension or provided written confirmation of its
election to exercise a renewal option), and the Rents taken into account
in this
clause (i) shall be adjusted for a deemed vacancy factor equal to five percent
(5%) of the revenues referred to in clause (a) for the applicable period
(if the
actual vacancy factor is less)) minus (b) the sum of all
annualized Operating Expenses during the applicable period, including, without
duplication, (i) annualized insurance premiums allocable to the applicable
period, (ii) annualized real estate taxes allocable to the applicable period,
(iii) capital expenses at an imputed annual rate of $0.15 per rentable square
foot allocable to the applicable period, and (iv) management fees (in the
amount
equal to the greater of (1) management fees actually paid during the applicable
period, and (2) an imputed rate of two percent (2.00%) of annualized revenues
referred to in clause (a) allocable to the applicable
period). Historical Net Operating Income shall in no event include
extraordinary non-recurring revenues (such as lease termination payments)
or
expenses (it being understood that any payments that Borrower makes to U.S.
Bank
Tower owner pursuant to the Xxxxxx & Xxxxxxx U.S. Bank Tower Lease Takeover
Agreement are deemed as extraordinary non-recurring expenses), or any debt
service payable with respect to the Loan.
“Improvements”
shall have the meaning set forth in the granting clause of the
Mortgage.
“Indebtedness”
shall mean, for any Person, without duplication: (i) all
indebtedness of such Person for borrowed money, for amounts drawn under a
letter
of credit, or for the deferred purchase price of property for which such
Person
or its assets is liable, (ii) all unfunded amounts under a loan agreement,
letter of credit, or other credit facility for which such Person would be
liable
if such amounts were advanced thereunder, (iii) all amounts required to be
paid by such Person as a guaranteed payment to partners or a preferred or
special dividend, including any mandatory redemption of shares or interests,
(iv) all indebtedness guaranteed by such Person, directly or indirectly,
(v) all obligations under leases that constitute capital leases for which
such Person is liable, and (vi) all obligations of such Person under
interest rate swaps, caps, floors, collars and other interest hedge agreements,
in each case whether such Person is liable contingently or otherwise, as
obligor, guarantor or otherwise, or in respect of which obligations such
Person
otherwise assures a creditor against loss.
“Indemnified
Liabilities” shall have the meaning set forth in
Section 11.13(b).
“Independent
Director” shall have the meaning set forth in
Section 3.1.24(q).
“Independent
Manager” shall have the meaning set forth in
Section 3.1.24(q).
“Initial
Interest Rate” shall mean, with respect to any Note, the initial
interest rate stated in such Note.
10
“Insolvency
Opinion” shall mean that
certain bankruptcy non-consolidation opinion letter, dated the date hereof,
rendered by Xxxxxxxx, Xxxxxx & Finger, P.A. in connection with the
Loan.
“Institutional
Investor” means one or more of the following:
(a) a
real estate investment trust, bank, saving and loan association, investment
bank, insurance company, trust company, commercial credit corporation, pension
plan, pension fund or pension advisory firm, mutual fund, government entity
or
plan, provided that any such Person referred to in this clause (a)
satisfies the Eligibility Requirements;
(b) an
investment company, money management firm or “qualified institutional buyer”
within the meaning of Rule 144A under the Securities Act of 1933, as amended,
or
an institutional “accredited investor” within the meaning of Regulation D under
the Securities Act of 1933, as amended, provided that any such Person referred
to in this clause (b) satisfies the Eligibility
Requirements;
(c) an
institution substantially similar to any of the entities described in
clauses (c) or (d) that satisfies the Eligibility
Requirements;
(d) any
entity Controlling or Controlled by or under common Control with any of the
entities described in clauses (a), (b) or (c) above (for
these purposes, “Control” of one Person (the
“controlled Person”) by another Person (the
“controlling Person”) shall mean the possession,
directly or
indirectly, by the controlling Person of the power or ability to direct or
cause
the direction of the management or policies of the controlled Person, whether
through the ability to exercise voting power, by contract or otherwise
(“Controlled” and “Controlling” each have the
meanings correlative thereto)); or
(e) an
investment fund, limited liability company, limited partnership or general
partnership (a “Permitted Investment Fund”) where a Permitted
Fund Manager or an entity that is otherwise an Institutional Investor described
in clauses (a), (b), (c) or (d) above investing through a
fund with committed capital of at least $250,000,000.00 acts as the general
partner, managing member or fund manager and at least fifty percent (50%)
of the
equity interests in such Permitted Investment Fund are owned, directly or
indirectly, by one or more of the following: an Institutional Investor or
an
institutional “accredited investor”, within the meaning of Regulation D
promulgated under the Securities Act of 1933, as amended, and/or a “qualified
institutional buyer” or both within the meaning of Rule 144A promulgated under
the Securities Exchange Act of 1934, as amended (provided each institutional
“accredited investor” or “qualified institutional buyer” meets the Eligibility
Requirements).
“Insurance
Funds” shall have the meaning set forth in Section
6.3.1.
“Insurance
Premiums” shall have the meaning set forth in
Section 5.1.1(b).
“Interest
Period” shall mean, in connection with the calculation of interest
accrued with respect to any specified Monthly Payment Date, the period from
and
including the ninth (9th) day of the prior calendar month to and including
the
eighth (8th) day of the calendar month in which the applicable Monthly Payment
Date occurs; provided, however, that with respect to the
11
Monthly
Payment Date occurring in September, 2007, the Interest Period shall be the
period commencing on the Closing Date to and including October 8,
2007. Each Interest Period, except for the Interest Period ending
October 8, 2007, shall be a full month and shall not be shortened by reason
of
any payment of the Loan prior to the expiration of such Interest
Period. Notwithstanding anything to the contrary, in the event Lender
exercises its right to change the Monthly Payment Date in accordance with
the
terms of the definition thereof, the commencement dates and dates of each
subsequent Interest Period hereunder shall change accordingly whereby the
Interest Period thereafter shall commence on the Monthly Payment Date of
the
preceding calendar month and terminate on the day immediately preceding the
Monthly Payment Date of the current calendar month (by the way of example,
in
the event Lender changes the Monthly Payment Date to the tenth (10th) day
of the
calendar month, the Interest Period thereafter, with respect to any Monthly
Payment Date, shall commence on the tenth (10th) day of the preceding calendar
month and terminate on the ninth (9th) day of the current calendar
month).
“Interest
Rate Protection Agreement” shall mean one or more interest rate
hedge agreements (together with the confirmation and schedules relating thereto)
in form and substance satisfactory to Lender, between Borrower (but only
if such
hedge agreement is a rate cap under which the sole obligation of Borrower
is to
make payment of an up-front premium) or Guarantor (if such hedge agreement
is a
swap agreement or other hedge agreement other than a rate cap under which
the
sole obligation of Borrower is to make payment of an up-front premium) and,
subject to Section 4.1.12, Bank of America N.A. or a Counterparty
reasonably acceptable to Lender with a Minimum Counterparty Rating, and all
amendments, restatements, replacements, supplements and modifications
thereto.
“Interest
Shortfall” shall have the meaning specified in Section
2.4.1(b).
“Issuing
Bank” shall mean, with respect to a Tenant Letter of Credit, the
Person issuing such Tenant Letter of Credit.
“Issuing
Bank Acknowledgment” shall mean a written acknowledgment from an
Issuing Bank acceptable to Lender in form and substance acknowledging the
Lender’s collateral assignment of and security interest in a Tenant Letter of
Credit issued by such Issuing Bank.
“KPMG
Abatement Funds” shall have the meaning specified in Section
6.1.
“KPMG”
shall have the meaning specified in Section 11.22(xv).
“KPMG
Lease” shall mean that certain lease agreement with KPMG LLP, a
Delaware limited liability partnership (formerly known as KPMG Peat Marwick
LLP), as tenant, with respect to space at the Property, dated June 1, 1998,
as
modified, amended, supplemented and in effect from time to time.
“Xxxxxx
Landlord Work” shall have the meaning set forth in Section
6.7.1.
“Xxxxxx
Landlord Work Budget” shall have the meaning set forth in
Section 6.7.2.
“Xxxxxx
Landlord Work Funds” shall have the meaning set forth in Section
6.7.1.
12
“Xxxxxx
& Xxxxxxx Lease” shall mean that certain lease agreement
executed on or before the date hereof with Xxxxxx & Xxxxxxx LLP, as tenant,
for approximately 292,328 square feet of office space and 4,422 square feet
of
storage space at the Property.
“Xxxxxx
& Xxxxxxx Imputed Rent Advance” shall have the meaning set
forth in Section 2.1.8.
“Xxxxxx
& Xxxxxxx U.S. Bank Tower Lease Guarantee” shall mean that
certain Xxxxxx & Xxxxxxx U.S. Bank Tower Lease Guarantee of even date
herewith from Guarantor for the benefit of Lender with respect to the
obligations of Borrower under the Xxxxxx & Xxxxxxx U.S. Bank Tower Lease
Takeover Agreement.
“Xxxxxx
& Xxxxxxx U.S. Bank Tower Lease Takeover Agreement” shall mean
that certain Assignment and Assumption Agreement dated as of June 29, 2007,
entered into between Xxxxxx & Xxxxxxx LLP and Xxxxxxx Partners-355 S. Grand
LLC, a Delaware limited liability company (as predecessor in interest to
Borrower) with respect to payment of rent due under the lease agreements
with
Xxxxxx & Xxxxxxx LLP, as tenant, for space at the U.S. Bank Tower located at
000 Xxxx Xxxxx Xxxxxx, Xxx Xxxxxxx, Xxxxxxxxxx which are described on Exhibit
A
to such Assignment and Assumption Agreement (the “Xxxxxx & Xxxxxxx U.S.
Bank Tower Lease”).
“Lease”
shall mean any lease, sublease or subsublease, letting, license, concession
or
other agreement (whether written or oral and whether now or hereafter in
effect)
pursuant to which any Person is granted a possessory interest in, or right
to
use or occupy all or any portion of any space in the Property, and every
modification, amendment or other agreement relating to such lease, sublease,
subsublease, or other agreement entered into in connection with such lease,
sublease, subsublease, or other agreement and every guarantee of the performance
and observance of the covenants, conditions and agreements to be performed
and
observed by the other party thereto.
“Leasing
Guidelines” shall mean the Leasing Guidelines described in
Schedule IV attached hereto.
“Legal
Requirements” shall mean all applicable federal, state, county,
municipal and other governmental statutes, laws, rules, orders, regulations,
ordinances, judgments, decrees and injunctions of Governmental Authorities
affecting Borrower or the Property or any part thereof or the construction,
use,
alteration or operation thereof, or any part thereof, whether now or hereafter
enacted and in force, including, without limitation, the Americans with
Disabilities Act of 1990, and all permits, licenses and authorizations and
regulations relating thereto, and all applicable covenants, agreements,
restrictions and encumbrances contained in any instruments, either of record
or
known to Borrower, at any time in force affecting the Property or any part
thereof, including, without limitation, any which may (i) require repairs,
modifications or alterations in or to the Property or any part thereof, or
(ii) in any way limit the use and enjoyment thereof.
13
“Lender
Indemnitees” shall have the meaning set forth in Section
11.13(b).
“Lender’s
Notice” shall have the meaning set forth in Section
2.2.3(b).
“Liabilities”
shall have the meaning set forth in Section 9.2.
“LIBOR”
shall mean, with respect to each Interest Period, the rate (calculated by
Lender, expressed as a percentage per annum and rounded upward, if necessary,
to
the next nearest 1/32 of 1%) for deposits in United States dollars for a
one-month period, which appears on Telerate Page 3750 as of 11:00 a.m., London
time, on the applicable Determination Date. If such rate does not
appear on Telerate Page 3750 as of 11:00 a.m., London time, on the applicable
Determination Date, LIBOR for the next Interest Period and such Determination
Date, the Lender will request the principal London office of any four (4)
major
reference banks in the London interbank market selected by the Lender to
provide
such reference bank's offered quotation to prime banks in the London interbank
market for deposits in United States dollars for a one (1) month period as
of
11:00 a.m., London time, on such Determination Date in a principal amount
of not
less than One Million and No/100 Dollars ($1,000,000.00) that is representative
for a single transaction in the relevant market at such time. If at
least two such offered quotations are so provided, LIBOR will be the arithmetic
mean of such quotations. If fewer than two (2) such quotations are so
provided, the Lender will request any three (3) major banks in New York City
selected by the Lender to provide such bank's rate for loans in United States
dollars to leading European banks for a one (1) month period as of approximately
11:00 a.m., New York City time, on the applicable Determination Date for
amounts
in a principal amount of not less than One Million and No/100 Dollars
($1,000,000.00) that is representative for a single transaction in the relevant
market at such time. If at least two (2) such rates are so provided,
LIBOR will be the arithmetic mean of such rates. LIBOR shall be determined
conclusively (absent manifest error) by Lender or its agent.
“LIBOR
Interest Rate” shall mean with respect to each Interest Period the
quotient of (i) LIBOR applicable to the Interest Period divided by (ii) a
percentage equal to 100% minus the Reserve Requirement applicable to the
Interest Period.
“LIBOR
Loan” shall mean the Loan at any time in which the Applicable
Interest Rate is calculated at LIBOR Interest Rate plus the Spread in accordance
with the provisions of Article II hereof.
“Lien”
shall mean any mortgage, deed of trust, lien, pledge, hypothecation, assignment,
security interest, or any other encumbrance, charge or transfer of, on or
affecting any of Borrower’s right, title and/or interest in or to the Property
or any portion thereof or Borrower, or any interest therein, including, without
limitation, any conditional sale or other title retention agreement, any
financing lease having substantially the same economic effect as any of the
foregoing, the filing of any financing statement, and mechanic’s, materialmen’s
and other similar liens and encumbrances.
14
“Loan
Documents” shall mean, collectively, this Agreement, the Notes, the
Mortgage, the Assignment of Leases, the Cash Management Agreement, the
Environmental Indemnity, the Guarantee, the Assignment of Protection Agreement,
the Assignment of Management Agreement and any other document pertaining
to the
Property as well as all other documents now or hereafter executed and/or
delivered in connection with the Loan.
“Loan
to Value Ratio” shall mean the ratio, as of a particular date, in
which the numerator is equal to the outstanding principal balance of the
Debt
and the denominator is equal to the appraised value of the Property based
on an
Appraisal, as determined by Lender in its sole and absolute
discretion.
“Lockout
Period” shall have the meaning set forth in Section
2.4.1.
“London
Business Day” shall mean any day other than a Saturday, Sunday or
any other day on which commercial banks in London, England or New York, New
York
are not open for business.
“Major
Lease” shall mean any Lease (i) covering 25,000 square feet or
more at the Property, (ii) made with a Tenant that is a Tenant under another
Lease at the Property or that is an Affiliate of any other Tenant under a
Lease
at the Property, if the Leases together cover 25,000 square feet or more,
or
(iii) with a Tenant that is paying base rent in an amount equal to or exceeding
five percent (5%) of the Gross Income from Operations.
“Management
Agreement” shall mean that certain management agreement entered
into by and between Borrower and the Manager, pursuant to which the Manager
is
to provide management and other services with respect to the
Property.
“Manager”
shall mean Xxxxxxx Properties, L.P. or any other manager approved in accordance
with the terms and conditions of the Loan Documents.
“Material
Adverse Effect” shall mean any material adverse effect upon
(i) the business operations, economic performance, assets, financial
condition, equity, contingent liabilities, prospects, material agreements
or
results of operations of Borrower, Guarantor or the Property, (ii) the
ability of Borrower or Guarantor to perform all monetary obligations and
perform, in all material respects, its material non-monetary obligations
under
each of the Loan Documents, (iii) the enforceability or validity of any
Loan Document, the perfection or priority of any Lien created under any Loan
Document or the remedies of the Lender under any Loan Document or (iv) the
value of, or cash flow from the Property or the operations thereof.
“Material
Agreements” shall mean (i) each contract and agreement relating to
the ownership, management, development, use, operation, leasing, maintenance,
repair or improvement of the Property (other than the Management Agreement
and
the Leases) that require the payment by Borrower of a minimum annual amount
of
$1,000,000 and (ii) any easements, declarations or covenants, conditions
and/or
restrictions and other agreements which
15
affect
the Property, in law or in equity, including without limitation the
following: (A) the REA; (B) that certain Covenant and Agreement Re –
Central Plant dated as of December 20, 1982, by and between Xxxxxxx
Partners-Xxxxxxx Properties Phase I, a California limited partnership, and
Xxxxxxx Partners-Xxxxxxx Properties-South Tower, a California limited
partnership, recorded in the Official Records on December 22, 1982 as Instrument
No. 00-0000000 (the “Central Plant REA”); (C) that
certain Reciprocal Grant of Easements and Declaration of Establishment of
Restrictions and Covenants – Parcels X-2(a) and X-2(b) dated as of September 25,
1981, by and between Xxxxxxx Partners-Xxxxxxx Properties-South Tower, a joint
venture, The RHF Bunker Hill Corporation, a California non-profit corporation,
and The Community Redevelopment Agency of the City of Los Angeles, California,
a
public body corporate and politic (the “CRA”), and recorded in the Official
Records on February 12, 1982, as Instrument no. 82-160076, as amended by
that
certain First Amendment to Reciprocal Grant of Easements and Declaration
of
Establishment of Restrictions and Covenants – Parcels X-2(a) and X-2(b) and Xxx
0 xx Xxxxx 00000 dated as of November 14, 1986 and recorded in the Official
Records on November 20, 1986 as Instrument No. 00-0000000; (D) that certain
Covenant and Agreement Regarding Maintenance of Off-Street Parking Space
dated
as of July 11, 1988, executed by Xxxxxxx/Xxxxxx Partners-South Tower, a
California limited partnership, and recorded in the Official Records on July
28,
1988, as Instrument No. 00-0000000; (E) that certain Covenant and Agreement
Regarding Maintenance of Off-Street Parking space dated as of July 25, 1988,
executed by System Parking Inc., a California corporation, and Cullen-Los
Angeles, Inc., a California corporation, and recorded in the Official Records
on
November 22, 1989, as Instrument No. 89-1888018; (F) that certain Covenant
and
Agreement Regarding Maintenance of Off-Street Parking Space dated as of July
12,
1988, executed by Xxxxxxx/Xxxxxx Partners-South Tower, a California limited
partnership, and recorded in the Official Records on July 28, 1988, as
Instrument No. 00-0000000; and (G) that certain Agreement Containing Covenants
Affecting Real Property in Connection with Certificate of Completion dated
as of
November 21, 1984, executed by Xxxxxxx Partners-Xxxxxxx Properties-South
Tower,
a California limited partnership, and the CRA and recorded in the Official
Records on November 27, 1984, as Instrument No. 00-0000000.
“Maturity
Date” shall mean October 9, 2012 or such other date on which the
final payment of principal of the Notes become due and payable as therein
or
herein provided, whether at such stated maturity date, by declaration of
acceleration, or otherwise.
“Maximum
Legal Rate” shall mean the maximum non-usurious interest rate, if
any, that at any time or from time to time may be contracted for, taken,
reserved, charged or received on the indebtedness evidenced by the Notes
and as
provided for herein or the other Loan Documents, under the laws of such state
or
states whose laws are held by any court of competent jurisdiction to govern
the
interest rate provisions of the Loan.
“Mezzanine
Borrower” shall have the meaning set forth in Section
11.32.
“Mezzanine
Lender” shall have the meaning set forth in Section
11.32.
“Mezzanine
Loan” shall have the meaning set forth in Section
11.32.
“Mezzanine
Option” shall have the meaning set forth in Section
11.32.
16
“Minimum
Counterparty Rating” shall
mean a credit rating from S&P and Fitch of at least “AA” and from Moody’s of
at least “Aa2;” provided, however, that if Eurohypo AG is the Counterparty, the
Minimum Counterparty Rating shall mean a credit rating from S&P and Fitch of
at least “A” and from Moody’s of at least “Aa3.” .
“Minimum
Disbursement Amount” shall mean Twenty-Five Thousand and No/100
Dollars ($25,000.00).
“Monthly
Payment Date” shall mean the ninth (9th) day
of each calendar month
during the term of the Loan or, if such day is not a Business Day, the
immediately preceding Business Day, provided, however, that Lender shall
have
the right to change the Monthly Payment Date to another day that is not earlier
than the sixth (6th) day
of the calendar month or later than the fifteenth (15th) day of the calendar
month
upon notice to Borrower (in which event such change shall then be deemed
effective on the date so designated in such notice) and, if requested by
Lender,
Borrower shall promptly execute an amendment to this Agreement to evidence
such
change.
“Moody’s”
shall mean Xxxxx’x Investors Service, Inc.
“Mortgage”
shall mean that certain first priority Deed of Trust, Security Agreement
and
Fixture Filing, dated the date hereof, executed and delivered by Borrower
as
security for the Loan and encumbering the Property, as the same may be amended,
restated, replaced, supplemented or otherwise modified from time to
time.
“Mortgage
Borrower” shall have the meaning set forth in Section
11.32.
“Mortgage
Lender” shall have the meaning set forth in Section
11.32.
“Mortgage
Loan” shall have the meaning set forth in Section
11.32.
“Net
Cash Flow” shall mean, for any period, the amount obtained by
subtracting Operating Expenses for such period from Gross Income from Operations
for such period.
“Net
Proceeds” shall mean: (i) the net amount of all
insurance proceeds payable as a result of a Casualty to the Property, after
deduction of reasonable costs and expenses (including, but not limited to,
reasonable attorneys’ fees), if any, in collecting such insurance proceeds, or
(ii) the net amount of the Award, after deduction of reasonable costs and
expenses (including, but not limited to, reasonable attorneys’ fees), if any, in
collecting such Award.
“Net
Proceeds Deficiency” shall have the meaning set forth in
Section 5.3.2(f).
“North
Tower Owner” shall mean North Tower, LLC, a Delaware limited
liability company.
“Note
A” shall have the meaning set forth in
Section 2.1.3.
“Note
A-1” shall have the meaning set forth in
Section 2.1.3.
17
“Note
B Designated Representative” shall mean Eurohypo AG, New York
Branch or a replacement representative designated by the Note B Lenders in
accordance with any applicable co-lender agreement among the Note B
Lenders.
“Note
B Lenders” shall mean, collectively, the holders, from time to
time, of Note B-1 and Note B-2 and any substitute promissory notes
thereto.
“Note
B-1” shall have the meaning set forth in
Section 2.1.3.
“Note
B-2” shall have the meaning set forth in
Section 2.1.3.
“Note
B-2 Lender” shall mean the holders, from time to time, of Note B-2
and any substitute promissory notes thereto.
“Notes”
shall have the meaning set forth in Section 2.1.3.
“Notice”
shall have the meaning set forth in Section 11.6.
“Occupancy”
or “Occupy” or “Occupied” means
(a) with respect to any tenant which is not an Affiliate of Borrower (other
than third party tenants and licensees covered by clause (b) below), such
tenant shall (i) be party to a bona fide arm’s length Lease with an initial
lease term of not less than three (3) years and meeting the standards of
the
Leasing Guidelines, (ii) have accepted (or been deemed to have accepted in
accordance with the terms of its lease) the delivery of all of the space
to be
demised under the terms of its respective lease, including any tenant
improvements to be performed by Borrower, subject in each case to Punch List
Items, and (iii) have actually occupied such space, begun the operation of
its business from such space and paying Rent thereunder, and (b) with
respect to any third party tenant or licensee of the signage or third party
antenna tenants or licensees at the Property, such licensee or tenant, as
applicable, shall have accepted the delivery of all of its respective premises,
including any tenant improvements to be performed by
Borrower. Notwithstanding anything to the contrary set forth above,
those tenants under the leases that are identified on the rent roll delivered
to
Lender in connection with the Closing Date shall be deemed to be in “Occupancy”
on the Closing Date.
“Officer’s
Certificate” shall mean a certificate delivered to Lender by
Borrower which is signed by an authorized senior officer of
Borrower.
“Operating
Agreements” shall mean the REA, and any other covenants,
restrictions or agreements of record relating to the construction, operation
or
use of the Property.
“Operating
Expenses” shall mean, for any period, the total of all expenditures
(computed for purposes of the definition of Historical Net Operating Income
in
accordance with GAAP but for all other purposes under the Loan Documents
on a
cash accounting basis), of whatever kind during such period relating to the
operation, maintenance and management of the Property that are incurred on
a
regular monthly or other periodic basis, including without limitation,
utilities, ordinary repairs and maintenance, insurance premiums, license
fees,
property taxes and assessments, advertising expenses, management fees, payroll
and related taxes,
18
computer
processing charges, tenant improvements, leasing commissions and normalized
capital expenditures (but only to the extent funded from Gross Income from
Operations), operational equipment or other lease payments as approved by
Lender, and other similar costs, but excluding from such calculation
depreciation, debt service and interest costs, Capital Expenditures, and
contributions to Capital Expenditure Funds, the Tax Funds, Insurance Funds,
the
Rollover Funds, the Existing Tenant Improvement Funds and any other reserves
required under the Loan Documents.
“Other
Charges” shall mean all ground rents, maintenance charges,
impositions other than Taxes, and any other charges, including, without
limitation, vault charges and license fees for the use of vaults, chutes
and
similar areas adjoining the Property, now or hereafter levied or assessed
or
imposed against the Property or any part thereof.
“Outside
Future Advance Date” shall mean December 31, 2008, which date shall
be subject to extension as a result of Unavoidable Delay, but not to a date
later than February 28, 2009.
“Patriot
Act” shall mean collectively all laws relating to terrorism or
money laundering, including Executive Order No. 13224 on Terrorist Financing
(effective September 24, 2001) and the Uniting and Strengthening America by
Providing Appropriate Tools Required to Intercept and Obstruct Terrorism
Act of
2001 (Public Law 107-56).
“Permitted
Encumbrances” shall mean, collectively, (i) the Liens and
security interests created by the Loan Documents, (ii) all Liens,
encumbrances and other matters expressly set forth on Schedule A or Schedule
B
of the Title Insurance Policy, (iii) Liens, if any, for Taxes imposed by
any Governmental Authority not yet due or delinquent, and (iv) such other
title and survey exceptions as Lender has approved or may approve in writing
in
Lender’s sole, but good faith discretion, or that are otherwise expressly
permitted by this Agreement or the other Loan Documents.
“Permitted
Fund Manager” means any Person that on the date of determination is
a nationally-recognized manager of investment funds investing in debt or
equity
interests relating to commercial real estate, and in each case is
(a) investing through a fund with committed capital of at least
$250,000,000.00, and (b) not subject to any bankruptcy or other voluntary
or involuntary proceeding, in or out of court, for the adjustment of
debtor-creditor relationships.
“Permitted
Investments” shall have the meaning set forth in the Cash
Management Agreement.
“Permitted
Mezzanine Borrower” means the obligor of any Permitted Mezzanine
Loan, which obligor shall be a wholly-owned subsidiary of Guarantor (or of
another Person who shall have acquired its indirect interest in Borrower
in a
transfer that complies with Article 8 hereof) whose principal asset,
directly or indirectly, shall be the ownership interests in
Borrower.
“Permitted
Mezzanine Lender” means the holder from time to time of a Permitted
Mezzanine Loan (subject to the terms of any applicable intercreditor agreement
that relates to such Permitted Mezzanine Loan).
19
“Permitted
Mezzanine Loan” shall mean
one or more loans from a Permitted Mezzanine Lender to a Permitted Mezzanine
Borrower and secured solely by a pledge of the direct or indirect ownership
interests in Borrower, which loan or loans shall be in compliance with the
terms
and conditions set forth in Section 8.1(j), is evidenced and secured by
loan documents in form and substance acceptable to Lender, has a term expiring
on or after the Maturity Date and is the subject of an intercreditor agreement
between Lender and the proposed lender of such proposed mezzanine loan, which
shall be in form and substance acceptable to Lender.
“Permitted
Mezzanine Loan Liens” means liens in favor of a Permitted Mezzanine
Lender created pursuant to the documents securing a Permitted Mezzanine Loan
and
approved by Lender in connection with such Permitted Mezzanine Loan pursuant
to
the terms of the intercreditor agreement entered into between Lender and
such
Permitted Mezzanine Lender in connection therewith.
“Permitted
Mezzanine Loan Underwritten Amount” means the maximum principal
amount of any Permitted Mezzanine Loan such that such maximum principal amount
(at the time such Permitted Mezzanine Loan is made), when taken together
with
the maximum amount of all other Permitted Mezzanine Loans which will remain
in
effect after such Permitted Mezzanine Loan is made, shall not exceed the
lesser
of (i) the principal amount which would result in an Aggregate Loan to Value
Ratio of 75.3% or less (based on the appraised value of the Property at such
time as determined by Lender in its sole discretion, based on an Appraisal
obtained at Borrower’s sole cost and expense) or (ii) the principal amount which
would result in an Aggregate Debt Service Coverage Ratio of at least 1.00:1.00,
as determined for the trailing twelve (12) month period ending with the last
day
of such month prior to the date on which such Permitted Mezzanine Loan would
be
made. For purposes of determining compliance with the Aggregate Loan
to Value Ratio set forth above, during the twelve (12) month period following
the Closing Date, the Appraised Value of the Property shall be based upon
the
Appraisal obtained by Lender prior to the Closing Date, and during the twelve
(12) month period following Lender’s approval of any other Appraisal, the
Appraised Value of the Property for these purposes shall be based upon such
Appraisal.
“Permitted
Prepayment Date” shall mean the date that is six (6) months after
the Closing Date.
“Person”
shall mean any individual, corporation, partnership, limited liability company,
joint venture, estate, trust, unincorporated association, any other entity,
any
federal, state, county or municipal government or any bureau, department
or
agency thereof and any fiduciary acting in such capacity on behalf of any
of the
foregoing.
“Policy”
shall have the meaning specified in Section 5.1.1(b).
“Prepayment
Date” shall have the meaning specified in Section
2.4.1.
“Prohibited
Person” shall mean any Person:
(i) listed
in the Annex to, or is otherwise subject to the provisions of, the Executive
Order No. 13224 on Terrorist Financing, effective September 24, 2001, and
20
relating
to Blocking Property and Prohibiting Transactions With Persons Who Commit,
Threaten to Commit, or Support Terrorism (the “Executive
Order”);
(ii) that
is owned or controlled by, or acting for or on behalf of, any Person or entity
that is listed in the Annex to, or is otherwise subject to the provisions
of the
Executive Order;
(iii) with
whom Lender is prohibited from dealing or otherwise engaging in any transaction
by any terrorism or money laundering Law, including the Executive
Order;
(iv) who
commits, threatens or conspires to commit or supports “terrorism” as defined in
the Executive Order;
(v) that
is named as a “specially designated national and blocked person” on the most
current list published by the U.S. Treasury Department Office of Foreign
Assets
Control at its official website or at any replacement website or other
replacement official publication of such list; or
(vi) who
is an Affiliate of a Person listed above.
“Prohibited
Transfer” shall have the meaning specified in Section
8.1(a).
“Property”
shall mean, collectively, (a) the parcel of real property located in the
City of
Los Angeles, State of California, the Improvements thereon and all personal
property owned by Borrower and encumbered by the Mortgage, together with
all
rights pertaining to such property and Improvements, all as more particularly
described in the granting clauses of the Mortgage and located at 000 Xxxxx
Xxxxx
Xxxxxx, Xxx Xxxxxxx, Xxxxxxxxxx (commonly referred to as the “KPMG Tower”) and
(b) the parcel of real property located in the City of Los Angeles, State
of
California, the Improvements thereon and all personal property owned by Borrower
and encumbered by the Mortgage, together with all rights pertaining to such
property and Improvements, all as more particularly described in the granting
clauses of the Mortgage and located at 000 Xxxxx Xxxx Xxxxxx, Xxx Xxxxxxx,
Xxxxxxxxxx (commonly referred to as the “X-2 Parking
Structure”).
“Property
Condition Report” shall mean that certain Property Condition Report
prepared by EMG, dated August 14, 2007.
“Property
Insurance Sharing Agreement” shall mean that certain Amended and
Restated Property Insurance Sharing Agreement, dated as of June 27, 2003,
between Borrower’s predecessor in interest, REIT and certain of their respective
Affiliates, as amended by that certain First Amendment to at he Amended and
Restated Property Insurance Sharing Agreement dated as of December 15,
2003.
“Proposed
Lender” shall have the meaning set forth in Section
2.2.3(d).
“Rating
Agencies” shall mean, prior to the final Securitization of the
Loan, each of S&P, Xxxxx’x and Fitch, or any other nationally-recognized
statistical rating agency which has been
21
designated
by Lender and, after the final Securitization of the Loan, shall mean any
of the
foregoing that have rated any of the Securities.
“Rating
Agency Confirmation” shall mean a written affirmation from each of
the Rating Agencies that the credit rating of the Securities by such Rating
Agency immediately prior to the occurrence of the event with respect to which
such Rating Agency Confirmation is sought will not be qualified, downgraded
or
withdrawn as a result of the occurrence of such event, which affirmation
may be
granted or withheld in such Rating Agency’s sole and absolute
discretion.
“REA”
shall mean, collectively, as the same may be amended, restated, supplemented
or
otherwise modified from time to time, those certain agreements more specifically
described on Schedule V attached hereto and made a part hereof.
“Recourse
Guarantee” shall mean that certain Recourse Guarantee of even date
herewith from Guarantor for the benefit of Lender.
“Registration
Statement” shall have the meaning set forth in
Section 9.2(b).
“REMIC
Trust” shall mean a “real estate mortgage investment conduit”
within the meaning of Section 860D of the Code that holds the Loan (or if
applicable, Note A).
“Regulation
D” shall mean Regulation D of the Board of Governors of the Federal
Reserve System from time to time in effect, including any successor or other
Regulation or official interpretation of said Board of Governors relating
to
reserve requirements applicable to member banks of the Federal Reserve
System.
“REIT”
shall mean Xxxxxxx Properties, Inc., a Maryland real estate investment
trust.
“Related
Entity” means, as to any Person, (a) any Affiliate of such
Person; (b) any other Person into which, or with which, such Person is
merged, consolidated or reorganized, or which is otherwise a successor to
such
Person by operation of law, or which acquires all or substantially all of
the
assets of such Person; (c) any other Person which is a successor to the
business operations of such Person and engages in substantially the same
activities; or (d) any Affiliate of the Persons described in
clause (b) or (c) of this definition.
“Related
Loan” shall mean a loan made to an Affiliate of Borrower or secured
by a Related Property, which is included in a Securitization with the
Loan.
“Related
Property” shall mean a parcel of real property, together with
improvements thereon and personal property related thereto, that is “related”,
within the meaning of the definition of Significant Obligor, to the
Property.
“Rents”
shall mean all rents (including, without limitation, percentage rents and
additional rents payable by tenants representing pass-throughs of common
area
maintenance expenses, insurance premiums, utility charges, taxes and
assessments), rent equivalents, moneys payable as damages or in lieu of rent
or
rent equivalents, royalties (including, without limitation, all oil and gas
or
other mineral royalties and bonuses), income, receivables, receipts, revenues,
22
deposits
(including, without limitation, any Tenant Letter of Credit, security, utility
and other deposits), accounts, cash, issues, profits, charges for services
rendered, and other consideration of whatever form or nature received by
or paid
to or for the account of or benefit of Borrower or its agents or employees
from
any and all sources arising from or attributable to the Property, and proceeds,
if any, from business interruption or other loss of income
insurance.
“Requesting
Lender” shall have the meaning set forth in Section
2.2.3(d).
“Reserve
Funds” shall mean, collectively, the KPMG Abatement Funds, the
Capital Expenditure Funds, the Insurance Funds, the Tax Funds, the Rollover
Funds, the Sweep Account, and the Existing Tenant Improvement
Funds.
“Reserve
Requirements” means with respect to any Interest Period, the
maximum rate of all reserve requirements (including, without limitation,
all
basic, marginal, emergency, supplemental, special or other reserves and taking
into account any transitional adjustments or other schedule changes in reserve
requirements during the Interest Period) which are imposed under
Regulation D on eurocurrency liabilities (or against any other category of
liabilities which includes deposits by reference to which LIBOR is determined
or
against any category of extensions of credit or other assets which includes
loans by a non-United States office of a depository institution to United
States
residents or loans which charge interest at a rate determined by reference
to
such deposits) during the Interest Period and which are applicable to member
banks of the Federal Reserve System with deposits exceeding one billion dollars,
but without benefit or credit of proration, exemptions or offsets that might
otherwise be available from time to time under Regulation D. The
determination of the Reserve Requirements shall be based on the assumption
that
Lender funded 100% of the Loan in the interbank eurodollar market. In
the event of any change in the rate of such Reserve Requirements under
Regulation D during the Interest Period, or any variation in such
requirements based upon amounts or kinds of assets or liabilities, or other
factors, including, without limitation, the imposition of Reserve Requirements,
or differing Reserve Requirements, on one or more but not all of the holders
of
the Loan or any participation therein, Lender may use any reasonable averaging
and/or attribution methods which it deems appropriate and practical for
determining the rate of such Reserve Requirements which shall be used in
the
computation of the Reserve Requirements. Lender’s computation of same
shall be final absent manifest error. Reserve Requirements hereunder
shall not exceed any reserve requirements determined by Lender for other
loans
similar to this Loan.
“Restoration”
shall have the meaning set forth in Section 5.2.1.
“Restoration
Threshold” shall mean Three Million Dollars
($3,000,000).
“Restricted
Party” shall mean Borrower, Borrower Principal, any SPC Party (if
any), any Affiliated Manager, or any shareholder, partner, member or non-member
manager, or any direct or indirect legal or beneficial owner of Borrower,
Borrower Principal, any Affiliated Manager or any non-member
manager.
“Rollover
Funds” shall have the meaning set forth in
Section 6.5.1.
23
“Sale
or Pledge” shall mean a voluntary or involuntary sale, conveyance,
mortgage, grant, bargain, encumbrance, pledge, assignment, grant of any options
with respect to, or any other transfer or disposition of (directly or
indirectly, voluntarily or involuntarily, by operation of law or otherwise,
and
whether or not for consideration or of record) of a direct or indirect legal
or
beneficial interest of (i) the Property, (ii) any partnership interest in
any
general partner in Borrower that is a partnership, (iii) any membership interest
in any member in Borrower that is a limited liability company and (iv) any
voting stock in any general partner in Borrower that is a
corporation.
“Secondary
Market Transaction” shall have the meaning set forth in
Section 9.1(a).
“Securities”
shall have the meaning set forth in Section 9.1(a).
“Securities
Act” shall have the meaning set forth in
Section 9.2.
“Securitization”
shall have the meaning set forth in Section 9.1(a).
“Seismic
Analysis” shall mean that certain Probable Maximum Loss Report
prepared by EMG, dated August 15, 2007.
“Servicer”
shall have the meaning set forth in Section 11.24(a).
“Servicing
Agreement” shall have the meaning set forth in Section
11.24(a).
“Severed
Loan Documents” shall have the meaning set forth in
Section 10.2(c).
“Significant
Obligor” shall have the meaning set forth in Item 1101(k) of
Regulation AB under the Securities Act.
“SPC
Party” shall have the meaning set forth in
Section 3.1.24(p).
“Sponsor”
shall mean Xxxxxxx Properties, L.P., a Maryland limited
partnership.
“Spread”
shall mean, with respect to any Note, the Spread stated in such
Note.
“Spread
Maintenance Premium” shall mean, in connection with a prepayment of
all or any portion of the outstanding principal balance of the Loan pursuant
to
Section 2.3.3 hereof, an amount equal to the present value,
discounted at LIBOR on the most recent Determination Date, of all future
installments of interest which would have been due hereunder through and
including the Permitted Prepayment Date on the portion of the outstanding
principal balance of the Loan being prepaid as if interest accrued on such
portion of the principal balance being prepaid at an interest rate per annum
equal to the Spread. The Spread Maintenance Premium shall be
calculated by Lender and shall be final absent manifest error.
24
“Substitute
Rate” shall have the meaning set forth in Section
2.2.3(b).
“Substitute
Rate Loan” shall mean the Loan at any time in which the Applicable
Interest Rate is calculated at the Substitute Rate plus the Substitute Spread
in
accordance with the provisions of Article II hereof.
“Substitute
Spread” shall have the meaning set forth in Section
2.2.3(b).
“Survey”
shall mean a current land survey (or surveys) for the Property, certified
to the
title company and Lender and its successors and assigns, in form and content
satisfactory to Lender and prepared by a professional and properly licensed
land
surveyor satisfactory to Lender in accordance with the 1999 Minimum Standard
Detail Requirements for ALTA/ACSM Land Title Surveys (i) meeting the
classification of an “Urban Survey” and the following additional items from the
list of “Optional Survey Responsibilities and Specifications” (Table A) should
be added to each survey: 2, 3, 4, 6, 8, 9, 10, 11 and 13, (ii)
reflecting a metes and bounds description of the real property comprising
part
of the Property in conformity with the Title Insurance Policy, and (iii)
together with the surveyor’s seal affixed to the Survey and a certification from
the surveyor in form and substance acceptable to Lender.
“Tax
Funds” shall have the meaning set forth in
Section 6.2.1.
“Taxes”
shall mean all real estate and personal property taxes, assessments, water
rates
or sewer rents, now or hereafter levied or assessed or imposed against the
Property or part thereof, together with all interest and penalties
thereon.
“Telerate
Page 3750” shall mean the display designated as "Page 3750" on the
Dow Xxxxx Telerate Service (or such other page as may replace Page 3750 on
that
service or such other service as may be nominated by the British Bankers'
Association as the information vendor for the purpose by displaying British
Bankers' Association Interest Settlement Rates for U.S. Dollar
deposits).
“Tenant”
shall mean any Person obligated by contract or otherwise to pay monies
(including a percentage of gross income, revenue or profits) under any Lease
now
or hereafter affecting all or any part of the Property.
“Tenant
Letter of Credit” shall mean each Letter of Credit delivered by a
Tenant to Borrower or its predecessor in interest as security for such Tenant’s
obligations under its Lease.
“TI/LC
Advance” shall have the meaning set forth in
Section 2.1.7.
“TI/LC
Maximum Advance Amount” shall have the meaning set forth in
Section 2.1.7.
“Title
Insurance Policy” shall mean an ALTA mortgagee title insurance
policy in the form acceptable to Lender issued with respect to the Property
and
insuring the lien of the Mortgage together with such endorsements and
affirmative coverages as Lender may require.
25
“Trustee”
shall mean any trustee holding the Loan (or, if applicable, Note A) in a
Securitization.
“Turnover
Date” shall have the meaning specified in Section
11.22(xv).
“UCC”
or “Uniform Commercial Code” shall mean the Uniform
Commercial Code as in effect in the State.
“Unavoidable
Delay” shall mean any delay due to strikes, acts of God, fire,
earthquake, floods, explosion, actions of the elements, other accidents or
casualty, declared or undeclared war, riots, mob violence, acts of terrorism,
inability to procure or a general shortage of labor, equipment, facilities,
energy, materials or supplies in the open market, failure of transportation,
lockouts, actions of labor unions, condemnation, court orders, laws, rules,
regulations or orders of any Governmental Authority or other cause beyond
the
reasonable control of Borrower; provided that, in each of the foregoing cases,
(a) such cause is not within the control of Borrower, (b) Borrower
gives notice of such delay to the Lender within ten (10) days of occurrence
of the event resulting in such delay and, after the initial notification,
promptly after request of the Lender, notifies the Lender of the status of
such
delay, and (c) Borrower uses all commercially reasonable efforts to
mitigate the delay caused by such event of Unavoidable Delay. For the
purposes hereof, Unavoidable Delays shall not include delays caused by
Borrower’s lack of or inability to procure monies to fulfill Borrower’s
commitments and obligations under this Agreement or the other Loan
Documents.
“Underwriter
Group” shall have the meaning set forth in
Section 9.2.
“Updated
Information” shall have the meaning set forth in
Section 9.1(b)(i).
“U.S.
Obligations” shall mean direct full faith and credit obligations of
the United States of America that are not subject to prepayment, call or
early
redemption.
“Xxxxx
Fargo Center” shall mean the Property and that certain real
property and improvements commonly known as 000 X. Xxxxx Xxxxxx, Xxx Xxxxxxx,
Xxxxxxxxxx.
Section
1.2. Principles
of Construction.
All
references to sections and schedules are to sections and schedules in or
to this
Agreement unless otherwise specified. Unless otherwise specified, the
words “hereof,” “herein” and “hereunder” and words of similar import when used
in this Agreement shall refer to this Agreement as a whole and not to any
particular provision of this Agreement. Unless otherwise specified,
all meanings attributed to defined terms herein shall be equally applicable
to
both the singular and plural forms of the terms so defined.
26
|
|
THE
LOAN
|
Section
2.1. The
Loan.
2.1.1 Agreement
to Lend and Borrow. Subject to and upon the terms and
conditions set forth herein, Lender shall make the Loan to Borrower and Borrower
shall accept the Loan from Lender on the Closing Date.
2.1.2 Single
Disbursement to Borrower. Subject to Future Advances,
Borrower shall receive only one (1) borrowing hereunder in respect of the
Loan. Any amount borrowed and repaid hereunder in respect of the Loan
may not be reborrowed.
2.1.3 The
Notes. The Loan shall be evidenced by that certain
Promissory Note A-1 of even date herewith (as the same may hereafter be amended,
supplemented, restated, increased, extended or consolidated from time to
time
“Note A-1”); Promissory Note A-2 of even date herewith
(as the same may hereafter be amended, supplemented, restated, increased,
extended or consolidated from time to time “Note A-2”);
Promissory Note B-1 of even date herewith (as the same may hereafter be amended,
supplemented, restated, increased, extended or consolidated from time to
time
“Note B-1”); and Promissory Note B-2 of even date
herewith (as the same may hereafter be amended, supplemented, restated,
increased, extended or consolidated from time to time “Note
B-2”); Note X-0, Xxxx X-0, Xxxx X-0 and Note B-2, together with
any
substitutes therefor, are collectively referred to herein as the
“Notes”, Note A-1 and Note A-2, together with any
substitutes therefor, are collectively referred to as “Note
A”, and Note B-1 and Note B-2, together with any substitutes
therefor, are collectively referred to as “Note
B”. Note A-1 shall be in the stated principal amount of
Two Hundred Thirty Million Six Hundred Twenty-Three Thousand Seven Hundred
Thirteen and No/100 Dollars ($230,623,713.00), Note A-2 shall be in the stated
principal amount of One Hundred Twenty-Eight Million One Hundred Seventy-Six
Thousand Two Hundred Eighty-Seven and No/100 Dollars ($128,176,287.00), Note
B-1
shall be in the stated principal amount of Six Million Ninety-Four Thousand
Five
Hundred Twenty-Six and 88/100 Dollars ($6,094,526.88) and Note B-2 shall
be in
the maximum principal amount of Thirty-Five Million One Hundred Five Thousand
Four Hundred Seventy Three and 12/100 Dollars ($35,105,473.12), each executed
by
Borrower and payable to the order of Lender in evidence of the
Loan. The Loan shall be repaid in accordance with the terms of this
Agreement and the Notes.
2.1.4 Use
of Proceeds. Borrower shall use proceeds of the Loan to
(a) refinance any existing loans relating to the Property, (b) pay
all past-due Basic Carrying Costs, if any, in respect of the Property,
(c) deposit the Reserve Funds, (d) pay costs and expenses incurred in
connection with the closing of the Loan, as approved by Lender, (e) fund
any working capital requirements of the Property, as approved by Lender
(f) in the case of the Future Advances, pay the amounts required to be paid
with the proceeds thereof, as provided in this Agreement, (g) pay any other
amounts specifically permitted by this Agreement, and (h) distribute the
balance
of the proceeds, if any to Borrower.
2.1.5 Initial
Advance of Loan Amount. On the date hereof, Lender shall make an
initial advance of a portion of the Loan Amount in the amount of not more
than
Three Hundred Sixty-Four Million Eight Hundred Ninety-Four Thousand Five
Hundred
Twenty-Six
27
and
88/100 Dollars ($364,894,526.88). Such advance shall be evidenced by
Note A and Note B-1.
2.1.6 Conditions
Precedent for Future Advances. Note B-2 Lender’s
obligation to make any Future Advance is subject to the satisfaction of the
following conditions:
(a) Minimum
Amount of Advance Request. During any calendar month, any Advance
Request for a Future Advance shall be for no less than One Hundred Thousand
and
No/100 Dollars ($100,000) (or, if less, the full amount of the unfunded TI/LC
Maximum Advance Amount or Maximum Xxxxxx & Xxxxxxx Imputed Rent Amount, as
applicable).
(b) Title
Policy Endorsement. Lender shall have received an endorsement to
the title insurance policy delivered to Lender in connection with the closing
of
the Loan, in form reasonably acceptable to Lender, redating the date of such
policy to be as of the date of the Future Advance and, if necessary, increasing
the amount insured thereby to the amount of the Loan Amount then advanced,
without additional exception.
(c) No
Event of Default. No Event of Default shall exist on the date of
the Advance Request for any Future Advance or on the date the Future Advance
is
actually made.
(d) Secured
Amount. Each Future Advance shall be considered an advance of the
Loan Amount, shall be added to the unpaid principal balance of the Loan as
of
the day such advance is made for purposes of Borrower’s payment obligations
under this Agreement, and repayment thereof, together with interest thereon,
shall be secured by the Mortgage and other collateral given for the
Loan.
No
waiver
given by Note B-2 Lender of any condition precedent to a Future Advance shall
preclude Note B-2 Lender from requiring that such condition be satisfied
prior
to making any other Future Advance.
2.1.7 Additional
TI/LC Advances. Upon the satisfaction (or waiver in
writing by Note B-2 Lender) of the conditions pursuant to Section 2.1.6
and this Section 2.1.7, Note B-2 Lender shall make to Borrower advances
for payment of tenant improvement expenses and leasing commissions incurred
by
Borrower pursuant to the Xxxxxx & Xxxxxxx Lease (each, a “TI/LC
Advance”) in the aggregate amount of up to Twenty-One Million Two
Hundred Five Thousand Four Hundred Seventy-Three and 12/100 Dollars
($21,205,473.12) (the “TI/LC Maximum Advance Amount”).
Each TI/LC Advance shall be considered an advance of the Loan, shall be added
to
the unpaid principal balance of the Loan as of the day such advance is made
and
shall be evidenced by Note B-2, and repayment thereof, together with interest
thereon, shall be secured by the Mortgage and other collateral given for
the
Loan. The following conditions apply to each TI/LC
Advance:
(a) Permissible
Uses. TI/LC Advances shall be used only for payment of tenant
improvement expenses and leasing commissions incurred by Borrower pursuant
to
the Xxxxxx & Xxxxxxx Lease and payable to Persons unaffiliated with
Borrower, and approved (or deemed approved) pursuant to this Agreement; provided
that up to $204,629.60 may be paid to
28
the
Manager for tenant improvement supervision/coordination fees in accordance
with
the Management Agreement.
(b) Disbursement
Requirements. Together with each Advance Request for a TI/LC
Advance, Borrower shall furnish Lender and Note B-2 Lender with copies of
bills
and other documentation (including lien releases or lien releases conditioned
only upon payment) reasonably required by Note B-2 Lender (and consistent
with
the documentation required to be delivered under the Xxxxxx & Xxxxxxx Lease)
to establish that the related tenant improvement expenses and leasing
commissions have actually been incurred in accordance with the Xxxxxx &
Xxxxxxx Lease, that any work relating thereto has been completed and that
such
amounts that are then due and payable or have been paid. Note B-2
Lender shall approve or disapprove any Advance Request (and, if approved,
make
the related TI/LC Advance to Borrower or Borrower’s designee) within ten (10)
Business Days after Note B-2 Lender’s receipt of such Advance
Request.
(c) Lien
Free. Note B-2 Lender is satisfied that, in accordance with the
Xxxxxx & Xxxxxxx Lease, the tenant improvements are being constructed Lien
free, substantially in accordance with the tenant improvement plans approved
in
accordance with the Xxxxxx & Xxxxxxx Lease, and withholding such
disbursement is whole or in part is not required under any applicable lien
law.
(d) Access. Borrower
shall have provided Note B-2 Lender, and any consultant on behalf of Note
B-2
Lender, prompt and reasonable access to the Property (in accordance with
Borrower’s rights under the Xxxxxx & Xxxxxxx Lease) in order to inspect the
tenant improvement work then completed.
In
the
event that the Borrower has not drawn on the full amount of the TI/LC Maximum
Advance Amount on or before the Outside Future Advance Date, Note B-2 Lender’s
commitment to advance the then unfunded portion of the TI/LC Maximum Amount
shall be of no further force or effect.
Note
B-2
Lender shall have the right to delegate in writing all of its approval rights
under this Section 2.1.7 to the Note B Designated
Representative. In such case, from and after the date on which
written notice of such delegation is delivered to Borrower, all notices,
requests and other materials to be delivered to Note B-2 Lender under this
Section 2.1.7 shall be delivered to the Note B Designated Representative
in accordance with written instructions delivered by Note B-2 Lender to
Borrower, and all notices received by Borrower from the Note B Designated
Representative shall be binding on Note B-2 Lender.
2.1.8 Additional
Xxxxxx & Xxxxxxx Imputed Rent Advances. From and
after the Closing Date, so long as the conditions pursuant to Section
2.1.6 and this Section 2.1.8 are satisfied (or waived in writing by
Note B-2 Lender), and until (but not including) the date on which the Xxxxxx
& Xxxxxxx Lease is commenced, tenant takes occupancy, and payment of rent is
actually made thereunder (the “Xxxxxx & Xxxxxxx Commencement
Date”), Note B-2 Lender shall make to Borrower advances (each, a
“Xxxxxx & Xxxxxxx Imputed Rent Advance”; the Xxxxxx
& Xxxxxxx Imputed Rent Advance and TI/LC Advance
are collectively referred
to herein as “Future Advances”) in an amount not to
exceed in the aggregate, with
29
respect
to all such Xxxxxx & Xxxxxxx Imputed Rent Advances, the sum of Thirteen
Million Nine Hundred Thousand and No/100 Dollars ($13,900,000.00) (the
“Maximum Xxxxxx & Xxxxxxx Imputed Rent Advance
Amount”). Each Xxxxxx & Xxxxxxx Imputed Rent
Advance shall be considered an advance of the Loan, shall be added to the
unpaid
principal balance of the Loan as of the day such advance is made for purposes
of
Borrower’s payment obligations under this Agreement, and repayment thereof,
together with interest thereon, shall be secured by the Mortgage and other
collateral given for the Loan. The following additional terms and
provisions apply to each Xxxxxx & Xxxxxxx Imputed Rent Advance:
(a) Xxxxxx
& Xxxxxxx Imputed Rent Advance on Monthly Payment Date. Note
B-2 Lender shall, provided Lender and Note B-2 Lender receive written request
from Borrower delivered not later than five (5) Business Days prior to the
pending Monthly Payment Date, make a Xxxxxx & Xxxxxxx Imputed Rent Advance
to Borrower on such Monthly Payment Date. The amount of such Xxxxxx
& Xxxxxxx Imputed Rent Advance shall be in the amount requested by Borrower,
not to exceed the amount that would have been due, on the first day of the
month
in which such Monthly Payment Date occurs, in monthly rent (inclusive of
base
rent, anticipated operating expense reimbursements and anticipated contributions
to parking revenues) under the Xxxxxx & Xxxxxxx Lease, as if the first day
of the first full month after the Closing Date were the date on which the
obligation of the tenant to pay rent under the Xxxxxx & Xxxxxxx Lease
commenced, as certified by Borrower to Lender and Note B-2 Lender in its
applicable Advance Request. The amount of each such Xxxxxx &
Xxxxxxx Imputed Rent Advance shall be advanced directly by Note B-2 Lender
for
credit to the account of Borrower in partial payment of the interest due
and
payable under the Notes on the Monthly Payment Date on which such amount
is
advanced. Note B-2 Lender’s failure to make a Xxxxxx & Xxxxxxx
Imputed Rent Advance shall not relieve Borrower of its obligation to pay
all
amounts due in accordance with this Agreement on any Monthly Payment
Date. Subject to Section 2.18(b) below, Note B-2 Lender shall
have no obligation to make any Xxxxxx & Xxxxxxx Imputed Rent Advance after
the Xxxxxx & Xxxxxxx Commencement Date.
(b) Funding
of Remaining Imputed Rent Advance Amount. In the event that the
Borrower has not drawn the full amount of the Maximum Xxxxxx & Xxxxxxx
Imputed Rent Advance Amount on or before the Xxxxxx & Xxxxxxx Commencement
Date, the remainder of the Maximum Xxxxxx & Xxxxxxx Imputed Rent Advance
Amount not yet advanced shall be advanced to Borrower by Note B-2 Lender
on the
Monthly Payment Date immediately following the Xxxxxx & Xxxxxxx Commencement
Date, provided that Borrower shall have delivered to Lender and Note B-2
Lender
an Advance Request therefor at least five (5) Business Days prior to such
Monthly Payment Date; no Event of Default then exists, and Borrower shall
have
delivered to Note B-2 Lender an estoppel certificate duly executed by Xxxxxx
& Xxxxxxx, certifying that the Xxxxxx & Xxxxxxx Lease has commenced,
setting forth the commencement date thereunder and certifying that Xxxxxx
&
Xxxxxxx has unconditionally accepted all premises demised under the Xxxxxx
&
Xxxxxxx Lease and that no default or event of default on the part of Borrower
or
Xxxxxx & Xxxxxxx exists thereunder, and otherwise in form and substance
reasonably satisfactory to Note B-2 Lender. If Borrower does not
satisfy the above conditions on the first Monthly Payment Date immediately
following the Xxxxxx & Xxxxxxx Commencement Date, such advance may occur on
the first Monthly Payment Date thereafter upon which the above conditions
are
satisfied, so long as such conditions are satisfied on or before the Outside
Future Advance Date. If Borrower has not drawn the full amount of
the
30
Maximum
Xxxxxx & Xxxxxxx Imputed Rent Advance Amount on or before the Outside Future
Advance Date, Note B-2 Lender’s commitment to advance the then unfunded portion
of the Maximum Xxxxxx & Xxxxxxx Imputed Rent Advance Amount shall be of no
further force or effect.
(c) Note
B-2 Lender shall have the right to delegate in writing all of its approval
rights under this Section 2.1.8 to the Note B Designated
Representative. In such case, from and after the date on which
written notice of such delegation is delivered to Borrower, all notices,
requests and other materials to be delivered to Note B-2 Lender under this
Section 2.1.8 shall be delivered to the Note B Designated Representative
in accordance with written instructions delivered by Note B-2 Lender to
Borrower, and all notices received by Borrower from the Note B Designated
Representative shall be binding on Note B-2 Lender.
2.1.9 Separate
Contract for Advances. Note B-2 Lender’s obligations to
perform in accordance with Sections 2.1.7 and 2.1.8 of this Loan
Agreement and to make any Future Advance in accordance with the terms and
provisions of this Agreement are an independent contract made by Note B-2
Lender
to Borrower separate and apart from any other obligation of any other Lender
to
Borrower under the other provisions of this Agreement and the other Loan
Documents. The obligations of Borrower under this Agreement and the
other Loan Documents shall not be reduced, discharged or released because
or by
reason of any existing or future offset, claim or defense of Borrower, or
any
other party, against Note B-2 Lender by reason of Note B-2 Lender’s failure to
perform its obligations under Section 2.1.7 or
2.1.8. Borrower acknowledges that Lender has the right, as
Lender determines in its sole discretion, to include Note A (or any portion
thereof) and Note B (or any portion thereof) in separate sales or Secondary
Market Transaction(s) undertaken by Lender and in connection with such sale(s)
or Secondary Market Transaction(s) all of the terms and provisions contained
in
this Agreement and the Loan Documents shall continue in full force and
effect. Notwithstanding anything to the contrary contained herein,
the holders of Note A and Note B-1 shall have no obligation hereunder to
make
any Future Advance, it being acknowledged that the obligation to make any
Future
Advance shall solely be the obligation of the holder of Note
B-2. Notwithstanding the foregoing, in the event that Note B-2 is
severed into two or more separate notes, the obligation to make any Future
Advance shall be the several obligation of each holder of such severed Note
B-2,
in proportion to the respective commitment amounts of such holders, and the
holder of any severed portion of Note B-2 shall have no obligation hereunder
to
make any Future Advance other than in the aggregate amount of such holder’s
unfunded commitment amount and in accordance with such holder’s respective
proportional share of the amount of each Future Advance. No claim may
be made by Borrower against the holder of any Note or the directors, officers,
employees, attorneys or agents of the holder of any Note for any damages
of any
nature whatsoever in respect of any claim whatsoever for breach by any Note
B-2
Lender of its obligations to make a Future Advance in accordance with the
terms
hereof (except for a claim made exclusively against such breaching Note B-2
Lender), and Borrower hereby waives, releases and agrees not to xxx the holder
of any Note (except for such breaching Note B-2 Lender) upon any claim for
any
such damages. All Future Advances shall be evidenced by Note
B-2. Subject to the foregoing, any obligations and rights relating to
Future Advances pursuant to Sections 2.1.7, 2.1.8 and
this Section 2.1.9 shall be the sole obligations and rights of the holder
of Note B-2, and any reference to Lender in this Section 2.1.9 relating
to any Future Advance shall be deemed to mean the holder of Note
B-2.
31
2.2.1 Applicable
Interest Rate. Except as herein provided with respect to
interest accruing at the Default Rate, interest on the outstanding principal
balance of the Loan shall accrue from the Closing Date to and including the
Maturity Date at the Applicable Interest Rate.
2.2.2 Interest
Calculation. Interest on the outstanding principal
balance of the Loan shall be calculated by multiplying (a) the actual
number of days elapsed in the period for which the calculation is being made
by
(b) a daily rate based on a three hundred sixty (360) day year (that is,
the Applicable Interest Rate or the Default Rate, as then applicable, expressed
as an annual rate divided by 360) by (c) the outstanding principal
balance.
2.2.3 Determination
of Interest Rate.
(a) Any
change in the rate of interest hereunder due to a change in the Applicable
Interest Rate shall become effective as of the first day of the new Interest
Period. Each determination by Lender of the Applicable Interest Rate
shall be conclusive and binding for all purposes, absent manifest
error.
(b) In
the event that Lender shall have reasonably determined (which determination
shall be conclusive and binding upon Borrower absent manifest error) that
by
reason of circumstances affecting the interbank eurodollar market, adequate
and
reasonable means do not exist for ascertaining LIBOR, then Lender shall,
by
notice to Borrower (“Lender’s Notice”), which notice
shall set forth in reasonable detail such circumstances, establish the
Applicable Interest Rate for the respective portions of the Loan evidenced
by
each of the Notes at the then customary spread (the “Substitute
Spread”), taking into account the size and respective priorities of
the portions of the Loan evidenced by the Note and the creditworthiness of
Borrower, above a published index used for variable rate loans as reasonably
determined by Lender (the “Substitute
Rate”).
(c) If,
pursuant to the terms of this Agreement, the Loan has been converted to a
Substitute Rate Loan and Lender shall determine (which determination shall
be
conclusive and binding upon Borrower absent manifest error) that the event(s)
or
circumstance(s) which resulted in such conversion shall no longer be applicable,
Lender shall give notice thereof to Borrower, and the Substitute Rate Loan
shall
automatically convert to a LIBOR Loan on the first day of the Interest Period
next following the effective date set forth in such
notice. Notwithstanding any provision of this Agreement to the
contrary, in no event shall Borrower have the right to elect to convert a
LIBOR
Loan to a Substitute Rate Loan.
(d) With
respect to a LIBOR Loan, all payments made by Borrower hereunder shall be
made
free and clear of, and without reduction for or on account of, income, stamp
or
other taxes, levies, imposts, duties, charges, fees, deductions, reserves
or
withholdings imposed, levied, collected, withheld or assessed by any
Governmental Authority, which are imposed, enacted or become effective after
the
date hereof (such non-excluded taxes being referred to collectively as
“Foreign Taxes”), excluding income and franchise taxes
of the United States of America or any political subdivision or taxing authority
thereof or therein (including
32
Puerto
Rico). If any Foreign Taxes are required to be withheld from any
amounts payable to Lender hereunder, the amounts so payable to Lender shall
be
increased to the extent necessary to yield to Lender (after payment of all
Foreign Taxes) interest or any such other amounts payable hereunder at the
rate
or in the amounts specified hereunder. Whenever any Foreign Tax is
payable pursuant to applicable law by Borrower, as promptly as possible
thereafter, Borrower shall send to Lender an original official receipt, if
available, or certified copy thereof showing payment of such Foreign
Tax. Borrower hereby indemnifies Lender for any incremental taxes,
interest or penalties that may become payable by Lender which may result
from
any failure by Borrower to pay any such Foreign Tax when due to the appropriate
taxing authority or any failure by Borrower to remit to Lender the required
receipts or other required documentary evidence. If any Lender, other
than a REMIC Trust, requests compensation pursuant to this Section
2.2.3(d) (any such Lender, other than a REMIC Trust, requesting such
compensation, or whose obligations are so suspended, being herein called
a
“Requesting Lender”), Borrower, upon three (3)
Business Days’ notice, may require that such Requesting Lender transfer all of
its right, title and interest under this Agreement and such Requesting Lender’s
Note to an Eligible Assignee (a “Proposed Lender”)
identified by Borrower that is satisfactory to the Note B Designated
Representative, (i) if such Proposed Lender agrees to assume all of
the obligations of such Requesting Lender hereunder in accordance with
Section 11.27, and to purchase all of such Requesting Lender’s Loans
hereunder for consideration equal to the aggregate outstanding principal
amount
of such Requesting Lender’s Loans, together with interest thereon to the date of
such purchase (to the extent not paid by Borrower), and satisfactory
arrangements are made for payment to such Requesting Lender of all other
amounts
accrued and payable hereunder to such Requesting Lender as of the date of
such
transfer (including any fees accrued hereunder as if all of such Requesting
Lender’s Loans were being prepaid in full on such date) and (ii) if such
Requesting Lender has requested compensation pursuant to this Section
2.2.3(d), such Proposed Lender’s aggregate requested compensation, if any,
pursuant to this Section 2.2.3(d) with respect to such Requesting
Lender’s Loans is lower than that of the Requesting Lender. Upon the
assignment and assumption of such Requesting Lender’s interest pursuant to the
provisions of Section 11.27, such Proposed Lender shall be a
“Lender” for all purposes hereunder. Without
prejudice to the survival of any other agreement of Borrower hereunder, the
agreements of Borrower contained in this Section 2.2.3(d) and any other
provisions of this Agreement with respect to payment of expenses (without
duplication of any payments made to such Requesting Lender by Borrower or
the
Proposed Lender) shall survive for the benefit of such Requesting Lender
under
this Section 2.2.3(d) with respect to the time prior to such
replacement.
(e) If
any requirement of law or any change therein or in the interpretation or
application thereof, shall hereafter make it unlawful for Lender to make
or
maintain a LIBOR Loan as contemplated hereunder, (i) the obligation of
Lender hereunder to make a LIBOR Loan shall be cancelled forthwith and
(ii) Lender may give Borrower a Lender’s Notice, establishing the
Applicable Interest Rate at the Substitute Rate plus the Substitute Spread,
in
which case the Applicable Interest Rate shall be a rate equal to the Substitute
Rate in effect from time to time plus the Substitute Spread. In the
event the condition necessitating the cancellation of Lender’s obligation to
make a LIBOR Loan hereunder shall cease, Lender shall promptly notify Borrower
of such cessation and the Loan shall resume its characteristics as a LIBOR
Loan
in accordance with the terms herein from and after the first day of the calendar
month next following such cessation. Borrower hereby agrees promptly
to pay Lender, upon demand, any additional amounts necessary to compensate
Lender for any out-of-pocket costs
33
reasonably
incurred by Lender in making any conversion in accordance with this Agreement,
including, without limitation, any interest or fees payable by Lender to
lenders
of funds obtained by it in order to make or maintain the LIBOR Loan
hereunder. Lender’s notice of such costs, as certified to Borrower,
shall be set forth in reasonable detail and Lender’s calculation shall be
conclusive absent manifest error.
(f) In
the event that any change in any requirement of law or in the interpretation
or
application thereof, or compliance by Lender with any request or directive
(whether or not having the force of law) hereafter issued from any central
bank
or other Governmental Authority:
(i) shall
hereafter have the effect of reducing the rate of return on Lender’s capital as
a consequence of its obligations hereunder to a level below that which Lender
could have achieved but for such adoption, change or compliance (taking into
consideration Lender’s policies with respect to capital adequacy) by any amount
deemed by Lender to be material;
(ii) shall
hereafter impose, modify, increase or hold applicable any reserve, special
deposit, compulsory loan or similar requirement against assets held by, or
deposits or other liabilities in or for the account of, advances or loans
by, or
other credit extended by, or any other acquisition of funds by, any office
of
Lender which is not otherwise included in the determination of the rate
hereunder; or
(iii) shall
hereafter impose on Lender any other condition and the result of any of the
foregoing is to increase the cost to Lender of making, renewing or maintaining
loans or extensions of credit or to reduce any amount receivable
hereunder;
then,
in
any such case, Borrower shall promptly pay Lender, upon demand, any additional
amounts necessary to compensate Lender for such additional cost or reduced
amount receivable which Lender deems to be material as reasonably determined
by
Lender. If Lender becomes entitled to claim any additional amounts
pursuant to this Section 2.2.3(f), Borrower shall not be required to pay
same unless they are the result of requirements imposed generally on lenders
as
foreign banks or trustee in a Securitization similar to Lender and not the
result of some specific reserve or similar requirement imposed on Lender
as a
result of Lender’s special circumstances. If Lender becomes entitled
to claim any additional amounts pursuant to this Section 2.2.3(f),
Lender shall provide Borrower with not less than thirty (30) days written
notice
specifying in reasonable detail the event by reason of which it has become
so
entitled and the additional amounts required to fully compensate Lender for
such
additional costs or reduced amounts. A certificate as to any
additional costs or amounts payable pursuant to the foregoing sentence, executed
by an authorized signatory of Lender and submitted by Lender to Borrower
shall
be conclusive in the absence of manifest error. This provision shall
survive payment of the Notes and the satisfaction of all other obligations
of
Borrower under this Agreement and the Loan Documents.
(g) Borrower
agrees to indemnify Lender and to hold Lender harmless from any loss or expense
(other than consequential and punitive damages) which Lender sustains or
incurs
as a consequence of (i) any default by Borrower in payment of the principal
of or
34
interest
on a LIBOR Loan, including, without limitation, any such loss or expense
arising
from interest or fees payable by Lender to lenders of funds obtained by it
in
order to maintain a LIBOR Loan hereunder, (ii) any prepayment (whether
voluntary or mandatory) of the LIBOR Loan on a day that (A) is not the
Monthly Payment Date immediately following the last day of an Interest Period
with respect thereto or (B) is the Monthly Payment Date immediately
following the last day of an Interest Period with respect thereto if Borrower
did not give the prior written notice of such prepayment required pursuant
to
the terms of this Agreement, including, without limitation, such loss or
expense
arising from interest or fees payable by Lender to lenders of funds obtained
by
it in order to maintain the LIBOR Loan hereunder, (iii) the conversion (for
any reason whatsoever, whether voluntary or involuntary) of the Applicable
Interest Rate to the Substitute Rate plus the Substitute Spread with respect
to
any portion of the outstanding principal amount of the Loan then bearing
interest at a rate other than the Substitute Rate plus the Substitute Spread
on
a date other than the Monthly Payment Date immediately following the last
day of
an Interest Period, including, without limitation, such loss or expenses
arising
from interest or fees payable by Lender to lenders of funds obtained by it
in
order to maintain a LIBOR Loan hereunder or (iv) any failure of Borrower
to
borrower a Future Advance on the date specified in the relevant Advance Request
(the amounts referred to in clauses (i), (ii), (iii) and (iv) are herein
referred to collectively as the “Breakage
Costs”). Without limiting the effect of the preceding
sentence, such compensation shall include an amount equal to the excess,
if any,
of (I) the amount of interest that otherwise would have accrued on the
principal amount not so paid, or so prepaid or converted, or not so borrowed
for
the period from the date of such required payment, prepayment, or conversion
or
failure to borrow to the last day of the then current Interest Period for
such
principal amount (or, in the case of a failure to borrow, the Interest Period
for such Future Advance that would have commenced on the date specified for
such
borrowing) at the applicable rate of interest for such LIBOR Loan or Future
Advance provided for herein over (II) the amount of interest that otherwise
would have accrued on such principal amount at a rate per annum equal to
the
interest component of the amount such Lender would have bid in the London
interbank market for Dollar deposits of leading banks in amounts comparable
to
such principal amount and with maturities comparable to such period (as
reasonably determined by such Lender), or if such Lender shall cease to make
such bids, the equivalent rate, as reasonably determined by such Lender,
derived
from Page 3750 of the Dow Xxxxx Markets (Telerate) Service or other
publicly available source as described in the definition of LIBOR.
(h) The
provisions of this Section 2.2.3 shall survive payment of the Notes in
full and the satisfaction of all other obligations of Borrower under this
Agreement and the other Loan Documents.
2.2.4 Usury
Savings. This Agreement and the other Loan Documents are
subject to the express condition that at no time shall Borrower be required
to
pay interest on the principal balance of the Loan at a rate which could subject
Lender to either civil or criminal liability as a result of being in excess
of
the Maximum Legal Rate. If by the terms of this Agreement or the
other Loan Documents, Borrower is at any time required or obligated to pay
interest on the principal balance due hereunder at a rate in excess of the
Maximum Legal Rate, the Applicable Interest Rate or the Default Rate, as
the
case may be, shall be deemed to be immediately reduced to the Maximum Legal
Rate
and all previous payments in excess of the Maximum Legal Rate shall be deemed
to
have been payments in reduction of principal and not
35
on
account of the interest due hereunder. All sums paid or agreed to be
paid to Lender for the use, forbearance, or detention of the sums due under
the
Loan, shall, to the extent permitted by applicable law, be amortized, prorated,
allocated, and spread throughout the full stated term of the Loan until payment
in full so that the rate or amount of interest on account of the Loan does
not
exceed the Maximum Legal Rate from time to time in effect and applicable
to the
Loan for so long as the Loan is outstanding.
Section
2.3. Loan
Payments.
2.3.1 Payment
Before Maturity Date. Monthly installments of interest
only shall be paid on each Monthly Payment Date commencing on November 9,
2007
and on each subsequent Monthly Payment Date thereafter to the Maturity Date
for
the Interest Period immediately prior to the date on which such Monthly Payment
Date or Maturity Date occurs. Interest on the outstanding principal
amount of the Loan for the period through and including October 8, 2007 shall
be
paid by Borrower on the Closing Date.
2.3.2 Payment
on Maturity Date.
(a) The
outstanding principal balance of the Loan together with all accrued and unpaid
interest thereon (including, without limitation, all interest that would
accrue
on the outstanding principal balance of the Loan through the end of the Interest
Period immediately prior to the date on which the Maturity Date occurs) and
all
other amounts outstanding hereunder and under the Notes, the Mortgage and
the
other Loan Documents shall be due and payable, and Borrower shall pay all
such
sums to Lender, on the Maturity Date.
(b) Borrower
shall not have any option to extend the Maturity Date of the Loan.
2.3.3 Interest
Rate and Payment after Default. In the event that, and
for so long as, any Event of Default shall have occurred and be continuing,
the
outstanding principal balance of the Loan shall accrue interest at the Default
Rate, calculated from the date the Default occurred which led to such an
Event
of Default without regard to any grace or cure periods contained
herein. If all or any part of the principal amount of the Loan is
repaid upon acceleration of the Loan following the occurrence of an Event
of
Default prior to the Permitted Prepayment Date, Borrower shall be required
to
pay to Lender, in addition to all other amounts then payable hereunder, a
prepayment fee equal to one percent (1%) of the amount of principal being
repaid
together with a Spread Maintenance Premium calculated with respect to the
amount
of principal being repaid and Breakage Costs.
2.3.4 Late
Payment Charge. If any principal, interest or any other
sum due under the Loan Documents, other than the payment of principal due
on the
Maturity Date, is not paid by Borrower on the date on which it is due, Borrower
shall pay to Lender upon demand an amount equal to the lesser of (a) five
percent (5%) of such unpaid sum or (b) the maximum amount permitted by
applicable law in order to defray the expense incurred by Lender in handling
and
processing such delinquent payment and to compensate Lender for the loss
of the
use of such delinquent payment. Any such amount shall be secured by
the Mortgage and the other Loan Documents.
36
(a) Except
as otherwise provided herein, all payments and prepayments under this Agreement
and the Notes shall be made to Lender not later than 1:00 P.M., New York
City
time, on the date when due and shall be made in lawful money of the United
States of America in immediately available funds at Lender’s office at 1114
Avenue of the Xxxxxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, or at such
other
place as Lender may from time to time designate in writing, and any funds
received by Lender after such time shall, for all purposes hereof, be deemed
to
have been paid on the next succeeding Business Day.
(b) Whenever
any payment to be made hereunder or under any other Loan Document shall be
stated to be due on a day which is not a Business Day, the due date thereof
shall be the immediately preceding Business Day.
(c) All
payments required to be made by Borrower hereunder or under the Notes or
the
other Loan Documents shall be made irrespective of, and without deduction
for,
any setoff, claim or counterclaim and shall be made irrespective of any defense
thereto.
2.3.6 Change
in Payment Date. Prior to a Securitization, Lender may in its sole
discretion, by notice to Borrower, change the day of the month that will
constitute the Monthly Payment Date, as set forth in the definition of
“Monthly Payment Date.”
Section
2.4. Prepayments.
2.4.1 Voluntary
Prepayments. Except as otherwise provided herein,
Borrower shall not have the right to prepay the Loan in whole or in
part. On and after the Permitted Prepayment Date Borrower may, at its
option and upon at least ten (10) Business Days (or such shorter period as
permitted by Lender in its discretion) prior notice to Lender (which notice
shall be irrevocable) specifying the date on which such prepayment is to
be made
(the “Prepayment Date”), prepay the Debt in whole or not
in part (but if prepayment is made in part, such prepayment shall be in
increments of $1,000,000); provided, however, that no prepayment
shall be permitted on any date during the period commencing on the first
calendar day immediately following a Monthly Payment Date to, but not including,
the Determination Date in such calendar month (the “Lockout
Period”), unless consented to by Lender in its sole
discretion. Borrower shall pay to Lender, simultaneously with such
prepayment:
(a) if
such prepayment is made on a Monthly Payment Date, all accrued and unpaid
interest calculated at the Applicable Interest Rate on the amount of principal
being prepaid through and including the end of the Interest Period immediately
prior to the date on which such prepayment occurs;
(b) if
such prepayment is made on a day other than a Monthly Payment Date (subject
to
the Lockout Period), all accrued and unpaid interest calculated at the
Applicable Interest Rate on the amount of principal being prepaid through
and
including the end of the Interest Period immediately prior to the date on
which
such prepayment occurs; provided, however, that if the Prepayment Date is
a date
on or after the Determination Date in such calendar month and prior to the
first
day of the Interest Period that commences in such calendar month, Borrower
shall
also pay to Lender in connection with such prepayment all interest on the
37
principal
amount being prepaid which would have accrued through the end of the next
succeeding Interest Period (the “Interest
Shortfall”). Any prepayment received by Lender on a date
other than a Monthly Payment Date shall be held by Lender as collateral security
for the Loan and shall be applied to the Debt on the next Monthly Payment
Date;
(c) Breakage
Costs, if any, without duplication of any sums paid pursuant to the preceding
clauses (a) and (b); and
(d) [reserved]
(e) all
other sums then due under this Agreement, the Notes or the other Loan
Documents.
If
a
notice of prepayment is given by Borrower to Lender pursuant to this Section
2.4.1, the amount designated for prepayment and all other sums required
under this Section 2.4.1 shall be due and payable on the Prepayment
Date. If Borrower prepays the Loan in full, the obligation of the
Note B-2 Lender to make any Future Advance shall be of no further force or
effect. Notwithstanding the foregoing, (x) Borrower shall have the
right (in each case by notice to the Lender not later than five (5) Business
Days prior to the scheduled date of prepayment) to postpone the date of
prepayment specified in its prepayment notice on one or more occasions for
an
aggregate of up to ninety (90) days for all postponements, and (b) no more
than
two (2) times during the term of the Loan, Borrower shall have the right
(in
each case by notice to the Lender not later than five (5) Business Days prior
to
the scheduled date of prepayment) to revoke its notice of its
intention to prepay.
2.4.2 Mandatory
Prepayments. On the next occurring Monthly Payment Date
following the date on which Borrower actually receives any Net Proceeds,
if and
to the extent Lender is not obligated to make such Net Proceeds available
to
Borrower for the Restoration of the Property, Borrower shall prepay the
outstanding principal balance of the Notes in an amount equal to one hundred
percent (100%) of such Net Proceeds. Such prepayment shall be
applied, first, to interest on the outstanding principal balance of the Loan
that would have accrued at the Applicable Interest Rate on the amount prepaid
through the end of the Interest Period immediately prior to the date on which
such prepayment occurs, and then to all other amounts then due to Lender
under
this Agreement or any of the other Loan Documents and then to the outstanding
principal balance of the Loan. Any partial prepayment shall be
applied first to any balloon payment due at maturity, and then to installments
of principal in the inverse order of their maturity. No Spread
Maintenance Premium shall be payable under this Section
2.4.2.
2.4.3 Prepayments
After Default. If after an Event of Default, but prior
to the date when prepayment is permitted under Section 2.4.1, payment of
all or any part of the principal of the Loan is tendered by Borrower (which
tender Lender may reject to the extent permitted under applicable Legal
Requirements), a purchaser at foreclosure or any other Person, such tender
shall
be deemed an attempt to circumvent the prohibition against prepayment set
forth
in Section 2.4.1 and Borrower, such purchaser at foreclosure or
other Person shall pay the Spread Maintenance Premium, in addition to (i)
all
accrued and unpaid interest calculated at the Applicable Interest Rate on
the
amount of principal being prepaid through and including the Prepayment Date
together with an amount equal to the interest that would have accrued at
the
38
Applicable
Interest Rate on the amount of principal being prepaid through the end of
the
Interest Period immediately prior to the date on which such prepayment occurs,
(ii) the Interest Shortfall, if applicable, with respect to the amount prepaid,
(iii) Breakage Costs, if any, without duplication of any sums paid pursuant
to the preceding clause (ii); and (v) all other sums due under this
Agreement (including Section 2.3.3), the Notes or the other Loan
Documents in connection with a partial or total prepayment.
2.4.4 If
the Loan is prepaid in full at any time prior to the funding of the full
amount
of the TI/LC Maximum Advance Amount and Maximum Xxxxxx & Xxxxxxx Imputed
Rent Advance Amount, then the Note B Lenders’ obligations to fund any unfunded
portion of the TI/LC Maximum Advance Amount and Maximum Xxxxxx & Xxxxxxx
Imputed Rent Advance shall thereupon be null and void and of no further force
or
effect.
Section
2.5. Interest
Rate Swap. At all times during the term of the Loan, the
Affiliated Hedge Party shall maintain in effect an Interest Rate Protection
Agreement, with a notional amount equal to not less than the Facility Amount
and
with Bank of America N.A. (so long as it maintains a Minimum Counterparty
Rating) or another Counterparty acceptable to Lender having a Minimum
Counterparty Rating. If the Affiliated Hedge Party obtains one (1)
Interest Rate Protection Agreement, the LIBOR strike rate under the Interest
Rate Protection Agreement shall be equal to or less than the Capped LIBOR
Rate,
or if the Affiliated Hedge Party obtains more than one (1) Interest Rate
Protection Agreement, the blended LIBOR strike rate under the Interest Rate
Protection Agreement, as determined by Lender, shall be equal to or less
than
the Capped LIBOR Rate. The Interest Rate Protection Agreement shall
be in form and substance reasonably satisfactory to Lender. In the
event of any downgrade or withdrawal of the rating of such Counterparty by
any
Rating Agency below the Minimum Counterparty Rating, Borrower shall cause
the
Affiliated Hedge Party to replace the Interest Rate Protection Agreement
not
later than thirty (30) Business Days following receipt of notice from Lender
of
such downgrade or withdrawal with an Interest Rate Protection Agreement in
form
and substance reasonably satisfactory to Lender (and meeting the requirements
set forth in this Section 2.5) from a Counterparty acceptable to Lender
having a Minimum Counterparty Rating; provided, however, that if
Eurohypo AG is the Counterparty and any Rating Agency withdraws or downgrades
the credit rating of Lender below the Minimum Counterparty Rating, Borrower
shall not be required to cause the Affiliated Hedge Party to replace the
Counterparty under the Interest Rate Protection Agreement provided that within
thirty (30) Business Days following Lender’s notice to Borrower of such
downgrade or withdrawal Eurohypo AG posts additional collateral acceptable
to
the Rating Agencies securing its obligations under the Interest Rate Protection
Agreement. Notwithstanding the foregoing, if S&P or Fitch
withdraws or downgrades the credit rating of Eurohypo AG below “A”, or Xxxxx’x
withdraws or downgrades the credit rating of Eurohypo AG below “Aa3”, Borrower
shall cause the Affiliated Hedge Party to replace the Interest Rate Protection
Agreement not later than fifteen (15) Business Days following receipt of
notice
from Lender of such downgrade or withdrawal with an Interest Rate Protection
Agreement in form and substance satisfactory to Lender (and meeting the
requirements set forth in this Section 2.5) from a Counterparty acceptable
to
Lender having a Minimum Counterparty Rating.
Section
2.6. Guarantee
Rights. Guarantor or its Affiliates shall have the right
to provide Lender with a guaranty, in the sole discretion of Guarantor or
such
Affiliate, of all or any
39
portion
of any of the Notes, and Lender agrees, provided that such guaranty does
not
adversely affect any of Lender’s rights and interests under the Loan Documents
or violate any applicable Legal Requirements and the conditions set forth
below
are satisfied, to accept such guaranty. Lender may condition its
acceptance of such guaranty upon delivery to Lender of a satisfactory
non-consolidation opinion (which opinion shall be in form, scope and substance
acceptable in all respects to Lender and the Rating Agencies) and modification
of the Loan Documents to reflect the existence and terms of such
guaranty. All expenses incurred by Lender in connection with its
review of a proposed guaranty and the satisfaction of the conditions set
forth
above (including, without limitation, legal fees and expenses in connection
therewith) shall be jointly and severally payable by Borrower and Guarantor
whether or not Lender accepts the proposed guaranty.
|
|
III.
|
REPRESENTATIONS
AND WARRANTIES
|
Section
3.1. Borrower
Representations.
Borrower
represents and warrants as of the Closing Date (without limiting the
effectiveness of Borrower’s representations and warranties in accordance with
Section 3.1.24 or any Advance Request) that:
3.1.1 Organization.
(a) Each
of Borrower and each SPC Party is duly organized, validly existing and in
good
standing with full power and authority to own its assets and conduct its
business, and is duly qualified in all jurisdictions in which the ownership
or
lease of its property or the conduct of its business requires such
qualification, except where the failure to be so qualified would not have
a
Material Adverse Effect on its ability to perform its obligations hereunder,
and
Borrower has taken all necessary action to authorize the execution, delivery
and
performance of this Agreement and the other Loan Documents by it, and has
the
power and authority to execute, deliver and perform under this Agreement,
the
other Loan Documents and all the transactions contemplated hereby.
(b) Borrower’s
exact legal name is correctly set forth in the first paragraph of this
Agreement. Borrower is an organization of the type specified in the
first paragraph of this Agreement. Borrower is incorporated or
organized under the laws of the state specified in the first paragraph of
this
Agreement. Borrower’s principal place of business and chief executive
office, and the place where Borrower keeps its books and records, including
recorded data of any kind or nature, regardless of the medium of recording,
including software, writings, plans, specifications and schematics, has been
for
the preceding four (4) months (or, if less than four (4) months, the entire
period of the existence of Borrower) and will continue to be the address
of
Borrower set forth in the first paragraph of this Agreement (unless Borrower
notifies Lender in writing at least thirty (30) days prior to the date of
such
change). Borrower’s organizational identification number, if any,
assigned by the state of its incorporation or organization is
4400680. Borrower’s federal tax identification number is
00-0000000.
3.1.2 Proceedings. This
Agreement and the other Loan Documents have been duly authorized, executed
and
delivered by Borrower and constitute a legal, valid and binding obligation
of
Borrower, enforceable against Borrower in accordance with their respective
terms,
40
except
as
such enforcement may be limited by bankruptcy, insolvency, reorganization,
moratorium or other similar laws affecting the enforcement of creditors’ rights
generally, and by general principles of equity (regardless of whether such
enforceability is considered in a proceeding in equity or at law).
3.1.3 No
Conflicts. The execution and delivery of this Agreement
and the other Loan Documents by Borrower and the performance of its obligations
hereunder and thereunder will not conflict with any provision of any law
or
regulation to which Borrower is subject, or conflict with, result in a breach
of, or constitute a default under, any of the terms, conditions or provisions
of
any of Borrower’s organizational documents or any agreement or instrument to
which Borrower is a party or by which it is bound, or any order or decree
applicable to Borrower, or result in the creation or imposition of any lien
on
any of Borrower’s assets or property (other than pursuant to the Loan
Documents).
3.1.4 Litigation. There
is no action, suit, proceeding or investigation pending or, to Borrower’s
knowledge, threatened against Borrower in any court or by or before any other
Governmental Authority that would have a Material Adverse
Effect. Borrower is not in default with respect to any order or
decree of any court or any order, regulation or demand of any Governmental
Authority, which default might have a Material Adverse Effect.
3.1.5 Agreements. Borrower
is not a party to any agreement or instrument or subject to any restriction
which would have a Material Adverse Effect. Borrower is not in
default in any material respect in the performance, observance or fulfillment
of
any of the obligations, covenants or conditions contained in any agreement
or
instrument to which it is a party or by which Borrower or the Property is
bound. Borrower has no material financial obligation under any
agreement or instrument to which Borrower is a party or by which Borrower
or the
Property is otherwise bound, other than (a) obligations incurred in the ordinary
course of the operation of the Property and (b) obligations under the Loan
Documents.
3.1.6 Consents. No
consent, approval, authorization or order of any court or Governmental Authority
is required for the execution, delivery and performance by Borrower of, or
compliance by Borrower with, this Agreement or the consummation of the
transactions contemplated hereby, other than those which have been obtained
by
Borrower.
3.1.7 Title. Borrower
has good, marketable and insurable fee simple title to the real property
comprising part of the Property and good title to the balance of the Property
owned by it, free and clear of all Liens whatsoever except the Permitted
Encumbrances and such other Liens expressly permitted by this Agreement and
the
Loan Documents. The Mortgage, when properly recorded in the appropriate records,
together with any Uniform Commercial Code financing statements required to
be
filed in connection therewith, will create (a) a valid, first priority,
perfected lien on the Property, subject only to Permitted Encumbrances described
in clause (ii) of the definition of “Permitted
Encumbrances” and (b) perfected security interests in and to,
and perfected collateral assignments of, all personalty (including the Leases),
all in accordance with the terms thereof, in each case subject only to any
Permitted Encumbrances. There are no mechanics’, materialman’s or
other similar liens or claims which have been filed for work, labor or materials
affecting the Property which are or may be liens prior to, or equal or
coordinate with, the lien of the Mortgage. None of the Permitted
Encumbrances, individually or
41
in
the
aggregate, materially interfere with the benefits of the security intended
to be
provided by the Mortgage and this Loan Agreement, materially and adversely
affect the value of the Property, impair the use or operations of the Property
or impair Borrower’s ability to pay the Debt in a timely manner.
3.1.8 No
Plan Assets. As of the date hereof and throughout the
term of the Loan (a) Borrower is not and will not be an “employee benefit
plan,” as defined in Section 3(3) of ERISA, subject to Title I of ERISA,
(b) none of the assets of Borrower constitutes or will constitute “plan
assets” of one or more such plans within the meaning of 29 C.F.R.
Section 2510.3-101, (c) Borrower is not and will not be a
“governmental plan” within the meaning of Section 3(32) of ERISA, and
(d) transactions by or with Borrower are not and will not be subject to any
state statute regulating investments of, or fiduciary obligations with respect
to, governmental plans.
3.1.9 Compliance. Except
as disclosed in the Property Condition Report or the Environmental Report,
to
the best of Borrower’s knowledge after due inquiry, Borrower and the Property
and the use thereof comply in all material respects with all applicable Legal
Requirements, including, without limitation, building and zoning ordinances
and
codes, except to the extent such non-compliance, individually or in the
aggregate, would not reasonably be expected to have a Material Adverse
Effect. Borrower has not received notice of, and, Borrower is not
otherwise aware of any default or violation of any order, writ, injunction,
decree or demand of any Governmental Authority, the violation of which would
have a Material Adverse Effect. To Borrower’s knowledge, there has
not been, and Borrower covenants that there shall never be committed by Borrower
or any other person in occupancy of or involved with the operation or use
of the
Property, any act or omission affording the federal government or any state
or
local government the right of forfeiture as against the Property or any part
thereof or any monies paid in performance of Borrower’s obligations under any of
the Loan Documents. Borrower hereby covenants and agrees not to
commit, or knowingly permit or suffer to exist any act or omission affording
such right of forfeiture.
3.1.10 Financial
Information. All financial data, including, without
limitation, the statements of cash flow and income and operating expense,
that
have been delivered to Lender in respect of the Property (i) are true,
complete and correct in all material respects, (ii) accurately represent
the financial condition of the Property as of the date of such reports, and
(iii) have been prepared in accordance with GAAP throughout the periods
covered, except as disclosed therein. Borrower does not have any
contingent liabilities, liabilities for taxes, unusual forward or long-term
commitments or unrealized or anticipated losses from any unfavorable commitments
that are known to Borrower and reasonably likely to have a Material Adverse
Effect. Since the date of the most current financial statements
delivered by Borrower to Lender, there has been no material adverse change
in
the financial condition, operations or business of Borrower or the Property
from
that set forth in said financial statements.
3.1.11 Condemnation. No
Condemnation or other proceeding has been commenced or, to Borrower’s best
knowledge, is contemplated with respect to all or any portion of the Property
or
for the relocation of roadways providing access to the Property.
42
3.1.12 Utilities
and Public Access. The Property has rights of access to
public ways and is served by water, sewer, sanitary sewer and storm drain
facilities adequate to service the Property for its intended uses.
3.1.13 Separate
Lots. The Property is comprised of one (1) or more
parcels which constitute separate tax lots and do not constitute a portion
of
any other tax lot not a part of the Property.
3.1.14 Assessments. There
are no pending or proposed special or other assessments for public improvements
or otherwise affecting the Property, nor are there any contemplated improvements
to the Property that may result in such special or other
assessments.
3.1.15 No
Defenses. The Loan Documents are not subject to any
right of rescission, set-off, counterclaim or defense by Borrower, including
the
defense of usury, nor would the operation of any of the terms of the Loan
Documents, or the exercise of any right thereunder, render the Loan Documents
unenforceable (subject to principles of equity and bankruptcy, insolvency
and
other laws generally affecting creditors’ rights and the enforcement of debtors
obligations), and Borrower has not asserted any right of rescission, set-off,
counterclaim or defense with respect thereto.
3.1.16 Assignment
of Leases. The Assignment of Leases creates a valid
assignment of, or a valid security interest in, certain rights under the
Leases,
subject only to a license granted to Borrower to exercise certain rights
and to
perform certain obligations of the lessor under the Leases, as more particularly
set forth therein. No Person other than Lender or a Tenant under a
Lease has any interest in or assignment of the Leases or any portion of the
Rents due and payable or to become due and payable thereunder which are
presently outstanding.
3.1.17 Insurance. Borrower
has obtained and has delivered to Lender or shall obtain and deliver to Lender
pursuant to Section 5.1.1(b) original or certified copies of all of the
Policies, reflecting the insurance coverages, amounts and other requirements
set
forth in this Agreement, together with certificates of insurance with respect
to
such Policies approved by Lender. All premiums due under such
Policies as of the Closing Date have been paid. No claims have been
made under any of the Policies with respect to the Property or Borrower that
are
presently outstanding, and no Person, including Borrower, has done, by act
or
omission, anything which would impair the coverage of any of the Policies
relating to the Property or the Borrower.
3.1.18 Licenses. All
permits and approvals, including, without limitation, certificates of occupancy
required by any Governmental Authority for the use, occupancy and operation
of
the Property in the manner in which the Property is currently being used,
occupied and operated have been obtained and are in full force and
effect.
3.1.19 Flood
Zone. None of the Improvements on the Property is
located in an area identified by the Federal Emergency Management Agency
as a
special flood hazard area.
3.1.20 Physical
Condition. Except as disclosed in the Property Condition
Report or the Environmental Report, to Borrower’s knowledge, the Property,
including, without limitation, all buildings, improvements, parking facilities,
sidewalks, storm drainage systems,
43
roofs,
plumbing systems, HVAC systems, fire protection systems, electrical systems,
equipment, elevators, exterior sidings and doors, landscaping, irrigation
systems and all structural components, are in good condition, order and repair
in all material respects; except as disclosed in the Property Condition Report
or the Environmental Report, to Borrower’s knowledge, there exists no structural
or other material defects or damages in the Property, whether latent or
otherwise, and Borrower has not received notice from any insurance company
or
bonding company of any defects or inadequacies in the Property, or any part
thereof, that have not been corrected and would adversely affect the
insurability of the same or cause the imposition of extraordinary premiums
or
charges thereon or of any termination or threatened termination of any policy
of
insurance or bond.
3.1.21 Boundaries. Except
as disclosed on the Survey, all of the improvements which were included in
determining the appraised value of the Property lie wholly within the boundaries
and building restriction lines of the Property, and no improvements on adjoining
properties encroach upon the Property, and no easements or other encumbrances
affecting the Property encroach upon any of the improvements, so as to affect
the value or marketability of the Property except those which are insured
against by title insurance each of which, whether or not insured are, to
the
best of Borrower’s knowledge after due inquiry, shown on the
Survey.
3.1.22 Leases. Borrower
represents and warrants to Lender with respect to the Leases
that: (a) the rent roll attached hereto as Schedule I is
true, complete and correct in all material respects and the Property is not
subject to any Leases other than the Leases described in Schedule I,
(b) the Leases identified on Schedule I are in full force and effect
and there are no defaults under any Major Leases by either party, (c) there
are
no defaults under any non-Major Leases by either party that, individually
or in
the aggregate, could be reasonably expected to have a Material Adverse Effect,
(d) the copies of the Leases delivered to Lender are true and complete, and
there are no oral agreements with respect thereto, (e) no Rent (including
security deposits) has been paid more than one (1) month in advance of its
due
date (other than security deposits, percentage rents, escalation and estimated
payments of taxes, insurance premiums and operating expenses payable by Tenants
pursuant to the terms and provisions of their respective Leases), (f) all
work
to be performed by Borrower under each Lease has been performed as required
and
has been accepted by the applicable Tenant, (g) any payments, free rent,
partial rent, rebate of rent or other payments, credits, allowances or
abatements required to be given by Borrower to any Tenant has already been
received by such Tenant, (h) all security deposits and each Tenant Letter
of Credit are being held in accordance with applicable Legal Requirements,
(i) neither the landlord nor any Tenant is in default under any of the
Leases; (j) Borrower has no knowledge of any notice of termination or
default with respect to any Lease; (k) Borrower has not assigned or pledged
any of the Leases, the rents, any Tenant Letter of Credit, or any interests
therein except to Lender; (l) no Tenant or other party has an option or
right of first refusal or offer, to purchase all or any portion of the Property;
(m) no Tenant has the right to terminate its Lease prior to expiration of
the stated term of such Lease; (n) all existing Leases are subordinate to
the Mortgage either pursuant to their terms or a recorded subordination
agreement; and (p) as of the Closing Date, the only Tenant Letters of Credit
are
those described in Schedule VIII attached hereto. The term
“Lease” as used in this Section 3.1.22 shall be limited to tenant leases
and does not include subleases, licenses, concession agreements or other
agreements otherwise included in the definition of the term “Lease” contained in
Section 1.1 hereof.
44
3.1.23 Filing
and Recording Taxes. All transfer taxes, deed stamps,
intangible taxes or other amounts in the nature of transfer taxes required
to be
paid under applicable Legal Requirements in connection with the transfer
of the
Property to Borrower have been paid or are being paid simultaneously
herewith. All mortgage, mortgage recording, stamp, intangible or
other similar tax required to be paid under applicable Legal Requirements
in
connection with the execution, delivery, recordation, filing, registration,
perfection or enforcement of any of the Loan Documents, including, without
limitation, the Mortgage, have been paid or are being paid simultaneously
herewith. All taxes and governmental assessments due and owing in
respect of the Property have been paid, or an escrow of funds in an amount
sufficient to cover such payments has been established hereunder.
3.1.24 Single
Purpose. Borrower hereby represents and warrants to, and
covenants with, Lender that as of the date hereof and until such time as
the
Debt shall be paid in full, Borrower has not at any time, does not presently,
and shall not:
(a) own
any asset or property other than (i) the Property and assets related to the
acquisition, ownership, development, leasing, use, management or operation
of
the Property and (ii) incidental personal property necessary for the
acquisition, ownership, development, leasing, use, management or operation
of
the Property;
(b) engage
in any business unrelated to the acquisition, ownership, development, leasing,
use, management or operation of the Property;
(c) except
for the Permitted Encumbrances and other contracts or agreements disclosed
in
writing to Lender, enter into any contract or agreement with any Affiliate
of
Borrower, any constituent party of Borrower or any Affiliate of any constituent
party, except upon terms and conditions that are intrinsically fair and
substantially similar to those that would be available in a comparable
transaction on an arms-length basis with third parties other than any such
party;
(d) incur
any Indebtedness or obligations under operating leases other than (i) the
Debt and all other sums due by Borrower under this Agreement or any other
Loan
Documents, (ii) unsecured trade payables, operating leases with respect to
the Property and operational debt not evidenced by a note and in an aggregate
amount not exceeding one percent (1%) of the original principal amount of
the
Loan at any one time, (iii) Indebtedness incurred in the financing of
equipment and other personal property used on the Property with annual payments
not exceeding $5,000,000 in the aggregate; and (iv) the obligation to make
termination payments or reimburse rent payable by the tenants of the Property
under the agreements entered into with existing or prospective tenants of
the
Property with Lender’s approval; and (v) tenant improvement allowances or
similar concessions to tenants of the Property pursuant to Leases; provided
that
any Indebtedness incurred pursuant to subclauses (ii) and (iii) shall be
(x) paid within sixty (60) days of the date incurred and (y) incurred
in the ordinary course of business and any obligations under operating leases
which shall be paid in accordance with their terms. No Indebtedness
other than the Debt may be secured (subordinate or pari passu) by the
Property;
(e) except
for advances made to or for the benefit of Tenants for tenant improvement
allowances or similar concessions pursuant to the Leases currently existing
at
the
45
Property
on the date hereof as disclosed on Schedule I attached hereto or Leases
entered into after the date hereof in accordance with this Agreement, make
any
loans or advances to any third party (including any Affiliate or constituent
party), and shall not acquire obligations or securities of its
Affiliates;
(f) fail
to remain solvent or fail to pay its debts and liabilities (including, as
applicable, shared personnel and overhead expenses) from its assets as the
same
shall become due to the extent it has adequate funds to do so;
(g) fail
to do all things necessary to observe organizational formalities and preserve
its existence, and Borrower will not, nor will Borrower permit any constituent
party to amend, modify or otherwise change the partnership certificate,
partnership agreement, articles of incorporation and bylaws, operating
agreement, trust or other organizational documents of Borrower or such
constituent party without the prior consent of Lender in any manner that
(i) violates the covenants set forth in this Section 3.1.24, or
(ii) amends, modifies or otherwise changes any provision thereof that by
its terms cannot be modified at any time when the Loan is outstanding or
by its
terms cannot be modified without Lender’s consent;
(h) fail
to maintain all of its books, records, financial statements and bank accounts
separate from those of its Affiliates and any constituent
party. Borrower’s assets will not be listed as or list its assets on
the financial statement of any other Person, provided, however, that Borrower’s
assets may be included in a consolidated financial statement of its Affiliates
provided that (i) appropriate notation shall be made on such consolidated
financial statements to indicate the separateness of Borrower and such
Affiliates and to indicate that Borrower’s assets and credit are not available
to satisfy the debts and other obligations of such Affiliates or any other
Person and (ii) such assets shall be listed on Borrower’s own separate
balance sheet;
(i) fail
to file its own (or consolidated) tax returns (to the extent Borrower is
required to file any such tax returns) and will not file a consolidated federal
income tax return with any other Person, except where Borrower is required
to
file consolidated tax returns by applicable Legal Requirements.
(j) fail
to maintain its books, records, resolutions and agreements as official
records;
(k) fail
to be, or fail to hold itself out to the public as, a legal entity separate
and
distinct from any other entity (including any Affiliate or constituent party
of
Borrower), fail to correct any known misunderstanding regarding its status
as a
separate entity, fail to conduct business in its own name, or fail to maintain
and utilize separate stationery, invoices and checks bearing its own name,
and
Borrower shall not identify itself or any of its Affiliates as a division
or
part of the other;
(l) fail
to use commercially reasonable efforts to maintain adequate capital for the
normal obligations reasonably foreseeable in a business of its size and
character and in light of its contemplated business operations; provided,
however, the foregoing shall not require the members of Borrower to make
any
additional capital contributions to Borrower;
46
(m) to
the fullest extent permitted by law, seek or effect the liquidation,
dissolution, winding up, liquidation, consolidation or merger, in whole or
in
part, of Borrower nor permit any constituent party of Borrower to do any
of the
foregoing;
(n) commingle
the funds and other assets of Borrower with those of any Affiliate or any
constituent party of Borrower or any other Person, and will hold all of its
assets in its own name;
(o) fail
to maintain its assets in such a manner that it will not be costly or difficult
to segregate, ascertain or identify its individual assets from those of any
Affiliate or constituent party of Borrower or any other Person;
(p) guarantee
or become obligated for the debts of any other Person or hold itself out
to be
responsible for or have its credit available to satisfy the debts or obligations
of any other Person;
(i) If
Borrower is a limited partnership or a limited liability company (other than
a
single member limited liability company), fail to cause each general partner
or
managing member (each, an “SPC Party”) to be a
corporation whose sole asset is its interest in Borrower and each such SPC
Party
will at all times comply, and will cause Borrower to comply, with each of
the
representations, warranties, and covenants contained in this Section
3.1.24 as if such representation, warranty or covenant was made directly by
such SPC Party. Upon the withdrawal or the disassociation of an SPC
Party from Borrower, Borrower shall immediately appoint a new SPC Party whose
articles of incorporation are substantially similar to those of such SPC
Party
and deliver a new non-consolidation opinion to the Rating Agency or Rating
Agencies, as applicable, with respect to the new SPC Party and its equity
owners;
(ii) If
Borrower is a single member limited liability company, fail to have at least
two
(2) springing members, one of which, upon the dissolution of such sole member
or
the withdrawal or the disassociation of the sole member from Borrower, shall
immediately become the sole member of Borrower, and the other of which shall
become the sole member of Borrower if the first such springing member no
longer
is available to serve as such sole member.
(q) fail
to cause there to be at least two duly appointed members of the board of
directors who are provided by a nationally recognized company that provides
professional independent directors or manager (each, an “Independent
Director” or “Independent Manager”) of each
SPC Party and Borrower reasonably satisfactory to Lender who shall not have
been
at the time of such individual’s appointment or at any time while serving as a
director of such SPC Party and Borrower, and may not have been at any time
during the preceding five years (i) a stockholder, director (other than as
an Independent Director or Independent Manager), officer, employee, partner,
attorney or counsel of such SPC Party, Borrower or any Affiliate of either
of
them, (ii) a customer, supplier or other Person who derives any of its
purchases or revenues from its activities with such SPC Party, Borrower or
any
Affiliate of either of them (other than its fees and charges for serving
as an
Independent Director or Independent Manager of the SPC Party), (iii) a
Person or other entity controlling or under
47
common
control with any such stockholder, partner, customer, supplier or other Person
prohibited by clause (i) or (ii) above, or (iv) a member of the immediate
family of any such stockholder, director, officer, employee, partner, customer,
supplier or other Person prohibited by clause (i) or (ii) above. (For
purposes of this subclause (o), the term “Affiliate” means any person
controlling, under common control with, or controlled by the person in question;
and the term “control” means the possession, directly or indirectly, of the
power to direct or cause the direction of management, policies or activities
of
a person or entity, whether through ownership of voting securities, by contract
or otherwise.) A natural person who satisfies the foregoing definition other
than subparagraph (ii) shall not be disqualified from serving as an Independent
Director or Independent Manager of the SPC Party if such individual is an
independent director or independent manager provided by a nationally-recognized
company that provides professional independent directors or independent managers
and that also provides other corporate services in the ordinary course of
its
business. A natural person who otherwise satisfies the foregoing
definition except for being the independent director or independent manager
of a
“special purpose entity” affiliated with the borrower that does not own a direct
or indirect equity interest in the borrower or any co-borrower shall not
be
disqualified from serving as an Independent Director or Independent Manager
of
the SPC Party if such individual is at the time of initial appointment, or
at
any time while serving as a Independent Director or Independent Manager of
the
SPC Party, an Independent Director or Independent Manager of a “special purpose
entity” affiliated with the Borrower or the SPC Party (other than any entity
that owns a direct or indirect equity interest in borrower or any co-borrower)
if such individual is an independent director or independent manager provided
by
a nationally-recognized company that provides professional independent directors
or independent managers. For purposes of this paragraph, a “special
purpose entity” is an entity, whose organizational documents contain
restrictions on its activities substantially similar to those set forth in
the
SPC Party’s organizational documents.
(r) cause
or permit the board of directors or managers of any SPC Party or Borrower
to
take any action which, under the terms of any certificate of incorporation,
by-laws or any voting trust agreement with respect to any common stock or
under
any organizational document of Borrower or SPC Party, requires a vote of
the
board of directors or managers of each SPC Party and Borrower unless at the
time
of such action there shall be at least two (2) members of the board of directors
or managers who are each an Independent Director or Independent
Manager.
(s) fail
to conduct its business so that the assumptions made with respect to Borrower
in
the Insolvency Opinion shall be true and correct in all respects. In
connection with the foregoing, Borrower hereby covenants and agrees that
it will
comply with or cause the compliance with, (i) all of the facts and
assumptions (whether regarding the Borrower or any other Person) set forth
in
the Insolvency Opinion, (ii) all the representations, warranties and
covenants in this Section 3.1.24, and (iii) all the organizational
documents of the Borrower and any SPC Party.
(t) permit
any Affiliate or constituent party of Borrower independent access to its
bank
accounts.
(u) fail
to pay the salaries of its own employees (if any) from its own funds to the
extent it has adequate funds to do so and maintain a sufficient number of
employees
48
(if
any)
in light of its contemplated business operations; provided, however, the
foregoing shall not require the members of Borrower to may any additional
contributions to Borrower.
(v) fail
to compensate each of its consultants and agents from its funds for services
provided to it and pay from its own assets all obligations of any kind
incurred.
3.1.25 Tax
Filings. To the extent required by applicable Legal
Requirements, Borrower has filed (or has obtained effective extensions for
filing) all federal, state and local tax returns required to be filed and
have
paid or made adequate provision for the payment of all federal, state and
local
taxes, charges and assessments payable by Borrower. Borrower believes
that its tax returns (if any), taking into account any subsequent amended
tax
returns that may have been filed, properly reflect the income and taxes of
Borrower for the periods covered thereby, subject only to reasonable adjustments
required by the Internal Revenue Service or other applicable tax authority
upon
audit.
3.1.26 Solvency. Borrower
(a) has not entered into the transactions contemplated by this Agreement or
any Loan Document with the actual intent to hinder, delay, or defraud any
creditor and (b) received reasonably equivalent value in exchange for its
obligations under the Loan Documents. Giving effect to the Loan, the
fair saleable value of Borrower’s assets exceeds and will, immediately following
the making of the Loan, exceed Borrower’s total liabilities, including, without
limitation, subordinated, unliquidated, disputed and known contingent
liabilities. The fair saleable value of Borrower’s assets is and
will, immediately following the making of the Loan, be greater than Borrower’s
probable liabilities, including the maximum amount of its contingent liabilities
on its debts as such debts become absolute and matured. Borrower’s
assets do not and, immediately following the making of the Loan will not,
constitute unreasonably small capital to carry out its business as conducted
or
as proposed to be conducted. Borrower does not intend to, and does
not believe that it will, incur Indebtedness and liabilities (including known
contingent liabilities and other commitments) beyond its ability to pay such
Indebtedness and liabilities as they mature (taking into account the timing
and
amounts of cash to be received by Borrower and the amounts to be payable
on or
in respect of obligations of Borrower).
3.1.27 Federal
Reserve Regulations. No part of the proceeds of the Loan
will be used for the purpose of purchasing or acquiring any “margin stock”
within the meaning of Regulation U of the Board of Governors of the Federal
Reserve System or for any other purpose which would be inconsistent with
such
Regulation U or any other Regulations of such Board of Governors, or for
any
purposes prohibited by Legal Requirements or by the terms and conditions
of this
Agreement or the other Loan Documents.
3.1.28 Organizational
Chart. The organizational chart attached as Schedule
III hereto, relating to Borrower and certain Affiliates and other parties,
is true, complete and correct on and as of the date hereof.
3.1.29 Investment
Company Act. Borrower is not (a) an “investment
company” or a company “controlled” by an “investment company,” within the
meaning of the Investment Company Act of 1940, as amended; (b) a “holding
company” or a “subsidiary company” of a “holding company” or an “affiliate” of
either a “holding company” or a “subsidiary company”
49
within
the meaning of the Public Utility Holding Company Act of 1935, as amended;
or
(c) subject to any other federal or state law or regulation which purports
to restrict or regulate its ability to borrow money.
3.1.30 Access/Utilities. Except
as disclosed on the Survey, all public utilities necessary to the continued
use
and enjoyment of the Property as presently used and enjoyed are located either
in the public right-of-way abutting the Property or in recorded appurtenant
easements serving the Property. All roads necessary for the full
utilization of the Property for its current purpose have been completed and
dedicated to public use and accepted by all governmental authorities or are
the
subject of access easements for the benefit of the Property.
3.1.31 No
Bankruptcy Filing. Borrower is not contemplating either
the filing of a petition by it under any state or federal bankruptcy or
insolvency laws or the liquidation of its assets or property, and Borrower
does
not have any knowledge of any Person contemplating the filing of any such
petition against it.
3.1.32 Full
and Accurate Disclosure. To Borrower’s knowledge, no
information pertaining to Borrower, Guarantor, the SPC Party or the Property
contained in this Agreement, the other Loan Documents, or any written statement
furnished by or on behalf of Borrower pursuant to the terms of this Agreement
contains any untrue statement of a material fact or omits to state a material
fact necessary to make the statements contained herein or therein not misleading
in light of the circumstances under which they were made. There is no
fact or circumstance presently known to Borrower pertaining to Borrower,
Guarantor, the SPC Party or the Property which has not been disclosed to
Lender
and which will have a Material Adverse Effect.
3.1.33 Foreign
Person. Borrower is not a “foreign person” within the
meaning of Section 1445(f)(3) of the Code.
3.1.34 No
Change in Facts or Circumstances; Disclosure. To the
best of Borrower’s knowledge, there has been no material adverse change in any
condition, fact, circumstance or event that would make the financial statements,
rent rolls, reports, certificates or other documents submitted in connection
with the Loan inaccurate, incomplete or otherwise misleading in any material
respect or that otherwise materially and adversely affects the business
operations or the financial condition of Borrower or the Property.
3.1.35 Perfection
of Accounts.
(a) The
Cash Management Agreement creates a valid and continuing security interest
(as
defined in the Uniform Commercial Code) in the Accounts (as defined in the
Cash
Management Agreement) in favor of Lender, which security interest is prior
to
all other Liens, and is enforceable as such against creditors of and purchasers
from Borrower. Other than in connection with the Loan Documents,
Borrower has not sold or otherwise conveyed the Accounts;
(b) The
Accounts constitute “deposit accounts” or “securities accounts” within the
meaning of the Uniform Commercial Code, as set forth in the Cash Management
Agreement; and
50
(c) Pursuant
and subject to the terms hereof, Agent has agreed to comply with all
instructions originated by Lender, without further consent by Borrower,
directing disposition of the Accounts and all sums at any time held, deposited
or invested therein, together with any interest or other earnings thereon,
and
all proceeds thereof (including proceeds of sales and other dispositions),
whether accounts, general intangibles, chattel paper, deposit accounts,
instruments, documents or securities; and
(d) The
Accounts are not in the name of any Person other than Borrower, as pledgor,
or
Lender, as pledgee. Borrower has not consented to Agent’s complying
with instructions with respect to the Accounts from any Person other than
Lender, its successors and assigns.
3.1.36 Bank
Holding Company. Borrower is not a “bank holding
company” or a direct or indirect subsidiary of a “bank holding company” as
defined in the Bank Holding Company Act of 1956, as amended, and Regulation
Y
thereunder of the Board of Governors of the Federal Reserve System.
3.1.37 REA. The
REA is in full force and effect and neither Borrower nor, to the best of
Borrower’s knowledge, any other party to the REA, is in default thereunder, and
to the best of Borrower’s knowledge after due inquiry, there are no conditions
which, with the passage of time or the giving of notice, or both, would
constitute a default thereunder. Except as set forth on Schedule
V, the REA has not been modified, amended or supplemented.
3.1.38 Patriot
Act.
(a) None
of Borrower, any of its constituents or Affiliates, and to the best of
Borrower’s knowledge, any of its brokers or other agents acting or benefiting in
any capacity in connection with the Loan is a Prohibited Person.
(b) None
of Borrower, any of its constituents or Affiliates, any of its brokers or
other
agents acting in any capacity in connection with the Loan, (i) has
conducted or will conduct any business or has engaged or will engage in any
transaction or dealing with any Prohibited Person, including making or receiving
any contribution of funds, goods or services to or for the benefit of any
Prohibited Person, (ii) has dealt or will deal in, or otherwise has engaged
or will engage in any transaction relating to, any property or interests
in
property blocked pursuant to the Executive Order; or (iii) has engaged or
will engage in or has conspired or will conspire to engage in any transaction
that evades or avoids, or has the purpose of evading or avoiding, or attempts
to
violate, any of the prohibitions set forth in the Executive Order or the
Patriot
Act.
(c) Borrower
covenants and agrees to deliver to Lender any certification or other evidence
required by Legal Requirements or otherwise reasonably requested from time
to
time by Lender, confirming Borrower’s compliance with this Section
3.1.38.
(d) The
representations in this Section 3.1.38 do not relate to any shareholders
of the REIT, for so long as the REIT is a publicly traded company.
51
3.1.40 No
Other Debt. Borrower has not borrowed or received debt
financing (other than permitted pursuant to this Agreement) that has not
been
heretofore repaid in full.
3.1.41 Management
Agreement. All of the representations and warranties
with respect to the Management Agreement set forth in Article VII of
this Agreement are true and correct in all respects.
3.1.42 No
Other Agreements with North Tower Owner. Other than the
agreements referenced on Schedule IX, there are no other agreements
(written or oral) between North Tower Owner and Borrower (or any Borrower
Affiliate) with respect to the ownership, operation, maintenance of, or the
parties’ respective rights and obligations with respect to, the Xxxxx Fargo
Center, (including, without limitation, any parking areas, common areas,
and any
other joint, common or shared facilities, components or areas of the Xxxxx
Fargo
Center).
3.1.43 Xxxxxx
& Xxxxxxx U.S. Bank Tower Lease
Obligations. Borrower certifies that Schedule VII
reflects the only obligations Borrower has assumed pursuant to the Xxxxxx
&
Xxxxxxx U.S. Bank Tower Lease (including, but not limited to, base rent and
pass-through amounts for common area expenses and taxes).
Section
3.2. Survival
of Representations.
The
representations and warranties set forth in Section 3.1 shall
survive for so long as any amount remains payable to Lender under this Agreement
or any of the other Loan Documents.
|
|
IV.
|
BORROWER
COVENANTS
|
Section
4.1. Borrower
Affirmative Covenants.
Borrower
hereby covenants and agrees with Lender that:
4.1.1 Existence;
Compliance with Legal Requirements. Borrower shall do or
cause to be done all things necessary to preserve, renew and keep in full
force
and effect its existence, rights, licenses, permits and franchises and comply
with all Legal Requirements applicable to it and the Property. After
prior written notice to Lender, Borrower, at its own expense, may contest
by
appropriate legal proceeding promptly initiated and conducted in good faith
and
with due diligence, the validity of any Legal Requirement, the applicability
of
any Legal Requirement to Borrower or the Property or any alleged violation
of
any Legal Requirement, provided that (i) no Default (other than a Default
that
is the subject matter being contested) or Event of Default has occurred and
remains uncured, (ii) such proceeding shall be conducted in accordance with
the
applicable provisions (if any) of any instrument to which Borrower is subject
and shall not constitute a default thereunder (other than the default that
is
being contested in compliance with the provisions of such instrument which
permit contest) and such proceeding shall be conducted in accordance with
all
applicable statutes, laws and ordinances, (iii) neither the Property nor
any
part thereof or interest therein will be in danger of being sold, forfeited,
terminated, cancelled or lost, (iv) Borrower shall promptly upon final
52
determination
thereof comply with any such Legal Requirement determined to be valid or
applicable or cure any violation of any Legal Requirement, (v) such proceeding
shall suspend the enforcement of the contested Legal Requirement against
Borrower and the Property, and (vi) Borrower shall furnish such security
as may
be required in the proceeding, or as may be requested by Lender, to insure
compliance with such Legal Requirement, together with all interest and penalties
payable in connection therewith. Lender may apply any such security,
as necessary to cause compliance with such Legal Requirement at any time
when,
in the reasonable judgment of Lender, the validity, applicability or violation
of such Legal Requirement is finally established or the Property (or any
part
thereof or interest therein) shall be in danger of being sold, forfeited,
terminated, cancelled or lost.
4.1.2 Taxes
and Other Charges. Borrower shall pay all Taxes and
Other Charges now or hereafter levied or assessed or imposed against the
Property or any part thereof as the same become due and payable, subject
to
Section 6.2 hereof. Borrower shall furnish to Lender receipts
for the payment of the Taxes and the Other Charges prior to the date the
same
shall become delinquent; provided, however, that Borrower is not required
to
furnish such receipts for payment of Taxes in the event that such Taxes have
been paid by Lender pursuant to Section 6.2 hereof. Borrower
shall not permit or suffer and, subject to Sections 4.1.1 and
4.2.1 hereof, shall promptly discharge any lien or charge against
the
Property. After prior notice to Lender, Borrower, at its own expense,
may contest by appropriate legal proceeding, conducted in good faith and
with
due diligence, the amount or validity of any Taxes or Other Charges, provided
that (a) no Default (other than a Default that is the subject matter being
contested) or Event of Default has occurred and remains uncured; (b) such
proceeding shall be permitted under and be conducted in accordance with all
applicable statutes, laws and ordinances; (c) neither the Property nor any
part thereof or interest therein will be in danger of being sold, forfeited,
terminated, canceled or lost; (d) Borrower shall promptly upon final
determination thereof pay the amount of any such Taxes or Other Charges,
together with all costs, interest and penalties which may be payable in
connection therewith; (e) such proceeding shall suspend the collection of
such contested Taxes or Other Charges from the Property; (f) Borrower shall
furnish such security as may be required by the proceeding in order to suspend
Borrower’s obligations to pay such Taxes or Other Charges or, if no such
requirement is specified, deposit with Lender cash, or other security as
may be
approved by Lender, in an amount equal to one hundred twenty-five percent
(125%)
of the contested amount, to insure the payment of any such Taxes or Other
Charges, together with all interest and penalties thereon; and (g) such contest
by Borrower is not in violation of Leases or Operating
Agreements. Lender may pay over any such cash or other security held
by Lender to the claimant entitled thereto at any time when, in the judgment
of
Lender, the entitlement of such claimant is established.
4.1.3 Litigation. Borrower
shall give prompt notice to Lender of any litigation or governmental proceedings
pending or threatened against Borrower which if adversely determined would
have
a Material Adverse Effect.
4.1.4 Access
to Property. Borrower shall permit agents,
representatives and employees of Lender to inspect the Property or any part
thereof at reasonable hours upon reasonable advance notice, and subject to
the
rights of Tenants under their Leases entered into in accordance with the
Loan
Documents.
53
4.1.6 Financial
Reporting.
(a) GAAP. Borrower
shall keep and maintain or shall cause to be kept and maintained, in accordance
with GAAP, proper and accurate books, records and accounts reflecting all
of the
financial affairs of Borrower and all items of income and expense in connection
with the operation on an individual basis of the Property. All
financial statements delivered to Lender in accordance with this Section
4.1.6 shall be prepared in accordance with GAAP in the United States of
America as in effect on the date so indicated and consistently applied (or
such
other accounting basis reasonably acceptable for Lender).
(b) Monthly
Reports. Prior to a Securitization, within thirty (30) days after
the end of each calendar month, if requested by Lender in writing, Borrower,
shall furnish to Lender a current (as of the calendar month just ended) balance
sheet, a detailed operating statement (showing monthly activity and
year-to-date) stating Gross Income from Operations, Operating Expenses,
Historical Net Operating Income, and Calculated Debt Service for the month
ended, a general ledger, a rent roll for the subject month and, as requested
by
Lender, a written statement setting forth any variance from the Annual Budget,
and any other documentation supporting the information disclosed in the most
recent financial statements. In addition, such statement shall also
be accompanied by (i) a calculation reflecting the Debt Service Coverage
Ratio
for the trailing twelve (12) month period ending with the last day of such
month
and (ii) a certificate of the chief financial officer of Borrower or the
general
partner of Borrower stating that the representations and warranties of Borrower
set forth in Section 3.1.24 are true and correct as of the date of such
certificate and that there are no trade payables outstanding for more than
sixty
(60) days.
(c) Quarterly
Reports. Within forty-five (45) days after the end of each
calendar quarter, Borrower shall furnish to Lender quarterly financial
statements (including a balance sheet, income statement and cash flow statement)
for Borrower and Guarantor prepared in accordance with GAAP (and including
all
appropriate and customary notes), and certificates executed by the chief
financial officer of Borrower or REIT and Guarantor stating that (i) each
such
quarterly statement presents fairly the financial condition and the results
of
operations of Borrower and the Property in the case of Borrower, and the
financial condition of Guarantor, in the case of Guarantor, and has been
prepared in accordance with general accepted accounting principles (ii) that,
as
of the date of such statement, Guarantor is in compliance with the financial
covenants set forth in Section 3.04 of each Guarantee, as applicable, and
containing calculations in such reasonable detail as is acceptable to Lender
in
respect thereof, and (iii) containing a calculation in such reasonable
detail as is acceptable to Lender setting forth the Gross Income from
Operations, Operating Expenses, Historical Net Operating Income, Calculated
Debt
Service, and Debt Service Coverage Ratio for the trailing twelve (12) month
period ending with the last day of the most recent calendar
quarter. Such financial reports shall include a balance sheet for
such quarter, a rent roll and a detailed operating statement (showing quarterly
activity and year-to-date) stating Gross Income from Operations, Operating
Expenses, Net Cash Flow, and net cash flow and capital expenditures for the
calendar quarter just ended.
54
(i) a
complete copy of the annual financial statement for the REIT audited by a
“big
four” accounting firm or other independent certified public accountant
acceptable to Lender in accordance with GAAP for such calendar
year. The annual financial statement described in this clause (i)
shall be accompanied by a certificate executed by the chief financial officer
of
the REIT stating that such annual financial statement presents fairly the
financial condition and the results of operations of REIT and has been prepared
in accordance with generally accepted accounting principles, and an unqualified
opinion of a “big four” accounting firm or other independent certified public
accountant reasonably acceptable to Lender; and
(ii) a
separate (unaudited) schedule showing (A) a balance sheet for Borrower and
(B) a detailed operating statement stating Gross Income from Operations,
Operating Expenses, Historical Net Operating Income, Calculated Debt Service
and
Debt Service Coverage Ratio for such calendar year. The separate
schedule described in this clause (ii) shall be accompanied by (I) a
comparison of the income and expenses of the Property to the budgeted income
and
expenses for the Property for such year and the actual income and expenses
for
the prior calendar year, (II) a certificate executed by the chief financial
officer of Borrower or the REIT stating that each such separate schedule
to the
annual financial statement presents fairly the financial condition and the
results of operations of Borrower and the Property and has been prepared
in
accordance with general accepted accounting principles.
By
such
date, Guarantor shall also deliver to Lender the financial reports required
pursuant to Section 3.02 of the Guarantee. With respect to the annual
financial statements of the REIT that Borrower is required to deliver in
accordance with clause (i) above, if the REIT files its annual 10-K
filings with the Securities and Exchange Commission within the dates on which
the REIT’s annual financial statements are required to be delivered pursuant to
clause (i) of this Section 4.1.6(d), and if such filings include
audited annual financial statements for the REIT and certificates of the
REIT’s
chief financial officer to the effect set forth in clause (i) of this Section
4.1.6(d), then Lender shall accept, in lieu of the delivery of the financial
statements of the REIT in accordance with this Section, the posting of such
annual 10-K filings on the website for the REIT,
xxx.xxxxxxxxxxxxxxxxx.xxx, on the dates on which such filings are made
with the Securities and Exchange Commission, it being understood that the
Lender
shall be entitled to rely on the financial statements included in such filings
and on the certifications with respect thereto set forth therein, to the
same
degree that it would have been entitled to rely thereon had the financial
statements and certifications with respect thereto contained therein been
delivered to Lender in accordance with clause (i) of this Section
4.1.6(d).
(e) Certification;
Supporting Documentation. Each such financial statement shall be
in scope and detail satisfactory to Lender and certified by the chief financial
representative of Borrower.
55
(i) copies
of any final engineering or environmental reports prepared for Borrower with
respect to the Property;
(ii) a
copy of any notice received by Borrower from any environmental authority
having
jurisdiction over the Property with respect to a condition existing or alleged
to exist or emanate from or at the Property;
(iii) with
respect to retail tenants, a summary report containing each of the following
with respect to the Property for the most recently completed calendar
year: (A) aggregate sales by Tenants under Leases or other
occupants of the Property (actual (or to the extent such information is not
provided by Tenants, Manager’s or Borrower’s best estimate) and on a comparable
store basis), (B) rent per square foot payable by each tenant and
(C) aggregate occupancy of the Property by anchor space and in-line store
space as of December 31; and
(iv) if
requested by Lender, a summary report listing only Tenants and square footage
occupied by such Tenants.
(g) Access. Lender
shall have the right from time to time at all times during normal business
hours
to examine such books, records and accounts at the office of Borrower or
other
Person maintaining such books, records and accounts and to make such copies
or
extracts thereof as Lender shall desire. After the occurrence of an
Event of Default, Borrower shall pay any costs and expenses incurred by Lender
to examine Borrower’s records with respect to the Property, as Lender shall
determine to be necessary or appropriate in the protection of Lender’s
interest.
(h) Format
of Delivery. Any reports, statements or other information
required to be delivered under this Agreement shall be delivered (i) in
paper form, (ii) on a diskette, and (iii) if requested by Lender and
within the capabilities of Borrower’s data systems without change or
modification thereto, in electronic form reasonably acceptable to
Lender.
(i) Annual
Budget. Prior to the Closing Date, and annually thereafter not
later than thirty (30) days prior to the commencement of the calendar year,
Borrower shall submit to the Lender for the Lender’s written approval an annual
budget setting forth Borrower’s good faith estimate of Gross Income from
Operations, Operating Expenses, and Capital Expenditures for the applicable
Fiscal Year. Lender shall have the right to approve such budget (such
approval to be in the Lender’s sole and absolute discretion during any period
where Lender is taking action to remove the Manager, and otherwise to be
in
Lender’s reasonable discretion). If Lender objects to the proposed
budget, Lender shall advise Borrower of such objections within fifteen (15)
days after receipt thereof (and deliver to Borrower a reasonably detailed
description of such objections) and Borrower shall within ten (10) days
after receipt of notice of any such objections revise such budget and resubmit
the same to Lender, with such procedure to be repeated until such time as
Lender
shall approve such budget. Each such budget approved by
56
Lender
in
accordance with terms hereof, as well as the budget for the current calendar
year approved by Lender on the Closing Date, shall hereinafter be referred
to as
an “Annual Budget.” Until such time that
Lender has approved a proposed Annual Budget, the most recently approved
Annual
Budget shall apply, provided that such Annual Budget shall be adjusted to
reflect actual increases in real estate taxes, insurance premiums and utilities
expenses and shall otherwise be adjusted to reflect any change during the
preceding year in the Consumer Price Index. Borrower may at any time
propose an amendment to an Annual Budget for the remainder of the then current
calendar year, and, when approved as provided below, such amended Annual
Budget
shall be deemed to be and shall be effective as the Annual Budget for such
calendar year. Prior to making any expenditures not reflected in the
then current Annual Budget in excess of an aggregate amount of five percent
(5%)
of the Annual Budget per annum, Borrower shall propose an amendment to the
Annual Budget to Lender for its reasonable approval. Copies of any
such proposed amended Annual Budget shall be furnished at least thirty (30)
days before final adoption thereof to Lender for its approval. Lender
shall have thirty (30) days after receipt of any proposed amendment to the
Annual Budget to approve or disapprove such proposed
amendment. Borrower’s request for approval of the proposed amendment
to the Annual Budget shall be deemed approved if (i) Lender shall have failed
to
notify Borrower of its approval or disapproval within such thirty (30) day
period following Lender’s receipt of Borrower’s written request together with
any and all information and documentation relating thereto reasonably requested
by Lender to reach a decision and provided the request to Lender is marked
in
bold lettering with the following: “LENDER’S RESPONSE IS REQUIRED WITHIN THIRTY
(30) DAYS OF RECEIPT OF THIS NOTICE PURSUANT TO THE TERMS OF THE LOAN AGREEMENT
BETWEEN THE UNDERSIGNED AND LENDER” and the envelope containing the request must
be marked “PRIORITY”, (ii) Borrower shall have delivered to Lender a written
notice of Lender’s failure to respond to Borrower’s request on or after the end
of such 30-day period, and (iii) Lender shall have failed to notify Borrower
of
its approval or disapproval within ten (10) days following Lender’s receipt of
the notice described in clause (ii). Notwithstanding the foregoing,
Borrower shall be permitted to expend an amount up to $500,000 per annum
to make
emergency repairs to the Property or otherwise to respond to an emergency
affecting the Property.
(j) Other
Required Information. Borrower shall furnish to Lender, within
five (5) Business Days after request (or as soon thereafter as may be reasonably
possible), such further detailed information with respect to the operation
of
the Property and the financial affairs of Borrower as may be reasonably
requested by Lender, including, without limitation, a comparison of the budgeted
income and expenses and the actual income and expenses for the quarter and
year
to date for the Property, together with a detailed explanation of any variances
of more than five percent (5%) between budgeted and actual amounts for such
period and year to date.
4.1.7 Title
to the Property. Borrower will warrant and defend the
validity and priority of the Liens of the Mortgage and the Assignment of
Leases
on the Property against the claims of all Persons whomsoever, subject only
to
Permitted Encumbrances.
4.1.8 Estoppel
Statement.
57
(a) After
request by Lender, Borrower shall within five (5) Business Days furnish Lender
with a statement, duly acknowledged and certified, stating (i) the unpaid
principal amount of the Notes, (ii) the Applicable Interest Rate of the
Notes, (iii) the date installments of interest and/or principal were last
paid, (iv) any offsets or defenses to the payment of the Debt, if any, and
(v) that this Agreement and the other Loan Documents have not been modified
or if modified, giving particulars of such modification.
(b) Borrower
shall use commercially reasonable efforts deliver to Lender, within thirty
(30)
days after request, an estoppel certificate from each Tenant under any Lease
(provided that Borrower shall only be required to use commercially reasonable
efforts to obtain an estoppel certificate from any Tenant not required to
provide an estoppel certificate under its Lease); provided that such certificate
may be in the form required under such Lease; provided further that Borrower
shall not be required to deliver such certificates more frequently than two
(2)
times in any calendar year.
(c) Borrower
shall use commercially reasonable efforts deliver to Lender, upon request,
estoppel certificates from each party under the REA; provided that such
certificates may be in the form required under the REA.
(d) Borrower
shall use commercially reasonable efforts to deliver to Lender, within thirty
(30) days after the Closing Date an estoppel certificate and subordination,
non-disturbance and attornment agreement duly executed and delivered by The
Boston Consulting Group and (where required) Borrower, in each case in form
and
substance reasonably satisfactory to Lender (and if applicable in the form
required under the lease with The Boston Consulting Group).
4.1.9 Leases.
(a) All
Leases and other rental arrangements shall in all respects be approved by
Lender
and shall be on a standard Lease form previously approved by Lender with
no
material modifications (except as approved by Lender). Such Lease
form shall provide that (i) the Lease is subordinate to the Mortgage,
(ii) the tenant shall attorn to Lender, provided Lender has agreed not to
disturb tenant’s occupancy of its lease, and (iii) that any cancellation,
surrender, or amendment of such Lease without the prior written consent of
Lender shall be voidable by Lender. Within ten (10) days after
Lender’s request, Borrower shall furnish to Lender a statement of all tenant
security deposits, and copies of all Leases not previously delivered to Lender,
certified by Borrower as being true and correct. Notwithstanding
anything contained in the Loan Documents, Lender’s approval shall not be
required for future Leases or Lease extensions or modifications if the following
conditions are satisfied: (A) there exists no Default or Event
of Default; (B) the Lease is on the standard Lease form approved by Lender
with no material modifications, except for commercially reasonable changes
agreed to in the ordinary course of Borrower’s business, provided, however,
there shall be no material modification to any provisions with regard to
subordination and attornment, estoppels and other such certificates or liability
or indemnification clauses with respect to landlord without Lender’s prior
written consent; (C) the Lease does not conflict with any restrictive
covenant affecting the Property or any other Lease for space in the Property;
(D) the Lease is not and would not be, after any such extension or modification,
a Major Lease; (E) the Lease shall provide for rental
58
rates
and
landlord concessions comparable to existing local market rates, shall be
an arms
length transaction and in no event be with an Affiliate of Borrower, and
shall
be established pursuant to the Leasing Guidelines attached hereto as Schedule
IV; (F) the Lease shall be to a tenant which Borrower, in its professional
and commercially reasonably judgment, has determined is creditworthy; (G)
the
Lease shall not contain any options or right of renewal, extension or expansion
by tenant at rental rates which are below reasonably comparable market rates
at
the time such Lease is to be executed; and (H) the Lease is for a term of
not
more than ten (10) years, exclusive of renewal options or rights, which together
with the initial term shall not exceed fifteen (15) years). Lender
shall execute and deliver a Subordination Non-Disturbance and Attornment
Agreement in the form annexed hereto as Schedule IV to Tenants under
future commercial Major Leases approved by Lender promptly upon request with
such commercially reasonable changes as may be requested by Tenants, from
time
to time, and which are reasonably acceptable to Lender.
(b) Borrower
(i) shall perform the obligations which Borrower is required to perform
under the Leases; (ii) shall enforce the obligations to be performed by the
tenants; (iii) shall promptly furnish to Lender any notice of default or
termination received by Borrower from any tenant, and any notice of default
or
termination given by Borrower to any tenant; (iv) shall not collect any
rents for more than thirty (30) days in advance of the time when the same
shall
become due, except for bona fide security deposits not in excess of an amount
equal to two months rent; (v) shall not enter into any ground Lease or
master Lease of any part of the Property; (vi) shall not further assign or
encumber any Lease; (vii) shall not, except with Lender’s prior written
consent, cancel or accept surrender or termination of any Lease;
(viii) shall not, except with Lender’s prior written consent, modify or
amend any Lease (except for minor modifications and amendments entered into
in
the ordinary course of business, consistent with prudent property management
practices, not affecting the economic terms of the Lease), and (ix) any Lease
termination or cancellation fees shall be paid to Lender and held in the
Rollover Fund. Any action in violation of clauses (v), (vi), (vii),
and (viii) of this Section 4.1.9(b) shall be void at the election of
Lender.
(c) Within
thirty (30) days after the Closing Date, Borrower shall deliver to Lender
the
original of each Tenant Letter of Credit, together with a blank assignment
for
each Tenant Letter of Credit as Lender may reasonably require. While any
Event
of Default exists, Borrower shall use commercially reasonable efforts to
obtain
from the Issuing Bank its consent to an assignment of each Tenant Letter
of
Credit to Lender. Provided no Event of Default exists, Lender shall
(a) at Borrower’s request, promptly return each or any Tenant Letter of Credit
to Borrower in order to allow Borrower to apply or realize upon the same
in
accordance with the terms of the applicable lease or (b) at Borrower’s request,
retain possession of each or any Tenant Letter of Credit, provided, however,
that in the case of this clause (b) Lender shall take all steps
reasonably necessary to assist Borrower in connection with a draw upon the
same
in accordance with the terms of the applicable Lease. Any proceeds of
such a draw shall be deposited in the Clearing Account.
4.1.10 [RESERVED]
4.1.11 Alterations. Lender’s
prior approval shall be required in connection with any alterations to any
Improvements (except tenant improvements under the Xxxxxx & Xxxxxxx
59
Lease,
under any Lease approved by Lender or under any Lease for which approval
was not
required by Lender under this Agreement) (a) adversely affecting structural
components of the Property, utilities, HVAC or the exterior of the building,
(b) that may have a Material Adverse Effect on Borrower’s financial
condition, the value of the Property or the on-going revenues or expenses
of the
Property or (c) the cost of which (including any related alteration,
improvement or replacement) is reasonably anticipated to exceed the Alteration
Threshold which approval may be granted or withheld in Lender’s sole but
reasonable discretion. The provisions of this Section 4.1.11
shall not require Lender’s consent for Restoration work, which consent rights
are instead governed by Section 5.2 hereof. If the total
unpaid amounts incurred and to be incurred with respect to such alterations
to
the Improvements shall at any time exceed the Alteration Threshold, Borrower
shall promptly deliver to Lender as security for the payment of such amounts
and
as additional security for Borrower’s obligations under the Loan Documents any
of the following: (i) cash, (ii) Letters of Credit,
(iii) U.S. Obligations, (iv) other securities acceptable to Lender,
provided that Lender shall have received a Rating Agency Confirmation as
to the
form and issuer of same, or (v) a completion bond, provided that Lender
shall have received a Rating Agency Confirmation as to the form and issuer
of
same. Such security shall be in an amount equal to the excess of the
total unpaid amounts incurred and to be incurred with respect to such
alterations to the Improvements (other than such amounts to be paid or
reimbursed by Tenants under the Leases) over the Alteration
Threshold.
4.1.12 Material
Agreements. Borrower shall (a) diligently perform
and/or observe in all material respects all of the material covenants and
agreements required to be performed and observed by it under each Material
Agreement and Operating Agreement to which it is a party, and shall use
commercially reasonable efforts to preserve and to keep unimpaired its rights
thereunder, (b) promptly notify Lender in writing of the giving of any
notice of any default by any party under any Material Agreement and Operating
Agreement of which it is aware and (c) promptly enforce the performance and
observance of all of the material covenants and agreements required to be
performed and/or observed by the other party under each Material Agreement
and
Operating Agreement to which it is a party in a commercially reasonable
manner.
4.1.13 Performance
by Borrower. Borrower shall in a timely manner observe,
perform and fulfill each and every covenant, term and provision of each Loan
Document executed and delivered by Borrower, and shall not enter into or
otherwise suffer or permit any amendment, waiver, supplement, termination
or
other modification of any Loan Document executed and delivered by Borrower
without the prior consent of Lender.
4.1.14 Costs
of Enforcement/Remedying Defaults. In the event
(a) that the Mortgage is foreclosed in whole or in part or the Note or any
other Loan Document is put into the hands of an attorney for collection,
suit,
action or foreclosure, (b) of the foreclosure of any Lien or Mortgage prior
to or subsequent to the Mortgage in which proceeding Lender is made a party,
(c) of the bankruptcy, insolvency, rehabilitation or other similar
proceeding in respect of Borrower or Guarantor or an assignment by Borrower
or
Guarantor for the benefit of its creditors, or (d) Lender shall remedy or
attempt to remedy any Event of Default hereunder, Borrower shall be chargeable
with and agrees to pay all costs incurred by Lender as a result thereof,
including costs of collection and defense (including reasonable attorneys’,
experts’, consultants’ and witnesses’ fees and disbursements) in connection
therewith and in connection
60
with
any
appellate proceeding or post-judgment action involved therein, which shall
be
due and payable on demand, together with interest thereon from the date incurred
by Lender at the Default Rate, and together with all required service or
use
taxes.
4.1.15 Business
and Operations. Borrower will continue to engage in the
businesses currently conducted by it as and to the extent the same are necessary
for the ownership and leasing of the Property. Borrower will qualify
to do business and will remain in good standing under the laws of each
jurisdiction as and to the extent the same are required for the ownership
and
leasing of the related Property. Borrower shall at all times cause
the Property to be maintained as a “Class A” office property consistent with
other “Class A” office properties located in Los Angeles,
California.
4.1.16 Loan
Fees. Borrower shall pay all fees and costs (including,
without limitation, all origination and commitment fees) required of Borrower
pursuant to the terms of that certain fee letter between Borrower and Eurohypo
AG, New York Branch, of even date herewith (the “Fee
Letter”).
4.1.17 [Reserved]
4.1.18 Handicapped
Access.
(a) Borrower
covenants and agrees that the Property shall at all times strictly comply
to the
extent applicable with the requirements of the Americans with Disabilities
Act
of 1990, the Fair Housing Amendments Act of 1988, all state and local laws
and
ordinances related to handicapped access and all rules, regulations, and
orders
issued pursuant thereto including, without limitation, the Americans with
Disabilities Act Accessibility Guidelines for Buildings and Facilities
(collectively, “Access Laws”).
(b) Notwithstanding
any provisions set forth herein or in any other document regarding Lender’s
approval of alterations of the Property, Borrower shall not alter the Property
in any manner which would increase Borrower’s responsibilities for compliance
with the applicable Access Laws without the prior written approval of
Lender. The foregoing shall apply to tenant improvements constructed
by Borrower or by any of its tenants. Lender may condition any such
approval upon receipt of a certificate of Access Law compliance from an
architect, engineer, or other person acceptable to Lender.
(c) Borrower
covenants and agrees to give prompt notice to Lender of the receipt by Borrower
of any written complaints related to violation of any Access Laws by any
Governmental Authority and of the commencement of any proceedings or
investigations which relate to the Property’s compliance with applicable Access
Laws.
4.1.19 Management
Agreement. Borrower shall maintain the Management
Agreement in full force and effect and timely perform all of Borrower’s
obligations thereunder and enforce performance of all obligations of the
Manager. Borrower will enter into and cause the Manager to enter into
the Assignment of Management Agreement in form satisfactory to Lender, assigning
and subordinating the manager’s interest in the Property and all fees and other
rights of the Manager pursuant to such Management Agreement to the rights
of
Lender.
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4.1.20 Notice
of Certain Events. Promptly upon becoming aware of them,
Borrower shall notify Lender of (a) any Default or Event of Default,
together with a detailed statement of the steps being taken to cure such
Default
or Event of Default; (b) any written notice of default received by Borrower
under other obligations relating to the Property or otherwise material to
Borrower’s business; and (c) any threatened (in writing) or pending legal,
judicial or regulatory proceedings, including any dispute between Borrower
and
any Governmental Authority, affecting Borrower or the Property.
4.1.21 Further
Assurances. Borrower shall promptly (a) cure any
defects in the execution and delivery of the Loan Documents, (b) execute
and deliver, or cause to be executed and delivered, all such other documents,
agreements and instruments as Lender may reasonably request to further evidence
and more fully describe the collateral for the Loan, to correct any omissions
in
the Loan Documents, to perfect, protect or preserve any Liens created under
any
of the Loan Documents, or to make any recordings, file any notices, or obtain
any consents, as may be necessary or appropriate in connection therewith
and (c)
do all such further lawful and reasonable acts, conveyances and assurances
for
the better and more effectively carrying out of the intents and purposes
of this
Agreement and the other Loan Documents as Lender shall reasonably require
from
time to time. Borrower grants Lender an irrevocable power of attorney
coupled with an interest for the purpose of exercising and perfecting any
and
all rights and remedies available to Lender under the Loan Documents, at
law and
in equity, including without limitation such rights and remedies available
to
Lender pursuant to Sections 10.2, 10.3, and
10.4.
4.1.22 Taxes
on Security. Borrower shall pay all taxes, charges,
filing, registration and recording fees, excises and levies payable with
respect
to the Notes or the Liens created or secured by the Loan Documents, other
than
income, franchise and doing business taxes imposed on Lender. If
there shall be enacted any law (a) deducting the Loan from the value of the
Property for the purpose of taxation, (b) affecting any Lien on the
Property, or (c) changing existing laws of taxation of mortgages, deeds of
trust, security deeds, or debts secured by real property, or changing the
manner
of collecting any such taxes, Borrower shall promptly pay to Lender, on demand,
all taxes, costs and charges for which Lender is or may be liable as a result
thereof; however, if such payment would be prohibited by law or would render
the
Loan usurious, then instead of collecting such payment, Lender may declare
all
amounts owing under the Loan Documents to be immediately due and
payable.
Section
4.2. Borrower
Negative Covenants.
Borrower
covenants and agrees with Lender that:
4.2.1 Liens. Borrower
shall not create, incur, assume or suffer to exist any Lien on any of Borrower’s
right, title or interest in and to the Property, except for Permitted
Encumbrances. Within thirty (30) days of the filing of any such Lien
(or such sooner period as may be required in the event the Property (or part
thereof or interest therein) shall be in imminent danger of being sold,
forfeited, terminated, cancelled or lost or there shall be any danger of
the
Lien of the Mortgage being primed by any related Lien), Borrower shall either
pay or otherwise cause such Lien to be discharged from the Property. After
prior
written notice to Lender, Borrower, at its own expense, may contest by
appropriate legal proceeding, promptly initiated and conducted in good faith
and
with due diligence, the amount or validity or application in
62
whole
or
in part of the Lien, provided that (i) no Default (other than a Default that
is
the subject matter being contested) or Event of Default has occurred and
remains
uncured; (ii) such proceeding shall be permitted under and be conducted in
accordance with the applicable provisions of any other instrument to which
Borrower or the Property is subject and shall not constitute a default
thereunder and such proceeding shall be conducted in accordance with all
applicable statutes, laws and ordinances; (iii) the Property nor any part
thereof or interest therein will not be in danger of being sold, forfeited,
terminated, cancelled or lost; (iv) Borrower shall promptly upon final
determination thereof pay the amount of any such Lien (and perform any such
act
to discharge the same of record), together with all costs, interest and
penalties which may be payable in connection therewith; (v) such proceeding
shall suspend the enforcement of the Lien by any party against the Property;
and
(vi) Borrower shall furnish such security as may be required in the proceeding
in order to suspend the enforcement of such Lien, or as may be reasonably
requested by Lender, to insure the payment (and discharge from record) of
any
such Lien, together with all interest and penalties thereon. Lender
may pay over any such cash deposit or part thereof held by Lender to the
claimant entitled thereto at any time when, in the reasonable judgment of
Lender, the entitlement of such claimant is established or the Property (or
part
thereof or interest therein) shall be in imminent danger of being sold,
forfeited, terminated, cancelled or lost or there shall be any danger of
the
Lien of the Mortgage being primed by any related Lien.
4.2.2 Dissolution. Borrower
shall not (a) engage in any dissolution, liquidation or consolidation or
merger with or into any other business entity, (b) engage in any business
activity not related to the ownership and operation of the Property, (c)
transfer, lease or sell, in one transaction or any combination of transactions,
all or substantially all of the property or assets of Borrower except to
the
extent expressly permitted by the Loan Documents, or (d) cause, permit or
suffer any SPC Party to (i) dissolve, wind up or liquidate or take any
action, or omit to take an action, as a result of which such SPC Party would
be
dissolved, wound up or liquidated in whole or in part, or (ii) amend,
modify, waive or terminate the certificate of incorporation or bylaws of
such
SPC Party, in each case without obtaining the prior consent of
Lender.
4.2.3 Debt
Cancellation. Borrower shall not cancel or otherwise
forgive or release any material claim or debt (other than termination of
Leases
in accordance herewith) owed to Borrower by any Person, except for adequate
consideration and in the ordinary course of Borrower’s business or for other
legal or business considerations deemed prudent by Borrower.
4.2.4 Zoning. Borrower
shall not initiate or consent to any zoning reclassification of any portion
of
the Property or seek any variance under any existing zoning ordinance or
use or
permit the use of any portion of the Property in any manner that could result
in
such use becoming a non-conforming use under any zoning ordinance or any
other
applicable land use law, rule or regulation, without the prior written consent
of Lender.
4.2.5 No
Joint Assessment. Borrower shall not suffer, permit or
initiate the joint assessment of the Property (a) with any other real
property constituting a tax lot separate from the Property, and (b) with
any portion of the Property which may be deemed to constitute personal property,
or any other procedure whereby the lien of any taxes which may be levied
against
such personal property shall be assessed or levied or charged to the
Property.
63
4.2.6 Principal
Place of Business. Borrower shall not change its
principal place of business from the address set forth on the first page
of this
Agreement without first giving Lender thirty (30) days prior
notice.
4.2.7 ERISA.
(a) Borrower
shall not engage in any transaction which would cause any obligation, or
action
taken or to be taken, hereunder (or the exercise by Lender of any of its
rights
under the Notes, this Agreement or the other Loan Documents) to be a non-exempt
(under a statutory or administrative class exemption) prohibited transaction
under the Employee Retirement Income Security Act of 1974, as amended
(“ERISA”).
(b) Borrower
shall deliver to Lender such certifications or other evidence from time to
time
throughout the term of the Loan, as requested by Lender in its sole discretion,
that (i) Borrower is not an “employee benefit plan” as defined in
Section 3(3) of ERISA, which is subject to Title I of ERISA, or a
“governmental plan” within the meaning of Section 3(32) of ERISA;
(ii) Borrower is not subject to any state statute regulating investments
of, or fiduciary obligations with respect to, governmental plans; and
(iii) one or more of the following circumstances is true:
(A) Equity
interests in Borrower are publicly offered securities, within the meaning
of 29
C.F.R. §2510.3-101(b)(2);
(B) Less
than twenty-five percent (25%) of each outstanding class of equity interests
in
Borrower is held by “benefit plan investors” within the meaning of 29 C.F.R.
§2510.3-101(f)(2); or
(C) Borrower
qualifies as an “operating company” or a “real estate operating company” within
the meaning of 29 C.F.R. §2510.3-101(c) or (e).
4.2.8 Material
Agreements. Except as otherwise expressly permitted by
this Agreement or the other Loan Documents, Borrower shall not, without Lender’s
prior written consent (which consent shall not be unreasonably withheld,
conditioned or delayed): (a) enter into, surrender or terminate any
Material Agreement or Operating Agreement to which it is a party (unless
the
other party thereto is in material default and the termination of such agreement
would be commercially reasonable or unless such action would not reasonably
be
anticipated to have a Material Adverse Effect), (b) increase or consent to
any
material increase in the amount of any charges under any Material Agreement
or
Operating Agreement to which it is a party, except as provided therein or
on an
arms-length basis and commercially reasonable terms; or (c) otherwise modify,
change, supplement, alter or amend, or waive or release any of its rights
and
remedies under any Material Agreement or Operating Agreement to which it
is a
party in any material respect, except on an arms’-length basis and commercially
reasonable terms. Lender’s approval for any action requiring Lender’s
approval hereunder shall not be required if the costs related to the new
Material Agreement, or the proposed modification or amendment thereto, is
reflected in an Annual Budget that has been approved in writing by Lender,
and a
replacement agreement is entered into that is otherwise in form and substance
substantially similar to the prior
64
Material
Agreement or such Material Agreement prior to such modification or amendment
thereto. Whenever such approval or consent is required pursuant to
this Section 4.2.8, Lender shall use good faith efforts to respond within
ten (10) Business Days after Lender’s receipt of Borrower’s written request for
such approval or consent, as applicable, such request to include such evidence
as would be requested by a reasonably prudent lender in connection with its
decision to approve or consent to the matters provided in this Section
4.2.8. If Lender fails to respond to such request within ten (10)
Business Days, and Borrower sends a second request which contains a bold
faced,
conspicuous legend at the top of the first page stating “IF YOU FAIL TO RESPOND
TO THIS REQUEST FOR APPROVAL AND/OR CONSENT WITHIN SEVEN (7) BUSINESS DAYS,
YOUR
APPROVAL AND/OR CONSENT SHALL BE DEEMED GIVEN”, and if Lender fails to respond
within seven (7) Business Days of its receipt of such second request and
Lender
has received such evidence detailed above, then such approval or consent,
as
applicable, will be deemed to have been given; provided, however, such
provisions shall not apply to Section 7.3 hereof
4.2.9 REA. Borrower
agrees that without the prior written consent of Lender, Borrower will not
execute modifications to the REA.
4.2.10 Xxxxxx
& Xxxxxxx U.S. Bank Tower Lease Takeover Agreement. Borrower
agrees to perform all its obligations under the Xxxxxx & Xxxxxxx U.S. Bank
Tower Lease Takeover Agreement. Borrower shall not enter into any
modification or supplement to the U.S. Bank Tower Lease or the Xxxxxx &
Xxxxxxx U.S. Bank Tower Lease Takeover Agreement, nor incur any additional
obligations to Xxxxxx & Xxxxxxx LLP with respect to the Xxxxxx & Xxxxxxx
U.S. Bank Tower Lease or the premises leased thereunder (other than the
obligations under the Xxxxxx & Xxxxxxx U.S. Bank Tower Lease Takeover
Agreement) without Lender’s prior written consent. Borrower shall not
permit Xxxxxx & Xxxxxxx to exercise any extension option that remains
available under the U.S. Bank Tower Lease without Lender’s prior written
consent.
4.2.11 O
& M Agreement. Borrower covenants and agrees that,
during the term of the Loan, including any extension or renewal thereof,
Borrower shall comply in all respects with the terms and conditions of any
operations and maintenance program for asbestos containing materials, mold
or
other item as recommended in the Environmental Report or Property Condition
Report (“O & M Program”). Borrower shall
protect, indemnify, and hold harmless Lender and its successors and assigns,
respective parents, subsidiaries and affiliates, their respective officers,
directors, shareholders, members, managers, employees and agents, and their
respective heirs, legal representatives, successors and assigns from and
against
all liabilities, obligations, claims, demands, damages, penalties, causes
of
action, losses, fines, costs and expenses (including without limitation
reasonable attorneys' fees and expenses), imposed upon or incurred by or
asserted against Lender by reason of Borrower's failure to comply with the
O
& M Program as required under this Agreement, which shall survive any
termination, satisfaction or assignment of the Loan Documents or the entry
of a
judgment of foreclosure, sale of the Property by nonjudicial foreclosure
sale,
delivery of a deed in lieu of foreclosure or the exercise by Lender of any
of
its other rights and remedies under the Loan Documents.
4.2.12 Change
in Business. Borrower shall not enter into any line of
business other than the ownership and operation of the Property.
65
4.2.13 Affiliate
Transactions. Borrower shall not enter into, or be a
party to, any transaction with an Affiliate of Borrower or any of the partners
of Borrower except in the ordinary course of business and on terms which
are
fully disclosed to Lender in advance and are no less favorable to Borrower
or
such Affiliate than would be obtained in a comparable arm’s-length transaction
with an unrelated third party. Lender hereby approves the agreements
referenced on Schedule IX attached hereto.
4.2.14 Assets. Borrower
shall not purchase or own any property other than the Property and any property
necessary or incidental for the operation of the Property.
|
|
V.
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INSURANCE,
CASUALTY AND CONDEMNATION
|
Section
5.1. Insurance.
5.1.1 Insurance
Policies.
(a) Borrower
shall obtain and maintain, or cause to be maintained, insurance for Borrower
and
the Property providing at least the following coverages:
(i) comprehensive
all risk insurance on the Improvements and the personal property at the Property
(A) in an amount equal to one hundred percent (100%) of the “Full
Replacement Cost,” which for purposes of this Agreement shall mean actual
replacement value (exclusive of costs of excavations, foundations, underground
utilities and footings) with a waiver of depreciation, but the amount shall
in
no event be less than the outstanding principal balance of the Loan;
(B) containing an agreed amount endorsement with respect to the
Improvements and personal property at the Property waiving all co-insurance
provisions; (C) providing for no deductible in excess of One Hundred
Thousand and No/100 Dollars ($100,000.00) for non-catastrophic perils; and
(D) containing an “Ordinance or Law Coverage” or “Enforcement” endorsement
with coverage limits acceptable to Lender if any of the Improvements or the
use
of the Property shall at any time constitute legal non-conforming structures
or
uses. In addition, Borrower shall obtain: (y) if any
portion of the Improvements is currently or at any time in the future located
in
a federally designated “special flood hazard area,” flood hazard insurance in an
amount equal to the lesser of (1) the outstanding principal balance of the
Notes or (2) the maximum amount of such insurance available under the
National Flood Insurance Act of 1968, the Flood Disaster Protection Act of
1973
or the National Flood Insurance Reform Act of 1994, as each may be amended
or
such greater amount as Lender shall require; and (z) earthquake insurance
(which earthquake insurance is limited to an amount not less than the product
of
(I) the probable maximum loss applicable to the Property, as set forth in
the
Seismic Analysis, multiplied by (II) the replacement cost of
Improvements, as set forth in the Appraisal) and windstorm insurance in amounts
and in form and substance satisfactory to Lender in the event the Property
is
located in an area with a high degree of seismic activity, provided that
the
insurance pursuant to clauses (y) and (z) hereof shall be on terms consistent
with the comprehensive all risk insurance policy required under this
subsection (i).
66
(iii) business
income insurance (A) with loss payable to Lender; (B) covering all
risks required to be covered by the insurance provided for in
subsection (i) above for a period commencing at the time of loss for such
length of time as it takes to repair or replace with the exercise of due
diligence and dispatch; (C) containing an extended period of indemnity
endorsement which provides that after the physical loss to the Improvements
and
Personal Property has been repaired, the continued loss of income will be
insured until such income either returns to the same level it was at prior
to
the loss, or the expiration of twelve (12) months from the date that the
Property is repaired or replaced and operations are resumed, whichever first
occurs, and notwithstanding that the policy may expire prior to the end of
such
period; and (D) in an amount equal to one hundred percent (100%) of the
projected gross income from the Property for a period from the date of loss
to a
date (assuming total destruction) which is twelve (12) months from the date
that
the Property is repaired or replaced and operations are resumed. The
amount of such business income insurance shall be determined prior to the
date
hereof and at least once each year thereafter based on Borrower’s reasonable
estimate of the gross income from the Property for the succeeding twelve
(12)
month period. All proceeds payable to Lender pursuant to this
subsection shall be held by Lender and shall be applied to the obligations
secured by the Loan Documents from time to time due and payable hereunder
and
under the Notes; provided, however, that nothing herein contained shall be
deemed to relieve Borrower of its obligations to pay the obligations secured
by
the Loan Documents on the respective dates of payment provided for in the
Notes
and the other Loan Documents except to the extent such amounts are actually
paid
out of the proceeds of such business income insurance;
(iv) at
all times during which structural construction, repairs or alterations are
being
made with respect to the Improvements, and only if the Property coverage
form
does not otherwise apply, (A) owner’s contingent or protective liability
insurance covering claims not covered by or under the terms or provisions
of the
above mentioned commercial general liability insurance policy; and (B) the
insurance provided for in subsection (i) above written in a so-called
builder’s risk completed value form (1) on a non-reporting basis,
(2) against all risks insured against pursuant to subsection (i)
above, (3) including permission to occupy the Property, and (4) with
an agreed amount endorsement waiving co-insurance provisions;
67
(vi) comprehensive
boiler and machinery insurance, if applicable, in amounts as shall be reasonably
required by Lender on terms consistent with the commercial property insurance
policy required under subsection (i) above;
(vii) umbrella
liability insurance in addition to primary coverage in an amount not less
than
$100,000,000.00 per occurrence on terms consistent with the commercial general
liability insurance policy required under subsection (ii) above and (viii)
below;
(viii) motor
vehicle liability coverage for all owned and non-owned vehicles, including
rented and leased vehicles containing minimum limits per occurrence of One
Million and No/100 Dollars ($1,000,000.00);
(ix) so-called
“dramshop” insurance or other liability insurance required in connection with
the sale of alcoholic beverages, if served at the Property. If such
alcoholic beverages are served at the Property by a third party, Borrower
shall
cause such third party to obtain and maintain so-called “dramshop” insurance or
other liability insurance required in connection with the sale of alcoholic
beverages, naming Lender and Borrower each as additional insureds;
(x) insurance
against employee dishonesty in an amount not less than one (1) month of Gross
Income From Operations from the Property and with a deductible not greater
than
Fifty Thousand and No/100 Dollars ($50,000);
(xi) If
the commercial property and business income insurance policies required under
subsections (i) and (iii) above do not cover perils of terrorism or acts
of
terrorism, Borrower shall maintain commercial property and business income
insurance for loss resulting from perils and acts of terrorism on terms
(including amounts) consistent with those required under subsections (i)
and
(iii) above. The claims paying ability rating of the insurer shall be
consistent with the requirements of Section 5.1.2 hereof or, if no
insurer of such claims paying ability rating is then issuing such terrorism
insurance, the chosen insurer shall be the insurer which is offering such
terrorism insurance and which has a claims paying ability rating the closest
to
that required by Section 5.1.2 hereof.
(xii) If
perils of terrorism and acts of terrorism or other similar acts or events
are
hereafter excluded from Borrower’s comprehensive all risk insurance policy or
business income insurance coverage required under subsections (i) and (iii)
above, Borrower shall obtain an endorsement to such policy, or a separate
policy
from an insurance provider which meets the requirements set forth in
Section 5.1.2 below or is
68
otherwise
satisfactory to Lender, insuring against all such excluded acts or events
in the
amounts required for such coverage under subsections (i) and (iii) above,
or such lesser amount as may be approved by Lender in its sole
discretion. The endorsement or policy shall be in form and substance
reasonably satisfactory to Lender and shall meet Rating Agency criteria for
securitized loans;
(xiii) upon
sixty (60) days’ notice, such other reasonable insurance and in such reasonable
amounts as Lender from time to time may reasonably request against such other
insurable hazards which at the time are commonly insured against for property
similar to the Property located in or around the region in which the Property
is
located; and
(xiv) Lender
shall be satisfied that, upon the completion of the Restoration, (I) the
Loan to
Value Ratio for the Property is equal to at least that which it was immediately
preceding the Casualty or Condemnation of the Property, as determined by
Lender
in its sole discretion, and (II) the Debt Service Coverage Ratio on the
outstanding principal amount of the Loans shall be at or above 1.10:1.00,
whichever is greater.
(b) All
insurance provided for in Section 5.1.1(a) shall be obtained under
valid and enforceable policies (collectively, the
“Policies” or, in the singular, the
“Policy”) and, to the extent
not specified above, shall
be subject to the approval of Lender as to deductibles, loss payees and
insureds. Not less than ten (10) days prior to the expiration dates
of the Policies theretofore furnished to Lender, evidence of renewal of such
insurance (which may be provided in the form of certificates of insurance
policy
binders, or other evidence reasonably satisfactory to Lender of such renewal
accompanied by evidence satisfactory to Lender of payment of the premiums
then
due thereunder (the “Insurance Premiums”), shall be
delivered by Borrower to Lender.
(c) All
insurance required hereunder may be effected by one or more blanket Policies
covering the Property and other property and assets of Affiliates of Borrower
or
REIT not constituting a part of the Property. Any blanket insurance
Policy shall specifically allocate to the Property the amount of coverage
from
time to time required hereunder and shall otherwise provide the same protection
as would a separate Policy insuring only the Property in compliance with
the
provisions of Section 5.1.1(a).
(d) All
Policies of insurance provided for or contemplated by
Section 5.1.1(a) shall be primary coverage and, except for the
Policy referenced in Section 5.1.1(a)(v), shall name Borrower as the
insured and Lender and its successors and/or assigns as the additional insured,
as its interests may appear, and in the case of property damage, boiler and
machinery, flood, earthquake and terrorism insurance, shall contain a so-called
New York standard non-contributing mortgagee clause in favor of Lender providing
that the loss thereunder shall be payable to Lender. Borrower shall
not procure or permit any of its constituent entities to procure any other
insurance coverage which would be on the same level of payment as the Policies
or would adversely impact in any way the ability of Lender or Borrower to
collect any proceeds under any of the Policies.
69
(e) All
Policies of insurance provided for in Section 5.1.1(a), except for
the Policies referenced in Section 5.1.1(a)(v) and (a)(viii),
shall contain clauses or endorsements to the effect, or otherwise provide,
that:
(i) no
act or negligence of Borrower, or anyone acting for Borrower, or of any Tenant
or other occupant, or failure to comply with the provisions of any Policy,
which
might otherwise result in a forfeiture of the insurance or any part thereof,
shall in any way affect the validity or enforceability of the insurance insofar
as Lender is concerned;
(ii) the
Policy shall not be canceled or permitted to lapse without at least thirty
(30)
days’ written notice (or ten (10) days notice for non-payment of premium) to
Lender and any other party named therein as an additional insured and, shall
not
be materially changed (other than to increase the coverage provided thereby)
without such a thirty (30) day notice; and
(iii) Lender
shall not be liable for any Insurance Premiums thereon or subject to any
assessments thereunder.
(f) If
at any time Lender is not in receipt of written evidence that all insurance
required hereunder is in full force and effect, Lender shall have the right,
without notice to Borrower, to take such action as Lender deems necessary
to
protect its interest in the Property, including, without limitation, the
obtaining of such insurance coverage as Lender in its sole discretion deems
appropriate and all premiums incurred by Lender in connection with such action
or in obtaining such insurance and keeping it in effect shall be paid by
Borrower to Lender upon demand and until paid shall be secured by the Mortgage
and shall bear interest at the Default Rate.
(g) In
the event of foreclosure of the Mortgage or other transfer of title to the
Property in extinguishment in whole or in part of the Debt, all right, title
and
interest of Borrower in and to the Policies that are not blanket Policies
then
in force concerning the Property and all proceeds payable thereunder shall
thereupon vest in the purchaser at such foreclosure or Lender or other
transferee in the event of such other transfer of title.
5.1.2 Insurance
Company. The Policies shall be issued by financially
sound and responsible insurance companies authorized to do business in the
state
in which the Property is located and having a claims paying ability rating
of
“A” or better by S&P and the equivalent rating by one of the other Rating
Agencies. Notwithstanding the foregoing, up to forty percent (40%) of
the commercial property insurance required under Section 5.1.1(a)(i)
above (including boiler and machinery coverage and terrorism coverage required
under Sections 5.1.1(a)(vi) and 5.1.1(a)(x)) may be issued by
companies that do not have a claims paying ability rating of “A” or better,
provided that (i) there shall be five (5) or more insurance companies
providing such coverage, (ii) the primary layers of such coverage are provided
by insurers having claims paying abilities of “A” or better (or the equivalent
thereof), (iii) such insurance companies otherwise satisfy the criteria set
forth in the preceding sentence, and (iv) each such insurance company shall
have
a financial strength rating from S&P of at least “BBB” (or the equivalent
thereof).
70
Section
5.2. Casualty
and Condemnation.
5.2.1 Casualty. If
the Property shall sustain a Casualty, Borrower shall give prompt notice
of such
Casualty to Lender and shall promptly commence and diligently prosecute to
completion the repair and restoration of the Property as nearly as possible
to
the condition the Property was in immediately prior to such Casualty (a
“Restoration”) and otherwise in accordance with
Section 5.3, it being understood, however, that Borrower
shall not
be obligated to restore the Property to the precise condition of the Property
prior to such Casualty provided the Property is restored, to the extent
practicable, to be of at least equal value and of substantially the same
character as prior to the Casualty. Borrower shall pay all costs of
such Restoration whether or not such costs are covered by
insurance. Lender may, but shall not be obligated to, make proof of
loss if not made promptly by Borrower. In the event of a Casualty
where the loss does not exceed the Restoration Threshold, Borrower may settle
and adjust such claim; provided that (a) no Event of Default has occurred
and is continuing and (b) such adjustment is carried out in a commercially
reasonable and timely manner. In the event of a Casualty where the
loss exceeds the Restoration Threshold or if an Event of Default then exists,
Borrower may settle and adjust such claim only with the prior written consent
of
Lender (which consent shall not be unreasonably withheld or delayed) and
Lender
shall have the opportunity to participate, at Borrower’s cost, in any such
adjustments. Notwithstanding any Casualty, Borrower shall continue to
pay the Debt at the time and in the manner provided for its payment in the
Notes
and in this Agreement.
5.2.2 Condemnation. Borrower
shall give Lender prompt notice of any actual or threatened commencement
of a
Condemnation proceeding by any Governmental Authority of all or any part
of the
Property and shall deliver to Lender a copy of any and all papers served
in
connection with such proceedings. Borrower may settle and compromise
the Condemnation only with the prior written consent of Lender (which consent
shall not be unreasonably withheld or delayed) and Lender shall have the
opportunity to participate, at Borrower’s cost, in any litigation and settlement
discussions in respect thereof and Borrower shall from time to time deliver
to
Lender all instruments reasonably requested by Lender to permit such
participation. Borrower shall, at its expense, diligently prosecute
any such proceedings, and shall consult with Lender, its attorneys and experts,
and cooperate with them in the carrying on or defense of any such
proceedings. Lender is hereby irrevocably appointed as Borrower’s
attorney-in-fact, coupled with an interest, while an Event of Default exists,
with exclusive power to collect, receive and retain any Award for application
in
accordance with this Agreement and to make any compromise or settlement in
connection with any such Condemnation. Notwithstanding any
Condemnation, Borrower shall continue to pay the Debt at the time and in
the
manner provided for its payment in the Notes and in this
Agreement. Lender shall not be limited to the interest paid on the
Award by any Governmental Authority but shall be entitled to receive out
of the
Award interest accruing on the Debt at the rate or rates provided herein
or in
the Notes. If the Property or any portion thereof is taken in
Condemnation by any Governmental Authority, Borrower shall promptly commence
and
diligently prosecute the Restoration of the Property and otherwise comply
with
the provisions of Section 5.3. If the Property is sold,
through foreclosure or otherwise, prior to the receipt by Lender of the Award,
Lender shall have the right, whether or
71
not
a
deficiency judgment on the Notes shall have been sought, recovered or denied,
to
receive the Award, or a portion thereof sufficient to pay the Debt.
5.2.3 Casualty
Proceeds. Notwithstanding the last sentence of
Section 5.1.1(a)(iii) and provided no Event of Default then exists
hereunder, proceeds received by Lender on account of
the business
interruption insurance specified in Section 5.1.1(a)(iii) above with
respect to any Casualty shall be deposited by Lender directly into the Deposit
Account (as defined in the Cash Management Agreement) but (a) only to the
extent it reflects a replacement for lost Rents that would have been due
under
Leases existing on the date of such Casualty, and (b) only to the extent
necessary to fully make the disbursements required by Section 3.3 (a)(i)
through (v) of the Cash Management Agreement. All other such
proceeds shall be held by Lender and disbursed in accordance with Section
5.3 hereof.
Section
5.3. Delivery
of Net Proceeds.
5.3.1 Minor
Casualty or Condemnation. If a Casualty or Condemnation
has occurred to the Property and the Net Proceeds shall be less than the
Restoration Threshold and the reasonably anticipated costs of completing
the
Restoration shall be less than the Restoration Threshold, and provided (a)
no
Event of Default shall have occurred and remain uncured and (b) the Casualty
or
Condemnation shall have occurred prior to the Maturity Date, the Net Proceeds
will be disbursed by Lender to Borrower. Promptly after receipt of
the Net Proceeds, Borrower shall commence and satisfactorily complete with
reasonable diligence the Restoration in accordance with the terms of this
Agreement. If any Net Proceeds are received by Borrower and may be
retained by Borrower pursuant to the terms hereof, such Net Proceeds shall,
until completion of the Restoration, be held in trust for Lender and shall
be
segregated from other funds of Borrower to be used to pay for the cost of
Restoration in accordance with the terms hereof.
5.3.2 Major
Casualty or Condemnation.
(a) If
a Casualty or Condemnation has occurred to the Property and the Net Proceeds
are
equal to or greater than the Restoration Threshold or the costs of completing
the Restoration are reasonably anticipated to be equal to or greater than
the
Restoration Threshold, Lender shall make the Net Proceeds available for the
Restoration, provided that each of the following conditions are
met:
(i) no
Event of Default shall have occurred and be continuing;
(ii) (A) in
the event the Net Proceeds are insurance proceeds, less than thirty percent
(30%) of the total floor area of the Improvements at the Property has been
damaged, destroyed or rendered unusable as a result of such Casualty or
(B) in the event the Net Proceeds are an Award, less than fifteen percent
(15%) of the land constituting the Property is taken, and such land is located
along the perimeter or periphery of the Property, and no portion of the
Improvements is the subject of the Condemnation;
(iii) Leases
requiring payment of annual rent equal to sixty-five percent (65%) of the
Gross
Income from Operations received by Borrower during the
72
twelve
(12) month period immediately preceding the Casualty or Condemnation and
all
Major Leases shall remain in full force and effect during and after the
completion of the Restoration without abatement of rent beyond the time required
for Restoration, notwithstanding the occurrence of such Casualty or
Condemnation;
(iv) Borrower
shall commence the Restoration as soon as reasonably practicable (but in
no
event later than sixty (60) days after such Casualty or Condemnation, whichever
the case may be, occurs) and shall diligently pursue the same to satisfactory
completion;
(v) Lender
shall be satisfied that any operating deficits and all payments of principal
and
interest under the Notes will be paid during the period required for Restoration
from (A) the Net Proceeds, or (B) other funds of
Borrower;
(vi) Lender
shall be satisfied that the Restoration will be completed on or before the
earliest to occur of (A) the date six (6) months prior to the Maturity
Date, (B) the earliest date required for such completion under the terms of
any Lease, (C) such time as may be required under applicable Legal
Requirements in order to repair and restore the Property to the condition
it was
in immediately prior to such Casualty or to as nearly as possible the condition
it was in immediately prior to such Condemnation, as applicable or (D) the
expiration of the insurance coverage referred to in
Section 5.1.1(a)(iii);
(vii) the
Property and the use thereof after the Restoration will be in compliance
with
and permitted under all applicable Legal Requirements;
(viii) the
Restoration shall be done and completed by Borrower in an expeditious and
diligent fashion and in compliance with all applicable Legal
Requirements;
(ix) such
Casualty or Condemnation, as applicable, does not result in the loss of access
to the Property or the related Improvements;
(x) all
Operating Agreements shall remain in full force and effect; and
(xi) After
giving effect to such Restoration, the Debt Service Coverage Ratio for the
Property shall be equal to the greater of (i) the Debt Service Coverage
Ratio for the twelve (12) full calendar months immediately preceding the
Closing
Date, and (ii) the Debt Service Coverage Ratio for the Property for the
twelve (12) full calendar months immediately preceding the Casualty or
Condemnation of the Property.
(b) The
Net Proceeds shall be paid directly to Lender and held by Lender in an
interest-bearing account and, until disbursed in accordance with the provisions
of this Section 5.3.2, shall constitute additional security for the
Debt. The Net Proceeds (including all interest earned thereon) shall
be disbursed by Lender to, or as directed by, Borrower from time to time
during
the course of the Restoration, upon receipt of evidence satisfactory to Lender
73
that
(i) all requirements set forth in Section 5.3.2(a) have been
satisfied, (ii) all materials installed and work and labor performed in
connection with the requested disbursement (except to the extent that they
are
to be paid for out of the requested disbursement) in connection with the
Restoration have been paid for in full, and (iii) there exist no notices of
pendency, stop orders, mechanic’s or materialman’s liens or notices of intention
to file same, or any other liens or encumbrances of any nature whatsoever
on the
Property arising out of the Restoration which have not either been fully
bonded
to the satisfaction of Lender and discharged of record or in the alternative
fully insured to the reasonable satisfaction of Lender by the title company
issuing the Title Insurance Policy.
(c) All
plans and specifications required in connection with the Restoration shall
be
subject to prior approval of Lender and an independent architect selected
by
Lender (the “Casualty Consultant”). The plans
and specifications shall require that the Restoration be completed in a
first-class workmanlike manner at least equivalent to the quality and character
of the original work in the Improvements (provided, however, that in the
case of
a partial Condemnation, the Restoration shall be done to the extent reasonably
practicable after taking into account the consequences of such partial
Condemnation), so that upon completion thereof, the Property shall be at
least
equal in value and general utility to the Property prior to the damage or
destruction; it being understood, however, that Borrower shall not be obligated
to restore the Property to the precise condition of the Property prior to
such
Casualty provided the Property is restored, to the extent practicable, to
be of
at least equal value and of substantially the same character as prior to
the
Casualty. Borrower shall restore all Improvements such that when they
are fully restored and/or repaired, such Improvements and their contemplated
use
fully comply with all applicable material Legal Requirements. The
identity of the contractors, subcontractors and materialmen engaged in the
Restoration, as well as the contracts under which they have been engaged,
shall
be subject to approval by Lender and the Casualty Consultant. All
costs and expenses incurred by Lender in connection with recovering, holding
and
advancing the Net Proceeds for the Restoration including, without limitation,
reasonable attorneys’ fees and disbursements and the Casualty Consultant’s fees
and disbursements, shall be paid by Borrower. Lender shall use good
faith efforts to respond within ten (10) Business Days of its receipt of
Borrower’s written request for approval of any plans and specifications (or
contractors, subcontractors or materialmen in connection
therewith). If Lender fails to respond to such request within ten
(10) Business Days of such request and Borrower sends a second written notice
which contains a bold faced, conspicuous legend at the top of the first page
stating “IF YOU FAIL TO RESPOND TO THIS REQUEST FOR APPROVAL WITHIN TEN (10)
BUSINESS DAYS, YOUR APPROVAL SHALL BE DEEMED GIVEN”, and if Lender fails to
respond within ten (10) Business Days of its receipt of such second request
and
the related plans and specifications and all information reasonably required
in
order to adequately review the same, then such approval will be deemed to
have
been given.
(d) In
no event shall Lender be obligated to make disbursements of the Net Proceeds
in
excess of an amount equal to the costs actually incurred from time to time
for
work in place as part of the Restoration, as certified by the Casualty
Consultant, less the Casualty Retainage. The term
“Casualty Retainage” shall mean, as to each contractor,
subcontractor or materialman engaged in the Restoration, an amount equal
to ten
percent (10%) of the costs actually incurred for work in place as part of
the
Restoration, as certified by the Casualty Consultant, until the Restoration
has
been completed. The Casualty Retainage shall in no event,
74
and
notwithstanding anything to the contrary set forth above in this
Section 5.3.2(d), be less than the amount actually held back by
Borrower from contractors, subcontractors and materialmen engaged in the
Restoration. The Casualty Retainage shall not be released until the
Casualty Consultant certifies to Lender that the Restoration has been completed
in accordance with the provisions of this Section 5.3.2(d) and that
all approvals necessary for the re-occupancy and use of the Property have
been
obtained from all appropriate Governmental Authorities, and Lender receives
evidence reasonably satisfactory to Lender that the costs of the Restoration
have been paid in full or will be paid in full out of the Casualty Retainage;
provided, however, that Lender will release the portion of the Casualty
Retainage being held with respect to any contractor, subcontractor or
materialman engaged in the Restoration as of the date upon which the Casualty
Consultant certifies to Lender that the contractor, subcontractor or materialman
has satisfactorily completed all work and has supplied all materials in
accordance with the provisions of the contractor’s, subcontractor’s or
materialman’s contract, the contractor, subcontractor or materialman delivers
the lien waivers and evidence of payment in full of all sums due to the
contractor, subcontractor or materialman as may be reasonably requested by
Lender or by the title company issuing the Title Insurance Policy, and Lender
receives an endorsement to the Title Insurance Policy insuring the continued
priority of the lien of the Mortgage and evidence of payment of any premium
payable for such endorsement. If required by Lender, the release of
any such portion of the Casualty Retainage shall be approved by the surety
company, if any, which has issued a payment or performance bond with respect
to
the contractor, subcontractor or materialman.
(e) Lender
shall not be obligated to make disbursements of the Net Proceeds more frequently
than once every calendar month.
(f) If
at any time the Net Proceeds or the undisbursed balance thereof shall not,
in
the opinion of Lender in consultation with the Casualty Consultant, be
sufficient to pay in full the balance of the costs which are estimated by
the
Casualty Consultant to be incurred in connection with the completion of the
Restoration, Borrower shall deposit the deficiency (the “Net Proceeds
Deficiency”) with Lender before any further disbursement of the Net
Proceeds shall be made. The Net Proceeds Deficiency deposited with
Lender shall be held by Lender and shall be disbursed for costs actually
incurred in connection with the Restoration on the same conditions applicable
to
the disbursement of the Net Proceeds, and until so disbursed pursuant to
this
Section 5.3.2 shall constitute additional security for the
Debt.
(g) The
excess, if any, of the Net Proceeds and the remaining balance, if any, of
the
Net Proceeds Deficiency deposited with Lender after the Casualty Consultant
certifies to Lender that the Restoration has been completed in accordance
with
the provisions of this Section 5.3.2, and the receipt by Lender of
evidence satisfactory to Lender that all costs incurred in connection with
the
Restoration have been paid in full, shall be remitted by Lender to Borrower,
provided no Event of Default shall have occurred and shall be continuing
under
any of the Loan Documents; provided, however, the amount of such excess returned
to Borrower in the case of a Condemnation shall not exceed the amount of
Net
Proceeds Deficiency deposited by Borrower with the balance being applied
to the
Debt in the manner provided for in subsection 5.3.2(h).
75
(h) All
Net Proceeds not required (i) to be made available for the Restoration or
(ii) to be returned to Borrower as excess Net Proceeds pursuant to
Section 5.3.2(g) may be retained and applied by Lender toward the
payment of the Debt, whether or not then due and payable, in such order,
priority and proportions as Lender in its sole discretion shall deem proper,
or,
at the discretion of Lender, the same may be paid, either in whole or in
part,
to Borrower for such purposes as Lender shall designate.
|
|
VI.
|
RESERVE
FUNDS
|
Section
6.1. KPMG
Abatement Funds.
6.1.1 Deposits
of KPMG Abatement Funds. On the Closing Date, Borrower
shall deposit with Lender from the proceeds of the Loan the amount of One
Million Two Hundred Fifty Thousand and No/100 Dollars ($1,250,000.00)
representing a portion of the amount of rental abatement available to the
tenant
under the KPMG Lease from and after the Closing Date. Amounts
deposited pursuant to this Section 6.5.1 are referred to herein as the
“KPMG Abatement Funds.” Lender shall cause
the KPMG Abatement Funds to be deposited with Agent for credit to the “KPMG
Abatement Funds Account” established under the Cash Management Agreement within
five (5) Business Days following the Closing Date.
6.1.2 Release
of KPMG Abatement Funds. Lender shall disburse, or cause
to be disbursed, to Borrower the KPMG Abatement Funds upon satisfaction by
Borrower of each of the following conditions: (a) Borrower shall
submit a request for payment to Lender at least ten (10) days prior to the
date
on which Borrower requests such payment be made, (b) on the date such
request is received by Lender and on the date such payment is to be made,
no
Event of Default shall exist and remain uncured, and (c) all rights of the
tenant to xxxxx rent under the KPMG Lease have expired or the Loan has been
fully repaid, whichever is earlier.
Section
6.2. Tax
Funds.
6.2.1 Deposits
of Tax Funds. On the Closing Date, Borrower shall
deposit with Lender the amount of One Million Four Hundred Ninety-Six Thousand
Four Hundred Thirty and No/100 Dollars ($1,496,430.00) and, there shall be
deposited to the Tax Account established under the Cash Management Agreement
on
each Monthly Payment Date an amount equal to one-twelfth of the Taxes that
Lender estimates will be payable during the next ensuing twelve (12) months
in order to accumulate sufficient funds to pay all such Taxes at least
thirty (30) days prior to their respective due dates. Amounts
deposited pursuant to this Section 6.2.1 are referred to herein as the
“Tax Funds.” If at any time Lender reasonably
determines that the Tax Funds will not be sufficient to pay the Taxes, Lender
shall notify Borrower of such determination and the monthly deposits for
Taxes
shall be increased by the amount that Lender estimates is sufficient to make
up
the deficiency at least ten (10) days prior to the respective due dates for
the Taxes; provided that if Borrower receives notice of any deficiency after
the
date that is ten (10) days prior to the date that Taxes are due, Borrower
will
deposit such amount within one (1) Business Day after its receipt of such
notice. Lender shall cause the Tax Funds to be deposited with Agent
for credit to the “Tax Account” established under the Cash Management Agreement
within five (5) Business Days following the Closing Date.
76
Section
6.3. Insurance
Funds.
6.3.1 Deposits
of Insurance Funds. On the Closing Date, Borrower shall
deposit with Lender the amount of One Hundred Seventy-Eight Thousand Two
Hundred
Eighty-Nine and No/100 Dollars ($178,289.00) and there shall be deposited
to the
Insurance Account established under the Cash Management Agreement on each
Monthly Payment Date an amount equal to one-twelfth of the Insurance Premiums
that Lender estimates will be payable for the renewal of the coverage afforded
by the Policies upon the expiration thereof in order to accumulate sufficient
funds to pay all such Insurance Premiums at least thirty (30) days prior
to the
expiration of the Policies. Amounts deposited pursuant to this
Section 6.3.1 are referred to herein as the “Insurance
Funds”. If at any time Lender reasonably determines that
the Insurance Funds will not be sufficient to pay the Insurance Premiums,
Lender
shall notify Borrower of such determination and the monthly deposits for
Insurance Premiums shall be increased by the amount that Lender estimates
is
sufficient to make up the deficiency at least thirty (30) days prior to
expiration of the Policies. Lender shall cause the Insurance Funds to
be deposited with Agent for credit to the “Insurance Account” established under
the Cash Management Agreement within five (5) Business Days following the
Closing Date.
6.3.2 Release
of Insurance Funds. Provided no Event of Default shall
exist and remain uncured, Lender shall apply the Insurance Funds to payment
of
Insurance Premiums. In making any payment relating to Insurance
Premiums, Lender may do so according to any xxxx, statement or estimate procured
from the insurer or its agent, without inquiry into the accuracy of such
xxxx,
statement or estimate. If the amount of the Insurance Funds shall
exceed the amounts due for Insurance Premiums, Lender shall, in its sole
discretion, return any excess to Borrower or credit such excess against future
payments to be made to the Insurance Funds. Any Insurance Funds
remaining after the Debt has been paid in full shall be returned to
Borrower.
6.3.3 Blanket
Insurance and Premium Financing. For so long as a
Blanket Insurance Premium Financing Arrangement (as hereafter defined) remains
in effect, in lieu of the amount of the Insurance Premiums to be paid by
Borrower to Lender pursuant to Section 6.3.1 hereof, Borrower shall pay
to Lender the Financing Installment (as hereafter defined). As used
herein, the term “Blanket Insurance Premium Financing
Arrangement” means the arrangement with one or more finance
companies for the financing of certain blanket insurance policies maintained
by
Borrower under the Property Insurance Sharing Agreement. Each Fiscal
Year, Borrower pays to such finance companies Borrower’s allocable share of the
annual initial deposit (the “Deposit”) and Borrower’s
allocable share of ten (10) regular monthly payments (the “Regular
Payments”) due for each blanket Policy. The term
“Financing Installment” as
77
used
herein means 1/12 of the aggregate of the Deposit and the Regular Payments
for
each annual period, as such amounts may be adjusted as hereinafter set
forth. On the first Monthly Payment Date and on each Monthly Payment
Date in calendar year 2007, the Financing Installment shall be in the applicable
amount shown on Schedule II attached hereto. Not less than
twenty (20) days prior to each renewal date of each blanket policy, Borrower
shall provide Lender in writing the estimated premium for such blanket policy
for the following renewal period, and not less than ten (10) days after the
renewal date, Borrower will provide Lender in writing the actual amount of
such
premium. Borrower will also notify Lender in writing within ten (10)
days after any change in the amounts allocated to the Property under the
Blanket
Insurance Premium Financing Arrangement or any other charge in premiums or
amounts due from Borrower under the Blanket Insurance Premium Financing
Arrangement. Thereafter, the Financing Installment shall be adjusted
as reasonably determined by Lender. In the event of any material
change in the Blanket Insurance Premium Financing Arrangement, the foregoing
provisions shall be modified as reasonably determined by Lender in order
to
carry out the intent and purposes hereof. The term
“Insurance Premiums”, for the purposes of this
Agreement, shall include any Deposits, any Regular Payments and any Financing
Installments required to be paid by Borrower under any Blanket Insurance
Premium
Financing Arrangement, including, without limitation, the Property Insurance
Sharing Agreement. Notwithstanding the foregoing, Borrower covenants
and agrees that the finance company (or finance companies) entering into
the
Blanket Insurance Premium Financing Arrangement shall have no collateral
from
Borrower for Borrower’s obligations under such arrangement other than Borrower’s
interest in any unearned Insurance Premiums and shall not have the ability
to
terminate or compel Borrower to terminate an insurance policy the premiums
for
which have been financed through the Blanket Insurance Premium Financing
Arrangement without Borrower first having in place a replacement insurance
policy in accordance with the terms of this Agreement.
Section
6.4. Capital
Expenditure Funds.
6.4.1 Deposits
of Capital Expenditure Funds. Borrower shall deposit to
the Capital Expenditure Account established under the Cash Management Agreement
on each Monthly Payment Date, an amount equal to Fourteen Thousand Four Hundred
Eighty-Seven and 69/100 Dollars ($14,487.69) for annual Capital Expenditures
payable to Persons unaffiliated with Borrower approved by Lender, which approval
shall not be unreasonably withheld or delayed. Amounts deposited
pursuant to this Section 6.4.1 are referred to herein as the
“Capital Expenditure Funds.” Lender may
reassess its estimate of the amount necessary for capital expenditures from
time
to time and, and may require Borrower to increase the monthly deposits required
pursuant to this Section 6.4.1 upon thirty (30) days notice to
Borrower if Lender determines in its reasonable discretion that an increase
is
necessary to maintain proper operation of the Property.
6.4.2 Release
of Capital Expenditure Funds.
(a) Lender
shall disburse, or caused to be disbursed, Capital Expenditure Funds only
for
Capital Expenditures.
(b) Lender
shall disburse, or caused to be disbursed, to Borrower the Capital Expenditure
Funds (but in no event more frequently than once each calendar month and
78
subject
to the conditions set forth in this Section 6.4.2) upon satisfaction by Borrower
of each of the following conditions: (i) Borrower shall submit a
request for payment to Lender at least ten (10) days prior to the date on
which
Borrower requests such payment be made and specifies the Capital Expenditures
to
be paid, (ii) on the date such request is received by Lender and on the
date such payment is to be made, no Event of Default shall exist and remain
uncured, (iii) Lender shall have received a certificate from Borrower
(A) stating that the items to be funded by the requested disbursement are
Capital Expenditures payable to Persons unaffiliated with Borrower,
(B) stating that all Capital Expenditures at the Property to be funded by
the requested disbursement have been completed in a good and workmanlike
manner
and in accordance with all applicable Legal Requirements, such certificate
to be
accompanied by a copy of any license, permit or other approval required by
any
Governmental Authority in connection with the Capital Expenditures,
(C) identifying each Person that supplied materials or labor in connection
with the Capital Expenditures to be funded by the requested disbursement,
and
(D) stating that each such Person has been paid in full or will be paid in
full upon such disbursement, such certificate to be accompanied by lien waivers
or other evidence of payment satisfactory to Lender, (iv) at Lender’s
option, a title search for the Property indicating that the Property is free
from all Liens, claims and other encumbrances not previously approved by
Lender,
(v) at Lender’s option, if the cost of any individual Capital Expenditure
exceeds Fifty Thousand and No/100 Dollars ($50,000.00), Lender shall have
received a report satisfactory to Lender in its reasonable discretion from
an
architect or engineer approved by Lender in respect of such architect or
engineer’s inspection of the required repairs, and (vi) Lender shall have
received such other evidence as Lender shall reasonably request that the
Capital
Expenditures at the Property to be funded by the requested disbursement have
been completed and are paid for or will be paid upon such disbursement to
Borrower. Lender shall not be required to disburse Capital
Expenditure Funds more frequently than once each calendar month, and each
disbursement must be at least an amount greater than the Minimum Disbursement
Amount (or a lesser amount if the total amount of Capital Expenditure Funds
is
less than the Minimum Disbursement Amount, in which case only one disbursement
of the amount remaining in the account shall be made).
(c) Nothing
in this Section 6.4.2 shall (i) make Lender responsible for
making or completing the Capital Expenditures Work; (ii) require Lender to
expend funds in addition to the Capital Expenditure Funds to complete any
Capital Expenditures Work; (iii) obligate Lender to proceed with the
Capital Expenditures Work; or (iv) obligate Lender to demand from Borrower
additional sums to complete any Capital Expenditures Work.
(d) Borrower
shall permit Lender and Lender’s agents and representatives (including, without
limitation, Lender’s engineer, architect, or inspector) or third parties to
enter onto the Property during normal business hours (subject to the rights
of
Tenants under their Leases) to inspect the progress of any Capital Expenditures
Work and all materials being used in connection therewith and to examine
all
plans and shop drawings relating to such Capital Expenditures
Work. Borrower shall cause all contractors and subcontractors to
cooperate with Lender or Lender’s representatives or such other Persons
described above in connection with inspections described in this
Section 6.4.2(d).
(e) If
a Capital Expenditure disbursement will exceed Fifty Thousand and No/100
Dollars
($50,000.00), Lender may require an inspection of the Property at Borrower’s
expense prior to making a disbursement of Capital Expenditure Funds in order
to
79
verify
completion of the Capital Expenditures Work for which reimbursement is
sought. Lender may require that such inspection be conducted by an
appropriate independent qualified professional selected by Lender and may
require a certificate of completion by an independent qualified professional
architect acceptable to Lender prior to the disbursement of Capital Expenditure
Funds. Borrower shall pay the expense of the inspection as required
hereunder, whether such inspection is conducted by Lender or by an independent
qualified professional architect.
(f) In
addition to any insurance required under the Loan Documents, Borrower shall
provide or cause to be provided workmen’s compensation insurance, builder’s
risk, and public liability insurance and other insurance to the extent required
under applicable law in connection with Capital Expenditures Work.All such
policies shall be in form and amount reasonably satisfactory to
Lender.
Section
6.5. Rollover
Funds.
6.5.1 Deposits
of Rollover Funds. While a Cash Trap Period exists,
there shall be deposited to the Rollover Account established under the Cash
Management Agreement on each Monthly Payment Date the sum of One Hundred
Thousand and No/100 Dollars ($100,000.00), for tenant improvements and leasing
commissions, lease cancellation fees, buy-out fees or a similar cost payable
to
Persons unaffiliated with Borrower that may be incurred while such Cash Trap
Period exists. Amounts deposited pursuant to this Section
6.5.1 are referred to herein as the “Rollover
Funds.”
6.5.2 Release
of Rollover Funds. Lender shall disburse, or caused to
be disbursed, to Borrower the Rollover Funds upon satisfaction by Borrower
of
each of the following conditions: (a) Borrower shall submit a
request for payment to Lender at least ten (10) days prior to the date on
which
Borrower requests such payment be made and specifies the tenant improvement
costs and leasing commissions to be paid, (b) on the date such request is
received by Lender and on the date such payment is to be made, no Event of
Default shall exist and remain uncured, (c) Lender shall have reviewed and
approved the Lease in respect of which Borrower is obligated to pay or reimburse
certain tenant improvement costs and leasing commissions, (d) Lender shall
have received and approved a budget for tenant improvement costs and a schedule
of leasing commissions payments and the requested disbursement will be used
to
pay all or a portion of such costs and payments, (e) Lender shall have
received a certificate from Borrower (i) stating that all tenant
improvements at the Property to be funded by the requested disbursement are
payable to Persons unaffiliated with Borrower and have been completed in
good
and workmanlike manner and in accordance with all applicable federal, state
and
local laws, rules and regulations, such certificate to be accompanied by
a copy
of any license, permit or other approval by any Governmental Authority required
in connection with such tenant improvements, (ii) identifying each Person
that supplied materials or labor in connection with the tenant improvements
to
be funded by the requested disbursement, and (iii) stating that each such
Person has been paid in full or will be paid in full upon such disbursement,
such certificate to be accompanied by lien waivers or other evidence of payment
satisfactory to Lender, (f) at Lender’s option, a title search for the
Property indicating that the Property is free from all Liens, claims and
other
encumbrances not previously approved by Lender, (g) Lender shall have received
an estoppel certificate from the applicable tenant stating
80
that
(i)
all required work is complete and (ii) such tenant is in occupancy and paying
full unabated rent or has taken possession of the demised premises, and
(h) Lender shall have received such other evidence as Lender shall
reasonably request that the tenant improvements at the Property to be funded
by
the requested disbursement have been completed and are paid for or will be
paid
upon such disbursement to Borrower. Lender shall not be required to
disburse Rollover Funds more frequently than once each calendar month, and
each
disbursement must be in an amount greater than the Minimum Disbursement Amount
(or a lesser amount if the total amount of Rollover Funds is less than the
Minimum Disbursement Amount, in which case only one disbursement of the amount
remaining in the account shall be made).
Section
6.6. Existing
Tenant Improvement Funds.
6.6.1 Deposits
of Existing Tenant Improvement Funds. On the Closing
Date, Borrower shall deposit with Lender the amount of Eight Hundred Nine
Thousand Nine Hundred and No/100 Dollars ($809,900.00) (the “Existing
Tenant Improvement Funds”) representing the amounts not yet
disbursed by Borrower on account of tenant improvement allowances under Leases
(other than the Xxxxxx & Xxxxxxx Lease) in effect on the date hereof and
payable to Persons unaffiliated with Borrower. Lender shall
cause the Existing Tenant Improvement Funds to be deposited with Agent for
credit to the “Existing Tenant Improvement Funds Account” established under the
Cash Management Agreement within five (5) Business Days following the Closing
Date.
6.6.2 Release
of Existing Tenant Improvement Funds. Lender shall disburse, or
caused to be disbursed, to Borrower the Existing Tenant Improvement Funds
upon
satisfaction by Borrower of each of the following
conditions: (a) Borrower shall submit a request for payment to
Lender at least ten (10) days prior to the date on which Borrower requests
such
payment be made and specifies the tenant improvement costs to be paid,
(b) on the date such request is received by Lender and on the date such
payment is to be made, no Event of Default shall exist and remain uncured,
(c) Lender shall have reviewed and approved the Lease in respect of which
Borrower is obligated to pay or reimburse certain tenant improvement costs,
(d)
to the extent required to be delivered by the tenant under the applicable
lease
to Borrower, Lender shall have received and approved a budget for tenant
improvement costs and the requested disbursement will be used to pay all
or a
portion of such costs and payments, (e) Lender shall have received a
certificate from Borrower (i) stating that all tenant improvements at the
Property to be funded by the requested disbursement are payable to Persons
unaffiliated with Borrower and have been completed in good and workmanlike
manner and in accordance with all applicable federal, state and local laws,
rules and regulations, such certificate to be accompanied by a copy of any
license, permit or other approval by any Governmental Authority required
in
connection with such tenant improvements to the extent such license, permit
or
approval is required to be delivered by the tenant under the applicable lease
to
Borrower, (ii) identifying each Person that supplied materials or labor in
connection with the tenant improvements to be funded by the requested
disbursement to the extent such information is required to be delivered by
the
tenant under the applicable lease to Borrower, and (iii) stating that each
such Person has been paid in full or will be paid in full upon such
disbursement, such certificate to be accompanied by lien waivers or other
evidence of payment satisfactory to Lender to the extent such waivers or
other
evidence of payment are required to be delivered by the tenant under the
applicable lease to Borrower, (f) at Lender’s option, a title search for
the Property indicating that the Property is free
81
from
all
Liens, claims and other encumbrances not previously approved by Lender, (g)
to
the extent required to be delivered by the tenant under the applicable lease
to
Borrower, Lender shall have received an estoppel certificate from the applicable
tenant stating that (i) all required work is complete and (ii) such tenant
is in
occupancy and paying full unabated rent or has taken possession of the demised
premises, and (h) Lender shall have received such other evidence as Lender
shall reasonably request and as shall be required to be delivered pursuant
to
the applicable lease that the tenant improvements at the Property to be funded
by the requested disbursement have been completed and are paid for or will
be
paid upon such disbursement to Borrower. Lender shall not be required
to disburse Tenant Improvement Funds more frequently than once each calendar
month, and each disbursement must be in an amount greater than the Minimum
Disbursement Amount (or a lesser amount if the total amount of Tenant
Improvement Funds is less than the Minimum Disbursement Amount, in which
case
only one disbursement of the amount remaining in the account shall be
made).
Section
6.7. Xxxxxx
Landlord Work Funds.
6.7.1 Deposits
of Xxxxxx Landlord Work Funds. On the Closing Date,
Borrower shall deposit with Lender the amount of Eight Million and No/100
Dollars ($8,000,000.00) (the “Xxxxxx Landlord Work
Funds”) representing the amounts not yet disbursed by Borrower on
account of the anticipated costs to be incurred by Borrower under the Xxxxxx
& Xxxxxxx Lease with respect to the construction work required to be
undertaken by Borrower thereunder and payable to Persons unaffiliated with
Borrower (the “Xxxxxx Landlord Work”). Lender
shall cause the Xxxxxx Landlord Work Funds to be deposited with Agent for
credit
to the “Xxxxxx Landlord Work Funds Account” established under the Cash
Management Agreement within five (5) Business Days following the Closing
Date.
6.7.2 Budget,
Schedule and Completion Obligations with respect to the Xxxxxx Landlord
Work. On or before September 28, 2007, Borrower shall
deliver to Lender a budget for the hard and soft costs anticipated to be
incurred in connection with the Xxxxxx Landlord Work (the “Xxxxxx
Landlord Work Budget”), a construction schedule for the performance
of the Xxxxxx Landlord Work, and such plans and specifications for the Xxxxxx
Landlord Work as have then been developed pursuant to the Xxxxxx & Xxxxxxx
Lease. The Xxxxxx Landlord Work Budget and such schedule shall be
consistent with the obligations of Borrower under the Xxxxxx & Xxxxxxx
Lease. Borrower shall cause the Xxxxxx Landlord Work to be completed
in accordance with the Xxxxxx & Xxxxxxx Lease, free and clear of Liens and
in compliance with all Legal Requirements. Until such time as the
Xxxxxx Landlord Work is completed, Borrower shall deliver to Lender, within
thirty (30) days after the end of each month, a certificate of an authorized
officer of Borrower, in form and substance reasonably satisfactory to Lender,
setting forth in reasonable detail (a) a reconciliation of the actual costs
incurred to date (and projected costs to be incurred) with respect to the
Xxxxxx
Landlord Work to the Xxxxxx Landlord Work Budget, (b) a description of the
status of the Xxxxxx Landlord Work and a reconciliation of the progress of
the
Xxxxxx Landlord Work to date to the construction schedule for the Xxxxxx
Landlord Work, and (c) if the Xxxxxx Landlord Work is not proceeding in
accordance with the Xxxxxx Landlord Work Budget or construction schedule,
a
description of the actions that Borrower is taking or will be taking in order
to
cause the progress of the Xxxxxx Landlord Work to be completed in accordance
with the Xxxxxx Landlord Work Budget and construction schedule. If at
any time the remaining costs to be paid or estimated to be incurred
82
in
connection with the completion of the Xxxxxx Landlord Work (as reasonably
determined by Lender) exceed the balance of the Xxxxxx Landlord Work Funds
then
held in the Xxxxxx Landlord Work Funds Account, then Borrower shall deliver
to
Lender, within five (5) Business Days after written demand by Lender, such
additional funds for deposit in the Xxxxxx Landlord Funds Account as may
be
required so that the balance held therein is not less than the remaining
amount
to be paid or estimated to be incurred in connection with the completion
of the
Xxxxxx Landlord Work (as determined by Lender). Borrower shall obtain
Lender’s prior written consent to any modification to the Xxxxxx Landlord Work
Budget or schedule that would cause the Xxxxxx Landlord Budget or schedule
not
to be in compliance with the Xxxxxx & Xxxxxxx Lease.
6.7.3 Release
of Xxxxxx Landlord Work Funds. Lender shall disburse, or caused to
be disbursed, to Borrower from time to time the Xxxxxx Landlord Work Funds
upon
satisfaction by Borrower of each of the following conditions:
(a) Borrower
shall submit a request for disbursement to Lender at least ten (10) days
prior
to the date on which Borrower requests such disbursement be made, which
disbursement request shall specify the costs relating to the Xxxxxx Landlord
Work to be paid from such disbursement,
(b) on
the date such request is received by Lender and on the date such disbursement
is
to be made, no Event of Default shall exist and remain uncured, and the
representations and warranties made by Borrower in this Agreement and in
the
other Loan Documents shall be true and correct in all material respects on
and
as of the date of the making of such disbursement with the same force and
effect
as if made on and as of such date,
(c) after
giving effect to such disbursement, the amount of the Xxxxxx Landlord Work
Funds
held in the Xxxxxx Landlord Work Funds Account will be equal to or greater
than
the remaining costs to be paid or estimated to be incurred in connection
with
the completion of the Xxxxxx Landlord Work, as determined by
Lender,
(d) Lender
shall have received such certificates and affidavits as to such matters as
Lender may reasonably request, including, without limitation, certificates
of an
approved architect or engineer, or, if Borrower fails to have such architect
or
engineer deliver such certificate or affidavit, of a construction consultant
retained by Lender at Borrower’s expense in connection with any work,
(i) stating that the items to be funded by the requested disbursements are
an aspect of the Xxxxxx Landlord Work as set forth on the Xxxxxx Landlord
Work
Budget and plans and specifications therefor, (ii) stating that the costs
for all Xxxxxx Landlord Work to be funded by the requested disbursement are
payable to Persons unaffiliated with Borrower and that such Xxxxxx Landlord
Work
has been completed in a good and workmanlike manner, in compliance with the
Xxxxxx & Xxxxxxx Lease and all applicable Legal Requirements, such
certificate to be accompanied by a copy of any applicable license, permit
or
other approval required by any Governmental Authority in connection with
such
Xxxxxx Landlord Work not previously provided to Lender, (iii) identifying
each Person that supplied materials or labor in connection with such Xxxxxx
Landlord Work to be funded by the requested disbursement (together with any
invoices and other back-up evidencing the incurrence thereof), (iv) stating
that each such Person has been paid in full or will be paid in full upon
such
disbursement for all amounts then owed to such Person for such work, such
certificate to be
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accompanied
by the items described in clauses (g) and (h) below, (v) stating
that the amount of the Xxxxxx Landlord Work Funds remaining unfunded after
such
disbursement will be sufficient on completion of such construction to pay
for
the unpaid costs required to complete the remaining Xxxxxx Landlord Work
(as
estimated by the certifying party), and (vi) at Lender’s option, if the
amount of the requested disbursement exceeds Five Hundred Thousand and No/100
Dollars ($500,000.00), a title search for the Property indicating that the
Property is free from all Liens, claims and other encumbrances not previously
approved by Lender,
(e) at
Lender’s option, if the cost of any individual item of Xxxxxx Landlord Work
exceeds One Million and No/100 Dollars ($1,000,000.00), Lender shall have
received a report satisfactory to Lender in its reasonable discretion from
an
architect or engineer approved by Lender in respect of such architect or
engineer’s inspection of such Xxxxxx Landlord Work,
(f) Lender
shall have received contractors’ waivers or releases of lien for the work
covered by the disbursement request, in form and substance reasonably
satisfactory to Lender,
(g) Lender
shall have received such other evidence as Lender shall reasonably request
that
the portion of the Xxxxxx Landlord Work to be funded by the requested
disbursement has been completed and has been paid for or will be paid upon
such
disbursement to Borrower, and
(h) notwithstanding
the foregoing, Lender shall have the right to retain an amount equal to ten
percent (10%) of the amount of any disbursement request pending the completion
of all Xxxxxx Landlord Work and the receipt by Lender of an estoppel certificate
from Xxxxxx & Xxxxxxx which confirms that (i) all Xxxxxx Landlord Work is
complete and (ii) there is no default on the part of Borrower under the Xxxxxx
& Xxxxxxx Lease.
Notwithstanding
anything to the contrary contained in this Section 6.7.3, Lender shall
not be required to disburse Xxxxxx Landlord Work Funds more frequently than
once
each calendar month, and must be an amount equal to or greater than the Minimum
Disbursement Amount (or a lesser amount if necessary to fully pay, or pay
the
final installment of, a cost attributable to such work, in which case such
lesser disbursement shall be made, or if the total amount of Xxxxxx Landlord
Work Funds is less than the Minimum Disbursement Amount, in which case only
one
disbursement of the amount remaining in the account shall be
made). Provided no Event of Default shall have occurred and be
continuing, upon completion of, and final payment for, the Xxxxxx Landlord
Work
in accordance with this Section 6.7, any remaining Xxxxxx Landlord Work
Funds shall be released to Borrower upon written request. So long as
no Event of Default exists and Borrower is in compliance with its obligations
in
Section 6.7.2, in the event a line item set forth on the Xxxxxx Landlord
Work Budget is completed in a good and workmanlike manner and otherwise in
accordance with the terms and conditions of this Section 6.7, and all
such funds allocated to such line item on the Xxxxxx Landlord Work Budget
have
not been utilized in connection with the same, Borrower may reallocate such
funds to another line item upon written notice to Lender. So long as
no Event of Default exists and Borrower is in compliance with its obligations
in
Section 6.7.2, if Borrower demonstrates to Lender that the cost of
completing a line item has decreased from the amount set forth in the budget
for
such line
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item,
then Borrower may also reallocate such cost savings to contingency or to
another
line item with Lender’s prior written approval. So long as no Event
of Default exists and Borrower is in compliance with its obligations in
Section 6.7.2, Borrower may request disbursement, and Lender shall
disburse, from contingency to pay costs of the Xxxxxx Landlord Work, provided
that the amount remaining in the contingency line item following such
disbursement is an adequate contingency line item, as determined by Lender
in
its reasonable discretion, for the remaining Xxxxxx Landlord Work.
Nothing
in this Section 6.7 shall (i) make Lender responsible for making or
completing the Xxxxxx Landlord Work; (ii) require Lender to expend funds in
addition to the Xxxxxx Landlord Work Funds to complete any Xxxxxx Landlord
Work;
(iii) obligate Lender to proceed with the Xxxxxx Landlord Work; or
(iv) obligate Lender to demand from Borrower additional sums to complete
any Xxxxxx Landlord Work.
Borrower
shall permit Lender and Lender’s agents and representatives (including, without
limitation, Lender’s engineer, architect, or inspector) or third parties to
enter onto the Property during normal business hours (subject to the rights
of
Tenants under their Leases) to inspect the progress of any Xxxxxx Landlord
Work
and all materials being used in connection therewith and to examine all plans
and shop drawings relating to such Xxxxxx Landlord Work. Borrower
shall cause all contractors and subcontractors to cooperate with Lender or
Lender’s representatives or such other Persons described above in connection
with inspections described in this Section 6.7.3.
If
a
disbursement of the Xxxxxx Landlord Work Funds will exceed Five Hundred Thousand
and No/100 Dollars ($500,000.00), Lender may require an inspection of the
Property at Borrower’s expense prior to making a disbursement of Xxxxxx Landlord
Work Funds in order to verify completion of the Xxxxxx Landlord Work for
which
reimbursement is sought. Lender may require that such inspection be
conducted by an appropriate independent qualified professional selected by
Lender and may require a certificate of completion by an independent qualified
professional architect acceptable to Lender prior to the disbursement of
Xxxxxx
Landlord Work Funds. Borrower shall pay the expense of the inspection
as required hereunder, whether such inspection is conducted by Lender or
by an
independent qualified professional architect.
In
addition to any insurance required under the Loan Documents, Borrower shall
provide or cause to be provided workmen’s compensation insurance, builder’s
risk, and public liability insurance and other insurance to the extent required
under applicable law in connection with the Xxxxxx Landlord Work. All
such policies shall be in form and amount reasonably satisfactory to
Lender.
Borrower
hereby consents to any disbursement of the Xxxxxx Landlord Work Funds to
Guarantor in accordance with the terms of the Recourse Guarantee.
Section
6.8. Security
Interest in Reserve Funds.
6.8.1 Grant
of Security Interest. Borrower hereby pledges to Lender,
and grants to Lender a security interest in, any and all monies now or hereafter
deposited in the
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Reserve
Funds as additional security for the payment of the Loan. The Reserve Funds
shall be held in Lender’s name and may be commingled with Lender’s own funds at
financial institutions selected by Lender in its sole
discretion. Upon the occurrence of an Event of Default, Lender may
apply any sums then present in the Reserve Funds to the payment of the Loan
in
any order in its sole discretion. Until expended or applied as above
provided, the Reserve Funds shall constitute additional security for the
Loan. Lender shall have no obligation to release any of the Reserve
Funds while any Event of Default or Default then exists.
6.8.2 Income. All
interest on the Reserve Funds shall accrue for the benefit of Borrower, shall
be
credited to such Reserve Funds and shall be subject to Lender’s security
interest in and to the Reserve Funds. The Reserve Funds shall bear
interest at the customary market rate offered by Lender for escrow deposits
of
this nature, and shall be held and released by Lender, and used by Borrower,
in
accordance with the terms and conditions of this Agreement. Borrower
shall report on its federal, state and local income tax returns all interest
or
income earned by Borrower on the applicable Reserve Funds.
6.8.3 Prohibition
Against Further Encumbrance. Borrower shall not, without
the prior consent of Lender, further pledge, assign or grant any security
interest in the Reserve Funds or permit any lien or encumbrance to attach
thereto, or any levy to be made thereon, or any UCC-1 Financing Statements,
except those naming Lender as the secured party, to be filed with respect
thereto.
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VII.
|
PROPERTY
MANAGEMENT
|
Section
7.1. The
Management Agreement.
Borrower
shall cause Manager to manage the Property in accordance with the Management
Agreement. Borrower shall (a) diligently perform and observe in
all material respects all of the material terms, covenants and conditions
of the
Management Agreement on the part of Borrower to be performed and observed,
(b) promptly notify Lender of any notice to Borrower of any default by
Borrower in the performance or observance of any of the terms, covenants
or
conditions of the Management Agreement on the part of Borrower to be performed
and observed, and (c) promptly deliver to Lender a copy of each periodic
report received by Borrower under the Management Agreement and, promptly
upon
request, deliver to Lender a copy of any other financial statement, business
plan, capital expenditures plan, report and estimate received by it under
the
Management Agreement. If Borrower shall default in the performance or
observance of any material term, covenant or condition of the Management
Agreement on the part of Borrower to be performed or observed, then, without
limiting Lender’s other rights or remedies under this Agreement or the other
Loan Documents, and without waiving or releasing Borrower from any of its
obligations hereunder or under the Management Agreement, Lender shall have
the
right, but shall be under no obligation, to pay any sums and to perform any
act
as may be appropriate to cause all the material terms, covenants and conditions
of the Management Agreement on the part of Borrower to be performed or
observed. Manager shall be entitled to receive a fee of no more than
3.00% of “Project Income” (as defined in the Management Agreement) as in effect
on the date hereof.
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Borrower
shall not surrender, terminate, cancel, modify, renew, amend, or extend the
Management Agreement, or enter into any other agreement relating to the
management or operation of the Property with Manager or any other Person,
or
consent to the assignment by the Manager of its interest under the Management
Agreement, in each case without the express written consent of Lender, which
consent shall not be unreasonably withheld; provided, however, with respect
to a
new manager such consent may be conditioned upon Borrower delivering a Rating
Agency Confirmation as to such new manager and management agreement and,
if such
new manager is an Affiliate of Borrower, upon delivery of a non-consolidation
opinion acceptable to the Rating Agencies; provided further,
however, that if Borrower satisfies the foregoing conditions, Lender
shall not withhold its consent to the appointment of a replacement manager
that
is an Affiliate of Borrower. Lender shall reasonably cooperate with
Borrower, at no cost or expense to Lender, in seeking to obtain a Rating
Agency
Confirmation from the Rating Agencies for such actions upon the request of
Borrower. If at any time Lender consents to the
appointment of a new manager, such new manager and Borrower shall, as a
condition of Lender’s consent, execute a subordination of management agreement
in the form then used by Lender. Borrower shall have the right to amend the
Property Management Agreement from time to time in order to comply with
applicable Legal Requirements including, without limitation, tax laws pertaining
to REIT’s or Guarantor’s status as a real estate investment trust or subsidiary
thereof.
Section
7.3. Replacement
of Manager.
Lender
shall have the right to require Borrower to replace the Manager with a Person
which is not an Affiliate of, but is chosen by, Borrower and approved by
Lender
upon the occurrence of any one or more of the following
events: (a) at any time following the occurrence of an Event of
Default, (b) if Manager shall be in default under the Management Agreement
beyond any applicable notice and cure period or if at any time the Manager
has
engaged in gross negligence, fraud or willful misconduct, and/or (c) Manager
becomes insolvent or the subject of any proceeding under the Bankruptcy
Code.
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VIII.
|
TRANSFERS
|
Section
8.1. Transfer
or Encumbrance of Property.
(a) Borrower
shall not cause or permit a Sale or Pledge of the Property or any part thereof
or any legal or beneficial interest therein nor permit a Sale or Pledge of
an
interest in any Restricted Party or any Change of Control (in each case,
a
“Prohibited Transfer”), other than pursuant to Leases of
space in the Improvements to Tenants in accordance with the provisions of
Section 4.1.9, without the prior written consent of Lender.
(b) A
Prohibited Transfer shall include, but not be limited to, (i) an installment
sales agreement wherein Borrower agrees to sell the Property or any part
thereof
for a price to be paid in installments; (ii) an agreement by Borrower leasing
all or a substantial part of the Property for other than actual occupancy
by a
space tenant thereunder or a sale, assignment or other transfer of, or the
grant
of a security interest in, Borrower’s right, title and
87
interest
in and to any Leases or any Rents; (iii) if a Restricted Party is a corporation,
any merger, consolidation or Sale or Pledge of such corporation’s stock or the
creation or issuance of new stock in one or a series of transactions; (iv)
if a
Restricted Party is a limited or general partnership or joint venture, any
merger or consolidation or the change, removal, resignation or addition of
a
general partner or the Sale or Pledge of the partnership interest of any
general
or limited partner or any profits or proceeds relating to such partnership
interests or the creation or issuance of new partnership interests; (v) if
a
Restricted Party is a limited liability company, any merger or consolidation
or
the change, removal, resignation or addition of a managing member or non-member
manager (or if no managing member, any member) or the Sale or Pledge of the
membership interest of any member or any profits or proceeds relating to
such
membership interest or the creation or issuance of new membership interests;
(vi) if a Restricted Party is a trust or nominee trust, any merger,
consolidation or the Sale or Pledge of the legal or beneficial interest in
a
Restricted Party or the creation or issuance of new legal or beneficial
interests; or (vii) the removal or the resignation of the Manager (including,
without limitation, an Affiliated Manager) other than in accordance with
Article
VII.
(c) Notwithstanding
the provisions of Section 8.1(b), the following transfers shall not be
deemed to be a Prohibited Transfer: (a) a transfer by devise or descent or
by
operation of law upon the death of a member, partner or shareholder of a
Restricted Party; (b) the Sale or Pledge, in one or a series of transactions,
of
not more than forty-nine percent (49%) of the stock, limited partnership
interests or non-managing membership interests (as the case may be) in a
Restricted Party; provided, however, no such transfers shall result in a
change
in Control in the Restricted Party, a change in control of the Property or
a
Change in Control; no transfer shall be made to any Prohibited Person; as
a
condition to each such transfer, Lender shall receive not less than thirty
(30)
days prior written notice of such proposed transfer; and, if Borrower is
a
single member limited liability company on the date of this Agreement, no
such
transfer shall consist of the transfer of any interest in or admission of
any
person as a member in Borrower; (c) a transfer by Guarantor or REIT of a
portion
of its direct or indirect ownership interests in Borrower to an Approved
Transferee, so long as (i) at the time of such transfer there exist no monetary
defaults or Events of Default under the Loan Documents, (ii) at all times
following such transfer, Guarantor or REIT owns at least twenty percent (20%)
of
the direct or indirect ownership interests in Borrower, (iii) at all times
following such transfer, Guarantor or REIT continues to Control Borrower
and
there is no Change of Control of Guarantor or REIT, and (v) at all times
following such transfer Guarantor or REIT or an Affiliate thereof is Manager;
or
(d) a Permitted Mezzanine Loan Lien in accordance with the provisions of
Section 8.1(i). Notwithstanding the foregoing, Sponsor may
pledge its direct or indirect ownership interests in Borrower as security
for
Sponsor’s obligations under its primary credit facility; provided that (i) such
pledge shall not be subject to foreclosure, nor shall there be any conveyance
in
lieu thereof, nor shall there be any other action in respect of such pledged
interests inconsistent with the consent and acknowledgement referred to in
clause (iii) below, without Lender’s prior written consent; (ii) such
pledge, by its express terms, shall be subject to the limitations on foreclosure
and conveyance in lieu thereof set forth above; and (iii) the pledgee shall
deliver such acknowledgments of and consents to the foregoing as Lender may
request. Without limiting the foregoing, if Lender exercises the
Mezzanine Option, the pledgee shall release its pledge on any of the ownership
interest that form the collateral for the Mezzanine Loan (without limiting
the
rights of Sponsor, in accordance with this Section 8.1.3, to pledge to such
pledgee other indirect ownership interests in Borrower that do not form the
collateral for the Mezzanine Loan).
88
(d) Lender
reserves the right to condition the consent to a Prohibited Transfer requested
hereunder upon (a) a modification of the terms hereof and on assumption of
the
Notes and the other Loan Documents as so modified by the proposed Prohibited
Transfer, (b) receipt of payment of a transfer fee equal to one–half of one
percent (0.50%) of the outstanding principal balance of the Loan and all
of
Lender’s expenses incurred in connection with such Prohibited Transfer, (c)
receipt of Rating Agency Confirmation with respect to the transfer, (d) the
proposed transferee’s continued compliance with the covenants set forth in this
Agreement (including, without limitation, the covenants in Section
3.1.24) and the other Loan Documents, (e) a new manager for the Property and
a new management agreement satisfactory to Lender, (f) a new guaranty(ies)
and
environmental indemnity, substantially in the form of the Guarantee and
Environmental Indemnity delivered contemporaneously with this Agreement,
from
guarantor(s) and indemnitor(s) satisfactory to Lender, and (g) the satisfaction
of such other conditions and/or legal opinions as Lender shall determine
in its
sole discretion to be in the interest of Lender. All expenses
incurred by Lender shall be payable by Borrower whether or not Lender consents
to the Prohibited Transfer. Lender shall not be required to
demonstrate any actual impairment of its security or any increased risk of
default hereunder in order to declare the Debt immediately due and payable
upon
a Prohibited Transfer made without Lender’s consent. This provision shall apply
to each and every Prohibited Transfer, whether or not Lender has consented
to
any previous Prohibited Transfer. Notwithstanding anything to the
contrary contained in this Section 8.1(d), in the event a substantive
non-consolidation opinion was delivered to Lender and the Rating Agencies
in
connection with the closing of the Loan, and if any Prohibited Transfer results
in any Person and its Affiliates owning in excess of forty-nine percent (49%)
of
the ownership interests in a Restricted Party, Borrower shall, prior to such
transfer, and in addition to any other requirement for Lender consent contained
herein, deliver a revised substantive non-consolidation opinion to Lender
reflecting such Prohibited Transfer, which opinion shall be in form, scope
and
substance acceptable in all respects to Lender and the Rating
Agencies.
(e) Notwithstanding
anything to the contrary set forth in this Section 8.1, the transfers restricted
hereunder shall not include (i) any conveyance, assignment, sale, mortgaging,
encumbrance, pledging, hypothecation, granting of a security interest in,
granting of options with respect to, or other disposition (including in
connection with any merger or consolidation) of any limited partnership
interests in Guarantor (provided that after giving effect thereto REIT continues
to Control Guarantor), or of any publicly traded stock in REIT, (ii) the
conveyance, assignment, sale, pledge, hypothecation, granting of a security
interest in, granting of options with respect to, or other disposition of
stock
in REIT, provided that, in the case of either clause (i) or clause (ii) above,
(A) after giving effect to any such conveyance, assignment, sale or other
disposition, the common stock of REIT shall be listed and traded on the New
York
Stock Exchange or other nationally recognized stock exchange and (B) in the
event that more than forty nine percent (49%) of the common stock in REIT
is
conveyed, assigned, sold or otherwise disposed of, whether in one or a series
of
transactions, to any Person or Persons acting as a group, and as a result
thereof, such Person or Persons have the power to elect, appoint or cause
the
election or appointment of at least a majority of the members of the Board
of
Directors of REIT, through beneficial ownership of the capital stock of REIT
or
otherwise, the prior written consent of Lender thereto shall have been obtained,
which consent shall not be unreasonably withheld, conditioned or delayed,
or
(iii) the leasing of any space within the Property so long as Borrower complies
with the provisions of the Loan Documents relating to such leasing
activity.
89
(i) In
connection with any such transfer, Lender shall have received not less than
thirty (30) days prior to the date on which such transfer is to become
effective: (A) prior written notice of such proposed transfer, (B) true and
correct copies of all documentation that will be entered into with respect
to
the same, and (C) all appropriate papers reasonably requested by Lender that
reflect the identity, organization, good standing, tax status and financial
standing of the proposed transferee, which papers shall include certified
copies
of all documents relating to the organization and formation of transferee
and of
the entities, if any, which are partners or members of transferee and updated
organizational charts reflecting such transfer, as well as all other documents
and information reasonably requested by Lender (including such documents
as it
may require to confirm that such proposed transfer will satisfy the requirements
of this Agreement for a transfer to an Approved Transferee, and for Lender
and
each Lender to undertake and approve such background checks and satisfy such
“know-your-customer” requirements as may be required to be performed by
it);
(ii) Lender
shall have determined that such proposed transfer will not result in any
violation of the provisions of Section 4.1.1; and
(iii) Lender
shall have determined that, after giving effect to any such proposed transfer,
the representations and covenants of Borrower set forth in Sections
3.1.24 and 3.1.7 of this Agreement shall be true and correct as if
made immediately after giving effect thereto.
(g) Lender’s
consent to one sale, conveyance, alienation, mortgage, encumbrance, pledge
or
transfer of the Property shall not be deemed to be a waiver of Lender’s right to
require such consent to any future occurrence of same. Any sale,
conveyance, alienation, mortgage, encumbrance, pledge or transfer of the
Property made in contravention of this paragraph shall be null and void and
of
no force and effect.
(h) Borrower
agrees to bear and shall pay or reimburse Lender on demand for all reasonable
expenses (including, without limitation, reasonable attorneys’ fees and
disbursements, title search costs and title insurance endorsement premiums)
actually incurred by Lender in connection with the review, approval and
documentation of any such sale, conveyance, alienation, mortgage, encumbrance,
pledge or transfer.
(i) No
Restricted Party shall incur any indebtedness that would be secured by the
pledge of any direct or indirect ownership interests in any entity the principal
asset, directly or indirectly, of which is any ownership interests in Borrower,
unless such indebtedness is a Permitted Mezzanine Loan. Borrower
shall, not less than twenty (20) days prior to the incurrence by any Restricted
Party of any indebtedness that would be secured by the pledge of any direct
or
indirect ownership interests in any entity the principal asset, directly
or
90
indirectly,
of which is any ownership interests in Borrower, deliver written notice thereof
to Lender and provide to Lender copies of the proposed documentation for
such
mezzanine loan, together with such documentation and certifications of Borrower
as Lender shall require in order to confirm that such indebtedness is a
Permitted Mezzanine Loan. Lender reserves the right to condition its
consent to any proposed mezzanine loan upon:
(i) the
delivery to Lender of information (including without limitation an Appraisal
and
such financial reports as Lender may require) confirming that such proposed
mezzanine loan (A) is in a maximum principal amount (measured in the aggregate
for such proposed mezzanine loan together with all other Permitted Mezzanine
Loans that would remain in effect after the consummation of such proposed
mezzanine loan) shall not exceed the lesser of $50,000,000 or the Permitted
Mezzanine Loan Underwritten Amount; (B) is evidenced and secured by loan
documents in form and substance reasonably acceptable to Lender based on
forms
used in comparable transactions, has a term expiring on or after the Maturity
Date, involves cash management arrangements satisfactory to Lender, and is
the
subject of an intercreditor agreement between Lender and the proposed lender
of
such proposed mezzanine loan, which shall be in a customary form reasonably
acceptable to the Lender; notwithstanding the foregoing, it is understood
that
during the twelve (12) month period following the Closing Date, the Appraised
Value of the Property shall be based upon the Appraisal obtained by Lender
prior
to the Closing Date and that during the twelve (12) month period following
Lender’s approval of any other Appraisal, the Appraised Value of the Property
for these purposes shall be based upon such Appraisal, and that no new Appraisal
shall be required for purposes of this Section 8.1(i)(i) during such
periods;
(ii) receipt
by Lender of Rating Agency Confirmation with respect to the proposed
loan;
(iii) delivery
to Lender of evidence that, after giving effect to the proposed mezzanine
loan,
Borrower will be in compliance with the covenants set forth in this Agreement
(including, without limitation, the covenants in Section 3.1.24) and the
other Loan Documents;
(iv) Borrower
having no direct or indirect liability for the obligations of the mezzanine
borrower under the proposed mezzanine loan;
(v) the
delivery to Lender of a satisfactory non-consolidation opinion (which opinion
shall be in form, scope and substance acceptable in all respects to Lender
and
the Rating Agencies), modified organizational documents and modifications
of the
Loan Documents to reflect the existence and terms of such mezzanine loan;
and
(vi) the
Borrower of such Permitted Mezzanine Loan shall not be the Mezzanine Borrower
as
defined in Section 11.32.
All
expenses incurred by Lender in connection with its review of a proposed
mezzanine loan (including, without limitation, legal fees and expenses in
connection therewith, and in
91
connection
with the preparation, negotiation of an intercreditor agreement relating
thereto) shall be payable by Borrower whether or not Lender consents to the
proposed mezzanine loan.
|
|
IX.
|
SALE
AND SECURITIZATION OF
MORTGAGE
|
Section
9.1. Sale
of Mortgage and Securitization.
(a) Lender
shall have the right (i) to sell or otherwise transfer the Loan or any
portion thereof as a whole loan, (ii) to sell participation interests in
the Loan or (iii) to securitize the Loan or any portion thereof in a single
asset securitization or a pooled loan securitization. (The
transactions referred to in clauses (i), (ii) and (iii) shall hereinafter
be
referred to collectively as “Secondary Market
Transactions” and the transaction referred to in clause
(iii) shall hereinafter be referred to as a
“Securitization.” Any certificates, notes or
other securities issued in connection with a Securitization are hereinafter
referred to as “Securities”).
(b) If
requested by Lender, Borrower shall assist Lender, in satisfying the market
standards to which Lender customarily adheres or which may be reasonably
required in the marketplace or by the Rating Agencies in connection with
any
Secondary Market Transactions, including, without limitation, to:
(i) provide
updated financial and other information with respect to the Property, the
business operated at the Property, Borrower and the Manager, provide updated
budgets relating to the Property and provide updated appraisals, market studies,
environmental reviews (including, Phase I and Phase II reports, as applicable),
property condition reports and other due diligence investigations of the
Property (the “Updated Information”), together, with
appropriate verification of the Updated Information through letters of auditors
or opinions of counsel acceptable to Lender and the Rating
Agencies;
(ii) provide
opinions of counsel, which may be relied upon by Lender, the Rating Agencies
and
their respective counsel, agents and representatives, as to non-consolidation,
fraudulent conveyance and “true sale” or any other opinion customary in
Secondary Market Transactions or required by the Rating Agencies with respect
to
Property and Borrower and Affiliates, which counsel and opinions shall be
satisfactory to Lender and the Rating Agencies;
(iii) provide
updated, as of the closing date of the Secondary Market Transaction,
representations and warranties made in the Loan Documents and such additional
representations and warranties as the Rating Agencies may require;
and
(iv) execute
such amendments to the Loan Documents and Borrower’s organizational documents
reasonably requested by Lender, including, without limitation, amending the
Monthly Payment Date (consistent with the requirements contained in the
definition of such term), the execution of one or more replacement loan
agreements, as may be requested by Lender or the Rating Agencies to effect
the
Securitization and/or deliver one or more new component notes to replace
the
original note or modify the original note to reflect multiple components
of the
Loan (and such new notes or modified note shall comply with Section
11.29), and modify the Cash
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Management
Agreement, if applicable, with respect to the newly created components such
that
the pricing and marketability of the Securities and the size of each class
of
Securities and the rating assigned to each such class by the Rating Agencies
shall provide the most favorable rating levels and achieve the optimum rating
levels for the Loan; provided, however, any such amendments or agreements
will
not materially alter the payment terms set forth in this Agreement or the
other
Loan Documents or materially and adversely affect Borrower or impose additional
material obligations or liabilities upon Borrower and shall comply with
Section 11.29.
(v) attend
management meetings and conduct tours of the Property.
(c) If,
at the time one or more Disclosure Documents are being prepared for a
Securitization, Lender expects that Borrower alone or Borrower and one or
more
Affiliates of Borrower collectively, or the Property alone or the Property
and
Related Properties collectively, will be a Significant Obligor, Borrower
shall
furnish to Lender upon request (i) the selected financial data or, if
applicable, Historical Net Operating Income, required under Item 1112(b)(1)
of
Regulation AB, if Lender expects that the principal amount of the Loan together
with any Related Loans as of the cut-off date for such Securitization may,
or if
the principal amount of the Loan together with any Related Loans as of the
cut-off date for such Securitization and at any time during which the Loan
and
any Related Loans are included in a Securitization does, equal or exceed
ten
percent (10%) (but less than twenty percent (20%) of the aggregate principal
amount of all mortgage loans included or expected to be included, as applicable,
in the Securitization or (ii) the financial statements required under Item
1112(b)(2) of Regulation AB, if Lender expects that the principal amount
of the
Loan together with any Related Loans as of the cut-off date for such
Securitization may, or if the principal amount of the Loan together with
any
Related Loans as of the cut-off date for such Securitization and at any time
during which the Loan and any Related Loans are included in a Securitization
does, equal or exceed twenty percent (20%) of the aggregate principal amount
of
all mortgage loans included or expected to be included, as applicable, in
the
Securitization. Such financial data or financial statements shall be
furnished to Lender (A) within ten (10) Business Days after notice from Lender
in connection with the preparation of Disclosure Documents for the
Securitization, (B) not later than thirty (30) days after the end of each
fiscal
quarter of Borrower and (C) not later than seventy-five (75) days after the
end
of each fiscal year of Borrower; provided, however, that Borrower
shall not be obligated to furnish financial data or financial statements
pursuant to clauses (B) or (C) of this sentence with respect to any period
for
which a filing pursuant to the Exchange Act in connection with or relating
to
the Securitization (an “Exchange Act Filing”) is not
required. If requested by Lender, Borrower shall furnish to Lender
financial data and/or financial statements (if available to Borrower) for
any
Tenant of any of the Property if, in connection with a Securitization, Lender
expects there to be, with respect to such tenant or group of affiliated tenants,
a concentration within all of the mortgage loans included or expected to
be
included, as applicable, in the Securitization such that such tenant or group
of
affiliated tenants would constitute a Significant Obligor.
(d) All
financial data and financial statements provided by Borrower hereunder pursuant
to Section 9.1(c) shall be prepared in accordance with GAAP and shall
meet the requirements of Regulation AB and other applicable legal
requirements. All financial
93
statements
referred to in Section 9.1(c)(ii) above shall be audited by independent
accountants of Borrower acceptable to Lender in accordance with Regulation AB
and all other applicable legal requirements, shall be accompanied by the
manually executed report of the independent accountants thereon, which report
shall meet the requirements of Regulation AB and all other applicable legal
requirements, and shall be further accompanied by a manually executed written
consent of the independent accountants, in form and substance acceptable
to
Lender, to the inclusion of such financial statements in any Disclosure Document
and any Exchange Act Filing and to the use of the name of such independent
accountants and the reference to such independent accountants as “experts” in
any Disclosure Document and Exchange Act Filing, all of which shall be provided
at the same time as the related financial statements are required to be
provided. All financial data and financial statements (audited or
unaudited) provided by Borrower under Section 9.1(c) shall be accompanied
by an Officer’s Certificate which shall state that such financial statements
meet the requirements set forth in the first sentence of this Section
9.1(d).
(e) If
requested by Lender, Borrower shall provide Lender, promptly upon request,
with
any other or additional financial statements, or financial, statistical or
operating information, as Lender shall determine to be required pursuant
to
Regulation AB or any amendment, modification or replacement thereto or other
legal requirements in connection with any Disclosure Document or any Exchange
Act Filing or as shall otherwise be reasonably requested by Lender.
(f) In
the event Lender determines, in connection with a Securitization, that the
financial data and financial statements required in order to comply with
Regulation AB or any amendment, modification or replacement thereto or other
legal requirements are other than as provided herein, then notwithstanding
the
provisions of Sections 9.1(c) and (d), Lender may request, and
Borrower shall promptly provide, such other financial statements as Lender
determines to be necessary or appropriate for such compliance.
Section
9.2. Securitization
Indemnification.
(a) Borrower
understands that information provided to Lender by Borrower and its agents,
counsel and representatives may be included in disclosure documents in
connection with the Securitization, including, without limitation, an offering
circular, a prospectus, prospectus supplement, private placement memorandum
or
other offering document (each, a “Disclosure Document”)
and may also be included in filings with the Securities and Exchange Commission
pursuant to the Securities Act of 1933, as amended (the “Securities
Act”), or the Securities and Exchange Act of 1934, as amended (the
“Exchange Act”), and may be made available to investors
or prospective investors in the Securities, the Rating Agencies, and service
providers relating to the Securitization.
(b) Borrower
shall provide in connection with a Securitization an indemnification agreement
(A) certifying that (i) Borrower has carefully examined the Disclosure
Documents sections entitled “Descriptions of the Mortgages”, “Description of the
Mortgage Loans and Mortgaged Property”, “The Manager”, “The Borrower” and
“Certain Legal Aspects of the Mortgage Loan” and (ii) such sections and such
other information in the Disclosure Documents, but in each case solely as
it
relates to Borrower, Borrower Affiliates, the
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Property,
Manager and all other aspects of the Loan and solely to the extent the
information therein was furnished to Lender by or on behalf of Borrower in
connection with the preparation of the Disclosure Documents or the underwriting
and closing of the Loan (collectively, the “Covered Disclosure
Information”), do not contain any untrue statement of a material
fact known to Borrower or omit to state a material fact known to Borrower
necessary in order to make the statements made, in the light of the
circumstances under which they were made, not misleading, (B) indemnifying
Lender (and for purposes of this Section 9.2, Lender hereunder shall
include its officers and directors), the Affiliate of Lender that has filed
the
registration statement relating to the Securitization (the
“Registration Statement”), each of its directors, each
of its officers who have signed the Registration Statement and each Person
that
controls the Affiliate within the meaning of Section 15 of the Securities
Act or Section 20 of the Exchange Act (collectively, the “Lender
Group”), and Lender, and any other placement agent or underwriter
with respect to the Securitization, each of their respective directors and
each
Person who controls Lender or any other placement agent or underwriter within
the meaning of Section 15 of the Securities Act and Section 20 of the
Exchange Act (collectively, the “Underwriter Group”) for
any losses, claims, damages or liabilities (collectively, the
“Liabilities”) to which Lender, the Lender Group or the
Underwriter Group may become subject insofar as the Liabilities arise out
of or
are based upon any untrue statement or alleged untrue statement of any material
fact contained in the Covered Disclosure Information or arise out of or are
based upon the omission or alleged omission to state in the Covered Disclosure
Information a material fact required to be stated therein or necessary in
order
to make the statements in the Covered Disclosure Information, in light of
the
circumstances under which they were made, not misleading, and (C) agreeing
to reimburse Lender, the Lender Group and/or the Underwriter Group for any
legal
or other expenses reasonably incurred by Lender, such Lender Group and the
Underwriter Group in connection with investigating or defending the Liabilities;
provided, however, that Borrower will be liable in any such case
under clauses (B) or (C) above only to the extent that any such loss claim,
damage or liability arises out of or is based upon any such untrue statement
or
omission made therein in reliance upon and in conformity with information
furnished to Lender by or on behalf of Borrower in connection with the
preparation of the Disclosure Document or in connection with the underwriting
or
closing of the Loan, including, without limitation, financial statements
of
Borrower, operating statements and rent rolls with respect to the
Property. This indemnity agreement will be in addition to any
liability which Borrower may otherwise have.
(c) In
connection with Exchange Act Filings, Borrower shall (i) indemnify Lender,
the Lender Group and the Underwriter Group for Liabilities to which Lender,
the
Lender Group or the Underwriter Group may become subject insofar as the
Liabilities arise out of or are based upon the omission or alleged omission
to
state in the Disclosure Document a material fact required to be stated in
the
Disclosure Document in order to make the statements in the Disclosure Document,
in light of the circumstances under which they were made, not misleading
and
(ii) reimburse Lender, the Lender Group or the Underwriter Group for any
legal or other expenses reasonably incurred by Lender, the Lender Group or
the
Underwriter Group in connection with defending or investigating the
Liabilities.
(d) Promptly
after receipt by an indemnified party under this Section 9.2 of
notice of the commencement of any action, such indemnified party will, if
a
claim in respect thereof is to be made against the indemnifying party under
this
Section 9.2, notify the
95
indemnifying
party in writing of the commencement thereof, but the omission to so notify
the
indemnifying party will not relieve the indemnifying party from any liability
which the indemnifying party may have to any indemnified party hereunder
except
to the extent that failure to notify causes prejudice to the indemnifying
party. In the event that any action is brought against any
indemnified party, and it notifies the indemnifying party of the commencement
thereof, the indemnifying party will be entitled, jointly with any other
indemnifying party, to participate therein and, to the extent that it (or
they)
may elect by written notice delivered to the indemnified party promptly after
receiving the aforesaid notice from such indemnified party, to assume the
defense thereof with counsel satisfactory to such indemnified
party. After notice from the indemnifying party to such indemnified
party under this Section 9.2, such indemnified party shall pay for
any legal or other expenses subsequently incurred by such indemnified party
in
connection with the defense thereof other than reasonable costs of
investigation; provided, however, if the defendants in any such
action include both the indemnified party and the indemnifying party and
the
indemnified party shall have reasonably concluded that there are any legal
defenses available to it and/or other indemnified parties that are different
from or additional to those available to the indemnifying party, the indemnified
party or parties shall have the right to select separate counsel to assert
such
legal defenses and to otherwise participate in the defense of such action
on
behalf of such indemnified party at the cost of the indemnifying
party. The indemnifying party shall not be liable for the expenses of
more than one separate counsel unless an indemnified party shall have reasonably
concluded that there may be legal defenses available to it that are different
from or additional to those available to another indemnified party.
(e) In
order to provide for just and equitable contribution in circumstances in
which
the indemnity agreement provided for in Section 9.2(b) or (c)
is for any reason held to be unenforceable as to an indemnified party in
respect
of any losses, claims, damages or liabilities (or action in respect thereof)
referred to therein which would otherwise be indemnifiable under
Section 9.2(b) or (c), the indemnifying party shall
contribute to the amount paid or payable by the indemnified party as a result
of
such losses, claims, damages or liabilities (or action in respect thereof);
provided, however, that no Person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities
Act) shall be entitled to contribution from any Person who was not guilty
of
such fraudulent misrepresentation. In determining the amount of
contribution to which the respective parties are entitled, the following
factors
shall be considered: (i) Lender’s and Borrower’s relative
knowledge and access to information concerning the matter with respect to
which
the claim was asserted; (ii) the opportunity to correct and prevent any
statement or omission; and (iii) any other equitable considerations
appropriate in the circumstances. Lender and Borrower hereby agree
that it would not be equitable if the amount of such contribution were
determined by pro rata or per capita allocation.
(f) The
liabilities and obligations of both Borrower and Lender under this
Section 9.2 shall survive the termination of this Agreement and the
satisfaction and discharge of the Debt.
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|
|
DEFAULTS
|
Section
10.1. Event
of Default.
(a) Each
of the following events shall constitute an event of default hereunder (an
“Event of Default”):
(i) if
(A) any monthly installment of principal and/or interest due under the
Notes is not paid on or prior to the date on which it is due or the payment
due
on the Maturity Date is not paid on the Maturity Date or (B) any other
portion of the Debt is not paid when due and such non-payment in this
Section 10.1(a)(i)(B) continues for five (5) days following notice
to Borrower that the same is due and payable;
(ii) if
any of the Taxes or Other Charges are not paid prior to
delinquency;
(iii) if
the Policies are not kept in full force and effect;
(iv) if
Borrower breaches or permits or suffers a breach of Article 6 of the Mortgage
or
Article VIII of this Agreement, or Section 2.5 of this
Agreement;
(v) (I)
Except as set forth in Section 10.1(a)(v)(II) below, if any
representation or warranty made by Borrower herein or in any other Loan
Document, or in any report, certificate, financial statement or other
instrument, agreement or document furnished to Lender shall have been false
or
misleading in any material respect as of the date the representation or warranty
was made; (II) Any representation or warranty made or deemed made at any
time
after the Closing Date in Sections 3.1.5, 3.1.9, 3.1.25, or
3.1.37 of this Agreement proves to be untrue in
any material respect when
so made or deemed made, but only if (in the case of any such breach which
is not
intentional) Borrower does not cure such breach within ten (10) Business
Days
after Borrower, Guarantor or the REIT obtains knowledge of the same, it being
understood that the foregoing cure rights shall not apply to any such breach
which is intentional.
(vi) if
Borrower, any SPC Party or Guarantor shall make an assignment for the benefit
of
creditors;
(vii) if
Borrower or Guarantor fails or admits its inability to pay debts generally
as
they become due;
(viii) if
a receiver, liquidator or trustee shall be appointed for Borrower, any SPC
Party
or Guarantor or if Borrower, any SPC Party or Guarantor shall be adjudicated
a
bankrupt or insolvent, or if any petition for bankruptcy, reorganization
or
arrangement pursuant to federal bankruptcy law, or any similar federal or
state
law, shall be filed by or against, consented to, or acquiesced in by, Borrower,
any SPC Party or Guarantor, or if any proceeding for the dissolution or
liquidation of Borrower, any SPC Party or Guarantor shall be instituted;
provided, however, if such appointment, adjudication, petition or proceeding
was
involuntary and not consented to by Borrower,
97
and
SPC
Party or Guarantor, upon the same not being discharged, stayed or dismissed
within sixty (60) days or if an order for relief is entered;
(ix) if
Borrower attempts to assign its rights under this Agreement or any of the
other
Loan Documents or any interest herein or therein in contravention of the
Loan
Documents;
(x) a
default under any agreement creating a Lien or encumbrance on the Property
and,
provided the Property (or part thereof or interest therein) shall not be
in
imminent danger of being sold, forfeited, terminated, cancelled or lost or
there
shall be any danger of the Lien of the Mortgage being primed by any related
Lien, such Lien has not been discharged or bonded over within thirty (30)
days;
(xi) if
any of the assumptions contained in the Insolvency Opinion, or in any other
non-consolidation opinion delivered by Borrower to Lender in connection with
the
Loan, or in any other non-consolidation delivered by Borrower to Lender in
connection with the Loan subsequent to the closing of the Loan, is or shall
become untrue in any material respect;
(xii) if
Borrower breaches any representation, warranty or covenant contained in
Section 3.1.24 hereof;
(xiii) if
Borrower breaches any of the negative covenants contained in Section
4.2.9 hereof or acts or neglects to act in such a manner as to be considered
a material default under the REA;
(xiv) if
Borrower breaches in any material respect any covenant, warranty or
representation contained in the Xxxxxx & Xxxxxxx U.S. Bank Tower Lease
Takeover Agreement;
(xv) if
Guarantor breaches in any material respect any covenant, warranty or
representation contained in the Guarantee or a “Guarantor Event of Default” (as
defined in the Guarantee) occurs;
(xvi) if
Borrower shall continue to be in Default under any of the other terms, covenants
or conditions of this Agreement not specified in subsections (i) through
and
including (xv) above, for ten (10) days after notice to Borrower from Lender,
in
the case of any Default which can be cured by the payment of a sum of money,
or
for thirty (30) days after notice from Lender in the case of any other Default;
provided, however, that if such non-monetary Default is
susceptible of cure but cannot reasonably be cured within such thirty (30)
day
period and provided further that Borrower shall have commenced to cure such
Default within such thirty (30) day period and thereafter diligently and
expeditiously proceeds to cure the same, such thirty (30) day period shall
be
extended for such time as is reasonably necessary for Borrower in the exercise
of due diligence to cure such Default, such additional period not to exceed
sixty (60) days; or
(xvii) if
there shall be Default under any of the other Loan Documents beyond any
applicable cure periods contained in such Loan Documents,
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whether
as to Borrower or the Property, or if any other such event shall occur or
condition shall exist, if the effect of such event or condition is to accelerate
the maturity of any portion of the Debt or to permit Lender to accelerate
the
maturity of all or any portion of the Debt.
(b) Upon
the occurrence of an Event of Default (other than an Event of Default described
in Section 10.1(a) (vi), (vii) or (viii) above) and at any time
thereafter Lender may, in addition to any other rights or remedies available
to
it pursuant to this Agreement and the other Loan Documents or at law or in
equity, take such action, without notice or demand, that Lender deems advisable
to protect and enforce its rights against Borrower and in and to the Property,
including, without limitation, declaring the Debt to be immediately due and
payable, and Lender may enforce or avail itself of any or all rights or remedies
provided in the Loan Documents against Borrower and the Property, including,
without limitation, all rights or remedies available at law or in equity;
and
upon any Event of Default described in Section 10.1(a) (vi), (vii) or
(viii) above, the Debt and all other obligations of Borrower hereunder and
under the other Loan Documents shall immediately and automatically become
due
and payable, without notice or demand, and Borrower hereby expressly waives
any
such notice or demand, anything contained herein or in any other Loan Document
to the contrary notwithstanding.
Section
10.2. Remedies.
(a) Subject
to the limitations set forth in Section 11.22 hereof, upon the occurrence
of an Event of Default, all or any one or more of the rights, powers, privileges
and other remedies available to Lender against Borrower under this Agreement
or
any of the other Loan Documents executed and delivered by, or applicable
to,
Borrower or at law or in equity may be exercised by Lender at any time and
from
time to time, whether or not all or any of the Debt shall be declared due
and
payable, and whether or not Lender shall have commenced any foreclosure
proceeding or other action for the enforcement of its rights and remedies
under
any of the Loan Documents with respect to the Property. Any such
actions taken by Lender shall be cumulative and concurrent and may be pursued
independently, singly, successively, together or otherwise, at such time
and in
such order as Lender may determine in its sole discretion, to the fullest
extent
permitted by law, without impairing or otherwise affecting the other rights
and
remedies of Lender permitted by law, equity or contract or as set forth herein
or in the other Loan Documents. Without limiting the generality of
the foregoing, if an Event of Default is continuing (i) Lender is not
subject to any “one action” or “election of remedies” law or rule, and
(ii) all liens and other rights, remedies or privileges provided to Lender
shall remain in full force and effect until Lender has exhausted all of its
remedies against the Property and the Mortgage has been foreclosed, sold
and/or
otherwise realized upon in satisfaction of the Debt or the Debt has been
paid in
full.
(b) Lender
shall have the right from time to time to partially foreclose the Mortgage
in
any manner and for any amounts secured by the Mortgage then due and payable
as
determined by Lender in its sole discretion including, without limitation,
the
following circumstances: (i) in the event Borrower defaults
beyond any applicable grace period in the payment of one or more scheduled
payments of principal and interest, Lender may foreclose the Mortgage to
recover
such delinquent payments, or (ii) in the event Lender elects to accelerate
less than the entire outstanding principal balance of the Loan, Lender may
foreclose the
99
Mortgage
to recover so much of the principal balance of the Loan as Lender may accelerate
and such other sums secured by the Mortgage as Lender may
elect. Notwithstanding one or more partial foreclosures, the Property
shall remain subject to the Mortgage to secure payment of sums secured by
the
Mortgage and not previously recovered.
(c) Lender
shall have the right from time to time to sever the Notes and the other Loan
Documents into one or more separate notes, mortgages and other security
documents (the “Severed Loan Documents”) in such
denominations as Lender shall determine in its sole discretion for purposes
of
evidencing and enforcing its rights and remedies provided
hereunder. Borrower shall execute and deliver to Lender from time to
time, promptly after the request of Lender, a severance agreement and such
other
documents as Lender shall request in order to effect the severance described
in
the preceding sentence, all in form and substance reasonably satisfactory
to
Lender. Borrower hereby absolutely and irrevocably appoints Lender as
its true and lawful attorney, coupled with an interest, in its name and stead
to
make and execute all documents necessary or desirable to effect the aforesaid
severance, Borrower ratifying all that its said attorney shall do by virtue
thereof; provided, however, Lender shall not make or execute any such documents
under such power until three (3) days after notice has been given to Borrower
by
Lender of Lender’s intent to exercise its rights under such
power. Except as may be required in connection with a Securitization
pursuant to Section 9.1 hereof, (i) Borrower shall not be
obligated to pay any costs or expenses incurred in connection with the
preparation, execution, recording or filing of the Severed Loan Documents,
and
(ii) the Severed Loan Documents shall not contain any representations,
warranties or covenants not contained in the Loan Documents and any such
representations and warranties contained in the Severed Loan Documents will
be
given by Borrower only as of the Closing Date.
(d) Any
amounts recovered from the Property or any other collateral for the Loan
after
an Event of Default may be applied by Lender toward the payment of any interest
and/or principal of the Loan and/or any other amounts due under the Loan
Documents in such order, priority and proportions as Lender in its sole
discretion shall determine.
Section
10.3. Right
to Cure Defaults.
While
an
Event of Default exists, Lender may, but without any obligation to do so
and
without notice to or demand on Borrower and without releasing Borrower from
any
obligation hereunder or being deemed to have cured any Event of Default
hereunder, make, do or perform any obligation of Borrower hereunder in such
manner and to such extent as Lender may deem necessary. Lender is
authorized to enter upon the Property for such purposes, or appear in, defend,
or bring any action or proceeding to protect its interest in the Property
for
such purposes, and the cost and expense thereof (including reasonable attorneys’
fees to the extent permitted by law), with interest as provided in this
Section 10.3, shall constitute a portion of the Debt and shall be due and
payable to Lender upon demand. All such costs and expenses incurred
by Lender in remedying such Event of Default or such failed payment or act
or in
appearing in, defending, or bringing any action or proceeding shall bear
interest at the Default Rate, for the period after such cost or expense was
incurred to the date of payment to Lender. All such costs and
expenses incurred by Lender together with interest thereon calculated at
the
Default Rate shall be deemed to constitute a portion of the Debt and be secured
by the liens, claims and
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security
interests provided to Lender under the Loan Documents and shall be immediately
due and payable upon demand by Lender therefore.
Section
10.4. Remedies
Cumulative.
Subject
to the limitations contained in Section 11.22 hereof, the rights, powers
and remedies of Lender under this Agreement shall be cumulative and not
exclusive of any other right, power or remedy which Lender may have against
Borrower pursuant to this Agreement or the other Loan Documents, or existing
at
law or in equity or otherwise. Lender’s rights, powers and remedies
may be pursued singly, concurrently or otherwise, at such time and in such
order
as Lender may determine in Lender’s sole discretion. No delay or
omission to exercise any remedy, right or power accruing upon an Event of
Default shall impair any such remedy, right or power or shall be construed
as a
waiver thereof, but any such remedy, right or power may be exercised from
time
to time and as often as may be deemed expedient. A waiver of one
Default or Event of Default with respect to Borrower shall not be construed
to
be a waiver of any subsequent Default or Event of Default by Borrower or
to
impair any remedy, right or power consequent thereon.
Section
10.5. Xxxxxx
& Xxxxxxx U.S. Bank Tower Lease Takeover Agreement Cash Collateral
or
Collateral Letter of Credit.
Borrower
may at any time, at its option, and Borrower shall, within ten (10) Business
Days following the occurrence of any Event of Default (without limiting Lender’s
other rights and remedies, upon the occurrence of an Event of Default), or
upon
the occurrence of the circumstances set forth in Section 3.04 of the Xxxxxx
& Xxxxxxx U.S. Bank Tower Lease Guarantee, deliver to Lender an amount equal
to the sum of (i) any amounts then due, payable and unpaid under Xxxxxx
& Xxxxxxx U.S. Bank Tower Lease Takeover Agreement, plus (ii) all
future payments to become due pursuant to the Xxxxxx & Xxxxxxx U.S. Bank
Tower Lease Takeover Agreement in the form of (i) cash collateral, in which
case
such payment shall be deposited to a Collateral Account or (ii) a Collateral
Letter of Credit, in which case such Collateral Letter of Credit shall be
delivered to Lender. Any optional election by Borrower to deliver
such cash collateral or Collateral Letter of Credit to Lender shall be
irrevocable. In the event Borrower delivers such amount to Lender in
the form of cash collateral, the provisions of Sections 10.5.1, 10.5.2 and
10.5.3 shall apply. With respect to any amounts of cash
collateral delivered pursuant to this Section 10.5 and required to be
held in a Controlled Account, Lender shall be entitled to draw upon any cash
deposited in a Controlled Account pursuant to this Section 10.5, in whole
or in part from time to time, to pay any sums due under the Xxxxxx & Xxxxxxx
U.S. Bank Tower Lease Takeover Agreement which are not paid when
due. In the event Borrower pays Lender in the form of a Collateral
Letter of Credit, the provisions of Section 10.5.4 shall
apply. The obligations of Borrower to maintain the Collateral Letter
of Credit or cash collateral shall apply until all sums due under the Xxxxxx
& Xxxxxxx U.S. Bank Tower Lease Takeover Agreement have been paid in full;
provided that to the extent that the obligations of Borrower under the Xxxxxx
& Xxxxxxx U.S. Bank Tower Lease Takeover Agreement are paid and performed,
Borrower may request that the amount of the Collateral Letter of Credit or
cash
collateral be reduced so as to equal an amount not greater than the sum of
any
amounts then due, payable and unpaid under Xxxxxx & Xxxxxxx U.S. Bank Tower
Lease Takeover Agreement, plus all then future payments to become due pursuant
to the Xxxxxx &
101
Xxxxxxx
U.S. Bank Tower Lease Takeover Agreement, and Lender shall (provided that
no
Event of Default then exists) promptly following its receipt of such request
accept a replacement Collateral Letter of Credit in such reduced amount or
release cash collateral (to the extent it is in excess of such reduced
amount).
10.5.1 Establishment
and Maintenance of the Controlled Account.
(a) Each
Controlled Account required hereunder (i) shall be established at, and a
separate and identifiable account from all other funds held by, a Depository
Bank and (ii) shall contain only funds required to be deposited pursuant to
this Section 10.5. Any interest which may accrue on the
amounts on deposit in a Controlled Account shall be added to and shall become
part of the balance of such Controlled Account. Borrower, Lender and
the applicable Depository Bank shall enter into an agreement (a
“Controlled Account Agreement”), substantially in the
form of Schedule X attached hereto (with such changes thereto as may be
required by such Depository Bank and satisfactory to Lender) which shall
govern
such Controlled Account and the rights, duties and obligations of each party
to
such Controlled Account Agreement.
(b) Each
Controlled Account Agreement shall provide that (i) the Controlled Account
shall be established in the name of Lender, (ii) the Controlled Account
shall be subject to the sole dominion, control and discretion of Lender,
and
(iii) neither Borrower nor any other Person other than Lender, including,
without limitation, any Person claiming on behalf of or through Borrower,
shall
have any right or authority, whether express or implied, to make use of or
withdraw, or cause the use or withdrawal of, any proceeds from the Controlled
Account or any of the other proceeds deposited in the Controlled
Account.
10.5.2 Controlled
Account Fees. Borrower shall pay any and all fees
charged by Depository Bank in connection with the maintenance of the Controlled
Account required to be established by or for it hereunder, and the performance
of the Depository Bank’s duties.
10.5.3 Security
Interest.
(a) Borrower
hereby grants a perfected first priority security interest in favor of Lender
in
each Controlled Account established by or for it hereunder and all financial
assets and other property and sums at any time held, deposited or invested
therein, and all security entitlements and investment property relating thereto,
together with any interest or other earnings thereon, and all proceeds thereof,
whether accounts, general intangibles, chattel paper, deposit accounts,
instruments, documents or securities (collectively, “Controlled
Account Collateral”), together with all rights of a secured party
with respect thereto to secure the Loans
(b) Borrower
covenants and agrees:
(i) to
do all acts that may be reasonably necessary to maintain, preserve and protect
the Controlled Account Collateral;
(ii) to
pay promptly when due all material taxes, assessments, charges, encumbrances
and
liens now or hereafter imposed upon or affecting the Controlled Account
Collateral;
102
(iii) to
appear in and defend any action or proceeding which may materially and adversely
affect Borrower’s title to or Lender’s interest in the Controlled Account
Collateral;
(iv) following
the creation of each Controlled Account established by or for Borrower and
the
initial funding thereof, other than to Lender pursuant to this Agreement
or a
Controlled Account Agreement, not to transfer, assign, sell, surrender,
encumber, mortgage, hypothecate, or otherwise dispose of any of the Controlled
Account Collateral or rights or interests therein, and to keep the Controlled
Account Collateral free of all levies and security interests or other liens
or
charges except the security interest in favor of Lender granted
hereunder;
(v) to
account fully for and promptly deliver to Lender, in the form received, all
documents, chattel paper, instruments and agreements constituting the Controlled
Account Collateral hereunder, endorsed to Lender or in blank, as requested
by
Lender, and accompanied by such powers as appropriate and until so delivered
all
such documents, instruments, agreements and proceeds shall be held by Borrower
in trust for Lender, separate from all other property of Borrower;
and
(vi) from
time to time upon request by Lender, to furnish such further assurances of
Borrower’s title with respect to the Controlled Account Collateral, execute such
written agreements, or do such other acts, all as may be reasonably necessary
to
effectuate the purposes of this agreement or as may be required by applicable
Law, or in order to perfect or continue the first-priority lien and security
interest of Lender in the Controlled Account Collateral.
(c) All
interest earned on any Controlled Account shall be retained in such Controlled
Account. Borrower shall treat all interest earned on its Controlled
Account as its income for federal income tax purposes.
(d) Upon
the failure of the Borrower to pay when due any sums due under the Xxxxxx
&
Xxxxxxx U.S. Bank Tower Lease Takeover Agreement, Lender may do any one or
more
of the following, and apply the proceeds thereof to pay any sums due under
the
Xxxxxx & Xxxxxxx U.S. Bank Tower Lease Takeover Agreement which are not paid
when due and Lender’s costs and expenses in connection with the exercise of such
rights:
(i) without
any advertisement or notice to or authorization from Borrower (all of which
advertisements, notices and/or authorizations are hereby expressly waived),
withdraw, sell or otherwise liquidate the funds deposited into any Controlled
Account established by or for Borrower, and Borrower hereby consents to any
such
withdrawal and application as a commercially reasonable disposition of such
funds and agrees that such withdrawal shall not result in satisfaction of
the
Loans;
(ii) without
any advertisement or notice to or authorization from Borrower (all of which
advertisements, notices and/or authorizations are hereby expressly waived),
notify any account debtor on any Controlled Account Collateral pledged by
Borrower pursuant hereto to make payment directly to Lender;
103
(iv) sell
or otherwise dispose of all or any portion of the Controlled Account Collateral
pledged by Borrower at one or more public or private sales, whether or not
such
Controlled Account Collateral is present at the place of sale, for cash or
credit or future delivery, on such terms and in such manner as Lender may
determine;
(v) recover
from Borrower all costs and expenses, including, without limitation, reasonable
attorneys’ fees, incurred or paid by Lender in exercising any right, power or
remedy provided by this subsection (v); and
(vi) exercise
any other right or remedy available to Lender under applicable Law or in
equity.
10.5.4 Collateral
Letters of Credit. With respect to any Collateral
Letters of Credit which Borrower may furnish or cause to be furnished to
Lender
in accordance with the terms of this Section 10.5:
(a) Lender
will be entitled, among other things, to make one or more draws pursuant
to this
Agreement by presentment thereof to the issuing bank accompanied only by
Lender's clean sight-draft, it being intended that the issuing bank shall
have
no right to inquire as to Lender's right to draw upon such Collateral Letter
of
Credit;
(b) Lender
shall be entitled to draw upon any Collateral Letter of Credit delivered
pursuant to this Section 10.5, in whole or in part from time to time, to
pay any sums due under the Xxxxxx & Xxxxxxx U.S. Bank Tower Lease Takeover
Agreement which are not paid when due; and
(c) Lender
shall have the right to draw upon any Collateral Letter of Credit within
ten (10) Business Days prior to the expiration date of such Collateral
Letter of Credit or any renewal or extension thereof unless, prior to such
expiration date of such Collateral Letter of Credit, renewal or extension,
Borrower shall have furnished a replacement, extension or renewal Collateral
Letter of Credit, acceptable to Lender, it being the intent hereof that at
no
time shall the unexpired term of any required Collateral Letter of Credit
be
less than ten (10) Business Days. If Lender draws upon a
Collateral Letter of Credit pursuant to the terms hereof, then Lender shall
hold
the proceeds thereof in a Controlled Account as cash
collateral. Lender shall also be entitled to draw upon a Collateral
Letter of Credit if the credit rating of the issuing bank no longer meets
the
standard required under the definition of “Collateral Letter of Credit” and
Borrower does not deliver to Lender a replacement letter of credit that
otherwise conforms to the requirements for Collateral Letters of Credit within
ten (10) Business Days following notice of the same from Lender, or if
Lender reasonably believes that its rights to draw on such Collateral Letter
of
Credit are in imminent jeopardy of not being honored.
10.5.5 In
the event that Borrower delivers cash collateral or a Collateral Letter of
Credit to Lender in compliance with this Agreement, Lender shall be entitled
to
retain such cash
104
collateral
or Collateral Letter of Credit (subject to its rights hereunder) until all
of
Borrower’s obligations under the Xxxxxx & Xxxxxxx U.S. Bank Tower Lease
Takeover Agreement are paid and performed, notwithstanding that any Event
of
Default that may have triggered Borrower’s obligation to deliver such cash
collateral or Collateral Letter of Credit has been cured.
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XI.
|
MISCELLANEOUS
|
Section
11.1. Successors
and Assigns.
Whenever
in this Agreement any of the parties hereto is referred to, such reference
shall
be deemed to include the legal representatives, successors and assigns of
such
party. All covenants, promises and agreements in this Agreement, by
or on behalf of Borrower, shall inure to the benefit of the legal
representatives, successors and assigns of Lender.
Section
11.2. Lender’s
Discretion.
Whenever
pursuant to this Agreement Lender exercises any right given to it to approve
or
disapprove, or any arrangement or term is to be satisfactory to Lender, the
decision of Lender to approve or disapprove or to decide whether arrangements
or
terms are satisfactory or not satisfactory shall (except as is otherwise
specifically herein provided) be in the sole but good faith discretion of
Lender
and shall be final and conclusive. Prior to a Securitization,
whenever pursuant to this Agreement the Rating Agencies are given any right
to
approve or disapprove, or any arrangement or term is to be satisfactory to
the
Rating Agencies, the decision of Lender to approve or disapprove or to decide
whether arrangements or terms are satisfactory or not satisfactory, based
upon
Lender’s good faith determination of Rating Agency criteria, shall be
substituted therefor. The Note B Designated Representative shall be
entitled to the benefits of this Section 11.2 as if each reference herein
to “Lender” included, without limitation Note B Designated
Representative.
Section
11.3. Governing
Law.
(A) THIS
AGREEMENT WAS NEGOTIATED IN THE STATE OF NEW YORK, AND MADE BY BORROWER AND
ACCEPTED BY LENDER IN THE STATE OF NEW YORK, AND THE PROCEEDS OF THE NOTE
DELIVERED PURSUANT HERETO WERE DISBURSED FROM THE STATE OF NEW YORK, WHICH
STATE
THE PARTIES AGREE HAS A SUBSTANTIAL RELATIONSHIP TO THE PARTIES AND TO THE
UNDERLYING TRANSACTION EMBODIED HEREBY, AND IN ALL RESPECTS, INCLUDING, WITHOUT
LIMITING THE GENERALITY OF THE FOREGOING, MATTERS OF CONSTRUCTION, VALIDITY
AND
PERFORMANCE, THIS AGREEMENT AND THE OBLIGATIONS ARISING HEREUNDER SHALL BE
GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW
YORK
APPLICABLE TO CONTRACTS MADE AND PERFORMED IN SUCH STATE (WITHOUT REGARD
TO
PRINCIPLES OF CONFLICT LAWS THAT WOULD RESULT IN THE APPLICATION OF THE LAWS
OF
ANY OTHER JURISDICTION) AND ANY APPLICABLE LAW OF THE UNITED STATES OF AMERICA,
IT BEING UNDERSTOOD THAT, TO THE FULLEST EXTENT PERMITTED BY THE LAW OF SUCH
STATE, THE LAW OF THE STATE OF NEW
105
YORK
SHALL GOVERN THE CONSTRUCTION, VALIDITY AND ENFORCEABILITY OF THIS LOAN
AGREEMENT AND ALL OF THE OBLIGATIONS ARISING HEREUNDER. TO THE
FULLEST EXTENT PERMITTED BY LAW, BORROWER HEREBY UNCONDITIONALLY AND IRREVOCABLY
WAIVES ANY CLAIM TO ASSERT THAT THE LAW OF ANY OTHER JURISDICTION GOVERNS
THIS
AGREEMENT AND THE NOTE. THE PARTIES FURTHER AGREE THAT THIS AGREEMENT
AND THE NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS
OF
THE STATE OF NEW YORK PURSUANT TO SECTION 5-1401 OF THE NEW YORK GENERAL
OBLIGATIONS LAW.
(B) ANY
LEGAL SUIT, ACTION OR PROCEEDING AGAINST LENDER OR BORROWER ARISING OUT OF
OR
RELATING TO THIS AGREEMENT MAY AT LENDER’S OPTION BE INSTITUTED IN ANY FEDERAL
OR STATE COURT IN XXX XXXX XX XXX XXXX, XXXXXX XX XXX XXXX, PURSUANT TO SECTION
5-1402 OF THE NEW YORK GENERAL OBLIGATIONS LAW AND BORROWER WAIVES ANY
OBJECTIONS WHICH IT MAY NOW OR HEREAFTER HAVE BASED ON VENUE AND/OR FORUM
NON
CONVENIENS OF ANY SUCH SUIT, ACTION OR PROCEEDING, AND BORROWER HEREBY
IRREVOCABLY SUBMITS TO THE JURISDICTION OF ANY SUCH COURT IN ANY SUIT, ACTION
OR
PROCEEDING. BORROWER DOES HEREBY DESIGNATE AND
APPOINT:
CT
CORPORATION SYSTEM
000
XXXXX XXXXXX
XXX
XXXX, XXX XXXX 00000
AS
ITS AUTHORIZED AGENT TO ACCEPT AND ACKNOWLEDGE ON ITS BEHALF SERVICE OF ANY
AND
ALL PROCESS WHICH MAY BE SERVED IN ANY SUCH SUIT, ACTION OR PROCEEDING IN
ANY
FEDERAL OR STATE COURT IN NEW YORK, NEW YORK, AND AGREES THAT SERVICE OF
PROCESS UPON SAID AGENT AT SAID ADDRESS AND WRITTEN NOTICE OF SAID SERVICE
MAILED OR DELIVERED TO BORROWER IN THE MANNER PROVIDED HEREIN SHALL BE DEEMED
IN
EVERY RESPECT EFFECTIVE SERVICE OF PROCESS UPON BORROWER, IN ANY SUCH SUIT,
ACTION OR PROCEEDING IN THE STATE OF NEW YORK. BORROWER
(I) SHALL GIVE PROMPT NOTICE TO LENDER OF ANY CHANGED ADDRESS OF ITS
AUTHORIZED AGENT HEREUNDER, (II) MAY AT ANY TIME AND FROM TIME TO TIME
DESIGNATE A SUBSTITUTE AUTHORIZED AGENT WITH AN OFFICE IN NEW YORK, NEW YORK
(WHICH SUBSTITUTE AGENT AND OFFICE SHALL BE DESIGNATED AS THE PERSON AND
ADDRESS
FOR SERVICE OF PROCESS), AND (III) SHALL PROMPTLY DESIGNATE SUCH A
SUBSTITUTE IF ITS AUTHORIZED AGENT CEASES TO HAVE AN OFFICE IN NEW YORK,
NEW
YORK OR IS DISSOLVED WITHOUT LEAVING A SUCCESSOR.
106
No
modification, amendment, extension, discharge, termination or waiver of any
provision of this Agreement or of any other Loan Document, nor consent to
any
departure by Borrower therefrom, shall in any event be effective unless the
same
shall be in a writing signed by the party against whom enforcement is sought,
and then such waiver or consent shall be effective only in the specific
instance, and for the purpose, for which given. Except as otherwise
expressly provided herein, no notice to, or demand on Borrower, shall entitle
Borrower to any other or future notice or demand in the same, similar or
other
circumstances.
Section
11.5. Delay
Not a Waiver.
Neither
any failure nor any delay on the part of Lender in insisting upon strict
performance of any term, condition, covenant or agreement, or exercising
any
right, power, remedy or privilege hereunder, or under any other Loan Document,
shall operate as or constitute a waiver thereof, nor shall a single or partial
exercise thereof preclude any other future exercise, or the exercise of any
other right, power, remedy or privilege. In particular, and not by
way of limitation, by accepting payment after the due date of any amount
payable
under this Agreement or any other Loan Document, Lender shall not be deemed
to
have waived any right either to require prompt payment when due of all other
amounts due under this Agreement or the other Loan Documents, or to declare
a
default for failure to effect prompt payment of any such other
amount. Lender shall have the right to waive or reduce any time
periods that Lender is entitled to under the Loan Documents in its sole and
absolute discretion. The Note B Designated Representative shall be
entitled to the benefits of this Section 11.5 as if each reference herein
to “Lender” included, without limitation Note B Designated
Representative.
Section
11.6. Notices.
All
notices, demands, requests, consents, approvals or other communications (any
of
the foregoing, a “Notice”) required, permitted, or
desired to be given hereunder shall be in writing sent by telefax (with answer
back acknowledged) or by registered or certified mail, postage prepaid, return
receipt requested, or delivered by hand or reputable overnight courier addressed
to the party to be so notified at its address hereinafter set forth, or to
such
other address as such party may hereafter specify in accordance with the
provisions of this Section 11.6. Any Notice shall be
deemed to have been received: (a) three (3) days after the date
such Notice is mailed, (b) on the date of sending by facsimile transmission
if sent during business hours on a Business Day (otherwise on the next Business
Day), (c) on the date of delivery by hand if delivered during business
hours on a Business Day (otherwise on the next Business Day), and (d) on
the next Business Day if sent by an overnight commercial courier, in each
case
addressed to the parties as follows:
107
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Telephone
No.: (000) 000-0000
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|
Facsimile
No.: (000) 000-0000
|
||
|
with
a copy to:
|
Head
of Xxxxx Xxxxxxxxxx
|
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Xxxxxxxx
XX, Xxx Xxxx Branch
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1114
Avenue of the Xxxxxxxx, 00xx Xxxxx
|
||
|
Xxx
Xxxx, Xxx Xxxx 00000
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||
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Telephone
No.: (000) 000-0000
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||
|
Facsimile
No.: (000) 000-0000
|
||
|
with
a copy to:
|
Xxxxxxxx
& Xxxxxxxx LLP
|
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000
Xxxx 0xx Xxxxxx, Xxxxx 0000
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Xxxxxx
X. Xxxxxx, Esq.
|
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Facsimile
No.: (000) 000-0000
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If
to Borrower:
|
Xxxxxxx
Properties- 355 S. Grand, LLC
|
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0000
Xxxxx Xxxxxx, 0xx Xxxxx
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Xxxxx
Xxxxxx, Xxxxxxxxxx 00000
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||
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Attention: Xxxxxx
X. Xxxxxxx III and Xxxx X. Xxxxxx, Esq.
|
||
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Facsimile
No.: (000) 000-0000
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||
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with
a copy to:
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Xxx
Xxxxxx & Xxxxxxxxx LLP
|
|
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0000
Xxxxxxx Xxxx Xxxx, 00xx Xxxxx
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Xxx
Xxxxxxx, Xxxxxxxxxx 00000
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||
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Attention: Xxxxxxx
X. Xxxxxx, Esq.
|
||
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Facsimile
No.: (000) 000-0000
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TO
THE EXTENT PERMITTED BY APPLICABLE LAW, BORROWER AND LENDER EACH HEREBY WAIVES
ANY RIGHT TO TRIAL BY JURY FULLY TO THE EXTENT THAT ANY SUCH RIGHT SHALL
NOW OR
HEREAFTER EXIST WITH REGARD TO THE LOAN DOCUMENTS, OR ANY CLAIM, COUNTERCLAIM
OR
OTHER ACTION ARISING IN CONNECTION THEREWITH. THIS WAIVER OF RIGHT TO
TRIAL BY JURY IS GIVEN KNOWINGLY AND VOLUNTARILY BY BORROWER AND LENDER,
AND IS
INTENDED TO ENCOMPASS INDIVIDUALLY EACH INSTANCE AND EACH ISSUE AS TO WHICH
THE
RIGHT TO A TRIAL BY JURY WOULD OTHERWISE ACCRUE. EACH PARTY IS HEREBY
AUTHORIZED TO FILE A COPY OF THIS PARAGRAPH IN ANY PROCEEDING AS CONCLUSIVE
EVIDENCE OF THIS WAIVER. THE NOTE B DESIGNATED REPRESENTATIVE SHALL
BE ENTITLED TO THE BENEFITS OF THIS SECTION 11.7 AS IF EACH REFERENCE
HEREIN TO “LENDER” INCLUDED, WITHOUT LIMITATION NOTE B DESIGNATED
REPRESENTATIVE.
108
The
Article and/or Section headings and the Table of Contents in this Agreement
are included herein for convenience of reference only and shall not constitute
a
part of this Agreement for any other purpose.
Section
11.9. Severability.
Wherever
possible, each provision of this Agreement shall be interpreted in such manner
as to be effective and valid under applicable law, but if any provision of
this
Agreement shall be prohibited by or invalid under applicable law, such provision
shall be ineffective to the extent of such prohibition or invalidity, without
invalidating the remainder of such provision or the remaining provisions
of this
Agreement.
Section
11.10. Preferences.
To
the
extent Borrower makes a payment or payments to Lender, which payment or proceeds
or any part thereof are subsequently invalidated, declared to be fraudulent
or
preferential, set aside or required to be repaid to a trustee, receiver or
any
other party under any bankruptcy law, state or federal law, common law or
equitable cause, then, to the extent of such payment or proceeds received,
the
obligations hereunder or part thereof intended to be satisfied shall be revived
and continue in full force and effect, as if such payment or proceeds had
not
been received by Lender.
Section
11.11. Waiver
of Notice.
Borrower
shall not be entitled to any notices of any nature whatsoever from Lender
except
with respect to matters for which this Agreement or the other Loan Documents
specifically and expressly provide for the giving of notice by Lender to
Borrower and except with respect to matters for which Borrower is not, pursuant
to applicable Legal Requirements, permitted to waive the giving of
notice. Borrower hereby expressly waives the right to receive any
notice from Lender with respect to any matter for which this Agreement or
the
other Loan Documents do not specifically and expressly provide for the giving
of
notice by Lender to Borrower.
Section
11.12. Remedies
of Borrower.
In
the
event that a claim or adjudication is made that Lender or its agents have
acted
unreasonably or unreasonably delayed acting in any case where, by law or
under
this Agreement or the other Loan Documents, Lender or such agent, as the
case
may be, has an obligation to act reasonably or promptly, neither Lender nor
its
agents shall be liable for any special, consequential or punitive
damages. The Note B Designated Representative shall be entitled to
the benefits of this Section 11.13 as if each reference herein to
“Lender” included, without limitation Note B Designated
Representative.
109
(a) Borrower
shall pay or, if Borrower fails to pay, reimburse Lender upon receipt of
notice
from Lender, for all reasonable costs and expenses (including reasonable
attorneys’ fees and disbursements incurred by Lender in connection with (i)
(A) the preparation, negotiation, execution and delivery of this Agreement
and the Other Loan Documents and the consummation of the transactions
contemplated hereby and thereby and all the costs of furnishing all opinions
of
counsel (including without limitation any opinions requested by Lender as
to any
legal matters pertaining to this Agreement, the other Loan Documents or the
Property); and (B) any securitization, severance, syndication,
componentization, sale or transfer of the Loan or interests therein pursuant
to
Section 9.1, 11.27, 11.29 or 11.32, provided Borrower’s aggregate
liability under this clause (B) shall not exceed $30,000 (other than with
respect to Lender’s legal fees and disbursements, as to which such cap shall not
apply); (ii) Borrower’s ongoing performance of and compliance with Borrower’s
agreements and covenants contained in this Agreement and the other Loan
Documents on its part to be performed or complied with after the Closing
Date,
including, without limitation, confirming compliance with environmental and
insurance requirements; (iii) Lender’s ongoing performance of and
compliance with all agreements and covenants contained in this Agreement
and the
other Loan Documents on its part to be performed or complied with after the
Closing Date; (iv) the negotiation, preparation, execution, delivery and
administration of any consents, amendments, waivers or other modifications
to
this Agreement and the other Loan Documents and any other documents or matters
requested by Borrower; (v) the filing and recording fees and expenses,
title insurance and reasonable fees and expenses of counsel for providing
to
Lender all required legal opinions, and other similar expenses incurred,
in
creating and perfecting the Liens in favor of Lender pursuant to this Agreement
and the other Loan Documents; (vi) enforcing or preserving any rights, in
response to third party claims or the prosecuting or defending of any action
or
proceeding or other litigation or otherwise, in each case against, under
or
affecting Borrower, this Agreement, the other Loan Documents, the Property,
or
any other security given for the Loan; and (vii) enforcing any obligations
of or collecting any payments due from Borrower under this Agreement, the
other
Loan Documents or with respect to the Property or in connection with any
refinancing or restructuring of the credit arrangements provided under this
Agreement in the nature of a “work-out” or of any insolvency or bankruptcy
proceedings; provided, however, that Borrower shall not be liable for the
payment of any such costs and expenses to the extent the same arise by reason
of
the gross negligence, illegal acts, fraud or willful misconduct of
Lender. Any costs due and payable to Lender may be paid to Lender
pursuant to the Cash Management Agreement.
(b) Borrower
shall indemnify, defend and hold harmless Lender and its officers, directors,
agents, employees (and the successors and assigns of the foregoing) (the
“Lender Indemnitees”) from and against any and all
liabilities, obligations, losses, damages, penalties, actions, judgments,
suits,
claims, costs, expenses and disbursements of any kind or nature whatsoever
(including, without limitation, the reasonable fees and disbursements of
counsel
for the Lender Indemnitees in connection with any investigative, administrative
or judicial proceeding commenced or threatened, whether or not the Lender
Indemnitees shall be designated a party thereto and any brokerage commissions
or
finder’s fees claimed by any broker or other party in connection with the Loan),
that may be imposed on, incurred by, or asserted against the Lender Indemnitees
in any manner relating to or arising out of (i) any breach by
110
Borrower
of its obligations under, or any material misrepresentation by Borrower
contained in, this Agreement or the other Loan Documents, or (ii) the use
or intended use of the proceeds of the Loan (collectively, the
“Indemnified Liabilities”); provided, however, that
Borrower shall not have any obligation to the Lender Indemnitees hereunder
to
the extent that such Indemnified Liabilities arise from the gross negligence,
illegal acts, fraud or willful misconduct of the Lender
Indemnitees. To the extent that the undertaking to indemnify, defend
and hold harmless set forth in the preceding sentence may be unenforceable
because it violates any law or public policy, Borrower shall pay the maximum
portion that it is permitted to pay and satisfy under applicable law to the
payment and satisfaction of all Indemnified Liabilities incurred by the Lender
Indemnitees.
(c) The
Note B Designated Representative shall be entitled to the benefits of this
Section 11.13 as if each reference herein to “Lender” included, without
limitation Note B Designated Representative.
Section
11.14. Schedules
Incorporated.
The
Schedules annexed hereto are hereby incorporated herein as a part of this
Agreement with the same effect as if set forth in the body hereof.
Section
11.15. Offsets,
Counterclaims and Defenses.
Any
assignee of Lender’s interest in and to this Agreement and the other Loan
Documents shall take the same free and clear of all offsets, counterclaims
or
defenses which are unrelated to such documents which Borrower may otherwise
have
against any assignor of such documents, and no such unrelated counterclaim
or
defense shall be interposed or asserted by Borrower in any action or proceeding
brought by any such assignee upon such documents and any such right to interpose
or assert any such unrelated offset, counterclaim or defense in any such
action
or proceeding is hereby expressly waived by Borrower.
Section
11.16. No
Joint Venture or Partnership; No Third Party
Beneficiaries.
(a) Borrower
and Lender intend that the relationships created hereunder and under the
other
Loan Documents be solely that of borrower and lender. Nothing herein
or therein is intended to create a joint venture, partnership,
tenancy-in-common, or joint tenancy relationship between Borrower and Lender
nor
to grant Lender any interest in the Property other than that of mortgagee,
beneficiary or lender.
(b) This
Agreement and the other Loan Documents are solely for the benefit of Lender,
Borrower and the other parties to the Loan Documents, as applicable, and
nothing
contained in this Agreement or the other Loan Documents shall be deemed to
confer upon anyone other than Lender, Borrower or such other parties, as
applicable, any right to insist upon or to enforce the performance or observance
of any of the obligations contained herein or therein. All conditions
to the obligations of Lender to make the Loan hereunder are imposed solely
and
exclusively for the benefit of Lender and no other Person shall have standing
to
require satisfaction of such conditions in accordance with their terms or
be
entitled to assume that Lender will refuse to make the Loan in the absence
of
strict compliance with any or all thereof and no other Person shall under
any
circumstances be deemed to be a beneficiary of such
111
conditions,
any or all of which may be freely waived in whole or in part by Lender if,
in
Lender’s sole discretion, Lender deems it advisable or desirable to do
so. This Section 11.16(b) does not impair or affect
in any manner the rights of the Note B Designated Representative provided
for
herein and in the other Loan Documents.
Section
11.17. Publicity.
All
news
releases, publicity or advertising by Borrower or its Affiliates through
any
media intended to reach the general public which refers to the Loan Documents
or
the financing evidenced by the Loan Documents, to Lender or any of its
Affiliates shall be subject to the prior written approval of Lender (except,
and
only to the extent, required by applicable Legal
Requirements). Borrower authorizes Lender to issue press releases,
advertisements and other promotional materials in connection with Lender’s own
promotional and marketing activities, including in connection with a Secondary
Market Transaction, and such materials may describe the Loan in general terms
or
in detail and Lender’s participation therein in the Loan. All
references to Lender contained in any press release, advertisement or
promotional material issued by Borrower shall be approved in writing by Lender
in advance of issuance.
Section
11.18. Waiver
of Marshalling of Assets.
To
the
fullest extent permitted by law, Borrower, for itself and its successors
and
assigns, waives all rights to a marshalling of the assets of Borrower,
Borrower’s partners and others with interests in Borrower, and of the Property,
and shall not assert any right under any laws pertaining to the marshalling
of
assets, the sale in inverse order of alienation, homestead exemption, the
administration of estates of decedents, or any other matters whatsoever to
defeat, reduce or affect the right of Lender under the Loan Documents to
a sale
of the Property for the collection of the Debt without any prior or different
resort for collection or of the right of Lender to the payment of the Debt
out
of the net proceeds of the Property in preference to every other claimant
whatsoever.
Section
11.19. Waiver
of Offsets/Defenses/Counterclaims.
Borrower
hereby waives the right to assert a counterclaim, other than a compulsory
counterclaim, in any action or proceeding brought against it by Lender or
its
agents or otherwise to offset any obligations to make the payments required
by
the Loan Documents. No failure by Lender to perform any of its
obligations hereunder shall be a valid defense to, or result in any offset
against, any payments which Borrower is obligated to make under any of the
Loan
Documents.
Section
11.20. Conflict;
Construction of Documents; Reliance.
In
the
event of any conflict between the provisions of this Agreement and any of
the
other Loan Documents, the provisions of this Agreement shall
control. The parties hereto acknowledge that they were represented by
competent counsel in connection with the negotiation, drafting and execution
of
the Loan Documents and that such Loan Documents shall not be subject to the
principle of construing their meaning against the party which drafted
them. Borrower acknowledges that, with respect to the Loan, Borrower
shall rely solely on its own judgment and advisors in entering into the Loan
without relying in any manner on any
112
statements,
representations or recommendations of Lender or any parent, subsidiary or
Affiliate of Lender. Lender shall not be subject to any limitation
whatsoever in the exercise of any rights or remedies available to it under
any
of the Loan Documents or any other agreements or instruments which govern
the
Loan by virtue of the ownership by it or any parent, subsidiary or Affiliate
of
Lender of any equity interest any of them may acquire in Borrower, and Borrower
hereby irrevocably waives the right to raise any defense or take any action
on
the basis of the foregoing with respect to Lender’s exercise of any such rights
or remedies. Borrower acknowledges that Lender engages in the
business of real estate financings and other real estate transactions and
investments which may be viewed as adverse to or competitive with the business
of Borrower or its Affiliates.
Section
11.21. Brokers
and Financial Advisors.
Borrower
hereby represents that it has dealt with no financial advisors, brokers,
underwriters, placement agents, agents or finders in connection with the
transactions contemplated by this Agreement, other than Eastdil Secured (the
“Broker”). Borrower hereby agrees to pay all
fees and commissions due and payable to Broker. Lender has not
engaged any broker in connection with the transactions contemplated by this
Agreement. Borrower shall indemnify, defend and hold Lender harmless from
and
against any and all claims, liabilities, costs and expenses of any kind
(including Lender’s attorneys’ fees and expenses) in any way relating to or
arising from a claim by any Person (including Broker) that such Person acted
on
behalf of Borrower or Lender in connection with the transactions contemplated
herein. The provisions of this Section 11.21 shall
survive the expiration and termination of this Agreement and the payment
of the
Debt.
Section
11.22. Exculpation.
Subject
to the qualifications below, Lender shall not enforce the liability and
obligation of Borrower to perform and observe the obligations contained in
the
Notes, this Agreement, the Mortgage or the other Loan Documents by any action
or
proceeding wherein a money judgment shall be sought against Borrower, except
that Lender may bring a foreclosure action, an action for specific performance
or any other appropriate action or proceeding to enable Lender to enforce
and
realize upon its interest under the Notes, this Agreement, the Mortgage and
the
other Loan Documents, or in the Property, the Rents, or any other collateral
given to Lender pursuant to the Loan Documents; provided, however, that,
except
as specifically provided herein, any judgment in any such action or proceeding
shall be enforceable against Borrower only to the extent of Borrower’s interest
in the Property, the Reserve Funds, the Rents, Net Proceeds and any other
collateral given to Lender, and Lender, by accepting the Notes, this Agreement,
the Mortgage and the other Loan Documents, shall not xxx for, seek or demand
any
deficiency judgment against Borrower in any such action or proceeding under
or
by reason of or under or in connection with the Notes, this Agreement, the
Mortgage or the other Loan Documents. The provisions of this
Section shall not, however, (a) constitute a waiver, release or
impairment of any obligation evidenced or secured by any of the Loan Documents;
(b) impair the right of Lender to name Borrower as a party defendant in any
action or suit for foreclosure and sale under the Mortgage; (c) affect the
validity or enforceability of any guaranty made in connection with the Loan
(including, without limitation, the Recourse Guarantee and the Xxxxxx &
Xxxxxxx U.S. Bank Tower Lease Guarantee) or any of the rights and remedies
of
Lender thereunder or the
113
rights
of
Lender under any other certificate or agreement delivered by Guarantor;
(d) impair the right of Lender to obtain the appointment of a receiver;
(e) impair the enforcement of the Assignment of Leases; (f) constitute
a prohibition against Lender to seek a deficiency judgment against Borrower
in
order to fully realize the security granted by the Mortgage or to commence
any
other appropriate action or proceeding in order for Lender to exercise its
remedies against the Property; or (g) constitute a waiver of the right of
Lender to enforce the liability and obligation of Borrower, by money judgment
or
otherwise, to the extent of any loss, damage, cost, expense, liability, claim
or
other obligation incurred by Lender (including attorneys’ fees and costs
reasonably incurred) arising out of or in connection with and Borrower shall
be
personally liable for the following:
(i) fraud
or intentional misrepresentation by Borrower Guarantor, or their affiliates
in
connection with the Loan;
(ii) willful
misconduct of Borrower, Guarantor or their affiliates;
(iii) the
breach of any representation, warranty, covenant or indemnification provision
in
the Environmental Indemnity or in the Mortgage concerning environmental laws,
hazardous substances and asbestos and any indemnification of Lender with
respect
thereto in either document to the extent not otherwise covered by an
environmental insurance policy obtained by Borrower and approved by
Lender;
(iv) the
removal or disposal by Borrower, Guarantor or their affiliates of any portion
of
the Property following the occurrence and during the continuance of an Event
of
Default;
(v) the
misapplication or misappropriation by Borrower, Guarantor or their affiliates
of
(A) any insurance proceeds paid by reason of any Casualty to the Property,
(B) any Awards received in connection with the Condemnation of all or a
portion of the Property, (C) any Rents following the occurrence and during
the continuance of an Event of Default and not applied to the Debt, or (D)
any
Rents paid more than one (1) month in advance to the extent such
Rents or any other payments in respect of the Leases and other income of
the
Property or any other collateral are not applied to the costs of maintenance
and
operation of the Property and to the payment of taxes, lien claims, insurance
premiums, debt service and other amounts due under the Loan
Documents;
(vi) failure
to pay (or otherwise bond) charges for labor or materials or other charges
for
work performed at the Property prior to foreclosure and transfer of title
to the
Property and resulting in Liens on any portion of the Property (excluding
such
unpaid work performed for Lender or any receiver);
(vii) any
security deposits, advance deposits, Tenant Letter of Credit or any other
deposits collected with respect to the Property which are not delivered to
Lender upon a foreclosure of the Property or action in lieu thereof, except
to
the extent any such security deposits were applied in accordance with the
terms
and conditions of
114
any
of
the Leases prior to the occurrence of the Event of Default that gave rise
to
such foreclosure or action in lieu thereof;
(viii) the
breach by Borrower of any of its indemnification obligations set forth in
Section 9.2 of this Agreement or referred to in Section 7.10
of the Mortgage;
(ix) Borrower’s
failure to maintain insurance as required by this Agreement or to pay any
taxes
or assessments affecting the Property but only (A) to the extent that the
Property generates cash flow sufficient to permit (and that is available
to)
Borrower to pay the same when due and (B) if such failure does not result
from
the failure of Lender, in violation of this Agreement, to release to Borrower
Insurance Funds or Tax Funds, respectively, for the payment of applicable
insurance premiums or taxes or assessments;
(x) intentional,
physical waste, damage or destruction of any portion of the Property caused
by
the acts or omissions of Borrower or Guarantor or their respective affiliates,
agents, employees or contractors;
(xi) commission
of a criminal act by Borrower Guarantor or their affiliates;
(xii) Borrower’s
failure to appoint a new property manager upon the request of Lender after
an
Event of Default as required by, and in accordance with the terms and provisions
of, this Agreement and the Mortgage;
(xiii) Borrower’s
failure to provide financial information in accordance with, and required
by,
this Agreement (which damages will be limited to Lender’s cost for accountants
and other consultants to prepare such financial information);
(xiv) Borrower’s
failure to maintain its status as a single purpose entity as required by,
and in
accordance with, the terms and provisions of, this Agreement and the Mortgage,
excluding Borrower’s obligations under Section 3.1.24(f) or
(j);
(xv) any
defenses, offset rights or counterclaims that KPMG LLP, a Delaware limited
liability partnership or its successors (“KPMG”) assert
at any time subsequent to the date Lender takes possession of the Property
or a
receiver is appointed therefor, or the date Lender or another purchaser becomes
the owner of the Property by reason of a foreclosure, deed in lieu of
foreclosure or otherwise (the “Turnover Date”)) arising
from the following: (x) liability for certain real estate taxes
pursuant to Section 10.2 of that certain KPMG Lease arising from acts or
events prior to the Turnover Date, (y) the process of reconciliation of
Additional Rent (as such term is defined in the KPMG Lease) for Operating
Expenses (as such term is defined in the KPMG Lease) and Real Property Taxes
(as
such term is defined in the KPMG Lease) for the years 2002 through and including
2007 or any other period prior to the Turnover Date or (z) liability for
any
“Additional Tenant Improvement Allowance” (as such term is defined in the KPMG
Lease) pursuant to Section 5.4 of the KPMG Lease; or
115
(xvi) failure
of Borrower (A) to cause the completion of the Xxxxxx Landlord Work in
accordance with Section 6.7 or (B) to fund to Lender any amounts
required to be deposited with Lender in accordance with Section
6.7.2.
Notwithstanding
anything to the contrary in this Agreement, the Notes or any of the Loan
Documents, (A) Lender shall not be deemed to have waived any right which
Lender may have under Section 506(a), 506(b), 1111(b) or any other
provisions of the Bankruptcy Code to file a claim for the full amount of
the
Debt or to require that all collateral shall continue to secure all of the
Debt
owing to Lender in accordance with the Loan Documents, and (B) the Debt
shall be fully recourse to Borrower in the event
that: (i) [reserved]; (ii) Borrower fails to obtain
Lender’s prior consent to any subordinate financing or other voluntary Lien
encumbering the Property, to the extent such consent is required by the terms
of
the Loan Documents; (iii) Borrower fails to obtain Lender’s prior consent
to any transfer prohibited by Section 8.1 hereof, as required by the
Mortgage or this Agreement, to the extent such consent is required by the
Loan
Documents; (iv) Borrower or Guarantor files a voluntary petition under the
Bankruptcy Code or any other Federal or state bankruptcy or insolvency law;
(v) an Affiliate, officer, director, or representative which controls,
directly or indirectly, Borrower or Guarantor files, or joins in the filing
of,
an involuntary petition against Borrower or Guarantor under the Bankruptcy
Code
or any other Federal or state bankruptcy or insolvency law, or solicits or
causes to be solicited petitioning creditors for any involuntary petition
against Borrower or Guarantor from any Person; (vi) Borrower or Guarantor
files an answer consenting to or otherwise acquiescing in or joining in any
involuntary petition filed against it, by any other Person under the Bankruptcy
Code or any other Federal or state bankruptcy or insolvency law, or solicits
or
causes to be solicited petitioning creditors for any involuntary petition
from
any Person; (vii) any Affiliate, officer, director, or representative which
controls Borrower or Guarantor consents to or acquiesces in or joins in an
application for the appointment of a custodian, receiver, trustee, or examiner
for Borrower or any portion of the Property; or (vii) Borrower or Guarantor
makes an assignment for the benefit of creditors, or admits, in writing or
in
any legal proceeding, its insolvency or inability to pay its debts as they
become due.
Section
11.23. Prior
Agreements.
This
Agreement and the other Loan Documents contain the entire agreement of the
parties hereto and thereto in respect of the transactions contemplated hereby
and thereby, and all prior agreements among or between such parties, whether
oral or written, are superseded by the terms of this Agreement and the other
Loan Documents.
Section
11.24. Servicer.
(a) At
the option of Lender, the Loan may be serviced by a servicer (the
“Servicer”) selected by Lender and Lender may delegate
all or any portion of its responsibilities under this Agreement and the other
Loan Documents to the Servicer pursuant to a servicing agreement (the
“Servicing Agreement”) between Lender and
Servicer. Borrower shall be responsible for any reasonable set-up
fees or any other initial costs relating to or arising under the Servicing
Agreement, but not for the payment of any monthly or other fees or expenses
payable under the Servicing Agreement or for any other costs or expenses
of
preparing or negotiating the Servicing Agreement. Servicer shall,
however, be entitled to reimbursement of
116
costs
and
expenses as and to the same extent (but without duplication) as Lender is
entitled thereto under the applicable provisions of this Agreement and the
other
Loan Documents.
(b) Upon
notice thereof from Lender, Servicer shall have the right to exercise all
rights
of Lender and enforce all obligations of Borrower pursuant to the provisions
of
this Agreement, the Notes and the other Loan Documents.
(c) Provided
Borrower shall have been given notice of Servicer’s address by Lender, Borrower
shall deliver to Servicer duplicate originals of all notices and other
instruments which Borrower may or shall be required to deliver to Lender
pursuant to this Agreement, the Notes and the other Loan Documents (and no
delivery of such notices or other instruments by Borrower shall be of any
force
or effect unless delivered to Lender and Servicer as provided
above).
Section
11.25. Joint
and Several Liability.
If
more
than one Person has executed this Agreement as “Borrower,” the representations,
covenants, warranties and obligations of all such Persons hereunder shall
be
joint and several.
Section
11.26. Creation
of Security Interest.
Notwithstanding
any other provision set forth in this Agreement, the Notes, the Mortgage
or any
of the other Loan Documents, Lender may at any time create a security interest
in all or any portion of its rights under this Agreement, the Notes, the
Mortgage and any other Loan Document (including, without limitation, the
advances owing to it) in favor of any Federal Reserve Bank in accordance
with
Regulation A of the Board of Governors of the Federal Reserve
System.
Section
11.27. Assignments
and Participations.
(a) Lender
may assign to one or more Persons all or a portion of its rights and obligations
under this Loan Agreement. Notwithstanding the foregoing, with
respect to the unfunded portion of Note B-2, Note B-2 Lender shall not assign
all or any portion of its rights and obligations under this Loan Agreement,
except to an Eligible Assignee, without the prior written consent of
Borrower.
(b) Upon
execution and delivery by the assignor and assignee (even if already a Lender)
to Borrower and the Lender of an assignment and acceptance agreement pursuant
to
which such assignee agrees to become a “Lender” hereunder having the commitment
with respect to Future Advances and the portion of the Loan specified in
such
instrument, the assignee shall have, to the extent of such assignment, the
obligations, rights and benefits of a Lender hereunder holding the commitment
with respect to Future Advances and the portion of the Loan assigned to it,
and
the assigning Lender shall, to the extent of such assignment, be released
from
such commitment and portion of the Loan so assigned.
(c) A
Lender may sell or agree to sell to one or more other Persons a participation
in
all or any part of its interest in the Loan, or in its commitment with respect
to Future Advances, provided (A) such Lender’s obligations under this
Agreement and the other
117
Loan
Documents shall remain unchanged, (B) such Lender shall remain solely
responsible to the other parties hereto for the performance of such obligations
and (C) the Borrower and the other Lenders shall continue to deal solely
and directly with such Lender in connection with such Lender’s rights and
obligations under this Agreement and the other Loan
Documents. Borrower agrees that each such participant shall be
entitled to the benefits of Section 2.2.3(d), (e), (f) and (g) to
the same extent as if it were a Lender and had acquired its interest by
assignment.
(d) In
addition to the assignments and participations permitted under the foregoing
provisions of this Section (but without being subject thereto), any Lender
may
(without notice to Borrower) assign and pledge all or any portion of its
Loan
and its Note to any Federal Reserve Bank as collateral security pursuant
to
Regulation A and any operating circular issued by such Federal Reserve Bank,
and
such Loan and Note shall be fully transferable as provided
therein. No such assignment shall release the assigning Lender from
its obligations hereunder.
(e) Lender
may, in connection with any assignment or participation or proposed assignment
or participation pursuant to this Section 11.27, disclose to the assignee
or participant or proposed assignee or participant, as the case may be, any
information relating to Borrower or any of its Affiliates or to any aspect
of
the Loan that has been furnished to the Lender by or on behalf of the Borrower
or any of its Affiliates.
Section
11.28. [Reserved]
Section
11.29. Component
Notes.
Lender,
without in any way limiting Lender’s other rights hereunder, in its sole and
absolute discretion, shall have the right at any time to require Borrower
to
execute and deliver “component” notes (including senior and junior notes) in
replacement of any of the Notes as evidence of the Loan, which notes may
be paid
in such order of priority as may be designated by Lender, provided that
(i) the aggregate principal amount of such “component” notes shall equal
the outstanding principal balance of the Loan immediately prior to the creation
of such “component” notes, (ii) the weighted average interest rate of all
such “component” notes shall on the date created equal the interest rate which
was applicable to the Loan immediately prior to the creation of such “component”
notes, (iii) the debt service on all such “component” notes shall on the
date created equal the debt service which was due under the Loan immediately
prior to the creation of such component notes, (iv) the other terms and
provisions of each of the “component” notes shall be identical in substance and
substantially similar in form to the Loan Documents, and (v) such adjustment
does not increase Borrower’s affirmative obligations or decrease Borrower’s
rights under the Loan Documents or adversely affect the economic terms of
the
Loans, except for the effect on the weighted average interest rate that may
result while an Event of Default exists from the repayment of any lower-yielding
senior note or senior participation prior to the repayment of any
higher-yielding junior note or junior participation. Borrower, at its
cost and expense, shall cooperate with all reasonable requests of Lender
in
order to establish the “component” notes and shall execute and deliver such
documents as shall reasonably be required by Lender and any Rating Agency
in
connection therewith, all in form and substance reasonably satisfactory to
Lender and satisfactory to any Rating Agency, including, without limitation,
the
severance of security documents if requested. In the event
118
Borrower
fails to execute and deliver such documents to Lender within five (5) Business
Days following such request by Lender, Borrower hereby absolutely and
irrevocably appoints Lender as its true and lawful attorney, coupled with
an
interest, in its name and stead to make and execute all documents necessary
or
desirable to effect such transactions, Borrower ratifying all that such attorney
shall do by virtue thereof; provided, however, that notwithstanding any other
provision of Section 9.2 or this Section 11.29 to the contrary,
Borrower shall not be required to enter into any such documents and amendments
which would increase Borrower’s affirmative obligations or decrease Borrower’s
rights under the Loan Documents or adversely affect the economic terms of
the
Loans, except for the effect on the weighted average interest rate that may
result while an Event of Default exists from the repayment of any lower-yielding
senior note or senior participation prior to the repayment of any
higher-yielding junior note or junior participation.
It
shall
be an Event of Default under this Agreement, the Notes, the Mortgage and
the
other Loan Documents if Borrower fails to comply with any of the terms,
covenants or conditions of this Section 11.29 within ten (10) Business
Days of notice thereof.
Section
11.30. Approvals;
Third Parties; Conditions.
All
approval rights retained or exercised by Lender with respect to Leases,
contracts, plans, studies and other matters are solely to facilitate Lender’s
credit underwriting, and shall not be deemed or construed as a determination
that Lender has passed on the adequacy thereof for any other purpose and
may not
be relied upon by Borrower or any other Person. This Agreement is for
the sole and exclusive use of Lender and Borrower and may not be enforced,
nor
relied upon, by any Person other than Lender and Borrower. All
conditions of the obligations of Lender hereunder, including the obligation
to
make advances, if any, are imposed solely and exclusively for the benefit
of
Lender, its successors and assigns, and no other Person shall have standing
to
require satisfaction of such conditions or be entitled to assume that Lender
will refuse to make advances in the absence of strict compliance with any
or all
of such conditions, and no other Person shall, under any circumstances, be
deemed to be a beneficiary of such conditions, any and all of which may be
freely waived in whole or in part by Lender at any time in Lender’s sole
discretion. The Note B Designated Representative shall be entitled to the
benefits of this Section 11.30 as if each reference herein to “Lender”
included, without limitation the Note B Designated Representative.
Section
11.31. Limitation
on Liability of Lender’s Officers, Employees,
etc.
Any
obligation or liability whatsoever of Lender which may arise at any time
under
this Agreement or any other Loan Document shall be satisfied, if at all,
out of
Lender’s interest in the Property only. No such obligation or
liability shall be personally binding upon, nor shall resort for the enforcement
thereof be had to, the property of any of Lender’s shareholders, directors,
officers, employees or agents, regardless of whether such obligation or
liability is in the nature of contract, tort or otherwise. Note B
Designated Representative shall be entitled to the benefits of this Section
11.31 as if each reference herein to “Lender” included, without limitation
Note B Designated Representative.
119
Without
limiting Borrower’s rights under Section 8.1(i), Lender shall have the right at
any time to divide the Loan into two parts (the “Mezzanine
Option”): a mortgage loan (the “Mortgage
Loan”) and a mezzanine loan (the “Mezzanine
Loan”). The principal amount of the Mortgage Loan plus
the principal amount of the Mezzanine Loan shall equal the outstanding principal
balance of the Loan immediately prior to the creation of the Mortgage Loan
and
the Mezzanine Loan. In effectuating the foregoing, Lender (in its
capacity as the lender under the Mezzanine Loan, the “Mezzanine
Lender”) will make a loan to the borrower of the Mezzanine Loan,
which will be Xxxxxxx Properties-355 S. Grand Mezzanine, LLC (the
“Mezzanine Borrower”); Mezzanine Borrower will
contribute the amount of the Mezzanine Loan to Borrower (in its capacity
as
Borrower under the Mortgage Loan, “Mortgage Borrower”)
and Mortgage Borrower will apply the contribution to pay down the Loan to
its
Mortgage Loan amount. The Mortgage Loan and the Mezzanine Loan will
be on the same terms and subject to the same conditions set forth in this
Agreement, the Notes, the Mortgage and the other Loan Documents except as
follows:
(a) Lender
(in its capacity as the lender under the Mortgage Loan, the “Mortgage
Lender”) shall have the right to establish different interest rates
and debt service payments for the Mortgage Loan and the Mezzanine Loan and
to
require the payment of the Mortgage Loan and the Mezzanine Loan in such order
of
priority as may be designated by Lender; provided, that (i) the total loan
amounts for the Mortgage Loan and the Mezzanine Loan shall equal the amount
of
the Loan immediately prior to the creation of the Mortgage Loan and the
Mezzanine Loan, (ii) the weighted average interest rate of the Mortgage Loan
and
the Mezzanine Loan shall on the date created equal the interest rate which
was
applicable to the Loan immediately prior to creation of a Mortgage Loan and
a
Mezzanine Loan and (iii) the debt service payments on the Mortgage Loan note
and
the Mezzanine Loan note shall on the date created equal the debt service
payment
which was due under the Loan immediately prior to creation of a Mortgage
Loan
and a Mezzanine Loan.
(b) Mezzanine
Borrower shall be a special purpose, bankruptcy remote entity pursuant to
applicable Rating Agency criteria and shall own directly or indirectly one
hundred percent (100%) of Mortgage Borrower. The security for the
Mezzanine Loan shall be a pledge of one hundred percent (100%) of the direct
and
indirect ownership interests in Mortgage Borrower.
(c) Mezzanine
Borrower and Mortgage Borrower shall cooperate with all reasonable requests
of
Lender in order to convert the Loan into a Mortgage Loan and a Mezzanine
Loan
and shall execute and deliver such documents as shall reasonably be required
by
Lender and any Rating Agency in connection therewith, including, without
limitation, the delivery of non-consolidation opinions and the modification
of
organizational documents and loan documents. In the event Mortgage
Borrower and/or Mezzanine Borrower fail to execute and deliver such documents
to
Lender within five (5) Business Days following such request by Lender, Mortgage
Borrower and/or Mezzanine Borrower, as applicable, hereby absolutely and
irrevocably appoint Lender as their true and lawful attorney, coupled with
an
interest, in their name and xxxxx to make and execute all documents necessary
or
desirable to effect such
120
transactions,
Mortgage Borrower and/or Mezzanine Borrower, as applicable, ratifying all
that
such attorney shall do by virtue thereof.
(d) It
shall be an Event of Default under this Agreement, the Notes, the Mortgage
and
the other Loan Documents if Borrower or Mezzanine Borrower fails to comply
with
any of the terms, covenants or conditions of this Section 11.32 within
ten (10) Business Days of notice thereof.
Section
11.33. Exclusivity.
Until
the
earlier of ninety (90) days from the Closing Date or completion of syndication
of the Loan, Borrower agrees that no other similar credit facilities or debts
issued by Borrower or Sponsor will be syndicated or privately placed which
might, in Lender’s opinion, have a detrimental effect on the successful
completion of the syndication of the Loan, and will advise Lender immediately
if
any issue is contemplated.
Section
11.34. Rating
Agency Confirmation.
Whenever
in this Agreement or any Loan Document a requirement to obtain a Rating Agency
Confirmation applies, such requirement shall instead require the approval
of
Lender during any period when no portion of the Loan is held by a REMIC
trust.
[NO
FURTHER TEXT ON THIS PAGE]
121
IN
WITNESS WHEREOF, the parties hereto have caused this Loan Agreement to be
duly
executed by their duly authorized representatives, all as of the day and
year
first above written.
|
LENDER:
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||
|
EUROHYPO
AG, NEW YORK BRANCH, the
New
York branch of a German banking
corporation
|
||
|
By:
|
/s/
XXXX XXXXXXXX
|
|
|
Name:
Xxxx Xxxxxxxx
|
||
|
Title:
Director
|
||
|
By:
|
/s/
XXXX XXXX
|
|
|
Name:
Xxxx Xxxx
|
||
|
Title:
Executive Director
|
||
[SIGNATURE
PAGE CONTINUES ON NEXT PAGE]
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BORROWER:
|
||
|
XXXXXXX
PROPERTIES-355 S. GRAND,
LLC,
a Delaware limited liability company
|
||
|
By:
|
/s/
XXXX X. XXXXXX
|
|
|
Name:
Xxxx X. Xxxxxx
|
||
|
Title:
Vice President & Secretary
|
||
