Special Purpose Entity/Separateness. (a) Each Individual Borrower hereby represents, warrants and covenants as of the Funding Date and until such time as all Obligations are fully and finally paid, such Individual Borrower does not currently and/or shall not: (i) change or permit to be changed its organizational documents, if such change would materially and adversely impact the covenants set forth in this Agreement or otherwise violate any prohibited transfer or due on sale provisions set forth in the Loan Documents; (ii) fail to qualify to do business and remain in good standing under the laws of the state in which it was formed and the State, or fail to observe all material corporate formalities; (iii) engage in any line of business or other activity other than (1) acquiring, owning, operating, leasing, managing and disposing of the Individual Property owned by such Individual Borrower (and activities incidental thereto), (2) entering into mortgage loans secured by a Lien upon the Property and the other Collateral, and (3) any and all lawful activities incidental, necessary and appropriate thereto; (iv) acquire or own any assets other than (1) the Property, and (2) such incidental personal property as may be necessary for the operation of the Property or the conduct of its business as contemplated herein; (v) merge into or consolidate with any Person, or dissolve, terminate, liquidate in whole or in part, or change its legal structure; (vi) transfer or otherwise dispose of all or substantially all of its assets, or engage in any transfer of assets outside the ordinary course of its business; (vii) form, acquire, hold or own any subsidiary, or make any investment in any Person (including the acquisition of obligations or securities of its Affiliates or acquisition of evidence of indebtedness issued by any other Person (other than cash and investment-grade securities)); (viii) Intentionally omitted; (ix) incur any debt, secured or unsecured, direct or contingent (including guaranteeing any obligation), other than (1) the Loan; (2) trade and operational indebtedness incurred in the ordinary course of business with trade creditors, provided such indebtedness is (A) unsecured, (B) not evidenced by a note, (C) on commercially reasonable terms and conditions, and (D) due not more than sixty (60) days past the date incurred and paid on or prior to such date; and/or (3) financing leases and purchase money indebtedness incurred in the ordinary course of business relating to personal property on commercially reasonable terms and conditions; (x) Intentionally omitted; (xi) enter into any contract or agreement with any other Borrower Party except upon terms and conditions that are intrinsically fair, commercially reasonable and substantially similar to those that would be available on an arm's-length basis with unaffiliated third parties; (xii) maintain its assets in such a manner that it will be costly or difficult to segregate, ascertain or identify its individual assets from those of any other Person; (xiii) assume or guaranty or otherwise become obligated for the debts of any other Person, hold itself out to be responsible for the debts of any other Person, or otherwise pledge its assets for the benefit of any other Person (other than to Lender to secure the Loan) or hold out its credit as being available to satisfy the obligations of any other Person; (xiv) make any loans or advances to any Person; (xv) fail to file its own tax returns (unless such Individual Borrower is a tax-disregarded entity not required to file tax returns under applicable law) or file a consolidated federal income tax return with any Person (unless prohibited or required, as the case may be, by applicable Legal Requirements); (xvi) fail either to hold itself out to the public as a legal entity separate and distinct from any other Person (including identifying itself as a division or part of any other Person), or to conduct its business solely in its own name (including the failure to use separate stationery, invoices and checks bearing its own name) or fail to correct any known misunderstanding regarding its separate identity; (xvii) fail 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 (including the failure to remain solvent or pay its own expenses and liabilities (including salaries of its own employees) only from its own funds); (xviii) without the unanimous written consent of all of its members, managers, or directors: (1) file or consent to the filing of any petition, either voluntary or involuntary, to take advantage of any creditors rights laws, (2) seek or consent to the appointment of a receiver, liquidator or any similar official, (3) take any action that might cause such entity to become insolvent, (4) make an assignment for the benefit of creditors, (5) otherwise seek relief under any laws relating to the relief from debts or the protection of debtors generally, or (6) take any action in furtherance of any of the foregoing; or (xix) fail to fairly and reasonably allocate expenses that are shared with an Affiliate (including for shared office space and for services performed by an employee of an Affiliate) among the Persons sharing such expenses. (b) The organizational documents of each Individual Borrower shall at all times materially comply with each of the representations, warranties, covenants, and provisions set forth in Subsection 9.11(a).
Appears in 1 contract
Special Purpose Entity/Separateness. (a) Each Individual Borrower hereby representscovenants, warrants and covenants as of the Funding Date and until such time as all Obligations are the Indebtedness is fully and finally paid, such Individual Borrower does not currently and/or shall not:
(i) change or permit to be changed its organizational documentsGoverning Documents, if such change would materially and adversely impact the covenants set forth in this Agreement or otherwise violate any prohibited transfer or due on sale provisions set forth in the Loan Documents;
(ii) fail to qualify to do business and remain in good standing under the laws Laws of the state in which it was formed and the State, or fail to observe all material corporate formalities;
(iii) engage in any line of business or other activity other than (1) acquiring, owning, operating, leasing, managing and disposing of the Individual Property owned by such Individual Borrower (and activities incidental thereto), (2) entering into mortgage loans secured by a Lien upon the Property and the other CollateralLoan, and (3) any and all lawful activities incidental, necessary and appropriate thereto;
(iv) acquire or own any assets other than (1) the Property, and (2) such incidental personal property as may be necessary for the operation of the Property or the conduct of its business as contemplated herein;
(v) merge into or consolidate with any Person, or dissolve, terminate, liquidate in whole or in part, or change its legal structure;
(vi) transfer or otherwise dispose of all or substantially all of its assets, or engage in any transfer of assets outside the ordinary course of its business;
(vii) form, acquire, hold or own any subsidiary, or make any investment in any Person (including the acquisition of obligations or securities of its Affiliates or acquisition of evidence of indebtedness issued by any other Person (other than cash and investment-grade securities));
(viii) Intentionally omittedcommingle its assets with the assets of any other Person;
(ix) incur any debt, secured or unsecured, direct or contingent (including guaranteeing any obligation), other than (1) the Loan; (2) trade and operational indebtedness incurred in the ordinary course of business with trade creditors, provided such indebtedness is (A) unsecured, (B) not evidenced by a note, (C) on commercially reasonable terms and Providence Square 25 Loan No. 00-1103028 4813-0380-2520, v. 3 conditions, and (D) due not more than sixty ninety (6090) days past the date incurred and paid on or prior to such date; , and/or (3) financing leases and purchase money indebtedness incurred in the ordinary course of business relating relative to personal property on commercially reasonable terms and conditions, provided, further, that at no time shall the aggregate outstanding balance of the permitted debt specified in (2) and (3) above exceed $250,000.00;
(x) Intentionally omittedfail to maintain its records, books of account, bank accounts, Financial Statements, accounting records and other entity documents separate and apart from those of any other Person or have its assets listed on the Financial Statement of any other entity; provided, however, that Borrower’s financial position, assets, liabilities, net worth and operating results may be included in the consolidated Financial Statements of an Affiliate so long as Borrower’s assets are listed on Borrower’s own separate balance sheet and that any such consolidated Financial Statements contain a footnote indicating that Borrower is a separate legal entity, that Borrower’s assets and credit are not available to satisfy the debts and other obligations of such Affiliate, and that Borrower maintains separate books and records;
(xi) enter into any contract or agreement with any other Borrower Party Affiliate except upon terms and conditions that are intrinsically fair, commercially reasonable and substantially similar to those that would be available on an arm'sarm’s-length basis with unaffiliated third parties;
(xii) maintain its assets in such a manner that it will be costly or difficult to segregate, ascertain or identify its individual assets from those of any other Person;
(xiii) assume or guaranty or otherwise become obligated for the debts of any other Person, hold itself out to be responsible for the debts of any other Person, or otherwise pledge its assets for the benefit of any other Person (other than to Lender to secure the Loan) or hold out its credit as being available to satisfy the obligations of any other Person;
(xiv) make any loans or advances to any Person;
(xv) fail to file its own tax returns (unless such Individual Borrower is a tax-disregarded entity not required to file tax returns under applicable lawLaw) or file a consolidated federal income tax return with any Person (unless prohibited or required, as the case may be, by applicable Legal RequirementsLaws);
(xvi) fail either to hold itself out to the public as a legal entity separate and distinct from any other Person (including identifying itself as a division or part of any other Person), or to conduct its business solely in its own name (including the failure to use separate stationery, invoices and checks bearing its own name) or fail to correct any known misunderstanding regarding its separate identity;
(xvii) fail 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 (including the failure to remain solvent Solvent or pay its own expenses and liabilities (including salaries of its own employees) only from its own funds); provided, however: (1) Providence Square 26 Loan No. 00-1103028 4813-0380-2520, v. 3 the failure of any principal of or investor in Borrower to contribute additional capital to Borrower shall not constitute a breach of this subsection (xvii) during any period in which the Property experiences negative cash flow unless, without first paying operating expenses, debt service, maintaining commercially reasonable reserves, and all other amounts required the Loan Documents, Borrower (x) commits a default under Section 5.10 hereof, or (y) fails to turn over to Lender Rents received by Borrower after revocation of the license to receive Rents; and (2) a reduction of the market value of the Property (not caused by the acts and/or omissions of Borrower or its agents) below the outstanding Indebtedness shall not constitute a breach of this subsection (xvii);
(xviii) without the prior unanimous written consent of all of its membersBorrower’s members or partners, managersas applicable, and the prior unanimous consent of all the direct owners of Borrower’s general partner or directors: managing member, as applicable, (1) file elect to dissolve or consent liquidate, or permit its general partner or manager to the filing of any petitionelect to dissolve or liquidate, either voluntary its business organization or involuntary, to take advantage of any creditors rights laws, wind up its business affairs; (2) seek consent, or consent allow its general partner or manager to consent, to the appointment of a receiver, trustee or liquidator of all or any similar official, a substantial part of its assets; (3) take any action that might cause such entity to become be adjudicated as bankrupt or insolvent, or file a voluntary petition in bankruptcy, or admit in writing its inability to pay its debts as they become due; (4) make an a general assignment for the benefit of creditors, ; (5) otherwise seek relief file a petition under or take advantage of any laws relating to the relief from debts or the protection of debtors generally, or insolvency Law; (6) file an answer admitting the material allegations of a petition filed against Borrower or Guarantor or any such respective general partner or managing member of Borrower or Guarantor in any bankruptcy, reorganization or insolvency proceeding or petition or request for the appointment of a receiver, or fail to cause the dismissal of such petition within thirty (30) days after the filing of said petition; or (7) take any action in furtherance for the purpose of effecting any of the foregoing; or
(xix) fail to fairly and reasonably allocate expenses that are shared with an Affiliate (including for shared office space and for services performed by an employee of an Affiliate) among the Persons sharing such expenses.
(b) The organizational documents Governing Documents of each Individual Borrower shall at all times materially comply with each of the representations, warranties, covenants, and provisions set forth in Subsection 9.11(aSection 4.11(a).
Appears in 1 contract
Special Purpose Entity/Separateness. (a) Each Individual Borrower hereby representscovenants, warrants and covenants as of the Funding Date and until such time as all Obligations are the Indebtedness is fully and finally paid, such Individual Borrower does not currently and/or shall not:
(i) change or permit to be changed its organizational documentsGoverning Documents, if such change would materially and adversely impact the covenants set forth in this Agreement or otherwise violate any prohibited transfer or due on sale provisions set forth in the Loan Documents;
(ii) fail to qualify to do business and remain in good standing under the laws Laws of the state in which it was formed and the State, or fail to observe all material corporate formalities;
(iii) engage in any line of business or other activity other than (1) acquiring, owning, operating, leasing, managing and disposing of the Individual Property owned by such Individual Borrower (and activities incidental thereto), (2) entering into mortgage loans secured by a Lien upon the Property and the other CollateralLoan, and (3) any and all lawful activities incidental, necessary and appropriate thereto;
(iv) acquire or own any assets other than (1) the Property, and (2) such incidental personal property as may be necessary for the operation of the Property or the conduct of its business as contemplated herein;
(v) merge into or consolidate with any Person, or dissolve, terminate, liquidate in whole or in part, or change its legal structure;
(vi) transfer or otherwise dispose of all or substantially all of its assets, or engage in any transfer of assets outside the ordinary course of its business;
(vii) form, acquire, hold or own any subsidiary, or make any investment in any Person (including the acquisition of obligations or securities of its Affiliates or acquisition of evidence of indebtedness issued by any other Person (other than cash and investment-grade securities));
(viii) Intentionally omittedcommingle its assets with the assets of any other Person;
(ix) incur any debt, secured or unsecured, direct or contingent (including guaranteeing any obligation), other than (1) the Loan; (2) trade and operational indebtedness incurred in the ordinary course of business with trade creditors, provided such indebtedness is (A) unsecured, (B) not evidenced by a note, (C) on commercially reasonable terms and conditions, and (D) due not more than sixty ninety (6090) days past the date incurred and paid on or prior to such date; and/or , provided, further, that at no time shall the aggregate outstanding balance of the permitted debt specified in (32) financing leases and purchase money indebtedness incurred in the ordinary course of business relating to personal property on commercially reasonable terms and conditionsabove exceeds $100,000.00;
(x) Intentionally omittedfail to maintain its records, books of account, bank accounts, Financial Statements, accounting records and other entity documents separate and apart from those of any other Person or have its assets listed on the Financial Statement of any other entity; provided, however, that Borrower’s financial position, assets, liabilities, net worth and operating results may be included in the consolidated Financial Statements of an Affiliate so long as Borrower’s assets are listed on Borrower’s own separate balance sheet and that any such consolidated Financial Statements contain a footnote indicating that Borrower is a separate legal entity, that Borrower’s assets and credit are not available to satisfy the debts and other obligations of such Affiliate, and that Borrower maintains separate books and records;
(xi) enter into any contract or agreement with any other Borrower Party Affiliate except upon terms and conditions that are intrinsically fair, commercially reasonable and substantially similar to those that would be available on an arm'sarm’s-length basis with unaffiliated third parties;
(xii) maintain its assets in such a manner that it will be costly or difficult to segregate, ascertain or identify its individual assets from those of any other Person;
(xiii) assume or guaranty or otherwise become obligated for the debts of any other Person, hold itself out to be responsible for the debts of any other Person, or otherwise pledge its assets for the benefit of any other Person (other than to Lender to secure the Loan) or hold out its credit as being available to satisfy the obligations of any other Person;
(xiv) make any loans or advances to any Person;
(xv) fail to file its own tax returns (unless such Individual Borrower is a tax-disregarded entity not required to file tax returns under applicable lawLaw) or file a consolidated federal income tax return with any Person (unless prohibited or required, as the case may be, by applicable Legal RequirementsLaws);
(xvi) fail either to hold itself out to the public as a legal entity separate and distinct from any other Person (including identifying itself as a division or part of any other Person), or to conduct its business solely in its own name (including the failure to use separate stationery, invoices and checks bearing its own name) or fail to correct any known misunderstanding regarding its separate identity;
(xvii) fail 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 (including the failure to remain solvent Solvent or pay its own expenses and liabilities (including salaries of its own employees) only from its own funds); provided, however: (1) the failure of any (direct or indirect) member of, principal of or investor in Borrower to contribute additional capital to Borrower shall not constitute a breach of this subsection (xvii) during any period in which the Property experiences negative cash flow unless, without first paying operating expenses, debt service, maintaining commercially reasonable reserves, and all other amounts required the Loan Documents, Borrower (x) commits a default under Section 5.10 hereof, or (y) fails to turn over to Lender Rents received by Borrower after revocation of the license to receive Rents; and (2) a reduction of the market value of the Property (not caused by the acts and/or omissions of Borrower or its agents) below the outstanding Indebtedness shall not constitute a breach of this subsection (xvii);
(xviii) without the prior unanimous written consent of all of its membersBorrower’s members or partners, managersas applicable, and the prior unanimous consent of all the direct owners of Borrower’s general partner or directors: managing member, as applicable, (1) file elect to dissolve or consent liquidate, or permit its general partner or manager to the filing of any petitionelect to dissolve or liquidate, either voluntary its business organization or involuntary, to take advantage of any creditors rights laws, wind up its business affairs; (2) seek consent, or consent allow its general partner or manager to consent, to the appointment of a receiver, trustee or liquidator of all or any similar official, a substantial part of its assets; (3) take any action that might cause such entity to become be adjudicated as bankrupt or insolvent, or file a voluntary petition in bankruptcy, or admit in writing its inability to pay its debts as they become due; (4) make an a general assignment for the benefit of creditors, ; (5) otherwise seek relief file a petition under or take advantage of any laws relating to the relief from debts or the protection of debtors generally, or insolvency Law; (6) file an answer admitting the material allegations of a petition filed against Borrower or Guarantor or any such respective general partner or managing member of Borrower or Guarantor in any bankruptcy, reorganization or insolvency proceeding or petition or request for the appointment of a receiver, or fail to cause the dismissal of such petition within thirty (30) days after the filing of said petition; or (7) take any action in furtherance for the purpose of effecting any of the foregoing; or
(xix) fail to fairly and reasonably allocate expenses that are shared with an Affiliate (including for shared office space and for services performed by an employee of an Affiliate) among the Persons sharing such expenses.
(b) The organizational documents Governing Documents of each Individual Borrower shall at all times materially comply with each of the representations, warranties, covenants, and provisions set forth in Subsection 9.11(aSection 4.11(a).
Appears in 1 contract
Special Purpose Entity/Separateness. (a) Each Individual Borrower hereby representscovenants, warrants and covenants as of the Funding Date and until such time as all Obligations are the Indebtedness is fully and finally paid, such Individual Borrower does not currently and/or shall not:
(i) change or permit to be changed its organizational documentsGoverning Documents, if such change would materially and adversely impact the covenants set forth in this Agreement or otherwise violate any prohibited transfer or due on sale provisions set forth in the Loan Documents;
(ii) fail to qualify to do business and remain in good standing under the laws Laws of the state in which it was formed and the State, or fail to observe all material corporate formalities;
(iii) engage in any line of business or other activity other than (1) acquiring, owning, operating, leasing, managing and disposing of the Individual Property owned by such Individual Borrower (and activities incidental thereto), (2) entering into mortgage loans secured by a Lien upon the Property and the other CollateralLoan, and (3) any and all lawful activities incidental, necessary and appropriate thereto;
(iv) acquire or own any assets other than (1) the Property, and (2) such incidental personal property as may be necessary for the operation of the Property or the conduct of its business as contemplated herein;
(v) merge into or consolidate with any Person, or dissolve, terminate, liquidate in whole or in part, or change its legal structure;
(vi) transfer or otherwise dispose of all or substantially all of its assets, or engage in any transfer of assets outside the ordinary course of its business;
(vii) form, acquire, hold or own any subsidiary, or make any investment in any Person (including the acquisition of obligations or securities of its Affiliates or acquisition of evidence of indebtedness issued by any other Person (other than cash and investment-grade securities));
(viii) Intentionally omittedcommingle its assets with the assets of any other Person;
(ix) incur any debt, secured or unsecured, direct or contingent (including guaranteeing any obligation), other than (1) the Loan; (2) trade and operational indebtedness incurred in the ordinary course of business with trade creditors, provided such indebtedness is (A) unsecured, (B) not evidenced by a note, (C) on commercially reasonable terms and conditions, and (D) due not more than sixty (60) days past the date incurred and paid on or prior to such date; and/or (3) financing leases and purchase money indebtedness incurred in the ordinary course of business relating to personal property on commercially reasonable terms and conditions;, provided, further, that at no time shall the aggregate outstanding balance of the permitted debt specified in (2) and (3) above exceed $100,000.00; ▇▇▇ ▇▇▇▇▇ ▇▇ ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇ Loan No. 00-1102522
(x) Intentionally omittedfail to maintain its records, books of account, bank accounts, Financial Statements, accounting records and other entity documents separate and apart from those of any other Person or have its assets listed on the Financial Statement of any other entity; provided, however, that Borrower’s financial position, assets, liabilities, net worth and operating results may be included in the consolidated Financial Statements of an Affiliate so long as Borrower’s assets are listed on Borrower’s own separate balance sheet;
(xi) enter into any contract or agreement with any other Borrower Party Affiliate except upon terms and conditions that are intrinsically fair, commercially reasonable and substantially similar to those that would be available on an arm'sarm’s-length basis with unaffiliated third parties;
(xii) maintain its assets in such a manner that it will be costly or difficult to segregate, ascertain or identify its individual assets from those of any other Person;
(xiii) assume or guaranty or otherwise become obligated for the debts of any other Person, hold itself out to be responsible for the debts of any other Person, or otherwise pledge its assets for the benefit of any other Person (other than to Lender to secure the Loan) or hold out its credit as being available to satisfy the obligations of any other Person;
(xiv) make any loans or advances to any Person;
(xv) fail to file its own tax returns (unless such Individual Borrower is a tax-disregarded entity not required to file tax returns under applicable lawLaw) or file a consolidated federal income tax return with any Person (unless prohibited or required, as the case may be, by applicable Legal RequirementsLaws);
(xvi) fail either to hold itself out to the public as a legal entity separate and distinct from any other Person (including identifying itself as a division or part of any other Person), or to conduct its business solely in its own name (including the failure to use separate stationery, invoices and checks bearing its own name) or fail to correct any known misunderstanding regarding its separate identity;
(xvii) fail 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 (including the failure to remain solvent or pay its own expenses and liabilities (including salaries of its own employees) only from its own funds);; provided, however, in no event shall this subsection (xvii) be deemed to require that any principal of or investor in Borrower contribute additional capital to Borrower provided that (1) so long as Borrower has not distributed or used income in violation of this Section 4.11, the foregoing shall only apply to the extent that there is positive aggregate net cash flow at the Property, and (2) the foregoing shall not be deemed to require capital infusion or loans by any direct or indirect owner of Borrower in order to maintain such capitalizations; The Flats at Carrs Hill, Athens, Georgia Loan No. 00-1102522
(xviii) without the prior unanimous written consent of all of its membersBorrower’s members or partners, managersas applicable, and the prior unanimous consent of all the direct owners of Borrower’s general partner or directors: managing member, as applicable, (1) file elect to dissolve or consent liquidate, or permit its general partner or manager to the filing of any petitionelect to dissolve or liquidate, either voluntary its business organization or involuntary, to take advantage of any creditors rights laws, wind up its business affairs; (2) seek consent, or consent allow its general partner or manager to consent, to the appointment of a receiver, trustee or liquidator of all or any similar official, a substantial part of its assets; (3) take any action that might cause such entity to become be adjudicated as bankrupt or insolvent, or file a voluntary petition in bankruptcy, or admit in writing its inability to pay its debts as they become due; (4) make an a general assignment for the benefit of creditors, ; (5) otherwise seek relief file a petition under or take advantage of any laws relating to the relief from debts or the protection of debtors generally, or insolvency Law; (6) file an answer admitting the material allegations of a petition filed against Borrower or Guarantor or any such respective general partner or managing member of Borrower or Guarantor in any bankruptcy, reorganization or insolvency proceeding or petition or request for the appointment of a receiver, or fail to cause the dismissal of such petition within thirty (30) days after the filing of said petition; or (7) take any action in furtherance for the purpose of effecting any of the foregoing; or
(xix) fail to fairly and reasonably allocate expenses that are shared with an Affiliate (including for shared office space and for services performed by an employee of an Affiliate) among the Persons sharing such expenses.
(b) The organizational documents Governing Documents of each Individual Borrower shall at all times materially comply with each of the representations, warranties, covenants, and provisions set forth in Subsection 9.11(aSection 4.11(a).
Appears in 1 contract
Special Purpose Entity/Separateness. (a) Each Individual Borrower hereby represents, warrants and covenants as of the Funding Date and until such time as all Obligations are fully and finally paid, such Individual Borrower does not currently and/or shall not:
(i) change or permit to be changed its organizational documents, if such change would materially and adversely impact the covenants set forth in this Agreement or otherwise violate any prohibited transfer or due on sale provisions set forth in the Loan Documents;
(ii) fail to qualify to do business and remain in good standing under the laws of the state in which it was formed and the State, or fail to observe all material corporate formalities;
(iii) engage in any line of business or other activity other than (1) acquiring, owning, operating, leasing, managing and disposing of the Individual Property owned by such Individual Borrower (and activities incidental thereto), (2) entering into mortgage loans secured by a Lien upon the Property and the other Collateral, and (3) any and all lawful activities incidental, necessary and appropriate thereto;
(iv) acquire or own any assets other than (1) the Property, and (2) such incidental personal property as may be necessary for the operation of the Property or the conduct of its business as contemplated herein;
(v) merge into or consolidate with any Person, or dissolve, terminate, liquidate in whole or in part, or change its legal structure;
(vi) except as expressly permitted under the Loan Documents, transfer or otherwise dispose of all or substantially all of its assets, or engage in any transfer of assets outside the ordinary course of its business;
(vii) form, acquire, hold or own any subsidiary, or make any investment in any Person (including the acquisition of obligations or securities of its Affiliates or acquisition of evidence of indebtedness issued by any other Person (other than cash and investment-grade securities));
(viii) Intentionally omittedcommingle its assets with the assets of any other Person;
(ix) incur any debt, secured or unsecured, direct or contingent (including guaranteeing any obligation), other than (1) the Loan; , (2) trade and operational indebtedness incurred in the ordinary course of business with trade creditors, provided such indebtedness is (A) unsecured, (B) not evidenced by a note, (C) on commercially reasonable terms and conditions, and (D) due not more than sixty (60) days past the date incurred and paid on or prior to such date; , and/or (3) financing leases and purchase money indebtedness incurred in the ordinary course of business relating to personal property on commercially reasonable terms and conditions;
(x) Intentionally omittedfail to maintain its records, books of account, bank accounts, financial statements, accounting records and other entity documents separate and apart from those of any other Person or have its assets listed on the financial statement of any other entity; provided, however, that Borrower’s financial position, assets, liabilities, net worth and operating results may be included in the consolidated financial statements of an Affiliate so long as Borrower’s assets are listed on Borrower’s own separate balance sheet and that any such consolidated financial statements contain a footnote indicating that Borrower is a separate legal entity, that Borrower’s assets and credit are not available to satisfy the debts and other obligations of such Affiliate, and that Borrower maintains separate books and records;
(xi) enter into any contract or agreement with any other Borrower Party except upon terms and conditions that are intrinsically fair, commercially reasonable and substantially similar to those that would be available on an arm'sarm’s-length basis with unaffiliated third parties;
(xii) maintain its assets in such a manner that it will be costly or difficult to segregate, ascertain or identify its individual assets from those of any other Person;
(xiii) assume or guaranty or otherwise become obligated for the debts of any other Person, hold itself out to be responsible for the debts of any other Person, or otherwise pledge its assets for the benefit of any other Person (other than to Lender to secure the Loan) or hold out its credit as being available to satisfy the obligations of any other Person;
(xiv) make any loans or advances to any Person;
(xv) fail to file its own tax returns (unless such Individual Borrower is a tax-disregarded entity not required to file tax returns under applicable law) or file a consolidated federal income tax return with any Person (unless prohibited or required, as the case may be, by applicable Legal Requirements);
(xvi) fail either to hold itself out to the public as a legal entity separate and distinct from any other Person (including identifying itself as a division or part of any other Person), or to conduct its business solely in its own name (including the failure to use separate stationery, invoices and checks bearing its own name) or fail to correct any known misunderstanding regarding its separate identity;
(xvii) fail 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 (including the failure to remain solvent or pay its own expenses and liabilities (including salaries of its own employees) only from its own funds); provided, however, that this clause (xvii) shall not require any shareholder or beneficial member of Borrower to make any additional capital contributions to Borrower;
(xviii) without the unanimous written consent of all of its members, managers, or directors: shareholders:
(1) file or consent to the filing of any petition, either voluntary or involuntary, to take advantage of any creditors rights laws, (2) seek or consent to the appointment of a receiver, liquidator or any similar official, (3) take any action that might cause such entity to become insolvent, (4) make an assignment for the benefit of creditors, (5) otherwise seek relief under any laws relating to the relief from debts or the protection of debtors generally, or (6) take any action in furtherance of any of the foregoing; or
(xix) fail to fairly and reasonably allocate expenses that are shared with an Affiliate (including for shared office space and for services performed by an employee of an Affiliate) among the Persons sharing such expenses.
(b) The organizational documents of each Individual Borrower shall at all times materially comply with each of the representations, warranties, covenants, and provisions set forth in Subsection 9.11(a). Borrower may satisfy the requirements set forth in the preceding sentence by including the following provision in Borrower’s organizational documents in lieu of setting forth each of the specific covenants set forth in Subsection 9.11(a): "Special Purpose Entity Borrower Provisions. The Company (i.e., Borrower) shall comply with and operate in accordance with the special purpose entity provisions, if any, contained in the loan documents for any then-current financing to which the Company is a party."
Appears in 1 contract
Sources: Fixed Rate Term Loan Agreement (RREEF Property Trust, Inc.)
Special Purpose Entity/Separateness. (a) Each Individual Borrower hereby representscovenants, warrants and covenants as of the Funding Date and until such time as all Obligations are the Indebtedness is fully and finally paid, such Individual Borrower does not currently and/or shall not:
(i) change or permit to be changed its organizational documentsGoverning Documents, if such change would materially and adversely impact the covenants set forth in this Agreement or otherwise violate any prohibited transfer or due on sale provisions set forth in the Loan Documents;
(ii) fail to qualify to do business and remain in good standing under the laws Laws of the state in which it was formed and the State, or fail to observe all material corporate formalities;
(iii) engage in any line of business or other activity other than (1) acquiring, owning, operating, leasing, managing and disposing of the Individual Property owned by such Individual Borrower (and activities incidental thereto), (2) entering into mortgage loans secured by a Lien upon the Property and the other CollateralLoan, and (3) any and all lawful activities incidental, necessary and appropriate thereto;; Domain at Tallahassee 21 Loan No. 00-1102733
(iv) acquire or own any assets other than (1) the Property, and (2) such incidental personal property as may be necessary for the operation of the Property or the conduct of its business as contemplated herein;
(v) merge into or consolidate with any Person, or dissolve, terminate, liquidate in whole or in part, or change its legal structure;
(vi) transfer or otherwise dispose of all or substantially all of its assets, or engage in any transfer of assets outside the ordinary course of its business;
(vii) form, acquire, hold or own any subsidiary, or make any investment in any Person (including the acquisition of obligations or securities of its Affiliates or acquisition of evidence of indebtedness issued by any other Person (other than cash and investment-grade securities));
(viii) Intentionally omittedcommingle its assets with the assets of any other Person;
(ix) incur any debt, secured or unsecured, direct or contingent (including guaranteeing any obligation), other than (1) the Loan; (2) the Permitted Secondary Financing; and (3) trade and operational indebtedness incurred in the ordinary course of business with trade creditors, provided such indebtedness is (A) unsecured, (B) not evidenced by a note, (C) on commercially reasonable terms and conditions, and (D) due not more than sixty ninety (6090) days past the date incurred and paid on or prior to such date; and/or , provided, further, that at no time shall the aggregate outstanding balance of the permitted debt specified in (3) financing leases and purchase money indebtedness incurred in the ordinary course of business relating to personal property on commercially reasonable terms and conditionsabove exceeds $250,000.00;
(x) Intentionally omittedfail to maintain its records, books of account, bank accounts, Financial Statements, accounting records and other entity documents separate and apart from those of any other Person or have its assets listed on the Financial Statement of any other entity; provided, however, that Borrower’s financial position, assets, liabilities, net worth and operating results may be included in the consolidated Financial Statements of an Affiliate so long as Borrower’s assets are listed on Borrower’s own separate balance sheet (which are separate and apart from the consolidated Financial Statements) and that any such consolidated Financial Statements contain a footnote indicating that Borrower is a separate legal entity, that Borrower’s assets and credit are not available to satisfy the debts and other obligations of such Affiliate, and that Borrower maintains separate books and records;
(xi) enter into any contract or agreement with any other Borrower Party Affiliate except upon terms and conditions that are intrinsically fair, commercially reasonable and substantially similar to those that would be available on an arm'sarm’s-length basis with unaffiliated third parties;
(xii) maintain its assets in such a manner that it will be costly or difficult to segregate, ascertain or identify its individual assets from those of any other Person;
(xiii) assume or guaranty or otherwise become obligated for the debts of any other Person, hold itself out to be responsible for the debts of any other Person, or otherwise pledge its assets for the benefit of any other Person (other than to Lender to secure the Loan) or hold out its credit as being available to satisfy the obligations of any other Person;; Domain at Tallahassee 22 Loan No. 00-1102733
(xiv) make any loans or advances to any Person;
(xv) fail to file its own tax returns (unless such Individual Borrower is a tax-disregarded entity not required to file tax returns under applicable lawLaw) or file a consolidated federal income tax return with any Person (unless prohibited or required, as the case may be, by applicable Legal RequirementsLaws);
(xvi) fail either to hold itself out to the public as a legal entity separate and distinct from any other Person (including identifying itself as a division or part of any other Person), or to conduct its business solely in its own name or a trade name owned by Borrower and not used by another entity (including the failure to use separate stationery, invoices and checks bearing its own name) or fail to correct any known misunderstanding regarding its separate identity; provided, Borrower may use the trade name “Domain at Tallahassee” or such other trade name of the Property to the extent such trade name is used for marketing and/or branding purposes, only;
(xvii) fail 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 (including the failure to remain solvent Solvent or pay its own expenses and liabilities (including salaries of its own employees) only from its own funds); provided, however: (1) the existence of negative or insufficient cash flow at the Property shall not constitute a breach of this subsection (xvii) unless, during such period of negative or insufficient cash flow, without first paying operating expenses, debt service, maintaining commercially reasonable reserves, and all other amounts required the Loan Documents, Borrower (x) commits a default under Section 5.10 hereof, or (y) fails to turn over to Lender Rents received by Borrower after revocation of the license to receive Rents; and (2) a reduction of the market value of the Property (not caused by the acts and/or omissions of Borrower or its agents) below the outstanding Indebtedness shall not constitute a breach of this subsection (xvii);
(xviii) without the prior unanimous written consent of all of its membersBorrower’s members or partners, managersas applicable, and the prior unanimous consent of all the direct owners of Borrower’s general partner or directors: managing member, as applicable, (1) file elect to dissolve or consent liquidate, or permit its general partner or manager to the filing of any petitionelect to dissolve or liquidate, either voluntary its business organization or involuntary, to take advantage of any creditors rights laws, wind up its business affairs; (2) seek consent, or consent allow its general partner or manager to consent, to the appointment of a receiver, trustee or liquidator of all or any similar official, a substantial part of its assets; (3) take any action that might cause such entity to become be adjudicated as bankrupt or insolvent, or file a voluntary petition in bankruptcy, or admit in writing its inability to pay its debts as they become due; (4) make an a general assignment for the benefit of creditors, ; (5) otherwise seek relief file a petition under or take advantage of any laws relating to the relief from debts or the protection of debtors generally, or insolvency Law; (6) file an answer admitting the material allegations of a petition filed against Borrower or Guarantor or any such respective general partner or managing member of Borrower or Guarantor in any bankruptcy, reorganization or insolvency proceeding or petition or request for the appointment of a receiver, or fail to cause the dismissal of such petition within ninety (90) days after the filing of said petition; or (7) take any action in furtherance for the purpose of effecting any of the foregoing; or
(xix) fail to fairly and reasonably allocate expenses that are shared with an Affiliate (including for shared office space and for services performed by an employee of an Affiliate) among the Persons sharing such expenses.. Domain at Tallahassee 23 Loan No. 00-1102733
(b) The organizational documents Governing Documents of each Individual Borrower shall at all times materially comply with each of the representations, warranties, covenants, and provisions set forth in Subsection 9.11(aSection 4.11(a).
Appears in 1 contract
Sources: Loan Agreement (Strategic Student & Senior Housing Trust, Inc.)
Special Purpose Entity/Separateness. (a) Each Individual Borrower hereby represents, warrants and covenants as of the Funding Date and until such time as all Obligations are fully and finally paid, Borrower (which for purposes of this Section 9.11 means the original Borrower until the Property is transferred and the Obligations assumed in connection with an Assumption and following any such Individual Borrower Assumption, the successor Borrower) does not currently and/or shall not:
(i) change or permit to be changed its organizational documents, if such change would materially and adversely impact the covenants set forth in this Agreement or otherwise violate any prohibited transfer or due on sale provisions set forth in the Loan Documents;
(ii) fail to qualify to do business and remain in good standing under the laws of the state in which it was formed and the State, or fail to observe all material corporate formalities;
(iii) engage in any line of business or other activity other than (1) acquiring, owning, operating, leasing, managing and disposing of the Individual Property owned by such Individual Borrower (and activities incidental thereto), (2) entering into mortgage loans secured by a Lien upon the Property and the other Collateral, and (3) any and all lawful activities incidental, necessary and appropriate thereto;
(iv) acquire or own any assets other than (1) the Property, and (2) such incidental personal property as may be necessary for the operation of the Property or the conduct of its business as contemplated herein;
(v) merge into or consolidate with any Person, or dissolve, terminate, liquidate in whole or in part, or change its legal structure;
(vi) transfer or otherwise dispose of all or substantially all of its assets, or engage in any transfer of assets outside the ordinary course of its business;
(vii) form, acquire, hold or own any subsidiary, or make any investment in any Person (including the acquisition of obligations or securities of its Affiliates or acquisition of evidence of indebtedness issued by any other Person (other than cash and investment-grade securities));
(viii) Intentionally omittedcommingle its assets with the assets of any other Person;
(ix) incur any debt, secured or unsecured, direct or contingent (including guaranteeing any obligation), other than (1) the Loan; (2) trade and operational indebtedness incurred in the ordinary course of business with trade creditors, provided such indebtedness is (A) unsecured, (B) not evidenced by a note, (C) on commercially reasonable terms and conditions, and (D) due not more than sixty (60) days past the date incurred and paid on or prior to such datethe date when due; and/or (3) financing leases and purchase money indebtedness incurred in the ordinary course of business relating to personal property on commercially reasonable terms and conditions, provided further that at no times shall the aggregate outstanding balance of any debt specified in clauses (2) and (3) above exceed $250,000.00;
(x) Intentionally omittedfail to maintain its records, books of account, bank accounts, financial statements, accounting records and other entity documents separate and apart from those of any other Person or have its assets listed on the financial statement of any other entity; provided, however, that Borrower’s financial position, assets, liabilities, net worth and operating results may be included in the consolidated financial statements of an Affiliate so long as Borrower’s assets are listed on Borrower’s own separate balance sheet and that any such consolidated financial statements contain a footnote indicating that Borrower is a separate legal entity, that Borrower’s assets and credit are not available to satisfy the debts and other obligations of such Affiliate, and that Borrower maintains separate books and records;
(xi) enter into any contract or agreement with any other Borrower Party except upon terms and conditions that are intrinsically fair, commercially reasonable and substantially similar to those that would be available on an arm'sarm’s-length basis with unaffiliated third parties;
(xii) maintain its assets in such a manner that it will be costly or difficult to segregate, ascertain or identify its individual assets from those of any other Person;
(xiii) assume or guaranty or otherwise become obligated for the debts of any other Person, hold itself out to be responsible for the debts of any other Person, or otherwise pledge its assets for the benefit of any other Person (other than to Lender to secure the Loan) or hold out its credit as being available to satisfy the obligations of any other Person;
(xiv) make any loans or advances to any Person;
(xv) fail to file its own tax returns (unless such Individual Borrower is a tax-disregarded entity not required to file tax returns under applicable law) or file a consolidated federal income tax return with any Person (unless prohibited or required, as the case may be, by applicable Legal Requirements);
(xvi) fail either to hold itself out to the public as a legal entity separate and distinct from any other Person (including identifying itself as a division or part of any other Person), or to conduct its business solely in its own name (including the failure to use separate stationery, invoices and checks bearing its own name) or fail to correct any known misunderstanding regarding its separate identity;
(xvii) fail 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 (including the failure to remain solvent or pay its own expenses and liabilities (including salaries of its own employees) only from its own funds); provided that the foregoing shall not obligate any of Borrower’s members, managers or any other direct or indirect equity holders to make any capital contributions to Borrower except as may be required by applicable law;
(xviii) without the unanimous written consent of all of its memberspartners, managers, members, or directors: shareholders:
(1) file or consent to the filing of any petition, either voluntary or involuntary, to take advantage of any creditors rights laws, (2) seek or consent to the appointment of a receiver, liquidator or any similar official, (3) take any action that might cause such entity to become insolvent, (4) make an assignment for the benefit of creditors, (54) otherwise seek relief under any laws relating to the relief from debts or the protection of debtors generally, or (65) take any action in furtherance of any of the foregoing; or
(xix) fail to fairly and reasonably allocate expenses that are shared with an Affiliate (including for shared office space and for services performed by an employee of an Affiliate) among the Persons sharing such expenses.
(b) The limited liability company agreement, partnership agreement, bylaws, trust agreement or other comparable organizational documents document of each Individual Borrower shall at all times materially comply with contain and incorporate as binding obligations and limitations each of the representations, warranties, covenants, covenants and provisions set forth in Subsection Section 9.11(a). Borrower shall not permit any Constituent Party to amend, modify or otherwise change such limited liability company agreement, partnership agreement, bylaws, trust agreement or other comparable organizational document of Borrower in any manner that (i) violates the covenants and provisions set forth in Section 9.11(a), or (ii) amends, modifies or otherwise changes any provision thereof that by its terms cannot be amended, modified or otherwise changed at any time when the Obigations are outstanding or by its terms cannot be modified without Lender’s consent.
Appears in 1 contract
Sources: Fixed Rate Term Loan Agreement (New England Realty Associates Limited Partnership)
Special Purpose Entity/Separateness. (a) Each Individual Borrower hereby representscovenants, warrants and covenants as of the Funding Date and until such time as all Obligations are the Indebtedness is fully and finally paid, such Individual Borrower does not currently and/or shall not:
(i) change or permit to be changed its organizational documentsGoverning Documents, if such change would materially and adversely impact the covenants set forth in this Agreement or otherwise violate any prohibited transfer or due on sale provisions set forth in the Loan Documents; provided, however, the foregoing shall not prohibit Manager from appointing and/or removing officers of Borrower in accordance with the terms of the Governing Documents existing as of the Closing Date;
(ii) fail to qualify to do business and remain in good standing under the laws Laws of the state in which it was formed and the State, or fail to observe all material corporate formalities;
(iii) engage in any line of business or other activity other than (1) acquiring, owning, operating, leasing, managing and disposing of the Individual Property owned by such Individual Borrower (and activities incidental thereto), (2) entering into mortgage loans secured by a Lien upon the Property and the other CollateralLoan, and (3) any and all lawful activities incidental, necessary and appropriate thereto;
(iv) acquire or own any assets other than (1) the Property, and (2) such incidental personal property as may be necessary for the operation of the Property or the conduct of its business as contemplated herein;
(v) merge into or consolidate with any Person, or dissolve, terminate, liquidate in whole or in part, or change its legal structure;
(vi) transfer or otherwise dispose of all or substantially all of its assets, or engage in any transfer of assets outside the ordinary course of its business;
(vii) form, acquire, hold or own any subsidiary, or make any investment in any Person (including the acquisition of obligations or securities of its Affiliates or Flats at Carrs Hill 23 Loan No. 00-1103560 30367245 acquisition of evidence of indebtedness issued by any other Person (other than cash and investment-grade securities));
(viii) Intentionally omittedcommingle its assets with the assets of any other Person;
(ix) incur any debt, secured or unsecured, direct or contingent (including guaranteeing any obligation), other than (1) the Loan; (2) trade and operational indebtedness (excluding, for the avoidance of doubt, Real Estate Taxes) incurred in the ordinary course of business with trade creditors, provided such indebtedness is (A) unsecured, (B) not evidenced by a note, (C) on commercially reasonable terms and conditions, and (D) due not more than sixty ninety (6090) days past the date incurred and paid on or prior to such date; , and/or (3) financing leases and purchase money indebtedness incurred in the ordinary course of business relating relative to personal property on commercially reasonable terms and conditions, provided, further, that at no time shall the aggregate outstanding balance of the permitted debt specified in (2) and (3) above exceed $250,000.00;
(x) Intentionally omittedfail to maintain its records, books of account, bank accounts, Financial Statements, accounting records and other entity documents separate and apart from those of any other Person or have its assets listed on the Financial Statement of any other entity; provided, however, that Borrower’s financial position, assets, liabilities, net worth and operating results may be included in the consolidated Financial Statements of an Affiliate so long as Borrower’s assets are listed on Borrower’s own separate balance sheet;
(xi) enter into any contract or agreement with any other Borrower Party Affiliate except upon terms and conditions that are intrinsically fair, commercially reasonable and substantially similar to those that would be available on an arm'sarm’s-length basis with unaffiliated third parties;
(xii) maintain its assets in such a manner that it will be costly or difficult to segregate, ascertain or identify its individual assets from those of any other Person;
(xiii) assume or guaranty or otherwise become obligated for the debts of any other Person, hold itself out to be responsible for the debts of any other Person, or otherwise pledge its assets for the benefit of any other Person (other than to Lender to secure the Loan) or hold out its credit as being available to satisfy the obligations of any other Person;
(xiv) make any loans or advances to any Person;
(xv) fail to file its own tax returns (unless such Individual Borrower is a tax-disregarded entity not required to file tax returns under applicable lawLaw) or file a consolidated federal income tax return with any Person (unless prohibited or required, as the case may be, by applicable Legal RequirementsLaws);
(xvi) fail either to hold itself out to the public as a legal entity separate and distinct from any other Person (including identifying itself as a division or part of any other Person), or to conduct its business solely in its own name (including the failure to Flats at Carrs Hill 24 Loan No. 00-1103560 30367245 use separate stationery, invoices and checks bearing its own name) or fail to correct any known misunderstanding regarding its separate identity;
(xvii) fail 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 (including the failure to remain solvent Solvent or pay its own expenses and liabilities (including salaries of its own employees) only from its own funds); provided, however: (1) the failure of any principal of or investor in Borrower to contribute additional capital to Borrower shall not constitute a breach of this subsection (xvii) during any period in which the Property experiences negative cash flow unless, without first paying operating expenses, debt service, maintaining commercially reasonable reserves, and all other amounts required the Loan Documents, Borrower (x) commits a default under Section 5.10 hereof, or (y) fails to turn over to Lender Rents received by Borrower after revocation of the license to receive Rents; and (2) a reduction of the market value of the Property (not caused by the acts and/or omissions of Borrower or its agents) below the outstanding Indebtedness shall not constitute a breach of this subsection (xvii);
(xviii) without the prior unanimous written consent of all of its membersBorrower’s members or partners, managersas applicable, and the prior unanimous consent of all the direct owners of Borrower’s general partner or directors: managing member, as applicable, (1) file elect to dissolve or consent liquidate, or permit its general partner or manager to the filing of any petitionelect to dissolve or liquidate, either voluntary its business organization or involuntary, to take advantage of any creditors rights laws, wind up its business affairs; (2) seek consent, or consent allow its general partner or manager to consent, to the appointment of a receiver, trustee or liquidator of all or any similar official, a substantial part of its assets; (3) take any action that might cause such entity to become be adjudicated as bankrupt or insolvent, or file a voluntary petition in bankruptcy, or admit in writing its inability to pay its debts as they become due; (4) make an a general assignment for the benefit of creditors, ; (5) otherwise seek relief file a petition under or take advantage of any laws relating to the relief from debts or the protection of debtors generally, or insolvency Law; (6) file an answer admitting the material allegations of a petition filed against Borrower or Guarantor or any such respective general partner or managing member of Borrower or Guarantor in any bankruptcy, reorganization or insolvency proceeding or petition or request for the appointment of a receiver, or fail to cause the dismissal of such petition within sixty (60) days after the filing of said petition; or (7) take any action in furtherance for the purpose of effecting any of the foregoing; or
(xix) fail to fairly and reasonably allocate expenses that are shared with an Affiliate (including for shared office space and for services performed by an employee of an Affiliate) among the Persons sharing such expenses.
(b) The organizational documents Governing Documents of each Individual Borrower shall at all times materially comply with each of the representations, warranties, covenants, and provisions set forth in Subsection 9.11(aSection 4.11(a).
Appears in 1 contract
Special Purpose Entity/Separateness. (a) Each Individual Borrower hereby representscovenants, warrants and covenants as of the Funding Date and until such time as all Obligations are the Indebtedness is fully and finally paid, such Individual each Borrower does not currently and/or shall not:
(i) change or permit to be changed its organizational documentsGoverning Documents, if such change would materially and adversely impact the covenants set forth in this Agreement or otherwise violate any prohibited transfer or due on sale provisions set forth in the Loan Documents;
(ii) fail to qualify to do business and remain in good standing under the laws Laws of the state in which it was formed and the Statestate in which that part of the real property constituting the Individual Property owned by such Borrower is located, or fail to observe all material corporate formalities;
(iii) engage in any line of business or other activity other than (1) acquiring, owning, operating, leasing, managing and disposing of the applicable Individual Property owned by such Individual Borrower (and activities incidental thereto), (2) entering into mortgage loans secured by a Lien upon the Loan, (3) refinancing the Property and in connection with a permitted repayment of the other CollateralLoan, and (34) any and all lawful activities incidental, necessary and appropriate thereto;
(iv) acquire or own any assets other than (1) the applicable Individual Property, and (2) such incidental personal property as may be necessary for the operation of the applicable Individual Property or the conduct of its business as contemplated herein;
(v) merge into or consolidate with any Person, or dissolve, terminate, liquidate in whole or in part, or change its legal structure;
(vi) transfer or otherwise dispose of all or substantially all of its assets, or engage in any transfer of assets outside the ordinary course of its business;
(vii) form, acquire, hold or own any subsidiary, or make any investment in any Person (including the acquisition of obligations or securities of its Affiliates or acquisition of evidence of indebtedness issued by any other Person (other than cash and investment-grade securities));
(viii) Intentionally omittedcommingle its assets with the assets of any other Person except for any other Person constituting Borrower;
(ix) incur any debt, secured or unsecured, direct or contingent (including guaranteeing any obligation), other than (1) the Loan; (2) trade and operational indebtedness incurred in the ordinary course of business with trade creditorscreditors (including, without limitation, indebtedness related to tenant improvements), provided such indebtedness is (A) unsecured, (B) not evidenced by a note, (C) on commercially reasonable terms and conditions, and (D) due not more than sixty ninety (6090) days past the date incurred and paid on or prior to such date; and/or , provided, further, that at no time shall the aggregate outstanding balance of the permitted debt specified in (32) financing leases and purchase money indebtedness incurred in the ordinary course of business relating to personal property on commercially reasonable terms and conditionsabove exceed $250,000.00;
(x) Intentionally omittedfail to maintain its records, books of account, bank accounts, Financial Statements, accounting records and other entity documents separate and apart from those of any other Person or have its assets listed on the Financial Statement of any other entity except for any other Person constituting Borrower; provided, however, that Borrower’s financial position, assets, liabilities, net worth and operating results may be included in the consolidated Financial Statements of an Affiliate so long as Borrower’s assets are listed on Borrower’s own separate balance sheet and that any such consolidated Financial Statements contain a footnote indicating that Borrower is a separate legal entity, that Borrower’s assets and credit are not available to satisfy the debts and other obligations of such Affiliate, and that Borrower maintains separate books and records;
(xi) enter into any contract or agreement with any other Borrower Party Affiliate except upon terms and conditions that are intrinsically fair, commercially reasonable and substantially similar to those that would be available on an arm'sarm’s-length basis with unaffiliated third parties;
(xii) maintain its assets in such a manner that it will be costly or difficult to segregate, ascertain or identify its individual assets from those of any other Person;
(xiii) except as required by the Loan with respect to the other entities constituting Borrower, assume or guaranty or otherwise become obligated for the debts of any other Person, hold itself out to be responsible for the debts of any other Person, or otherwise pledge its assets for the benefit of any other Person (other than to Lender to secure the Loan) or hold out its credit as being available to satisfy the obligations of any other Person;
(xiv) make any loans or advances to any Person;
(xv) fail to file its own tax returns (unless such Individual Borrower is a tax-disregarded entity not required to file tax returns under applicable lawLaw) or file a consolidated federal income tax return with any Person (unless prohibited or required, as the case may be, by applicable Legal RequirementsLaws);
(xvi) fail either to hold itself out to the public as a legal entity separate and distinct from any other Person (including identifying itself as a division or part of any other Person), or to conduct its business solely in its own name (including the failure to use separate stationery, invoices and checks bearing its own name) or fail to correct any known misunderstanding regarding its separate identity;
(xvii) fail 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 (including the failure to remain solvent Solvent or pay its own expenses and liabilities (including salaries of its own employees) only from its own funds); provided, however: (1) the failure of any principal of or investor in Borrower to contribute additional capital to Borrower shall not constitute a breach of this subsection (xvii) during any period in which the Property experiences negative cash flow unless, without first paying operating expenses, debt service, maintaining commercially reasonable reserves, and all other amounts required the Loan Documents, Borrower (x) commits a default under Section 5.10 hereof, or (y) fails to turn over to Lender Rents received by Borrower after revocation of the license to receive Rents; and (2) a reduction of the market value of the Property (not caused by the acts and/or omissions of Borrower or its agents) below the outstanding Indebtedness shall not constitute a breach of this subsection (xvii);
(xviii) without the prior consent of Borrower sole member and the prior unanimous written consent of all the direct owners of its membersBorrower’s sole member, managers, or directors: (1) file elect to dissolve or consent liquidate, or permit its sole member to the filing of any petitionelect to dissolve or liquidate, either voluntary its business organization or involuntary, to take advantage of any creditors rights laws, wind up its business affairs; (2) seek consent, or consent allow its sole member to consent, to the appointment of a receiver, trustee or liquidator of all or any similar official, a substantial part of its assets; (3) take any action that might cause such entity to become be adjudicated as bankrupt or insolvent, or file a voluntary petition in bankruptcy, or admit in writing its inability to pay its debts as they become due; (4) make an a general assignment for the benefit of creditors, ; (5) otherwise seek relief file a petition under or take advantage of any laws relating to the relief from debts or the protection of debtors generally, or insolvency Law; (6) file an answer admitting the material allegations of a petition filed against Borrower or Guarantor or the managing member of Borrower or Guarantor in any bankruptcy, reorganization or insolvency proceeding or petition or request for the appointment of a receiver, or fail to cause the dismissal of such petition within thirty (30) days after the filing of said petition; or (7) take any action in furtherance for the purpose of effecting any of the foregoing; or
(xix) fail to fairly and reasonably allocate expenses that are shared with an Affiliate (including for shared office space and for services performed by an employee of an Affiliate) ), if any, among the Persons sharing such expenses.
(b) The organizational documents Governing Documents of each Individual Borrower shall at all times materially comply with each of the representations, warranties, covenants, and provisions set forth in Subsection 9.11(aSection 4.11(a).
Appears in 1 contract
Sources: Loan Agreement (Whitestone REIT)