FIXED RATE LOAN AGREEMENT
Dated as of August 11, 1998
BY and AMONG
FIRST UNION REAL ESTATE EQUITY AND MORTGAGE INVESTMENTS,
as Borrower
BANKERS TRUST COMPANY,
as Agent
AND
THE LENDERS LISTED ON THE SIGNATURE PAGES HERETO,
as Lenders
$45,000,000
(Bank Group)
TABLE OF CONTENTS
Page
I. DEFINITIONS; PRINCIPLES OF CONSTRUCTION. . . . . . . . . . . . . . . 1
1.1 Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . 1
1.2 Principles of Construction. . . . . . . . . . . . . . . . . . . 13
II. GENERAL TERMS. . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
2.1 Commitments; Advances; Notes; the Register. . . . . . . . . . . 14
2.1.1 Commitments.. . . . . . . . . . . . . . . . . . . . 14
2.1.2 Borrowing Mechanics. . . . . . . . . . . . . . . . 14
2.1.3 Disbursement of Funds . . . . . . . . . . . . . . . 15
2.1.4 Notes . . . . . . . . . . . . . . . . . . . . . . . 15
2.1.5 The Register. . . . . . . . . . . . . . . . . . . . 16
2.2 Use of Proceeds . . . . . . . . . . . . . . . . . . . . . . . . 16
2.3 Loan Repayments and Prepayments . . . . . . . . . . . . . . . . 16
2.3.1 Repayments. . . . . . . . . . . . . . . . . . . . . 16
2.3.2 Mandatory Prepayments of the Loans. . . . . . . . . 16
2.3.3 Voluntary Prepayments of the Loans. . . . . . . . . 17
2.3.4 Not A Revolver. . . . . . . . . . . . . . . . . . . 17
2.4 Interest. . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
2.4.1 Generally . . . . . . . . . . . . . . . . . . . . . 17
2.4.2 Interest Payments . . . . . . . . . . . . . . . . . 17
2.4.3 Default Rate; Post-Maturity Interest. . . . . . . . 18
2.5 Payments; Computations. . . . . . . . . . . . . . . . . . . . . 18
2.5.1 Making of Payments. . . . . . . . . . . . . . . . . 18
2.5.2 Computation of Interest . . . . . . . . . . . . . . 18
2.5.3 Capital Adequacy Adjustment. . . . . . . . . . . . 18
2.6 Extension of Loan Term. . . . . . . . . . . . . . . . . . . . . 19
2.6.1 Extension Option. . . . . . . . . . . . . . . . . . 19
2.6.2 Conditions to Extend. . . . . . . . . . . . . . . . 19
2.7 Commitment and Other Fees . . . . . . . . . . . . . . . . . . . 20
2.8 Agent Reliance; Defaulting Lenders. . . . . . . . . . . . . . . 20
2.8.1 Agent Reliance. . . . . . . . . . . . . . . . . . . 20
2.8.2 Defaulting Lenders. . . . . . . . . . . . . . . . . 20
2.8.3 Subordination of Defaulting Lenders.. . . . . . . . 21
2.9 Lending Installations . . . . . . . . . . . . . . . . . . . . . 21
2.10 Withholding . . . . . . . . . . . . . . . . . . . . . . . . . . 21
2.11 Sharing of Payments, Etc. . . . . . . . . . . . . . . . . . . . 22
2.12 Pro Rata Treatment. . . . . . . . . . . . . . . . . . . . . . . 23
III. SPECIAL PROVISIONS . . . . . . . . . . . . . . . . . . . . . . . . . 23
3.1 Loss Proceeds Account . . . . . . . . . . . . . . . . . . . . . 23
3.2 Casualty and Condemnation . . . . . . . . . . . . . . . . . . . 23
3.2.1 Casualty, Condemnation and Application of Proceeds. 23
3.2.2 Conflicts With Mortgage Financing . . . . . . . . . 27
IV. CONDITIONS PRECEDENT . . . . . . . . . . . . . . . . . . . . . . . . 27
4.1 Intentionally Omitted.. . . . . . . . . . . . . . . . . . . . . 27
4.2 Conditions Precedent to All Advances. . . . . . . . . . . . . . 27
4.2.1 Notice of Borrowing; Other
Documentation. . . . . . . . . . . . . . . . . . . . . . . 27
4.2.2 Other Conditions. . . . . . . . . . . . . . . . . . 28
V. REPRESENTATIONS AND WARRANTIES . . . . . . . . . . . . . . . . . . . 28
5.1 Borrower Representations. . . . . . . . . . . . . . . . . . . . 28
5.1.1 Organization; Existence . . . . . . . . . . . . . . 28
5.1.2 Proceedings . . . . . . . . . . . . . . . . . . . . 29
5.1.3 No Conflicts. . . . . . . . . . . . . . . . . . . . 29
5.1.4 Litigation. . . . . . . . . . . . . . . . . . . . . 29
5.1.5 Agreements. . . . . . . . . . . . . . . . . . . . . 30
5.1.6 No Bankruptcy Filing. . . . . . . . . . . . . . . . 30
5.1.7 Full and Accurate Disclosure. . . . . . . . . . . . 30
5.1.8 Tax and REIT Status . . . . . . . . . . . . . . . . 30
5.1.9 Use of Proceeds . . . . . . . . . . . . . . . . . . 30
5.1.10 Financial Information . . . . . . . . . . . . . . . 30
5.1.11 No Default. . . . . . . . . . . . . . . . . . . . . 31
5.1.12 Federal Reserve Regulations . . . . . . . . . . . . 31
5.1.13 Enforceability. . . . . . . . . . . . . . . . . . . 31
5.1.14 Incorporation of Representations
and Warranties . . . . . . . . . . . . . . . . . . . . . . 32
VI. AFFIRMATIVE COVENANTS. . . . . . . . . . . . . . . . . . . . . . . . 32
6.1 Borrower Covenants. . . . . . . . . . . . . . . . . . . . . . . 32
6.1.1 SEC Filings and Press Releases. . . . . . . . . . . 32
6.1.2 Business and Operations . . . . . . . . . . . . . . 32
6.1.3 Costs of Enforcement. . . . . . . . . . . . . . . . 32
6.1.4 Estoppel Statement. . . . . . . . . . . . . . . . . 32
6.1.5 Loan Proceeds . . . . . . . . . . . . . . . . . . . 33
6.1.6 Name; Principal Place of Business . . . . . . . . . 33
6.1.7 Board of Trustees . . . . . . . . . . . . . . . . . 33
6.1.8 Offering. . . . . . . . . . . . . . . . . . . . . . 33
6.1.9 Incorporation of Affirmative
Covenants. . . . . . . . . . . . . . . . . . . . . . . . . 33
VII. NEGATIVE COVENANTS . . . . . . . . . . . . . . . . . . . . . . . . . 33
7.1 Borrower Negative Covenants . . . . . . . . . . . . . . . . . . 33
7.1.1 Debt. . . . . . . . . . . . . . . . . . . . . . . . 34
7.1.2 Corporate Structure . . . . . . . . . . . . . . . . 34
7.1.3 Incorporation of Negative Covenants . . . . . . . . 34
VIII. DEFAULTS. . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
8.1 Event of Default. . . . . . . . . . . . . . . . . . . . . . . . 34
8.2 Remedies. . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
8.3 Remedies Cumulative . . . . . . . . . . . . . . . . . . . . . . 37
8.4 Gotham's Cure Rights. . . . . . . . . . . . . . . . . . . . . . 38
IX. MISCELLANEOUS. . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
9.1 Survival. . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
9.2 Lenders' or Agent's Discretion. . . . . . . . . . . . . . . . . 39
9.3 Governing Law . . . . . . . . . . . . . . . . . . . . . . . . . 39
9.4 Modification, Waiver in Writing . . . . . . . . . . . . . . . . 40
9.5 Delay Not a Waiver. . . . . . . . . . . . . . . . . . . . . . . 41
9.6 Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
9.7 Trial By Jury . . . . . . . . . . . . . . . . . . . . . . . . . 42
9.8 Headings. . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
9.9 Severability. . . . . . . . . . . . . . . . . . . . . . . . . . 42
9.10 Preferences . . . . . . . . . . . . . . . . . . . . . . . . . . 42
9.11 Waiver of Notice. . . . . . . . . . . . . . . . . . . . . . . . 43
9.12 Remedies of Borrower. . . . . . . . . . . . . . . . . . . . . . 43
9.13 Non-Exculpation . . . . . . . . . . . . . . . . . . . . . . . . 43
9.14 Expenses; Indemnity . . . . . . . . . . . . . . . . . . . . . . 43
9.15 Exhibits, Schedules Incorporated. . . . . . . . . . . . . . . . 45
9.16 Offsets, Counterclaims and Defenses . . . . . . . . . . . . . . 45
9.17 No Joint Venture or Partnership . . . . . . . . . . . . . . . . 46
9.18 Publicity . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
9.19 Waiver of Counterclaim. . . . . . . . . . . . . . . . . . . . . 46
9.20 Conflict; Construction of Documents . . . . . . . . . . . . . . 46
9.21 Brokers and Financial Advisors. . . . . . . . . . . . . . . . . 46
9.22 Prior Agreements. . . . . . . . . . . . . . . . . . . . . . . . 47
9.23 Maximum Rate of Interest. . . . . . . . . . . . . . . . . . . . 47
9.24 Attorneys' Fees . . . . . . . . . . . . . . . . . . . . . . . . 47
9.25 Counterparts. . . . . . . . . . . . . . . . . . . . . . . . . . 47
9.26 Application of Payments . . . . . . . . . . . . . . . . . . . . 48
9.27 Assignments and Participations. . . . . . . . . . . . . . . . . 48
9.28 Setoff. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
9.29 Liability of Borrower's Trustees, etc.. . . . . . . . . . . . . 51
9.30 Employee Termination Expenses . . . . . . . . . . . . . . . . . 51
9.31 Conflicts with Intercreditor Agreement. . . . . . . . . . . . . 51
X. AGENT; SUCCESSOR AGENT . . . . . . . . . . . . . . . . . . . . . . . 52
10.1 Appointment . . . . . . . . . . . . . . . . . . . . . . . . . . 52
10.2 Powers and Duties; General Immunity . . . . . . . . . . . . . . 52
10.2.1 Powers; Duties. . . . . . . . . . . . . . . . . . . 52
10.2.2 Agent Entitled to Act as Lender . . . . . . . . . . 52
10.3 Representations and Warranties; No Responsibility for Appraisal
of Creditworthiness. . . . . . . . . . . . . . . . . . . . . . . . . 53
10.4 Successor Agent . . . . . . . . . . . . . . . . . . . . . . . . 53
XI. OFFERING . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54
11.1 Rights Offering . . . . . . . . . . . . . . . . . . . . . . . . 54
11.2 Consummation. . . . . . . . . . . . . . . . . . . . . . . . . . 54
11.3 Proceeds of Offering. . . . . . . . . . . . . . . . . . . . . . 54
11.4 Pricing of Rights Offering. . . . . . . . . . . . . . . . . . . 54
11.5 Waiver of Ownership Limitations . . . . . . . . . . . . . . . . 54
11.6 Indemnification . . . . . . . . . . . . . . . . . . . . . . . . 55
EXHIBITS
Exhibit A Form of Guaranty
Exhibit B Form of Notes
Exhibit C Form of Notice of Borrowing
Exhibit D Form of Assignment and Acceptance
SCHEDULES
Schedule 1.1 List of Prior Debt Documents
Schedule 2.1.1 Commitments; Lenders' Pro Rata Shares
Schedule 5.1.4 Pending and Threatened Litigation
Schedule 5.1.14 Annexes to Line of Credit Facility
FIXED RATE LOAN AGREEMENT
THIS FIXED RATE LOAN AGREEMENT, dated as of August 11, 1998 (as
amended, restated, replaced, supplemented or otherwise modified from time to
time, this "Agreement"), by and among BANKERS TRUST COMPANY, a New York
banking corporation ("Bankers"), having an address at ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇
▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, BANKBOSTON N.A., a national banking association, having
an address at ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇
▇▇▇▇▇, and WELLSFORD CAPITAL, a Maryland real estate investment trust, having
an address at ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ (together with their
successors and assigns hereunder, each a "Lender" and collectively, the
"Lenders"), BANKERS TRUST COMPANY, a New York banking corporation, as agent
(in such capacity, together with its successors and assigns hereunder,
"Agent"), having an address at ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇,
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, and FIRST UNION REAL ESTATE EQUITY AND MORTGAGE
INVESTMENTS, an Ohio real estate investment trust ("Borrower"), having an
address at ▇▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇.
All capitalized terms used herein shall have the respective
meanings set forth in Section 1.1 hereof.
W I T N E S S E T H :
- - - - - - - - - -
WHEREAS, Borrower desires to obtain the Loans from Lenders; and
WHEREAS, Lenders are willing to make the Loans to Borrower, sub-
ject to and in accordance with the terms of this Agreement.
NOW, THEREFORE, in consideration of the making of the Loans by
Lenders and the covenants, agreements, representations and warranties set
forth in this Agreement, the parties hereto hereby covenant, agree, represent
and warrant as follows:
I. DEFINITIONS; PRINCIPLES OF CONSTRUCTION
1.1 Definitions.
For all purposes of this Agreement, except as otherwise expressly
provided herein or unless the context clearly indicates a contrary intent:
"Advance" means an advance of a Loan made on or after the Closing
Date pursuant to and in accordance with Section 2.1.1 to be used exclusively
for the purposes described in Section 2.2.
"Affiliate" means, as to any Person, any other Person that,
directly or indirectly, is in control of, is controlled by, or is under
common control with, such Person or is a director, officer or trustee of such
Person or of an Affiliate of such Person. For purposes of this definition,
"control" of a person means the power, directly or indirectly, (i) to vote
ten percent (10%) or more of the securities having ordinary voting power for
the election of directors or trustees of such Person, or (ii) to direct or
cause the direction of the management and policies of such Person, whether by
contract or otherwise; provided that no Lender shall be deemed an Affiliate
of Borrower for purposes of this Agreement or any other Loan Document; and
that each of the entities included in the definition of Gotham are deemed to
be Affiliates of each other.
"Agent" has the meaning specified in the first Paragraph hereof.
"Assignment and Acceptance" shall mean an Assignment and
Acceptance in the form of Exhibit D and delivered pursuant to Section 9.27.
"Bankruptcy" means, with respect to any Person: (i) the
commencement by such Person of a proceeding seeking relief under any
provision or chapter of the Bankruptcy Code or any other federal or state law
relating to insolvency, bankruptcy or reorganization; (ii) an adjudication
that such Person is insolvent or bankrupt; (iii) the entry of an order for
relief under the Bankruptcy Code with respect to such Person; (iv) the filing
of any such petition or the commencement of any such case or proceeding
against such Person, unless such petition and the case or proceeding
initiated thereby are dismissed within sixty (60) days from the date of such
filing; (v) the filing of an answer by such Person admitting the material
allegations of any such petition; (vi) the appointment of a trustee, receiver
or custodian for all or substantially all of the assets of such Person unless
such appointment is vacated or dismissed by the earlier of sixty (60) days
from the date of such appointment and five (5) days before the proposed sale
of any assets of such Person; (vii) the execution by such Person of a general
assignment for the benefit of creditors; (viii) the convening by such Person
of a meeting of its creditors, or any class thereof, for purposes of
effecting a moratorium upon or composition of its debts or an extension of
its debts; (ix) the levy, attachment, execution or other seizure of
substantially all of the assets of such Person where such seizure is not
discharged within ten (10) days thereafter; or (x) the admission by such Per-
son in writing of its inability to pay its debts as they mature or that it is
generally not paying its debts as they become due.
"Bankruptcy Action" means, with respect to any Person: (i) commen-
cing any case, proceeding or other action seeking protection for such Person
as a debtor under any existing or future law of any jurisdiction relating to
bankruptcy, insolvency, reorganization or relief of debtors; (ii) consenting
to the entry of an order for relief in or institution of any case, proceeding
or other action brought by any third party against such Person as a debtor
under any existing or future law of any jurisdiction relating to bankruptcy,
insolvency, reorganization or relief of debtors; (iii) filing an answer in
any involuntary case or proceeding described in clause (ii) above admitting
the material allegations of the petition therein or otherwise failing to
contest any such involuntary case or proceeding; (iv) seeking or consenting
to the appointment of a receiver, liquidator, assignee, trustee,
sequestrator, custodian or any similar official for such Person or for a
substantial portion of its properties; (v) making any assignment for the
benefit of the creditors of such Person; or (vi) admitting in writing the
inability of such Person to generally pay its debts as they mature or that
such Person is generally not paying its debts as they become due.
"Bankruptcy Code" means Title 11 of the United States Code
entitled "Bankruptcy", as now and hereafter in effect, or any successor
statute.
"Borrower" has the meaning specified in the first Paragraph
hereof.
"Business Day" means any day excluding Saturday, Sunday and any
day which is a legal holiday under the laws of the State of New York, or
which is a day on which banking institutions located in any such jurisdiction
are authorized or required by law or other governmental action to close.
"Capital Event" means: (i) any sale, transfer, disposition,
conveyance or refinancing of all or any portion of any Property; (ii)
Casualty or Condemnation of all or any portion of any Property; (iii) the
acquisition, by purchase or otherwise, of any Property or other assets; (iv)
the issuance of any debt (other than the Indebtedness and other than under
the Imperial Credit Facility and/or the Line of Credit Facility, as each is
in effect on the date hereof) or equity securities by Borrower (including the
Offering); (v) the incurrence of any indebtedness (other than the Indebted-
ness and other than under the Imperial Credit Facility and/or the Line of
Credit Facility, as each is in effect on the date hereof) for borrowed money
by Borrower (other than purchase-money indebtedness); (vi) any transaction or
arrangement with any Person whereby Borrower shall sell or transfer any
Property and then or thereafter rent or lease back the same Property which it
intends to use for substantially the same purposes as the Property sold or
transferred; or (vii) any other event or occurrence which creates Capital
Event Proceeds.
"Capital Event Proceeds" means the net proceeds (i.e., the amounts
received as a result of a Capital Event exceeds the costs and expenses
incurred in such Capital Event) to Borrower from any Capital Event, including
but not limited to: (i) net proceeds from the sale, transfer, disposition,
conveyance or refinancing of all or any portion of any Property; (ii) Loss
Proceeds in respect of a Casualty or Condemnation of all or any portion of
the Properties, if such proceeds are not used to rebuild or restore such
Properties, or are not governed by another document in accordance with
Section 3.2.2; (iii) net proceeds from the issuance of any debt or equity
securities by Borrower; (iv) net proceeds from the incurrence of any
indebtedness for borrowed money by Borrower; or (v) any net proceeds from a
transaction or arrangement with any Person whereby Borrower shall sell or
transfer any Property and then or thereafter rent or lease back the same Pro-
perty which it intends to use for substantially the same purposes as the Pro-
perty sold or transferred; provided that all such proceeds shall be net of
reasonable out-of-pocket transaction costs and income or other taxes payable
by Borrower as a result of such Capital Event and, in the case of the sale or
other disposition of any Property, net of payment of any debt secured by such
Property or Properties.
"Casualty" means any damage to, or loss or destruction of, all or
any part of the Properties, whether or not such damage, loss or destruction
is insured or insurable.
"Casualty Insurance Proceeds" means insurance or other proceeds or
amounts paid or payable to or on behalf of Borrower in respect of a Casualty.
"Change in Control" means, with respect to Borrower, any of the
following events: (i) the acquisition, directly or indirectly, by any one
"person" (as such term is used in Section 13(d), and 14(d) of the Securities
and Exchange Act of 1934, as amended) of more than 10% of the common stock of
or other equity interests in Borrower; or (ii) during any period subsequent
to the date hereof, individuals who at the beginning of such period
constituted the Board of Trustees or Board of Directors of Borrower (together
with any new directors or trustees whose election or nomination for election
was approved by a vote of a majority of the directors or trustees then still
in office who were either directors at the beginning of such period or whose
election or nomination for election was previously so approved) cease for any
reason to constitute a majority of such Board of Directors or Board of
Trustees then in office; provided that neither the execution of the Standby
Purchase Agreements nor the purchase by the Standby Purchasers of any stock
pursuant to the Offering or the Standby Purchase Agreements shall be deemed
to cause a Change in Control and that any increase in the ownership by any
Standby Purchaser of any common stock or other equity interests in Borrower
shall not constitute a Change in Control.
"Closing Date" means the date of this Agreement.
"Commitments" means the commitments of Lenders to make Advances to
Borrower pursuant to Section 2.1.1.
"Commitment Fees" has the meaning specified in Section 2.7.
"Condemnation" means any actual or threatened taking, condemna-
tion, eminent domain or other similar proceeding relating to all or any
portion of any Property.
"Condemnation Proceeds" means any and all award proceeds and other
compensation payable in respect of a Condemnation.
"Control" of a Person means the power, whether or not exercised,
to direct the management of such Person, whether by possession of the power
to elect a majority of the Board of Directors or Board of Trustees or other-
wise.
"CPA" means a certified public accounting firm of recognized
national standing.
"Debt" means, with respect to any Person, without duplication,
(i) all indebtedness of such Person for borrowed money, (ii) all indebtedness
of such Person for the deferred purchase price of property or services (other
than indebtedness for property and services purchased in the ordinary course
of business that is payable and paid within sixty (60) days after delivery),
(iii) all obligations of such Person evidenced by notes, bonds, debentures or
other similar instruments (other than performance, surety and appeal bonds
arising in the ordinary course of business), (iv) all indebtedness of such
Person created or arising under any conditional sale or other title retention
agreement with respect to property acquired by such Person (even though the
rights and remedies of the seller or lender under such agreement in the event
of default are limited to repossession or sale of such property), (v) all
obligations of such Person under leases which have been or should be, in
accordance with GAAP, recorded as capital leases, (vi) all reimbursement,
payment or similar obligations of such Person, contingent or otherwise, under
acceptance, letter of credit or similar facilities (other than letters of
credit in support of trade obligations or in connection with workers' com-
pensation, unemployment insurance, old-age pensions and other social security
benefits in the ordinary course of business), (vii) all Debt (as defined in
clauses (i) through (vi) above) of another Person guaranteed directly or in-
directly by such Person, or in effect guaranteed directly or indirectly by
such Person through an agreement (A) to pay or purchase such Debt or to
advance or supply funds for the payment or purchase of such Debt, (B) to pur-
chase, sell or lease (as lessee or lessor) property, or to purchase or sell
services, primarily for the purpose of enabling the debtor to make payment of
such Debt or to assure the holder of such Debt against loss in respect of
such Debt, (C) to supply funds to or in any other manner invest in the debtor
(including any agreement to pay for property or services irrespective of
whether such property is received or such services are rendered) or
(D) otherwise to assure a creditor against loss in respect of such Debt, and
(viii) all Debt (as defined in clauses (i) through (vi) above) of another
Person secured by (or for which the holder of such Debt has an existing
right, contingent or otherwise, to be secured by) any lien, security interest
or other charge or encumbrance upon or in property (including accounts and
contract rights) owned by such Person, even though such Person has not
assumed or become liable for the payment of such Debt; excluding, however,
the endorsement of negotiable instruments or documents in the ordinary course
of business.
"Default" means the existence of a condition or the occurrence of
an event which, but for the giving of notice or passage of time, or both,
would be an Event of Default.
"Default Rate" means a rate per annum equal to the greater of the
Interest Rate plus four percent (4.0%) per annum and the Prime Lending Rate
plus four percent (4.0%) per annum.
"Defaulting Lender" shall have the meaning assigned to such term
in Section 2.8.3.
"▇▇▇▇▇▇▇" is a reference to ▇▇▇▇▇▇▇ Associates, L.P., a Delaware
limited partnership.
"Event of Default" has the meaning specified in Section 8.1.
"Extension Fee" has the meaning specified in Section 2.6.2.
"Final Commitment Date" means the date that is six (6) months from
the date on which the Closing Date occurs; provided that if the Final
Commitment Date occurs on a day which is not a Business Day, the Final
Commitment Date will fall on the next succeeding Business Day.
"Final Extension Maturity Date" has the meaning specified in
Section 2.6.1(b).
"Final Extension Notice" has the meaning specified in Section
2.6.1(b).
"Final Extension Option" has the meaning specified in Section
2.6.1(b).
"Fiscal Year" means each twelve month period commencing on Janu-
ary 1 and ending on December 31.
"FFO" means, for any Person, net income (computed in accordance
with GAAP), excluding gains (or losses) from restructuring and sales of pro-
perty, plus depreciation of real property, and after adjustments for
unconsolidated entities in which such Person holds an interest.
"Funding Date" means the date of the funding of an Advance.
"GAAP" means generally accepted accounting principles in the
United States of America as of the date of the applicable financial report.
"Gotham" is a reference to Gotham Partners, L.P., a New York
limited partnership, and Gotham Partners III, L.P., a New York limited
partnership, and each reference herein to Gotham, including to Gotham as a
Standby Purchaser, shall be deemed to be a reference to all of such entities
or to both of such entities, as the context requires.
"Governmental Authority" means any legislative body, court, board,
agency, commission, office or authority of any nature whatsoever of or for
any governmental ▇▇▇▇ (▇▇▇▇▇▇▇, ▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇ or
otherwise) whether now or hereafter in existence.
"Guarantors" means any Person which hereafter becomes a Guarantor
pursuant to Section 7.20 of the Line of Credit Facility (as incorporated
herein).
"Guaranty" means each guaranty, substantially in the form attached
hereto as Exhibit A, hereafter executed by a Guarantor in favor of Lenders,
as the same may be amended, restated, replaced, supplemented or otherwise
modified from time to time.
"Imperial Credit Facility" means the credit facility governed by
(i) that certain Amended and Restated Credit Agreement dated as of April 17,
1997 among Imperial Parking Limited, 504463 N.B. Inc., the lenders named
therein, and BT Bank of Canada, and (ii) that certain Ancillary Agreement
dated April 17, 1997 among BT Bank of Canada, Hongkong Bank of Canada and
Borrower; both as amended, restated, replaced, supplemented or otherwise
modified, and as more specifically described on Schedule 1.1 hereto.
"Indebtedness" means the indebtedness evidenced by the Notes,
together with all other obligations and liabilities of Borrower due or to
become due to Lenders pursuant hereto in respect of the Loans, under the
Notes or in accordance with any of the other Loan Documents, all amounts,
sums and expenses paid by or payable or reimbursable to Lenders hereunder in
respect of the Loans or pursuant to the Notes or any of the other Loan Docu-
ments, and all other covenants, obligations and liabilities of Borrower here-
under in respect of the Loans or pursuant to the Notes or any of the other
Loan Documents, together with all interest thereon (including, if and when
applicable, interest at the Default Rate as provided in this Agreement and in
the Notes).
"Indemnified Liabilities" has the meaning specified in
Section 9.14.
"Indemnitees" means, collectively, Agent, Lenders and their
successors and assigns, and its and their respective officers, directors,
agents (including any servicer of the Loans), employees, parents, Affiliates
and Subsidiaries.
"Independent" means a Person who (i) is in fact independent,
(ii) does not have any direct financial interest or any material indirect
financial interest in Borrower or in any Affiliate of Borrower or any
constituent partner of Borrower, and (iii) is not connected with Borrower or
any Affiliate of Borrower or any constituent partner of Borrower as an
officer, employee, promoter, underwriter, trustee, partner, director or per-
son performing similar functions. Whenever it is herein provided that any
Independent Person's opinion or certificate shall be provided, such opinion
or certificate shall state that the Person executing the same has read this
definition and is Independent within the meaning hereof.
"Initial Extension Maturity Date" has the meaning specified in
Section 2.6.1(a).
"Initial Extension Notice" has the meaning specified in Section
2.6.1(a).
"Initial Extension Option" has the meaning specified in Section
2.6.1(a).
"Initial Maturity Date" means the day that is six (6) months from
the date on which the Closing Date occurs; provided that if the Initial
Maturity Date occurs on a day which is not a Business Day, the Initial
Maturity Date will fall on the next succeeding Business Day.
"Intercreditor Agreement" shall mean that certain Intercreditor
Agreement of even date herewith by and among the parties to this Agreement
and the parties to the Other Loan Agreement, as the same may be amended or
otherwise modified from time to time.
"Interest Payment Date" means, for any Interest Period, the date
that is the last day of such Interest Period; provided, however, that if such
day is not a Business Day, the Interest Payment Date for such Interest Period
shall occur on the next succeeding Business Day.
"Interest Period" means each calendar month during the term of the
Loans; provided that:
(a) the initial Interest Period shall commence on (and include)
the Closing Date and shall end on (and include) the last day of the
calendar month in which the Closing Date occurs; and
(b) the final Interest Period shall end on (and include) the
last day of the calendar month in which the Initial Maturity Date
occurs (or, if applicable, the Initial Extension Maturity Date or Final
Extension Maturity Date).
"Interest Rate" means a rate of interest equal to nine and seven-
eighths percent (9.875%) per annum.
"Internal Revenue Code" means 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.
"Legal Requirements" means all federal, state, county, municipal
and other governmental statutes, laws, rules, orders, regulations,
ordinances, judgments, decrees and injunctions of any Governmental Authority
(including Environmental Laws) affecting Borrower or any Property or any part
thereof, whether now or hereafter enacted and in force.
"Lenders" has the meaning specified in the first Paragraph hereof,
and shall, as the context may require, include any servicer appointed by
Lenders for the purpose of servicing the Loans.
"Lender Approval" means the written approval of the Required Len-
ders. Lender Approval or approval by the Required Lenders, except as other-
wise herein provided, may be granted or withheld in the sole and absolute
discretion of such required percentage of Lenders hereunder.
"Lending Installation" means any office or branch of any Lender.
"Lien" means any mortgage, deed of trust, lien, pledge, hypothe-
cation, assignment, security interest, security title, or any other encum-
brance, charge or collateral transfer of, on or affecting the Properties of
Borrower or any portion thereof or any interest therein, including 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.
"Line of Credit Facility" means the $125,000,000.00 credit
facility governed by that certain Amended and Restated Credit Agreement dated
as of November 1, 1997 among Borrower, Manager, the lenders named therein,
Keybank National Association, Bankers Trust Company, and National City Bank,
as amended, restated, replaced, supplemented or otherwise modified, and as
more specifically described on Schedule 1.1 hereto.
"Loan Documents" means collectively, this Agreement, the Notes,
the Guaranty, the Standby Purchase Agreements and any other document or
instrument executed and delivered by Borrower or any other Person to Agent or
any Lender evidencing, governing, securing or otherwise relating to the
Loans, in each case, as amended, restated, replaced, supplemented or other-
wise modified from time to time.
"Loans" means the fixed rate unsecured loans evidenced by the
Notes and governed by the Loan Documents, to be made in Advances by Lenders
to Borrower pursuant hereto.
"Loss Proceeds" means Casualty Insurance Proceeds and/or Condemna-
tion Proceeds, as the context may require.
"Loss Proceeds Account" has the meaning specified in Section 3.1.
"Manager" means First Union Management, Inc., a Delaware
corporation.
"Material Adverse Effect" means any circumstance, act, condition
or event of whatever nature (including any adverse determination in any
litigation, arbitration, or governmental investigation or proceeding),
whether singly or in conjunction with any other event or events, act or acts,
condition or conditions, or circumstance or circumstances, whether or not
related, that does, or could reasonably be expected to, (i) result in a
materially adverse change in or have a materially adverse effect upon the
business, operations or condition (financial or otherwise) of Borrower or any
Standby Purchaser, as the case may be, or (ii) result in the material
impairment of the ability of Borrower or any Standby Purchaser to perform, or
of Lenders to enforce, the obligations of Borrower or such Standby Purchaser
under the Loan Documents to which it is a party, or any of them.
"Maximum Rate" has the meaning specified in Section 9.23.
"Notes" means those certain Notes of even date herewith, in each
case made by Borrower in favor of a Lender, substantially in the form of
Exhibit B, as the same may be amended, restated, replaced, supplemented or
otherwise modified from time to time.
"Notice of Borrowing" means a notice substantially in the form
attached hereto as Exhibit C, delivered by Borrower to Agent pursuant to
Section 2.1.2 with respect to a proposed borrowing hereunder.
"Offering" has the meaning specified in Section 11.1.
"Officer's Certificate" means a certificate delivered to Agent by
Borrower which is signed by an authorized officer of Borrower.
"Organizational Documents" means, with respect to any Person, (a)
if such Person is a limited partnership, the limited partnership agreement of
such Person and the certificate of limited partnership of such person, in
each case, as amended, restated, supplemented or otherwise modified from time
to time, (b) if such Person is a corporation, the certificate or articles of
incorporation of such Person and the by-laws of such Person, in each case, as
amended, restated, supplemented or otherwise modified from time to time, (c)
if such Person is a limited liability company, the certificate of formation
(or equivalent document) and the operating agreement of such Person, as
amended, restated, supplemented or otherwise modified from time to time, (d)
if such person is a trust, the trust agreement of such Person, as amended,
restated, supplemented or otherwise modified from time to time, and (e) if
such Person is a general partnership, the partnership agreement of such Per-
son, as amended, restated, supplemented or otherwise modified from time to
time. If a Person is an individual, there are no Organizational Documents
for such Person.
"Other Loan Agreement" shall mean that certain Fixed Rate Loan
Agreement of even date herewith by and among Borrower, as borrower, Gotham,
Blackacre Bridge Capital, L.L.C. and ▇▇▇▇▇▇▇, as lenders, and Bankers Trust
Company, as Agent.
"Other Loans" means the "Loans," as defined in the Other Loan
Agreement.
"Paired Trust" means an Ohio trust created for the benefit of the
shareholders of Borrower, which trust holds all of the shares of Manager.
"Participant" means any participant in any obligations of Borrower
hereunder.
"Performing Lenders" shall have the meaning assigned to such term
in Section 2.8.2.
"Person" means any individual, corporation, general partnership,
limited partnership, limited liability company, limited liability partner-
ship, joint venture, estate, trust, unincorporated association, or other
organization, whether or not a legal 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.
"Policies" has the meaning specified in Section 6.1.22(c).
"Pre-Closing Documentation" has the meaning specified in Sec-
tion 10.3.
"Prime Lending Rate" shall mean the "Prime Rate" reported by The
Wall Street Journal (Eastern Edition) from time to time; provided, however,
if at any time more than one Prime Rate is reported by The Wall Street
Journal, the Prime Lending Rate shall mean the rate which Agent announces
from time to time as its prime lending rate, in effect from time to time.
The Prime Lending Rate shall change as of the date of each change in the
Prime Rate. If, during any period that any portion of the Loans are out-
standing, The Wall Street Journal no longer publishes a "Prime Rate", the
Prime Lending Rate shall mean the rate which Agent announces from time to
time as its prime lending rate, in effect from time to time. The Prime
Lending Rate is a reference rate and does not necessarily represent the
lowest or best rate actually charged to any customer. Lenders may make
commercial or other loans at rates of interest at, above or below the Prime
Lending Rate.
"Prior Debt Documents" means the documents evidencing, governing,
securing or otherwise relating to any outstanding Debt of Borrower as of the
Closing Date other than the Indebtedness, including Debt pursuant to the
Senior Notes, the Line of Credit Facility and the Imperial Credit Facility.
The Prior Debt Documents shall include (but shall not be limited to) the
instruments listed on Schedule 1.1 hereto.
"Properties" means, collectively, the parcels of real property
from time to time owned or leased by Borrower and all improvements thereon,
together with all rights pertaining to such property and improvements.
"Pro Rata Share" means with respect to each Lender, the percentage
obtained by dividing (i) as of any date of determination prior to the
termination of the Commitments (a) that Lender's Commitment by (b) the sum of
the aggregate Commitments of all Lenders and (ii) as of any date of
determination after the termination of the Commitments, (A) the aggregate
principal amount of such Lender's outstanding Advances by (B) the sum of the
aggregate principal amount of all outstanding Advances.
"Register" has the meaning specified in Section 2.1.5(a).
"REIT" means a real estate investment trust as defined in Section
856 of the Internal Revenue Code.
"Required Lenders" shall mean Lenders holding a 66 2/3% or greater
share of the outstanding Loans or, if no Loans are outstanding, Lenders
holding a 66 2/3% or greater share of the Commitments.
"Securities and Exchange Commission" means the United States
Securities and Exchange Commission or any successor thereto.
"Senior Notes" means those certain 8 and 7/8% Senior Notes due
2003 issued by Borrower pursuant to that certain Indenture dated as of
October 1, 1993 from Borrower to Society National Bank , as amended,
restated, replaced, supplemented or otherwise modified, and as more
specifically described on Schedule 1.1 hereto.
"Standby Purchase Agreements" shall mean each of the Standby Stock
Purchase Agreements of even date herewith made by and between a Standby Pur-
chaser and Borrower and acknowledged and agreed to by Agent, as the same may
be amended or otherwise modified from time to time.
"Standby Purchaser" means each of ▇▇▇▇▇▇▇ and Gotham.
"Subsidiary" means, with respect to any Person, any corporation,
partnership, limited liability company, trust or other entity of which at
least a majority of the securities or other ownership interests having by
their terms ordinary voting power to elect a majority of the Board of
Directors or Board of Trustees or other individuals performing similar
functions of such corporation, partnership, limited liability company, trust
or other entity (irrespective of whether or not at the time securities or
other ownership interests of any other class or classes of such corporation,
partnership, limited liability company, trust or other entity shall have or
might have voting power by reason of the happening of any contingency) is at
the time directly or indirectly owned or controlled by such Person and/or one
or more Subsidiaries of such Person, and any partnership or limited liability
company in which such Person or any such Subsidiary is a general partner or
managing member.
"Tax" means any present or future tax, levy, impost, duty, charge,
fee, assessment, imposition, deduction or withholding of any nature and
whatever called, by any Governmental Authority, on whomsoever and wherever
imposed, levied, collected, withheld or assessed.
"Work" has the meaning specified in Section 3.2.1(d)(i).
1.2 Principles of Construction.
All references to sections, schedules and exhibits are to sec-
tions, schedules and exhibits 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. The words and phrases "including," "shall include,"
"inclusive of" and words and phrases of similar import shall be deemed to be
followed by "without limitation" or "but not limited to". 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.
All accounting terms not specifically defined herein shall be construed in
accordance with GAAP, as modified herein.
II. GENERAL TERMS
2.1 Commitments; Advances; Notes; the Register.
2.1.1 Commitments. Subject to and upon the terms and
conditions set forth herein, each Lender hereby severally agrees to lend to
Borrower from time to time during the period from the Closing Date to and
including the Final Commitment Date an aggregate amount not exceeding such
Lender's Pro Rata Share of the aggregate amount of the Commitments; provided,
however, that notwithstanding anything herein to the contrary, any amount
borrowed and repaid hereunder cannot be reborrowed. Borrower agrees that for
so long as Advances are available hereunder Borrower will not borrow under
the Other Loan Agreement. The original amount of each Lender's Commitment
and such Lender's original Pro Rata Share is set forth opposite its name on
Schedule 2.1.1 annexed hereto and the aggregate original amount of the
Commitments is Forty-five Million Dollars ($45,000,000.00). Borrower shall
use the proceeds of all Loans for the purposes identified in Section 2.2.
Each Lender's Commitment shall expire on the Final Commitment Date
and all Advances and all other amounts owed hereunder with respect to the
Loans and the Commitments shall be paid in full no later than the Initial
Maturity Date (or, if the term of the Loans is extended pursuant to Section
2.6, the Initial Extension Maturity Date or the Final Extension Maturity
Date, as the case may be).
2.1.2 Borrowing Mechanics. Advances made on any Funding Date
shall be in an aggregate minimum amount of Five Million Dollars
($5,000,000.00). Whenever Borrower desires that Lenders make Advances, it
shall deliver to Agent a Notice of Borrowing no later than 10:00 A.M. (New
York time) at least three Business Days in advance of the proposed Funding
Date.
Each Notice of Borrowing shall specify (i) the proposed Funding
Date (which shall be a Business Day), (ii) the amount of the Advances
requested, (iii) the account to which the Advances shall be wired, and (iv)
that no other Funding Date shall have occurred within the 30 days immediately
preceding the proposed Funding Date.
Borrower may give Agent telephonic notice by the required time of
any proposed Advances under this Section 2.1.2; provided, however, that such
notice shall be promptly confirmed in writing by delivery of a Notice of
Borrowing to Agent on or before the applicable Funding Date. Neither Agent
nor any Lender shall incur any liability to Borrower in acting upon any
telephonic notice referred to above that Agent believes in good faith to have
been given by a duly authorized officer or other Person authorized to borrow
on behalf of Borrower or for otherwise acting in good faith under this Sec-
tion 2.1.2, and upon funding of Advances by Lenders in accordance with this
Agreement pursuant to any such telephonic notice Borrower shall have effected
Advances hereunder.
Borrower shall notify Agent (who shall notify Lenders) prior to
the funding of any Advances in the event that any of the matters to which
Borrower is required to certify in the applicable Notice of Borrowing is no
longer true and correct as of the applicable Funding Date, and the acceptance
by Borrower of the proceeds of any Advances shall constitute a re-
certification by Borrower, as of the applicable Funding Date, as to the
matters to which Borrower is required to certify in the applicable Notice of
Borrowing.
2.1.3 Disbursement of Funds. All Advances under this Agree-
ment shall be made by Lenders simultaneously and proportionately to their
respective Pro Rata Shares, it being understood that no Lender shall be
responsible for any default by any other Lender in that other Lender's
obligation to make Advances requested hereunder nor shall the Commitment of
any Lender be increased or decreased as a result of a default by any other
Lender in that other Lender's obligation to make Advances requested hereun-
der. Promptly after receipt by Agent of a Notice of Borrowing pursuant to
Section 2.1.2 (or telephonic notice in lieu thereof), Agent shall notify each
Lender of the proposed Advances. Provided that Lenders have received at
least one (1) Business Day notice of the requested Advance, each Lender shall
make its Pro Rata Share of the aggregate amount of the Advances requested in
such Notice of Borrowing or telephonic notice, as the case may be, available
to Agent, in same day funds, at the office of Agent located at ▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇, not later than 12:00 Noon (New York time) on the
applicable Funding Date. Upon satisfaction of the conditions precedent
specified in Section 4.1 and 4.2 (in the case of Advances made on the
Closing Date) and Section 4.2 (in the case of all Advances), Agent shall make
the proceeds of such Advances available to Borrower on the applicable Funding
Date by causing an amount of same day funds equal to the proceeds of all such
Advances received by Agent from Lenders to be transferred to the account
designated in the Notice of Borrowing or telephonic notice, as the case may
be.
2.1.4 Notes. The Commitments and Loans shall be evidenced by
the Notes of Borrower, each in the original principal amount of the
respective Loan and having an initial maturity date of Initial Maturity Date.
The Notes shall bear interest as provided in Section 2.4 and shall be subject
to repayment and prepayment as provided in Section 2.3. The Notes shall be
entitled to the benefits of this Agreement.
2.1.5 The Register.
(a) Agent shall maintain, at its address referred to in
this Agreement, a register for the recordation of the names and
addresses of Lenders and the Commitment and Advances of each Lender
from time to time (the "Register"). For all purposes of this
Agreement, Borrower, Agent and Lenders may treat as a Lender hereunder
each Person whose name is recorded in the Register as a Lender hereun-
der. The Register shall be available for inspection by Borrower or any
Lender at any reasonable time and from time to time upon reasonable
prior notice.
(b) Agent shall record in the Register the Commitment and
the Advances from time to time of each Lender, and each repayment or
prepayment in respect of the principal amount of the Advances of each
Lender. Any such recordation shall be prima facie evidence of such
matters as against Borrower and each Lender, absent manifest error;
provided, however, that failure to make any such recordation, or any
error in such recordation, shall not affect Borrower's obligations in
respect of the applicable Loans.
(c) Each Lender shall record on its internal records
(including the Notes described in Section 2.1.4) the amount of each
Advance made by it and each payment in respect thereof. Any such
recordation shall be prima facie evidence of such matters as against
Borrower absent manifest error; provided, however, that failure to make
any such recordation, or any error in such recordation, shall not
affect Borrower's obligations in respect of the applicable Loans.
2.2 Use of Proceeds.
Borrower shall use the proceeds of the Loans only for the purposes
of repurchasing outstanding Senior Notes and the payment of actual out-of-
pocket costs incurred by Borrower in connection therewith, and for no other
purpose.
2.3 Loan Repayments and Prepayments.
2.3.1 Repayments. Subject to Section 2.6 hereof, Borrower
shall repay the then outstanding principal amount of the Loans in full on the
Initial Maturity Date, together with interest thereon through (and including)
the last day of the final Interest Period.
2.3.2 Mandatory Prepayments of the Loans. Subject to the
terms and provisions of the Intercreditor Agreement, the Loans and the Other
Loans are subject to mandatory partial or full prepayment (together with
interest on the amount prepaid), on a pro-rata basis, with one hundred
percent (100%) of all Capital Event Proceeds within two (2) Business Days
after the date Borrower receives such Capital Event Proceeds; provided that
Loss Proceeds shall be applied to such mandatory prepayment only to the
extent such Loss Proceeds are not applied to rebuild or restore Properties
that were the subject of the Casualty or Condemnation with respect to which
such Loss Proceeds were received. However, to the extent such Loss Proceeds
become available for prepayment during the Lock-Out Period (defined below),
such prepayment shall be made immediately following the Lock-Out Period.
2.3.3 Voluntary Prepayments of the Loans. Subject to the
terms and provisions of the Intercreditor Agreement, Borrower may, at any
time, upon not less than two (2) days' prior written notice to Agent, prepay
the Loans, in whole or in part, together with interest on the outstanding
principal amount of the Loans being prepaid to (and including) the day in
which the prepayment occurs, such amount of interest and principal to be
applied to the Loans pro rata in accordance with the respective outstanding
principal balances of the Loans; provided, however, that any Loan which is
prepaid (including with the proceeds of the Offering) within ninety (90) days
(the "Lock-Out Period") of being advanced shall be accompanied by a prepay-
ment premium of (i) if the prepayment occurs on or before thirty (30) days
after being advanced, three percent (3%) of the amount prepaid; (ii) if the
prepayment occurs on or after thirty-one (31) days to and including sixty
(60) days of being advanced, two percent (2%) of the amount prepaid; and
(iii) if the prepayment occurs on or after sixty-one (61) days to and
including ninety (90) days of being advanced, one percent (1%) of the amount
prepaid. Each notice of prepayment of the Loans shall be irrevocable and
shall specify (i) the prepayment date and (ii) the amount of prepayment.
2.3.4 Not A Revolver. This Agreement does not provide for
revolving loans. Accordingly, amounts repaid or prepaid may not be
reborrowed.
2.4 Interest.
2.4.1 Generally. The outstanding principal amount of the
Loans shall bear interest at a rate per annum equal to the Interest Rate.
2.4.2 Interest Payments. Subject to the provisions of Sec-
tion 2.4.3, interest on the outstanding principal balance of the Loans shall
be payable (a) for any Interest Period other than the final Interest Period,
on the Interest Payment Date for such Interest Period, (b) upon any prepay-
ment of the Loans (to the extent accrued on the amount being prepaid), in
accordance with Section 2.3, and (c) for the final Interest Period, on the
Initial Maturity Date (or, if the term of the Loans is extended pursuant to
Section 2.6, the Initial Extension Maturity Date or Final Extension Maturity
Date, as applicable).
2.4.3 Default Rate; Post-Maturity Interest. If Borrower
shall default in the payment of principal of or interest on the Loans, or any
fees or other amounts owed by Borrower under this Agreement or any other Loan
Documents shall not be paid when due, then the outstanding principal amount
of the Loans and, to the extent permitted by applicable law, any interest
payments thereon not paid when due and any fees and other amounts then due
and payable under this Agreement or any other Loan Document shall thereafter
bear interest (including post-petition interest in any proceeding under the
Bankruptcy Code or any other now existing or future applicable bankruptcy,
insolvency or other similar laws) payable upon demand at the Default Rate.
Payment or acceptance of the increased rates provided for in this subsection
is not a permitted alternative to timely payment and shall not constitute a
waiver of any Default or Event of Default or an amendment to this Agreement
or any other Loan Document and shall not otherwise prejudice or limit any
rights or remedies of Lenders.
2.5 Payments; Computations.
2.5.1 Making of Payments. Each payment by Borrower hereunder
or under the Notes shall be made to Agent by deposit to such account as Agent
may have last designated by written notice to Borrower. Payments received
after 2:00 p.m., New York City time, shall be deemed to have been received on
the next Business Day. Whenever any payment hereunder or under the Notes
shall be stated to be due on a day that is not a Business Day and an
alternative payment date is not otherwise provided for, such payment shall be
made on the next Business Day, with interest thereon to the date of payment.
Immediately after receipt of payment, Agent will distribute to each Lender
its Pro Rata Share of each such payment received by Agent for the account of
Lenders.
2.5.2 Computation of Interest. Interest on the Loans shall
be computed on the basis of a 360-day year, based on the actual number of
days expired in any given Interest Period. In computing interest on the
Loans, the first day of an Interest Period and the last day of such Interest
Period shall be included.
2.5.3 Capital Adequacy Adjustment. If any Lender shall have
determined that the adoption, effectiveness, phase-in or applicability of any
law, rule or regulation (or any provision thereof) regarding capital
adequacy, or any change therein or in the interpretation or administration
thereof by any Governmental Authority, central bank or comparable agency
charged with the interpretation or administration thereof, or compliance with
any guideline, request or directive regarding capital adequacy (whether or
not having the force of law) of any such Governmental Authority, central bank
or comparable agency, in any case occurring or arising after the date hereof,
has or would have the effect of reducing the rate of return on the capital of
such Lender or any corporation controlling such Lender as a consequence of,
or with reference to, the Loans or other obligations hereunder to a level
below that which such Lender or such controlling corporation could have
achieved but for such adoption, effectiveness, phase-in, applicability,
change or compliance (taking into consideration the policies of such Lender
or such controlling corporation with regard to capital adequacy), then from
time to time, within five (5) Business Days after receipt by Borrower from
Agent on behalf of such Lender of the statement referred to in the next
sentence, Borrower shall pay to Agent on behalf of such Lender such addition-
al amount or amounts as will compensate such Lender or such controlling cor-
poration on an after-tax basis for such reduction. Agent on behalf of such
Lender shall deliver to Borrower a written statement, setting forth in
reasonable detail the basis of the calculation of such additional amounts,
which statement shall be conclusive and binding upon all parties hereto
absent manifest error.
2.6 Extension of Loan Term.
2.6.1 Extension Option. Subject to the satisfaction of each
of the conditions set forth in Section 2.6.2:
(a) Borrower shall have the option (the "Initial Extension
Option"), exercisable by notice (the "Initial Extension Notice") to
Agent given at least ten (10) Business Days prior to the Initial
Maturity Date, time being of the essence, to extend the maturity of the
Loans until the date three (3) months following the Initial Maturity
Date (the "Initial Extension Maturity Date").
(b) If Borrower shall have exercised the Initial Extension
Option, then Borrower shall have the option (the "Final Extension
Option"), exercisable by notice (the "Final Extension Notice") to Agent
given at least ten (10) Business Days prior to the Initial Extension
Maturity Date, time being of the essence, to extend the maturity of the
Loans until the date three (3) months following the Initial Extension
Maturity Date (the "Final Extension Maturity Date").
2.6.2 Conditions to Extend. Borrower's right to extend the
term of the Loan shall be conditioned upon the satisfaction of the following
conditions precedent as of the date on which the Initial Extension Notice or
Final Extension Notice, as applicable, is provided to Agent, and as of the
Initial Maturity Date or the Initial Extension Maturity Date, as applicable:
(a) no monetary Default, material non-monetary Default or
Event of Default shall have occurred and be continuing (and any
extension shall not be deemed a waiver of a Default of any type); and
(b) Borrower shall pay to Agent (to be distributed pro rata
among Lenders in accordance with the outstanding principal balances of
the Loans) on each of the dates on which the Initial Extension Notice
and Final Extension Notice, as applicable, is provided to Agent a non-
refundable extension fee of $225,000 (each, an "Extension Fee").
2.7 Commitment and Other Fees.
Borrower agrees to pay to each Lender on the Closing Date a non-
refundable commitment fee (each a "Commitment Fee" and collectively the "Com-
mitment Fees") in an amount equal to one and one-half percent (1.5%) of the
principal amount of the Commitment made by such Lender to Borrower pursuant
to this Agreement. Pursuant to a separate agreement with Borrower, upon the
Closing Date Borrower is paying Agent a non-refundable Agent's fee.
2.8 Agent Reliance; Defaulting Lenders.
2.8.1 Agent Reliance. Unless Agent shall have been notified
in writing by any Lender prior to the date of an Advance that such Lender
does not intend to make available to Agent such Lender's pro rata share of
the Advance to be made on such date, Agent may assume that such Lender has
made such amount available to Agent on such date, and Agent may make
available to Borrower a corresponding amount. If such corresponding amount
is not in fact made available to Agent by such Lender on the date of such
Advance, Agent shall have no obligation to make such corresponding amount
available to the Borrower. If Agent has made such funds available to
Borrower and such Lender does not pay such corresponding amount upon Agent's
demand therefor, Agent may at any time thereafter so notify Borrower and Bor-
rower shall immediately upon Agent's demand therefor pay to Agent such
corresponding amount together with interest thereon, for each day from such
Funding Date until the date such amount is paid to Agent, at the Interest
Rate.
2.8.2 Defaulting Lenders. To the extent that a Lender fails
to make any Advance when required hereunder and one or more of the other
Lenders ("Performing Lenders") makes such Advance in such amounts as they may
agree upon (although none of Lenders or Agent shall have any obligation to
make any such Advance), then, without otherwise limiting any rights and
remedies in such situation, Defaulting Lender shall pay to Lenders which per-
formed Defaulting Lender's obligations (x) interest on such amount at a rate
equal to such Performing Lender's cost of funds for the related Loan which
Performing Lenders made to Borrower as a result of such Defaulting Lender's
failure to effect the related Advance and (y) a pro-rata portion of the fees
paid to Defaulting Lender by Borrower as set forth in Section 2.7, with such
pro-rata portion to be calculated by amortizing such fees on a straight-line
basis (over the then scheduled term of the Loan) and allocating to Performing
Lenders, with respect to the period they performed on behalf of the
Defaulting Lender, the fees allocable to the amount so advanced by Performing
Lenders on behalf of Defaulting Lender. Such interest shall accrue and be
payable from the date the Performing Lender(s) made a loan to Borrower on
behalf of the Defaulting Lender(s) until such payment is made by the
Defaulting Lender(s) to the Performing Lender(s). If Defaulting Lender makes
the payment which it theretofore failed to make and pays Performing Lender
the interest and fees described in this Section, then Defaulting Lender shall
be deemed to have made the Advance when the same was originally due.
2.8.3 Subordination of Defaulting Lenders. If a Lender
fails, when required hereunder, to make any Advance or fails to pay any sum
payable to Agent hereunder and such default continues for five (5) days after
written notice by Agent to such Lender, then such Lender's (the "Defaulting
Lender") share in the Loans and the Loan Documents and proceeds thereof shall
be immediately subordinated to the other Lenders' and Agent's share therein
and proceeds thereof, and such Defaulting Lender's Commitment and Loans shall
be voted by Agent, all without necessity for executing any further documents.
Upon such failure, in addition to Agent's other legal and equitable rights
and remedies, Agent shall withhold and apply any and all amounts payable to
such Defaulting Lender under the Loan Documents in such order of priority as
Agent shall determine in its sole discretion to: (i) purchase for the
Defaulting Lender its share of any Loan or pay any sum payable hereunder that
Defaulting Lender was obligated but failed to pay pursuant to this Agreement;
and/or (ii) reimburse Performing Lenders and/or Agent for any other sums,
costs, expenses or disbursements payable by Defaulting Lender hereunder.
Upon actual payment by Defaulting Lender of its late Commitment percentage of
the Loans and any other sums then payable by Defaulting Lender under the Loan
Documents, its share in the Loans and in the Loan Documents and proceeds
thereof and its Commitment and Loan thereupon shall immediately be restored
to equal priority with that of the other Lenders, but these provisions shall
not effect a rescission of any exercise by Agent of any vote of Defaulting
Lender's Commitment and Loans.
2.9 Lending Installations.
Each Lender may book Loans at one or more Lending Installations
selected by it from time to time, and may change its Lending Installations
from time to time, but no such selection or change shall affect the liability
of the Lender making any such selection or change. All terms of this
Agreement and of the other Loan Documents shall apply to any such Lending
Installation as if it were a Lender hereunder, and, if a Lender so selects
Lending Installation(s), this Agreement shall be deemed held by such Lender
for the benefit of its selected Lending Installation(s).
2.10 Withholding.
All payments by Borrower shall be paid in full without setoff or
counterclaim and without reduction for and free from any and all Taxes;
provided, however, that in the event Borrower shall be required by law to
deduct or withhold Taxes from interest, fees or other amounts payable hereun-
der or under any of the other Loan Documents, Borrower shall be entitled to
do so without being in Default hereunder provided that Borrower, together
with such payment, shall provide a statement to Agent and Lenders setting
forth the amount of Taxes deducted or withheld, the applicable rate, an
official receipt or other evidence of payment satisfactory to the applicable
Lender and any other information or documentation which may reasonably be
requested for the purpose of assisting the Person(s) from whom Taxes were
deducted or withheld to obtain any allowable credits or deductions for the
Taxes so deducted or withheld in each jurisdiction in which said Person(s)
are subject to tax. Notwithstanding the foregoing, however, Borrower shall
not deduct or withhold Taxes from amounts payable to or for the benefit of a
Person entitled to payments hereunder whose percentage interest in the oblig-
ations of Borrower has been disclosed to Borrower (either in writing or by a
document to which such Person, any Lender or Borrower is a signatory) (or, in
the event that any Taxes are required by law to be deducted or withheld from
payments hereunder to any such Person, Borrower shall pay to such Person such
additional amount as is necessary to ensure that the net amount actually
received by such Person will equal the full amount such Person would have
received had no such deduction or withholding been required), (i) if such
Person is created or organized under the laws of the United States or any
state thereof or (ii) to the extent that Borrower would be permitted to make
such payments to such Person free of such deductions or withholdings as of
the Closing Date or the date such Person otherwise acquires an interest in
the obligations of Borrower hereunder; provided that if at the date a Person
becomes a party hereto the applicable transferor or assignor was entitled to
additional amounts under this Section 2.10, then to such extent the assignee
or transferee shall also be entitled to additional amounts hereunder. A
Lender organized in a jurisdiction other than the United States or a
political subdivision thereof shall not be entitled to receive additional
amounts under this Section 2.10 to the extent that a withholding tax is
imposed due to a failure to comply with the provisions of Section 9.27(f)
hereof. The percentage interest in the obligations of Borrower hereunder of
each such Person shall equal the percentage participation in such obligations
of such Person as so disclosed to Borrower from time to time. Borrower shall
also pay any present or future stamp or documentary taxes or any other Taxes
imposed on Agent or any Lender that arise from any payment hereunder or from
the execution, delivery or registration of or otherwise with respect to this
Agreement.
2.11 Sharing of Payments, Etc.
If any Lender shall obtain any payment or reduction (including,
without limitation, any amounts received as adequate protection of a deposit
treated as cash collateral under the Bankruptcy Code) of any obligation of
Borrower hereunder in respect of the Loans or in respect of any other obliga-
tions of Borrower under any of the Loan Documents (whether voluntary,
involuntary, through the exercise of any right of set-off, or otherwise) in
excess of its Pro Rata Share of payments or reductions on account of the
Loans or such other obligations obtained by all Lenders, such Lender shall
forthwith (i) notify each of the other Lenders and Agent of such receipt, and
(ii) purchase from the other Lenders, without recourse, such participations
in the affected obligations owned by the selling Lenders as shall be
necessary to cause such purchasing Lenders to share the excess payment or
reduction, net of costs incurred in connection therewith, ratably with each
of them, provided that if all or any portion of such excess payment or
reduction is thereafter recovered from such purchasing Lenders, or additional
costs are incurred, the purchase shall be rescinded and the purchase price
restored to the extent of such recovery or such additional costs, but without
interest. Borrower agrees that any Lender so purchasing a participation from
another Lender pursuant to this Section 2.11 may, to the fullest extent
permitted by law, exercise all its rights of payment (including the right of
set-off) with respect to such participation as fully as if such Lender were
the direct creditor of Borrower in the amount of such participation.
2.12 Pro Rata Treatment.
Subject to the provisions of Sections 2.8.2 and 2.8.3, each
borrowing by Borrower from Lenders and each payment (including each prepay-
ment) by Borrower on account of principal and/or interest in respect of the
Loans shall be made concurrently and pro rata as among all Lenders all in
accordance with their Pro Rata Shares appropriately adjusted in the case of
any Lender who shall have failed to fund its Pro Rata Share of the Loans.
III. SPECIAL PROVISIONS
3.1 Loss Proceeds Account. Borrower shall cause all Casualty Insurance
Proceeds or Condemnation Proceeds to be paid directly to an account
designated by Agent for such purpose and under the sole dominion and control
of Agent for the purposes of receiving and disbursing Loss Proceeds (the
"Loss Proceeds Account"), on behalf of Lenders. If any Loss Proceeds are
received by Borrower, the same shall be received in trust for Lenders, shall
be segregated from other funds of Borrower, and shall be paid directly to the
Loss Proceeds Account to be applied or disbursed in accordance with this
Agreement. Borrower hereby authorizes and directs any affected insurance
company to make payment of Loss Proceeds directly to the Loss Proceeds
Account and Borrower agrees to execute such additional instruments as any
such affected insurance company may request as a condition to making such
payment of Loss Proceeds.
3.2 Casualty and Condemnation.
3.2.1 Casualty, Condemnation and Application of Proceeds.
(a) Borrower shall give prompt written notice to Agent of
any Casualty at or Condemnation of the Properties or any part thereof
and shall deliver to Agent copies of any and all papers served in
connection with such proceedings. All Casualty Insurance Proceeds and
all Condemnation Proceeds shall be applied and disbursed in accordance
with the provisions of this Section and Section 2.3.2, as the case may
be.
(b) Upon the occurrence of any Casualty at or Condemnation
of the Properties or any part thereof, all Loss Proceeds shall only be
applied to the Indebtedness or toward the restoration of such Property,
as shall be determined by Borrower in its sole and absolute discretion;
provided, however, that (i) if an Event of Default shall be continuing
at the time of any Casualty or Condemnation, all Loss Proceeds shall
only be applied to the Indebtedness, in accordance with Section 2.3.2;
but (ii) if such Casualty or Condemnation occurs at a Property which is
encumbered by a Lien, the Loss Proceeds shall be applied in accordance
with such Lien documents.
(c) Upon the occurrence of any Casualty at or Condemnation
of the Properties or any part thereof during the existence of an Event
of Default, Agent alone shall have the right, in its sole and absolute
discretion, to settle, adjust or compromise any claim (i) under any
policy of insurance or (ii) in connection with a Condemnation. In all
other cases, Borrower may settle, adjust or compromise any such claim
which is less than $500,000.00, and with respect to any such claim in
excess of $500,000.00, Agent and the Borrower shall consult and
cooperate with each other and each shall be entitled to participate in
all meetings and negotiations with respect to the settlement of such
claim. Any adjustment or settlement by the Borrower of any claim which
is in excess of $500,000.00 shall be subject to prior Lender Approval,
which approval shall not be unreasonably withheld or delayed; provided
that if such Casualty/Condemnation occurs at a Property which is
encumbered by a Lien, the any settlement, adjustment or compromise
shall be decided in accordance with such Lien documents.
(d) In the event that Loss Proceeds from any Casualty at or
Condemnation of a Property or any part thereof are to be made available
to Borrower for restoration and the reasonably anticipated cost of the
restoration is $2,000,000 or more, the following provisions shall
apply:
(i) Borrower shall, no later than upon receipt of the
Loss Proceeds, commence diligently to restore the applicable
Property substantially to its value, character and utility
immediately prior to such Casualty or Condemnation (it being
understood that Borrower's commencement of such restoration prior
to receipt of Insurance Proceeds shall not in any way affect
Lender's right, if any, to apply Insurance Proceeds to the Loans
pursuant to and in accordance with the terms of this Agreement),
in which event Borrower shall comply with the following conditions
in connection with the performance of all of such restoration
(hereinafter "Work"):
(A) no Work shall be undertaken until Borrower
shall have provided Agent with evidence reasonably satisfac-
tory to Agent that the amounts deposited in the Loss
Proceeds Account will be sufficient to cover the entire cost
of such Work;
(B) no Work shall be undertaken until Borrower
shall have procured and paid for, so far as the same may be
required from time to time, all permits and consents of all
Governmental Authorities having jurisdiction;
(C) any Work that is structural in nature, that
involves mechanical, electrical, fire safety, HVAC or other
building systems or the performance of which in the
reasonable judgment of Agent otherwise requires the services
of a licensed architect, engineer and/or other professional
in accordance with safe and sound construction practices,
shall be performed in accordance with plans, specifications,
reports and/or drawings prepared by Borrower's architect,
engineer and/or other professional and approved by Agent
(such approval not to be unreasonably withheld or delayed)
and promptly following its receipt of same, Borrower shall
deliver to Agent copies of all plans, specifications,
reports and/or drawings relating to any such Work for its
review and approval (such approval not to be unreasonably
withheld or delayed);
(D) all Work shall be performed in accordance
with cost estimates approved by Agent as provided below and
promptly following its receipt of same, Borrower shall deli-
ver to Agent copies of all cost estimates relating to any
such Work for Agent's review and approval (such approval not
to be unreasonably withheld or delayed);
(E) any Work that is structural in nature or
that involves mechanical, electrical, fire safety, HVAC or
other building systems or the performance of which in the
reasonable judgment of Agent otherwise requires the services
of a licensed architect, engineer and/or other professional
in accordance with safe and sound construction practices,
shall be performed under the supervision of a licensed
architect, engineer and/or other professional reasonably
approved by Agent;
(F) all Work shall be prosecuted diligently to
completion in a good and workmanlike manner and in compli-
ance with all applicable permits and authorizations and with
all other applicable Legal Requirements;
(G) all Work shall be completed free and clear
of all liens, encumbrances, chattel mortgages, conditional
bills of sale and other charges, and substantially in
accordance with the plans and specifications therefor;
(H) during the performance of any Work, Borrower
shall procure and maintain, or cause to be procured and
maintained, (x) "All-Risk" builder's risk property
insurance, with vandalism and malicious mischief endorse-
ments, completed value form, covering all physical loss
(including any loss of or damage to supplies, machinery and
equipment) in connection with the performance of such Work
and (y) statutory workers' compensation and employers'
liability coverage, if applicable to Borrower; and
(I) Borrower shall reimburse Agent and Lenders
for all reasonable fees and expenses incurred by Agent or
Lenders in connection with their review of any Work.
(ii) All Loss Proceeds (in excess of $2,000,000 with
respect to any Casualty or Condemnation) shall be deposited in the
Loss Proceeds Account in accordance with the terms of this Agree-
ment. Agent shall disburse such proceeds (together with any
additional sums deposited) to or for the account of the Borrower
from time to time to pay the costs and expenses associated with
the restoration of the Properties, as set forth below:
(A) Each request for payment shall be made on
ten (10) Business Days' prior notice to Agent and, if an
architect, engineer or other professional was retained to
supervise the restoration, shall be accompanied by a certi-
ficate to be made by such supervising architect, engineer
and/or other professional stating that the sum requested is
required to reimburse Borrower for payments by Borrower to,
or is due to, the contractor, subcontractors, materialmen,
laborers, engineers, architects or other persons rendering
services or materials for the Work (giving a brief
description of such services and materials);
(B) Each request shall be accompanied by waivers
of liens satisfactory to Agent covering that part of the
Work for which reimbursement is being requested or for which
payment was previously requested; and
(C) Each request shall be accompanied by evi-
dence reasonably satisfactory to Lender that the amounts
deposited in the Loss Proceeds Account will be sufficient to
cover the remaining cost of such Work.
(e) Notwithstanding anything to the contrary contained in
this Agreement, during the continuance of an Event of Default, Lenders
shall have the absolute right to apply at any time all or any part of
the Loss Proceeds then held by or on behalf of Lenders to the prepay-
ment of the Indebtedness.
3.2.2 Conflicts With Mortgage Financing. If any term or
provision of Section 3.2.1 shall conflict with the terms of any mortgage
financing applicable to a Property as to which a Casualty or Condemnation has
occurred, then the terms and provisions of such Prior Debt Documents shall
take precedence over Sections 2.3.2 and 3.2.1 hereof.
IV. CONDITIONS PRECEDENT
4.1 Intentionally Omitted.
4.2 Conditions Precedent to All Advances.
The obligations of Lenders to make Advances on each Funding Date
are subject to the satisfaction by Borrower of the following conditions
precedent no later than such Funding Date:
4.2.1 Notice of Borrowing; Other Documentation. Agent shall
have received before such Funding Date, in accordance with the provisions of
Section 2.1.2, an (i) original executed Notice of Borrowing, in each case
signed by an authorized officer of Borrower, and (ii) such other documents,
agreements, certificates or instruments as Agent deems appropriate or
necessary.
4.2.2 Other Conditions. As of such Funding Date:
(a) the representations and warranties contained herein and
in the other Loan Documents shall be true and correct in all material
respects on and as of such Funding Date to the same extent as though
made on and as of that date, except to the extent such representations
and warranties specifically relate to an earlier date (including
references to "the Closing Date" or "the date hereof"), in which case
such representations and warranties shall have been true and correct in
all material respects on and as of such earlier date;
(b) Borrower and each Standby Purchaser shall have per-
formed in all material respects all agreements and satisfied all condi-
tions which this Agreement or any other Loan Document provides shall be
performed or satisfied by it on or before such Funding Date;
(c) no Material Adverse Effect (in the sole opinion of
Agent) shall have occurred;
(d) no order, judgment or decree of any arbitrator or
Governmental Authority shall purport to enjoin or restrain any Lender
from making the Advances to be made by it on that Funding Date; and
(e) no event shall have occurred and be continuing or would
result from the consummation of the borrowing contemplated by such
Notice of Borrowing that would constitute a Default or Event of
Default.
V. REPRESENTATIONS AND WARRANTIES
5.1 Borrower Representations.
Borrower represents and warrants (which representations and
warranties shall survive Borrower's delivery of the Notes and the making and
repayment of the Loans) that the following statements are true, correct and
complete as of the Closing Date and on each Funding Date:
5.1.1 Organization; Existence. Borrower has been duly
organized and is validly existing and in good standing as a business trust
under the laws of the State of Ohio, with requisite trust power and authority
to own or hold under lease its Properties and to transact the businesses in
which it now engaged, and to execute and deliver the Loan Documents to which
it is a party, and is qualified and self-administered as a REIT under Sec-
tions 856 through 860 of the Internal Revenue Code. Borrower is duly quali-
fied to do business in each jurisdiction where it is required to be so quali-
fied in connection with its Properties, businesses and operations where the
failure so to qualify would have a material adverse effect on Borrower. Bor-
rower possesses all rights, licenses, permits and authorizations, governmen-
tal or otherwise, necessary to entitle it to own its Properties and to
transact the businesses in which it is now engaged. Borrower's
Organizational Documents have been duly executed, delivered and, to the
extent required by applicable law, filed, and are in full force and effect in
accordance with their respective terms and have not been modified or amended.
5.1.2 Proceedings. Borrower has taken all necessary cor-
porate, trust, partnership or limited liability company action to authorize
the execution, delivery and performance of this Agreement and the other Loan
Documents to which it is a party, and the performance of all transactions
contemplated thereby, including the Offering. This Agreement and such other
Loan Documents to which Borrower is a party have been duly executed and
delivered by or on behalf of Borrower.
5.1.3 No Conflicts. The execution, delivery and performance
by Borrower of the Loan Documents to which it is a party, and the performance
of all transactions contemplated thereby, including the Offering, will not
conflict with or violate any provisions of its Organizational Documents or
conflict with or result in a breach of any of the terms or provisions of, or
constitute a Default under, or result in the creation or imposition of any
Lien, charge or encumbrance (other than pursuant to the Loan Documents) upon
any of the Properties pursuant to the terms of any indenture, mortgage, deed
of trust, loan agreement or other agreement or instrument to which it is a
party or by which it is bound or to which the Properties are subject, nor
will such action result in any material violation of the provisions of any
statute or any order, rule or regulation of any court or governmental agency
or body having jurisdiction over Borrower (or any of its Affiliates), or over
any of Borrower's Properties (including without limitation Regulations G, T,
U or X of the Board of Governors of the Federal Reserve System), and any
consent, approval, authorization, order, registration or qualification of or
with any court or any such regulatory authority or other governmental agency
or body or any other Person required for the execution, delivery and per-
formance by Borrower of the Loan Documents to which it is a party has been
obtained and is in full force and effect and no term of condition thereof has
been amended or modified.
5.1.4 Litigation. Except as set forth on Schedule 5.1.4,
there are no actions, suits or proceedings at law or in equity by or before
any Governmental Authority or other agency now pending or, to Borrower's
knowledge, threatened against or affecting Borrower where such actions, suits
or proceedings, if determined against Borrower, could, individually or
collectively, reasonably be expected to have a Material Adverse Effect.
There are no proceedings pending or, to Borrower's knowledge, threatened
against Borrower which call into question the validity or enforceability of
any of the Loan Documents.
5.1.5 Agreements. Borrower is not a party to any agreement
or instrument or subject to any restriction which does or could reasonably be
expected to result in a Material Adverse Effect.
5.1.6 No Bankruptcy Filing. Borrower has not filed and Bor-
rower is not contemplating either the filing of a petition by it under any
state or federal bankruptcy or insolvency laws or the liquidation of all or a
major portion of its assets or property, and Borrower has no knowledge of any
Person contemplating the filing of any such petition against it.
5.1.7 Full and Accurate Disclosure. No statement of fact
made by Borrower in this Agreement or in any of the other Loan Documents
contains any untrue statement of a material fact or omits to state any
material fact necessary to make statements contained herein or therein not
materially misleading.
5.1.8 Tax and REIT Status. Borrower has timely filed all
tax returns that are required to be filed with any Government Entity and has
timely paid all Taxes due pursuant to the tax returns or any assessment
received by it or otherwise required to be paid, except Taxes being contested
in good faith by appropriate proceedings and for which adequate reserves or
other provisions are maintained in accordance with GAAP. Borrower has (i)
elected to be taxed as a REIT effective for each of the taxable years ending
on or after December 31, 1961, (ii) has not revoked such election, (iii)
qualified for taxation as a REIT for each such taxable year and is in a
position to so qualify for its current taxable year, (iv) operates in a
manner so as to qualify as a REIT, and (v) has not sold or otherwise disposed
of any assets which could give rise to a material amount of Tax pursuant to
any election made by Borrower under Notice 88-19, 1988-1 CB 486 and does not
expect to effect any such sale or other disposition.
5.1.9 Use of Proceeds. Borrower's use of the proceeds of the
Loans is solely for the purposes described in Section 2.2.
5.1.10 Financial Information. Borrower has furnished Lenders
with true, correct and complete copies of (a) the combined annual financial
statements for Borrower and Manager for the most recent fiscal year of
Borrower, including the combined balance sheet of Borrower and Manager and as
of the end of such fiscal year and combined statements of income and changes
in cash for Borrower and Manager and a statement of shareholder's equity,
prepared on a consistent basis in accordance with GAAP (except as
specifically disclosed therein) and in the form included with Borrower's Form
10-K as filed with the Securities and Exchange Commission for such fiscal
year, certified without qualification by Borrower's CPAs; (b) the combined
quarterly financial statements for Borrower and Manager for each fiscal
quarter elapsed since the expiration of Borrower's most recent fiscal year,
including a combined balance sheet and combined statements of income and
change in cash of Borrower and the Manager prepared on a consistent basis
with the prior fiscal year's financial statements in accordance with GAAP
(except as specifically disclosed therein), and in the form included with
Borrower's Form 10-Q, as filed with the Securities and Exchange Commission
for any such fiscal quarter; and (c) a certificate of the chief financial
officer, principal accounting officer or chief executive officer of Borrower,
stating that to his best knowledge after due inquiry the foregoing statements
present fairly in all material respects the combined financial position of
Borrower and Manager and the results of their combined operations, subject,
solely with respect to the materials described in clause (b), to routine
year-end audit adjustments. No changes have occurred in the assets,
liabilities or financial condition of Borrower or Manager from those
reflected in the most recent balance sheets referred to above in this Section
which, individually or in the aggregate, have been materially adverse. Since
the date of such most recent balance sheet, there has been no material and
adverse development in the business or in the operations or prospects of
Borrower or Manager.
5.1.11 No Default.
(a) No event has occurred and is continuing, and no condition
exists, which constitutes a Default or Event of Default.
(b) No Default by Borrower or any Standby Purchaser and no
accrued right of rescission, cancellation or termination on the part of
Borrower or any Standby Purchaser exists under this Agreement or any of
the other Loan Documents.
5.1.12 Federal Reserve Regulations. No part of the proceeds
of the Loans 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.
5.1.13 Enforceability. The Loan Documents constitute legal,
valid and binding obligations of Borrower and Standby Purchasers party
thereto, enforceable in accordance with their respective terms, subject to
applicable bankruptcy, insolvency and similar laws affecting rights of
creditors generally, and subject, as to enforceability, to general principles
of equity (regardless of whether enforcement is sought in a proceeding at law
or in equity) and are not subject to any right of rescission, set-off,
counterclaim or defense by Borrower or any Standby Purchaser, including the
defense of usury, and neither Borrower nor any Standby Purchaser has asserted
any right of rescission, set-off, counterclaim or defense with respect
thereto.
5.1.14 Incorporation of Representations and Warranties. In
addition to the foregoing representations and warranties, each of the
representations and warranties set forth in Section 6 of the Line of Credit
Facility and any related definitions, as in effect on the date hereof, are
hereby incorporated herein by reference and shall apply, mutatis mutandis, to
this Agreement.
VI. AFFIRMATIVE COVENANTS
6.1 Borrower Covenants.
From the date hereof and until the indefeasible payment and perfo-
rmance in full of all Indebtedness of Borrower, Borrower hereby covenants and
agrees with Lenders that:
6.1.1 SEC Filings and Press Releases. Borrower shall provide
to Agent copies promptly after their filing or, if not filed, after they
become available, of (a) all financial statements, reports, notices and proxy
statements sent or made available generally by Borrower to its security
holders, (b) all regular and periodic reports and all registration statements
and prospectuses, if any, filed by the Borrower with the New York Stock
Exchange, Inc., any other securities exchange or with the Securities and Ex-
change Commission or any Governmental Authority or private regulatory
authority, and (c) all press releases and other statements made available
generally by Borrower or any of its Affiliates to the public or to the
securityholders of the Borrower;
6.1.2 Business and Operations. Borrower will continue to
engage in the businesses presently conducted by it (i.e., acquisition,
disposition and ownership of real property); provided that Borrower may cease
conducting any business presently conducted by it, with prior written Lender
Approval (such Lender Approval not to be unreasonably withheld). Borrower
will qualify to do business and will remain in good standing under the laws
of each jurisdiction necessary for the conduct of its business.
6.1.3 Costs of Enforcement. In the event of the Bankruptcy,
insolvency, rehabilitation or other similar proceeding in respect of Borrower
or an assignment by Borrower for the benefit of its creditors, Borrower, its
successors or assigns, shall be chargeable with and agrees to pay all costs
of collection and defense, including reasonable attorneys' fees in connection
therewith and in connection with any appellate proceeding or post-judgment
action involved therein, which shall be due and payable together with all
required service or use Taxes.
6.1.4 Estoppel Statement. Borrower, within ten (10) days
after request from Agent, shall furnish to Agent a statement, duly acknowl-
edged and certified to Lenders and to any other Person designated by Agent,
setting forth (a) the amount then owing by Borrower in respect of the
Indebtedness, (b) the date through which interest on the Loans has been paid,
(c) the nonexistence of any offsets, counterclaims, credits or defenses to
the payment of Borrower's obligations under the Loan Documents, and
(d) whether any written notice of default from Lenders or Agent to Borrower
is then outstanding, and acknowledging that this Agreement and the other Loan
Documents have not been modified or, if modified, giving the particulars of
such modification.
6.1.5 Loan Proceeds. Borrower shall use the proceeds of the
Loans only for the purposes set forth in Section 2.2.
6.1.6 Name; Principal Place of Business. Borrower shall
provide to Agent (a) notification of any change in Borrower's name, identity
or corporate, partnership, limited liability company or trust structure
within 30 days of such change and (b) 30 days' prior written notice of any
change in Borrower's executive office or principal place of business.
6.1.7 Board of Trustees. Borrower shall provide to Agent,
with reasonable promptness, written notice of any change in the Board of
Trustees of Borrower.
6.1.8 Offering. Borrower shall obtain Lender Approval of the
registration statement for the Offering, file the approved registration
statement for the Offering and use its best efforts to consummate the
Offering, all in accordance with Article XI.
6.1.9 Incorporation of Affirmative Covenants. In addition to
the foregoing affirmative covenants, each of the affirmative covenants set
forth in Section 7 of the Line of Credit Facility and any related
definitions, as in effect on the date hereof, are hereby incorporated herein
by reference as if set forth herein in full and shall apply, mutatis
mutandis, to this Agreement; provided, however, that the following
affirmative covenants of the Line of Credit Facility are not so incorporated:
7.3, 7.4, 7.16(f) and 7.16(g), 7.17, 7.18 and 7.19.
VII. NEGATIVE COVENANTS
7.1 Borrower Negative Covenants.
From the date hereof until payment and performance in full of all
Indebtedness of Borrower, Borrower covenants and agrees with Lenders that it
will not do, directly or indirectly, any of the following:
7.1.1 Debt. Without prior Lender Approval and except for
Debt existing on the date hereof and reflected in the financial information
furnished to Lenders, Borrower shall not create, incur or assume any Debt
exceeding in the aggregate Five Million Dollars ($5,000,000.00) other than
(a) the Indebtedness; (b) draws under the existing Line of Credit Facility or
the Imperial Credit Facility; and (c) non-recourse mortgage Debt for the pur-
pose of financing an acquisition of a Property or refinancing any Property
(provided that in the event of a refinancing such Debt may only encumber the
Property being refinanced and in the event of an acquisition such Debt may
only encumber the asset being acquired); provided that the net proceeds of
any such financing or refinancing shall be used to prepay the Indebtedness
pursuant to Section 2.3.2 above.
7.1.2 Corporate Structure. Without prior written Lender
Approval (such Lender Approval not to be unreasonably withheld), Borrower
shall not, and shall not permit any of its Subsidiaries or Affiliates to: (i)
except as provided in Article XI, alter the corporate, capital or legal
structure of Borrower or any of its Subsidiaries or Affiliates (including by
the issuance or distribution of a new or special class of securities), (ii)
incorporate or otherwise organize any Subsidiaries, (iii) make or permit any
transfer, or acquire by purchase or otherwise, directly or indirectly, all or
substantially all the business, property or fixed assets of, or stock or
other evidence of beneficial ownership of, any Person, or (iv) engage in any
transaction or take any action that would cause Borrower or Paired Trust to
cease to qualify as a "stapled entity" entitled to an exemption from the
requirements of Section 269B of the Internal Revenue Code.
7.1.3 Incorporation of Negative Covenants. In addition to
the foregoing negative covenants, each of the negative covenants set forth in
Section 8 of the Line of Credit Facility and any related definitions, as in
effect on the date hereof, are hereby incorporated herein by reference as if
set forth herein in full and shall apply, mutatis mutandis, to this Agree-
ment.
VIII. DEFAULTS
8.1 Event of Default.
(a) In case of the occurrence of any of the following
events (each of which is herein sometimes called an "Event of
Default"):
(i) if Borrower fails to make any payment of princi-
pal of, or interest on, the Loans on the date on which such pay-
ment was due hereunder;
(ii) if Borrower fails to pay the Indebtedness in full
on the Initial Maturity Date (or, if the term of the Loan is
extended pursuant to Section 2.6, the Initial Extension Maturity
Date or the Final Extension Maturity Date, as the case may be);
(iii) if Borrower or Standby Purchaser fails to
pay any other amount payable by Borrower or Standby Purchaser pur-
suant to this Agreement or any other Loan Document when due and
such failure continues for five (5) Business Days after Lender
delivers written notice thereof to Borrower;
(iv) if any representation or warranty made by Bor-
rower or any Standby Purchaser herein or in any other Loan Docu-
ment, or in any report, certificate, financial statement or other
instrument, agreement or document furnished by Borrower or any
Standby Purchaser in connection with this Agreement or any other
Loan Document, shall be inaccurate or misleading in any material
respect as of the date such representation or warranty was made or
deemed made;
(v) if Borrower or any Standby Purchaser shall make
an assignment for the benefit of creditors;
(vi) if a receiver, liquidator or trustee shall be
appointed for Borrower or any Standby Purchaser or if Borrower or
any Standby Purchaser shall be adjudicated a "Debtor" under the
federal bankruptcy law or insolvent, or if any petition for Bank-
ruptcy, reorganization or arrangement pursuant to federal Bank-
ruptcy law, or any similar federal or state law, shall be filed by
or against, consented to, or acquiesced in by Borrower or any
Standby Purchaser, or if any proceeding for the dissolution or
liquidation of Borrower or any Standby Purchaser shall be
instituted; provided, however, if such appointment, adjudication,
petition or proceeding was involuntary and not consented to by
Borrower or any Standby Purchaser, the same shall become an Event
of Default upon the same not being discharged, stayed or dismissed
within sixty (60) days, or if Borrower or any Standby Purchaser
shall generally not be paying its debts as they become due;
(vii) if Borrower assigns its rights under this
Agreement or any of the other Loan Documents or any interest
herein or therein; or if any Standby Purchaser assigns its rights
under a Standby Purchase Agreement or any interest therein, other
than in accordance with the terms of such Standby Purchase
Agreement;
(viii) if an Event of Default as defined or de-
scribed in any other Loan Document occurs, or if any other event
shall occur or condition shall exist, if the effect of such event
or condition is to accelerate the maturity of all or any portion
of the Indebtedness or to permit Lenders to accelerate the
maturity of all or any portion of the Indebtedness;
(ix) except as otherwise provided in this Section 8.1,
if Borrower or Standby Purchaser shall continue to be in default
under any of the other terms, covenants or conditions of this
Agreement or any other Loan Document, for ten (10) days after
notice to Borrower or Standby Purchaser from Agent, 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 Agent 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 30-day period and provided further that Borrower or
Standby Purchaser shall have commenced to cure such default within
such 30-day period and thereafter diligently and expeditiously
proceeds to cure the same, such 30-day period shall be extended
for such time as is reasonably necessary for Borrower or Standby
Purchaser in the exercise of due diligence to cure such default,
such additional period not to exceed thirty (30) days;
(x) if Borrower fails to make any payment due to any
Indemnitee or such Indemnitee's respective officers, directors,
agents, parents or affiliates pursuant to Section 9.14 hereof for
a period of fifteen (15) days after receipt by Borrower of written
demand therefor; provided that Borrower shall not be deemed to be
in Default in respect of any such payment (or portion thereof)
which Borrower is contesting in good faith pursuant to appropriate
proceedings, provided, further, that (A) Borrower shall post cash
or other security reasonably satisfactory to the relevant
Indemnitee with an escrowee satisfactory to such Indemnitee in an
amount equal to the disputed amount during the pendency of any
appeal by Borrower of an adverse determination, and (B) if such
contest is finally determined in favor of the Indemnitee (or if
Borrower does not appeal an adverse determination), Borrower shall
be required to make such payment (or portion thereof) to such
Indemnitee within ten (10) days after such determination;
(xi) if any money judgment, writ or warrant of attach-
ment or similar process requiring the payment of in excess of
$500,000 not adequately covered by insurance as to which a solvent
and unaffiliated insurance company has acknowledged coverage shall
be entered or filed against Borrower or any of its assets and
shall remain undischarged, unvacated, unbonded or unstayed for a
period of sixty (60) days (or in any event later than five days
prior to the date of any proposed sale thereunder);
(xii) if there shall be a default by Borrower
under any of the Prior Debt Documents (as in effect on the date
hereof) or if there shall be a default by Borrower under any of
the Prior Debt Documents (as from time to time in effect);
(xiii) if Borrower shall cease for any reason to
maintain its status as a REIT under the Internal Revenue Code;
(xiv) a Change in Control shall occur; or
(xv) an Event of Default (as defined in the Other Loan
Agreement) shall occur under the Other Loan Agreement;
then and in every such Event of Default and at any time thereafter during the
continuance thereof, Agent may, in addition to any other rights or remedies
available to Agent and/or Lender pursuant to this Agreement and the other
Loan Documents or at law or in equity, take such action, without notice or
demand, that Required Lenders deem advisable to protect and enforce their
rights against Borrower and/or any Standby Purchaser, including declaring the
Indebtedness or any portion thereof to be immediately due and payable, and
may enforce or avail itself of any or all rights or remedies provided in the
Loan Documents, including all rights or remedies available at law or in
equity.
8.2 Remedies. Upon the occurrence and during the continuance of an
Event of Default, all or any one or more of the rights, powers, privileges
and other remedies available to Lenders under this Agreement or any of the
other Loan Documents or at law or in equity may be exercised, at the direc-
tion of the Required Lenders by Agent on behalf of Lenders at any time and
from time to time, whether or not all or any of the Indebtedness shall be
declared due and payable, and whether or not Agent on behalf of Lenders shall
have commenced any action for the enforcement of Lender's rights and remedies
under any of the Loan Documents.
8.3 Remedies Cumulative. The rights, powers and remedies of Agent and
Lenders under this Agreement shall be cumulative and not exclusive of any
other right, power or remedy which Agent and Lenders may have against Bor-
rower pursuant to this Agreement or the other Loan Documents, or existing at
law or in equity or otherwise. Agent's and Lenders' rights, powers and
remedies shall be concurrent and may be pursued independently, singly,
successively, together or otherwise, at such time and in such order as
Required Lenders may determine, to the fullest extent permitted by law, with-
out impairing or otherwise affecting the other rights and remedies of Agent
and Lenders permitted by law, equity or contract or as set forth herein or in
the other Loan Documents. 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 shall not
be construed to be a waiver of any subsequent Default or Event of Default or
to impair any remedy, right or power consequent thereon.
8.4 Gotham's Cure Rights. Notwithstanding anything contained herein
or in any other Loan Document, if there shall be a Default or Event of
Default by any Standby Purchaser (other than Gotham) under this Agreement or
any other Loan Document, or a Default or Event of Default by Borrower which
is due to any breach by any Standby Purchaser (other than Gotham) of any
representations, warranties, covenants or any other provision contained in
this Agreement or any other Loan Document (each such event, a "Standby
Purchaser Default"), then such Default or Event of Default may be cured in
accordance with the following procedures:
(a) Agent, promptly following its receipt of notice of such
Standby Purchaser Default, shall notify Gotham of the occurrence of
such Standby Purchaser Default (the "Standby Purchaser Notice");
(b) Gotham shall, within fifteen (15) days of receipt of
the Standby Purchaser Notice, elect, in a writing delivered to Agent,
to either: (i) assume all rights and obligations of the defaulting
Standby Purchaser under its respective Standby Purchase Agreement (the
"Alternate Standby Rights"), or (ii) decline to so assume the Alternate
Standby Rights. Failure by Gotham to respond within 15 days shall be
deemed to be a decision to decline to assume the Alternate Standby
Rights.
(c) If Gotham chooses to assume the Alternate Standby
Rights, each Gotham Standby Purchase Agreement shall be deemed to have
been amended to reflect Gotham's assumption of the Alternate Standby
Rights (with such assumption to be on a pro-rata basis among the
entities comprising Gotham, unless Gotham's notice sets forth a
different allocation for the assumption of the Alternate Standby
Rights), the rights of the defaulting Standby Purchaser so to purchase
shall be subject to Gotham's rights so to purchase and the Standby
Purchaser Default shall be deemed cured. If Gotham chooses to decline
to assume the Alternate Standby Rights, then such Standby Purchaser
Default shall constitute a Default or Event of Default as described in
Section 8.1 of this Agreement.
IX. MISCELLANEOUS
9.1 Survival. This Agreement and all covenants, agreements, repre-
sentations and warranties made herein and in the certificates delivered pur-
suant hereto shall survive the Closing Date, the making by Lenders of any
Loans hereunder and the execution and delivery to Agent of the Notes, and
shall continue in full force and effect so long as all or any of the Indebt-
edness is outstanding and unpaid. All covenants, promises and agreements in
this Agreement contained shall inure to the benefit of and be binding upon
the respective legal representatives, successors and assigns of the parties
hereto, provided that Borrower may not assign or transfer any of its rights
or obligations hereunder.
9.2 Lenders' or Agent's Discretion. Whenever pursuant to this Agree-
ment or any other Loan Document, Lenders or Agent exercise any right given to
any of them to approve, disapprove, make a determination, exercise discretion
or consent, or any arrangement or term is to be satisfactory to Lenders or
Agent, the decision of Lenders or Agent to approve, disapprove, make a
determination, exercise discretion or consent, or to decide whether
arrangements or terms are satisfactory or not satisfactory shall (except as
otherwise specifically herein or in any other Loan Document provided) be in
the sole discretion of Lenders or Agent and shall be final and conclusive.
9.3 Governing Law.
(a) This Agreement was negotiated in the State of New York,
and made by Lenders and Agent and accepted by the Borrower in the State
of New York, and the proceeds of the Notes 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
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 and any applicable law of
the United States of America. 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 Notes. Lenders, Agent and Borrower hereby agree, in accordance
with Section 5-1401 of the New York General Obligations Law, that this
Agreement and the Notes shall be governed by and construed in
accordance with the laws of the State of New York.
(b) To the fullest extent permitted by applicable law, any
legal suit, action or proceeding against Lenders, Agent or Borrower
arising out of or relating to this Agreement shall be instituted in any
federal or state court in New York, New York (the "New York Courts"),
pursuant to Section 5-1402 of the New York General Obligations Law, and
Borrower waives any objection which it may now or hereafter have to the
laying of venue of any such suit, action or proceeding in the New York
Courts, and Borrower hereby irrevocably submits to the jurisdiction of
any such New York Court in any suit, action or proceeding. Borrower
does hereby designate and appoint Gotham Partners Management Co., LLC,
having an address at ▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇,
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ or at such other office in New York, New
York as it may direct, 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 of Bor-
rower mailed or delivered to Borrower in the manner provided herein
shall be deemed in every respect effective service of process upon Bor-
rower, in any such suit, action or proceeding in the State of New York.
Borrower (i) shall give prompt notice to Agent 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 office shall be designated as the address for
service of process), and (iii) shall promptly designate such a substi-
tute if its authorized agent ceases to have an office in New York, New
York or is dissolved without leaving a successor.
9.4 Modification, Waiver in Writing. Except as otherwise required by
this Section or where Agent is, pursuant to any of the Loan Documents,
authorized to act without the consent of the Lenders, no modification,
termination or waiver of any provisions of this Agreement or of any of the
other Loan Documents, nor consent to any departure therefrom, shall in any
event be effective, irrespective of any course of dealing between the
parties, unless the same shall be in a writing executed by Required Lenders;
provided, however, that, notwithstanding anything to the contrary in any of
the Loan Documents, Agent may amend any of the Loan Documents or waive any
condition or provision thereof if such amendment or waiver is of a technical
nature. Any such waiver or consent shall be effective only in the specific
instance and for the specific purpose for which given. No notice to or
demand on Borrower, any Guarantor or any Standby Purchaser in any case shall
entitle Borrower, any Guarantor or any Standby Purchaser to any other or
further notice or demand in the same, similar or other circumstances. In the
case and to the extent of any waiver, the parties shall be restored to their
former positions and rights hereunder and under the other Loan Documents; but
no such waiver shall extend to any subsequent or other Default or Event of
Default or impair any right consequent thereon. No disbursement of an
Advance or of a portion thereof shall constitute a waiver of any Default,
Event of Default or condition to disbursement, nor shall such disbursement
preclude Agent on behalf of Required Lenders from declaring an Event of
Default and pursuing its and their remedies hereunder in the event such Event
of Default is not cured. Any Advance made by Lenders hereunder made prior to
or without the fulfillment by Borrower of all of the conditions precedent
thereto, whether or not known to Agent and/or Lenders, shall not constitute a
waiver by Agent and/or Lenders of the requirement that all conditions,
including the non-performed conditions, shall be satisfied with respect to
all future advances. This Agreement, together with the other Loan Documents,
sets forth the entire understanding of the parties hereto with respect to the
subject matter hereof and supersedes all prior agreements and understandings
relating hereto, whether oral or written. Except as may be expressly
required by the Loan Documents, Required Lenders shall not, without the prior
written consent of all Lenders, (i) increase the principal amount of the
Loans, (ii) postpone any date fixed for payment of principal or interest on
the Loans, (iii) reduce the amount of any principal or interest payable with
respect to the Loans, (iv) release Borrower, any Guarantor or Standby Pur-
chaser or forgive or discharge all or any part of the Loans, in each event
whether or not with consideration, (v) change the definition of Required
Lenders, (vi) change the Commitment of any Lender, (vii) change this sentence
or the first sentence of Section 9.4, (viii) reduce the fees payable by
Borrower, (ix) permit Borrower to assign any of its rights or obligations
under the Loan Documents, (x) consent to any amendment or modification to the
Loan Documents which is material and is favorable to Borrower, (xi) waive
any Event of Default, or (x) modify Section 11.1.
9.5 Delay Not a Waiver. Neither any failure nor any delay on the part
of Agent or any Lender, in insisting upon strict performance of any term,
condition, covenant or agreement, or exercising any right, power, remedy or
privilege hereunder, or under the Notes or under any other Loan Document, or
any other instrument given as security therefor, 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 Agree-
ment, the Notes or any other Loan Document, Lenders and Agent shall not be
deemed to have waived any right either to require prompt payment when due of
all other amounts due under this Agreement, the Note or the other Loan Docu-
ments, or to declare a default for failure to effect prompt payment of any
such other amount.
9.6 Notices. All notices, consents, approvals and requests required
or permitted hereunder or under any other Loan Document shall be given in
writing and shall be effective for all purposes if hand delivered or sent by
(a) certified or registered United States mail, postage prepaid, (b)
expedited prepaid delivery service, either commercial or United States Postal
Service, with proof of attempted delivery, or (c) telecopier (with answer
back acknowledged and hard copy sent by hand or one of the methods described
in clause (a) or (b) above), addressed if to Lenders at their addresses set
forth above, if to Agent at its address set forth on the first page hereof,
and if to Borrower at the address of Borrower set forth above (with a copy to
Gotham Partners Management Co., LLC, ▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇
▇▇▇▇▇, Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇), or at such other address as shall be
designated from time to time by any party hereto, as the case may be, in a
written notice to the other parties hereto in the manner provided for in this
Section. A notice shall be deemed to have been given: in the case of hand
delivery, at the time of delivery; in the case of registered or certified
mail, when delivered or the first attempted delivery on a Business Day; in
the case of expedited prepaid delivery and telecopy, upon the first attempted
delivery on a Business Day; or if telecopied, upon receipt.
9.7 Trial By Jury. BORROWER, AGENT AND EACH LENDER EACH HEREBY AGREES
TO WAIVE ITS RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF
ACTION BASED UPON OR ARISING OUT OF THIS AGREEMENT, ANY OTHER LOAN DOCUMENT
OR ANY DEALINGS BETWEEN THEM RELATING TO THE SUBJECT MATTER OF THIS AGREEMENT
AND THE LENDER/BORROWER RELATIONSHIP BETWEEN THEM. The scope of this waiver
is intended to encompass any and all disputes that may be filed in any court
and that relate to the subject matter of this transaction, including contract
claims, tort claims, breach of duty claims, and all other common laws and
statutory claims. Borrower, Agent and each Lender each acknowledges that
this waiver is a material inducement to enter into this Agreement, and that
each will continue to rely on the waiver in their related future dealing.
Borrower warrants and represents that it has reviewed this waiver with its
legal counsel, and that it knowingly and voluntarily waives its jury trial
rights following consultation with legal counsel. THIS WAIVER IS
IRREVOCABLE, MEANING THAT IT MAY NOT BE MODIFIED EITHER ORALLY OR IN WRITING,
AND THE WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS,
SUPPLEMENTS OR MODIFICATIONS TO THIS AGREEMENT, ANY OTHER DOCUMENTS OR AGREE-
MENTS RELATING TO THE LOANS. In the event of litigation, this Agreement may
be filed as a written consent to a trial by the court.
9.8 Headings. 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.
9.9 Severability. If any provision of this Agreement or any of the
other Loan Documents or the application thereof to any Person or circumstance
shall, for any reason and to any extent, be invalid or unenforceable, then
neither the remainder of this Agreement or the other Loan Documents nor the
application of such provision to other Persons or circumstances nor the other
instruments referred to hereinabove shall be affected thereby, but rather
shall be enforced to the greatest extent permitted by applicable Legal
Requirements.
9.10 Preferences. To the extent any Person makes a payment or payments
to Agent for Borrower's benefit, which payment or proceeds or any part there-
of 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 obliga-
tions hereunder or under any other Loan Document 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 Agent.
9.11 Waiver of Notice. Borrower shall not be entitled to any notices
of any nature whatsoever from Agent or Lenders except with respect to matters
for which this Agreement or the other Loan Documents specifically and
expressly provide for the giving of notice by Agent or Lenders 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. Bor-
rower hereby expressly waives the right to receive any notice from Agent or
Lenders 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 Agent or Lenders to Borrower.
9.12 Remedies of Borrower. In the event that a claim or adjudication
is made that Agent or Lenders or their agents have acted unreasonably or
unreasonably delayed acting in any case where by law or under this Agreement
or the other Loan Documents, Agent, Lenders or such agent, as the case may
be, have an obligation to act reasonably or promptly, Borrower agrees that
neither Agent, Lenders nor their agents shall be liable for any monetary
damages, and Borrower's sole remedies shall be limited to commencing an
action seeking injunctive relief or declaratory judgment. The parties hereto
agree that any action or proceeding to determine whether Agent or any Lender
has acted reasonably shall be determined by an action seeking declaratory
judgment. In any such action, the prevailing party shall be entitled to
recover its reasonable attorneys' fees and disbursements incurred in connec-
tion with such action from the other party.
9.13 Non-Exculpation. Notwithstanding anything to the contrary in this
Agreement or the other Loan Documents, Borrower's obligations to pay the
principal of and interest on the Loans, the Notes and any and all other
amounts payable by Borrower hereunder and under the other Loan Documents, the
performance by Borrower of its respective obligations hereunder and under the
other Loan Documents, and Borrower's liability for its representations,
warranties and covenants hereunder and under the other Loan Documents, shall
be full recourse obligations of Borrower.
9.14 Expenses; Indemnity.
(a) Borrower covenants and agrees to reimburse Indemnitees
and each of them upon receipt of written notice from any Indemnitee for
all loss, cost, damage, expense or liability of any kind or nature
whatsoever (including reasonable attorneys' fees and disbursements) in-
curred by such Indemnitee in connection with (i) the preparation,
negotiation, execution, delivery and administration of this Agreement,
the other Loan Documents and the consummation of the transactions
contemplated hereby and thereby (ii) the negotiation, preparation,
execution, delivery and administration of any consents, amendments,
waivers or other modifications to this Agreement, the other Loan Docu-
ments, and any other documents or matters if requested by Borrower or
required by Agent or Lenders; (iii) reasonable fees and expenses of
counsel for providing to Agent and Lenders all required legal opinions;
(iv) enforcing or preserving any rights in response to third party
claims or prosecuting or defending any action or proceeding or other
litigation, in each case against, under, affecting or relating to Bor-
rower, any Guarantor, this Agreement or the other Loan Documents; and
(v) enforcing any obligations of, or paying or performing any defaulted
obligations of, or collecting any payments due from, Borrower or any
Guarantor or Standby Purchaser under this Agreement, the other Loan
Documents or in connection with any refinancing or restructuring of the
credit arrangements provided under this Agreement or any of the other
Loan Documents in the nature of a "work-out" or of any insolvency or
bankruptcy proceedings in respect of Borrower or any Guarantor or
Standby Purchaser or any of its successors; provided, however, that
Borrower shall not be liable for the payment of any costs and expenses
described in clauses (i) through (v) above to the extent the same arise
by reason of the gross negligence, illegal acts, fraud or willful
misconduct of the Indemnitees, their agents, contractors or employees.
(b) In addition to but without duplication of the payment
of expenses pursuant to subsection (a) above, whether or not the trans-
actions contemplated hereby shall be consummated, Borrower agrees to
indemnify, pay and hold harmless the Indemnitees, and each of them,
from and against any and all other losses, costs, damages, expenses or
liabilities of any kind or nature whatsoever (including the reasonable
fees and disbursements of counsel for such Indemnitee in connection
with any investigative, administrative or judicial proceeding commenced
or threatened, whether or not such Indemnitee shall be designated a
party thereto), that may be imposed on, incurred by, or asserted
against such Indemnitee in any manner relating to or arising out of
(i) any breach by Borrower of its obligations under, or any material
misrepresentation by Borrower contained in this Agreement or any Loan
Document, or (ii) the use or intended use of the proceeds of the Loans
(collectively, the "Indemnified Liabilities"); provided, however, that
Borrower shall not have any obligation to an Indemnitee hereunder to
the extent that such Indemnified Liabilities arise from gross negli-
gence, illegal acts, fraud or willful misconduct of such Indemnitee,
its agents, contractors or employees. To the extent that the
undertaking to indemnify, pay and hold harmless set forth in the
preceding sentence may be unenforceable because it violates any law or
public policy, Borrower shall contribute 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 Indemnitees
or any of them. Borrower shall not, without the prior written consent
of the applicable Indemnitee, settle or compromise any claim, or permit
a default or consent to the entry of judgment in respect thereof,
unless such settlement, compromise or consent includes, as an
unconditional term thereof, the giving by the claimant to the
Indemnitee of an unconditional release from all liability in respect of
such Claim.
(c) Nothing herein shall limit the indemnity made by
Borrower to and in favor of Agent and Lenders in the Standby Purchase
Agreements.
(d) Borrower hereby acknowledges and agrees that each
Indemnitee (other than each Lender) is an intended third-party bene-
ficiary of this Section 9.14.
Promptly after receipt by an Indemnitee of notice of any claim or
the commencement of any action for which indemnity may be sought against Bor-
rower under this Agreement or any other Loan Document, such Indemnitee shall
notify Borrower in writing of the receipt of such claim. Borrower shall be
entitled to assume the defense of any claim with counsel reasonably
satisfactory to such Indemnitee, and after notice from Borrower to such
Indemnitee of its election so to assume and actual assumption of the defense
thereof with counsel reasonably satisfactory to such Indemnitee, Borrower
shall not be liable to such Indemnitee under any indemnity agreement set
forth herein or in any other Loan Document for any legal or other expense
subsequently incurred by such Indemnitee in connection with the defense
thereof other than reasonable fees and expenses of separate counsel retained
by such Indemnitee unless (a) Borrower and such Indemnitee shall have agreed
to the retention of such subsequent counsel or (b) such Indemnitee shall have
reasonably concluded that representation of Borrower and such Indemnitee by
the same counsel would be inappropriate due to actual or potential
conflicting interests between them. Borrower shall have no liability for any
settlement of any action or claim effected without its consent, but if
settled with such consent or if there be a final judgment for the plaintiff
not stayed by appeal, Borrower agrees to indemnify the Indemnitee from and
against any loss or liability required to be paid by the Indemnitee by reason
of such settlement or judgment if and to the extent required by, and subject
to the limitations of, the terms of this Agreement. Borrower agrees to
consult in advance with Agent with respect to the terms of any proposed
waiver, release or settlement of any claim, liability, proceeding or other
action against Borrower to which any Indemnitee may also be subject, and to
use reasonable efforts to afford Agent and any such Indemnitee the opportu-
nity to join in such waiver, release or settlement.
9.15 Exhibits, Schedules Incorporated. The Exhibits and 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.
9.16 Offsets, Counterclaims and Defenses. Any assignee of any Lender's
interest in and to this Agreement, the Notes or 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 pro-
ceeding 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.
9.17 No Joint Venture or Partnership. Borrower and Lenders intend that
the relationships created hereunder and under the other Loan Documents and be
solely that of borrower and lender. Nothing contained herein or therein (i)
shall constitute any Lender or any of their Affiliates as members of any
partnership, joint venture, association or other separate entity with Bor-
rower, its Affiliates or any other entities, (ii) shall be construed to
impose any liability as such on any Lender or any of their Affiliates, or
(iii) shall constitute a general or limited agency or be deemed to confer on
either party hereto any express, implied or apparent authority to incur any
obligation or liability on behalf of the other.
9.18 Publicity. On and after the Closing Date, Lenders and their
Affiliates shall be entitled, but not required, to advertise the transactions
contemplated hereby from time to time in media selected by Lenders or their
Affiliates at their expense. On and after the Closing Date, Borrower shall
be entitled, but not required, to advertise the same from time to time in
media selected by Borrower at its expense, provided that Borrower's adver-
tisements shall include a disclosure, in each case approved in writing by
Agent (not to be unreasonably withheld or delayed), that Lenders originated
the Loans.
9.19 Waiver of Counterclaim. Borrower hereby waives the right to
assert a counterclaim, other than a compulsory counterclaim, in any action or
proceeding brought against it by Agent, any Lender or their agents, but Bor-
rower does not waive its right to assert any such claim in a separate action.
9.20 Conflict; Construction of Documents. 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 counsel in connection with the
negotiation and drafting of the Loan Documents and other documents and
instruments executed and delivered in connection therewith and that such Loan
Documents and other documents and instruments shall not be subject to the
principle of construing their meaning against the party which drafted the
same.
9.21 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. Borrower hereby agrees to indemnify and hold harmless
Lenders and their Affiliates and their respective agents, representatives and
employees from and against any and all claims, liabilities, costs and
expenses of any kind in any way relating to or arising from a claim by any
Person that such Person acted on behalf of Borrower or its Affiliates in
connection with the transactions contemplated herein. The provisions of this
Section 9.21 shall survive the expiration and termination of this Agreement
and the repayment of the Indebtedness.
9.22 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.
9.23 Maximum Rate of Interest. This Agreement, the Notes and the other
Loan Documents are subject to the express condition that at no time shall
Borrower be obligated or required to pay interest on the Loans at a rate that
could subject Lenders to either civil or criminal liability as a result of
such rate being in excess of the highest lawful rate permitted under
applicable usury law to be charged to Borrower (the "Maximum Rate"). If, by
the terms of this Agreement, the Notes or any of the other Loan Documents,
Borrower is at any time required or obligated to pay interest on the Loans at
a rate in excess of such Maximum Rate, the rate of interest applicable to the
Loans shall be deemed to be immediately reduced to such Maximum Rate and the
interest payable shall be computed at such Maximum Rate and all prior
interest payments in excess of such Maximum Rate shall be deemed to have been
the result of a mistake on the part of both Borrower and Lenders, and Lenders
shall promptly credit such excess (to the extent only of such interest pay-
ments in excess of the Maximum Rate) against the unpaid principal amount of
the Loans to which such excess may lawfully be credited, and any portion of
such excess payments not capable of being so credited shall be refunded to
Borrower or otherwise disposed of as directed by the order of a court of
competent jurisdiction.
9.24 Attorneys' Fees. In the event of any litigation, arbitration or
other dispute resolution proceedings between the parties hereto arising out
of or relating to this Agreement or the transactions contemplated hereby, the
party prevailing in such litigation, arbitration or proceeding shall be
entitled to recover from the other party the reasonable attorney's fees and
disbursements incurred by such prevailing party in connection with such
litigation, arbitration or proceeding.
9.25 Counterparts. This Agreement and any amendments, waivers,
consents or supplements hereto or in connection herewith may be executed in
any number of counterparts, each of which when so executed and delivered
shall be deemed an original, but all such counterparts together shall
constitute but one and the same instrument; signature pages may be detached
from multiple separate counterparts and attached to a single counterpart so
that all signature pages are physically attached to the same document.
9.26 Application of Payments. Except as otherwise provided in this
Agreement and the other Loan Documents, each and every payment made by Bor-
rower to Agent in accordance with the terms of this Agreement and the other
Loan Documents and all other proceeds received by Agent with respect to the
Indebtedness shall be applied in the following order of priority: (i) to pay
the costs and expenses of Agent and Lenders for which Agent and Lenders are
entitled to reimbursement from Borrower under this Agreement or the other
Loan Documents, and that have not previously been reimbursed by Borrower,
together with accrued interest thereon (if any); then (ii) to ratably pay
accrued interest on the Loans, including interest accrued at the Default Rate
(if any); and then (iii) to ratably reduce the outstanding principal amount
of the Loans.
9.27 Assignments and Participations.
(a) Each Lender may assign, to one or more banks or other
financial institutions regularly engaged in making or acquiring loans,
all or a portion of its interests, rights and obligations under this
Agreement (including all or a portion of its Commitment and the Loans
at the time owing to it); provided, however, that (i) Agent (in its
sole discretion) must give its prior written consent to such
assignment, (ii) if no Event of Default and/or monetary Default shall
then exist and be continuing, Borrower must give its prior written
consent to such assignment, which consent shall not be unreasonably
withheld or delayed and if an Event of Default or a monetary Default
shall be so continuing, then Borrower's consent shall not be required,
(iii) each such assignment shall be of a constant, and not a varying,
percentage of all the assigning Lender's rights and obligations under
this Agreement as a Lender and the other Loan Documents, (iv) the
aggregate amount of the Loans and Commitment of the assigning Lender
subject to each such assignment (determined as of the date the
Assignment and Acceptance with respect to such assignment is delivered
to Agent) shall not be less than $10,000,000 unless such Lender's then
outstanding Loans and Commitment is less than $10,000,000 in which
event such Lender may assign the aggregate amount of the Loans made by
such Lender and its entire Commitment to make Loans, (v) the parties to
each such assignment shall execute and deliver to Agent an Assignment
and Acceptance, and a processing fee of $5,000 and (vi) if no Default
and/or Event of Default shall then be continuing, Bankers agrees to
retain at least a 22.2222% interest in the Loans. Upon the later of
acceptance pursuant to this Section, and the effective date specified
in each Assignment and Acceptance, which effective date shall be at
least five (5) Business Days after the execution thereof, (A) the
assignee thereunder shall be a party hereto and, to the extent provided
in such Assignment and Acceptance, have the rights and obligations
under this Agreement and the other Loan Documents, and (B) the assign-
ing Lender thereunder shall, to the extent provided in such assignment,
be released from its obligations under this Agreement and the other
Loan Documents (and, in the case of an Assignment and Acceptance cover-
ing all or the remaining portion of an assigning Lender's rights and
obligations under this Agreement and the other Loan Documents, such
assigning Lender shall cease to be a party hereto, but it shall
continue to receive the benefit of the indemnifications referred to or
provided for in, Section 9.14). Borrower shall execute replacement
Notes (in the form of Exhibit B) in connection with any such
assignment.
(b) By executing and delivering an Assignment and Accep-
tance, the assigning Lender thereunder and the assignee thereunder
shall be deemed to confirm to and agree with each other and the other
parties hereto as follows: (i) other than the representation and
warranty that it is the legal and beneficial owner of the interest
being assigned thereby free and clear of any adverse claim, such
assigning Lender makes no representation or warranty and assumes no
responsibility with respect to any statements, warranties or represen-
tations made in or in connection with this Agreement or any of the
other Loan Documents, or the execution, legality, validity,
enforceability, genuineness, sufficiency or value of this Agreement or
any of the other Loan Documents, or any other instrument or document
furnished pursuant hereto; (ii) such assigning Lender makes no
representation or warranty and assumes no responsibility with respect
to the financial condition of Borrower or any other Person or the per-
formance or observance by Borrower any other Person of any of its obli-
gations under this Agreement or any of the other Loan Documents, or any
other instrument or document furnished pursuant hereto; (iii) such
assignee confirms that it has received a copy of this Agreement and the
other Loan Documents and such other documents and information as it has
deemed appropriate to make its own credit analysis and decision to
enter into such Assignment and Acceptance; (iv) such assignee will
independently and without reliance upon Agent, such assigning Lender or
any other Lender and based on such documents and information as it
shall deem appropriate at the time, continue to make its own credit
decisions in taking or not taking action under this Agreement; (v) such
assignee appoints and authorizes Agent to take such action as agent on
its behalf and to exercise such powers under this Agreement and the
other Loan Documents as are delegated to Agent by the terms hereof and
thereof, together with such powers as are reasonably incidental
thereto; and (vi) such assignee agrees that it will perform in
accordance with their terms all the obligations which by the terms of
this Agreement and the other Loan Documents are required to be per-
formed by it as a Lender.
(c) Upon its receipt of a duly completed Assignment and
Acceptance executed by an assigning Lender and assignee together with
the processing fee referred to in Section 9.27(a) above and the written
consent of Agent (and of Borrower, if required) to such assignment
Agent shall (i) accept such Assignment and Acceptance, (ii) record the
information contained therein in the Register, and (iii) give prompt
notice thereof to Borrower and Lenders.
(d) Each Lender may without the consent of Borrower, but
upon the prior written consent of Agent, sell participations to one or
more banks or other financial institutions regularly engaged in making
or acquiring loans in all or a portion of its rights and obligations
under this Agreement (including all or a portion of its Commitment and
the Loans owing to it); provided, however, that (i) such Lender's obli-
gations under this Agreement shall remain unchanged, (ii) such Lender
shall remain solely responsible to the other parties hereto for the
performance of such obligations, (iii) the participating banks or other
entities shall be entitled to the benefit of the provisions contained
in Sections 2.5, 2.9, 2.10 and 9.14 as if such Participant were a
Lender, and (iv) Borrower, Agent and 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 such Lender
shall retain the sole right to enforce the obligations of Borrower,
Guarantors and Standby Purchasers relating to the Loans and to approve
any amendment, modification or waiver of any provision of this
Agreement or any of the other Loan Documents (but with respect to the
matters referred to in the last sentence of Section 9.4 a Lender may
allow its participant to have approval rights with respect thereto).
(e) Any Lender may, in connection with any assignment or
participation or proposed assignment or participation pursuant to this
Section, disclose to the assignee or participant or proposed assignee
or participant any information relating to Borrower any Guarantor or
any Standby Purchaser, their respective Affiliates furnished to each
such Lender by or on behalf of Borrower, Guarantors and/or Standby Pur-
chasers.
(f) Any Lender which is organized under the laws of any
jurisdiction other than the United States or any state or other
political subdivision thereof shall, and if pursuant to Section
9.27(a), any interest in this Agreement is assigned to any other bank
or financial institution, the assigning Lender shall cause the
assignee, concurrently with the effectiveness of such assignment to
(i) furnish to Borrower either U.S. Internal Revenue Service Form 4224
or U.S. Internal Revenue Form 1001 (or such other forms or certificates
wherein such assignee claims entitlement to complete exemption from or
reduction of U.S. federal withholding tax on all interest payments
hereunder) and (ii) agree (for the benefit of Borrower) to provide Bor-
rower a new form upon the expiration or obsolescence of any previously
delivered form and comparable statements in accordance with applicable
U.S. laws and regulations and amendments duly executed and completed by
such assignee, and to comply from time to time with all applicable U.S.
laws and regulations with regard to such withholding tax exemption.
Notwithstanding anything to the contrary herein, nothing in this
Section 9.27(f) shall require a Lender to provide a form which it is
not legally permitted to provide.
9.28 Setoff. Upon the occurrence of an Event of Default, Agent and
each Lender is hereby authorized, at any time or from time to time, without
prior notice to Borrower or any other Person, any such notice being hereby
expressly waived, to set off and to appropriate and apply any and all
deposits (general or special) and any other indebtedness or property at any
time held or owing by Agent or any Lender to or for the credit or the account
of Borrower, whether or not related to this Agreement or any transaction or
occurrence hereunder, against and on account of the indebtedness and other
liabilities of Borrower to Agent or any Lender hereunder, under the Notes
and/or under any of the other Loan Documents, whether or not Agent or any
Lender shall have made any demand hereunder and although such liabilities, or
any of them, shall be contingent or unmatured. The rights and remedies
granted to Agent and each Lender under this Section shall be in addition to,
and not in substitution for, any rights or remedies, including, without
limitation, any right of set-off or banker's lien, to which Agent or any
Lender may otherwise be entitled.
9.29 Liability of Borrower's Trustees, etc. Notwithstanding any
provision of this Agreement to the contrary, this Agreement has been executed
and delivered by a duly authorized officer of Borrower, for and on behalf of
Borrower's trustees. The Agent and each Lender each acknowledges that
neither the trustees of Borrower, nor any additional or successor trustees of
Borrower, nor any beneficiary, officer, employee or agent of Borrower, shall
have any personal, individual liability hereunder or under any of the Loan
Documents.
9.30 Employee Termination Expenses. Notwithstanding anything herein to
the contrary, for the purposes of this Agreement and of the Line of Credit
Facility (as incorporated herein), including, without limitation, for the
purposes of Section 7.20 of the Line of Credit Facility, employee termination
expenses of up to $8,500,000 incurred from and after the date hereof shall be
disregarded.
9.31 Conflicts with Intercreditor Agreement. If any term or provision
of this Agreement relating to the application of monies conflicts with the
provisions of the Intercreditor Agreement, the terms and provisions of the
Intercreditor Agreement shall take precedence over such conflicting
provisions of this Agreement.
X. AGENT; SUCCESSOR AGENT
10.1 Appointment. Bankers Trust Company is hereby appointed Agent
hereunder and under the other Loan Documents and each Lender hereby
authorizes Agent to act as its agent in accordance with the terms of this
Agreement and the other Loan Documents. Agent agrees to act upon the
express conditions contained in this Agreement and the other Loan Documents,
as applicable. The provisions of this Article X are solely for the benefit
of Agent and Lenders and Borrower shall not have any right as third-party
beneficiary of any of the provisions hereof. In performing its functions and
duties under this Agreement, Agent shall act solely as an agent of Lenders
and does not assume and shall not be deemed to have assumed any obligation
towards or relationship of agency or trust with or for Borrower or any
Affiliate of Borrower.
10.2 Powers and Duties; General Immunity.
10.2.1 Powers; Duties. Each Lender irrevocably authorizes
Agent to deal and communicate with Borrower on such Lender's behalf in all
respects under and in connection with the Loan Documents. Borrower shall
have no obligation to recognize or deal directly with Lenders nor to comply
with any demand or requirement made by any Lender (other than through Agent),
and no Lender shall deal directly with Borrower with respect to the rights,
benefits and obligations of Borrower under the Loan Documents or any one or
more documents or instruments in respect thereof. Borrower shall be entitled
to rely conclusively on the actions of Agent as agent to bind Lenders,
notwithstanding that the particular action in question may, pursuant to the
terms of such agreements as may exist from time to time among the Agent and
Lenders, be subject, as among the Agent and Lenders, to the approval or
direction of Lenders or any specified percentage of Lenders. Agent may exer-
cise its powers, rights and remedies and perform its duties hereunder by or
through its agents or employees. Agent shall not have, by reason of this
Agreement or any of the other Loan Documents, a fiduciary relationship in
respect of any Lender; and nothing in this Agreement or any of the other Loan
Documents, expressed or implied, is intended to or shall be so construed as
to impose upon Agent any obligations in respect of this Agreement or any of
the other Loan Documents except as expressly set forth herein or therein.
10.2.2 Agent Entitled to Act as Lender. The agency hereby
created shall in no way impair or affect any of the rights and powers of, or
impose any duties or obligations upon, Agent in its individual capacity as a
Lender hereunder. With respect to its participation in the Loans, Agent
shall have the same rights and powers hereunder as any other Lender and may
exercise the same as though it were not performing the duties and functions
delegated to it hereunder, and the term "Lender" or "Lenders" or any similar
term shall, unless the context clearly otherwise indicates, include Agent in
its individual capacity. Agent and its Affiliates may accept deposits from,
lend money to and generally engage in any kind of banking, trust, financial
advisory or other business with Borrower or any Standby Purchaser or any of
their respective Affiliates as if it were not performing the duties specified
herein, and may accept fees and other consideration from Borrower or any
Standby Purchaser for services in connection with this Agreement and other-
wise without having to account for the same to Lenders.
10.3 Representations and Warranties; No Responsibility for Appraisal of
Creditworthiness. Each Lender hereby acknowledges that such Lender has been
furnished with copies of such Loan Documents, financial statements, certifi-
▇▇▇▇▇, instruments, documents, affidavits, resolutions, reports, and agree-
ments (collectively, the "Pre-Closing Documentation") as such Lender has
deemed necessary to make its own credit analysis and decision with respect to
the Loans. Each Lender acknowledges that it has, independently and without
reliance upon Agent and based on such documents and information as it has
deemed appropriate, made its own credit analysis and decision to enter into
this Agreement and to extend credit to the Borrower on the terms set forth in
this Agreement and the other Loan Documents. Each Lender also acknowledges
to Agent that such Lender will, independently and without reliance upon Agent
and based on the Pre-Closing Documentation and such other documents and
information as it shall deem appropriate at the time, make and continue to
make its own decision in taking or not taking action with respect to the
Loans. Lenders hereby acknowledge that Agent (i) shall not be responsible to
Lenders for any statements, warranties, or representations (written or other-
wise) by any party other than Agent made in or in connection with the Pre-
Closing Documentation, the Loans, or the Loan Documents, or the financial
condition of Borrower or the Standby Purchasers, any indemnitor or any other
person; and (ii) shall not be responsible to Lenders for the due execution,
legality, validity, enforceability, genuineness, sufficiency or
collectability of any of the Loan Documents or any other instrument or docu-
ment furnished pursuant thereto or in connection with the Loans.
10.4 Successor Agent. Agent may resign at any time by giving thirty
(30) days' prior written notice thereof to Lenders and Borrower, and Agent
may be removed for cause by Lenders by written Lender Approval, if such
written instrument is delivered to Borrower. Upon any such notice of
resignation or any such removal, Lenders shall have the right, by Lender
Approval, upon five (5) Business Days' notice to Borrower, to appoint a suc-
cessor Agent. Upon the acceptance of any appointment as Agent hereunder by a
successor Agent, that successor Agent shall thereupon succeed to and become
vested with all the rights, powers, privileges and duties of the retiring or
removed Agent and the retiring or removed Agent shall be discharged from its
duties and obligations under this Agreement. After any retiring or removed
Agent's resignation or removal hereunder as Agent, the provisions of this
Article X shall inure to its benefit as to any actions taken or omitted to be
taken by it while it was Agent under this Agreement.
XI. OFFERING
11.1 Rights Offering. Borrower shall use its best efforts to file with
the Securities and Exchange Commission within forty-five (45) days from the
Closing Date either (i) a registration statement or (ii) to the extent that
Borrower in good faith concludes that the Offering (as defined below) may be
conducted pursuant to a prospectus supplement to Borrower's existing shelf
registration statement (file no. 333-31695), a prospectus supplement (in
which case the number of days referred to above shall be sixty (60) days) or
(iii) a post-effective amendment to such shelf registration statement, in
each case in such form such that when the same is declared effective by the
Securities and Exchange Commission or, in the case of clause (ii) above,
filed with the Securities and Exchange Commission, Borrower will be able to
consummate an offering entitling holders of equity securities of Borrower to
purchase additional equity interests in Borrower on a pro rata basis (the
"Offering") which, if fully subscribed, would result in aggregate proceeds to
Borrower of an amount at least sufficient to enable Borrower to prepay, upon
the consummation of the Offering, the Loans and the Other Loans (and all
interest and other fees or other amounts due in connection with the Loans and
the Other Loans), and Borrower shall use its best efforts to cause any such
registration statement or post-effective amendment referred to in clause (i)
or (iii) above to be declared effective within ninety (90) days from the
Closing Date. Borrower shall use its best efforts to take, or cause to be
taken, any and all further action or actions necessary or advisable to be
taken in order to enable the Offering to be consummated as contemplated by
this Section 11.1, including but not limited to the distribution of a
prospectus or prospectus supplement pursuant to any of the applicable
registration statements referred to above. It shall be an Event of Default
if the registration statement or post-effective amendment is not declared
effective or if the prospectus supplement is not filed with the Securities
and Exchange Commission, as the case may be, on or prior to the Initial
Maturity Date.
11.2 Consummation. After the filing of the registration statement,
post-effective amendment or prospectus supplement referred to in Section 11.1
above, for the Offering pursuant to Section 11.1, Borrower shall thereafter
diligently and continuously use its best efforts to consummate the Offering.
11.3 Proceeds of Offering. Upon Borrower's receipt of any proceeds of
the Offering, Borrower shall cease to have any right to borrow under this
Agreement.
11.4 Pricing of Rights Offering. The pricing of the securities to be
offered pursuant to the Offering shall be consistent with the pricing
parameters set forth in Section 7(d) of the Standby Purchase Agreements.
11.5 Waiver of Ownership Limitations. Borrower hereby covenants and
agrees to use its best efforts to cause to be issued to Gotham a waiver of
the ownership limitations set forth in Article VI, Section 6 of the By-Laws
of Borrower, in form and substance reasonably satisfactory to Gotham, to the
extent necessary (in light of all other securities of Borrower directly,
indirectly, beneficially or constructively owned or controlled by or subject
to the power to vote of (in each case, within the meaning of Borrower's
Organizational Documents, the Securities Exchange Act of 1934, as amended and
the rules and regulations thereunder, and the Internal Revenue Code and the
rules and regulations thereunder) Gotham to permit Gotham to acquire the
securities it may become obligated to purchase pursuant to the Standby
Purchase Agreement to which Gotham is a party; provided, however, that
notwithstanding the foregoing or any other provision of this Agreement,
(i) Borrower shall not be obligated to take any action hereunder which would
prevent Borrower from qualifying or continuing to qualify for taxation under
the Internal Revenue Code as a REIT, and (ii) Borrower shall not be prevented
or restricted hereunder with respect to taking any action which the Board of
Trustees of Borrower shall deem advisable to prevent disqualification of
Borrower for taxation under the Internal Revenue Code as a REIT.
11.6 Indemnification.
(a) Borrower agrees to indemnify and hold harmless Agent and
each Lender against any and all losses, claims, damages, obligations,
penalties, judgments, awards, liabilities, costs, expenses and disbursements
(and any and all actions, suits, proceedings and investigations in respect
thereof and any and all legal and other costs, expenses and disbursements in
giving testimony or furnishing documents in response to a subpoena or
otherwise), including, without limitation, the costs, expenses and
disbursements, as and when incurred, of investigating, preparing or defending
any such action, suit, proceeding or investigation (whether or not in
connection with litigation in which any Agent or any Lender is a party),
directly or indirectly, caused by, relating to, based upon, arising out of,
or in connection with, including, without limitation, any act or omission by
Agent or such Lender in connection with the Offering or any registration
statement or any prospectus relating to the Offering.
(b) These indemnification provisions shall be in addition to any
liability which Borrower may otherwise have to Agent or Lenders or the
persons indemnified below in this sentence and shall extend to the following:
Agent, Lenders, their respective affiliated entities, partners, employees,
legal counsel, agents and controlling persons (within the meaning of the
federal securities laws), and the officers, directors, employees, legal
counsel, partners, agents and controlling persons of any of them. All
references to Agent and/or Lender in these indemnification provisions shall
be understood to include any and all of the foregoing indemnitees.
(c) If any action, suit, proceeding or investigation is
commenced, as to which Agent or any Lender proposes to demand
indemnification, it shall notify Borrower with reasonable promptness;
provided, however, that any failure by Agent or any Lender to notify Borrower
shall not relieve Borrower from its obligations hereunder. Agent or any such
Lender, as the case may be, shall have the right to retain counsel of its own
choice to represent it, and Borrower shall pay the reasonable fees, expenses
and disbursements of such counsel; and such counsel shall, to the extent
consistent with its professional responsibilities, cooperate with Borrower
and any counsel designated by Borrower. Borrower shall not be liable for any
settlement of any claim against Agent or any Lender made without Borrower's
prior written consent, which consent shall not be unreasonably withheld.
Borrower shall not, without the prior written consent of Agent or any such
Lender, as the case may be, settle or compromise any claim, or permit a
default or consent to the entry of any judgment in respect thereof, unless
such settlement, compromise or consent includes, as an unconditional term
thereof, the giving by the claimant to Agent or any such Lender, as the case
may be, of an unconditional release from all liability in respect of such
claim.
(d) In order to provide for just and equitable contribution, if
a claim for indemnification pursuant to these indemnification provisions is
made but it is found in a final judgment by a court of competent jurisdiction
(not subject to further appeal) that such indemnification may not be enforced
in such case, even though the express provisions hereof provide for
indemnification in such case, then Borrower, on the one hand, and Agent or
any such Lender, as the case may be, on the other hand, shall contribute to
the losses, claims, damages, obligations, penalties, judgments, awards,
liabilities, costs, expenses, and disbursements to which the indemnified
persons may be subject in accordance with the relative benefits received by
Borrower, on the one hand, and Agent or any such Lender, as the case may be,
on the other hand, and also the relative fault of Borrower, on the one hand,
and Agent or any such Lender, as the case may be, on the other hand, in
connection with the statements, acts or omissions which resulted in such
losses, claims, damages, obligations, penalties, judgments, awards,
liabilities, costs, expenses or disbursements and the relevant equitable
considerations shall also be considered. No person found liable for a
fraudulent misrepresentation shall be entitled to contribution from any
person who is not also found liable for such fraudulent misrepresentation.
Notwithstanding the foregoing, neither Agent nor any Lender shall be
obligated to contribute any amount hereunder that exceeds the amount of fees
previously received by Agent or such Lender, as the case may be, pursuant to
this Agreement.
(e) These indemnification provisions and the provisions of
Section 9.14 shall survive any termination of this Agreement and thereafter
shall remain operative and in full force and effect.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement
to be duly executed by their duly authorized representatives, all as of the
day and year first above written.
LENDER and AGENT:
BANKERS TRUST COMPANY
By: /s/ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
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Name: ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: Managing Director
LENDERS:
BANKBOSTON, N.A.
By:/s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
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Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Managing Director
WELLSFORD CAPITAL
By:/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
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Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title:Chief Financial Officer
BORROWER:
FIRST UNION REAL ESTATE EQUITY AND
MORTGAGE INVESTMENTS
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
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Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: Senior Vice President
Treasurer