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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
(GOTHAM GROUP)
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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................................................... 22
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..................................... 24
3.2.1 Casualty, Condemnation and Application of Proceeds... 24
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.............................. 29
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................................... 33
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..................................................... 34
7.1 Borrower Negative Covenants................................... 34
7.1.1 Debt................................................. 34
7.1.2 Corporate Structure.................................. 34
7.1.3 Incorporation of Negative Covenants.................. 34
VIII. DEFAULTS............................................................... 35
8.1 Event of Default.............................................. 35
8.2 Remedies...................................................... 37
8.3 Remedies Cumulative........................................... 38
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................................................... 43
9.11 Waiver of Notice.............................................. 43
9.12 Remedies of Borrower.......................................... 43
9.13 Non-Exculpation............................................... 43
9.14 Expenses; Indemnity........................................... 44
9.15 Exhibits, Schedules Incorporated.............................. 46
9.16 Offsets, Counterclaims and Defenses........................... 46
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................................ 47
9.22 Prior Agreements.............................................. 47
9.23 Maximum Rate of Interest...................................... 47
9.24 Attorneys' Fees............................................... 47
9.25 Counterparts.................................................. 48
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........................ 52
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...................... 53
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.......................................... 55
11.4 Pricing of Rights Offering.................................... 55
11.5 Waiver of Ownership Limitations............................... 55
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 BLACKACRE BRIDGE CAPITAL, L.L.C.,
a New York limited liability company, having an address at ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, GOTHAM PARTNERS, L.P., a New York
limited partnership, having an address at ▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇,
▇▇▇ ▇▇▇▇ ▇▇▇▇▇, GOTHAM PARTNERS III, L.P., a New York limited partnership,
having an address at ▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ and
▇▇▇▇▇▇▇ ASSOCIATES, L.P., a Delaware limited partnership, 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,
subject 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 and of
Gotham Partners International, Ltd. and Gotham Partners II, L.P.
"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 Person 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)
commencing 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 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) 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 which 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 Property which it intends to use for substantially the
same purposes as the Property 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,
condemnation, 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
otherwise.
"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'
compensation, 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 indirectly 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 purchase, 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
January 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
property, 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 both of such
entities or to each 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
Documents, and all other covenants, obligations and liabilities of Borrower
hereunder 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
person 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
Lenders. Lender Approval or approval by the Required Lenders, except as
otherwise 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,
hypothecation, assignment, security interest, security title, or any other
encumbrance, 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
otherwise 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
Condemnation 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 Person, 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, Bankers
Trust Company, BankBoston, N.A. and Wellsford Capital, 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
partnership, 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 Section
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
outstanding, 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 Purchaser 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
sections, 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 under the Other Loan Agreement
Borrower will not borrow hereunder. 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 Section 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 Agreement
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
hereunder. 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 hereunder. 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
prepayment 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 Section
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
prepayment 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 additional amount or amounts as will
compensate such Lender or such controlling corporation 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.
(a) Borrower agrees to pay to each Lender on the Closing
Date a non-refundable commitment fee (each a "COMMITMENT FEE" and
collectively the "COMMITMENT 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.
(b) Notwithstanding anything to the contrary contained
herein, any fee otherwise payable to ▇▇▇▇▇▇▇ hereunder, including but
not limited to the Extension Fee and the Commitment Fee, may be
assigned by ▇▇▇▇▇▇▇ to an affiliate of ▇▇▇▇▇▇▇.
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 Borrower
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
performed 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
hereunder 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 obligations
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 obligations 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
prepayment) 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
satisfactory 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
deliver 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
compliance 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
endorsements, 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
Agreement. 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
certificate 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 evidence
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
prepayment 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 performed
in all material respects all agreements and satisfied all conditions
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 Sections
856 through 860 of the Internal Revenue Code. Borrower is duly qualified to
do business in each jurisdiction where it is required to be so qualified in
connection with its Properties, businesses and operations where the failure
so to qualify would have a material adverse effect on Borrower. Borrower
possesses all rights, licenses, permits and authorizations, governmental 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 corporate,
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 performance 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 Borrower
is not contemplating either the filing of a petition by it under any state
or federal bankruptcy or insolvency laws or the liquidation of 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
performance 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 Exchange 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 acknowledged
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 Credi Facility; and (c) non-recourse mortgage Debt for the
purpose 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
Agreement.
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
principal of, or interest on, the Loans on the date on which such
payment 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
pursuant 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
Borrower or any Standby Purchaser herein or in any other Loan
Document, 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
Bankruptcy, reorganization or arrangement pursuant to federal
Bankruptcy law, or any similar federal or state law, shall be
filed by or against, consented to, or acquiesced in by Borrower
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 described
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
attachment 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
direction 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
Borrower 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,
without 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 right 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,
representations and warranties made herein and in the certificates
delivered pursuant 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 Indebtedness 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
Agreement 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 ss. 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 ss. 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 Borrower mailed or delivered to Borrower in the manner
provided herein shall be deemed in every respect effective service of
process upon Borrower, in any such suit, action or proceeding in the
State of New York. Borrower (i) shall give prompt notice to 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 substitute 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 provided for in 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 Purchaser 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 or (ix) permit Borrower to
assign any of its rights or obligations under the Loan Documents.
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
Agreement, 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 Documents, 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 AGREEMENTS 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
thereof are subsequently invalidated, declared to be fraudulent or
preferential, set aside or required to be repaid to a trustee, receiver or
any other party under any bankruptcy law, state or federal law, common law
or equitable cause, then, to the extent of such payment or proceeds
received, the obligations hereunder or 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. Borrower 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 connection 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)
incurred 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
Documents, 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 Borrower, 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
transactions 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 negligence, 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
beneficiary 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
Borrower 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 opportunity 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 proceeding brought by any such assignee upon such documents and
any such right to interpose or assert any such unrelated offset,
counterclaim or defense in any such action or proceeding is hereby
expressly waived by Borrower.
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
Borrower, 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 advertisements 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
Borrower 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 payments 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
Borrower 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, and (v) the
parties to each such assignment shall execute and deliver to Agent an
Assignment and Acceptance, and a processing fee of $5,000. 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 assigning 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 covering 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
Acceptance, 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
representations 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
performance or observance by Borrower any other Person of any of its
obligations 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 performed 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
obligations 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
Purchasers.
(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 Borrower 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.
(g) Notwithstanding anything to the contrary contained in
this Section 9.27, each Lender, upon prior written notice to, but
without the consent of, Agent and Borrower, may assign or sell
participations in any or all of its respective Loan to an Affiliate of
such Lender.
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 exercise 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 otherwise 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,
certificates, instruments, documents, affidavits, resolutions, reports, and
agreements (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 otherwise) 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 document 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
successor 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 Securitie 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 the
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 or result in Borrower becoming disqualified 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, as 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, as
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, as 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, as 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.
AGENT:
BANKERS TRUST COMPANY
By:
-----------------------------------
Name:
Title:
LENDERS:
BLACKACRE BRIDGE CAPITAL, L.L.C.
By: Blackacre Capital Management
Corp., a Connecticut corporation,
as managing member
By:
-----------------------------
Name:
Title:
GOTHAM PARTNERS, L.P. and
GOTHAM PARTNERS III, L.P.
By: Section H Partners, L.P.
By: Karenina Corp.
By:
-----------------------------
Name:
Title:
▇▇▇▇▇▇▇ ASSOCIATES, L.P.
By:
-----------------------------------
Name:
Title: General Partner
BORROWER:
FIRST UNION REAL ESTATE EQUITY AND
MORTGAGE INVESTMENTS
By:
-----------------------------------
Name:
Title:
