Exhibit 10.32
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LOAN AGREEMENT
Dated as of December 9, 1999
Between
ANNAPOLIS SHOPPINGTOWN LLC,
as Borrower
ANNAPOLIS MALL LIMITED PARTNERSHIP
and
ANNAPOLIS LAND LLC,
as Owner
And
UBS PRINCIPAL FINANCE LLC,
as Lender
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TABLE OF CONTENTS
Page
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I DEFINITIONS: PRINCIPLES OF CONSTRUCTION.................................1
1.1 Specific Definitions............................................1
1.2 Index of Other Definitions.....................................20
1.3 Principles of Construction.....................................22
II THE LOAN...............................................................22
2.1 The Loan.......................................................22
2.1.1 Commitment..............................................22
2.1.2 Note....................................................22
2.1.3 Use of Loan Proceeds....................................22
2.2 Conditions Precedent to Closing................................22
2.2.1 Representations and Warranties; Compliance with
Conditions ............................................22
2.2.2 First Mortgage and Loan Documents.......................23
2.2.3 Title Insurance.........................................23
2.2.4 Environmental Audit.....................................23
2.2.5 Insurance...............................................23
2.2.6 Financial Statements....................................24
2.2.7 Searches................................................24
2.2.8 Survey..................................................24
2.2.9 Management..............................................24
2.2.10 Leases and Material Contracts ..........................24
2.2.11 UBS Letter of Credit ...................................24
2.2.12 Tenant Estoppels .......................................24
2.2.13 Property Condition Report ..............................24
2.2.14 Appraisal ..............................................25
2.2.15 Zoning Compliance, Etc .................................25
2.2.16 Recording Taxes ........................................25
2.2.17 Perfection of Security Interests .......................25
2.2.18 Opinions of Owner's and Borrower's Counsel .............25
2.2.19 Intentionally Deleted ..................................25
2.2.20 REA ....................................................25
2.2.21 Reserves and Escrows ...................................26
2.2.22 Rent Roll ..............................................26
2.2.23 Further Documents ......................................26
2.2.24 Completion of Proceedings ..............................26
2.2.25 Delivery of Organizational Documents ...................26
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2.2.26 Expenses ...............................................26
2.2.27 Tax Lot ................................................26
2.2.28 Encumbrances ...........................................26
2.3 Intentionally Deleted..........................................26
2.4 Defeasance.....................................................26
2.4.1 Defeasance..............................................27
2.4.2 Intentionally Deleted ..................................28
2.4.3 Defeasance Collateral Account. .........................28
2.4.4 Successor Borrower. ....................................28
III INTEREST; PAYMENTS.....................................................29
3.1 Interest; Monthly Loan Payments................................29
3.1.1 Interest Generally......................................29
3.1.2 Payment Before Anticipated Repayment Date...............29
3.1.3 Payment After Anticipated Repayment Date................29
3.1.4 Payment on Maturity Date................................29
3.1.5 Property Cash Flow Allocation...........................29
3.1.6 Payments after Default; Default Rate....................30
3.2 Loan Repayment; Voluntary Prepayment; Prepayment
After Default.................................................30
3.2.1 Repayment...............................................30
3.2.2 Mandatory Prepayments...................................31
3.3 Release of Property............................................31
3.3.1 Release of Collateral Property..........................31
3.3.2 Release on Payment in Full..............................32
3.3.3 Release Documents.......................................32
3.3.4 Release of Funds........................................32
3.4 Payments and Computations......................................32
3.4.1 Making of Payments......................................32
3.4.2 Interest Calculation....................................32
3.4.3 Late Payment Charge.....................................32
3.5 Taxes..........................................................33
IV CASH MANAGEMENT; ESCROWS AND RESERVES..................................33
4.1 Cash Management Arrangements...................................33
4.1.1 Lockbox Account.........................................33
4.1.2 Deposits into Lockbox Account...........................34
4.1.3 The Accounts............................................34
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4.2 Letter of Credit Proceeds Fund.................................34
4.3 Tax and Insurance Escrow Fund..................................35
4.4 Replacements and Replacement Reserves..........................36
4.4.1 Replacement Reserve Fund................................36
4.4.2 Payment of Replacement Expenses.........................37
4.5 Rollover Reserves..............................................37
4.5.1 Rollover Reserve Fund...................................37
4.5.2 Payment of Leasing Expenses.............................38
4.6 Construction Interest Reserve..................................38
4.6.1 Construction Interest Reserve Fund......................38
4.7 Operating Expense Reserves.....................................39
4.7.1 Operating Expense Reserve Fund..........................39
4.7.2 Payment of Approved Operating Expenses..................39
4.8 Casualty/Condemnation Fund.....................................40
4.9 Security Deposits..............................................40
4.10 Funds, Generally...............................................41
4.10.1 Grant of Security Interest; Application of Funds .......41
4.10.2 Investments of Funds ...................................41
4.11 Cash Collateral Fund...........................................42
V REPRESENTATIONS AND WARRANTIES.........................................42
5.1 Owner and Borrower Representations.............................42
5.1.1 Organization; Special Purpose...........................42
5.1.2 Proceedings; Enforceability.............................43
5.1.3 No Conflicts............................................43
5.1.4 Litigation..............................................43
5.1.5 Agreements..............................................43
5.1.6 Title...................................................43
5.1.7 Survey..................................................44
5.1.8 No Bankruptcy Filing....................................44
5.1.9 Full and Accurate Disclosure............................44
5.1.10 No Plan Assets .........................................44
5.1.11 Compliance .............................................44
5.1.12 Contracts ..............................................45
5.1.13 Financial Information ..................................45
5.1.14 Condemnation ...........................................45
5.1.15 Federal Reserve Regulations ............................45
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5.1.16 Utilities and Public Access ............................45
5.1.17 Not a Foreign Person ...................................46
5.1.18 Separate Lots ..........................................46
5.1.19 Assessments ............................................46
5.1.20 Enforceability .........................................46
5.1.21 Insurance ..............................................46
5.1.22 Use of Property; Licenses ..............................46
5.1.23 Flood Zone .............................................46
5.1.24 Physical Condition .....................................46
5.1.25 Boundaries and Encroachments ...........................47
5.1.26 Leases and Rent Roll ...................................47
5.1.27 Filing and Recording Taxes .............................48
5.1.28 Investment Company Act .................................48
5.1.29 Fraudulent Transfer ....................................48
5.1.30 Ownership of Owner and Borrower ........................48
5.1.31 Management Agreement ...................................49
5.1.32 Hazardous Substances ...................................49
5.1.33 Name; Principal of Business ............................49
5.1.34 Subordinated Debt ......................................50
5.1.35 Intentionally Deleted ..................................50
5.1.36 REA ....................................................50
5.1.37 Tenant Estoppels .......................................50
5.1.38 No Prior Assignment ....................................50
5.1.39 Special Purpose Entity/Separateness ....................50
5.1.40 Illegal Activity .......................................51
5.2 Survival of Representations and Covenants......................51
VI AFFIRMATIVE COVENANTS..................................................51
6.1 Existence......................................................51
6.2 Taxes and Other Charges........................................51
6.3 Repairs; Maintenance and Compliance; Alterations;
Required Repairs 52
6.3.1 Repairs and Maintenance.................................52
6.3.2 Legal Compliance........................................52
6.3.3 Alterations.............................................52
6.3.4 New Construction........................................53
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6.4 Litigation.....................................................53
6.5 Performance of Other Agreements................................54
6.6 Notices........................................................54
6.7 Cooperate in Legal Proceedings.................................54
6.8 Further Assurances.............................................54
6.9 Financial Reporting............................................54
6.9.1 Bookkeeping.............................................54
6.9.2 Annual Reports..........................................55
6.9.3 Monthly and Quarterly Reports...........................55
6.9.4 Other Reports...........................................56
6.9.5 Annual Budget...........................................56
6.9.6 Delivery of Financial Information.......................56
6.10 Environmental Matters..........................................56
6.10.1 Hazardous Substances ...................................56
6.10.2 Environmental Monitoring ...............................57
6.10.3 Title to the Property ..................................59
6.10.4 Easements; Dedications .................................59
6.11 Leases.........................................................59
6.11.1 Form of Lease ..........................................59
6.11.2 New and Renewal Leases .................................59
6.11.3 Leasing Covenants ......................................60
6.11.4 Non-disturbance Agreements .............................60
6.11.5 Reciprocal Easement Agreements .........................60
6.11.6 Notice to Tenants ......................................60
6.12 Estoppel Statement.............................................60
6.13 Property Management............................................61
6.13.1 Management Agreement ...................................61
6.13.2 Termination of Manager .................................61
6.13.3 Manager's Subordination ................................61
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6.14 Special Purpose Entity.........................................61
6.15 Expenses.......................................................61
6.16 Indemnity......................................................62
6.17 Third Party Reports............................................63
6.18 Year 2000 Compliance...........................................63
6.19 Intentionally Deleted..........................................64
6.20 Performance by Owner and Borrower..............................64
6.21 Secondary Market Transaction Master Estoppel...................64
6.22 Intentionally Deleted..........................................64
VII NEGATIVE COVENANTS.....................................................64
7.1 Management Agreement...........................................64
7.2 Liens..........................................................65
7.3 Dissolution....................................................65
7.4 Change In Business or Operation of Property....................65
7.5 Debt Cancellation..............................................65
7.6 Assets.........................................................65
7.7 Transfers......................................................65
7.8 Debt...........................................................68
7.9 Assignment of Rights...........................................68
7.10 Principal Place of Business....................................68
7.11 Corporate Organization.........................................68
7.12 ERISA..........................................................69
7.13 No Joint Assessment............................................69
7.14 Affiliate Transactions.........................................69
VIII INSURANCE..............................................................70
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8.1.1 Coverage................................................70
8.1.2 Policies................................................71
8.2 Casualty.......................................................71
8.2.1 Notice; Restoration.....................................71
8.2.2 Settlement of Proceeds..................................72
8.3 Condemnation...................................................72
8.3.1 Notice; Restoration.....................................72
8.3.2 Collection of Award.....................................72
8.4 Application of Proceeds or Award...............................72
8.4.1 Application to Restoration..............................72
8.4.2 Application to Debt.....................................73
8.4.3 Procedure for Application to Restoration................73
8.4.4 Anchor Lease; REA.......................................74
IX DEFAULTS...............................................................74
9.1 Events of Default..............................................74
9.2 Remedies.......................................................76
9.2.1 Acceleration............................................76
9.2.2 Remedies Cumulative.....................................76
9.2.3 Severance...............................................77
9.2.4 Delay...................................................77
9.2.5 Lender's Right to Perform...............................77
X SPECIAL PROVISIONS.....................................................77
10.1 Sale of Note and Secondary Market Transaction..................77
10.1.1 Cooperation ............................................77
10.1.2 Use of Information .....................................79
10.1.3 Owner's and Borrower's Obligations Regarding
Disclosure Documents ..................................79
10.1.4 Owner's and Borrower's Indemnity Regarding Filings .....80
10.1.5 Indemnification Procedure ..............................81
10.1.6 Contribution ...........................................81
XI MISCELLANEOUS..........................................................82
11.1 Exculpation....................................................82
11.2 Notices........................................................83
11.2.1 Owner's Representative; Borrower's Representative ......84
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11.3 Brokers and Financial Advisors.................................84
11.4 Retention of Servicer..........................................85
11.5 Survival.......................................................85
11.6 Lender's Discretion............................................85
11.7 Governing Law; Venue...........................................85
11.8 Modification; Waiver in Writing................................86
11.9 Delay Not a Waiver.............................................86
11.10 TRIAL BY JURY..................................................86
11.11 Heading........................................................87
11.12 Severability...................................................87
11.13 Preferences....................................................87
11.14 Waiver of Notice...............................................87
11.15 Remedies of Owner and Borrower.................................87
11.16 Prior Agreements...............................................87
11.17 Offsets, Counterclaims and Defenses............................88
11.18 Publicity......................................................88
11.19 No Usury.......................................................88
11.20 Conflict; Construction of Documents............................88
11.21 No Joint Venture or Partnership; No Third Party Beneficiaries..89
11.22 Yield Maintenance Premium......................................89
11.23 Assignment.....................................................90
11.24 Waiver of Marshalling of Assets................................90
11.25 Joint and Several Liability....................................90
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LOAN AGREEMENT
LOAN AGREEMENT dated as of December 9, 1999 between ANNAPOLIS SHOPPINGTOWN
LLC, a Delaware limited liability company (together with any permitted
successors and assigns, "Borrower"), ANNAPOLIS MALL LIMITED PARTNERSHIP, a
Maryland limited partnership ("AMLP"), as co-owner, and ANNAPOLIS LAND LLC, a
Delaware limited liability company (formerly known as WEA Annapolis, Inc.)
("AL"), as co-owner (AMLP and AL, together with any permitted successors and
assigns, are hereinafter collectively referred to as "Owner") and UBS PRINCIPAL
FINANCE LLC, a Delaware limited liability company (together with its successors
and assigns, "Lender").
I DEFINITIONS: PRINCIPLES OF CONSTRUCTION
1.1 Specific Definitions. The following terms have the meanings set forth
below:
"Acceptable Appraisal": an appraisal of the Collateral Property (i) dated
not more than 180 days prior to the Closing Date, (ii) signed by a qualified
MAI/FIRREA appraiser with no interest, direct or indirect, in the Loan, or the
Collateral Property, and whose compensation is not affected by the Appraised
Value (and Lender agrees that as of the date hereof ▇▇▇▇▇▇▇▇ Associates, Inc.
satisfies the foregoing criteria), (iii) addressed to Lender and its successors
and assigns, (iv) made in compliance with the Uniform Standards of Appraisal
Practice, and (v) otherwise reasonably satisfactory to Lender in all respects.
"ADA": shall mean The Americans with Disabilities Act of 1990.
"Affiliate": 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 or officer of such Person or of an Affiliate of
such Person.
"Agent": shall mean LaSalle National Bank.
"Agreement": this Loan Agreement.
"Anchor Tenant": shall mean any Tenant from time to time leasing more than
75,000 square feet of gross leasable area in the Collateral Property.
"Anticipated Repayment Date": shall mean December 11, 2009.
"Applicable Interest Rate": shall mean (a) from the date hereof through
but not including the Anticipated Repayment Date, the Regular Interest Rate and
(b) from and after the Anticipated Repayment Date through and including the date
the Loan is paid in full, the Matured Performing Rate.
"Applicable Rating Agencies": means the Rating Agencies that have rated
any Securities issued in connection with a Secondary Market Transaction.
"Appraised Value": the fair market value of the Collateral Property, as
reflected in an Acceptable Appraisal.
"Approved Leasing Expenses": expenses incurred by Owner or Borrower in
leasing space at the Collateral Property pursuant to Leases entered into in
accordance with the Loan Documents, including brokerage commissions, tenant
improvements and other inducements, which expenses (i) are (A) specifically
approved by Lender in connection with approving the applicable Lease, (B)
incurred in the ordinary course of business and on market terms and conditions
in connection with Leases which do not require Lender's approval under the Loan
Documents, or (C) otherwise approved by Lender, which approval shall not be
unreasonably withheld or delayed, and (ii) are substantiated by executed Lease
documents and brokerage agreements.
"Approved Manager": Westfield Management Company, a Delaware general
partnership, or Westfield Management Acquisition, Inc., a Delaware corporation,
or any other wholly owned subsidiary of Westfield Holdings Limited, or any
successor or assignee of any of the foregoing, provided that each successor or
assignee shall be (i) approved by Lender in Lender's reasonable discretion
(unless such successor or assign is wholly owned, directly or indirectly, by
Westfield Holdings Limited and evidence thereof reasonably satisfactory to
Lender has been delivered to Lender prior to the change in Manager, in which
case Lender's approval shall not be required) and (ii) after any Secondary
Market Transaction, approved by each Rating Agency (provided that such Rating
Agency approval shall not be necessary as to any Manager wholly owned, directly
or indirectly, by Westfield Holdings Limited if each Rating Agency has received
a nonconsolidation opinion as to such Manager from Debevoise & ▇▇▇▇▇▇▇▇ or
another law firm acceptable to the Rating Agencies in form and substance
satisfactory to the Rating Agencies).
"Approved Operating Expenses": Operating Expenses incurred by Owner or
Borrower following the occurrence of a Cash Management Event or the Anticipated
Repayment Date which (i) are included in the Operating Budget for the Current
Month for the Collateral Property, (ii) are for electric, gas, oil, water, sewer
or other utility service to, or Management Fees for, the Collateral Property, or
(iii) have been approved by Lender, which approval shall not be unreasonably
withheld or delayed.
"Approved Replacement Expenses": Replacement Expenses incurred by Owner or
Borrower which (i) are included in the approved Replacement Budget for the
Current Month for the Collateral Property or (ii) have been approved by Lender,
which approval shall not be unreasonably withheld or delayed.
"Assignment of Leases": shall mean that certain first priority Assignment
of Leases and Rents, dated as of the date hereof, from Owner and Borrower, as
assignor, to Lender, as assignee, assigning to Lender all of the Owner's and
Borrower's interest in and to the Leases and Rents of the Collateral Property as
security for the Loan, as the same may be amended, restated, replaced,
supplemented or otherwise modified from time to time.
"Business Day": means any day other than (i) a Saturday or a Sunday, and
(ii) a day on which federally insured depository institutions in New York, New
York or San Francisco,
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California are authorized or obligated by law, regulation, governmental decree
or executive order to be closed.
"Cash Management Agreement": shall mean that certain Cash Management
Agreement dated as of the date hereof by and between Owner, Borrower, Lender,
Manager and Agent.
"Cash Management Event": either (A) an Event of Default occurs or (B) the
Debt Service Coverage Ratio at any time is less than 1.25, subject to a One Time
Cash Management Event Cure by the Borrower.
"Cash Management Fee": the fees charged from time to time by the Agent in
accordance with the Cash Management Agreement.
"Cash Management Termination": the giving by Lender to the Agent of notice
that the sweeping of funds into the Rollover Reserve Account, Replacement
Reserve Account, Operating Expense Account and the Cash Collateral Account may
cease (a "Cash Management Termination Notice"), which notice Lender shall only
be required to give if (x) no other Cash Management Event has subsequently
occurred, and (y) and the Debt Service Coverage Ratio has been 1.25x or higher
for two consecutive fiscal quarters (such Debt Service Coverage Ratio being
tested on a quarterly basis) since the occurrence of the Cash Management Event.
"Closing Date": shall mean the date of the funding of the Loan.
"Code": the Internal Revenue Code of 1986, as amended, any successor
statutes thereto, and applicable U.S. Department of Treasury regulations issued
pursuant thereto in temporary or final form.
"Collateral Property": shall mean that certain parcel of real property,
the Improvements thereon, the Equipment and all personal property owned by Owner
and encumbered by the Mortgage, together with all rights pertaining to such
property and Improvements, as more particularly described in the granting
clauses of the Mortgage.
"Control": with respect to any Person, either (i) ownership directly or
through other entities of more than fifty percent (50%) of all beneficial equity
interest in such Person, or (ii) the possession, directly or indirectly, of the
power to direct or cause the direction of the management and policies of such
Person, through the ownership of voting securities, by contract or otherwise.
"Current Month": as of any date of determination following the occurrence
of a Cash Management Event or the Anticipated Repayment Date, the then current
calendar month.
"Debt": the unpaid principal, all interest accrued and unpaid thereon, any
Yield Maintenance Premium and all other sums due to Lender in respect of the
Loan under the Note, this Agreement, the Mortgage, or under any Loan Document.
"Debt Service": with respect to any particular period of time, the
scheduled amount of Principal and interest payments due under the Note in such
period.
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"Debt Service Coverage Ratio": as of any date, the ratio calculated by
Lender of (i) the Net Operating Income for the twelve (12) month period ending
with the most recently completed calendar quarter to (ii) the Debt Service for
the same period.
"Default": the occurrence of any event under any Loan Document which, but
for the giving of notice or passage of time, or both, would be an Event of
Default.
"Default Rate": prior to the Stated Maturity Date: a rate per annum equal
to the lesser of (i) the Maximum Rate and (ii) three percent (3%) above the
Applicable Interest Rate, compounded monthly.
"Defeasance Collateral": shall mean obligations or securities not subject
to prepayment, call or early redemption which are direct obligations of, or
obligations fully guaranteed as to timely payment by, the United States of
America or any agency or instrumentality of the United States of America, or the
obligations of which are backed by the full faith and credit of the United
States of America, the ownership of which will not cause Lender to be an
"investment company" under the Investment Company Act of 1940, as amended, as
evidenced by an opinion of counsel reasonably acceptable to Lender, and which
qualify under ss. 1.860G-2(a)(8) of the Treasury regulations. All such
obligations or securities shall mature or be redeemable, or provide for payments
of interest thereon, on or prior to the Business Day preceding the date such
amounts are required to be applied under this Agreement and shall provide
payments (i) on or prior to, but as close as possible to, all Payment Dates and
other scheduled payment dates if any, under the Note after the Defeasance Date
and up to and including the Anticipated Repayment Date, and (ii) in amounts
equal to or greater than the Schedule Defeasance Payments.
"Eligible Account": shall mean a separate and identifiable account from
all other funds held by the holding institution that is either (a) an account or
accounts maintained with a federal or state-chartered depository institution or
trust company which complies with the definition of Eligible Institution or (b)
a segregated trust account or accounts maintained with a federal or state
chartered depository institution or trust company acting in its fiduciary
capacity which, in the case of a state chartered depository institution or trust
company, is subject to regulations substantially similar to 12 C.F.R.
ss.9.10(b), having in either case a combined capital and surplus of at least
$50,000,000 and subject to supervision or examination by federal and state
authority. An Eligible Account will not be evidenced by a certificate of
deposit, passbook or other instrument.
"Eligible Institution" shall mean a federal or state chartered depository
institution or trust company, the long-term unsecured debt obligations of which
are rated at least (A) "A+" by S&P and (B) "A+" by Fitch IBCA, Inc. ("Fitch")
or, if not rated by Fitch, at least "A" or its equivalent by another nationally
recognized statistical rating agency (other than S&P) if the deposits are to be
held in such account 30 days or more or the short-term debt obligations of which
have a short-term rating of not less than "A-1" from S&P and "F-1+" from Fitch
or if not rated by Fitch, at least "F-1+" or its equivalent by another
nationally recognized statistical rating agency (other than S&P) if the deposits
are to be held in such account for less than thirty (30) days, or such other
account or accounts with respect to which the Applicable Rating Agencies shall
have confirmed in writing that the then current ratings assigned in any
Secondary Market Transaction will not be qualified, downgraded or withdrawn by
reason thereof.
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"Environmental Event": means, with respect to the Collateral Property, (a)
a violation of any Environmental Law of which Owner or Borrower has received
written notice from a governmental authority, or (b) the presence of any
Hazardous Substance on, about, or under the Collateral Property that, under or
pursuant to any Environmental Law, would require remediation, if in the case of
either (a) or (b), such event or circumstance could result in a material adverse
effect on the value or operations of the Collateral Property.
"ERISA": the Employment Retirement Income Security Act of 1974, as amended
from time to time, and the rules and regulations promulgated thereunder.
"ERISA Affiliate": all members of a controlled group of corporations and
all trades and business (whether or not incorporated) under common control and
all other entities which, together with Owner and/or Borrower, are treated as a
single employer under any or all of Section 414(b), (c), (m) or (o) of the Code.
"FASIT": Financial Asset Securitization Investment Trust within the
meaning of Section 860L (a)(1) of the Code.
"Fiscal Year": each twelve month period commencing on January 1 and ending
on December 31 during each year of the Term.
"GAAP": generally accepted accounting principles in the United States of
America as of the date of the applicable financial report.
"Governmental Authority": any court, board, agency, commission, office or
authority of any nature whatsoever for any governmental ▇▇▇▇ (▇▇▇▇▇▇▇, ▇▇▇▇▇,
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇ or otherwise) now or hereafter in existence.
"Guaranty": shall mean that certain Indemnity Payment Guaranty of even
date herewith from Owner to Lender.
"Improvements": shall have the meaning set forth in the granting clause of
the Mortgage with respect to the Collateral Property.
"Independent Director": shall mean a director or manager of the SPE Member
who is not at the time of initial appointment, or at any time while serving as a
director of the SPE Member, and has not been at any time during the preceding
five (5) years: (a) a stockbroker, director (with the exception of serving as
the Independent Director of the SPE Member), officer, employee, partner,
attorney or counsel of the SPE Member, the Owner, Borrower or any Affiliate of
any of them; (b) a customer, supplier or other person who derives any of its
purchases or revenues from its activities with the SPE Member, the Owner,
Borrower or any Affiliate of any of them; (c) a Person controlling or under
common control with any such stockholder, partner, customer, supplier or other
Person; or (d) a member of the immediate family of any such stockholder,
director, officer, employee, partner, customer, supplier or other person. As
used in this definition, the term "control" means the possession, directly or
indirectly, of the power to direct or cause the direction of management,
policies or activities of a Person, whether through ownership of voting
securities, by contract or otherwise. An individual that otherwise satisfies the
foregoing shall not be disqualified from serving as an Independent Director of
the SPE
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Member if such individual is at the time of initial appointment, or at any time
while serving as an Independent Director of the SPE Member, an Independent
Director of a Special Purpose Entity Affiliated with the Owner, Borrower or the
SPE Member.
"Insolvency Opinion": shall mean one or more substantive non-consolidation
opinion letters, dated the date hereof, delivered by Debevoise & ▇▇▇▇▇▇▇▇ on
behalf of Owner and Borrower in connection with the Loan.
"Interest Period": (i) the period from the Closing Date through the first
day thereafter that is an Interest Period Termination Date and (ii) each period
thereafter from an Interest Period Commencement Date through an Interest Period
Termination Date; except that the Interest Period, if any, that would otherwise
commence before and end after the Maturity Date shall end on the Maturity Date.
"Interest Period Commencement Date": the eleventh (11th) day of each
calendar month; provided, however, that if the Payment Date is changed by Lender
pursuant to the definition thereof, Lender may adjust this definition
accordingly.
"Interest Period Termination Date": the tenth (10th) day of each calendar
month (notwithstanding that the succeeding Payment Date may not be an Interest
Period Commencement Date because the day after such Interest Period Termination
Date is not a Business Day); provided, however, that if the Payment Date is
changed by Lender pursuant to the definition thereof, Lender may adjust this
definition accordingly.
"Lease Rollover Number": as to any calendar year, the aggregate number of
square feet of gross leaseable area in the Improvements that are covered by
Leases the expiration dates of which (after taking into account all renewals and
extensions that have been unconditionally exercised as of the date in question)
are scheduled to occur in such calendar year.
"Lease Rollover Percentage": as to any calendar year, a fraction,
expressed as a percentage, the numerator of which is the Lease Rollover Number
for such calendar year and the denominator of which is the aggregate number of
square feet of gross leaseable area of the Improvements.
"Leases": all leases and other agreements existing on the date hereof or
hereafter entered into affecting the use, or occupancy of, or the conduct of any
activity upon or in, the Collateral Property or any Improvements thereon,
including any extensions, renewals, modifications or amendments thereof, but
excluding (i) reciprocal easement and operating agreements, and (ii) subleases
where the sublessee is not in privity with Owner.
"Legal Requirements": statutes, laws, rules, orders, regulations,
ordinances, judgments, decrees and injunctions of, or agreements with,
Governmental Authorities affecting all or part of the Collateral Property or the
construction, use, alteration or operation thereof, whether now or hereafter
enacted and in force, and all permits, licenses and authorizations and
regulations relating thereto, and all covenants, agreements, restrictions and
encumbrances contained in any instrument, either of record or known to Owner or
Borrower, at any time in force affecting all or part of the Collateral Property,
including any that may (i) require repairs, modifications or
-6-
alterations in or to all or part of the Collateral Property, or (ii) in any way
limit the use and enjoyment thereof.
"Letter of Credit": shall mean an irrevocable, unconditional,
transferable, clean sight draft letter of credit in favor of Lender and
entitling Lender to draw thereon in New York, New York, issued by a domestic
Eligible Institution or the U.S. agency or branch of a foreign Eligible
Institution, or if there are no domestic banks or financial institutions which
qualify as an Eligible Institution or U.S. agencies or branches of a foreign
bank or financial institution which qualifies as an Eligible Institution then
issuing letters of credit, then such letter of credit may be issued by any
domestic bank with a long term unsecured debt rating that is the highest such
rating then given by each Rating Agency to a domestic commercial bank.
"Letter of Credit Agreement": shall mean that certain Letter of Credit
Agreement, dated as of the date hereof, by and between Owner, Borrower and
Lender, pursuant to which Owner and Borrower have caused to be delivered to
Lender the UBS Letter of Credit as additional collateral for Borrower's
performance of its Obligations hereunder.
"Lien": any mortgage, deed of trust, indemnity deed of trust, lien,
pledge, hypothecation, assignment, security interest or any other encumbrance,
charge or transfer of, on or affecting all or part of the Collateral Property or
any interest therein, or in an Owner or in any Owner Representative, 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.
"Loan": shall mean the loan made by Lender to Borrower pursuant to this
Agreement.
"Loan Documents": this Agreement and all other documents, agreements and
instruments evidencing, securing or delivered to Lender in connection with the
Loan, whether now existing or hereafter executed, including the following: (i)
the Note, (ii) the indemnity deed of trust on the Collateral Property (the
"Mortgage"), (iii) the Assignment of Leases with respect to the Collateral
Property, (iv) the Guaranty, (v) the Letter of Credit Agreement, (vi) the
Assignment of Agreements with respect to the Collateral Property, (vii) the
Manager's Consent and Subordination of Management Agreement with respect to the
Collateral Property, and (viii) the Cash Management Agreement, and all other
documents executed and/or delivered in connection with the Loan, as each of the
foregoing may be (and each of the foregoing defined terms shall refer to such
documents as they may be) amended, restated, replaced, supplemented or otherwise
modified from time to time.
"Maintenance and Repairs": items of maintenance and repair to the
Improvements or Equipment similar to the items of work (but not limited to such
specific items) described in the physical inspection report delivered to Lender
in connection with the closing of the Loan.
"Management Agreement": the management agreement in effect on the date
hereof between Owner and the Approved Manager, pursuant to which the Approved
Manager is to manage the Collateral Property, as same may be amended, restated,
replaced, supplemented or otherwise modified from time to time with the prior
approval of Lender (which consent shall not
-7-
be reasonably withheld or delayed), and after any Secondary Market Transaction,
the approval of each Rating Agency (provided, however, that any modification
which does not modify the term or economics of the Management Agreement or
otherwise materially modify the Management Agreement, shall require prior notice
to, but not the consent of, Lender, and shall not require the consent of any
Rating Agency).
"Management Fee(s)": as to any Management Agreement, all fees in the
nature of management fees payable to Manager under such Management Agreement.
"Manager": the Approved Manager under the Management Agreement for the
Collateral Property.
"Material Alteration": any alteration (other than the New Construction)
affecting structural elements of the Collateral Property, the cost of which
exceeds five percent (5%) of the Loan amount per calendar year; provided,
however, that in no event shall tenant improvement work, or alterations
performed as part of a Restoration, constitute a Material Alteration.
"Material Lease": any Lease (i) which demises more than five percent (5%)
of the Collateral Property's gross leaseable area or (ii) the fixed annual rent
under which exceeds five percent (5%) of the aggregate fixed annual rent payable
under all Leases of the Collateral Property.
"Matured Performing Rate": shall mean a rate per annum equal to the
Regular Interest Rate plus four hundred (400) basis points.
"Maturity Date": the date on which the final payment of Principal of the
Note becomes due and payable as therein or herein provided, whether at the
Stated Maturity Date, by declaration of acceleration, or otherwise.
"Maximum Rate": the maximum interest rate allowed by applicable law in
effect with respect to the Loan on the date for which a determination of
interest accrued hereunder is made, after taking into account all fees, payments
and other charges that are, under applicable law, characterized as interest.
"Monthly Debt Service Payment Amount": shall mean a constant monthly
payment of $ 1,077,278.12.
"Monthly Replacement Deposit": the amount reasonably determined by Lender,
based on the property condition report for the Collateral Property reviewed by
Lender, in connection with Lender's making of the Loan. On each anniversary of
the date of this Agreement (or, if any such anniversary is not a Payment Date,
on the first Payment Date following such anniversary) the Monthly Replacement
Deposit shall automatically increase by 2.5% of the then current Monthly
Replacement Deposit amount. The initial Monthly Replacement Deposit for the
Collateral Property is set forth in Schedule 1 hereto.
"Monthly Rollover Deposit": an amount equal to one-twelfth (1/12th) of the
average annual cost (as determined by Lender) to Owner for tenant improvements
and leasing
-8-
commissions in respect of the Collateral Property during the sixty (60) month
period prior to the Closing Date, as set forth on Schedule 2 hereto.
"Net Operating Income": for any period, the excess, if any, of Operating
Income for such period over Operating Expenses for such period.
"Net Operating Income After Debt Service": for any period shall mean the
amount obtained by subtracting Debt Service for such period from Net Operating
Income for such period.
"New Construction": shall mean the expansion of the Collateral Property to
add an additional 70,000 square feet of gross leasable area, all as is more
specifically provided for in the Letter of Credit Agreement.
"Obligations": all obligations, liabilities and Debt of Owner and Borrower
to Lender, whether now existing or hereafter arising, under this Agreement or
any of the other Loan Documents.
"Officer's Certificate": a certificate delivered to Lender by Owner or
Borrower, as applicable, which is signed by a senior executive officer of
Owner's Owner Representative or Borrower's Borrower Representative.
"One Time Cash Management Event Cure": In the event that a Cash Management
Event is due to the Debt Service Coverage Ratio being below 1.25, the Borrower
shall have the opportunity one (1) time during the Loan term to deposit cash or
a Letter of Credit with the Lender in an amount sufficient to raise the Debt
Service Coverage Ratio to 1.30; provided, however, that the Debt Service
Coverage Ratio must be 1.25 or greater at the end of the immediately following
quarter.
"Operating Expenses": shall mean the total of all expenditures, computed
in accordance with GAAP, of whatever kind relating to the operation, maintenance
and management of the Collateral Property that are incurred on a regular monthly
or other periodic basis, including without limitation, utilities, ordinary
repairs and maintenance, insurance, license fees, property taxes and
assessments, advertising expenses, management fees, payroll and related taxes,
computer processing charges, operational equipment or other lease payments, and
other similar costs, but excluding depreciation, Debt Service, Replacement
Expenses, non-cash items such as depreciation and amortization or any
extraordinary one time expenditures not considered operating expenses under
GAAP.
"Operating Income": for any period, all regular on-going revenues actually
received by Owner from the operation of the Collateral Property during such
period, including (i) Rents, (ii) amounts withdrawn from any Funds pursuant to
this Agreement, and (iii) all other amounts actually received which in
accordance with GAAP are required to be or are included in Owner's annual
financial statements as operating income of the Collateral Property; provided,
that Operating Income will not include (1) income from non-recurring income
sources; (2) advance Rents or other payments; (3) deposits or escrows other than
the Funds, without duplication; (4) any income otherwise includable in Operating
Income but paid to a Person other than Owner
-9-
or Borrower; (5) proceeds of Casualty insurance or Condemnation Awards; or (6)
income from a sale, financing or other capital transaction.
"Other Charges": all managing member, maintenance charges, impositions
other than Taxes, and any other charges, including vault charges and license
fees for the use of vaults, chutes and similar areas adjoining the Collateral
Property, now or hereafter levied or assessed or imposed against the Collateral
Property or any part thereof, including all interest and penalties on any of the
foregoing.
"Owner Representative". Each Owner's general partner or managing member.
"Payment Date": the eleventh (11th) day of each calendar month (or such
other day of a calendar month selected by Lender to collect debt service
payments under loans which it makes and securitizes) or, if such day is not a
Business Day, the first Business Day thereafter.
"Permitted Encumbrances": (a) the Liens created by the Loan Documents, (b)
all Liens and other matters disclosed in the Title Insurance Policies insuring
the Mortgage on the Collateral Property, (c) Liens, if any, for Taxes or Other
Charges not yet payable or delinquent, (d) easements for utilities and rights of
way which do not have a material adverse affect on the use, operation or value
of such Collateral Property and (e) such other title and survey exceptions as
Lender approves in writing in Lender's reasonable discretion.
"Permitted Investments": shall mean any one or more of the following
obligations or securities acquired at a purchase price of not greater than par,
including those issued by Servicer, the trustee under any Secondary Market
Transaction or any of their respective Affiliates, payable on demand or having a
maturity date not later than the Business Day immediately prior to the first
Payment Date following the date of acquiring such investment and meeting one of
the appropriate standards set forth below:
(1) obligations of, or obligations fully guaranteed as to payment of
principal and interest by, the United States or any agency or instrumentality
thereof provided such obligations are backed by the full faith and credit of the
United States of America including, without limitation, obligations of: the U.S.
Treasury (all direct or fully guaranteed obligations), the Farmers Home
Administration (certificates of beneficial ownership), the General Services
Administration (participation certificates), the U.S. Maritime Administration
(guaranteed Title XI financing), the Small Business Administration (guaranteed
participation certificates and guaranteed pool certificates), the U.S.
Department of Housing and Urban Development (local authority bonds) and the
Washington Metropolitan Area Transit Authority (guaranteed transit bonds);
provided, however, that the investments described in this clause must (A) have a
predetermined fixed dollar of principal due at maturity that cannot vary or
change, (B) if rated by S&P, must not have an "r" highlighter affixed to their
rating, (C) if such investments have a variable rate of interest, such interest
rate must be tied to a single interest rate index plus a fixed spread (if any)
and must move proportionately with that index, and (D) such investments must not
be subject to liquidation prior to their maturity;
(2) Federal Housing Administration debentures;
-10-
(3) obligations of the following United States government sponsored
agencies: Federal Home Loan Mortgage Corp. (debt obligations), the Farm Credit
System (consolidated systemwide bonds and notes), the Federal Home Loan Banks
(consolidated debt obligations), the Federal National Mortgage Association (debt
obligations), the Student Loan Marketing Association (debt obligations), the
Financing Corp. (debt obligations), and the Resolution Funding Corp. (debt
obligations); provided, however, that the investments described in this clause
must (A) have a predetermined fixed dollar of principal due at maturity that
cannot vary or change, (B) if rated by S&P, must not have an "r" highlighter
affixed to their rating, (C) if such investments have a variable rate of
interest, such interest rate must be tied to a single interest rate index plus a
fixed spread (if any) and must move proportionately with that index, and (D)
such investments must not be subject to liquidation prior to their maturity;
(4) federal funds, unsecured certificates of deposit, time deposits,
the short term obligations of which at all times are rated in the highest short
term rating category by each Applicable Rating Agency (or, if not rated by all
Rating Agencies, rated by at least one Rating Agency in the highest short term
rating category and otherwise acceptable to each other Rating Agency, as
confirmed in writing that such investment would not, in and of itself, result in
a downgrade, qualification or withdrawal of the initial, or, if higher, then
current ratings assigned to the Securities); provided, however, that the
investments described in this clause must (A) have a predetermined fixed dollar
of principal due at maturity that cannot vary or change, (B) if rated by S&P,
must not have an "r" highlighter affixed to their rating, (C) if such
investments have a variable rate of interest, such interest rate must be tied to
a single interest rate index plus a fixed spread (if any) and must move
proportionately with that index, and (D) such investments must not be subject to
liquidation prior to their maturity;
(5) fully Federal Deposit Insurance Corporation-insured demand and
time deposits in, or certificates of deposit of any bank or trust company,
savings and loan association or savings bank, the short term obligations of
which at all times are rated in the highest short term rating category by each
Rating Agency (or, if not rated by all Rating Agencies, rated by at least one
Rating Agency in the highest short term rating category and otherwise acceptable
to each other Rating Agency, as confirmed in writing that such investment would
not, in and of itself, result in a downgrade, qualification or withdrawal of the
initial, or, if higher, then current ratings assigned to the Securities);
provided, however, that the investments described in this clause must (A) have a
predetermined fixed dollar of principal due at maturity that cannot vary or
change, (B) if rated by S&P, must not have an "r" highlighter affixed to their
rating, (C) if such investments have a variable rate of interest, such interest
rate must be tied to a single interest rate index plus a fixed spread (if any)
and must move proportionately with that index, and (D) such investments must not
be subject to liquidation prior to their maturity;
(6) debt obligations with maturities of not more than 365 days and
at all times rated by each Rating Agency (or, if not rated by all Rating
Agencies, rated by at least one Rating Agency and otherwise acceptable to each
other Rating Agency, as confirmed in writing that such investment would not, in
and of itself, result in a downgrade, qualification or withdrawal of the
initial, or, if higher, then current ratings assigned to the Securities) in its
highest long-term unsecured rating category; provided, however, that the
investments described in this clause must (A) have a predetermined fixed dollar
of principal due at maturity that cannot vary or change, (B) if rated by S&P,
must not have an "r" highlighter affixed to their rating,
-11-
(C) if such investments have a variable rate of interest, such interest rate
must be tied to a single interest rate index plus a fixed spread (if any) and
must move proportionately with that index, and (D) such investments must not be
subject to liquidation prior to their maturity;
(7) commercial paper (including both non-interest-bearing discount
obligations and interest-bearing obligations payable on demand or on a specified
date not more than one year after the date of issuance thereof) with maturities
of not more than 365 days and that at all times is rated by each Rating Agency
(or, if not rated by all Rating Agencies, rated by at least one Rating Agency
and otherwise acceptable to each other Rating Agency, as confirmed in writing
that such investment would not, in and of itself, result in a downgrade,
qualification or withdrawal of the initial, or, if higher, then current ratings
assigned to the Securities) in its highest short-term unsecured debt rating;
provided, however, that the investments described in this clause must (A) have a
predetermined fixed dollar of principal due at maturity that cannot vary or
change, (B) if rated by S&P, must not have an "r" highlighter affixed to their
rating, (C) if such investments have a variable rate of interest, such interest
rate must be tied to a single interest rate index plus a fixed spread (if any)
and must move proportionately with that index, and (D) such investments must not
be subject to liquidation prior to their maturity;
(8) units of taxable money market funds or mutual funds, which funds
are regulated investment companies, seek to maintain a constant net asset value
per share and invest solely in obligations backed by the full faith and credit
of the United States, which funds have the highest rating available from each
Rating Agency (or, if not rated by all Rating Agencies, rated by at least one
Rating Agency and otherwise acceptable to each other Rating Agency, as confirmed
in writing that such investment would not, in and of itself, result in a
downgrade, qualification or withdrawal of the initial, or, if higher, then
current ratings assigned to the Securities) for money market funds or mutual
funds; and
(9) any other security, obligation or investment which has been
approved as a Permitted Investment in writing by (a) Lender and (b) each Rating
Agency, as evidenced by a written confirmation that the designation of such
security, obligation or investment as a Permitted Investment will not, in and of
itself, result in a downgrade, qualification or withdrawal of the initial, or,
if higher, then current ratings assigned to the Securities by such Rating
Agency;
provided, however, that no obligation or security shall be a Permitted
Investment if (A) such obligation or security evidences a right to receive only
interest payments or (B) the right to receive principal and interest payments on
such obligation or security are derived from an underlying investment that
provides a yield to maturity in excess of 120% of the yield to maturity at par
of such underlying investment.
"Person": any individual, corporation, partnership, joint venture, estate,
trust, unincorporated association, 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.
"Plan": (i) an employee benefit or other plan established or maintained by
Borrower or any ERISA Affiliate or to which Borrower or any ERISA Affiliate
makes or is obligated to make
-12-
contributions and (ii) which is covered by Title IV of ERISA or Section 302 of
ERISA or Section 412 of the Code.
"Pooling and Servicing Agreement": the Servicing Agreement entered into
with the Servicer in connection with any Secondary Market Transaction, as the
same may be amended, restated, replaced, supplemented or otherwise modified from
time to time.
"Prepayment Lockout Expiration Date": shall mean the date that is the
later of (a) three (3) years from the Closing Date or (b) two (2) years from the
"startup day" within the meaning of Section 860G(a)(9) of the Code of the REMIC
Trust.
"Qualified REA": an REA all of the terms and conditions of which are
acceptable to Lender in its sole and absolute discretion and as to which each of
the parties to the REA (other than Owner) has executed and delivered to Lender
an estoppel certificate in form, scope and substance satisfactory to Lender in
its sole and absolute discretion.
"Rating Agency": any of Standard & Poor's Ratings Group, a division of
▇▇▇▇▇▇-▇▇▇▇, Inc. ("S&P"), ▇▇▇▇▇'▇ Investors Service, Inc., Duff & ▇▇▇▇▇▇ Credit
Rating Co., Fitch IBCA, Inc. or any other nationally-recognized statistical
rating agency which has issued a rating of any Securities.
"Rating Comfort Letter": a letter issued by each of the Applicable Rating
Agencies which confirms that the taking of the action referenced to therein will
not result in any qualification, withdrawal or downgrading of any existing
ratings of Securities created in a Secondary Market Transaction.
"REA": any "construction, operation and reciprocal easement agreement" or
similar agreement (including any "separate agreement" or other agreement between
Owner and one or more other parties to an REA with respect to an REA) affecting
the Collateral Property or any portion thereof.
"Real Property": as to the Collateral Property, the portions thereof
constituting land, Improvements thereon and all rights pertaining to such land
and Improvements.
"Regular Interest Rate": shall mean 8.177% per annum.
"REMIC": a "real estate mortgage investment conduit" within the meaning of
Section 860D of the Code that holds the Note.
"Rents": all rents, rent equivalents, moneys payable as damages or in lieu
of rent or rent equivalents, royalties (including, all oil and gas or other
mineral royalties and bonuses), income, fees, receivables, receipts, revenues,
deposits (including security, utility and other deposits), accounts, cash,
issues, profits, charges for services rendered, and other payment and
consideration of whatever form or nature received by or paid to or for the
account of or benefit of Owner, Manager (in its capacity as manager of the
Collateral Property, and excluding sums payable by Borrower to Manager pursuant
to the Management Agreement) or any of their agents or employees from any and
all sources arising from or attributable to the Collateral Property and the
Improvements thereon, including all receivables, customer obligations,
installment payment
-13-
obligations and other obligations now existing or hereafter arising or created
out of the sale, lease, sublease, license, concession or other grant of the
right of the use and occupancy of the Collateral Property or rendering of
services by Owner or Manager (in its capacity as manager of the Collateral
Property, and excluding sums payable by Borrower to Manager pursuant to the
Management Agreement), and proceeds, if any, from business interruption or other
loss of income insurance.
"Replacement Expenses": expenses incurred to pay for replacements,
improvements and/or Maintenance and Repairs of the Improvements or Equipment or
portions of either.
"Required Record": any financial statement, certificate, report or
information required to be delivered under Section 6.9.
"Routine Hazardous Substances": Hazardous Substances typically used in the
ordinary course of business at retail properties, which are generated, used,
stored and disposed of in compliance with all applicable Environmental Laws.
"Scheduled Defeasance Payments": shall mean scheduled payments of interest
and principal under the Note in the case of a Defeasance for all Payment Dates
occurring after the Defeasance Date and up to and including the Anticipated
Repayment Date (including, the outstanding Principal balance on the Note as of
the Anticipated Repayment Date), and all payments required after the Defeasance
Date, if any, under the Loan Documents for servicing fees, fees to Agent and
other similar charges.
"Security Agreement": shall mean a security agreement in form and
substance satisfactory to Lender pursuant to which Borrower grants Lender a
perfected, first priority security interest in the Defeasance Collateral Account
and the Defeasance Collateral.
"Servicer": Bank of New York, or its successor in interest, or if any
successor servicer is appointed pursuant to the Pooling and Servicing Agreement,
such successor servicer.
"SPE Member": shall have the meaning set forth in subparagraph (5) of the
definition of "Special Purpose Entity" contained in this Section 1.1.
"Special Purpose Entity": shall mean a corporation, limited partnership or
limited liability company which at all times on and after the date hereof:
(1) is organized solely for the purpose of (A) acquiring,
developing, owning, holding, selling, leasing, transferring, exchanging,
managing and operating the Collateral Property, entering into this Agreement
with the Lender, refinancing the Collateral Property in connection with a
permitted repayment of the Loan, and transacting lawful business that is
incident, necessary and appropriate to accomplish the foregoing; (B) acting as a
general partner of the limited partnership that owns the Collateral Property or
member of the limited liability company that owns the Collateral Property; (C)
acting as a Borrower under this Agreement; (D) guaranteeing the obligations
under this Agreement and securing its obligations under such guarantee with the
Collateral Property and/or; (E) acting as the sole managing member or sole
managing partner of the Borrower or any entity which owns a partnership
-14-
interest or a membership interest in (i) the Borrower or Owner or (ii) any
parent of the Borrower or Owner.
(2) is not engaged and will not engage in any business unrelated to
the purposes described in paragraph (1) above;
(3) does not have and will not have any assets other than those
related to the Collateral Property and other than for the purposes described in
paragraph (1) above;
(4) has not engaged, sought or consented to and will not engage in,
seek or consent to any dissolution, winding up, liquidation, consolidation,
merger, sale of all or substantially all of its assets, transfer of partnership
or membership interests (if such entity is a general partner in a limited
partnership or a member in a limited liability company) or amendment of its
limited partnership agreement, articles of incorporation, articles of
organization, certificate of formation or operating agreement (as applicable)
with respect to the matters set forth in this definition;
(5) if such entity is a limited partnership, has, as its only
general partners, Special Purpose Entities that are corporations, limited
partnerships or limited liability companies (with more than one member)
(together with the members required pursuant to subparagraph (7) below (if
applicable), the "SPE Member");
(6) if such entity is a corporation, has at least two (2)
Independent Directors, and has not caused or allowed and will not cause or allow
the board of directors or managers of such entity to take any action requiring
the unanimous affirmative vote of 100% of the members of its board of directors
or managers unless all Independent Directors shall have participated in such
vote;
(7) (a) if such entity is a limited liability company, has at least
one member that is a Special Purpose Entity that has at least two (2)
Independent Directors and that owns at least one percent (1%) of the equity of
the limited liability company or (b) is wholly-owned by ▇▇▇▇ or Owner;
(8) if such entity is (a) a limited liability company, has articles
of organization, a certificate of formation and/or an operating agreement, as
applicable, (b) a limited partnership, has a limited partnership agreement, or
(c) a corporation, has a certificate of incorporation or articles that, in each
case, provide that such entity will not: (1) dissolve, merge, liquidate,
consolidate; (2) sell all or substantially all of its assets or the assets of
the Owner or Borrower (as applicable); (3) engage in any other business
activity, or amend its organizational documents with respect to the matters set
forth in this definition without the consent of the Lender; or (4) without the
affirmative vote of all Independent Directors and of all other directors or
managers of the corporation or entity (that is such entity or the general
partner or managing or co-managing member of such entity), file a bankruptcy or
insolvency petition or otherwise institute insolvency proceedings with respect
to itself or to any other entity in which it has a direct or indirect legal or
beneficial ownership interest;
(9) if such entity is a limited partnership or a limited liability
company that is the general partner of a limited partnership or the member of a
limited liability company
-15-
that is the Owner or Borrower, has an entity that owns at least one percent (1%)
of the equity of such entity as its general partner or managing member, as
applicable, that is a Special Purpose Entity;
(10) is and will remain solvent and pay its debts and liabilities
(including, as applicable, shared personnel and overhead expenses) from its
assets as the same shall become due, and is maintaining and will maintain
adequate capital for the normal obligations reasonably foreseeable in a business
of its size and character and in light of its contemplated business operations;
(11) has not failed and will not fail to correct any known
misunderstanding regarding the separate identity of such entity;
(12) maintains and will maintain its accounts, books and records
separate from any other Person and will file its own tax returns, except to the
extent that it is required to file consolidated tax returns by law;
(13) maintains and will maintain its own records, books, resolutions
and agreements;
(14) other than as provided in the Cash Management Agreement, (a)
does not and will not commingle its funds or assets with those of any other
Person and (b) does not participate and will not participate in any cash
management system with any other Person;
(15) has held and will hold its assets in its own name;
(16) has conducted and will conduct its business in its name or in a
name franchised or licensed to it by an entity, except for services rendered
under a business management services agreement with an Affiliate that complies
with the terms contained in Section 7.14 of this Agreement, so long as the
manager, or equivalent thereof, under such business management services
agreement holds itself out as an agent of the Owner;
(17) maintains and will maintain its financial statements,
accounting records and other entity documents separate from any other Person and
has not permitted and will not permit its assets to be listed as assets on the
financial statement of any other entity except as required by GAAP;
(18) pays and will pay its own liabilities and expenses, including
the salaries of its own employees, out of its own funds and assets, and has
maintained and will maintain a sufficient number of employees in light of its
contemplated business operations;
(19) has observed and will observe all partnership, corporate or
limited liability company formalities, as applicable;
(20) will not create, incur or assume any indebtedness other than
(i) the Debt, (ii) Taxes, Insurance Premiums, Approved Replacement Expenses and
Approved Leasing Expenses and (iii) other trade debt incurred in the ordinary
course of business relating to the ownership and operation of its Collateral
Property which other trade debt does not exceed, at any
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time, a maximum aggregate amount of $1,000,000.00 for the Collateral Property,
and such trade debt is paid within sixty (60) days of the date incurred (other
than amounts being disputed in good faith);
(21) does not and will not assume or guarantee or become obligated
for the debts of any other Person or hold out its credit as being available to
satisfy the obligations of any other Person except as permitted pursuant to this
Agreement;
(22) does not and will not acquire obligations or securities of its
partners, members or shareholders or any other Affiliate except as permitted
pursuant to this Agreement;
(23) allocates and will allocate fairly and reasonably any overhead
expenses that are shared with any Affiliate, including, but not limited to,
paying for shared office space and services performed by any employee of an
affiliate;
(24) the stationary, invoices, and checks utilized by the Special
Purpose Entity or utilized to collect its funds or pay its expenses shall bear
its own name and shall not bear the name of any other entity unless such entity
is clearly designated as being the Special Purpose Entity's Manager.
(25) will not pledge its assets for the benefit of any other Person
except as otherwise permitted in the Loan Agreement or the Pledge and Security
Agreement;
(26) will hold itself out and identify itself as a separate and
distinct entity under its own name or in a name franchised or licensed to it by
an entity and not as a division or part of any other Person, except for services
rendered under a business management services agreement with an Affiliate that
complies with the terms contained in Section 7.14 herein, so long as the
manager, or equivalent thereof, under such business management services
agreement holds itself out as an agent of the Owner;
(27) will maintain its assets in such a manner that it will not be
costly or difficult to segregate, ascertain or identify its individual assets
from those of any other Person;
(28) will not make loans to any Person or hold evidence of
indebtedness issued by any other person or entity (other than cash and
investment-grade securities issued by an entity that is not an Affiliate of or
subject to common ownership with such entity) except as permitted pursuant to
this Agreement;
(29) will not identify its partners, members or shareholders, or any
Affiliate of any of them, as a division or part of it, and has not identified
itself and shall not identify itself as a division of any other Person;
(30) has not entered into or been a party to, and will not enter
into or be a party to, any transaction with its partners, members, shareholders
or Affiliates except (A) those referred to in Section 7.14 of this Agreement,
(B) in the ordinary course of its business and on terms which are intrinsically
fair, commercially reasonable and are no less favorable to it than
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would be obtained in a comparable arm's-length transaction with an unrelated
third party and (C) in connection with this Agreement;
(31) will not have any obligation to, and will not, indemnify its
partners, officers, directors or members, as the case may be, or has such an
obligation that is fully subordinated to the Debt and will not constitute a
claim against it in the event that cash flow in excess of the amount required to
pay the Debt is insufficient to pay such obligation;
(32) if such entity is a corporation, it shall consider the
interests of its creditors in connection with all corporate actions referred to
in clause 8(c)(4) of this definition;
(33) will not have any of its obligations guaranteed by any
Affiliate other than those obligations guaranteed in connection with the Loan
except as otherwise permitted pursuant to this Agreement or in connection with
obligations relating to the New Construction and other permitted alterations or
additions to the Collateral Property; and
(34) has complied and will comply with all of the terms and
provisions contained in its organizational documents.
"State": the state or commonwealth in which the Collateral Property or any
part thereof is located.
"Stated Maturity Date": December 11, 2029.
"Survey": a current as-built survey of the Collateral Property prepared by
a surveyor licensed by the State in which the Collateral Property is located and
certified to Lender and the Title Company and prepared in accordance with the
Minimum Standard Detail Requirements for ALTA/ACSM Land Title Surveys meeting
the Accuracy Standards of an Urban Survey, with accuracy and precision
requirements modified to meet current angular and linear tolerance requirements
of the State, showing the legal description and street address of the Collateral
Property; all visible or recorded easements, building lines, curb cuts, and
party walls; all parking, sewage, water, electricity, gas and other utility
facilities, together with recording information concerning the documents
creating any such easements and building lines; stating the net, after deduction
of land dedicated or used or subject to easements for roads, highways, fire
lanes, utilities, storm drains or any other public purpose, and gross area of
the land; and including the following Table A items: 1, 2, 3, 4, 6, 7(a),
7(b)(1), 8, 10, 11 and 13.
"Taxes": all real estate and personal property taxes, assessments, water
rates or sewer rents, now or hereafter levied or assessed or imposed against all
or any part of the Collateral Property.
"Tenant": shall mean any Person leasing, subleasing or otherwise occupying
any portion of the Collateral Property under a Lease or other occupancy
agreement with Owner.
"Term": the entire term of this Agreement, which shall expire upon
repayment in full of the Debt and full performance of each and every obligation
to be performed by Owner or Borrower pursuant to the Loan Documents.
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"Title Company": collectively, Chicago Title Insurance Company and First
American Title Insurance Company of New York together with any other title
company providing re-insurance in connection with Lender's Title Insurance
Policy, and their respective successors.
"Title Insurance Policy": a policy of title insurance, in form and amount
acceptable to Lender, issued by the Title Company for the benefit of Lender, its
successors and assigns, insuring the Lien of the Mortgage on the Collateral
Property subject to no Liens other than Liens acceptable to Lender, and
containing such endorsements and affirmative coverages (including affirmative
coverage as to "creditors' rights" and "tie-in" or "aggregation" coverage) as
Lender may require.
"Transfer": any sale, conveyance, transfer, lease (including any
amendment, extension, modification, waiver or renewal thereof), assignment,
mortgage, pledge, grant of a security interest or hypothecation, whether by law
or otherwise, of or in (i) all or part of the Collateral Property (including any
legal or beneficial direct or indirect interest therein), (ii) any direct or
indirect interest in Owner or Borrower, or (iii) any direct or indirect interest
in the Owner Representative of Owner or the Borrower Representative of Borrower.
"UBS": shall mean UBS AG, Stamford Branch.
"UBS Letter of Credit": shall mean that certain irrevocable letter of
credit issued by UBS for the benefit of Lender in the original principal amount
of $15,000,000.00. The UBS Letter of Credit shall serve as additional collateral
for the performance by Borrower of its Obligations hereunder and under the other
Loan Documents and Borrower's and Lender's rights with respect thereto are
governed by the terms and provisions of the Letter of Credit Agreement.
"UCC": the Uniform Commercial Code as in effect in the State in which the
Collateral Property is located.
"Yield Maintenance Premium": shall mean an amount equal to the present
value as of the Prepayment Date of the Calculated Payments from the Prepayment
Date through the Anticipated Repayment Date determined by discounting such
payments at the Discount Rate. As used in this definition, the term "Prepayment
Date" shall mean the date on which a prepayment is made. As used in this
definition, the term "Calculated Payments" shall mean the monthly payments of
interest only which would be due based on the principal amount of the Loan being
prepaid on the Prepayment Date and assuming an interest rate per annum equal to
the difference (if such difference is greater than zero) between (y) the Regular
Interest Rate and (z) the Yield Maintenance Treasury Rate. As used in this
definition, the term "Discount Rate" shall mean the rate which, when compounded
monthly is equivalent to the Yield Maintenance Treasury Rate, when compounded
semi-annually. As used in this definition, the term "Yield Maintenance Treasury
Rate" shall mean the yield calculated by the linear interpolation of the yields,
as reported in the Federal Reserve Statistical Release H.15-Selected Interest
Rates under the heading U.S. Government Securities/Treasury Constant Maturities
for the week ending prior to the Prepayment Date, of U.S. Treasury Constant
Maturities with maturity dates (one longer or one shorter) most nearly
approximating the Anticipated Repayment Maturity Date. In the event Release H.15
is no longer published, Lender shall select a comparable publication to
determine
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the Yield Maintenance Treasury Rate. In no event, however, shall Lender be
required to reinvest any prepayment proceeds in U.S. Treasury obligations or
otherwise.
1.2 Index of Other Definitions. The following terms are defined in the
sections or Loan Documents indicated below:
"Account(s)" - 4.1.3
"Accrued Interest" - 3.1.3
"Additional Insolvency Opinion" - 5.1.39
"Annual Budget" - 6.9.5
"Applicable Taxes" - 3.5
"Approved Insurer" - 8.1.2
"Award" - 8.3.2
"Bankruptcy Proceeding" - 5.1.8
"Cash Collateral Account" - 4.1.3
"Cash Management Account" - 4.1.2
"Cash Management Accounts" - 4.10.1
"Casualty" - 8.2.1
"Casualty/Condemnation Prepayment" - 3.2.2
"Casualty/Condemnation Fund" - 4.8
"Closing Estoppels" - 6.21
"Condemnation" - 8.3.1
"Construction Cash Collateral Agreement" - 6.3.4
"Construction Interest Reserve Account" - 4.1.3
"Construction Interest Reserve Fund" - 4.6.1
"Debt Service Reserve Account" - 4.1.3
"Defeasance Collateral Account" - 2.4.3
"Defeasance Date" - 2.4.1
"Disclosure Document" - 10.1.2
"Environmental Laws" - 5.1.32
"Equipment" - Mortgage
"Event of Default" - 9.1
"Exchange Act" - 10. 1.2
"Funds" - 4.10.1
"Hazardous Substances" - 5.1.32
"Improvements" - Mortgage
"Indemnified Liabilities" - 6.16
"Indemnified Party" - 6.16
"Insurance Premiums" - 8.1.2
"Insured Casualty" - 8.2.2
"Issuer" - 10.1.3
"Late Payment Charge" - 3.4.3
"Lease Termination Payments" - 4.5.1
"Lender's Consultant" - 6.10.2
"Letter of Credit Proceeds Fund" - 4.2
"Liabilities" - 10.1.3
"Licenses" - 5.1.22
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"Lockbox Account" - 4.1.1
"Major Decisions" - 7.7
"Management Consultant" - 6.13.2
"Manager Consent and Subordination Agreement" - 6.13.3
"Master Estoppel" - 6.21
"Minimum Reserve Balance" - 4.6.1
"Monthly Insurance Amount" - 4.3
"Monthly Operating Expense Deposit" - 4.7.1
"Monthly Replacement Deposit" - 4.4.1
"Monthly Rollover Deposit" - 4.5.1
"Monthly Insurance Amount" - 4.3
"Monthly Tax Amount" - 4.3
"Mortgage" - Definition of "Loan Documents"
"New Construction Proceeds" - 6.3.4
"Note" - 2.1.2
"Operating Budget" - 6.9.5
"Operating Expense Account" - 4.1.3
"Operating Expense Reserve Fund" - 4.7.1
"Other Taxes" - 3.5
"Phase II" - 6.10.2
"Pledge and Security Agreement" - 7.7(a)
"Policies" - 8.1.2
"Principal" - 2.1.1
"Proceeds" - 8.2.2
"Provided Information" - 10.1.1
"Reduced Rating" - 4.2
"Registration Statement" - 10.1.3
"Remedial Work" - 6.10.2
"Rent Roll" - 5.1.26
"Replacement Budget" - 6.9.5
"Replacement Reserve Account" - 4.1.3
"Replacement Reserve Fund" - 4.4.1
"Responsible Officer" - 11.2.1
"Restoration" - 8.4.1
"Rollover Reserve Account" - 4.1.3
"Rollover Reserve Fund" - 4.5.1
"Securities" - 10.1.1
"Securities Act" - 10.1.2
"Secondary Market Transaction" - 10.1.1
"Successor Borrower" - 2.4.4
"Tax and Insurance Escrow Fund": - 4.3
"Tax and Insurance Account" - 4.1.3
"Transfer" - 7.7
"UBS Group" - 10.1.3
"Underwriter Group" - 10.1.3
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"Underwriters" - 10.1.3
"Voluntary Prepayment" - 3.2.1
"▇▇▇▇" - 7.7
"WEA" - 7.7
"Westfield" - 7.7
"Year 2000" - 6.18
1.3 Principles of Construction. Unless otherwise specified, (i) all
references to sections and schedules are to those in this Agreement, (ii) the
words "hereof," "herein" and "hereunder" and words of similar import refer to
this Agreement as a whole and not to any particular provision, (iii) all
definitions are equally applicable to the singular and plural forms of the terms
defined, (iv) the word "including" means "including but not limited to," and (v)
accounting terms not specifically defined herein shall be construed in
accordance with GAAP.
II THE LOAN
2.1 The Loan.
2.1.1 Commitment. Subject to and upon the terms and conditions of
this Agreement, Lender agrees to make a loan to the Borrower on the Closing Date
in an aggregate maximum principal sum of $144,380,000.00 (the "Principal").
Borrower may request and receive only one borrowing hereunder in respect of the
Loan, except the New Construction Proceeds are to be funded separately to an
account as designated by Borrower and UBS. The Loan shall mature on the Stated
Maturity Date. No amount borrowed and repaid hereunder in respect of the Loan
may be reborrowed.
2.1.2 Note. The Loan shall be evidenced by a promissory note in the
maximum principal sum of $144,380,000.00 (the "Note") executed by Borrower and
secured by the Mortgage, the Assignment of Leases and the other Loan Documents.
2.1.3 Use of Loan Proceeds. The proceeds of the Loan shall be used
by the Borrower for certain Affiliate matters and to (i) repay and discharge
existing loans relating to the Collateral Property; (ii) fund certain of the
Funds required to be funded by Borrower; (iii) pay approved costs and expenses
in connection with the foregoing and the Loan; and (iv) make distributions to
the members or partners of such Borrower to the extent any Loan proceeds remain
upon payment of the aforementioned items.
2.2 Conditions Precedent to Closing. The obligation of Lender to make the
Loan hereunder is subject to the fulfillment by Borrower of the following
conditions precedent no later than the Closing Date.
2.2.1 Representations and Warranties; Compliance with Conditions.
The representations and warranties of Borrower contained in this Agreement and
the other Loan Documents shall be true and correct in all material respects on
and as of the Closing Date with the same effect as if made on and as of such
date, and no Default or an Event of Default shall have occurred and be
continuing; and Borrower shall be in compliance in all material respects with
all terms and conditions set forth in this Agreement and in each other Loan
Document on its part to be observed or performed.
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2.2.2 First Mortgage and Loan Documents. A Mortgage which shall
constitute a valid first mortgage lien on the fee simple title to the Collateral
Property, which shall secure the Debt, subject only to such Liens as are
acceptable to Lender, and Owner shall have delivered UCC-1 financing statements
covering fixtures owned or to be owned by Owner and affixed to, or used in
connection with, the Collateral Property, in each case appropriately completed
and duly executed and delivered to Lender, or at Lender's discretion, the Title
Company, for filing in the appropriate county and state offices. Lender shall
have also received from Borrower fully executed and duly delivered counterparts
of this Agreement, the Note and each of the other Loan Documents.
2.2.3 Title Insurance. Lender shall have received a Title Insurance
Policy for the Collateral Property and the Borrower shall have paid to the Title
Company (and shall have delivered to Lender evidence of such payment) all
premiums, and expenses of the Title Company in connection with the issuance of
such Title Insurance Policy and an amount equal to the recording and the
applicable stamp taxes (including mortgage recording taxes), if any, payable in
connection with recording the insured Mortgage in the appropriate county land
offices. Such Title Insurance Policy shall (i) provide coverage in amounts
satisfactory to Lender, (ii) insure Lender that the Mortgage creates a valid
first priority lien on the Collateral Property free and clear of all exceptions
from coverage other than Permitted Encumbrances and standard exceptions and
exclusions from coverage (as modified by the terms of any endorsements), (iii)
contain such endorsements and affirmative coverages as Lender may request, and
(iv) name Lender and its successors and assigns as the insured. The Title
Insurance Policy shall be assignable.
2.2.4 Environmental Audit. Lender shall be satisfied that (A) there
are no pending or threatened claims, suits, actions or proceedings arising out
of or relating to the existence of any Hazardous Substances at, in, on or under
the Collateral Property, (B) the Collateral Property is in compliance in all
material respects with all applicable Environmental Laws, and (C) no Hazardous
Substances exist at, in, on or under the Collateral Property except in
compliance in all material respects with applicable Environmental Laws. Lender
shall have received, without limitation, (1) a comprehensive environmental audit
of the Collateral Property (which shall include a visual survey, a record
review, an area reconnaissance and a Phase I environmental study and, if the
Phase I study shall so require, a Phase II environmental study), reasonably
satisfactory in form and substance to Lender, conducted and certified by a
qualified, independent environmental consultant within six (6) months of the
Closing Date, (2) evidence that all required approvals have been obtained from
all governmental and quasi-governmental authorities having jurisdiction with
respect to the Collateral Property, and (3) such other environmental reports,
inspections and investigations pertaining to the Collateral Property as Lender
shall require, prepared, in each instance, by engineers or other consultants
reasonably satisfactory to Lender.
2.2.5 Insurance. Lender shall have received evidence of the
existence of all insurance required to be maintained by Owner or Borrower
pursuant to the Loan Documents and the designation of Lender as the mortgagee
and loss payee or additional insured, as applicable, thereunder to the extent
required by the Loan Documents, in form and substance specified in the Loan
Documents, and evidence of the payment of all premiums payable for the existing
policy period.
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2.2.6 Financial Statements. Lender shall have received, with respect
to the Collateral Property, (i) an unaudited operating statement for the
trailing twelve (12) month period, certified by the Chief Financial Officer or
Treasurer of Owner and a statement of current operations certified by the Owner
Representative and (ii) audited combined financial statements for Owner for
calendar year 1998. If Lender determines, in its sole discretion, that there
have been significant changes at the Collateral Property since the most recent
audited financial statement delivered to Lender, Owner shall deliver to Lender a
letter from an accounting firm acceptable to Lender in its sole discretion
verifying current expenses and revenue of the Collateral Property.
2.2.7 Searches. Lender shall have received copies of UCC filing
searches, tax lien searches, judgment searches and real estate tax searches and
municipal department searches setting forth any and all building violations (if
available) in the county where the Collateral Property is located (and in the
case of UCC filing searches, in the office of the Secretary of State or other
applicable state office of the State where the Collateral Property is located),
demonstrating as of a recent date the existence of no other financing
statements, tax liens, judgments, building violations or delinquent real estate
taxes, together with evidence that all fees payable in connection with any such
searches have been paid.
2.2.8 Survey. Lender shall have received a Survey of the Collateral
Property that is satisfactory to Lender and certified to Lender and its
successors and assigns, the Title Company and any other parties requested by
Lender as of a certification date satisfactory to the Title Company and
reasonably satisfactory to Lender.
2.2.9 Management. The Manager of the Collateral Property shall have
executed and delivered a manager consent and subordination in accordance with
Section 6.13.3.
2.2.10 Leases and Material Contracts. Lender shall have received
certified copies of all Leases, reciprocal easement agreements and material
contracts relating to the Collateral Property, including all amendments and
modifications thereto, and such Leases, reciprocal easement agreements and
contracts shall be in form and substance reasonably satisfactory to Lender.
2.2.11 UBS Letter of Credit. Lender shall have received the UBS
Letter of Credit in form, substance and content acceptable to Lender.
2.2.12 Tenant Estoppels. Lender shall have received an executed
tenant estoppel letter, which shall be in form and substance satisfactory to
Lender, from (a) each Anchor Tenant, (b) each Tenant paying base rent in an
amount equal to or exceeding five percent (5%) of the Operating Income from the
Collateral Property occupied by such Tenant and (c) disregarding the area leased
by those described in clauses (a) and (b), lessees of not less than seventy-five
percent (75%) of the remaining gross leasable area of the Collateral Property.
2.2.13 Property Condition Report. Lender shall have received reports
covering the physical and structural condition of the Collateral Property in
form and substance, and prepared by a qualified independent engineer, reasonably
satisfactory to Lender and dated no more than six (6) months prior to the
Closing Date, which shall (i) identify code and ADA
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compliance, (ii) include a schedule of deferred maintenance and the cost
thereof, (iii) include a schedule of all capital expenditures projected to be
required in the twelve (12) year period following the Closing Date, and (iv) if
the Collateral Property is in a State in which Lender reasonably determines that
there has been a history of earthquakes, assess the probable maximum loss in the
event of the occurrence of an earthquake.
2.2.14 Appraisal. Lender shall have received an Acceptable Appraisal
of the Collateral Property.
2.2.15 Zoning Compliance, Etc. Lender shall have received, with
respect to the Collateral Property, evidence, in the form of (i) letters or
other evidence from the appropriate municipal authorities, (ii) an ALTA 3.1
zoning endorsement (including parking coverage) for the Title Insurance Policy,
or (iii) a zoning opinion, in each case in substance reasonably satisfactory to
Lender, that all improvements constituting part of the Collateral Property have
been constructed and are being used and operated in compliance in all material
respects with (A) all applicable zoning, subdivision, environmental and other
laws, orders, rules, regulations and requirements of all governmental or
quasi-governmental authorities having jurisdiction with respect to the
Collateral Property, (B) all building permits issued in respect of the
Collateral Property, and (C) the certificates of occupancy for the Collateral
Property (copies of which certificates of occupancy shall have been delivered to
Lender).
2.2.16 Recording Taxes. Borrower shall have paid any mortgage
recording taxes payable (if any) in the jurisdiction in which the Collateral
Property is located in connection with the recordation of the Mortgage.
2.2.17 Perfection of Security Interests. Lender shall have received
evidence that all actions necessary or, in the opinion of Lender, desirable to
perfect and protect the Liens and security interests created by the Loan
Documents have been or will be taken, including evidence that the Mortgage has
been or will be duly filed and recorded in the appropriate governmental offices
and that the related UCC financing statements have been or will be duly filed in
the appropriate governmental offices.
2.2.18 Opinions of Owner's and Borrower's Counsel. Lender shall have
received an opinion of counsel as to Owner and Borrower and an opinion of local
counsel to Lender in the State in which the Collateral Property is located, in
each case with respect to such matters as Lender may request (including as to
enforceability of the Loan Documents against Owner and Borrower) and an
Insolvency Opinion with respect to Owner and Borrower, its partners, the Manager
of the Collateral Property and such other persons as Lender shall designate,
which Insolvency Opinion must be in form and substance reasonably satisfactory
to Lender.
2.2.19 Intentionally Deleted.
2.2.20 REA. If the Collateral Property is subject to an REA, such
REA is a Qualified REA.
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2.2.21 Reserves and Escrows. Borrower shall have made such initial
deposits into the Funds [,including, the Construction Interest Fund,] as Lender
may require in accordance with this Agreement and the other Loan Documents.
2.2.22 Rent Roll. A Rent Roll (in spread sheet format, containing
such information as Lender may reasonably require) for the Collateral Property,
certified by the Borrower Representative on behalf of the Borrower, shall have
been delivered to Lender.
2.2.23 Further Documents. Borrower shall have executed and delivered
to Lender such documents, opinions and agreements and taken such action
including executing such amendments or supplements to, and assumptions of, the
Loan Documents, which Lender may reasonably require.
2.2.24 Completion of Proceedings. All corporate and other
proceedings taken or to be taken by Borrower in connection with the transactions
contemplated by this Agreement and the other Loan Documents and all documents
incidental thereto shall be satisfactory in form and substance to Lender, and
Lender shall have received all such counterpart originals or certified copies of
such documents as Lender may reasonably request.
2.2.25 Delivery of Organizational Documents. Borrower shall have
delivered or caused to be delivered to Lender copies certified by the Borrower
of all organizational documentation related to Borrower and/or the formation,
structure, existence, good standing and/or qualification to do business, as
Lender may request, including, without limitation, good standing certificates,
qualifications to do business in the appropriate jurisdictions, resolutions
authorizing the entering into of the Loan and incumbency certificates as may be
reasonably requested by Lender. Owner shall have delivered or caused to be
delivered to Lender copies certified by the Owner of all organizational
documentation related to Owner and/or the formation, structure, existence, good
standing and/or qualification to do business, as Lender may request, including,
without limitation, good standing certificates, qualifications to do business in
the appropriate jurisdictions, resolutions authorizing the entering into of the
Loan and incumbency certificates as may be reasonably requested by Lender.
2.2.26 Expenses. Borrower shall have paid all amounts required to be
paid by Borrower under Section 6.15.
2.2.27 Tax Lot. Lender shall have received evidence that the
Collateral Property constitutes one (1) or more separate tax lots, which
evidence shall be reasonably satisfactory in form and substance to Lender.
2.2.28 Encumbrances. Borrower shall have taken or caused to be taken
such actions in such a manner so that Lender has a valid and perfected first
Lien as of the Closing Date with respect to the Mortgage on the Collateral
Property, subject only to applicable Permitted Encumbrances and such other Liens
as are permitted pursuant to the Loan Documents, and Lender shall have received
satisfactory evidence thereof.
2.3 Intentionally Deleted.
2.4 Defeasance.
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2.4.1 Defeasance.
(a) Provided no Event of Default shall have occurred and remain
uncured, Borrower shall have the right at any time after the Prepayment Lockout
Expiration Date and prior to the Anticipated Repayment Date to obtain a release
of the Lien of the Mortgage encumbering the Collateral Property (a
"Defeasance"), in full only and not in part, upon satisfaction of the following
conditions:
(i) Borrower shall provide Lender thirty (30) days prior written
notice specifying a Payment Date (the "Defeasance Date") on which Borrower
shall have satisfied the conditions in this Section 2.4.1 and on which it
shall effect the Defeasance;
(ii) Borrower shall pay to Lender (A) all accrued and unpaid
interest on the Principal balance of the Note to and including the
Defeasance Date and (B) all other sums, then due under the Note, this
Agreement, the Mortgage and the other Loan Documents;
(iii) Borrower shall deposit the Defeasance Collateral into the
Defeasance Collateral Account and otherwise comply with the provisions of
Sections 2.4.3 and 2.4.4 hereof;
(iv) Borrower shall execute and deliver to Lender a Security
Agreement in respect of the Defeasance Collateral Account and the
Defeasance Collateral;
(v) Borrower shall deliver to Lender (1) an opinion of counsel
for Borrower satisfactory to a prudent lender opining, among other things,
that (A) Lender has a legal and valid perfected first priority security
interest in the Defeasance Collateral Account and the Defeasance
Collateral, (B) if a Secondary Market Transaction has occurred, the REMIC
Trust formed pursuant to such Secondary Market Transaction will not fail
to maintain its status as a "real estate mortgage investment conduit"
within the meaning of Section 860D of the Code as a result of the
Defeasance pursuant to this Section 2.4.1, and (C) delivery of the
Defeasance Collateral and the grant of a security interest therein to
Lender shall not constitute an avoidable preference under Section 547 of
the U.S. Bankruptcy Code or applicable state law, and (2) an Insolvency
Opinion with respect to the Successor Borrower;
(vi) Borrower shall deliver to Lender a Rating Comfort Letter
with respect to the Defeasance;
(vii) Borrower shall deliver an Officer's Certificate certifying
that the requirements set forth in this Section 2.4.1(a) have been
satisfied;
(viii) Borrower shall deliver a certificate of Borrower's
independent certified public accountant certifying that the Defeasance
Collateral will generate monthly amounts equal to or greater than the
Scheduled Defeasance Payments;
(ix) Borrower shall deliver such other certificates, opinions,
documents and instruments as Lender may reasonably request; and
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(x) Borrower shall pay all reasonable costs and expenses of
Lender incurred in connection with the defeasance, including Lender's
reasonable attorneys' fees and expenses and Rating Agency fees and
expenses.
(b) If Borrower has elected to Defease the Note and the requirements
of this Section 2.4.1 have been satisfied, the Collateral Property shall be
released from the Lien of the Mortgage and the Defeasance Collateral, pledged
pursuant to the Security Agreement, shall be the sole source of collateral
securing the Note. In connection with the release of the Lien, Borrower shall
submit to Lender, not less than thirty (30) days prior to the Defeasance Date,
releases of Liens (and related Loan Documents) for execution by Lender. Such
releases shall be in a form appropriate in the jurisdiction in which the
Collateral Property is located and satisfactory to Lender in its reasonable
discretion. In addition, Borrower shall provide all other documentation Lender
reasonably requires to be delivered by Borrower in connection with such release,
together with an Officer's Certificate certifying that such documentation (i) is
in compliance with all Legal Requirements, and (ii) will effect such release in
accordance with the terms of this Agreement. Borrower shall pay all costs, taxes
and expenses associated with the release of the Lien of the Mortgage, including
Lender's reasonable attorneys' fees. Except as set forth in this Section 2.4.1,
or otherwise in this Agreement, no repayment, prepayment or defeasance of all or
any portion of the Note shall cause, give rise to a right to require, or
otherwise result in, the release of the Lien of the Mortgage on the Collateral
Property.
2.4.2 Intentionally Deleted .
2.4.3 Defeasance Collateral Account. On or before the date on which
Borrower delivers the Defeasance Collateral, Borrower shall open at any Eligible
Institution the defeasance collateral account (the "Defeasance Collateral
Account") which shall at all times be an Eligible Account. The Defeasance
Collateral Account shall contain only (i) the Defeasance Collateral, and (ii)
cash from interest and principal paid on the Defeasance Collateral. All cash
from interest and principal payments paid on the Defeasance Collateral shall be
paid over to Lender on each Payment Date and applied first to accrued and unpaid
interest and then to principal. Any cash from interest and principal paid on the
Defeasance Collateral not needed to pay accrued and unpaid interest or Principal
shall be retained in the Defeasance Collateral Account as additional collateral
for the Loan. Borrower shall cause the Eligible Institution at which the
Defeasance Collateral is deposited to enter into an agreement with Borrower and
Lender, satisfactory to Lender in its reasonable discretion, pursuant to which
such Eligible Institution shall agree to hold and distribute the Defeasance
Collateral in accordance with this Agreement. Borrower shall be the owner of the
Defeasance Collateral Account and shall report all income accrued on the
Defeasance Collateral for federal, state and local income tax purposes in its
income tax return. Borrower shall prepay all costs and expenses associated with
opening and maintaining the Defeasance Collateral Account. Lender shall not in
any way be liable by reason of any insufficiency in the Defeasance Collateral
Account.
2.4.4 Successor Borrower. In connection with a Defeasance under this
Section 2.4, Borrower shall establish or designate a successor entity
unaffiliated with the Borrower (the "Successor Borrower") which shall be a
Special Purpose Entity approved by Lender. Lender hereby specifically reserves
the right to require that the Successor Borrower be an Affiliate of Lender or
Servicer. Borrower shall transfer and assign all obligations, rights and
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duties under and to the Note, together with the Defeasance Collateral to such
Successor Borrower. Such Successor Borrower shall assume the obligations under
the Note and the Security Agreement and Borrower shall be relieved of its
obligations under such documents. Borrower shall pay $1,000 to any such
Successor Borrower as consideration for assuming the obligations under the Note
and the Security Agreement. Borrower shall pay all costs and expenses incurred
by Lender, including Lender's attorney's fees and expenses, incurred in
connection therewith.
III INTEREST; PAYMENTS
3.1 Interest; Monthly Loan Payments.
3.1.1 Interest Generally. Interest on the outstanding Principal
balance of the Loan shall accrue from the Closing Date to but excluding the
Maturity Date at the Applicable Interest Rate.
3.1.2 Payment Before Anticipated Repayment Date. Borrower shall pay
to Lender (a) on the first Payment Date following the Closing Date, an amount
equal to interest only on the outstanding principal balance of the Loan from the
Closing Date up to but not including such Payment Date and (b) on each Payment
Date thereafter up to but not including the Anticipated Repayment Date, an
amount equal to the Monthly Debt Service Payment Amount, which payments shall be
applied first to accrued and unpaid interest and the balance to principal.
3.1.3 Payment After Anticipated Repayment Date. Borrower shall pay
to Lender on each Payment Date on and after the Anticipated Repayment Date (a)
an amount equal to the Monthly Debt Service Payment Amount, such payment to be
applied to interest in an amount equal to interest that would have accrued on
the outstanding principal balance of the Loan (without adjustment for Accrued
Interest) at the Regular Interest Rate and the balance applied to principal and
(b) an amount equal to the Net Operating Income After Debt Service for the
preceding month, such payment to be applied to principal. Interest accrued at
the Matured Performing Rate and not paid pursuant to the preceding sentence
("Accrued Interest"), shall be added to the outstanding principal balance and
shall earn interest at the Applicable Interest Rate, to the extent permitted by
law.
3.1.4 Payment on Maturity Date. Borrower shall pay to Lender on the
Maturity Date the outstanding principal balance, all accrued and unpaid interest
(including without limitation the Accrued Interest) and all other amounts due
hereunder and under the Note, the Mortgage and other the Loan Documents.
3.1.5 Property Cash Flow Allocation.
(a) Commencing on the January, 2000 Payment Date and continuing on
each Payment Date occurring prior to the Maturity Date, except following the
acceleration of all or any part of the Debt, all Rents with respect to the
Collateral Property shall be applied as follows in the following order of
priority: (i) First, to make payments to the Tax and Insurance Escrow Fund
required to be made by Borrower, (ii) Second, to pay the monthly portion of the
Cash Management Fee due and payable by Borrower; (iii) Third, to Lender to pay
the interest payment
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and principal payment required under Section 3.1.2 or 3.1.3, as applicable,
(plus, if applicable, interest at the Default Rate and any other charges then
due to Lender under the Loan Documents); (iv) Fourth, during the continuance of
a Cash Management Event, to make payments to the Rollover Reserve Fund required
to be made by Borrower; (v) Fifth, and only during the continuance of a Cash
Management Event or the Anticipated Repayment Date, to make payments for
Approved Operating Expenses pertaining to the Collateral Property; (vi) Sixth,
during the continuance of a Cash Management Event, to make payments to the
Replacement Reserve Fund required to be made by Borrower; (vii) Lastly, payments
to Borrower of any excess amounts unless the Debt Service Coverage Ratio falls
below 1.25 (subject to a One Time Cash Management Event Cure) (the Debt Service
Coverage Ratio shall be tested on a quarterly basis at the end of each calendar
quarter (or portion thereof, if applicable) from and after the Closing Date), in
which case all Rents remaining after application thereof pursuant to subsection
(vii) hereof shall be applied by Lender in accordance with Section 4.11 until
such time as a Cash Management Termination occurs.
(b) Subject to the provisions of the Cash Management Agreement and
as otherwise set forth herein in Section 4.11, the failure of Borrower to make
all of the payments required under clauses (i) through (vi) of Section 3.1.5(a)
in full on each Payment Date shall constitute an Event of Default under this
Agreement.
(c) At any time after the Maturity Date or after the acceleration of
all or any portion of the Debt, Lender may, in its sole discretion, permit the
application of Rents in any order, and to any portion or portions of the Debt,
as Lender shall determine.
3.1.6 Payments after Default; Default Rate. After the occurrence and
during the continuance of an Event of Default, the entire unpaid Debt shall bear
interest at the Default Rate, and shall be payable upon demand from time to time
to the extent permitted by applicable law. Payment or acceptance of interest at
the Default Rate 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 Lender.
3.2 Loan Repayment; Voluntary Prepayment; Prepayment After Default.
3.2.1 Repayment. Subject to the provisions of Section 8.4 of this
Agreement, Borrower shall repay the Loan in full on the Maturity Date, together
with interest thereon to (but excluding) the date of repayment and any other
amounts due and owing under the Note, this Agreement and the other Loan
Documents. Borrower shall not have the right to prepay all or any portion of the
Principal before the Stated Maturity Date; provided, however, if no Default or
Event of Default shall then exist, and Borrower provides not less than thirty
(30) days prior written notice to Lender, (x) Borrower may prepay the Loan in
full (but not in part) without penalty or premium at any time within three (3)
months of the Anticipated Repayment Date and (y) Borrower may prepay the Loan in
full (but not in part) on any Payment Date occurring on or after the Prepayment
Lockout Expiration Date provided that such prepayment is accompanied by the
Yield Maintenance Premium applicable thereto and any other sums including all
accrued and unpaid interest on the Principal due under the Note, this Agreement
and the other Loan Documents (such repayments in (x) and (y) above being
referred to as a "Voluntary
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Prepayment"). In the event any such Voluntary Prepayment is not made on a
Payment Date, Borrower shall also pay interest that would have accrued on such
prepaid Principal to but not including the next Payment Date. Except during the
continuance of an Event of Default, all proceeds of a Voluntary Prepayment of
the Loan shall be applied by Lender as follows in the following order of
priority: (i) First, to accrued and unpaid interest on the Loan at the
Applicable Interest Rate; (ii) Second, to Principal of the Loan; and (iii)
Third, to any other amounts then due and owing under the Loan Documents. If at
any time prior to the Anticipated Repayment Date the Debt is accelerated by
reason of an Event of Default, any principal payment received by Lender (whether
as a result of a foreclosure of the Mortgage, the exercise of any of Lender's
other rights or remedies under the Loan Documents or otherwise), then Lender
shall be entitled to receive, in addition to all other sums due under the Loan
Documents, an amount equal to the Yield Maintenance Premium applicable to such
prepayment. During the continuance of an Event of Default, all proceeds of
repayment, including any payment or recovery on the Collateral Property (whether
as a result of foreclosure of the Mortgage, the exercise of any of Lender's
other rights or remedies or otherwise) shall, unless otherwise provided in the
Loan Documents, be applied in such order and in such manner as Lender shall
elect in Lender's discretion.
3.2.2 Mandatory Prepayments. The Loan is subject to mandatory
prepayment, without premium or penalty, in certain instances of Insured Casualty
or Condemnation (each a "Casualty/Condemnation Prepayment"), in the manner and
to the extent set forth in Section 8.4.2. Each Casualty/Condemnation Prepayment
shall be made on a Payment Date and shall be applied as follows in the following
order of priority: (i) First, to costs and expenses of Lender (if any),
including reasonable attorney's fees and disbursements, in connection with such
prepayment or reasonably expended by Lender to protect the collateral value of
the Collateral Property; (ii) Second, accrued and unpaid interest at the
Applicable Interest Rate; (iii) Third, to Principal; and (iv) Fourth, to any
other amounts then due and owing under the Loan Documents. If such
Casualty/Condemnation Prepayment is not paid on a Payment Date, the payment
amount will include interest that would have accrued on the Principal prepaid to
but not including the next Payment Date.
3.3 Release of Property. Except as set forth in this Section 3.3 and
otherwise set forth in this Agreement, no repayment or prepayment shall cause,
give rise to a right to require, or otherwise result in, the release of the Lien
of the Mortgage.
3.3.1 Release of Collateral Property. Borrower may obtain (i) the
release of the Collateral Property from the Lien of the Mortgage thereon (and
related Loan Documents) and (ii) the release of Owner's and Borrower's
obligations under the Loan Documents with respect to Collateral Property (other
than those expressly stated to survive), upon satisfaction of each of the
following conditions:
(a) Either (i) conditions for Voluntary Prepayment of the entire
Loan pursuant to Section 3.2.1 hereof are satisfied; or (ii) Lender is required
to release the Collateral Property pursuant to Section 2.4 in connection with a
Defeasance (it being understood that a release pursuant to Section 2.4 need not
satisfy any Release Conditions not expressly set forth in Section 2.4).
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(b) Borrower shall submit to Lender the Release Documents set forth
in Section 3.3.3 below, together with all other documentation Lender reasonably
requires to be delivered by such Borrower in connection with such release,
together with an Officer's Certificate of Borrower.
3.3.2 Release on Payment in Full. Lender shall, upon the written
request and at the expense of Borrower, upon payment in full of the Debt in
accordance herewith, release the Lien of the Mortgage if not theretofore
released.
3.3.3 Release Documents. When the terms of Section 3.3 are satisfied
with respect to the Collateral Property, Lender shall execute and deliver to the
Borrower such documents as may be necessary or appropriate to release the Owner
and Borrower from their respective obligations under the Loan Documents and to
release all liens held by Lender on the Collateral Property. All such documents
shall be prepared by Borrower's counsel, shall be in a form appropriate in the
jurisdiction in which such Collateral Property is located, shall be reasonably
acceptable to Lender in form and substance and shall be delivered to Lender at
least thirty (30) days before the proposed release date.
3.3.4 Release of Funds. Upon the completion of the release of the
Collateral Property pursuant to Section 3.3.1, the Lender shall refund to the
Borrower all amounts on deposit in the Funds with respect to the Collateral
Property.
3.4 Payments and Computations.
3.4.1 Making of Payments. Each payment by Borrower hereunder or
under the Note shall be made in funds settled through the New York Clearing
House Interbank Payments System or other funds immediately available to Lender
by 1:00 p.m., New York City time, on the date such payment is due, to Lender by
deposit to such account as Lender may designate by written notice to Borrower.
Whenever any payment hereunder or under the Note shall be stated to be due on a
day that is not a Business Day, such payment shall be made on the first Business
Day preceding such scheduled Payment Date. All payments made by Borrower
hereunder or under the other Loan Documents, shall be without any deduction,
set-off or counterclaim, whatsoever and are payable without relief from
valuation and appraisement laws and with all costs and charges incurred in the
collection or enforcement thereof, including attorneys' fees and court costs.
Payments to Lender made from the Accounts shall be deemed to have been made
before 1:00 p.m., New York City time, on the date such payment is made.
3.4.2 Interest Calculation. Interest on the outstanding principal
balance of the Loan shall be calculated by multiplying (a) the actual number of
days elapsed in the period for which the calculation is being made by (b) a
daily rate based on a three hundred sixty (360) day year by (c) the outstanding
Principal balance.
3.4.3 Late Payment Charge. If any Principal, interest or other sum
due under any Loan Document is not paid on the date on which it is due, Borrower
shall pay to Lender upon demand an amount equal to the lesser of five percent
(5%) of such unpaid sum or the maximum amount permitted by applicable law (the
"Late Payment Charge"), in order to defray the expense incurred by Lender in
handling and processing such delinquent payment and to
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compensate Lender for the loss of the use of such delinquent payment; provided
that if no such late payment has occurred within the prior twelve (12) month
period, Borrower shall only be required to pay the late payment charge provided
for in this Section 3.4.3 if such failure to pay continues for two (2) Business
Days after notice from Lender. Such amount shall be secured by the Loan
Documents. Any action by Lender regarding the collection of a Late Payment
Charge will be without prejudice to any other rights, nor act as a waiver of any
other rights, that Lender may have as provided herein, at law or in equity. No
Late Payment Charge shall be due in connection with any payment to be made from
the Accounts, provided that on the date such payment is due there are sufficient
funds in such Accounts to make the payment in question.
3.5 Taxes. Any and all payments by Borrower hereunder and under the other
Loan Documents shall be made free and clear of and without deduction for any and
all present or future taxes, levies, imposts, deductions, charges or
withholdings, and all liabilities with respect thereto, excluding taxes imposed
on Lender's income, and franchise taxes imposed on Lender by the law or
regulation of any Governmental Authority (all such non-excluded taxes, levies,
imposts, deductions, charges, withholdings and liabilities being hereinafter
referred to in this Section 3.5 as "Applicable Taxes"). If Borrower shall be
required by law to deduct any Applicable Taxes from or in respect of any sum
payable hereunder to Lender, the following shall apply provided the Applicable
Taxes do not result because the Lender (due to permitted succession or
assignment) is not a United States person as defined at section 7701(a)(30) of
the Code or the Lender has failed to provide information necessary to avoid
back-up withholding pursuant to section 3406 of the Code: (i) the sum payable
shall be increased as may be necessary so that after making all required
deductions (including deductions applicable to additional sums payable under
this Section 3.5), Lender receives an amount equal to the sum it would have
received had no such deductions been made, (ii) Borrower shall make such
deductions and (iii) Borrower shall pay the full amount deducted to the relevant
taxation authority or other authority in accordance with applicable law.
Borrower also agrees to pay any present or future stamp or documentary taxes or
any other excise or property taxes, charges or similar levies which arise from
any payment made hereunder or from the execution, delivery or recordation of, or
otherwise with respect to, this Agreement or any other Loan Document ("Other
Taxes"). Borrower shall indemnify Lender for the full amount of Applicable Taxes
or Other Taxes (including any Applicable Taxes or Other Taxes imposed by any
jurisdiction on amounts paid or payable under this Section 3.5) paid by Lender
and any liability (including penalties, interest and expenses) arising therefrom
or with respect thereto, whether or not such Applicable Taxes or Other Taxes
were correctly or legally asserted. Payments pursuant to this Section 3.5 shall
be made within fifteen (15) days after the date Lender makes written demand
therefor. Borrower shall have the right to contest such taxes referred to in
this Section 3.5 in accordance with the terms of Section 6.2 of this Agreement.
IV CASH MANAGEMENT; ESCROWS AND RESERVES
4.1 Cash Management Arrangements.
4.1.1 Lockbox Account. On or before the Closing Date, Borrower shall
open an account (the "Lockbox Account") with Agent which shall be the depository
account for Borrower into which all sums due to Borrower will be deposited. The
Lockbox Account shall be in Lender's name, or at Lender's option, in the
Servicer's name. The Lockbox Account shall be
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under the sole dominion and control of Lender. The Lockbox Account will be
opened and maintained as an Eligible Account.
4.1.2 Deposits into Lockbox Account. Owner and Borrower shall cause
all Tenants at the Collateral Property to pay Rent directly into the Lockbox
Account on or before the date such Rent is due under the terms of the applicable
Lease. When bills to Tenants are delivered pursuant to Section 6.11.6 of this
Agreement, Owner and Borrower shall send a notice, substantially in the form of
Exhibit A attached hereto, to all Tenants at the Collateral Property directing
them to pay all Rent into the Lockbox Account. In the event that Owner,
Borrower, their respective Affiliates or the Manager receives any Rents
directly, Owner and Borrower agree to deposit, or cause to be deposited, all
such Rents into the Lockbox Account within one (1) Business Day. All sums
deposited into the Lockbox Account shall be swept daily into a cash management
account established by Owner and Borrower with Agent on or before the Closing
Date (the "Cash Management Account") (the Cash Management Account shall be held
and administered in accordance with the Cash Management Agreement). The Cash
Management Account shall be in Lender's name, or at Lender's option, in the
Servicer's name. The Cash Management Account shall be under the sole dominion
and control of Lender. The Cash Management Account will be opened and maintained
as an Eligible Account. Neither the Lockbox Account, the Cash Management Account
nor the Cash Management Agreement shall alter or diminish in any way Borrower's
obligation to make timely payment and deposits to all sums required to be paid
or deposited under any Loan Document.
4.1.3 The Accounts. On or before the Closing Date, Borrower shall
open with Agent separate accounts for each of the following Funds (hereinafter
defined): Tax and Insurance Escrow Fund (the "Tax and Insurance Account"),
Replacement Reserve Fund (the "Replacement Reserve Account"), Rollover Reserve
Fund (the "Rollover Reserve Account"), Operating Expense Reserve Fund (the
"Operating Expense Account"), the Cash Collateral Fund (the "Cash Collateral
Account"), the Debt Service Reserve Fund (the "Debt Service Reserve Account"),
the Letter of Credit Proceeds (the "Letter of Credit Account") and the
Construction Interest Reserve Fund (the "Construction Interest Reserve Fund").
Tax and Insurance Escrow Fund shall be held in the Tax and Insurance Account.
Replacement Reserve Funds shall be held in the Replacement Reserve Account.
Rollover Reserve Funds shall be held in the Rollover Reserve Account. Operating
Expense Reserve Funds shall be held in the Operating Expense Account. The Debt
Service Reserve Fund shall be held in the Debt Service Reserve Account The
Letter of Credit Proceeds Fund shall be held in the Letter of Credit Account.
All Funds remaining in the Accounts after application pursuant to Sections 3.1.5
and 4.11 shall be held in the Cash Collateral Account. The accounts defined in
this Section may be hereinafter referred to from to time as an "Account" or
collectively as the "Accounts." At Lender's option, each of the Accounts shall
be opened in Lender's name or in Servicer's name. Each of the Accounts shall be
under the sole dominion and control of Lender. Each of the Accounts shall be
opened and maintained as an Eligible Account.
4.2 Letter of Credit Proceeds Fund. Pursuant to the terms of the Letter of
Credit Agreement, in the event that:
(a) If, sixty days prior to the maturity date of the UBS Letter of
Credit, (1) Completion (as defined in the Letter of Credit Agreement) has not
occurred on or before June 30,
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2001, (2) the Letter of Credit Amount (as defined in the Letter of Credit
Agreement) has not yet been reduced to zero, or (3) an Event of Default has
occurred and is continuing, Lender shall have the right, upon notice to the
Borrower of such failure, to draw upon the UBS Letter of Credit in full and the
proceeds thereof (the "Letter of Credit Proceeds") shall be applied to the
outstanding principal amount of the Note and any other Obligations of Borrower
under the Loan Documents.
(b) In the event that (i) Borrower fails to renew the UBS Letter of
Credit delivered under the Letter of Credit Agreement at least sixty (60) days
prior to its expiration for an additional period of not less than one (1) year,
provided that if the UBS Letter of Credit has a term of one (1) year it may be
extended from time to time but in no event shall it expire prior to the
satisfaction of the Cash Flow Coverage Ratio (as defined in the Letter of Credit
Agreement) governing the release of the UBS Letter of Credit set forth in
Section 4(b) of the Letter of Credit Agreement; provided, however, that UBS has
not committed to issue the UBS Letter of Credit for a term that expires after
December 9, 2001, or (ii) Borrower fails to deliver a substitute letter of
credit (in the form required under the Letter of Credit Agreement and in the
amount of such existing UBS Letter of Credit) sixty (60) days prior to the
expiration of the then existing UBS Letter of Credit from an Eligible
Institution, then, in either case, Lender shall have the right to draw upon the
UBS Letter of Credit in full and the Letter of Credit Proceeds shall be
deposited into the Letter of Credit Account and the amount of the Letter of
Credit Proceeds shall be reduced or released in accordance with Section 4(b) of
the Letter of Credit Agreement, or, for such time as such Letter of Credit
Proceeds are on deposit in the Letter of Credit Account, the Letter of Credit
Proceeds may be used by Lender to satisfy the Obligations at any time upon the
occurrence or continuation of an Event of Default or upon the occurrence of the
events set forth in subsection (a)(1) or (2) above.
(c) In the event that the long term unsecured debt rating by S&P of
any bank which has issued a Letter of Credit under the Letter of Credit
Agreement be reduced such that the issuing bank at any time does not qualify as
an Eligible Institution (any such rating, a "Reduced Rating"), Borrower shall
within five (5) days after the date on which such Reduced Rating shall have been
assigned deliver to Lender a substitute letter of credit from an Eligible
Institution in the form annexed to the Letter of Credit Agreement and in the
amount of the existing Letter of Credit relating to New Construction (which
substitute letter of credit shall thereupon become the Letter of Credit). If
Borrower shall fail to comply with the terms of the preceding sentence, Lender
shall have the right to draw upon the UBS Letter of Credit in full and the
Letter of Credit Proceeds thereof shall be deposited into the Letter of Credit
Account pursuant to the Loan Agreement and shall be retained therein as
additional security for the Obligations. Such Letter of Credit Proceeds shall be
subject to reduction or release pursuant to the terms of Section 4(b) of the
Letter of Credit Agreement until the date upon which such Letter of Credit
should have been released or if the conditions for release have not been
satisfied the Letter of Credit Proceeds may be used by Lender to satisfy the
Obligations at any time upon the occurrence or continuation of an Event of
Default or upon the occurrence of the events set forth in subsection (a)(1) or
(2) above.
4.3 Tax and Insurance Escrow Fund. Borrower shall pay to Lender on each
Payment Date (i) one-twelfth (1/12th) of the Taxes for the Collateral Property
that Lender estimates will be payable during the next twelve (12) months in
order to accumulate with Lender sufficient funds
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to pay all such Taxes at least thirty (30) days prior to their respective due
dates ("Monthly Tax Amount"), and (ii) one-twelfth (1/12th) of the Insurance
Premiums that Lender estimates will be payable for the renewal of the coverage
afforded by the Policies relating to the Collateral Property upon the expiration
thereof in order to accumulate with Lender sufficient funds to pay all such
Insurance Premiums at least thirty (30) days prior to the expiration of such
Policies ("Monthly Insurance Amount") (the amounts paid under the foregoing
clauses (i) and (ii) with respect to the Collateral Property, less disbursements
thereof pursuant hereto, being called the "Tax and Insurance Escrow Fund").
Lender will (a) apply the Tax and Insurance Escrow Fund to payments of Taxes and
Insurance Premiums required to be made by Borrower pursuant to Sections 6.2 and
8.1 prior to the date upon which interest or penalties would be imposed,
provided that Borrower has promptly supplied Lender with notices of all Taxes
and Insurance Premiums due for the Collateral Property, or (b) reimburse
Borrower for such amounts upon presentation of evidence of payment and an
Officer's Certificate in form and substance satisfactory to Lender; subject,
however, to Borrower's right to contest Taxes in accordance with Section 6.2.
Following the payment by Lender of any Taxes pursuant to this Section 4.3,
Lender shall send a "paid" receipt to the Borrower. Provided Borrower has
deposited funds into the Tax and Insurance Escrow Fund as required under this
Section and given Lender timely notice of the amount and due date of such taxes,
Borrower shall not be liable for interest or penalties resulting from late
payment of such Taxes by Lender, and, so long as no portion of the Debt has been
accelerated, Lender or Servicer shall be responsible for such interest and
penalties. In making any payment relating to the Tax and Insurance Escrow Fund,
Lender may do so according to any ▇▇▇▇, statement or estimate procured from the
appropriate public office (with respect to Taxes) or insurer or agent (with
respect to Insurance Premiums), without inquiry into the accuracy of such ▇▇▇▇,
statement or estimate or into the validity of any tax, assessment, sale,
forfeiture, tax lien or title or claim thereof. If the amount of the Tax and
Insurance Escrow Fund shall exceed the amounts next coming due for Taxes and
Insurance Premiums pursuant to Sections 6.2 and 8.1, Lender shall, in its sole
discretion, return any excess to the applicable Borrower or credit such excess
against future payments to be made to the Tax and Insurance Escrow Fund. If at
any time Lender determines that the Tax and Insurance Escrow Fund is not or will
not be sufficient to pay the Taxes or Insurance Premiums next coming due, Lender
shall notify the Borrower of such determination and the Borrower shall increase
the monthly payments to Lender by the amount that Lender estimates is sufficient
to make up the deficiency at least thirty (30) days prior to delinquency of the
Taxes and/or expiration of the Policies, as the case may be. Lender acknowledges
that Borrower currently causes its Premiums to be paid by Afco Acceptance Corp.
("Afco") through an agreement with Westfield America, Inc., and Lender agrees
that amounts for the Borrower's Premiums held in the Tax and Insurance Escrow
Fund shall be released to reimburse the Borrower for payments made by it to
reimburse Westfield America, Inc. for the amounts paid to Afco with respect to
the Borrower's Premiums (subject to compliance by Borrower with clause (b) of
this Section 4.3 or any other similar arrangements reasonably acceptable to
Lender.
4.4 Replacements and Replacement Reserves.
4.4.1 Replacement Reserve Fund. Upon the occurrence of a Cash
Management Event, Borrower shall pay to Lender on each Payment Date thereafter
(in addition to other payments required hereunder) an amount equal to the
Monthly Replacement Deposit for the Collateral Property (such payments, less
disbursements thereof pursuant hereto, being called
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the "Replacement Reserve Fund"). If the amount of the Replacement Reserve Fund
shall exceed the amounts due for Approved Replacement Expenses pursuant to the
terms hereof, Lender shall, in its discretion, return any excess to the Borrower
or, if future Replacement Reserve Fund payments are then required, credit such
excess against such future payments.
4.4.2 Payment of Replacement Expenses. From time to time (but not
more often than monthly), Lender shall disburse funds held in the Replacement
Reserve Fund to Borrower, within thirty (30) days after the delivery by Borrower
to Lender of a request therefor, in increments of at least $5,000; provided,
that (i) on the day of the request and on the day of payment no Event of Default
shall have occurred and be continuing; (ii) such disbursement is for a
Replacement Expense that has been incurred by Owner or Borrower (provided that,
during the continuance of a Cash Management Event, such Replacement Expense must
be an Approved Replacement Expense); (iii) Lender shall have (if it desires)
verified (by an inspection conducted at Borrower's expense) performance of the
work associated with such Approved Replacement Expense (or Replacement Expense,
as the case may be); and (iv) the request for disbursement is accompanied by (A)
an Officer's Certificate certifying (v) the amount of funds to be disbursed, (w)
that such funds will be used to pay or reimburse Owner or Borrower for Approved
Replacement Expenses (or Replacement Expenses, as the case may be) and a
description thereof, (x) that all outstanding trade payables (other than those
to be paid from the requested disbursement or those otherwise permitted to be
outstanding under Section 7.8) have been paid in full, (y) that the same has not
been the subject of a previous disbursement, and (z) that all previous
disbursements have been used to pay the previously identified Approved
Replacement Expenses (or Replacement Expenses, as the case may be), and (B)
reasonably detailed documentation as to the amount, necessity and purpose
therefor.
4.5 Rollover Reserves.
4.5.1 Rollover Reserve Fund. Upon the occurrence of a Cash
Management Event, Borrower shall pay to Lender on each Payment Date thereafter
monthly deposits for the payment of Approved Leasing Expenses (the "Monthly
Rollover Deposit") for the Collateral Property (in addition to other payments
required hereunder) (such payments, less disbursements thereof pursuant hereto,
being called the "Rollover Reserve Fund") or, at Borrower's option, shall post a
Letter of Credit in such amount determined by Lender based on $.75 a square foot
of gross leasable area excluding Anchor Tenant space for each Collateral
Property. Lender will apply such payments to payment of Approved Leasing
Expenses pursuant to the terms hereof. Borrower shall also deposit into the
Rollover Reserve Fund all payments ("Lease Termination Payments") received from
Tenants in connection with the termination or cancellation of any Lease more
than one year prior to its expiration date, including fees, penalties and
commissions (provided that, upon the releasing of all or any portion of the
space demised under such cancelled or terminated Lease, Lender shall, upon
Borrower's request and provided no Event of Default then exists, release to
Borrower the portion, if any, of the Lease Termination Payment which exceeds the
actual Leasing Expenses incurred or to be incurred in connection with such
releasing). If the amount of the Rollover Reserve Fund shall exceed the amounts
due for Approved Leasing Expenses pursuant to the terms hereof, Lender shall
retain excess Rollover Reserve Funds in accordance with Section 4.11 of this
Agreement. If Lender determines in its reasonable judgment that the amount of
the Rollover Reserve Fund will be insufficient to pay the amounts due or to
become due for Approved Leasing Expenses (after taking into account any
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Lease Termination Payments theretofore deposited into the Rollover Reserve),
Lender may adjust the monthly amounts required to be deposited into the Rollover
Reserve Fund upon thirty (30) days' notice to Borrower. Alternatively, Lender
may in its discretion determine that the amount of the Rollover Reserve Fund
will exceed the amounts due or to become due for Approved Leasing Expenses, in
which case Lender may reduce the monthly amounts to be deposited therein. Lender
shall release funds on deposit in the Rollover Reserve Fund to the Borrower in
an amount calculated based on $8.88 per square foot leased at the Collateral
Property, upon Lender's receipt from Borrower of evidence that (i) a new Lease
has been executed, (ii) the Tenant under such new Lease has taken possession of
the premises leased thereunder and has provided the Borrower and Lender with an
estoppel letter stating that the Tenant has commenced paying rent pursuant to
the terms of its Lease, (iii) all tenant improvement costs or other Approved
Leasing Expenses have been paid pursuant to the terms of the new Lease, and (iv)
any leasing commissions have been paid and there are no outstanding monetary
obligations of the Borrower to the Tenant or any third party due under such new
Lease.
4.5.2 Payment of Leasing Expenses. From time to time (but not more
than once per month) Lender shall disburse funds held in the Rollover Reserve
Fund to Borrower, within fifteen (15) days after the delivery by Borrower to
Lender of a request therefor, in increments of at least $5,000; provided, (i) on
the day of the request and on the day of payment no Event of Default shall have
occurred and be continuing; (ii) such disbursement is for an Approved Leasing
Expense; (iii) Lender shall have (if it desires) verified (by an inspection
conducted at Borrower's expense) performance of any construction work associated
with such Approved Leasing Expense; and (iv) the request for disbursement is
accompanied by (A) an Officer's Certificate certifying (v) the amount of funds
to be disbursed, (w) that such funds will be used only to pay (or reimburse
Owner or Borrower for) Approved Leasing Expenses and a description thereof, (x)
that all outstanding trade payables (other than those to be paid from the
requested disbursement or those otherwise permitted to be outstanding under
Section 7.8) have been paid in full, (y) that the same has not been the subject
of a previous disbursement, and (z) that all previous disbursements have been
used only to pay (or reimburse Owner or Borrower for) the previously identified
Approved Leasing Expenses, and (B) reasonably detailed supporting documentation
as to the amount, necessity and purpose therefor. During the continuance of a
Cash Management Event, any such disbursement to pay (rather than reimburse)
Approved Leasing Expenses may, at Lender's option, be made by joint check
payable to Borrower and the payee of such Approved Leasing Expenses.
4.6 Construction Interest Reserve.
4.6.1 Construction Interest Reserve Fund.
(a) Borrower shall deposit with the Lender on the date hereof the
amount of $1,016,043.71 or an amount equal to nine (9) months of interest at the
rate of 8.177% per annum on an amount equal to $12,612,078 which shall be held
by the Lender in the Construction Interest Reserve Account (the "Construction
Interest Reserve Fund").
(b) Borrower shall deposit in the Construction Interest Reserve Fund
on the date hereof the additional amount of $112,890.00 (the "Minimum Reserve
Balance") or one month's interest at 8.177% per annum on $12,612,078.
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(c) Borrower hereby instructs the Agent, for the benefit of Lender,
to withdraw from the Construction Reserve Account by 10:00 A.M. New York time on
the Business Day immediately prior to each Payment Date during the period from
and including February 11, 2000 through and including October 11, 2000, an
amount equal to $112,890 per month to be applied as partial payment of the Note.
Any portion of the $1,016,043.71 remaining in the Construction Interest Reserve
Account after October 11, 2000, may, at the direction of the Borrower, be
released to the Borrower or be made available to the Lender to fund future
payments of interest payable under the Note and this Agreement. An amount equal
to the Minimum Reserve Balance must be maintained in the Construction Interest
Reserve Account held by the Agent through the date on which the UBS Letter of
Credit is reduced to zero in accordance with the terms of the Letter of Credit
Agreement. Upon the reduction of the amount of the UBS Letter of Credit,
Borrower shall deliver to the Agent a statement setting forth the revised
Minimum Reserve Balance and any amounts being held by Agent in excess of the
revised Minimum Reserve Balance may, at the direction of the Borrower, be
delivered to the Borrower or be made available to the Lender to fund future
payments of interest on the Notes. If at any time after October 11, 2000,
Borrower fails to fund the full interest payment due on the Note in accordance
with the terms of the Note and this Loan Agreement, the Agent, as agent for
Lender, shall draw from the Construction Interest Reserve Account sufficient
sums from the Minimum Reserve Balance to pay current interest due on the Note.
Within five (5) days of such drawing, Borrower shall deliver funds to the Agent
for deposit into the Construction Interest Reserve Account to fund any shortfall
in the Minimum Reserve Balance. The Borrower's failure to restore the Minimum
Reserve Balance shall constitute an Event of Default under this Agreement, the
Note and the other Loan Documents. After drawing any portion of the Minimum
Reserve Balance from the Construction Interest Reserve Account, the Agent shall
so notify the Lender and shall further notify the Lender upon the earlier of (i)
the date that the Borrower deposits the funds required to restore the Minimum
Reserve Balance in the Construction Interest Reserve Account, and (ii) the date
which is five (5) days following such drawing from the Construction Interest
Reserve Account.
4.7 Operating Expense Reserves.
4.7.1 Operating Expense Reserve Fund. After the occurrence of a Cash
Management Event or the Anticipated Repayment Date, Borrower shall pay to Lender
an amount equal to the Approved Operating Expenses for the Collateral Property
for the next Current Month (the "Monthly Operating Expense Deposit") (such
payments, less disbursements thereof pursuant hereto, being called the
"Operating Expense Reserve Fund"). If the amount of the Operating Expense
Reserve Fund shall exceed the amounts due for Approved Operating Expenses
pursuant to the terms hereof, Lender shall retain excess Operating Expense
Reserve Funds in accordance with Section 4.11 of this Agreement.
4.7.2 Payment of Approved Operating Expenses. From time to time (but
not more than once per month) following the occurrence of a Cash Management
Event or the Anticipated Repayment Date, Lender shall disburse funds held in the
Operating Expense Reserve Fund to Borrower, provided (i) on the day of the
request and on the date of payment no portion of the Debt shall have been
accelerated; (ii) such disbursement is for an Approved Operating Expense; and
(iii) such disbursement is requested by Borrower in writing, accompanied by (A)
an Officer's Certificate certifying (v) the amount of funds to be disbursed, (w)
that such
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funds will be used to pay Approved Operating Expenses and a description thereof,
(x) that all outstanding trade payables (other than those to be paid from the
requested disbursement or those otherwise permitted to be outstanding under
Section 7.8) have been paid in full, (y) that the same has not been the subject
of a previous disbursement, and (z) that all previous disbursements have been or
will be used to pay the previously identified Approved Operating Expenses, and
(B) reasonably detailed documentation as to the amount, necessity and purpose
therefor. Subject to satisfaction of the preceding conditions, if Lender
receives from Borrower a valid request for a disbursement for payment of
Approved Operating Expenses for the then Current Month at least five (5)
Business Days prior to the Payment Date occurring in such Current Month, then
the disbursement in respect of such Approved Operating Expenses shall be made to
Borrower on such Payment Date. Notwithstanding anything to the contrary in the
foregoing, during the continuance of an Event of Default Lender shall have the
right, in lieu of disbursing to Borrower funds from the Operating Expense
Reserve Fund, to pay such funds directly to the obligees or to pay such funds to
Borrower and the obligee in question jointly.
4.8 Casualty/Condemnation Fund. The Borrower shall pay, or cause to be
paid, to Lender all Proceeds or Awards due to any Casualty or Condemnation (such
amounts, less disbursements thereof pursuant hereto, the "Casualty/Condemnation
Fund"), in accordance with the provisions of Sections 8.2.2 and 8.3.2 of this
Agreement. All amounts in the Casualty/Condemnation Fund shall be disbursed in
accordance with the provisions of Article VIII.
4.9 Security Deposits.
(a) Security deposits under Leases shall not be commingled with any
other funds of Owner or Borrower (unless permitted by applicable Legal
Requirements) and all security deposits paid in cash under Leases, shall, unless
permitted to be commingled with Owner's or Borrower's funds under applicable
Legal Requirements, be deposited by Borrower, or Borrower shall cause same to be
deposited, into an account with the Agent. After the occurrence of a Cash
Management Event, upon Lender's request, if permitted by applicable Legal
Requirements, Borrower shall turn over, or caused to be turned over to Lender
the security deposits (and any interest theretofore earned thereon) under
Leases, to be held by Lender subject to the terms of the Leases. If applicable
Legal Requirements prohibit Owner or Borrower from turning over to Lender
security deposits under Leases, Borrower shall keep, or cause Owner to keep,
such security deposits at a separately designated account at the Agent so that
the security deposits shall not be commingled with any other funds of Owner or
Borrower. Security deposits held by the Lender will be released by Lender upon
notice from Owner or Borrower together with such evidence as Lender may
reasonably request that such security deposit is required to be returned to a
Tenant pursuant to the terms of a Lease or may be applied as Rent pursuant to
the rights of Owner or Borrower under the applicable Lease.
(b) Any letter of credit or other instrument that Borrower receives
in lieu of a cash security deposit shall (i) be maintained in full force and
effect in the full amount unless replaced by a cash deposit as hereinabove
described, (ii) if pertaining to a Material Lease, be issued by an institution
reasonably satisfactory to Lender, (iii) if permitted pursuant to any Legal
Requirements, name Lender as payee or mortgagee thereunder (or be fully
assignable to Lender) and (iv) in all respects, comply with any applicable Legal
Requirements and, if pertaining to a
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Material Lease, otherwise be reasonably satisfactory to Lender. Upon request,
Borrower shall provide, or cause to be provided, to Lender with evidence
reasonably satisfactory to Lender of Owner's and Borrower's compliance with the
foregoing.
4.10 Funds, Generally.
4.10.1 Grant of Security Interest; Application of Funds. As
additional security for Borrower's payment of the Debt and the performance by
Borrower of all other terms, conditions and provisions of the Loan Documents,
Owner and Borrower hereby pledge and assign to Lender, and grants to Lender a
security interest in, all right, title and interest of Owner and Borrower in and
to all Rents and in and to all payments to or monies held in the Lockbox
Account, the Cash Management Account, the Accounts (collectively, the "Cash
Management Accounts") and in the Casualty/Condemnation Fund (all amounts held in
the Accounts, the Casualty/Condemnation Fund, together with all other funds
designated as or deemed to be "Funds" under this Agreement, are referred to
herein as the "Funds"). Owner and Borrower for themselves and on behalf of each
of their respective Affiliates and the Manager hereby grant to Lender a
continuing security interest in, and agrees to hold in trust for the benefit of
Lender, all Rents in its possession prior to the (i) payment of such Rents to
Lender or (ii) deposit of such Rents into the Lockbox Account in accordance with
this Agreement and the Cash Management Agreement. Neither Owner nor Borrower
shall, without obtaining the prior written consent of Lender, further pledge,
assign or grant any security interest in any Cash Management Account or Fund, or
permit any Lien to attach thereto, or any levy to be made thereon, or any UCC-1
Financing Statements, except those naming Lender as the secured party, to be
filed with respect thereto. This Agreement is, among other things, intended by
the parties to be a security agreement for purposes of the UCC. Upon the
occurrence and during the continuance of an Event of Default, Lender may apply
any sums in the Cash Management Accounts as provided under Section 3.1.5(c).
4.10.2 Investments of Funds. Lender shall direct the Agent to invest
any balances in the Accounts in Permitted Investments as instructed by Borrower,
provided that (i) if Borrower fails to so instruct Lender, or upon the
occurrence and continuation of a Cash Management Event, Lender may direct the
Agent to invest and reinvest such balances of the Funds in Permitted Investments
as Lender shall determine in its sole discretion, (ii) the maturities of the
Permitted Investments on deposit in the Accounts shall be selected and
coordinated to become due not later than one day before any disbursements from
the Accounts must be made, (iii) all such Permitted Investments shall be held in
the name of and be under the sole dominion and control of Lender and subject at
all times to the terms hereof, and (iv) no Permitted Investment shall be made
unless Lender shall have and continue to have a perfected first priority Lien in
such Permitted Investment securing the obligations of Borrower hereunder and
under the other Loan Documents and all filings and other actions necessary to
ensure the validity, perfection, and first priority of such Lien shall have been
taken. Lender shall have no liability for any loss investments of Funds in the
Accounts that are invested in Permitted Investments and no such loss shall
affect Owner's or Borrower's obligations to make the deposits into the Funds
pursuant to this Agreement. Borrower shall report on its federal, state and
local income tax reports at interest or income accrued on Funds in the Accounts.
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4.11 Cash Collateral Fund.
(a) After the occurrence of a Cash Management Event, all Rents
remaining in the Accounts after application thereof pursuant to items (i)
through (vi) of Section 3.1.5(a), shall be transferred to the Cash Collateral
Account (all funds at any time in the Cash Collateral Account being called the
"Cash Collateral Fund").
(b) Funds in the Cash Collateral Account which originally
constituted a part of the Replacement Reserve Fund or the Rollover Reserve Fund
shall be held in the Cash Collateral Account for future disbursement by Lender,
provided no Event of Default then exists, for Approved Replacement Expenses and
Approved Leasing Expenses, respectively, to the extent, but only to the extent,
that Borrower's required Monthly Reserve Deposits and/or required Monthly
Rollover Deposits, respectively, are insufficient to pay for same. Funds in the
Cash Collateral Account which originally constituted a part of some other Fund
shall be held in the Cash Collateral Account for future application, provided no
Event of Default then exists, to such Funds, in such order and manner as Lender
may elect in its sole and absolute discretion.
(c) Any funds deposited with the Lender in connection with a One
Time Cash Management Event Cure shall be secured by the Mortgages and be
otherwise applied in accordance with the terms of this Section 4.11 if the One
Time Cash Management Event Cure does not prevent a Cash Management Event from
occurring at the end of the following quarter upon the Lender's determination of
the Debt Service Coverage Ratio. If there is no Cash Management Event upon such
subsequent determination of the Debt Service Coverage Ratio, or a Cash
Management Termination has occurred, the funds deposited with the Lender in
connection with a One Time Cash Management Event Cure shall be returned to the
Borrower pursuant to subsection (d) below.
(d) Upon a Cash Management Termination, Lender shall deliver to
Borrower, on the next Business Day, all Funds (other than Funds in the Tax and
Insurance Escrow Fund) then on deposit in the Cash Collateral Account.
V REPRESENTATIONS AND WARRANTIES
5.1 Owner and Borrower Representations. Each of Owner and Borrower
represent and warrant as to itself, as of the date hereof that, except to the
extent (if any) disclosed on Schedule 3 with reference to a specific subsection
of this Section 5.1:
5.1.1 Organization; Special Purpose. Each of Owner and Borrower has
been duly organized and is validly existing and in good standing under the laws
of the state of its formation, with requisite power and authority, and all
rights, licenses, permits and authorizations, governmental or otherwise,
necessary to own its properties and to transact the business in which it is now
engaged. Each of Owner and Borrower is duly qualified to do business and is in
good standing in each jurisdiction where it is required to be so qualified in
connection with its properties, business and operations. Each of Owner and
Borrower is a Special Purpose Entity, and the sole business of (i) Owner is the
ownership, management and operation of the Collateral Property, and (ii)
Borrower is its role as borrower hereunder and under the other Loan Documents to
which it is a party
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5.1.2 Proceedings; Enforceability. Each of Owner Borrower has taken
all necessary action to authorize the execution, delivery and performance of the
Loan Documents to which it is a party. The Loan Documents to which each of Owner
and/or Borrower is a party have been duly executed and delivered by Owner or
Borrower, as applicable, and constitute legal, valid and binding obligations of
Owner and Borrower, as applicable, enforceable against Owner and Borrower, as
applicable, in accordance with their respective terms, subject to applicable
bankruptcy, insolvency and similar laws affecting rights of creditors generally,
and general principles of equity (regardless of whether enforcement is sought in
a proceeding in equity or at law).
5.1.3 No Conflicts. The execution, delivery and performance by each
of Owner or Borrower, as applicable, of the Loan Documents to which it is a
party will not 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 (other than pursuant to the Loan Documents) upon any of
the property of Owner or Borrower, as applicable, pursuant to the terms of, any
agreement or instrument to which Owner or Borrower, as applicable, is a party or
by which its property is subject, nor will such action result in any violation
of the provisions of any statute or any order, rule or regulation of any
Governmental Authority having jurisdiction over Owner or Borrower or any of
their respective properties. Neither Owner's nor Borrower's rights under the
Licenses and the Management Agreement will be adversely affected by the
execution and delivery of the Loan Documents, Owner's or Borrower's performance
thereunder, the recordation of the Mortgage or the exercise of any remedies by
Lender. Any consent, approval, authorization, order, registration or
qualification of or with any Governmental Authority required for the execution
and delivery by Owner or Borrower, as applicable, of the Loan Documents has been
obtained and is in full force and effect.
5.1.4 Litigation. There are no actions, suits or other proceedings
at law or in equity by or before any Governmental Authority now pending or
threatened against or affecting Owner, Borrower, Owner Representative, Borrower
Representative, the Manager or the Collateral Property, which, if adversely
determined, might materially adversely affect the condition (financial or
otherwise) or business of Borrower, Owner Representative, Borrower
Representative, Manager or the condition or ownership of any Collateral
Property.
5.1.5 Agreements. Neither Owner nor Borrower is a party to any
agreement or instrument or subject to any restriction which might adversely
affect Owner or Borrower or the Collateral Property, or Owner's or Borrower's
business, properties, operations or condition, financial or otherwise. Neither
Owner nor Borrower is in default in any material respect in the performance,
observance or fulfillment of any of the obligations, covenants or conditions
contained in any Permitted Encumbrance or any other agreement or instrument to
which it is a party or by which it or the Collateral Property is bound.
5.1.6 Title. Owner has good fee title to the portion of the
Collateral Property constituting Real Property, and good title to the balance of
the Collateral Property, free and clear of all Liens except the Permitted
Encumbrances. The Mortgage executed by Owner, when properly recorded in the
appropriate records, together with any UCC financing statements required to be
filed in connection therewith, will create (i) valid, perfected first and second
priority lien on the fee interest in the Collateral Property, and (ii) perfected
security interests in
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and to, and perfected collateral assignments of, all personalty purported to be
covered by the Mortgage (including the Leases affecting such Collateral
Property), all in accordance with the terms thereof, in each case subject only
to any applicable Permitted Encumbrances. The Permitted Encumbrances do not
materially adversely affect the value or use of the Collateral Property, or the
ability of Borrower to repay the Loan. There are no claims for payment for work,
labor or materials affecting the Collateral Property which are or may become a
Lien prior to, or of equal priority with, any Liens created by the Loan
Documents.
5.1.7 Survey. To the best of each of Owner's and Borrower's
knowledge, the survey for the Collateral Property delivered to Lender does not
fail to reflect any material matter affecting the Collateral Property or the
title thereto which is required to be reflected thereon in accordance with the
standards for a Survey described in the definition thereof.
5.1.8 No Bankruptcy Filing. Neither Owner nor Borrower is
contemplating either the filing of a petition by it under any state or federal
bankruptcy or insolvency law or the liquidation of all or a major portion of its
property (a "Bankruptcy Proceeding"), and neither Owner nor Borrower has any
knowledge of any Person contemplating the filing of any such petition against
Owner or Borrower. In addition, neither Owner, Borrower, Owner Representative or
Borrower Representative or any principal or Affiliate of Owner, Borrower, Owner
Representative or Borrower Representative has been a party to, or the subject,
of a Bankruptcy Proceeding for the past ten (10) years.
5.1.9 Full and Accurate Disclosure. No statement of fact made by
Owner or Borrower in any Loan Document contains any untrue statement of a
material fact or omits to state any material fact necessary to make statements
contained therein not misleading. There is no material fact presently known to
Owner or Borrower that has not been disclosed to Lender which adversely affects,
or, as far as Owner or Borrower can foresee, might adversely affect, the
Collateral Property or the business, operations or condition (financial or
otherwise) of Owner or Borrower.
5.1.10 No Plan Assets. Neither Owner nor Borrower is an "employee
benefit plan," as defined in Section 3(3) of ERISA, subject to Title I of ERISA,
and none of the assets of Owner or Borrower constitute or will constitute "plan
assets" of one or more such plans within the meaning of 29 C.F.R. Section
2510.3-101. In addition, (a) Neither Owner nor Borrower is a "governmental plan"
within the meaning of Section 3(32) of ERISA and (b) transactions by or with
Owner or Borrower are not subject to state statutes regulating investment of,
and fiduciary obligations with respect to, governmental plans similar to the
provisions of Section 406 of ERISA or Section 4975 of the Code currently in
effect, which prohibit or otherwise restrict the transactions contemplated by
this Loan Agreement.
5.1.11 Compliance. Each of Owner and Borrower and the Collateral
Property and the use thereof comply in all material respects with all applicable
Legal Requirements. Neither Owner nor Borrower is in default or violation of any
order, writ, injunction, decree or demand of any Governmental Authority, the
violation of which might materially adversely affect the condition (financial or
otherwise) or business of Owner or Borrower. There has not been and shall never
be committed by Owner or Borrower or any other Person in occupancy of or
involved with the operation or use of the Collateral Property any act or
omission affording any
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Governmental Authority the right of forfeiture as against the Collateral
Property or any part thereof or any monies paid in performance of any of Owner's
or Borrower's obligations under any Loan Document.
5.1.12 Contracts. As of the date hereof, there are no material
service, maintenance or repair contracts affecting the Collateral Property other
than those identified on Schedule 4. All information set forth in Schedule 4 is
true, accurate and complete in all material respects as of the date hereof.
Except as disclosed on Schedule 4, there are no material service, maintenance or
repair contracts that are not terminable on one month's notice or less without
cause and without penalty or premium. All service, maintenance or repair
contracts affecting the Collateral Property have been entered into at
arms-length in the ordinary course of Owner's business and provide for the
payment of fees in amounts and upon terms comparable to existing market rates.
5.1.13 Financial Information. All financial data, including the
information required pursuant to Section 2.2.6 hereof and any statements of cash
flow and income and operating expense, that have been delivered to Lender in
respect of the Collateral Property (i) are true, complete and correct in all
material respects, (ii) accurately represent the financial condition of the
Collateral Property as of the date of such reports, and (iii) to the extent
prepared by an independent certified public accounting firm, have been prepared
in accordance with GAAP consistently applied throughout the periods covered,
except as disclosed therein. Neither Owner nor Borrower has any contingent
liabilities, liabilities for taxes, unusual forward or long-term commitments or
unrealized or anticipated losses from any unfavorable commitments that would
have a material adverse affect on the financial condition of Owner or Borrower
or on the Collateral Property or the operation thereof as a retail shopping
center, except as referred to or reflected in said financial statements. Since
the date of such financial statements, there has been no materially adverse
change in the financial condition, operations or business of Owner or Borrower
from that set forth in said financial statements.
5.1.14 Condemnation. No Condemnation or other proceeding has been
commenced or, to Owner's or Borrower's best knowledge, is contemplated with
respect to all or part of any Collateral Property or for the relocation of
roadways providing access to the Collateral Property.
5.1.15 Federal Reserve Regulations. No part of the proceeds of the
Loan will be used for the purpose of purchasing or acquiring any "margin stock"
within the meaning of Regulation U of the Board of Governors of the Federal
Reserve System or for any other purpose that would be inconsistent with such
Regulation U or any other regulation of such Board of Governors, or for any
purpose prohibited by Legal Requirements or any Loan Document.
5.1.16 Utilities and Public Access. The Collateral Property has
rights of access to public ways and is served by water, sewer, sanitary sewer
and storm drain facilities adequate to service the Collateral Property for its
intended use. All public utilities necessary or convenient to the full use and
enjoyment of the Collateral Property are located either in the public
right-of-way abutting the Collateral Property (which are connected so as to
serve the Collateral Property without passing over other property) or in
recorded easements serving such Collateral Property and such easements are set
forth in and insured by the Title Insurance Policies. All
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roads necessary for the use of the Collateral Property for its current purpose
have been completed and dedicated to public use and accepted by all Governmental
Authorities.
5.1.17 Not a Foreign Person. Neither Owner nor Borrower is a
"foreign person" within the meaning ofss. 1445(f)(3) of the Code.
5.1.18 Separate Lots. The Collateral Property is comprised of one
(1) or more parcels which constitute a separate tax lot or lots and does not
constitute a portion of any other tax lot not a part of the Collateral Property.
5.1.19 Assessments. There are no pending or proposed material
special or other assessments for public improvements or otherwise affecting the
Collateral Property, or any contemplated improvements to the Collateral Property
that may result in such special or other assessments.
5.1.20 Enforceability. The Loan Documents are not subject to, and
neither Owner nor Borrower has asserted, any right of rescission, set-off,
counterclaim or defense, including the defense of usury. No exercise of any of
the terms of the Loan Documents, or any right thereunder, will render any Loan
Document unenforceable.
5.1.21 Insurance. Borrower has obtained and has delivered to Lender
copies of all insurance policies reflecting the insurance coverages, amounts and
other requirements set forth in this Agreement. No Person, including Owner or
Borrower, has done, by act or omission, anything which would impair the coverage
of any such policy.
5.1.22 Use of Property; Licenses. The Collateral Property is used
exclusively for retail and other appurtenant and related uses. Except as
heretofore discussed in writing to Lender, all material certifications, permits,
licenses and approvals, including certificates of completion and occupancy
permits required for the legal use, occupancy and operation of the Collateral
Property (collectively, the "Licenses"), have been obtained and are in full
force and effect. Owner shall keep and maintain all licenses necessary for the
operation of the Collateral Property as a retail shopping center. The use being
made of the Collateral Property is in conformity in all material respects with,
and is permitted under, the certificate of occupancy issued for the Collateral
Property.
5.1.23 Flood Zone. Except as disclosed on a Survey delivered to
Lender, none of the Improvements on the Collateral Property is located in an
area as identified by the Federal Emergency Management Agency as an area having
special flood hazards.
5.1.24 Physical Condition. Except as otherwise disclosed in the
written physical inspection reports heretofore delivered to Lender, the
Collateral Property, including, without limitation, all buildings, improvements,
parking facilities, sidewalks, storm drainage systems, roofs, plumbing systems,
HVAC systems, fire protection systems, electrical systems, equipment, elevators,
exterior sidings and doors, landscaping, irrigation systems and all structural
components, are in good condition, order and repair in all material respects;
there exists no structural or other material defects or damages in the
Collateral Property, whether latent or otherwise, and neither Owner nor Borrower
has received notice from any insurance company or bonding company of any defects
or inadequacies in the Collateral Property, or any part
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thereof, which would adversely affect the insurability of the same or cause the
imposition of extraordinary premiums or charges thereon or of any termination or
threatened termination of any policy of insurance or bond.
5.1.25 Boundaries and Encroachments. All of the Improvements on the
Collateral Property included in determining the appraised value of the
Collateral Property lie wholly within the boundaries and building restriction
lines of the Collateral Property, and no improvement on an adjoining property
encroaches upon the Collateral Property, and no easement or other encumbrance
upon the Collateral Property encroaches upon any of the Improvements, so as to
affect the value or marketability of the Collateral Property, except those
insured against by the Title Insurance Policy.
5.1.26 Leases and Rent Roll. Borrower has delivered to Lender a
true, correct and complete rent roll for the Collateral Property ("Rent Roll"),
which includes all Leases affecting the Collateral Property (including schedules
for all executed Leases for Tenants not yet in occupancy or under which the rent
commencement date has not occurred). Except as set forth in the Rent Roll and
estoppel certificates delivered to Lender on or prior to the Closing Date for
the Collateral Property: (i) to the best of each of Owner's and Borrower's
knowledge, each Lease is in full force and effect; (ii) the Tenants under the
Leases have accepted possession of and are in occupancy of all of their
respective demised premises, have commenced the payment of rent under the
Leases, and, to the best of each of Owner's and Borrower's knowledge, there are
no offsets, claims or defenses to the enforcement thereof; (iii) to the best of
each of Owner's and Borrower's knowledge, all rents due and payable under the
Leases have been paid and no portion thereof has been paid for any period more
than thirty (30) days in advance; (iv) the rent payable under each Lease is the
amount of fixed rent set forth in the Rent Roll, and, to the best of each of
Owner's and Borrower's knowledge, there is no claim or basis for a claim by the
Tenant thereunder for an adjustment to the rent; (v) to the best of each of
Owner's and Borrower's knowledge, no Tenant has made any written claim against
the landlord under any Lease which remains outstanding; nor to the best of each
Borrower's knowledge, has Borrower or Manager received, by telephonic,
in-person, e-mail or other communication, any notice of a material default under
any Lease (vi) to the best of each of Owner's and Borrower's knowledge, there is
no present material default by the Tenant under any Lease; (vii) neither Owner
nor Borrower holds any security deposits under the Leases; (viii) Owner is the
sole owner of the entire lessor's or sublessor's interest in each Lease; (ix) to
the best of each of Owner's and Borrower's knowledge, each Lease is the valid,
binding and enforceable obligation of Owner and the applicable Tenant
thereunder; (x) to the best of each of Owner's and Borrower's knowledge, no
Person has any possessory interest in, or right to occupy, the Collateral
Property except under the terms of a Lease; and (xi) neither Owner nor Borrower
has received any written notice of default on the part of landlord under any
Lease. Notwithstanding the foregoing, the breach of any of the representations
contained in the preceding sentence shall not constitute an Event of Default
provided that (i) the relevant Lease is not a Material Lease and (ii) the facts
resulting in such breach do not, after taking into account all other facts
resulting in other breaches of the representations contained in the preceding
sentence, do not have a material adverse affect on the value, Net Operating
Income, use or operation of the Collateral Property. None of the Leases contains
any option to purchase or right of first refusal to purchase the Collateral
Property or any part thereof. Neither the Leases nor the Rents have been
assigned or pledged except to Lender, and no other Person has any interest
therein except the Tenants thereunder.
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5.1.27 Filing and Recording Taxes. All transfer taxes, deed stamps,
intangible taxes or other amounts in the nature of transfer taxes required to be
paid by any Person under applicable Legal Requirements currently in effect in
connection with the transfer of the Collateral Property to Owner have been paid.
All mortgage, mortgage recording, stamp, intangible or other similar tax
required to be paid by any Person under applicable Legal Requirements currently
in effect in connection with the execution, delivery, recordation, filing,
registration, perfection or enforcement of any of the Loan Documents, including,
without limitation, the Mortgage, has been paid, and, under current Legal
Requirements, and the Mortgage is enforceable in accordance with its terms by
Lender (or any subsequent holder thereof).
5.1.28 Investment Company Act. Neither Owner nor Borrower is (i) an
"investment company" or a company "controlled" by an "investment company,"
within the meaning of the Investment Company Act of 1940, as amended; (ii) a
"holding company" or a "subsidiary company" of a "holding company" or an
"affiliate" of either a "holding company" or a "subsidiary company" within the
meaning of the Public Utility Holding Company Act of 1935, as amended; or (iii)
subject to any other federal or state law or regulation which purports to
restrict or regulate its ability to borrow money.
5.1.29 Fraudulent Transfer. Neither Owner nor Borrower has entered
into the Loan or any Loan Document with the actual intent to hinder, delay, or
defraud any creditor, and each of Owner and Borrower has received reasonably
equivalent value in exchange for its obligations under the Loan Documents.
Giving effect to the transactions contemplated by the Loan Documents, the fair
saleable value of each of Owner's and Borrower's assets exceeds and will,
immediately following the execution and delivery of the Loan Documents, exceed
each of Owner's and Borrower's total liabilities, including subordinated,
unliquidated, disputed or contingent liabilities. The fair saleable value of
each of Owner's and Borrower's assets is and will, immediately following the
execution and delivery of the Loan Documents, be greater than each of Owner's
and Borrower's probable liabilities, including the maximum amount of its
contingent liabilities or its debts as such debts become absolute and matured.
Each of Owner's and Borrower's assets do not and, immediately following the
execution and delivery of the Loan Documents will not, constitute unreasonably
small capital to carry out its business as conducted or as proposed to be
conducted. Neither Owner nor Borrower intends to, or believes that it will,
incur debts and liabilities (including contingent liabilities and other
commitments) beyond its ability to pay such debts as they mature (taking into
account the timing and amounts to be payable on or in respect of obligations of
Owner or Borrower).
5.1.30 Ownership of Owner and Borrower. The sole managing member of
the sole general partner of Owner is its Owner Representative. The sole managing
member of Borrower is Owner. Westfield America Limited Partnership is the owner
of all of the issued and outstanding capital stock of Owner Representative, all
of which capital stock has been validly issued and fully paid and is
nonassessable. The only limited partners or other members of each of Owner and
Borrower are identified on Schedule 5 hereto. The stock of Owner Representative
and all limited partnership or membership interests in each of Owner and
Borrower are owned free and clear of all Liens, warrants, options and rights to
purchase. Neither Owner nor Borrower has an obligation to any Person to
purchase, repurchase or issue any ownership interest
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in it. Attached hereto as Schedule 5 is an organizational chart for each of
Owner and Borrower indicating the ownership interests in each of Owner, Borrower
and Owner Representative.
5.1.31 Management Agreement. The Management Agreement for the
Collateral Property is in full force and effect. There is no default, breach or
violation existing thereunder, and no event has occurred (other than payments
due but not yet delinquent) that, with the passage of time or the giving of
notice, or both, would constitute a default, breach or violation thereunder, by
either party thereto. The Management Fee and the terms and provisions of the
Management Agreement are subordinate to the Loan Documents in accordance with
the term set forth in the applicable Manager Consent and Subordination of
Management Agreement, Lender approves the terms of the Management Agreements
heretofore delivered to Lender.
5.1.32 Hazardous Substances. To the best of each of Owner's and
Borrower's knowledge after due inquiry, except as disclosed in the written
environmental reports delivered to Lender prior to the date hereof. (i) the
Collateral Property is not in violation of any Legal Requirement pertaining to
or imposing liability or standards of conduct concerning environmental
regulation, contamination or clean-up, including the Comprehensive Environmental
Response, Compensation and Liability Act, the Resource Conservation and Recovery
Act, the Emergency Planning and Community Right-to-Know Act of 1986, the
Hazardous Substances Transportation Act, the Solid Waste Disposal Act, the Clean
Water Act, the Clean Air Act, the Toxic Substance Control Act, the Safe Drinking
Water Act, the Occupational Safety and Health Act, any state super-lien and
environmental clean-up statutes, any local law requiring related permits and
licenses and all amendments to and regulations in respect of the foregoing laws
(collectively, "Environmental Laws"); (ii) the Collateral Property is not
subject to any private or governmental Lien or judicial or administrative notice
or action or inquiry, investigation or claim relating to hazardous, toxic,
dangerous and/or regulated substances, wastes, materials, raw materials which
include hazardous constituents, pollutants or contaminants, including asbestos,
asbestos containing materials, petroleum, tremolite, anthlophylite, actinolite,
polychlorinated biphenyls and any other substances or materials which are
included under or regulated by Environmental Laws or which are considered by
scientific opinion to be otherwise dangerous in terms of the health, safety and
welfare of humans (collectively, "Hazardous Substances"); (iii) no Hazardous
Substances are or have been (including the period prior to the acquisition of
the Collateral Property by Owner, discharged, generated, treated, stored on,
incorporated in, or removed from the Collateral Property other than in
compliance with all Environmental Laws; (iv) except for Routine Hazardous
Substances, no Hazardous Substances are or have been (including the period prior
to the acquisition of the Collateral Property by Owner), disposed of or
transported from the Collateral Property other than in compliance with all
Environmental Laws; (v) no Hazardous Substances are present in, on or under any
nearby real property which could migrate to or otherwise affect the Collateral
Property; and (vi) no underground storage tanks exist on the Collateral
Property. There have been no environmental investigations, studies, audits,
reviews or other analyses conducted by or on behalf of Owner or Borrower which
have not been provided to Lender.
5.1.33 Name; Principal of Business. Neither Owner nor Borrower uses
or will use any trade name and has done or will do business under any name other
than its actual name set forth herein or the name of the Collateral Property.
The principal place of business of each of Owner and Borrower is its primary
address for notices as set forth in Section 11.2, and neither
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Owner nor Borrower has any other place of business (other than, as to Owner, the
Collateral Property).
5.1.34 Subordinated Debt. Neither Owner nor Borrower has any
indebtedness with respect to the Collateral Property or any excess cash flow or
any residual interest therein, whether secured or unsecured, other than
Permitted Encumbrances and the permitted indebtedness described in Section 7.8.
5.1.35 Intentionally Deleted.
5.1.36 REA. With respect to each REA: (i) the Borrower has delivered
to Lender a true and correct copy of such REA, together with all amendments and
modifications thereto, and such REA is in full force and effect and has not
otherwise been modified or amended; (ii) except as disclosed in estoppels
delivered to Lender prior to the Closing Date, neither Owner nor Borrower has
received any written claim of a default (other than a technical, non-material
default which would not entitle a party to terminate or exercise any remedies
with respect to an REA) under such REA; (iii) all sums due and payable under
such REA have been paid in full; (iv) no party thereto has commenced any action
or given or received any notice for the purpose of terminating such REA; and (v)
the Owner's interest in such REA may be encumbered by the Mortgage and is
assignable without the consent of any other party to the REA.
5.1.37 Tenant Estoppels. No modifications have been made to any of
the terms and conditions of any of the Leases that would cause any of the
statements made by each of the Tenants in the Tenant estoppel certificates
delivered to Lender prior to the date hereof to be false or misleading in any
material respect.
5.1.38 No Prior Assignment. There are no prior assignments of the
Leases or any portion of the Rents due and payable or to become due and payable
which are presently outstanding.
5.1.39 Special Purpose Entity/Separateness
(a) Until the Debt has been paid in full, each of Owner and Borrower
hereby represents, warrants and covenants that each of Owner and Borrower is,
shall be and shall continue to be a Special Purpose Entity.
(b) The representations, warranties and covenants set forth in
Section 5.1.39(a) shall survive for so long as any portion of the Debt remains
payable to Lender under this Agreement, the Note or any other Loan Document.
(c) All of the assumptions made in the Insolvency Opinion,
including, but not limited to, any exhibits attached thereto, are true and
correct in all respects and any assumptions made in any subsequent
non-consolidation opinion delivered in connection with the Loan Documents or a
Transfer of the Collateral Property (an "Additional Insolvency Opinion"),
including, but not limited to, any exhibits attached thereto, will have been and
shall at all times be true and correct in all respects. Each of Owner and
Borrower has complied and will comply with all of the assumptions made with
respect
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to it in the Insolvency Opinion. Each of Owner and Borrower will have complied
and will comply with all of the assumptions made with respect to it in any
Additional Insolvency Opinion. Each entity other than Owner and Borrower with
respect to which an assumption shall be made in any Additional Insolvency
Opinion will have complied and will comply with all of the assumptions made with
respect to it in any Additional Insolvency Opinion.
5.1.40 Illegal Activity. No portion of the Collateral Property has
been or will be purchased with proceeds of any illegal activity.
5.2 Survival of Representations and Covenants. All of the representations
and warranties in Section 5.1 and elsewhere in the Loan Documents (i) shall
survive for so long as any portion of the Debt remains owing to Lender and (ii)
shall be deemed to have been relied upon by Lender notwithstanding any
investigation heretofore or hereafter made by Lender or on its behalf. The
representations, warranties and covenants set forth in Section 5.1.39 and 6.10
shall not be subject to the exculpation provisions of Section 11.1.
VI AFFIRMATIVE COVENANTS
From the date hereof and until payment and performance in full of all
obligations of Owner and Borrower under the Loan Documents or the earlier
release of the Lien of the Mortgage (and all related obligations) in accordance
with the terms of this Agreement and the other Loan Documents, each of Owner and
Borrower hereby covenant and agree with Lender that:
6.1 Existence. Each of Owner and Borrower shall (i) do or cause to be done
all things necessary to preserve, renew and keep in full force and effect its
existence, rights, and franchises, (ii) continue to engage in the business
presently conducted by it, (iii) obtain and maintain all Licenses applicable to
it or the Collateral Property, and (iv) qualify to do business and remain in
good standing under the laws of each jurisdiction, in each case as and to the
extent required for the ownership, maintenance, management and operation of the
Collateral Property.
6.2 Taxes and Other Charges. Each of Owner and Borrower shall pay all
Taxes and Other Charges applicable to it and the Collateral Property as the same
become due and payable, and deliver to Lender receipts for payment or other
evidence satisfactory to Lender that such Taxes and Other Charges have been so
paid no later than thirty (30) days before they would be delinquent if not paid
(provided, however, that neither Owner nor Borrower need furnish such receipts
for payment of Taxes paid by Lender pursuant to Section 4.3). Each of Owner and
Borrower shall suffer and shall promptly cause to be paid and discharged any
Lien against the Collateral Property other than Permitted Encumbrances, and
shall promptly pay for all utility services provided to the Collateral Property.
After prior notice to Lender, Owner or Borrower, at its own expense, may contest
by appropriate legal proceeding, promptly initiated and conducted in good faith
and with due diligence, the amount or validity or application of any Taxes or
Other Charges, provided that (i) no Event of Default has occurred and remains
uncured, (ii) such proceeding shall suspend the collection of such Taxes or
Other Charges, or the Taxes or Other Charges shall have been paid, (iii) such
proceeding shall be permitted under and be conducted in accordance with the
provisions of any other instrument to which Owner and/or Borrower is subject and
shall not constitute a default thereunder, (iv) no part of or interest in the
Collateral Property will be in danger of being sold, forfeited, terminated,
canceled or lost, (v) Owner and/or
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Borrower shall have furnished such security as may be required in the
proceeding, or as may be requested by Lender, to insure the payment of any such
Taxes or Other Charges, together with all interest and penalties thereon, which
shall not be less than 125% of the unpaid Taxes and Other Charges being
contested (and in the case of any Taxes being contested, any sums in the Tax and
Insurance Escrow fund dedicated to payment of such contested Taxes shall count
toward such 125%), and (vi) Owner and/or Borrower shall promptly upon final
determination thereof pay the amount of such Taxes or Other Charges, together
with all costs, interest and penalties. Lender may pay over any such security or
part thereof held by Lender to the claimant entitled thereto at any time when,
in the judgment of Lender, the entitlement of such claimant is established.
6.3 Repairs; Maintenance and Compliance; Alterations; Required Repairs.
6.3.1 Repairs and Maintenance. Each of Owner and Borrower shall at
all times maintain, preserve and protect all franchises and trade names, and
Owner shall cause the Collateral Property to be maintained in a good and safe
condition and repair and shall not, without Lender's prior written consent,
remove or demolish the Improvements or Equipment (except for removal of
Equipment being replaced with Equipment of the same or greater value and
utility, and demolition necessary to perform alterations permitted under Section
6.3.3).
6.3.2 Legal Compliance. Each of Owner and Borrower shall promptly
comply in all material respects with all Legal Requirements applicable to itself
or the Collateral Property and cure properly any violation of a Legal
Requirement within thirty (30) days after Owner or Borrower, as applicable,
receives notice of such violation. Owner shall promptly repair, replace or
rebuild any part of the Collateral Property that becomes damaged, worn or
dilapidated and shall complete and pay for any Improvements constituting part of
the Collateral Property at any time in the process of construction or repair.
Notwithstanding the foregoing, Owner may defer compliance with a Legal
Requirement pending Owner's contest thereof; provided that (1) Owner is
permitted by the applicable Legal Requirement to delay compliance therewith
pending such proceedings, (2) neither the Collateral Property nor any part
thereof or interest therein will be sold, forfeited or lost if Owner fails to
promptly comply with the Legal Requirement being contested, and if Owner fails
to prevail in contest, Owner would thereafter have the opportunity to comply
with such Legal Requirement, (3) Lender would not, by virtue of such permitted
contest, be exposed to any risk of any civil liability for which Owner has not
furnished additional security as provided in clause (4) below, or to any risk of
criminal liability, and neither the Collateral Property nor any interest therein
would be subject to the imposition of any Lien for which Owner has not furnished
additional security as provided in clause (4) below, as a result of the failure
to comply with such Legal Requirement and (4) if requested by Lender at any
time, Owner shall have furnished to Lender additional security in respect of the
Legal Requirement being contested and the loss or damage that may result from
Owner's failure to prevail in such contest in such amount as may be reasonably
requested by Lender but in no event less than one hundred twenty-five percent
(125%) of the cost of complying such Legal Requirement and any loss or damage
that may result from Owner's failure to prevail in such contest.
6.3.3 Alterations. Owner may, without Lender's consent, perform
alterations to the Improvements and Equipment at the Collateral Property which
do not constitute a Material Alteration and which do not adversely affect
Owner's financial condition or the value or net operating income of the
Collateral Property. Owner shall not perform any Material Alteration
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the cost of which is reasonably estimated to exceed five percent (5%) of the
Loan per calendar year for the Collateral Property or which is likely to result
in a decrease of Net Operating Income of the Collateral Property by 2.5% or more
for a period of thirty (30) days or longer, without Lender's prior written
consent, which consent shall not be unreasonably withheld or delayed. Lender
may, as a condition to giving its consent to a Material Alteration, require that
the Borrower deliver to Lender as security for payment of the cost of such
Material Alteration and as additional security for Borrower's payment of the
Debt any of the following: (1) cash, (2) U.S. Treasury securities, (3) other
securities having a rating acceptable to Lender, (4) a Rating Comfort Letter, or
(5) an irrevocable Letter of Credit (payable on sight draft only) issued by an
Eligible Institution. Such security shall be in an amount equal to the cost of
the Material Alteration as reasonably estimated by Lender. Upon the occurrence
of an Event of Default, Lender may apply such security to payment of the Debt.
If the security posted is other than cash, upon substantial completion of the
Material Alteration and submission to Lender of evidence satisfactory to Lender
that (i) the Material Alteration was constructed in accordance with applicable
Legal Requirements and substantially in accordance with plans and specifications
approved by Lender (which approval shall not be unreasonably withheld or
delayed), (ii) all contractors, subcontractors, materialmen and professionals
who provided work, materials or services in connection with the Material
Alteration have been paid in full and have delivered unconditional releases of
lien and (iii) all material Licenses necessary for the use, operation and
occupancy of the Material Alteration (other than those which depend on the
performance of tenant improvement work) have been issued, Lender shall, provided
no Event of Default then exists, return the security (or the unapplied portion
thereof) to the Borrower. At the Borrower's request, Lender shall, provided no
Event of Default then exists, return one-half of the security to Borrower when
Lender has determined, in its sole discretion, that seventy-five percent (75%)
of the Material Alteration has been completed and paid for and that the
remaining security is sufficient to ensure payment in full for all work,
services and materials necessary to complete the Material Alteration as
contemplated in clauses (i), (ii) and (iii) of the preceding sentence. If the
security posted is cash, Lender shall disburse such cash in accordance with the
same procedures as are applicable to disbursement of Proceeds or an Award under
Section 8.4.3. The Borrower shall reimburse Lender upon demand for all
out-of-pocket costs and expenses (including the reasonable fees of all
professionals) incurred by Lender in reviewing plans and specifications or in
making any determinations necessary to implement the provisions of this Section
6.3.3.
6.3.4 New Construction. Borrower hereby directs Lender to disburse
directly to UBS, in accordance with wiring instructions separately delivered to
Lender by Borrower, a portion of the Principal in the amount of $15,000,000.00
(the "New Construction Proceeds"). In connection with the performance of the New
Construction and the payment of the costs thereof, UBS, Borrower and Owner have
entered into that certain Construction Cash Collateral Account Security, Pledge
and Assignment Agreement dated December 9, 1999 (the "Construction Cash
Collateral Agreement"), pursuant to which UBS shall disburse the New
Construction Proceeds to, or at the direction of, Borrower. The New Construction
Proceeds are fully disbursed Loan proceeds and Borrower is fully obligated for
the repayment of same and the payment of interest and other amounts with respect
to same as if such New Construction Proceeds were funded directly to Borrower.
6.4 Litigation. Each of Owner and Borrower shall give prompt written
notice to Lender of any litigation, governmental proceedings or claims or
investigations regarding an alleged
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actual violation of a Legal Requirement pending or threatened against either
Owner or Borrower which would, if adversely determined, materially adversely
affect Owner's or Borrower's condition (financial or otherwise) or business or
the Collateral Property.
6.5 Performance of Other Agreements. Owner shall observe and perform in
all material respects each and every term to be observed or performed by it
pursuant to the terms of any agreement or instrument affecting or pertaining to
the Collateral Property.
6.6 Notices. Each of Owner and Borrower shall promptly advise Lender of
any material adverse change in Owner's or Borrower's condition, financial or
otherwise, or of the occurrence of any Default or Event of Default of which
Owner or Borrower has knowledge. Each of Owner and Borrower shall cause to be
delivered to Lender any Securities and Exchange Commission or other public
filings, if any, of Owner, Borrower, Owner Representative, Borrower
Representative, Manager, or any Affiliate of any of the foregoing within ten
(10) Business Days of such filing.
6.7 Cooperate in Legal Proceedings. Each of Owner and Borrower shall
cooperate fully with Lender with respect to, and permit Lender, at its option,
to participate in, any proceedings before any Governmental Authority which may
in any way affect the rights of Lender under any Loan Document.
6.8 Further Assurances. Each of Owner and Borrower shall, at Borrower's
sole cost and expense, (i) furnish to Lender all then existing instruments,
documents, boundary surveys, footing or foundation surveys, certificates, plans
and specifications, appraisals, title and other insurance reports and
agreements, reasonably requested by Lender; (ii) execute and deliver to Lender
such documents, instruments, certificates, assignments and other writings, and
do such other acts necessary or desirable, to evidence, preserve and/or protect
the collateral at any time securing or intended to secure the Debt, as Lender
may reasonably require from time to time; (iii) do and execute all and such
further lawful and reasonable acts, conveyances and assurances for the better
and more effective carrying out of the intents and purposes of the Loan
Documents, as Lender shall reasonably require from time to time; and (iv) upon
Lender's request therefor given from time to time after the occurrence of any
Default or Event of Default pay for (a) reports of UCC, federal tax lien, state
tax lien judgment and pending litigation searches with respect to Owner or
Borrower and (b) searches of title to the Collateral Property, each such search
to be conducted by search firms reasonably designated by Lender in each of the
locations reasonably designated by Lender.
6.9 Financial Reporting.
6.9.1 Bookkeeping. Each of Owner and Borrower shall keep on a Fiscal
Year basis, in accordance with GAAP, proper and accurate books, records and
accounts reflecting all of the financial affairs of Owner and Borrower, as
applicable, and all items of income and expense and, as to Owner, any services,
Equipment or furnishings provided in connection with the operation of the
Collateral Property, whether such income or expense is realized by Owner,
Borrower, Manager or any Affiliate of Owner, Borrower or Manager. Lender shall
have the right from time to time during normal business hours upon reasonable
notice to examine such books, records and accounts at the office of Owner or
Borrower, as applicable, or other Person
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maintaining them, and to make such copies or extracts thereof as Lender shall
desire. After an Event of Default, Borrower shall pay any costs incurred by
Lender to examine such books, records and accounts, as Lender shall determine to
be necessary or appropriate in the protection of Lender's interest.
6.9.2 Annual Reports. Each of Owner and Borrower shall furnish to
Lender annually, (i) within forty (40) days after each Fiscal Year, unaudited
financial statements of Owner and Borrower, as applicable, and (ii) within
one-hundred twenty (120) days after each Fiscal Year, a complete copy of Owner's
and Borrower's annual financial statements audited by a "Big Five" accounting
firm or another independent certified public accountant (accompanied by an
unqualified opinion from such accounting firm or other independent certified
public accountant) reasonably acceptable to Lender, each in accordance with GAAP
and containing balance sheets and statements of profit and loss for Owner and
Borrower and, as to Owner's financial statement, the Collateral Property, in
such detail as Lender may request. Each statement of Owner (x) shall set forth
the financial condition and the income and expenses for the Collateral Property
for the immediately preceding calendar year, including statements of annual Net
Operating Income, and (y) shall be accompanied by an Officer's Certificate
certifying (1) that such statement presents fairly the financial condition of
the Collateral Property and has been prepared in accordance with GAAP, (2) a
list of Tenants, if any, occupying more than twenty percent (20%) of the
rentable space of the Collateral Property, and (3) a breakdown showing (a) the
year in which each Lease then in effect expires, (b) the percentage of rentable
space covered by such Lease, (c) the percentage of base rent with respect to
which Leases shall expire in each such year, expressed both on a per year and a
cumulative basis. Each statement of Owner and Borrower shall be accompanied by
an Officer's Certificate certifying whether there exists a Default or Event of
Default, and if so, the nature thereof, the period of time it has existed and
the action then being taken to remedy it.
6.9.3 Monthly and Quarterly Reports. Owner shall furnish to Lender
(x) within thirty (30) days after the end of each calendar month the following
items: (i) monthly and year-to-date operating statements, noting Net Operating
Income and other information necessary and sufficient under GAAP to fairly
represent the financial position and results of operation of the Collateral
Property during such calendar month, all in form reasonably satisfactory to
Lender; (ii) a statement that such Borrower has not incurred any indebtedness
other than indebtedness permitted hereunder; and (iii) occupancy rates, rent
rolls (identifying the leased premises, names of all Tenants, units leased,
monthly rental and all other charges payable under each Lease, date to which
paid, term of Lease, date of occupancy, date of expiration, material special
provisions, concessions or inducements granted to Tenants, and a year-by-year
schedule showing by percentage the rentable area of the Improvements and the
total base rent attributable to Leases expiring each year) and a delinquency
report for the Collateral Property; and (y) within forty (40) days after the end
of each calendar quarter the following items: (i) a balance sheet for such
calendar month; (ii) a comparison of the budgeted income and expenses and the
actual income and expenses for each month and year-to-date for the Collateral
Property, together with a detailed explanation of any variances of ten percent
(10%) or more between budgeted and actual amounts for such period and
year-to-date; (iii) a statement of the actual Replacement Expenses made by Owner
during each calendar quarter as of the last day of such calendar quarter; and
(iv) an aged receivables report. Each such statement shall be accompanied by an
Officer's Certificate certifying (1) that such items are true, correct,
accurate, and complete
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and fairly present the financial condition and results of the operations of
Owner and the Collateral Property in accordance with GAAP (subject to normal
year-end adjustments) and (2) whether there exists a Default or Event of
Default, and if so, the nature thereof, the period of time it has existed and
the action then being taken to remedy it. Borrower shall furnish to Lender,
within thirty (30) days after the end of each calendar month, a statement that
Borrower has not incurred any indebtedness other than indebtedness permitted
hereunder. Each such statement shall be accompanied by an Officer's Certificate
certifying whether there exists a Default or Event of Default, and if so, the
nature thereof, the period of time it has existed and the action being taken to
remedy it.
6.9.4 Other Reports. Each of Owner and Borrower shall furnish to
Lender, within ten (10) Business Days after request, such further detailed
information with respect to the operation of the Collateral Property and the
financial affairs of Owner, Borrower or Manager as may be reasonably requested
by Lender or any Applicable Rating Agency, all such information to conform to
any related requirements of the Securities and Exchange Commission.
6.9.5 Annual Budget. Upon the occurrence of a Cash Management Event
or the Anticipated Repayment Date, Borrower shall prepare and submit (or shall
cause Owner or Manager to prepare and submit) to Lender within thirty (30) days
after a Cash Management Event and by November 15 of each year during the Term
until the occurrence of a Cash Management Termination, for approval by Lender,
which approval shall not be unreasonably withheld or delayed, a proposed pro
forma budget for the Collateral Property for the succeeding Fiscal Year (an
"Annual Budget"), and, promptly after preparation thereof, any revisions to such
Annual Budget. Lender's failure to approve or disapprove any Annual Budget or
revision within thirty (30) days after Lender's receipt thereof shall be deemed
to constitute Lender's approval thereof. The Annual Budget shall consist of (i)
an operating expense budget (the "Operating Budget") showing, on a
month-by-month basis, in reasonable detail, each line item of Owner's
anticipated Operating Income and Operating Expenses (on a cash and accrual
basis), including amounts required to establish, maintain and/or increase the
Funds, and (ii) a Replacement Expense budget (the "Replacement Budget") showing,
on a month-by-month basis, in reasonable detail, each line item of anticipated
Replacement Expenses.
6.9.6 Delivery of Financial Information. After notice to Owner and
Borrower of a Secondary Market Transaction, Owner and Borrower shall,
concurrently with any delivery to Lender, deliver copies of all financial
information provided in this Article VI to the Applicable Rating Agencies, the
Servicer, any trustee or any other party reasonably requested by Lender.
6.10 Environmental Matters.
6.10.1 Hazardous Substances. So long as Owner owns or is in
possession of the Collateral Property, Borrower shall cause Owner to (i) keep
the Collateral Property free from Hazardous Substances (other than Routine
Hazardous Substances) and in compliance with all Environmental Laws, (ii)
promptly notify Lender if Owner shall become aware that (A) any Hazardous
Substance (other than Routine Hazardous Substances) is on or immediately
adjacent to the Collateral Property, (B) the Collateral Property is in direct or
indirect violation of any Environmental Laws or (C) any condition on or near the
Collateral Property shall pose a threat to the health, safety or welfare of
humans, (iii) shall remove such Hazardous Substances and/or
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cure such violations and/or remove such threats, as applicable, as required by
law, promptly after Owner or Borrower becomes aware of same and is required to
do so by a Governmental Authority, at Owner's and Borrower's sole expense and
(iv) shall take all actions described in the environmental report delivered to
Lender in connection with the Loan as being necessary to comply with all
applicable laws. Nothing herein shall prevent Owner or Borrower from recovering
such expenses from any other party that may be liable for such removal or cure.
6.10.2 Environmental Monitoring. (a) Each of Owner and Borrower
shall give prompt written notice to Lender of (i) any proceeding or inquiry by
any party (including any Governmental Authority) with respect to the presence of
any Hazardous Substance on, under, from or about the Collateral Property, (ii)
all claims made or threatened in writing by any third party (including any
Governmental Authority) against Owner, Borrower or the Collateral Property or
any party occupying the Collateral Property relating to any loss or injury
resulting from any Hazardous Substance, and (iii) Owner's or Borrower's
discovery of any occurrence or condition on any real property adjoining or in
the vicinity of the Collateral Property that could cause the Collateral Property
to be subject to any investigation or cleanup pursuant to any Environmental Law.
Owner and Borrower shall permit Lender to join and participate in, as a party if
it so elects, any legal proceedings or other actions initiated with respect to
the Collateral Property in connection with any Environmental Law or Hazardous
Substance, and Owner and Borrower shall pay all reasonable attorneys' fees and
disbursements incurred by Lender in connection therewith.
(b) Upon Lender's request, at any time and from time to time,
Borrower shall cause Owner to provide an inspection or audit of the Collateral
Property prepared by a licensed hydrogeologist, licensed environmental engineer
or qualified environmental consulting firm approved by Lender assessing the
presence or absence of Hazardous Substances on, in or near the Collateral
Property. The cost and expense of such audit or inspection shall be paid by
Owner and Borrower if Lender, in its good faith judgment, determines that
reasonable cause exists for the performance of an environmental inspection or
audit of the Collateral Property. If Borrower fails to cause Owner to order any
such inspection or audit within thirty (30) days after such request, Lender may
order same, and Owner hereby grants to Lender and its employees and agents
access to the Collateral Property and a license to undertake such inspection or
audit. The cost of such inspection or audit shall, to the extent required to be
paid by Owner and Borrower pursuant to this paragraph, be paid by Owner and
Borrower upon demand and if not paid, shall be added to the Debt and shall bear
interest thereafter at the Default Rate until paid.
(c) If any environmental site assessment report prepared in
connection with such inspection or audit recommends that an operations and
maintenance plan be implemented for any Hazardous Substance, whether such
Hazardous Substance existed prior to the ownership by Owner of the Collateral
Property, or presently exists or is reasonably suspected of existing, Owner
shall cause such operations and maintenance plan to be prepared and implemented
at its expense upon request of Lender. If a licensed hydrogeologist, licensed
environmental engineer or other qualified environmental consulting firm engaged
by Lender ("Lender's Consultant") determines that any investigation, site
monitoring, containment, cleanup, removal, restoration or other work of any kind
is required to cure a violation of an applicable Environmental Law or to comply
with an order or directive of any court or governmental agency ("Remedial
Work"), Borrower shall cause Owner to commence and thereafter diligently
prosecute to completion all
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such Remedial Work within thirty (30) days after written demand by Lender for
performance thereof (or such shorter period of time as may be required under
applicable law). All Remedial Work shall be performed by contractors reasonably
approved in advance by Lender, and under the supervision of a consulting
engineer reasonably approved by Lender. All costs of such Remedial Work shall be
paid by Owner and Borrower, including Lender's reasonable attorneys' fees and
disbursements incurred in connection with the monitoring or review of such
Remedial Work. If Borrower does not cause Owner to timely commence and
diligently prosecute to completion the Remedial Work, Lender may (but shall not
be obligated to) cause such Remedial Work to be performed. All costs and
expenses (including reasonable attorneys' fees and disbursements) relating to or
incurred by Lender in connection with monitoring, reviewing or performing any
Remedial Work in accordance herewith shall be paid by Owner and Borrower upon
demand from Lender and if not, shall be added to the Debt and shall bear
interest thereafter at the Default Rate until paid. Notwithstanding the
foregoing, Owner shall not be required to commence such Remedial Work within the
above specified time period: (x) if prevented from doing so by any Governmental
Authority, (y) if commencing such Remedial Work within such time period would
result in Owner or such Remedial Work violating any Environmental Law, or (z) if
Owner, at its expense and after prior written notice to Lender, is contesting by
appropriate legal, administrative or other proceedings, conducted in good faith
and with due diligence, the need to perform Remedial Work. Owner shall have the
right to contest the need to perform such Remedial Work; provided that (1) Owner
is permitted by the applicable Environmental Laws to delay performance of the
Remedial Work pending such proceedings, (2) neither the Collateral Property nor
any part thereof or interest therein will be sold, forfeited or lost if Owner
fails to promptly perform the Remedial Work being contested, and if Owner fails
to prevail in contest, Owner would thereafter have the opportunity to perform
such Remedial Work, (3) Lender would not, by virtue of such permitted contest,
be exposed to any risk of any civil liability for which Owner has not furnished
additional security as provided in clause (4) below, or to any risk of criminal
liability, and neither the Collateral Property nor any interest therein would be
subject to the imposition of any Lien for which Owner has not furnished
additional security as provided in clause (4) below, as a result of the failure
to perform such Remedial Work and (4) if requested by Lender at any time, Owner
shall have furnished to Lender additional security in respect of the Remedial
Work being contested and the loss or damage that may result from Owner's failure
to prevail in such contest in such amount as may be reasonably requested by
Lender but in no event less than one hundred twenty-five percent (125%) of the
cost of such Remedial Work and any loss or damage that may result from Owner's
failure to prevail in such contest.
(d) Owner shall not install or permit to be installed on the
Collateral Property any underground storage tank without Lender's prior written
consent; provided, however, that (i) Owner may permit the Tenant under any
"anchor," "big box" or TBA (tires, batteries and accessories) Lease to install
an underground storage tank provided that (x) such Tenant has the right to do so
under its Lease and (y) such installation and the maintenance and repair of such
tank is performed in accordance with all applicable Legal Requirements and (ii)
Owner may install an underground storage tank if it reasonably determines that
an above ground storage tank is not reasonably feasible, provided that Owner
complies with all of the provisions of the preceding clause (y) in connection
with such underground storage tank.
(e) Intentionally Deleted.
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(g) Borrower shall cause Owner to continue to perform all remedial
actions required to be undertaken pursuant to any operations and maintenance
plans with regard to the Collateral Property, if any.
6.10.3 Title to the Property. Owner and Borrower will warrant and
defend (a) the title to the Collateral Property and every part thereof, subject
only to Liens permitted hereunder (including Permitted Encumbrances) and (b) the
validity and priority of the Liens of the Mortgage and the Assignment of Leases
on the Collateral Property, subject only to Liens permitted hereunder (including
Permitted Encumbrances), in each case against the claims of all Persons
whomsoever. Owner and Borrower shall reimburse Lender for any losses, costs,
damages or expenses (including reasonable attorneys' fees and court costs)
incurred by Lender if an interest in the Collateral Property, other than as
permitted hereunder, is claimed by another Person.
6.10.4 Easements; Dedications. Without the consent of Lender,
Borrower shall have the right from time to time to release property, grant
easements, or dedicate property in connection with lot line adjustments, utility
or road requirements or other similar items, provided that any such release,
easement or dedication will not have a material adverse effect on the value, use
or operation of the Collateral Property and the Collateral Property will remain
in compliance with all Requirements of Law.
6.11 Leases.
6.11.1 Form of Lease. All Leases other than Material Leases shall be
written on the standard forms of lease which have been approved by Lender. In
negotiating Leases, changes may be made to the standard form of lease provided
that (i) such changes are commercially reasonable, and (ii) no changes may be
made to the following provisions in Owner's standard form of lease without the
prior written consent of Lender: provisions relating to subordination,
attornment, estoppels, mortgagee's right to notice and opportunity to cure
landlord's defaults, and mortgagee's rights with respect to lease amendments and
prepayment of rents. In addition, all renewals of Leases and all proposed leases
shall provide for rental rates comparable to existing local market rates and
shall be arms length transactions. All Leases entered into after the date hereof
shall provide for (x) subordination to the Mortgage and, at Lender's election,
attornment to Lender or any purchaser at a sale by foreclosure or power of sale,
and (y) the Lender's unilateral right to subordinate the Mortgage to the Leases.
No Lease entered into after the date hereof will contain any option to purchase,
any right of first refusal to purchase, any right to terminate (except in the
event of the destruction of substantially all of the Collateral Property), any
non-disturbance or similar agreement or any requirement that Owner rebuild the
Collateral Property (except as provided in the form of Lease that has been
approved by Lender); provided, however, that "small shop" leases entered into
after the date hereof and covering not more than fifteen percent (15%) of the
gross leaseable area of the Collateral Property may contain so called "kick-out"
clauses permitting either landlord or the Tenant to terminate the Lease if the
specified sales revenue is not attained. Upon request, Owner shall furnish
Lender with executed copies of all Leases affecting the Collateral Property then
in effect.
6.11.2 New and Renewal Leases. All Leases executed after the date
hereof, and all amendments, modifications, terminations or surrenders of
existing Leases, shall (a) be
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undertaken in a manner consistent with the standing leasing practices of Owner
and the Manager, (b) be the product of an arms-length transaction, and (c) not
result in a material adverse effect on the Collateral Property taken as a whole.
Upon the occurrence of a Cash Management Event and during the continuance
thereof , any Leases written thereafter for more than 7,500 square feet, and any
amendments, modifications, terminations or surrenders of existing Leases for
more than 7,500 square feet, shall be approved by Lender, which approval shall
not be unreasonably withheld, conditioned or delayed.
6.11.3 Leasing Covenants. Borrower shall cause Owner to (i) observe
and perform the material obligations imposed upon the lessor under the Leases;
(ii) enforce in a commercially reasonable manner the terms, covenants and
conditions contained in the Leases upon the part of the lessee thereunder to be
observed or performed; (iii) not collect any of the rents more than one (1)
month in advance (other than security deposits) except as approved by Lender or
as provided in Leases in existence as of the date hereof; (iv) not execute any
other assignment of lessor's interest in the Leases or the Rents (except as
contemplated by the Loan Documents); (v) not alter, modify or change the terms
of the Leases in a manner inconsistent within the provisions of the Loan
Documents; (vi) promptly send copies to Lender of all notices of default Owner
shall give or receive with respect to any Lease demising 20,000 or more square
feet of gross leaseable area; and (vii) execute and deliver at the request of
Lender all such further assurances, confirmations and assignments in connection
with the Leases as Lender shall from time to time reasonably require.
6.11.4 Non-disturbance Agreements. At Borrower's request, Lender
shall enter into a subordination, non-disturbance and attornment agreement as to
any Lease permitted under the Loan Documents. Such agreement shall be in the
form attached hereto as Exhibit B, with such changes thereto as may be
reasonably acceptable to Lender.
6.11.5 Reciprocal Easement Agreements. Borrower shall cause Owner to
not enter into, terminate or modify any REA without Lender's consent, which
consent shall not be unreasonably withheld or delayed. Lender shall subordinate
the lien of the Mortgage to any REA Amendment consented to by Lender.
6.11.6 Notice to Tenants. Promptly after the date hereof (but in no
event later than the date on which Owner sends out bills for Rents due in
January, 2000), Borrower shall cause Owner to deliver a notice in the form of
Exhibit A attached hereto to each existing Tenant at the Collateral Property
directing them to remit their rent checks directly to the Agent and shall also
deliver such a notice to each future tenant at the Collateral Property.
6.12 Estoppel Statement. After request by Lender, Borrower shall within
ten (10) days furnish Lender with a statement, duly acknowledged and certified,
setting forth (i) the unpaid Principal, (ii) the Interest Rate, (iii) the date
installments of interest and/or Principal were last paid, (iv) any offsets or
defenses to the payment of the Debt, (v) that the Loan Documents are valid,
legal and binding obligations and have not been modified or if modified, giving
particulars of such modification and (vi) such other information concerning the
Loan as Lender may request. After request by Lender (but no more frequently than
once in any twelve (12) month period), Borrower shall cause Owner, within thirty
(30) days, to request Tenant estoppel certificates from each Tenant at the
Collateral Property in form and substance reasonably
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satisfactory to Lender, and thereafter use commercially reasonable efforts to
obtain such estoppel certificates and deliver them to Lender.
6.13 Property Management.
6.13.1 Management Agreement. Borrower shall cause Owner to (i) cause
the Collateral Property to be managed pursuant to the Management Agreement; (ii)
promptly perform and observe all of the covenants required to be performed and
observed by it under the Management Agreement and do all things necessary to
preserve and to keep unimpaired its material rights thereunder, (iii) promptly
notify Lender of any default under the Management Agreement of which it is
aware; (iv) promptly deliver to Lender a copy of any notice of default or other
material notice received by Owner under the Management Agreement; and (v)
promptly enforce the performance and observance of all of the covenants required
to be performed and observed by Manager under the Management Agreement.
6.13.2 Termination of Manager. If a Cash Management Event shall
exist, at the request of Lender, Borrower shall cause Owner to hire a property
management firm designated by Lender to thereafter serve as a property
management consultant (the "Management Consultant") for Owner and the Collateral
Property. Owner's failure to retain such property management firm within thirty
(30) days after Lender designates such firm shall constitute an immediate Event
of Default. Owner shall continue to retain the Management Consultant until a
Cash Management Termination occurs. The Management Consultant shall oversee and
approve and fully participate in all actions and decisions of the Manager at the
Collateral Property, including the incurring of any expenses, the retention of
any broker, the negotiation and execution of any leases or lease "term sheets",
decisions as to tenants and "tenant mix" and repairs, alterations and
improvements. Owner shall cause Manager to cooperate with the Management
Consultant to enable the Management Consultant to perform its responsibilities
as described above and in the agreement between Owner and the Management
Consultant. All fees payable to the Management Consultant shall be an Approved
Operating Expense.
6.13.3 Manager's Subordination. Owner shall cause Manager to enter
into a Manager Consent and Subordination of Management Agreement (the "Manager
Consent and Subordination Agreement") in the form of Exhibit C-1 hereto;
provided, however, that if such Manager is wholly owned, directly or indirectly
by Westfield Holdings Limited, such Manager may enter into a Manager Consent and
Subordination of Management Agreement in the form of Exhibit C-2 hereto.
6.14 Special Purpose Entity. Each of Owner and Borrower is and shall
continue to be a Special Purpose Entity.
6.15 Expenses. Borrower shall reimburse Lender upon receipt of notice for
all reasonable out-of-pocket costs and expenses (including reasonable attorneys'
fees and disbursements) incurred by Lender in connection with the Loan,
including (i) the preparation, negotiation, execution and delivery of the Loan
Documents and the consummation of the transaction contemplated thereby and all
the costs of furnishing all opinions by counsel for Owner and Borrower; (ii) all
costs, fees and expenses (including the fees of any Rating Agencies, trustee or
Servicer) incurred in connection with any release of the Collateral Property
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(but excluding the fees payable to the Rating Agencies in connection with the
initial issuance of Securities) or any Transfer of Owner's Collateral Property;
(iii) Owner's, Borrower's and Lender's ongoing performance under and compliance
with the Loan Documents, including confirming compliance with environmental and
insurance requirements; (iv) the negotiation, preparation, execution, delivery
and administration of any consents, amendments, waivers or other modifications
of or under any Loan Document and any other documents or matters requested by
Lender, (v) filing and recording of any Loan Documents; (vi) title insurance,
surveys, inspections and appraisals; (vii) the creation, perfection or
protection of Lender's Liens in the Collateral Property, the Cash Management
Accounts and the Funds (including fees and expenses for title and lien searches,
intangibles taxes, personal property taxes, mortgage recording taxes, due
diligence expenses, travel expenses, accounting firm fees, costs of appraisals,
environmental reports and Lender's Consultant, surveys and engineering reports);
(viii) enforcing or preserving any rights in response to third party claims or
the prosecuting or defending of any action or proceeding or other litigation, in
each case against under or affecting Owner, Borrower, the Loan Documents, the
Collateral Property, or any other security given for the Loan; and (ix)
enforcing any obligations of or collecting any payments due from Owner or
Borrower under any Loan Document or with respect to the Collateral Property or
in connection with any refinancing or restructuring of the Loan in the nature of
a "work-out", or any insolvency or bankruptcy proceedings. Any costs and
expenses due and payable to Lender hereunder which are not paid by any Borrower
within ten (10) days after demand may be paid from any amounts in the Cash
Management Accounts, with notice thereof to Borrower. The obligations and
liabilities of Borrower under this Section 6.15 shall survive the Term and the
exercise by Lender of any of its rights or remedies under the Loan Documents,
including the acquisition of the Collateral Property by foreclosure or a
conveyance in lieu of foreclosure.
6.16 Indemnity. Each of Owner and Borrower shall indemnify and hold
harmless Lender and each of its Affiliates and their respective successors and
assigns (including their respective directors, officers, participants,
employees, professionals and agents and each other Person, if any, who Controls
Lender, its Affiliates or any of the foregoing) (each, an "Indemnified Party")
from and against any and all liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, claims, costs, expenses and disbursements
of any kind or nature whatsoever (including the reasonable fees and
disbursements of counsel for an Indemnified Party in connection with any
investigative, administrative or judicial proceeding commenced or threatened,
whether or not Lender shall be designated a party thereto), that may be imposed
on, incurred by, or asserted against any Indemnified Party (collectively, the
"Indemnified Liabilities") in any manner, relating to or arising out of or by
reason of the Loan, including: (i) any breach by Owner or Borrower of any of
their respective obligations under, or any misrepresentation by Owner or
Borrower contained in, any Loan Document; (ii) the use or intended use of the
proceeds of the Loan; (iii) any information provided by or on behalf of Owner or
Borrower, or contained in any documentation approved by Owner or Borrower; (iv)
ownership of the Mortgage, the Collateral Property or any interest therein, or
receipt of any Rents; (v) any accident, injury to or death of persons or loss of
or damage to property occurring in, on or about the Collateral Property or on
the adjoining sidewalks, curbs, adjacent property or adjacent parking areas,
streets or ways; (vi) any use, non-use or condition in, on or about the
Collateral Property or on adjoining sidewalks, curbs, adjacent property or
adjacent parking areas, streets or ways; (vii) performance of any labor or
services or the furnishing of any materials or other property in respect of the
Collateral Property; (viii) the presence, disposal, escape, seepage,
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leakage, spillage, discharge, emission, release, or threatened release of any
Hazardous Substance on, from or affecting the Collateral Property; (ix) any
personal injury (including wrongful death) or property damage (real or personal)
arising out of or related to such Hazardous Substance; (x) any lawsuit brought
or threatened, settlement reached, or government order relating to such
Hazardous Substance; (xi) any violation of the Environmental Laws which is based
upon or in any way related to such Hazardous Substance, including, without
limitation, the costs and expenses of any Remedial Work, attorney and consultant
fees and disbursements, investigation and laboratory fees, court costs, and
litigation expenses; (xii) any failure of the Collateral Property to comply with
any Legal Requirement; (xiii) any claim by brokers, finders or similar persons
claiming to be entitled to a commission in connection with any Lease or other
transaction involving the Collateral Property or any part thereof, or any
liability asserted against Lender with respect thereto; and (xiv) the claims of
any lessee of any portion of the Collateral Property or any person acting
through or under any lessee or otherwise arising under or as a consequence of
any Lease; neither Owner nor Borrower shall have any obligation to any
Indemnified Party hereunder to the extent that it is finally judicially
determined that such Indemnified Liabilities arise from the gross negligence,
illegal acts, fraud or willful misconduct of such Indemnified Party. If any
Indemnified Party becomes involved in any action, proceeding or investigation in
connection with any transaction or matter referred to or contemplated in this
Agreement, Owner and Borrower shall periodically reimburse any Indemnified Party
upon demand therefor in an amount equal to its reasonable legal and other
expenses (including the costs of any investigation and preparation) incurred in
connection therewith. To the extent that the undertaking to indemnify and hold
harmless set forth in the preceding sentence may be unenforceable because it
violates any law or public policy, Borrowers 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 any
Indemnified Party. Any amounts payable to any Indemnified Party by reason of the
application of this paragraph shall become immediately due and payable and shall
bear interest at the Default Rate from the date loss or damage is sustained by
any Indemnified Party until paid. The obligations and liabilities of Owner and
Borrower under this Section 6.16 shall survive the Term and the exercise by
Lender of any of its rights or remedies under the Loan Documents, including the
acquisition of the Collateral Property by foreclosure or a conveyance in lieu of
foreclosure.
6.17 Third Party Reports. Within thirty (30) days after any request by
Lender, Borrower shall cause Owner to deliver to Lender and pay for (or
reimburse Lender for cost of) any reports of third parties (e.g., engineers or
environmental consultants) requested by Lender as to the Collateral Property in
the event that the Net Operating Income of the Collateral Property has declined
by ten percent (10%) or more since the date hereof.
6.18 Year 2000 Compliance. Owner and Borrower acknowledge awareness of the
potential effect of the problem generally known as "Year 2000 computer-related
dysfunction" ("Year 2000"). Each of Owner and Borrower represent that to the
best of their knowledge, all computers and computer-dependant systems of Owner
and Borrower, are, or will be, on or before December 20, 1999, able to function
notwithstanding Year 2000. Each of Owner and Borrower will promptly notify
Lender in the event Borrower discovers or determines that any of the
above-referenced computers will not be Year 2000 compliant prior to December 20,
1999. Owner and Borrower hereby covenant and agree that they will promptly
commence and diligently prosecute the remediation of any such Year 2000
dysfunction.
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6.19 Intentionally Deleted.
6.20 Performance by Owner and Borrower. Each of Owner and Borrower shall
in a timely manner observe, perform and fulfill each and every covenant, term
and provision of each Loan Document executed and delivered by, or applicable to
it, and shall not enter into or otherwise suffer or permit any amendment,
waiver, supplement, termination or other modification of any Loan Document
executed and delivered by, or applicable to, it without the prior written
consent of Lender.
6.21 Secondary Market Transaction Master Estoppel. (A) Prior to the
contemplated Secondary Market Transaction, Borrower and ▇▇▇▇ shall provide to
Lender a master estoppel letter ("Master Estoppel") in form and substance
satisfactory to Lender stating, without limitation, that as of the date of the
Master Estoppel, the information contained in each of the Tenant estoppel
letters delivered to Lender on or prior to the date of the closing of the Loan
("Closing Estoppels") is true and accurate in all material respects, and to the
extent any information in the Closing Estoppels is not accurate as of the date
of the Master Estoppel, then such Master Estoppel shall include a schedule of
exceptions to the accuracy of the Closing Estoppels, and (B) Borrower covenants
that commencing immediately, Borrower shall use commercially reasonable efforts
to provide to Lender an executed tenant estoppel letter, which shall be in form
and substance satisfactory to Lender, from (a) each Anchor Tenant, (b) each
Tenant paying base rent in an amount equal to or exceeding five percent (5%) of
the Operating Income from the applicable Collateral Property occupied by such
Tenant and (c) disregarding the area leased by those Tenants described in
clauses (a) and (b), Tenants of not less than seventy-five percent (75%) of the
remaining gross leasable area of each Collateral Property. In the event that
Borrower and ▇▇▇▇ are required to provide the Lender a Master Estoppel pursuant
to subsection (A) of this Section 6.21, ▇▇▇▇ agrees to execute simultaneously
with the execution of the Master Estoppel a limited recourse guaranty for the
benefit of Lender guaranteeing that, in the event that any of the information
provided in the Master Estoppel is materially false or misleading at the time
the Master Estoppel is provided to Lender, ▇▇▇▇ shall indemnify and hold Lender
harmless from any and all losses incurred by Lender in connection with such
misrepresentations made by ▇▇▇▇. To the extent tenant estoppel letters are
subsequently delivered to Lender in connection with a Secondary Market
Transaction as set forth in subsection (B) hereof, ▇▇▇▇ and Borrower shall be
released from the Master Estoppel limited recourse guaranty.
6.22 Intentionally Deleted.
VII NEGATIVE COVENANTS
From the date hereof until payment and performance in full of all
obligations of Borrower under the Loan Documents or the earlier release of the
Lien of the Mortgage encumbering the Collateral Property in accordance with the
terms of this Agreement and the other Loan Documents, each of Owner and Borrower
covenant and agree with Lender that it will not do, directly or indirectly, any
of the following:
7.1 Management Agreement. Without Lender's prior consent: (i) surrender,
terminate, cancel, extend or renew the Management Agreement (other than an
extension or renewal on the
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same terms as the expiring Management Agreement, with only such modifications as
do not require consent of Lender or any Applicable Rating Agency hereunder) or
otherwise replace the Manager or enter into any other management agreement
(except pursuant to Section 6.13.2); (ii) reduce or consent to the reduction of
the term of the Management Agreement; (iii) increase or consent to the increase
of the amount of any charges under the Management Agreement; (iv) otherwise
modify, change, supplement, alter or amend in any material respect, or waive or
release in any material respect any of its rights and remedies under, the
Management Agreement; or (v) suffer or permit the occurrence and continuance of
a default beyond any applicable cure period under the Management Agreement (or
any successor management agreement) if such default permits the Manager to
terminate the Management Agreement (or such successor management agreement);
7.2 Liens. Without Lender's prior consent, create, incur, assume, permit
or suffer to exist any mechanic's, materialmen's or other Lien (other than an
inchoate mechanic's lien the amount of which is not yet due and payable) on any
portion of the Collateral Property or legal or beneficial ownership interest in
Owner or Borrower, except Permitted Encumbrances, unless such Lien is bonded or
discharged within thirty (30) days after Owner or Borrower first receives notice
of such Lien; provided, however, that the existence of liens resulting from
mechanics or materialmen hired by a Tenant shall not constitute a Default or
Event of Default hereunder so long as the Owner is diligently taking all
commercially reasonable action to enforce the obligation of such Tenant to cause
such lien to be removed;
7.3 Dissolution. Dissolve, terminate, liquidate, merge with or consolidate
into another Person;
7.4 Change In Business or Operation of Property. Enter into any line of
business other than the ownership and operation of the Collateral Property, or
make any material change in the scope or nature of its business objectives,
purposes or operations, or undertake or participate in activities other than the
continuance of its present business or otherwise cease to operate the Collateral
Property as a retail property or terminate such business for any reason
whatsoever (other than temporary cessation in connection with renovations to the
Collateral Property);
7.5 Debt Cancellation. Cancel or otherwise forgive or release any claim or
debt owed to Owner or Borrower by any Person, except in the ordinary course of
such Owner's or Borrower's business in its reasonable judgment and in a manner
consistent with the operation of first class retail properties;
7.6 Assets. Purchase or own any property other than the Collateral
Property and other property intended to be subject to the lien of the Mortgage;
7.7 Transfers. Without the prior written consent of Lender which will not
be unreasonably withheld or delayed, neither Owner or Borrower nor any other
Person having an ownership or beneficial interest, direct or indirect, in Owner
or Borrower or the general partner or managing member of Owner or Borrower, as
applicable, shall (a) directly or indirectly sell, transfer, convey, mortgage,
pledge, or assign the Collateral Property, any part thereof or any interest
therein (including any ownership interest in Owner or Borrower or such general
partner
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or managing member, as applicable, (a "Transfer"), (b) further encumber,
alienate, ▇▇▇▇▇ ▇ ▇▇▇▇ or grant any other interest in the Collateral Property or
any part thereof (including any ownership interest in Owner or Borrower and such
general partner or managing member), whether voluntarily or involuntarily or (c)
enter into any easement or other agreement granting rights in or restricting the
use or development of the Collateral Property which may have a material adverse
effect on the Collateral Property.
(a) Notwithstanding the foregoing prohibition on Transfers, the
Lender shall grant a consent to the Transfer by any or all Borrower(s) or Owner
of its interests in any or all of the Collateral Properties that such Borrower
or Owner owns and the assumption of the Loan by the transferee upon reasonable
satisfaction of the following conditions:
(i) No Default or Event of Default shall have occurred or be
continuing;
(ii) Borrower shall deliver to Lender any documents reasonably
required by Lender to evidence the assumption of this Agreement, the Note,
the Mortgages and the other Loan Documents by the proposed transferee,
subject to the provisions of Section 11.1 of this Agreement;
(iii) Borrower shall pay all of Lender's reasonable costs and
expenses incurred in connection with the Lender's consent and approval of
the Transfer in accordance with Section 6.15;
(iv) Borrower shall deliver to Lender a Rating Comfort Letter;
(v) Borrower shall deliver an non-consolidation opinion with
regard to the proposed transferee and its partners or members, as the case
may be, in form and substance reasonably satisfactory to Lender;
(vi) The proposed transferee must be a Special Purpose Entity and
comply with the representations and covenants contained in Sections 5.1.1
and 5.1.39 of this Agreement;
(vii) In the case of (A) a transfer by Owner, the Borrower shall
at all times be a wholly-owned subsidiary of Owner (B) a transfer by
Borrower, the Owner shall retain one hundred percent (100%) ownership in
the Borrower, and Owner shall at all times guaranty the Obligations of
Borrower on the same terms as of the date hereof; and
(viii) Such other conditions as Lender shall determine in its
reasonable discretion to be in the interest of Lender, including, without
limitation, Lender's approval of the creditworthiness, reputation and
qualifications of the proposed transferee with respect to the Loan and the
Collateral Property.
Lender shall not be required to demonstrate any actual impairment of its
security or any increased risk of default hereunder in order to declare the Debt
immediately due and payable upon the Transfer of the Collateral Property or any
part thereof without Lender's consent. This provision shall apply to any
Transfer of the Collateral Property regardless of whether voluntary or not, or
whether or not Lender has consented to any previous Transfer of the Collateral
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Property. Notwithstanding anything to the contrary contained herein, for such
time as the UBS Letter of Credit remains outstanding, the Borrower must, in
addition to satisfying the requirements of this subsection (a), obtain the
written consent of UBS prior to completing any Transfer permitted under this
Section 7.7 which will affect the interests in the Owner and Borrower otherwise
pledged to UBS under that certain Pledge and Security Agreement, dated of even
date herewith, by and between Westfield America Investor L.P. and Westfield
America Limited Partnership (the "Pledge and Security Agreement") which is
executed in connection with the issuance of the UBS Letter of Credit under the
Letter of Credit Agreement and all other documents executed in connection
therewith.
(b) Provided no Default or Event of Default has occurred and is
continuing under this Agreement or the other Loan Documents, the prior written
consent of the Lender and the approval of the Applicable Rating Agencies shall
not be required for the following Transfers provided that any reasonable costs
and expenses incurred by the Lender in reviewing any such proposed Transfer
shall be paid by Borrower, regardless of whether such consent or approval is
given by Lender:
(i) Any Transfer of any interest in Owner or Borrower between and
among that Owner's or Borrower's partners or members to Affiliates of such
Borrower and Borrower's partners or members;
(ii) Any Transfer of interests in any of any Owner's or
Borrower's partners or members (between and among the partners and
members);
(iii) Any Transfer by devise or descent or by operation of law
upon the death of a partner or member of Owner or Borrower;
(iv) Any Transfers of interests in the Borrower to UBS AG,
Stamford Branch in its capacity as issuer of the UBS Letter of Credit; or
(v) Any Transfers of limited partnership or membership interests
in Owner or Borrower up to an aggregate of fifty percent (50%) of such
interests; provided, however that
(A) Lender must receive at least sixty (60) days prior written
notice of any proposed Transfer pursuant to this subsection;
(B) Westfield Limited Partnership or an approved general
partner (collectively, "Westfield") must retain at least fifty
percent (50%) ownership interest in Owner and Borrower and Westfield
must, following any such Transfer, retain control of Owner and
Borrower and the day to day operations of the Collateral Property;
(C) Lender shall have received evidence satisfactory to it
that Owner and Borrower and their respective partners or members, as
the case may be, following such transfer, remain Special Purpose
Entities in accordance with the standards of the Applicable Rating
Agencies; and
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(D) If requested by Lender, Lender shall have received a
non-consolidation opinion with regard to the proposed transferee and
its partners or members, as the case may be, in form and substance
satisfactory to Lender.
(c) Notwithstanding the foregoing restrictions on Transfers, nothing
contained in this Agreement or the other Loan Documents shall in any way
restrict or prohibit, nor shall any notice to Lender or consent of Lender be
required in connection with, (i) the transfer or issuance of any securities or
interests in Westfield America, Inc. ("WEA"), (ii) the merger or consolidation
of WEA (iii) the transfer or issuance of any securities or interests in
Westfield America Limited Partnership ("▇▇▇▇") or (iv) the merger or
consolidation of ▇▇▇▇. With respect to the events set forth in subsections (iii)
and (iv) hereof, to the extent that such transfers, issuance of securities or
interests, merger or consolidation of ▇▇▇▇ result in a change of ownership or
control in ▇▇▇▇, the Borrower must be owned and controlled by an entity that
provides the same expertise as ▇▇▇▇ in conducting business of the nature
currently conducted by ▇▇▇▇. Prior to completing any action with respect to ▇▇▇▇
pursuant to subsections (iii) and (iv) hereof that will result in a change in
control of ▇▇▇▇, the Borrower must deliver to Lender a Rating Comfort Letter and
a non-consolidation opinion with regard to the proposed transferee and its
partners or members, as the case may be, in form and substance satisfactory to
Lender, provided that no Rating Comfort Letter or non-consolidation opinion
shall be required in connection with subsection (i) or (ii) hereof.
(d) In accordance with the provisions of the entity documents of
each Borrower, in no event shall the provisions of this Section 7.7 be amended
or modified in any manner until such time as the Borrower has obtained a Rating
Comfort Letter.
7.8 Debt. Create, incur or assume any indebtedness other than (i) the
Debt, (ii) Taxes, Insurance Premiums, Approved Replacement Expenses and Approved
Leasing Expenses and (iii) other trade debt incurred in the ordinary course of
business relating to the ownership and operation of the Collateral Property
which other trade debt does not exceed, at any time, a maximum aggregate amount
of $1,000,000.00, and such trade debt is paid within sixty (60) days of the date
incurred (other than amounts being disputed in good faith);
7.9 Assignment of Rights. Without Lender's prior consent, attempt to
assign Owner's or Borrower's rights or interest under any Loan Document in
contravention of any Loan Document.
7.10 Principal Place of Business. Change its principal place of business
without first giving Lender thirty (30) days' prior written notice;
7.11 Corporate Organization. Make any change, amendment or modification to
the organizational documents of Owner or Borrower, or take any other action, if
such change, amendment, modification or action could result in (x) Owner or
Borrower not being a Special Purpose Entity or (y) the term of Owner, Borrower,
Owner Representative or Borrower Representative being shortened.
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7.12 ERISA.
(a) Neither Owner nor Borrower shall engage in any transaction which
would cause any obligation, or action taken or to be taken, hereunder (or the
exercise by Lender of any of its rights under the Note, this Agreement or the
other Loan Documents) to be a non-exempt (under a statutory or administrative
class exemption) prohibited transaction under ERISA.
(b) Each of Owner and Borrower further covenant and agree to deliver
to Lender such certifications or other evidence from time to time throughout the
term of the Loan, as requested by Lender in its sole discretion, that (A)
neither Owner nor Borrower is or maintains an "employee benefit plan" as defined
in Section 3(3) of ERISA, which is subject to Title I of ERISA, or a
"governmental plan" within the meaning of Section 3(3) of ERISA; (B) neither
Owner nor Borrower is subject to state statutes regulating investments and
fiduciary obligations with respect to governmental plans; and (C) one or more of
the following circumstances is true:
(i) Equity interests in each of Owner and Borrower are publicly
offered securities, within the meaning of 29 C.F.R. ss.2510.3-101(b)(2);
(ii) Less than twenty-five percent (25%) of each outstanding
class of equity interests in each of Owner and Borrower are held by
"benefit plan investors" within the meaning of 29
C.F.R.ss.2510.3-101(f)(2); or
(iii) Each of Owner and Borrower qualify as an "operating
company" or a "real estate operating company" within the meaning of 29
C.F.R.ss.2510.3-101(c) or (e).
7.13 No Joint Assessment. Neither Owner nor Borrower shall suffer,
permit or initiate the joint assessment of the Collateral Property with (a) any
other real property constituting a tax lot separate from the Collateral
Property, or (b) any portion of the Collateral Property which may be deemed to
constitute personal property, or any other procedure whereby the Lien of any
taxes which may be levied against such personal property shall be assessed or
levied or charged to the Collateral Property.
7.14 Affiliate Transactions. Neither Owner nor Borrower shall enter
into, or be a party to, any transaction with an Affiliate of Owner or Borrower
or any of the partners of Owner or Borrower except in the ordinary course of
business and on terms which are fully disclosed to Lender in advance and are no
less favorable to Owner or Borrower or such Affiliate than would be obtained in
a comparable arm's-length transaction with an unrelated third party. Lender
hereby acknowledges that it has reviewed and approved the Design Development and
Construction Agreement between Annapolis Mall Limited Partnership and Westfield
Corporation, Inc., as developer thereunder, dated February 1, 1999 and the
Management Agreement.
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VIII Insurance.
8.1.1 Coverage. Owner and Borrower, at their sole cost, for the
mutual benefit of Owner, Borrower and Lender, shall obtain and maintain during
the Term the following policies of insurance with respect to the Collateral
Property:
(a) Property insurance insuring against loss or damage by standard,
"all-risk" perils, which shall (i) be in an amount equal to the greatest of (A)
the then full replacement cost of the Collateral Property without deduction for
physical depreciation, (B) the unpaid Principal, and (C) such amount as is
necessary so that the insurer would not deem Owner or Borrower a co-insurer
under such policies, (ii) have deductibles or self insured retentions no greater
than $25,000 (or, in the case of earthquake insurance, five percent (5%) of the
total insured values at risk), (iii) be paid annually in advance and (iv)
contain an "agreed amounts" and a "Replacement Cost Endorsement" with a waiver
of depreciation.
(b) Flood insurance if any part of the Collateral Property is
located in an area identified by the Federal Emergency Management Agency as an
area having special flood hazards in an amount to be determined by Lender.
(c) Commercial general public liability insurance, including broad
form property damage, blanket contractual and personal injuries (including death
resulting therefrom) coverages and containing minimum limits per occurrence of
$1,000,000 and $2,000,000 in the aggregate per location for any policy year;
together with at least $50,000,000 excess and/or umbrella liability insurance
for any and all claims, including all legal liability imposed upon Borrower and
all court costs and attorneys' fees incurred in connection with the ownership,
operation and maintenance of the Collateral Property.
(d) Rental loss and/or business interruption insurance in an amount
equal to the estimated Rents for the next succeeding 18-month period. The amount
of such insurance shall be increased from time to time during the Term as and
when the estimated or actual Rents increase.
(e) Insurance against loss or damage from (i) leakage of sprinkler
systems and (ii) explosion of steam boilers, air conditioning equipment, high
pressure piping, machinery and Equipment, pressure vessels or similar apparatus
now or hereafter installed in any of the Improvements (without exclusion for
explosions), in an amount at least equal to $2,000,000.
(f) Worker's compensation insurance with respect to any employees of
Owner, as required by any Legal Requirement.
(g) During the period in which the New Construction is being
undertaken and during any period of repair or restoration, builder's "all-risk"
insurance in an amount equal to not less than the full insurable value of the
Collateral Property, against such risks (including fire and extended coverage
and collapse of the Improvements to agreed limits) as Lender may request, in
form and substance acceptable to Lender.
(h) Ordinance or Law Coverage to compensate for the diminished value
of the Collateral Property, the cost of demolition and the increased cost of
construction in an amount satisfactory to Lender.
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(i) Such other insurance (including earthquake insurance and
windstorm insurance) as may from time to time be reasonably required by Lender
in order to protect its interests and as is otherwise commercially reasonable.
8.1.2 Policies.
(a) All policies of insurance (the "Policies") required pursuant to
Section 8.1.1 (other than earthquake insurance) shall (i) be issued by companies
approved by Lender and licensed to do business in the State, with a claims
paying ability rating of "AA" or better by S&P and a rating of A:VII or better
in the current Best's Insurance Reports ("Approved Insurer"); (ii) name Lender
and its successors and/or assigns as their interest may appear as the mortgagee
(in the case of property insurance) or an additional insured (in the case of
liability insurance); (iii) contain (in the case of property insurance) a
Non-Contributory Standard Lender Clause and a Lender's Loss Payable Endorsement,
or their equivalents, naming Lender as the person to which all payments made by
such insurance company shall be paid; (iv) contain a waiver of subrogation
against Lender, (v) be delivered to Lender (provided that copies may be
delivered in lieu of originals) together with an insurance certificate; (vi)
contain such provisions as Lender deems reasonably necessary or desirable to
protect its interest, including endorsements providing that neither the Owner,
Borrower, Lender nor any other party shall be a co-insurer under the Policies
and that Lender shall receive at least 30 days' prior written notice of any
modification, reduction or cancellation of any of the Policies; and (vii) be
satisfactory in form and substance to Lender and approved by Lender as to
amounts, form, risk coverage, deductibles, loss payees and insureds. Each
Borrower shall pay the premiums for the Policies required to be maintained by it
hereunder (the "Insurance Premiums") as the same become due and payable and
furnish to Lender evidence of the renewal of each of the Policies together with
(unless such Insurance Premiums have been paid by Lender pursuant to Section
4.3) receipts for or other evidence of the payment of the Insurance Premiums
reasonably satisfactory to Lender. If Owner or Borrower do not furnish such
evidence and receipts at least thirty (30) days prior to the expiration of any
expiring Policy, then Lender may, but shall not be obligated to, procure such
insurance and pay the Insurance Premiums therefor, and Owner and Borrower shall
reimburse Lender for the cost of such Insurance Premiums promptly on demand,
with interest accruing at the Default Rate. Owner and Borrower shall deliver to
Lender a copy of each Policy (and an insurance certificate pertaining thereto)
required to be maintained by it hereunder within ninety (90) days after its
effective date. Within ninety (90) days after request by Lender, Owner and
Borrower shall obtain such increases in the amounts of coverage required
hereunder as may be reasonably requested by Lender, taking into consideration
changes in the value of money over time, changes in liability laws, changes in
prudent customs and practices, and such coverage as is commercially available.
8.2 Casualty.
8.2.1 Notice; Restoration. If the Collateral Property is damaged or
destroyed, in whole or in part, by fire or other casualty (a "Casualty"),
Borrower shall give prompt notice thereof to Lender. Following the occurrence of
a Casualty, Owner and Borrower, regardless of whether insurance proceeds are
available, shall promptly proceed to restore, repair, replace or rebuild the
Collateral Property in accordance with Legal Requirements to be of at least
equal value and of substantially the same character as prior to such damage or
destruction.
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8.2.2 Settlement of Proceeds. In the event of a Casualty covered by
any of the Policies (an "Insured Casualty") where the loss does not exceed
$1,000,000, Borrower may settle and adjust any claim without the consent of
Lender; provided such adjustment is carried out in a competent and timely
manner; and Borrower is hereby authorized to collect and receipt for the
insurance proceeds (the "Proceeds"). In the event of an Insured Casualty where
the loss equals or exceeds $1,000,000, Lender may settle and adjust any claim
without the consent of Owner or Borrower and agree with the insurer(s) on the
amount to be paid on the loss, and the Proceeds shall be due and payable solely
to Lender and held by Lender in the Casualty/Condemnation Fund and disbursed in
accordance herewith. The expenses incurred by Lender in the adjustment and
collection of the Proceeds shall become part of the Debt and shall be reimbursed
by the Borrower to Lender upon demand.
8.3 Condemnation.
8.3.1 Notice; Restoration. Owner and Borrower shall promptly give
Lender notice of the actual or threatened commencement of any condemnation or
eminent domain proceeding affecting the Collateral Property (a "Condemnation")
and shall deliver to Lender copies of any and all papers served in connection
with such Condemnation. Following the occurrence of a Condemnation, Owner and
Borrower, regardless of whether an Award is available, shall promptly proceed to
restore, repair, replace or rebuild the Collateral Property in accordance with
all Legal Requirements to the extent practicable to be of at least equal value
and of substantially the same character as prior to such Condemnation.
8.3.2 Collection of Award. Lender is hereby irrevocably appointed as
Owner's and Borrower's attorney-in-fact, coupled with an interest, with
exclusive power to collect, receive and retain any award or payment in respect
of a Condemnation in excess of $1,000,000 (an "Award") and to make any
compromise or settlement in connection with such Condemnation. Notwithstanding
any Condemnation (or any transfer made in lieu of or in anticipation of such
Condemnation), Borrower shall continue to pay the Debt at the time and in the
manner provided for in the Loan Documents, and the Debt shall not be reduced
unless and until any Award shall have been actually received and applied by
Lender to expenses of collecting the Award and to discharge of the Debt. Lender
shall not be limited to the interest paid on the Award by the condemning
authority but shall be entitled to receive out of the Award interest at the
Applicable Interest Rate. If the Collateral Property is sold, through
foreclosure or otherwise, prior to the receipt by Lender of such Award, Lender
shall have the right, whether or not a deficiency judgment on the Note shall be
recoverable or shall have been sought, recovered or denied, to receive all or a
portion of the Award sufficient to pay the Debt. Owner shall cause any Award
that is payable to Owner to be paid directly to Lender. Lender shall hold such
Award in the Casualty/Condemnation Fund and disburse such Award in accordance
with the terms hereof.
8.4 Application of Proceeds or Award.
8.4.1 Application to Restoration. In the event of an Insured
Casualty or Condemnation with respect to the Collateral Property where (i) the
loss is in an aggregate amount less than twenty-five percent (25%) of the
Principal amount of the Loan, (ii) in the reasonable judgment of Lender, the
Collateral Property can be restored within six (6) months,
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and prior to the Anticipated Repayment Date and the expiration of the business
interruption insurance with respect thereto, to an economic unit not less
valuable and not less useful than the same was prior to the Insured Casualty or
Condemnation, and after such restoration will adequately secure the unpaid
Principal, and (iii) no Event of Default shall have occurred and be then
continuing, then the Proceeds or the Award, as the case may be (after
reimbursement of any expenses incurred by Lender), shall be applied to reimburse
the Owner for the cost of restoring, repairing, replacing or rebuilding the
Collateral Property (the "Restoration"), in the manner set forth herein. The
Owner shall commence and diligently prosecute such Restoration; provided that
(x) Owner shall pay (and if required by Lender, Owner shall deposit with Lender
in advance) all costs of such Restoration in excess of the net amount of the
Proceeds or the Award made available pursuant to the terms hereof; and (y)
Lender shall have received evidence reasonably satisfactory to it that during
the period of the Restoration, the Rents (including all Proceeds paid to Lender
from the business interruption insurance required pursuant to Section 8.1.1)
from the Collateral Property will be sufficient to satisfy all of Borrower's
Obligations.
8.4.2 Application to Debt. Except as provided in Section 8.4.1, the
Proceeds and any Award in excess of $1,000,000 may, at the option of Lender in
its sole discretion, be applied to the payment of the Debt as set forth in
Section 3.2.2, or applied to reimburse Owner for the cost of any Restoration, in
the manner set forth in Section 8.4.3. Any such application to the prepayment of
the Loan shall be without any prepayment consideration or penalty, unless the
Debt or any portion thereof is accelerated prior to, or within one year after,
the date the Proceeds are received from the insurance company or the Award is
received from the condemning authority, as the case may be, in which event the
Borrower shall pay to Lender an additional amount equal to the Yield Maintenance
Premium, if any, that may be required with respect to the amount of the Proceeds
or Award applied to the Debt.
8.4.3 Procedure for Application to Restoration. If Owner is entitled
to reimbursement out of the Proceeds or an Award held by Lender, such Proceeds
or Award shall be disbursed from time to time from the Casualty/Condemnation
Fund upon Lender being furnished with (i) evidence satisfactory to it of the
estimated cost of completion of the Restoration, (ii) funds or, at Lender's
option, assurances satisfactory to Lender that such funds are available
sufficient, in addition to the Proceeds or Award, to complete the proposed
Restoration, (iii) such architect's certificates, waivers of lien, contractor's
sworn statements, title insurance endorsements, bonds, plats of survey and such
other evidences of cost, payment and performance as Lender may reasonably
require and approve, and (iv) all plans and specifications for such Restoration,
such plans and specifications to be approved by Lender prior to commencement of
any work. No payment made prior to the final completion of the Restoration shall
exceed ninety percent (90%) of the value of the work performed from time to
time; funds other than the Proceeds or Award shall be disbursed prior to
disbursement of such Proceeds or Award; and at all times, the undisbursed
balance of such Proceeds or Award remaining in the hands of Lender, together
with funds deposited for that purpose or irrevocably committed to the
satisfaction of Lender by or on behalf of Owner for that purpose, shall be at
least sufficient in the reasonable judgment of Lender to pay for the cost of
completion of the Restoration, free and clear of all Liens or claims for Lien.
Any surplus that remains out of the Proceeds held by Lender after payment of
such costs of Restoration shall be paid to Owner. Any surplus that remains out
of the Award received by Lender after payment of such costs of Restoration
shall, in
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the sole and absolute discretion of Lender, be retained by Lender and applied to
payment of the Debt or returned to Owner.
8.4.4 Anchor Lease; REA. If Lender shall have the right or option
hereunder to apply Proceeds or an Award to payment of the Debt, but under any
controlling provision in any "anchor" Lease or REA such Proceeds or Awards are
required to be applied to Restoration of the Collateral Property, then,
notwithstanding anything to the contrary in this Article 8, such Proceeds or
Award shall be applied to Restoration in accordance with such "anchor" Lease or
REA, subject to such conditions and procedures as Lender may impose which are
not inconsistent with the terms of such "anchor" Lease or REA.
IX DEFAULTS
9.1 Events of Default. An "Event of Default" shall exist with respect to
the Loan upon the occurrence of any of the following events:
(a) any portion of the Debt is not paid when due;
(b) Borrower shall fail to pay when due any deposit into any Fund;
(c) any of the Taxes applicable to the Collateral Property are not
paid when due (other than Taxes for which funds have been deposited with Lender
pursuant to Section 4.3), subject to Borrower's right to contest Taxes in
accordance with Section 6.2;
(d) the Policies with respect to the Collateral Property are not
delivered to Lender within ninety (90) days after their respective applicable
effective dates or within ten days after written demand from Lender, whichever
is later, or such Policies are not kept in full force and effect;
(e) a Transfer other than a Transfer permitted pursuant to Section
7.7 occurs with respect to the Collateral Property, any interest in Owner or
Borrower or an interest in or Owner Representative or Borrower Representative of
any Borrower;
(f) any representation or warranty made by Owner or Borrower or in
any Loan Document, or in any report, certificate, financial statement or other
instrument, agreement or document furnished by Owner or Borrower in connection
with any Loan Document, shall be false or misleading in any material respect as
of the date the representation or warranty was made;
(g) Owner, Borrower, Owner Representative or Borrower Representative
shall make an assignment for the benefit of creditors, or shall generally not be
paying its debts as they become due;
(h) a receiver, liquidator or trustee shall be appointed for Owner,
Borrower, Owner Representative or Borrower Representative, or Owner, Borrower,
Owner Representative or Borrower Representative shall be adjudicated a bankrupt
or insolvent; or any petition for bankruptcy, reorganization or arrangement
pursuant to federal bankruptcy law, or any similar
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federal or state law, shall be filed by or against, consented to, or acquiesced
in by, Owner, Borrower, Owner Representative or Borrower Representative, as the
case may be; or any proceeding for the dissolution or liquidation of Owner,
Borrower, Owner Representative or Borrower Representative shall be instituted;
provided, however, if such appointment, adjudication, petition or proceeding was
involuntary and not consented to by Owner, Borrower, Owner Representative or
Borrower Representative, as the case may be, only upon the same not being
discharged, stayed or dismissed within sixty (60) days;
(i) Owner or Borrower breaches any negative covenant contained in
Sections 7.3, 7.4, 7.6, 7.7, 7.8, 7.10 or 7.11 or any affirmative covenant
contained in Section 6.14;
(j) Owner or Borrower shall be in default under any other mortgage
or security agreement covering any part of the Collateral Property owned by such
Borrower whether it be superior or junior in Lien to the Mortgage, and such
default shall continue after the expiration of any applicable notice and grace
period provided therein;
(k) except as permitted hereunder, Owner or Borrower shall commence
any alteration, improvement, demolition or removal of any of the Improvements
constituting part of the Collateral Property without the prior consent of
Lender;
(l) an Event of Default as defined or described in any other Loan
Document (including, without limitation, the Guaranty), occurs; or any other
event shall occur or condition shall exist, if the effect of such event or
condition is to accelerate or to permit Lender to accelerate the maturity of the
Debt;
(m) Owner or Borrower shall be in default under any term, covenant
or provision set forth herein or in any other Loan Document which specifically
contains a notice requirement or grace period and such notice has been given and
such grace period has expired;
(n) any of the assumptions contained in the Insolvency Opinion or an
Additional Insolvency Opinion were not true and correct as of the date of such
opinion or thereafter became untrue or incorrect and Owner or Borrower fails to
deliver to Lender, within twenty (20) days after Owner or Borrower first become
aware that any such assumption is not true or is incorrect, a new substantive
non-consolidation opinion from the same counsel (or other counsel acceptable to
Lender and the Applicable Rating Agencies) which omits all such untrue or
incorrect assumptions and is otherwise in the same form as the Insolvency
Opinion or the Additional Insolvency Opinion, as applicable (other than for
changes approved by Lender and the Applicable Rating Agencies);
(o) Intentionally Deleted;
(p) Intentionally Deleted.
(q) Owner or Borrower shall permit any event to occur that would
cause any REA to terminate without notice or action by any party thereto or
would entitle any party to terminate any REA and the term thereof by giving
notice to Owner or Borrower; or any REA shall be surrendered, terminated or
canceled for any reason or under any circumstance whatsoever; or any term of any
REA shall be modified or supplemented without Lender's consent; or Owner or
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Borrower shall fail, within ten (10) Business Days after demand by Lender, to
exercise its option to renew or extend the term of any REA or shall fail or
neglect to pursue diligently all actions necessary to exercise such renewal
rights pursuant to such REA; or
(r) Owner or Borrower shall continue to be in Default under any of
the other terms, covenants or conditions of this Agreement or any other Loan
Document not specified in this Section 9.1, for ten (10) days after notice to
Owner or Borrower, as applicable, from Lender, in the case of any Default which
can be cured by the payment of a sum of money, or for thirty (30) days after
notice from Lender in the case of any other Default; provided, however, that if
such non-monetary Default is susceptible of cure but cannot reasonably be cured
within such 30-day period, and Owner or Borrower, as applicable, 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 an additional period of time as is reasonably necessary for
Owner or Borrower, as applicable, in the exercise of due diligence to cure such
Default, such additional period not to exceed 90 days.
9.2 Remedies.
9.2.1 Acceleration. Upon the occurrence of an Event of Default with
respect to the Loan (other than an Event of Default described in paragraph (g)
or (h) of Section 9.1) and at any time and from time to time thereafter, in
addition to any other rights or remedies available to it pursuant to the Loan
Documents or at law or in equity, Lender may take such action, without notice or
demand, that Lender deems advisable to protect and enforce its rights against
Owner or Borrower and in and to the Collateral Property, and upon any Event of
Default described in paragraph (g) or (h) of Section 9.1, the Debt and all
amounts owing under the Guaranty (including unpaid interest, Default Rate
interest, Late Payment Charges, Yield Maintenance Premium and any other amounts
owing by Owner and/or Borrower) shall immediately and automatically become due
and payable, without notice or demand, and Owner and Borrower hereby expressly
waive any such notice or demand, anything contained in any Loan Document to the
contrary notwithstanding.
9.2.2 Remedies Cumulative. Upon the occurrence of an Event of
Default, all or any one or more of the rights, powers, privileges and other
remedies available to Lender against Owner and Borrower under the Loan Documents
or at law or in equity may be exercised by Lender at any time and from time to
time, whether or not all or any of the Debt shall be declared due and payable,
and whether or not Lender shall have commenced any foreclosure proceeding or
other action for the enforcement of its rights and remedies under any of the
Loan Documents. Any such actions taken by Lender shall be cumulative and
concurrent and may be pursued independently, singly, successively, together or
otherwise, at such time and in such order as Lender may determine in its sole
discretion, to the fullest extent permitted by law, without impairing or
otherwise affecting the other rights and remedies of Lender permitted by law,
equity or contract or as set forth in the Loan Documents. Without limiting the
generality of the foregoing, Owner and Borrower agree that if an Event of
Default is continuing, (i) to the extent permitted by applicable law, Lender is
not subject to any "one action" or "election of remedies" law or rule, and (ii)
all Liens and other rights, remedies or privileges provided to Lender shall
remain in full force and effect until Lender has exhausted all of its remedies
under the Guaranty, against the Collateral Property, the Mortgage has been
foreclosed, the Collateral
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Property has been sold and/or otherwise realized upon in satisfaction of the
Debt or the Debt has been paid in full.
9.2.3 Severance. Lender shall have the right from time to time to
sever the Note and the other Loan Documents into one or more separate notes,
mortgages and other security documents in such denominations as Lender shall
determine in its sole discretion for purposes of evidencing and enforcing its
rights and remedies. Owner and Borrower shall execute and deliver to Lender from
time to time, promptly after the request of Lender, a severance agreement and
such other documents as Lender shall request in order to effect the severance
described in the preceding sentence, all in form and substance reasonably
satisfactory to Lender. Each of Owner and Borrower hereby absolutely and
irrevocably appoints Lender as its true and lawful attorney, coupled with an
interest, in its name and stead to make and execute all documents necessary or
desirable to effect such severance, Owner and Borrower ratifying all that such
attorney shall do by virtue thereof.
9.2.4 Delay. No delay or omission to exercise any remedy, right,
power accruing upon an Event of Default, or the granting of any indulgence or
compromise by Lender shall impair any such remedy, right or power hereunder or
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. Notwithstanding any other provision of this Agreement, to
the extent permitted by applicable law, Lender reserves the right to seek a
deficiency judgment or preserve a deficiency claim, in connection with the
foreclosure of the Mortgage, to the extent necessary to foreclose on the Rents,
the Funds or any other collateral that constitutes security for the same
obligation.
9.2.5 Lender's Right to Perform. If Owner or Borrower fails to
perform any covenant or obligation contained herein and such failure shall
continue for a period of (5) five Business Days after Borrower's receipt of
written notice thereof from Lender, without in any way limiting Lender's right
to exercise any of its rights as provided hereunder or under any of the other
Loan Documents, Lender may, but shall have no obligation to, perform, or cause
performance of, such covenant or obligation, and the expenses of Lender incurred
in connection therewith shall be payable by Borrower to Lender upon demand and
if not paid shall be added to the Debt and shall bear interest thereafter at the
Default Rate. Notwithstanding the foregoing, Lender shall have no obligation to
send notice to Owner or Borrower of such failure.
X SPECIAL PROVISIONS
10.1 Sale of Note and Secondary Market Transaction.
10.1.1 Cooperation. At Lender's request (to the extent not already
required to be provided by Borrower under this Agreement), Owner, Borrower and
▇▇▇▇ shall cooperate with Lender to enable Lender to satisfy the market
standards to which Lender customarily adheres or which may be reasonably
required in the marketplace or by the Applicable Rating Agencies in connection
with one or more sales or assignments of the Note or participations therein or
securitizations (including any FASIT) of rated single or multi-class securities
(the
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"Securities") secured by or evidencing ownership interests in the Note and the
Mortgage (each such sale, assignment, participation and/or securitization, a
"Secondary Market Transaction"). Neither Owner nor Borrower shall be required to
incur any out-of-pocket expense to comply with the provisions of this Section
10.1.1 (unless Lender agrees to reimburse Owner or Borrower therefor). In
furtherance of the foregoing, Owner, Borrower and ▇▇▇▇ shall, at the request of
Lender in connection with any Secondary Market Transaction, and so long as the
Loan is still outstanding:
(a) (i) provide updates of financial and other information with
respect to the Collateral Property, Owner, Borrower and their respective
Affiliates, Manager and any Tenants, (ii) provide updated business plans and
budgets relating to the Collateral Property and (iii) perform or permit or cause
to be performed or permitted such site inspections, appraisals, surveys, market
studies, environmental reviews and reports (Phase I's and, if appropriate, Phase
II's), engineering reports and other due diligence investigations of the
Collateral Property, as may be reasonably requested from time to time by Lender
or the Applicable Rating Agencies or as may be necessary or appropriate in
connection with a Secondary Market Transaction or Exchange Act requirements (the
items provided to Lender pursuant to this paragraph (a) being called the
"Provided Information"), together, if customary, with appropriate verification
of and/or consents to the Provided Information through letters of auditors or
opinions of counsel of independent attorneys acceptable to Lender and the
Applicable Rating Agencies;
(b) use reasonable efforts to cause counsel to render opinions as to
non-consolidation, fraudulent conveyance, true sale and true contribution and
any other opinion customary in securitization transactions with respect to the
Collateral Property, Owner, Borrower and their respective Affiliates, which
counsel and opinions shall be reasonably satisfactory to Lender and the
Applicable Rating Agencies;
(c) provide current certificates of good standing and qualification
with respect to Owner, Borrower and ▇▇▇▇ from appropriate Governmental
Authorities;
(d) execute such amendments to the Loan Documents and Owner's and
Borrower's organizational documents as may be requested by Lender or the
Applicable Rating Agencies or otherwise to effect a Secondary Market
Transaction, provided that nothing contained in this subsection (d) shall result
in an economic change in the transaction or impose any material legal
obligations on Owner or Borrower or restrict Owner or Borrower in any material
way;
(e) assist Lender in the event Lender requires the severance of the
Note or any other Loan Document in order to adjust its security interest in the
Collateral Property to enhance its position in the context of a Secondary Market
Transaction, provided that such severance of the Note or other applicable
adjustment in the security of the Loan pursuant to a Secondary Market
Transaction shall be completed at the sole cost of the Lender;
(f) deliver to Lender and/or any Applicable Rating Agency, (a) one
or more Officer's Certificates certifying as to the accuracy of all
representations made by Owner and Borrower in the Loan Documents as of the date
of the Loan Closing in all relevant jurisdictions or, if such representations
are no longer accurate, certifying as to what modifications to the
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representations would be required to make such representations accurate, and (b)
certificates of the relevant Governmental Authorities in all relevant
jurisdictions indicating the good standing and qualification of Owner, Borrower,
Owner Representative and Borrower Representative as of the date of the Secondary
Market Transaction;
(g) make such other representations and warranties as of the closing
date of the Secondary Market Transaction with respect to the Collateral
Property, Owner, Borrower, ▇▇▇▇, and the Loan Documents as are customarily
provided in securitization transactions and as may be reasonably requested by
the holder of the Note or the Rating Agencies and consistent with the facts
covered by such representations and warranties as they exist on the date
thereof, including the representations and warranties made in the Loan
Documents;
(h) participate in any meeting reasonably requested by the Lender,
such meeting to be attended by senior management of Owner, Borrower and/or ▇▇▇▇;
and
(i) obtain ratings of the Securities from two (2) or more Rating
Agencies.
10.1.2 Use of Information. Owner and Borrower understand that
certain of the Provided Information and the Required Records may be included in
disclosure documents in connection with a Secondary Market Transaction,
including a prospectus or private placement memorandum (each, a "Disclosure
Document") and may also be included in filings with the Securities and Exchange
Commission pursuant to the Securities Act of 1933, as amended (the "Securities
Act"), or the Securities and Exchange Act of 1934, as amended (the "Exchange
Act"), or provided or made available to investors or prospective investors in
the Securities, the Rating Agencies, and service providers or other parties
relating to the Secondary Market Transaction. In the event that the Disclosure
Document is required to be revised, Owner and Borrower shall cooperate with
Lender in updating the Provided Information or Required Records for inclusion or
summary in the Disclosure Document or for other use reasonably required in
connection with a Secondary Market Transaction by providing all current
information pertaining to Owner, Borrower, and the Collateral Property necessary
to keep the Disclosure Document accurate and complete in all material respects
with respect to such matters. Such disclosure may include the opinion or
judgment of Lender or Servicer concerning the Provided Information or other
matters disclosed.
10.1.3 Owner's and Borrower's Obligations Regarding Disclosure
Documents. In connection with a Disclosure Document, Owner and Borrower shall:
(a) if requested by Lender, certify in writing that Owner and
Borrower have carefully examined those portions of such Disclosure Document,
pertaining to Owner and Borrower, the Collateral Property, the Manager and the
Loan, including applicable portions of the sections entitled "Special
Considerations", "Description of the Mortgages", "Description of the Mortgage
Loans and Mortgaged Property", "The Manager," "The Borrower" and "Certain Legal
Aspects of the Mortgage Loan," and such portions (and portions of any other
sections reasonably requested and pertaining to Owner, Borrower, the Collateral
Property, the Manager or the Loan) do not contain any untrue statement of a
material fact or omit to state a material fact necessary in order to make the
statements made, in the light of the circumstances under which they were made,
not misleading;
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(b) indemnify (i) any underwriter, syndicate member or placement
agent (collectively, the "Underwriters") retained by Lender or its issuing
company affiliate (the "Issuer") in connection with a Secondary Market
Transaction, (ii) Lender and (iii) the Issuer that is named in the Disclosure
Document or registration statement relating to a Secondary Market Transaction
(the "Registration Statement"), and each of the Issuer's directors, each of its
officers who have signed the Registration Statement and each person or entity
who controls the Issuer or the Lender within the meaning of Section 15 of the
Securities Act or Section 30 of the Exchange Act (collectively within (iii), the
"UBS Group"), and each of its directors and each person who controls each of the
Underwriters, within the meaning of Section 15 of the Securities Act and Section
20 of the Exchange Act (collectively, the "Underwriter Group") for any losses,
claims, damages or liabilities (the "Liabilities") to which Lender, the UBS
Group or the Underwriter Group may become subject (including reimbursing all of
them for any legal or other expenses actually incurred in connection with
investigating or defending the Liabilities) insofar as the Liabilities arise out
of or are based upon any untrue statement of any material fact contained in any
of the Required Records or in any of the applicable portions of such sections of
the Disclosure Document applicable to Owner, Borrower, Manager, the Collateral
Property or the Loan, or arise out of or are based upon the omission or alleged
omission to state therein a material fact required to be stated in the
applicable portions of such sections or necessary in order to make the
statements in the applicable portions of such sections in light of the
circumstances under which they were made, not misleading, provided, however,
that neither Owner nor Borrower shall be required to indemnify Lender for any
Liabilities relating to untrue statements or omissions or inadequacies of
disclosure which (i) Owner or Borrower identified to Lender in writing at the
time of Owner's or Borrower's examination of such Disclosure Document or (ii)
are set forth in a report prepared by a third party not Affiliated with Owner or
Borrower; and
(c) reimburse any member of the UBS Group for any legal or other
expenses reasonably incurred by such member in connection with investigating or
defending the Liabilities.
Owner's and Borrowers' Liability under clause (a) or (b) above shall be limited
to Liabilities arising out of or based upon any such untrue statement or
omission made therein in reliance upon and in conformity with information
furnished to Lender by or on behalf of Owner or Borrower in connection with the
preparation of those portions of the Disclosure Document pertaining to Owner or
Borrower, Manager, the Collateral Property or the Loan or in connection with the
underwriting of the debt including financial statements of Owner and Borrower,
operating statements, rent rolls and other Required Records, environmental site
assessment reports and property condition reports with respect to the Collateral
Property. The foregoing indemnity will be in addition to any liability which
Owner or Borrower may otherwise have. Lender shall give Borrower a copy of any
Disclosure Document that is to be subject to the foregoing indemnification
obligations a reasonable amount of time prior to its delivery to potential
investors pursuant to an offering.
10.1.4 Owner's and Borrower's Indemnity Regarding Filings. In
connection with filings under the Exchange Act, Owner and Borrower shall (i)
indemnify Lender, the UBS Group and the Underwriter Group for any Liabilities to
which Lender, the UBS Group or the Underwriter Group may become subject insofar
as the Liabilities arise out of or are based upon
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the omission or alleged omission to state in the Provided Information or
Required Records a material fact required to be stated in the Provided
Information or Required Records in order to make the statements in the Provided
Information or Required Records, in light of the circumstances under which they
were made not misleading and (ii) reimburse Lender, the UBS Group or the
Underwriter Group for any legal or other expenses reasonably incurred by Lender,
UBS Group or the Underwriter Group in connection with defending or investigating
the Liabilities.
10.1.5 Indemnification Procedure. Promptly after receipt by an
indemnified party under Section 10.1.3 or 10.1.4 of notice of the commencement
of any action for which a claim for indemnification is to be made against Owner
or Borrower, such indemnified party shall notify Borrower in writing of such
commencement, but the omission to so notify the Owner and Borrower will not
relieve Owner or Borrower from any liability that it may have to any indemnified
party hereunder except to the extent that failure to notify causes prejudice to
Owner or Borrower. In the event that any action is brought against any
indemnified party, and it notifies Owner and Borrower of the commencement
thereof, Owner and Borrower will be entitled, jointly with any other
indemnifying party, to participate therein and, to the extent that it (or they)
may elect by written notice delivered to the indemnified party promptly after
receiving the aforesaid notice of commencement, to assume the defense thereof
with counsel satisfactory to such indemnified party in its sole discretion.
After notice from Owner and Borrower to such indemnified party under this
Section 10.1.5, neither Owner nor Borrower shall be responsible for any legal or
other expenses subsequently incurred by such indemnified party in connection
with the defense thereof other than reasonable costs of investigation; provided,
however, if the defendants in any such action include both Owner and Borrower
and an indemnified party, and any indemnified party shall have reasonably
concluded that there are any legal defenses available to it and/or other
indemnified parties that are different from or additional to those available to
Owner and Borrower, then the indemnified party or parties shall have the right
to select separate counsel to assert such legal defenses and to otherwise
participate in the defense of such action on behalf of such indemnified party or
parties. Owner and Borrower shall be liable for the expenses of more than one
separate counsel unless there are legal defenses available to it that are
different from or additional to those available to another indemnified party.
10.1.6 Contribution. In order to provide for just and equitable
contribution in circumstances in which the indemnity agreement provided for in
Section 10.1.3 or 10.1.4 is for any reason held to be unenforceable by an
indemnified party in respect of any Liabilities (or action in respect thereof)
referred to therein which would otherwise be indemnifiable under Section 10.1.3
or 10.1.4, Owner and Borrower shall contribute to the amount paid or payable by
the indemnified party as a result of such Liabilities (or action in respect
thereof); provided, however, that no Person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act)
shall be entitled to contribution from any Person not guilty of such fraudulent
misrepresentation. In determining the amount of contribution to which the
respective parties are entitled, the following factors shall be considered: (i)
the UBS Group's and Owner's and/or Borrower's relative knowledge and access to
information concerning the matter with respect to which the claim was asserted;
(ii) the opportunity to correct and prevent any statement or omission; and (iii)
any other equitable considerations appropriate in the circumstances. Lender and
each of Owner and Borrower hereby agree that it may not be equitable if the
amount of such contribution were determined by pro rata or per capita
allocation.
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XI MISCELLANEOUS
11.1 Exculpation.
(a) Subject to the qualifications below and the Guaranty, Lender
shall not enforce the liability and obligation of Owner or Borrower to perform
and observe the obligations contained in the Loan Documents by any action or
proceeding wherein a money judgment shall be sought against Owner or Borrower,
except that Lender may bring a foreclosure action, an action for specific
performance or any other appropriate action or proceeding to enable Lender to
enforce and realize upon its interest and rights under the Loan Documents, or in
the Collateral Property, the Rents or any other collateral given to Lender
pursuant to the Loan Documents; provided, however, that, except as specifically
provided herein, any judgment in any such action or proceeding shall be
enforceable against Owner or Borrower only to the extent of Owner's or
Borrower's interest in the Collateral Property, in the Rents and in any other
collateral given to Lender, and Lender shall not ▇▇▇ for, seek or demand any
deficiency judgment against Owner or Borrower in any such action or proceeding
under or by reason of or under or in connection with any Loan Document. The
provisions of this section shall not, however, (i) constitute a waiver, release
or impairment of any obligation evidenced or secured by any Loan Document; (ii)
impair the right of Lender to name Owner or Borrower as a party defendant in any
action or suit for foreclosure and sale under the Mortgage; (iii) affect the
validity or enforceability of any of the Loan Documents (including, without
limitation, the Guaranty) or any other guaranty made in connection with the Loan
or any of the rights and remedies of Lender thereunder, (iv) impair the right of
Lender to obtain the appointment of a receiver, (v) impair the enforcement of
the Assignment of Leases; (vi) constitute a prohibition against Lender to
commence any other appropriate action or proceeding in order for Lender to fully
realize the security granted by the Mortgage or to exercise its remedies against
the Collateral Property; or (vii) constitute a waiver of the right of Lender to
enforce the liability and obligation of Owner or Borrower, by money judgment or
otherwise, to the extent of any loss, damage, cost, expense, liability, claim or
other obligation incurred by Lender (including attorneys' fees and costs
reasonably incurred) arising out of or in connection with the following: (a)
fraud or intentional misrepresentation by Owner or Borrower or any guarantor in
connection with the Loan; (b) the gross negligence or willful misconduct of
Owner or Borrower; (c) the breach of any representation, warranty, covenant or
indemnification in any Loan Document concerning Environmental Laws or Hazardous
Substances, including Sections 5.1.32 and 6.10, and clauses (viii) through (xi)
of Section 6.16; (d) physical waste or after an Event of Default, the removal or
disposal of any portion of the Collateral Property; (e) the misapplication or
conversion by Owner or Borrower of (x) any Proceeds paid by reason of any
Insured Casualty, (y) any Award received in connection with a Condemnation, or
(z) any Rents, refunds of Taxes or Other Charges or Funds (i.e., use of Rents or
refunds of Taxes or Other Charges or Funds to make distributions or payments to
members/partners/shareholders of Owner or Borrower during the continuance of an
Event of Default); (f) failure to pay charges for labor or materials or other
charges that can create Liens on any portion of the Collateral Property unless
such charges are the subject of a bona fide dispute in which the Owner or
Borrower is contesting the amount or validity thereof, (g) any security deposits
collected with respect to the Collateral Property which are not delivered to
Lender upon a foreclosure of the Mortgage or action in lieu thereof, except to
the extent any such security deposits were applied in accordance with the terms
and conditions of any of the Leases prior to the occurrence of the Event of
Default that gave rise to such foreclosure or action in lieu thereof;
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and (h) Owner's and Borrower's indemnifications of Lender set forth in Sections
10.1.3 and 10.1.4.
(b) Notwithstanding anything to the contrary in this Agreement or
any of the Loan Documents, (A) Lender shall not be deemed to have waived any
right which Lender may have under Section 506(a), 506(b), 1111(b) or any other
provisions of the U.S. Bankruptcy Code to file a claim for the full amount of
the Debt or to require that all collateral shall continue to secure all of the
Debt in accordance with the Loan Documents, and (B) the Debt shall be fully
recourse to Owner and Borrower in the event that (1) Owner, Borrower or any
Person owning an interest (directly or indirectly) in Owner or Borrower
commences any action, suit, claim, arbitration, governmental investigation or
other proceeding (x) under any existing or future law of any jurisdiction,
domestic or foreign, relating to bankruptcy, insolvency, reorganization or
relief of debtors seeking to have an order for relief entered with respect to
Owner or Borrower, or seeking to adjudicate Owner or Borrower a bankrupt or
insolvent, or seeking reorganization, arrangement, adjustment, winding-up,
liquidation, dissolution, composition or other relief with respect to Owner or
Borrower or any of Owner's or Borrower's debts, or (y) seeking appointment of a
receiver (other than Owner seeking the appointment of a receiver during the
pendency of a foreclosure action against Owner commenced by Lender), trustee,
custodian or other similar official for Owner or Borrower or for all or
substantially all of any of Owner's or Borrower's assets or (2) Owner or
Borrower ever ceases to be a Special Purpose Entity.
11.2 Notices. All notices, consents, approvals and requests required or
permitted hereunder or under any other Loan Document (a "notice") shall be given
in writing and shall be effective for all purposes if hand delivered or sent (i)
by (a) certified or registered United States mail, postage prepaid, or (ii) by
(A) expedited prepaid delivery service, either commercial or United States
Postal Service, with proof of attempted delivery, and (B) by telecopier (with
answer back acknowledged), in any case addressed as follows (or to such other
address or Person as a party shall designate 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):
If to Lender: UBS Principal Finance LLC
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇-▇▇▇▇▇▇
Facsimile No. (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to: Cadwalader, ▇▇▇▇▇▇▇▇▇▇ & ▇▇▇▇
▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq.
Facsimile No. (▇▇▇) ▇▇▇-▇▇▇▇
If to Borrower: c/o Westfield Corporation, Inc.
and/or Owner ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇▇▇▇
Facsimile No. (▇▇▇) ▇▇▇-▇▇▇▇
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With a copy to: Debevoise & ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇, Esq.
Facsimile No. (▇▇▇) ▇▇▇-▇▇▇▇
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; or in the case of
expedited prepaid delivery and telecopy, upon the first attempted delivery on a
Business Day.
11.2.1 Owner's Representative; Borrower's Representative.
(a) Each of Owner Representative and Borrower Representative shall
notify Lender of the names of its officers and employees authorized to request
and take other actions on behalf of Owner and Borrower, respectively, (each a
"Responsible Officer") and shall provide Lender with a specimen signature of
each such officer or employee. Lender shall be entitled to rely conclusively on
a Responsible Officer's authority to give and receive notices and take other all
other actions of any kind on behalf of Borrower or any of them until Lender
receives written notice to the contrary. Lender shall have no duty to verify the
authenticity of the signature appearing on any notice.
(b) EACH OF OWNER AND BORROWER DOES HEREBY DESIGNATE AND APPOINT CT
CORPORATION SYSTEM AT ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, 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 OWNER OR
BORROWER MAILED OR DELIVERED TO OWNER OR BORROWER IN THE MANNER PROVIDED HEREIN
SHALL BE DEEMED IN EVERY RESPECT EFFECTIVE SERVICE OF PROCESS UPON OWNER AND
BORROWER, IN ANY SUCH SUIT, ACTION OR PROCEEDING IN THE STATE OF NEW YORK. EACH
OF OWNER AND BORROWER (1) SHALL GIVE PROMPT NOTICE TO LENDER OF ANY CHANGED
ADDRESS OF ITS AUTHORIZED AGENT HEREUNDER, (II) MAY AT ANY TIME AND FROM TIME TO
TIME DESIGNATE A SUBSTITUTE AUTHORIZED AGENT WITH AN OFFICE IN NEW YORK, NEW
YORK (WHICH 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.
11.3 Brokers and Financial Advisors. Each of Owner and Borrower hereby
represents that it has dealt with no financial advisors, brokers, underwriters,
placement agents, agents or finders in connection with the Loan. Owner, Borrower
and Lender shall indemnify and hold the other harmless 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
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behalf of the indemnifying party in connection with the transactions
contemplated herein. The provisions of this Section 11.3 shall survive the
expiration and termination of this Agreement and the repayment of the Debt.
11.4 Retention of Servicer. Lender reserves the right to retain the
Servicer to act as its agent hereunder with such powers as are specifically
delegated to the Servicer by Lender, whether pursuant to the terms of this
Agreement, any Pooling and Servicing Agreement or similar agreement entered into
as a result of a Secondary Market Transaction, the Cash Management Agreement or
otherwise, together with such other powers as are reasonably incidental thereto.
Borrower shall pay any reasonable fees and expenses of the Servicer in
connection with a release of the Collateral Property, assumption or modification
of the Loan, enforcement of the Loan Documents or any other action taken by
Servicer hereunder on behalf of Lender.
11.5 Survival. This Agreement and all covenants, agreements,
representations and warranties made herein and in the certificates delivered
pursuant hereto shall survive the making by Lender of the Loan and the execution
and delivery to Lender of the Note, and shall continue in full force and effect
so long as any of the Debt is unpaid unless a longer period is expressly set
forth herein or in the other Loan Documents. Each of Owner's and Borrower's
covenants and agreements in this Agreement shall inure to the benefit of the
respective legal representatives, successors and assigns of Lender.
11.6 Lender's Discretion. Whenever pursuant to this Agreement or any other
Loan Document, Lender exercises any right given to it to approve or disapprove,
or any arrangement or term is to be satisfactory to Lender, the decision of
Lender to approve or disapprove or to decide whether arrangements or terms are
satisfactory or not satisfactory shall (except as is otherwise specifically
herein provided) be in the sole discretion of Lender and shall be final and
conclusive.
11.7 Governing Law; Venue.
(a) THIS AGREEMENT WAS MADE BY LENDER AND ACCEPTED BY OWNER AND
BORROWER IN THE STATE OF NEW YORK, AND THE PROCEEDS OF THE NOTE DELIVERED
PURSUANT HERETO WERE DISBURSED FROM THE STATE OF NEW YORK, WHICH STATE THE
PARTIES AGREE HAS A SUBSTANTIAL RELATIONSHIP TO THE PARTIES AND TO THE
UNDERLYING TRANSACTION EMBODIED HEREBY, AND IN ALL RESPECTS, INCLUDING 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, EXCEPT THAT AT ALL
TIMES THE PROVISIONS FOR THE CREATION, PERFECTION, AND PROCEDURES RELATING TO
ENFORCEMENT OF THE LIENS CREATED PURSUANT TO THE LOAN DOCUMENTS SHALL BE
GOVERNED BY AND CONSTRUED ACCORDING TO THE LAW OF THE STATE IN WHICH THE
COLLATERAL PROPERTY IS LOCATED, IT BEING UNDERSTOOD THAT, TO THE FULLEST EXTENT
PERMITTED BY THE LAW OF
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SUCH STATE, THE LAW OF THE STATE OF NEW YORK SHALL GOVERN THE VALIDITY AND THE
ENFORCEABILITY OF ALL LOAN DOCUMENTS AND THE DEBT. TO THE FULLEST EXTENT
PERMITTED BY LAW, EACH OF OWNER AND BORROWER HEREBY UNCONDITIONALLY AND
IRREVOCABLY WAIVES ANY CLAIM TO ASSERT THAT THE LAW OF ANY OTHER JURISDICTION
GOVERNS THIS AGREEMENT AND THE NOTE, AND THIS AGREEMENT AND THE NOTE SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK
PURSUANT TO ss. 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS LAW.
(b) ANY LEGAL SUIT, ACTION OR PROCEEDING AGAINST LENDER, OWNER OR
BORROWER ARISING OUT OF OR RELATING TO THIS AGREEMENT MAY BE INSTITUTED IN ANY
FEDERAL OR STATE COURT IN NEW YORK, NEW YORK, PURSUANT TO ss. 5-1402 OF THE NEW
YORK GENERAL OBLIGATIONS LAW, AND EACH OF OWNER AND BORROWER WAIVES ANY
OBJECTION WHICH IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY SUCH
SUIT, ACTION OR PROCEEDING, AND EACH OF OWNER AND BORROWER HEREBY IRREVOCABLY
SUBMITS TO THE JURISDICTION OF ANY SUCH COURT IN ANY SUIT, ACTION OR PROCEEDING.
11.8 Modification; Waiver in Writing. No modification, amendment,
extension, discharge, termination or waiver of any provision of this Agreement
or of any other Loan Document, nor consent to any departure by Owner or Borrower
therefrom, shall in any event be effective unless the same shall be in a writing
signed by the party against whom enforcement is sought, and then such waiver or
consent shall be effective only in the specific instance, and for the purpose,
for which given. Except as otherwise expressly provided herein, no notice to or
demand on Owner or Borrower shall entitle Owner or Borrower to any other or
future notice or demand in the same, similar or other circumstances.
11.9 Delay Not a Waiver. Neither any failure nor any delay on the part of
Lender in insisting upon strict performance of any term, condition, covenant or
agreement, or exercising any right, power, remedy or privilege hereunder, or
under any other Loan Document, shall operate as or constitute a waiver thereof,
nor shall a single or partial exercise thereof preclude any other future
exercise, or the exercise of any other right, power, remedy or privilege. In
particular, and not by way of limitation, by accepting payment after the due
date of any amount payable under any Loan Document, Lender shall not be deemed
to have waived any right either to require prompt payment when due of all other
amounts due under the Loan Documents, or to declare an Event of Default for
failure to effect prompt payment of any such other amount.
11.10 TRIAL BY JURY. OWNER, BORROWER AND LENDER HEREBY AGREE NOT TO ELECT
A TRIAL BY JURY OF ANY ISSUE TRIABLE OF RIGHT BY JURY, AND WAIVE ANY RIGHT TO
TRIAL BY JURY FULLY TO THE EXTENT THAT ANY SUCH RIGHT SHALL NOW OR HEREAFTER
EXIST WITH REGARD TO THE LOAN DOCUMENTS, OR ANY CLAIM, COUNTERCLAIM OR OTHER
ACTION ARISING IN CONNECTION THEREWITH. THIS WAIVER OF RIGHT TO TRIAL BY JURY IS
GIVEN KNOWINGLY AND VOLUNTARILY BY OWNER, BORROWER AND LENDER, AND IS INTENDED
TO ENCOMPASS INDIVIDUALLY EACH INSTANCE AND EACH ISSUE AS
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TO WHICH THE RIGHT TO A TRIAL BY JURY WOULD OTHERWISE ACCRUE. EITHER PARTY IS
HEREBY AUTHORIZED TO FILE A COPY OF THIS PARAGRAPH IN ANY PROCEEDING AS
CONCLUSIVE EVIDENCE OF THIS WAIVER BY THE OTHER.
11.11 Heading. The Section headings in this Agreement are included herein
for convenience of reference only and shall not constitute a part of this
Agreement for any other purpose.
11.12 Severability. Wherever possible, each provision of this Agreement
shall be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Agreement shall be prohibited by or
invalid under applicable law, such provision shall be ineffective to the extent
of such prohibition or invalidity, without invalidating the remainder of such
provision or the remaining provisions of this Agreement.
11.13 Preferences. To the extent Owner or Borrower makes a payment to
Lender, or Lender receives proceeds of any collateral, which is in whole or part
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 Debt or part thereof
intended to be satisfied shall be revived and continue in full force and effect,
as if such payment or proceeds had not been received by Lender. This provision
shall survive the expiration or termination of this Agreement and the repayment
of the Debt.
11.14 Waiver of Notice. Neither Owner nor Borrower shall be entitled to
any notices of any nature whatsoever from Lender except with respect to matters
for which this Agreement or any other Loan Document specifically and expressly
provides for the giving of notice by Lender to Owner or Borrower and except with
respect to matters for which Owner or Borrower is not, pursuant to applicable
Legal Requirements, permitted to waive the giving of notice. Each of Owner and
Borrower hereby expressly waives the right to receive any notice from Lender
with respect to any matter for which no Loan Document specifically and expressly
provides for the giving of notice by Lender to Owner or Borrower.
11.15 Remedies of Owner and Borrower. In the event that a claim or
adjudication is made that Lender or its agent, including Servicer, has acted
unreasonably or unreasonably delayed acting in any case where by law or under
any Loan Document, Lender or such agent, as the case may be, has an obligation
to act reasonably or promptly, each of Owner and Borrower agrees that neither
Lender nor its agents, including Servicer, shall be liable for any monetary
damages, and such Borrower's sole remedy shall be to commence an action seeking
injunctive relief or declaratory judgment. Any action or proceeding to
determines whether Lender has acted reasonably shall be determined by an action
seeking declaratory judgment. Each of Owner and Borrower specifically waives any
claim against Lender and its agents, including Servicer, with respect to actions
taken by Lender or its agents on Owner's or Borrower's behalf pursuant to
Section 9.2.5.
11.16 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
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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.
11.17 Offsets, Counterclaims and Defenses.
Each of Owner and Borrower hereby waives the right to assert a
counterclaim, other than a compulsory counterclaim, in any action or proceeding
brought against it by Lender or its agents, including Servicer. Any assignee of
Lender's interest in and to the Loan Documents shall take the same free and
clear of all offsets, counterclaims or defenses that are unrelated to the Loan
Documents which Owner or Borrower may otherwise have against any assignor of
such documents, and no such unrelated offset, counterclaim or defense shall be
interposed or asserted by Owner or 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 Owner or Borrower.
11.18 Publicity. All news releases, publicity or advertising by Owner or
Borrower or its Affiliates through any media intended to mach the general
public, which refers to the Loan Documents, the Loan, Lender, any member of the
UBS Group, a Loan purchaser, the Servicer or the trustee in a Secondary Market
Transaction, shall be subject to the prior written approval of Lender.
11.19 No Usury. Owner, Borrower and Lender intend at all times to comply
with applicable state law or applicable United States federal law (to the extent
that it permits Lender to contract for, charge, take, reserve or receive a
greater amount of interest than under state law) and that this Section 11.19
shall control every other agreement in the Loan Documents. If the applicable law
(state or federal) is ever judicially interpreted so as to render usurious any
amount called for under the Note or any other Loan Document, or contracted for,
charged, taken, reserved or received with respect to the Debt, or if Lender's
exercise of the option to accelerate the maturity of the Loan or any prepayment
by Owner or Borrower results in Owner and Borrower having paid any interest in
excess of that permitted by applicable law, then it is Owner's, Borrower's and
Lender's express intent that all excess amounts theretofore collected by Lender
shall be credited against the unpaid Principal and all other Debt (or, if the
Debt has been or would thereby be paid in full, refunded to the Borrower), and
the provisions of the Loan Documents immediately be deemed reformed and the
amounts thereafter collectible thereunder reduced, without the necessity of the
execution of any new document, so as to comply with the applicable law, but so
as to permit the recovery of the fullest amount otherwise called for thereunder.
All sums paid or agreed to be paid to Lender for the use, forbearance or
detention of the Loan shall, to the extent permitted by applicable law, be
amortized, prorated, allocated, and spread throughout the full stated term of
the Loan until payment in full so that the rate or amount of interest on account
of the Debt does not exceed the maximum lawful rate from time to time in effect
and applicable to the Debt for so long as the Debt is outstanding.
Notwithstanding anything to the contrary contained in any Loan Document, it is
not the intention of Lender to accelerate the maturity of any interest that has
not accrued at the time of such acceleration or to collect unearned interest at
the time of such acceleration.
11.20 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
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Agreement shall control. The parties hereto acknowledge that each is represented
by separate counsel in connection with the negotiation and drafting of the Loan
Documents and that the Loan Documents shall not be subject to the principle of
construing their meaning against the party that drafted them.
11.21 No Joint Venture or Partnership; No Third Party Beneficiaries. (a)
Owner, Borrower and Lender intend that the relationships created hereunder and
under the other Loan Documents be solely that of borrower and lender. Nothing
herein or therein is intended to create a joint venture, partnership,
tenancy-in-common, or joint tenancy relationship between Owner, Borrower and
Lender nor to grant Lender any interest in the Collateral Property other than
that of mortgagee, beneficiary or lender.
(b) This Agreement and the other Loan Documents are solely for the
benefit of Lender, Owner and Borrower and nothing contained in this Agreement or
the other Loan Documents shall be deemed to confer upon anyone other than
Lender, Owner and Borrower any right to insist upon or to enforce the
performance or observance of any of the obligations contained herein or therein.
All conditions to the obligations of Lender to make the Loan hereunder are
imposed solely and exclusively for the benefit of Lender and no other Person
shall have standing to require satisfaction of such conditions in accordance
with their terms or be entitled to assume that Lender will refuse to make the
Loan in the absence of strict compliance with any or all thereof and no other
Person shall under any circumstances be deemed to be a beneficiary of such
conditions, any or all of which may be freely waived in whole or in part by
Lender if, in Lender's sole discretion, Lender deems it advisable or desirable
to do so.
11.22 Yield Maintenance Premium. Each of Owner and Borrower acknowledges
that Lender intends to enter into a Secondary Market Transaction which may
result in various classes of Securities with different coupon rates. Each of
Owner and Borrower also acknowledges that (i) the proceeds of any partial
prepayment of Principal may be utilized to retire Securities bearing a coupon
rate lower than the Interest Rate, (ii) that following such prepayment the
remaining outstanding Securities may bear a weighted average coupon rate in
excess of the Interest Rate and (iii) that, absent the Yield Maintenance Premium
payable hereunder in connection with such prepayment, Lender will not receive
the benefits intended to be conferred by the Loan Documents. For these reasons,
and to induce Lender to make the Loan, Borrower expressly waives any right or
privilege to prepay the Loan except as may be specifically permitted herein and
agrees that, except as expressly provided for herein, any prepayments, whether
voluntary or involuntary, will be accompanied by the Yield Maintenance Premium.
Such Yield Maintenance Premium shall be required whether payment is made by
Borrower, by Owner, by a Person on behalf of Borrower, or by the purchaser at
any foreclosure sale, and may be included in any bid by Lender at such sale.
Each of Owner and Borrower further acknowledges that (A) it is a knowledgeable
real estate developer and/or investor; (B) it fully understands the effect of
the provisions of this Section 11.22, as well the other provisions of the Loan
Documents; (C) the making of the Loan by Lender at the Applicable Interest Rate
and other terms set forth in the Loan Documents are sufficient consideration for
such Borrower's obligation to pay a Yield Maintenance Premium (if required); and
(D) Lender would not make the Loan on the terms set forth herein without the
inclusion of such provisions. Borrower also acknowledges that the provisions of
this Agreement limiting the right of prepayment and providing for the payment of
the Yield Maintenance Premium and other charges specified herein were
independently
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negotiated and bargained for, and constitute a specific material part of the
consideration given by Borrower to Lender for the making of the Loan.
11.23 Assignment. The Loan, the Note, the Loan Documents and all Lender's
rights, title, obligations and interests therein may be assigned by Lender at
any time in its sole discretion whether by operation of law (pursuant to a
merger or other successor in interest) or otherwise. Upon such assignment, all
references to Lender in this Loan Agreement and in any Loan Document shall be
deemed to refer to such assignee or successor in interest and such assignee or
successor in interest shall thereafter stand in the place of Lender; provided,
however that the original named Lender herein shall not be released of its
obligations in respect of Advances which Lender is thereafter required to make
hereunder. Neither Owner nor Borrower may assign its rights, interests or
obligations under this Loan Agreement or under any of the Loan Documents except
as expressly permitted hereunder.
11.24 Waiver of Marshalling of Assets.
(a) To the fullest extent permitted by law, each of Owner and
Borrower, for itself and its successors and assigns, waives all rights to a
marshalling of the assets of each of Owner and Borrower, each of Owner's and
Borrower's partners or members and others with interests in any of Owner or
Borrower, and of the Collateral Property, or to a sale in inverse order of
alienation in the event of foreclosure of the Mortgage, and agrees not to assert
any right under any laws pertaining to the marshalling of assets, the sale in
inverse order of alienation, homestead exemption, the administration of estates
of decedents, or any other matters whatsoever to defeat, reduce or affect the
right of Lender under the Loan Documents to a sale of the Collateral Property
for the collection of the Debt without any prior or different resort for
collection or of the right of Lender to the payment of the Debt out of the net
proceeds of the Collateral Property in preference to every other claimant
whatsoever.
11.25 Joint and Several Liability. Each of Owner and Borrower shall be
jointly and severally liable with each other for payment of all amounts that
become due under this Agreement, such as payment of all fees and expenses
pursuant to Section 6.15.
[SIGNATURE PAGES IMMEDIATELY FOLLOW]
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IN WITNESS WHEREOF, the parties hereto have caused this Loan Agreement to
be duly executed by their duly authorized representatives, all as of the day and
year first above written.
WITNESS/ATTEST BORROWER:
ANNAPOLIS SHOPPINGTOWN LLC,
a Delaware limited liability company
By: Annapolis Mall Limited Partnership,
a Maryland limited partnership,
its sole member
By: Annapolis Mall LLC,
a Delaware limited liability company,
its general partner
By: Annapolis Manager LLC,
a Delaware limited liability company,
its managing member
By: Westfield America Limited Partnership,
a Delaware limited partnership,
its sole member
By: Westfield America, Inc.,
a Missouri corporation,
its general partner
/s/ ▇▇▇▇ ▇. ▇▇▇▇▇ By: /s/ ▇▇▇ ▇▇▇▇▇▇
--------------------- ------------------
Name: ▇▇▇ ▇▇▇▇▇▇
Title: Secretary
[Signatures Continue on Next Page]
WITNESS/ATTEST OWNER:
ANNAPOLIS MALL LIMITED PARTNERSHIP,
a Maryland limited partnership
By: Annapolis Mall LLC,
a Delaware limited liability company,
its general partner
By: Annapolis Manager LLC,
a Delaware limited liability company,
its managing member
By: Westfield America Limited Partnership,
a Delaware limited partnership,
its sole member
By: Westfield America, Inc.,
a Missouri corporation,
its general partner
/s/ ▇▇▇▇ ▇. ▇▇▇▇▇ By: /s/ ▇▇▇ ▇▇▇▇▇▇
-------------------- ----------------------
Name: ▇▇▇ ▇▇▇▇▇▇
Title: Secretary
[Signatures Continue on Next Page]
WITNESS/ATTEST OWNER:
ANNAPOLIS LAND LLC,
a Delaware limited liability company
By: Annapolis Mall Limited Partnership,
a Maryland limited partnership,
its sole member
By: Annapolis Mall LLC,
a Delaware limited liability company,
its general partner
By: Annapolis Manager LLC,
a Delaware limited liability company,
its managing member
By: Westfield America Limited Partnership,
a Delaware limited partnership,
its sole member
By: Westfield America, Inc.,
a Missouri corporation,
its general partner
/s/ ▇▇▇▇ ▇. ▇▇▇▇▇ By: /s/ ▇▇▇ ▇▇▇▇▇▇
----------------------- ----------------------
Name: ▇▇▇ ▇▇▇▇▇▇
Title: Secretary
[Signatures Continue on Next Page]
LENDER:
UBS PRINCIPAL FINANCE LLC, a Delaware limited
liability company
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇▇
------------------------
Name: ▇▇▇▇ ▇▇▇▇▇▇▇
Title: Executive Director
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇
------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇
Title: Executive Director
Exhibit A
Form of Notice To Tenants
[BORROWER'S NAME AND ADDRESS]
_____________, 2000
[Name and Address of Tenant]
Re: Lease of Store at
(the "Center")
Ladies and Gentlemen:
The undersigned is the Owner of the Center and the landlord under
your lease of a store at the Center (your "Lease").
By this letter, you are hereby directed (1) to make all checks, in
payment of rent and other sums due to the landlord under your Lease, payable to
the order of [applicable Agent], and (2) to deliver such checks or otherwise
make such payments to the following address:
[Name and Address of Agent]
The foregoing direction is irrevocable, except with the written
consent of our mortgagee, UBS Principal Finance LLC (or its successors or
assigns), notwithstanding any future contrary request or direction from the
undersigned or any other person (other than UBS Principal Finance LLC (or its
successors or assigns)). Thank you for your cooperation.
Very truly yours,
[BORROWER]
By: ________________________________________
Name: _______________________________
Title: ______________________________
A - 1
Exhibit B
Form of Subordination, Nondisturbance and Attornment Agreement
NON-DISTURBANCE AND ATTORNMENT AGREEMENT
This Non-Disturbance and Attornment Agreement (this Agreement), made as of
___________, 199_, by and between , a limited
liability company organized under the laws of Delaware and having an address at
(the Lender) and _________________, a
_________________, having an address at _______________________ (the Tenant);
WITNESSETH:
WHEREAS, by the lease (as the same may be amended from time to time, the
Lease) dated _________, 19__, between _______________ (the Landlord), as
landlord, and Tenant, as tenant, the Landlord leased to Tenant a certain portion
of the building known as and located at __________________, being more fully
described in said Lease (the Premises);
WHEREAS, the Landlord has executed and delivered to the Lender a mortgage
note in the original principal amount of ____________ ($____________) Dollars,
which note is secured by, among other things, a mortgage or deed of trust (which
mortgage or deed of trust, and all amendments, renewals, increases,
modifications, replacements, substitutions, extensions, spreaders, restatements
and consolidations thereof and all re-advances thereunder and additions thereto
is referred to as the Mortgage) encumbering certain land being more particularly
described in Schedule A attached hereto (the Land), together with the buildings
and other improvements located or to be located thereon (such buildings and
other improvements and the Land, collectively, the Mortgaged Property)
including, without limitation, the Premises.
NOW, THEREFORE, the parties hereto, in consideration of the covenants
contained herein, have agreed and hereby agree as follows:
1. The Lease, as the same may hereafter be modified, amended or
extended, is and shall be subject and subordinate in each and every respect to
the Mortgage, to all renewals,
B - 1
modifications, replacements and extensions thereof, to all terms, conditions and
provisions thereof and to each and every advance hertofore made or hereafter
made under the Mortgage.
2. The Lender agrees that if any action or proceeding is commenced
by the Lender for the foreclosure of the Mortgage or the sale of the Mortgaged
Property, the Tenant shall not be named as a party therein (unless required by
law), and the sale of the Mortgaged Property in any such action or proceeding
and the exercise by the Lender of any of its other rights under the Mortgage, or
under the note secured by the Mortgage, shall be made subject to all rights of
the Tenant under the Lease, provided that at the time of the commencement of any
such action or proceeding and at the time of any such sale or exercise of any
such other rights, the Tenant shall not be in default under any of the terms,
covenants or conditions of the Lease or of this Agreement on the Tenant's part
to be observed or performed.
3. The Tenant shall concurrently give the Lender copies of all
notices and other communications given by the Tenant to the Landlord relating to
(i) defaults or alleged defaults on the part of the Landlord or the Tenant under
the Lease, (ii) any violations of any ordinances, statues, laws, rules, codes
regulations or requirements of any governmental agency, and (iii) any assignment
or subletting of all or any portion of the Premises.
4. In the event of any act or omission by the Landlord which would
give the Tenant the right, either immediately or after the lapse of a period of
time, to terminate the Lease, or to claim a partial or total eviction, the
Tenant will not exercise any such right (i) until it has sent written notice of
such act or omission to the Lender as provided herein, and (ii) unless the
Lender shall have failed within sixty (60) days after receipt of such notice to
cure such default or, if such default is not reasonably susceptible of cure
within such sixty (60) days, the Lender shall not have commenced the cure of
such default within sixty (60) days of receipt of such notice and thereafter
diligently pursued such action.
5. In the event that the interest of the Landlord is transferred by
reason of, or assigned in lieu of foreclosure or other proceedings for
enforcement of the Mortgage, then, subject to the provisions of this Agreement,
the Lease shall nevertheless continue in full force and effect and, upon the
written request of the Lender, the Tenant shall attorn to the Lender and shall
recognize the Lender as its landlord. Although the foregoing provision shall be
self-operative, in order to confirm such attornment, upon the request of the
Lender, the Tenant shall execute and deliver to the Lender (i) an agreement of
attornment in form and content reasonably satisfactory to the Lender, at the
Tenant's sole cost and expense, confirming the foregoing attornment and agreeing
to perform all the terms, covenants and conditions of the Lease on the Tenant's
part to be performed for the benefit of such Lender with the same force and
effect as if such Lender were the Landlord originally named in this Lease or
(ii) a new lease with the
B - 2
Lender, as landlord, for the remaining term of the Lease and otherwise on the
same terms and conditions and with the same options, if any, then remaining.
Nothing herein contained shall be construed however, to obligate the Lender to
cure any default by the Landlord under the Lease occurring prior to any date on
which the Lender shall succeed to the rights of the Landlord, it being expressly
agreed that under no circumstances shall the Lender be obligated to remedy any
such default.
6. If the Lender shall succeed to the interest of the Landlord, the
Lender shall have no personal liability as successor to the Landlord, and the
Tenant shall look only to the estate and property of the Lender in the Mortgaged
Property or the proceeds thereof for the satisfaction of the Tenant's remedies
for the collection of a judgement (or other judicial process) requiring the
payment or money in the event of any default by the Lender as landlord under the
Lease. In addition, the Lender as holder of the Mortgage or as landlord under
the Lease if it succeeds to that position, shall in no event (i) be liable to
the Tenant for any act or omission of any prior landlord, (ii) be subject to
any offset or defense which the Tenant might have against any prior landlord,
(iii) be liable to the Tenant for any liability or obligation of any prior
landlord occurring prior to the date that the Lender or any subsequent owner
acquires title to the Premises, or (iv) be liable to the Tenant for any security
or other deposits given to secure the performance of the Tenant's obligations
under the Lease, except to the extent that the Lender shall have acknowledged
actual receipt of such security or other deposits in writing. No other property
or assets of the Lender shall be subject to levy, execution or other enforcement
procedure for the satisfaction of the Tenant's remedies under or with respect to
the Lease, the relationship of the landlord and the tenant thereunder or the
Tenant's use or occupancy of the Premises.
7. All notices and other communications hereunder shall be sent by
certified or registered mail (postage prepaid, return receipt requested) to the
Lender at the address set forth above, Attention: _________, or to the Tenant at
the address set forth in the Lease, or to such other address or person as may be
specified in a notice sent in accordance with the provisions of this Section 7,
and shall be deemed given when received at the addresses specified above.
8. No prepayment of rent or additional rent due under the Lease of
more than one month in advance shall be binding upon the Lender, as holder of
the Mortgage or as landlord under the Lease if the Lender succeeds to that
position, unless consented to by the Lender, and from and after the date hereof,
no amendment, modification, surrender or cancellation of the Lease shall be
binding upon the Lender, as holder of the Mortgage or as landlord under the
Lease if the Lender succeeds to that position, unless such amendment,
modification, surrender or cancellation is done in compliance with the terms of
the Mortgage.
B - 3
9. This Agreement shall apply to, bind and inure to the benefit of
the parties hereto and their respective successors and assigns. As used herein,
the term Tenant shall mean and include the present tenant under the Lease, any
permitted subtenant under the Lease, any permitted assignee of the Lease and any
successor of any of them. The term Lender as used herein shall include the
holder of the Mortgage, the successors and assigns of the Lender, and any
person, party or entity which shall become the owner of the Mortgaged Property
by reason of a foreclosure of the Mortgage or the acceptance of a deed or
assignment in lieu of foreclosure or other proceedings for enforcement of the
Mortgage or otherwise. The term Landlord as used herein shall mean and include
the present landlord under the Lease and such landlord's predecessors and
successors in interest under the Lease.
10. This Agreement may not be modified in any manner or terminated
except by an instrument in writing executed by the parties hereto.
[11. This Agreement satisfies the condition to the subordination of
the Lease to the Mortgage set forth in Section _____ of the Lease with respect
to the execution and delivery of ____.]
12. This Agreement shall be governed by and construed in accordance
with the laws of the State of ____________.
13. Both the Tenant and the Lender hereby irrevocably waive all
right to trial by jury in any action, proceeding or counterclaim arising out of
or relating to the Lease or this Agreement.
B - 4
IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement
as of the day and year first above written.
By:
--------------------------------
Name:
Title:
[TENANT]
By:
--------------------------------
Name:
Title:
B - 5
EXHIBIT C-1
Form of Manager Consent and Subordination
(Manager other than Westfield)
CONSENT AND SUBORDINATION OF MANAGER
----------
UBS Principal Finance
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
Reference is made to (i) that certain Management Agreement (the
"Management Agreement"), dated as of _______________, between
______________________ (the "Borrower") and the undersigned (the "Manager") with
respect to the property known as __________________ and located in the City of
_____________ County, _________ (the "Property"), and (ii) that certain Loan
Agreement (the "Loan Agreement") dated as of ______________, 199_, between the
Borrower and (together with its successors and assigns, the
"Lender"). Any capitalized terms used herein but not defined herein shall have
the same meanings as are ascribed to them in the Loan Agreement.
The Manager acknowledges and understands that delivery of this letter to
you is a condition to the Lender making a certain loan to the Borrower pursuant
to the Loan Agreement in the original principal amount of up to $___________
(the "Loan").
The Borrower and the Manager hereby agree as follows:
1. The Management Agreement is and shall be subject and subordinate in all
respects to (i) the Mortgage (and to the lien of the Mortgage), (ii) the Loan
Documents, and (iii) any and all modifications, amendments, renewals and/or
substitutions of the Mortgage and/or any of the other Loan Documents. This
paragraph 1 shall be self-operative and no further instrument of
C-1-1
subordination shall be required. If requested, however, the Borrower and/or the
Manager shall execute and deliver such further instruments as the Lender may
deem reasonably necessary to effectuate this subordination.
2. If there shall have occurred and be continuing an Event of Default and
the Lender shall have obtained (i) title to the Property (or any portion
thereof) whether by foreclosure, deed-in-lieu of foreclosure, bankruptcy sale or
otherwise and/or (ii) possession of the Property (or any portion thereof)
whether personally or through an agent, a receiver or a trustee, the Manager
shall, if and to the extent requested in writing by the Lender, continue
performance under the Management Agreement in accordance with the terms thereof
so long as the Manager is paid compensation thereafter accruing under the
Management Agreement. The Borrower and the Manager understand, however, that
nothing contained herein, in the Mortgage or in any of the other Loan Documents
shall be construed to obligate the Lender to perform or discharge any of the
Borrower's obligations, duties or liabilities under the Management Agreement.
3. Upon the occurrence of any default by the Borrower under the terms of
the Management Agreement, the Manager shall, promptly upon becoming aware
thereof, provide the Lender with notice in writing thereof, and after receipt of
said notice, the Lender shall have the same time period within which to cure
said default as the Borrower has under the Management Agreement although the
Borrower and the Manager understand that the Lender shall not have any
obligation to do so. Notwithstanding the foregoing, the failure by the Manager
to notify the Lender of a default under the Management Agreement shall not be
deemed to constitute a waiver by the Manager of such default. Furthermore, the
Borrower and the Manager agree that the Lender may terminate the Management
Agreement (i) in accordance with Section of the Loan Agreement or in the event
of the Manager's gross negligence, malfeasance or willful misconduct(1), or (ii)
by giving five days' notice to the Manager upon the Lender (or a successor
owner, as the case may be) obtaining (A) title to the Property (or any portion
thereof) whether by foreclosure, deed-in-lieu of foreclosure, bankruptcy sale or
otherwise, and/or (B) possession of the Property (or any portion thereof)
whether personally or through an agent, a receiver or a trustee. If the Lender
elects to terminate the Management Agreement in accordance with this Paragraph
3, the Borrower and the Manager understand and agree that the Manager shall look
solely to the Borrower for any and all fees, charges or other sums payable to
the Manager under the Management Agreement. If the Management Agreement shall be
so terminated by the Lender, the Manager agrees to cooperate with the Lender to
ensure a smooth transition to the new property manager.
----------
(1) The Management Agreement must permit the Borrower to terminate the
Management Agreement in the event of the Manager's gross negligence,
malfeasance or willful misconduct.
C-1-2
4. The Manager hereby confirms that (i) the term of the Management
Agreement shall expire on or before the Anticipated Prepayment Date, and (ii) if
the Debt has not been repaid in full on or before the Anticipated Prepayment
Date, the term of the Management Agreement may only be renewed or extended
beyond the Anticipated Prepayment Date with the prior written approval of the
Servicer.(2)
5. This letter shall inure to the benefit of the Lender and its successors
and assigns, including the trustee in a Secondary Market Transaction. In the
event of any inconsistency or conflict with the provisions of this letter and
the provisions of the Management Agreement, the provisions of this letter shall
control.
6. The Manager agrees that it shall not change, amend, modify or terminate
the Management Agreement without the Lender's prior written approval in each
instance, which approval may be given or denied by the Lender in its sole
discretion. If the Manager does so amend, modify or terminate the Management
Agreement without the Lender's prior written approval, such amendment,
modification or termination shall be void ab initio.
7. This letter shall be governed by, and construed in accordance with the
law of the State of New York.
8. Without limiting the generality of any other provisions contained
herein or in the other Loan Documents, no failure on the part of the Lender to
exercise, and no delay in exercising, any right hereunder or under any of the
other Loan Documents shall operate as a waiver thereof, nor shall any single or
partial exercise of any right preclude any other or further exercise thereof or
the exercise of any other right. The rights and remedies of the Lender provided
herein and in the other Loan Documents are cumulative and are in addition to,
and are not exclusive of, any rights or remedies provided by law or in equity.
9. The Manager represents and warrants to the Lender that as of the date
hereof (i) the Management Agreement is in full force and effect and has not been
amended, modified, assigned, terminated or supplemented, (ii) the Manager is not
in default under the provisions of the Management Agreement and there is no
condition which, with the giving of notice and/or the lapse of time, would
constitute such a default, and (iii) to the best of Manager's knowledge, the
Borrower is not in default under the provisions of the Management Agreement and
there is no condition which, with the giving of notice and/or the lapse of time,
would constitute such a default.
----------
(2) The Management Agreement must expire on or before the Anticipated
Prepayment Date and may not be renewed or extended without the prior
written approval of the Servicer.
C-1-3
10. This letter may not be amended, modified, terminated or supplemented
without the written approval of each of the Manager, the Borrower and the
Lender.
Very truly yours,
[MANAGER]
By: ________________________________
Name:
Title:
AGREED AND CONSENTED
TO AS OF _______________, 199_
[BORROWER]
By: ______________________, its _____________
By: ___________________________
Name:
Title:
C-1-4
Exhibit C-2
MANAGER'S CONSENT AND SUBORDINATION
OF MANAGEMENT AGREEMENT
THIS MANAGER'S CONSENT AND SUBORDINATION OF MANAGEMENT AGREEMENT
(this "Agreement"), dated as of , is executed by the undersigned,
WESTFIELD MANAGEMENT COMPANY, a Delaware general partnership ("Manager"), as an
inducement to UBS Principal Finance LLC, a Delaware limited liability company
(together with its successors and assigns, the "Lender"), to make a loan to
, a Delaware limited liability company ("Borrower") in a
principal amount not to exceed $16,840,000.00 (the "Loan") pursuant to that
certain Loan Agreement dated as of the date hereof (the "Loan Agreement"), in
connection with various properties, including the property owned by
(the "Property").
1. Definitions. All capitalized terms not defined herein shall have
the meanings ascribed thereto in the Loan Agreement.
2. Manager's Representations. Manager warrants and represents to
Lender, as of the date hereof, that the following are true and correct:
(a) That Manager has agreed to act as manager of the Property
pursuant to that certain management agreement, between Borrower and Manager,
which agreement is described on Exhibit A attached hereto and made a part
hereof, and has not been amended, modified or supplemented except as set forth
on said Exhibit A (the "Management Agreement").
(b) That the entire agreement between Manager and Borrower for the
management of the Property is evidenced by the Management Agreement.
(c) That the Management Agreement constitutes the valid and binding
agreement of Manager, is enforceable in accordance with its terms, and Manager
has full authority under all state or local laws and regulations, to perform all
of its obligations under said Management Agreement.
(d) That neither Borrower nor Manager is in default in the
performance of any of its obligations under the Management Agreement.
(e) That Manager has received and reviewed a copy of the Loan
Agreement and the Cash Management Agreement.
3. Manager's Agreements. Manager hereby consents to and agrees to
each and every one of the following covenants and agreements for the benefit of
Lender and as a condition to Lender's making the Loan:
(a) No Termination of Management Agreement. Manager shall not
terminate the Management Agreement without first obtaining Lender's written
consent, which consent shall not be unreasonably withheld, conditioned or
delayed.
C-2-1
Notwithstanding the foregoing, Manager shall have the right to terminate the
Management Agreement upon default by Borrower with respect to non-payment of the
management fee due thereunder by giving Lender thirty (30) days' prior written
notice of such termination. In the event Lender shall cure such non-payment
default in the aforesaid thirty (30)-day period, then any such termination
notice shall be of no further force or effect.
(b) Subordination of Management Agreement to Lien of Mortgages. Any
and all liens, rights and interests (whether ▇▇▇▇▇▇ or inchoate and including,
without limitation, all mechanics' and materialmen's liens under applicable law)
owned, claimed or held, or to be owned, claimed or held, by Manager in and to
the Property, other than rights of Manager to receive payment of the basic
management fee and all other amounts payable under the Management Agreement for
periods prior to the termination thereof, are and shall be, and are hereby made,
in all respects subordinate and inferior to the liens and security interests
created or to be created for the benefit of Lender, its successors and assigns,
and securing the repayment of the Debt and including, without limitation, those
created under and by virtue of the Mortgage.
(c) Lender's Right to Terminate. Upon the occurrence of a Cash
Management Event, Manager shall, at the request of Lender, continue performance,
subject to Paragraph 3(d) hereof, on behalf of Lender, of all of Manager's
obligations under the terms of the Management Agreement with respect to the
Property, provided that Lender gives Manager the notice provided for in
Paragraph 3(j) hereof and Lender (or Borrower) performs or causes to be
performed the obligations of Borrower to Manager under the Management Agreement
accruing or arising from and after, and with respect to the period commencing
upon, the effective date of such notice. Notwithstanding anything contained in
the Management Agreement to the contrary, Lender, or Borrower at Lender's
direction pursuant to the Loan Documents, shall have the right to terminate the
Management Agreement upon, or at any time after, Lender or any third party
acquires the Property, whether by foreclosure, deed-in-lieu of foreclosure or
otherwise, by giving Manager thirty (30) days' prior written notice of such
termination, in which event Manager shall resign as manager of the Property
effective upon the end of such thirty (30)-day period. Manager agrees not to
look to Lender for payment of any accrued but unpaid fees relating to the
Property accruing from and after the effective date of such termination.
(d) Cooperation with Management Consultant. If, pursuant to the Loan
Agreement, Borrower retains a Management Consultant, Manager shall cooperate
with the Management Consultant to enable the Management Consultant to perform
its responsibilities as described in the Loan Agreement.
(e) No Amendments to Management Agreement. Manager will not amend or
modify the Management Agreement in any manner which would (i) materially and
adversely affect the management, operation or value of the Property, or (ii)
increase the base management fee payable thereunder, without the prior written
consent of Lender which consent shall not be unreasonably withheld, delayed or
conditioned. In the event Manager fails to secure such approval, the Management
Agreement shall, for the
C-2-2
purposes of Manager's obligations to Lender pursuant to this Agreement,
including Manager's obligation aforesaid to continue performance thereunder for
Lender's benefit pursuant to the terms of this Agreement, be deemed not to have
been modified by such amendment.
(f) Delivery of Rent Roll and Service Contracts. Within twenty (20)
Business Days after Lender's request therefor, but not more than once in any
calendar quarter, and only to the extent not furnished by Borrower. Manager
shall furnish to Lender a current rent roll of all Tenants of the Property,
including a list of which Tenants are in default under their respective leases,
and a schedule of all other entities with whom Manager has entered into leases,
contracts or other agreements relating to the Property, together with copies of
all such leases, contracts or agreements.
(g) Further Assurances. Manager further agrees, without cost to
Manager, to (i) execute such affidavits and certificates as Lender shall
reasonably require to further evidence the agreements herein contained, (ii) on
request from Lender, and only to the extent not furnished by Borrower, furnish
Lender with copies of such information as Borrower is entitled to receive under
the Manager Agreement, and (iii) at reasonable times, and upon reasonable
advance notice, cooperate with Lender's representative or agent in any
inspection of the Property.
(h) Assignment of Rents and Leases. Manager acknowledges that, in
connection with the Loan, Borrower has executed and delivered to Lender an
Assignment of Leases and Rents, dated as of the date hereof, assigning to
Lender, among other things, all of Borrower's right, title and interest in and
to all of the Leases, including any of Borrower's rights in the security
deposits thereunder (to the extent permitted by applicable law). Manager hereby
agrees that as of the date hereof, Manager shall henceforth deliver to the
Lockbox Account, and cause all Tenants under Leases to deliver to the Lockbox
Account, for application in accordance with the terms and conditions of
the Loan Agreement, the Cash Management Agreement and the other Loan Documents,
all Rents and other proceeds received after the date hereof from any and all
Tenants or other parties occupying or using any portion of the Property.
(i) No Joint Venture. Lender has no obligation to Manager with
respect to the Debt and Manager shall not be a third party beneficiary with
respect to any of Lender's obligations to Borrower set forth in the Loan
Documents. The relationship of Lender to Borrower is one of a creditor to a
debtor, and Lender is not a joint venturer or partner of Borrower.
(j) Lender Not Obligated Under Management Agreement. Manager further
agrees that, except as hereinafter set forth, nothing herein shall impose upon
Lender any obligation for payment or performance in favor of Manager. In the
event that Lender notifies Manager in writing of the occurrence of a Cash
Management Event and that Lender has elected to assert the rights of Borrower
under the Management Agreement, Lender shall pay Manager the sums due Manager
under the terms of the Management Agreement (subject to and in accordance with
the terms of the Management Agreement and this Agreement) for the period
commencing on the effective date of
C-2-3
Lender's notice to Manager and ending on the expiration date or earlier
termination of the Management Agreement.
(k) Lender's Reliance on Representations. Manager has executed this
Agreement for the purpose of inducing the Lender to make the Loan in accordance
with the Loan Agreement and with full knowledge that Lender shall rely upon the
representations, warranties and agreements herein contained when making the
Loan, and that but for this instrument and the representations, warranties and
agreements herein contained, the Lender would not take such actions.
(l) Governed by Loan Documents. Manager agrees that until such time
as the Debt has been repaid in full, the terms and provisions of this Agreement
and the Note, the Loan Agreement and the other Loan Documents shall be superior
to the terms and provisions of the Management Agreement with respect to the
payment of any management fees thereunder (other than with respect to payment of
management fees; and other amounts payable under the Management Agreement for
any periods prior to the termination thereof) and termination of the Management
Agreement, and to the extent there are any inconsistencies between the
Management Agreement and this Agreement and the Loan Documents with respect to
such terms and provisions, the terms, provisions and conditions in this
Agreement and the Loan Documents shall govern in all respects.
4. Borrower Consent. Borrower has joined herein to evidence its
consent to all the agreements of Manager contained in this Agreement.
5. Severability. Wherever possible, each provision of this Agreement
shall be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Agreement shall be prohibited by or
invalid under applicable law, such provision shall be ineffective to the extent
of such prohibition or invalidity, without invalidating the remainder of such
provision or the remaining provisions of this Agreement.
6. Counterparts. This Agreement may be executed in several
counterparts, each of which shall be an original and all of which shall
collectively constitute but one and the same instrument.
7. Assignment. Lender shall have the right to transfer, sell and
assign its interest in this Agreement to any Person. All references to "Lender"
hereunder shall be deemed to include the successors and assigns of Lender.
8. Notices. Any notice, election, request, communication or demand
which is required or permitted to be given or served hereunder shall be in
writing and shall be given or served by hand delivery against receipt, by any
nationally recognized overnight courier service providing evidence of the date
of delivery or by certified mail return receipt requested, postage prepaid,
addressed to
C-2-4
If to Lender: UBS Principal Finance LLC
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Facsimile No. (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to: Cadwalader, ▇▇▇▇▇▇▇▇▇▇ & ▇▇▇▇
▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq.
Facsimile No. (▇▇▇) ▇▇▇-▇▇▇▇
If to Borrower: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇▇▇▇, Chief
Financial Officer
Facsimile No. (▇▇▇) ▇▇▇-▇▇▇▇
With a copy to: Debevoise & ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇, Esq.
Facsimile No. (▇▇▇) ▇▇▇-▇▇▇▇
Any such notice or demand given hereunder shall be effective upon delivery or
three (3) days after mailing aforesaid. All notices, elections, requests,
communications and demands required or permitted hereunder shall be in the
English language.
9. Non-Recourse. Anything contained in this Agreement to the
contrary notwithstanding (except as provided below), Lender's recourse with
respect to any claims arising under or in connection with this Agreement shall
be limited solely to the interest of Manager in the Management Agreement, and
none of (i) Manager or any of its Affiliates, (ii) any Persons who presently or
in the future own any direct ownership interest in Manager or any successor of
Manager (each, a "Direct Beneficial Owner") or any affiliate thereof, (iii) any
Person owning, directly or indirectly, any legal or beneficial interest in
Manager or any Direct Beneficial Owner of any Affiliate thereof, or (iv) any
partner, principal, officer, controlling person, beneficiary, trustee, advisor,
shareholder, employee, agent, nominee, Affiliate or director of any Person
described in clauses (i) through (iii) above shall be personally liable for the
performance of any obligation thereunder or the payment of any amount due
hereunder; provided, however, that the foregoing limitation on the personal
liability of the Persons described in clauses (i) through (iv) above shall not
impair the validity of this Agreement or the right of Lender to enforce any of
its rights or remedies hereunder or under any of the other Loan Documents upon
the occurrence of a Cash Management Event as provided in this Agreement. Nothing
contained herein shall release, impair or otherwise affect any right, remedy or
recourse Lender may have against Manager or Borrower with respect to (a) any
fraud or bad faith or any material and intentional misrepresentation by Manager
or its Affiliates made in connection with the transactions contemplated hereby,
(b) bad
C-2-5
faith waste by Manager, (c) any misapplication of Rents following and during the
continuance of a Cash Management Event, or (d) any misapplication of proceeds of
any insurance policies required to be maintained by Borrower or Manager.
[SIGNATURE PAGE IMMEDIATELY FOLLOWS]
C-2-6
Schedule 1
Monthly Replacement Deposit
NONE
Schedule 1 - 1
Schedule 2
Monthly Rollover Deposit
MONTHLY ROLLOVER DEPOSIT
SHALL BE AS SET FORTH IN
SECTION 4.5.1 OF THE
LOAN AGREEMENT
Schedule 2 - 1
Schedule 3
Exceptions to Owner and Borrower Representation
NONE
Schedule 3 - 1
Schedule 4
Contracts
Exhibit Begins on Next Page
Schedule 4 - 1
[LETTERHEAD OF WESTFIELD SHOPPINGTOWN ANNAPOLIS]
Memo
DATE: November 22, 1999
TO: ▇▇▇▇▇▇ ▇▇▇▇▇▇, Assistant to ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
CC: ▇▇▇▇▇ ▇▇▇▇▇, General Manager
FROM: ▇▇▇▇ ▇▇▇▇▇, Assistant Manager
SUBJECT: Request for Contract Information
--------------------------------------------------------------------------------
Per your request:
CONTRACTOR AMOUNT EFFECTIVE DATES
Apple Signs (L&T sign) $7,476.00 10/22/99-12/1/99
BFI $92/trash haul + 12/8/97-12/31/2000
$38.50/ton
$105/cardboard haul
floating rebate on cardboard
Brask Enterprises
(compactor rental) $2,268/month 12/9/97-12/31/2000
▇▇▇▇▇▇▇▇ (landscape maintenance) $59,424/year 3/1/98-12/31/99
Interstate Cleaning Corp.
(Housekeeping) $47,736/month 5/1/98-1/31/99
Interstate Service Company (HVAC) $8,004/year 3 11/14/97-11/14/2000
▇▇▇▇ ▇▇▇▇▇ Design $6,250 10/1/99-12/31/99
Muzak $2,100/year 5/1/97-5/1/2000
$576,305.76/year 1
Professional Security Consultants $592,536.00/year 2 4/24/99-5/1/2001
▇▇▇▇▇▇ Sweeping $45,250.00/year 10/1/98-9/30/2000
Reliable Contracting (snow removal) depends on weather 11/10/99-4/30/99
Simplex monitoring $640/year 2/8/99-2/8/2000
Simplex alarm service $2,800/year 8/5/98-8/5/2000
▇▇▇▇▇▇▇ Magic-Door (service) $3,705/year 1/1/98-12/31/99
Steritech (pest control) $5,640/year 9/1/98-8/31/2000
Sunset Hills Foliage $44,655.48/year 3/1/99-2/29/2000
Call if you need further information.
Schedule 5
Ownership of Owner and Borrower
EXHIBIT BEGINS ON FOLLOWING PAGE
Schedule 5 - 1
SCHEDULE 5
Proposed Westfield Shoppingtown Annapolis
[FLOWCHART SHOWING PROPOSED OWNERSHIP STRUCTURE]
