EXHIBIT 10
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LOAN AGREEMENT
between
▇▇▇▇▇▇▇▇▇ ASSOCIATES REALTY TRUST and
▇▇▇▇▇▇▇▇▇ ASSOCIATES
as Borrower
and
BANKBOSTON, N.A.
as Lender
June 10, 1998
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TABLE OF CONTENTS
Section
1. DEFINITIONS AND RULES OF INTERPRETATION ............................ 8
1.1 Definitions ................................................. 8
1.2 Rules of Interpretation ..................................... 17
2. AGREEMENT TO MAKE LOAN; LIMITATIONS ................................ 18
2.1 Agreement to Make Loan ...................................... 18
Advances Do Not Constitute a Waiver................................. 18
3. THE NOTE, INTEREST RATE OPTIONS, REPAYMENT OF LOAN ................. 18
3.1 The Note .................................................... 18
3.2 The Record .................................................. 18
3.3 Interest on the Loan ........................................ 19
3.4 Interest Rate Selection; Conversion ......................... 19
3.5 Default Interest/Late Charge ................................ 19
3.6 Prepayment .................................................. 19
3.7 Maturity .................................................... 19
3.8 Payments of Principal of Loan ............................... 19
4. COMMITMENT FEE; PAYMENTS AND COMPUTATIONS .......................... 19
4.1 Commitment Fee .............................................. 19
4.2 Payments .................................................... 20
4.3 Additional Costs, Etc ....................................... 20
4.5 Charges Against Accounts .................................... 22
5. COLLATERAL SECURITY ................................................ 22
6. REPRESENTATIONS, WARRANTIES AND COVENANTS .......................... 22
6.1 Organization; Authority, Etc ................................ 23
6.2 Title to Assets ............................................. 24
6.3 Financial Statements ........................................ 24
6.4 No Material Changes, Etc .................................... 24
6.5 Litigation .................................................. 24
6.6 No Materially Adverse Contracts, Etc ........................ 25
6.7 Compliance With Other Instruments, Laws, Etc ................ 25
6.8 Tax Status .................................................. 25
6.9 No Event of Default ......................................... 25
6.10 Setoff, Etc ................................................. 25
6.11 Subsidiaries ................................................ 26
6.12 Partners, Beneficiaries, Etc ................................ 26
6.13 Availability of Utilities ................................... 26
6.14 Access ...................................................... 26
6.15 Condition of Properties ..................................... 26
6.16 Compliance with Requirements ................................ 26
6.17 Project Approvals ........................................... 26
6.18 Other Contracts ............................................. 27
6.19 Violations .................................................. 27
7. AFFIRMATIVE COVENANTS OF THE BORROWER .............................. 27
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7.1 Punctual Payment ............................................ 27
7.2 Correction of Defects ....................................... 28
7.3 Records and Accounts ........................................ 28
7.4 Financial Statements and Information ........................ 28
7.5 Insurance ................................................... 30
7.6 Liens and Other Charges ..................................... 30
7.7 Inspection of Project and Books, Appraisals ................. 30
7.8 Compliance with Laws, Contracts, Licenses, and Permits ...... 31
7.9 Use of Proceeds ............................................. 31
7.10 Leases ...................................................... 31
7.11 Further Assurance of Title .................................. 31
7.12 Deposit of Income ........................................... 32
7.13 Further Assurances .......................................... 32
7.14 Interest Rate Protection Agreement .......................... 33
7.15 Notices ..................................................... 33
7.16 Other Affirmative Covenants ................................. 33
7.17 Management Contracts ........................................ 33
7.18 Cash Flow Account ........................................... 34
8. NEGATIVE COVENANTS OF THE BORROWER ................................. 35
8.1 Restrictions on Easements, Covenants and Restrictions ....... 35
8.2 No Amendments, Terminations or Waivers ...................... 36
8.3 Restrictions on Indebtedness ................................ 36
8.4 Restrictions on Liens, Etc .................................. 37
8.5 Restrictions on Loan and Investments ........................ 37
8.6 Merger, Consolidation, Conversion, Business Operations,
and Ownership and Disposition of Assets.................... 38
8.7 Sale and Leaseback .......................................... 38
8.8 Distributions ............................................... 39
8.9 Financial Covenants ......................................... 39
8.10 Other Negative Covenants .................................... 39
9. CONDITIONS TO CLOSING AND ADVANCE OF LOAN PROCEEDS.................. 40
9.1 Loan Documents .............................................. 40
9.2 Contracts ................................................... 40
9.3 Leases ...................................................... 40
9.4 Certified Copies of Organization Documents................... 40
9.5 Resolutions ................................................. 40
9.6 Incumbency Certificate; Authorized Signers................... 40
9.7 Validity of Liens ........................................... 40
9.8 Deliveries .................................................. 41
9.9 Legal and Other Opinions .................................... 42
9.10 Lien Search ................................................. 43
9.11 Appraised Value ............................................. 43
9.12 Debt Service Charges ........................................ 43
9.13 Commitment Fee .............................................. 43
9.14 Performance; No Default ..................................... 43
9.15 Representations and Warranties .............................. 43
9.16 Proceedings and Documents ................................... 43
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9.17 Waiver ...................................................... 43
10. EVENTS OF DEFAULT AND REMEDIES..................................... 43
10.1 Events of Default ........................................... 44
10.2 Termination of Advances and Acceleration .................... 47
10.3 Remedies .................................................... 47
10.4 Distribution of Collateral Proceeds ......................... 47
10.5 Power of Attorney ........................................... 48
10.6 Waivers ..................................................... 48
11. SETOFF............................................................. 49
12. EXPENSES........................................................... 49
13. INDEMNIFICATION.................................................... 50
14. RIGHTS OF THIRD PARTIES............................................ 51
15. SURVIVAL OF COVENANTS, ETC......................................... 51
16. ASSIGNMENT AND PARTICIPATION....................................... 51
16.1 Conditions to Assignment by Lender ............................ 51
16.2 New Notes, Agreement .......................................... 52
16.3 Participations ................................................ 52
16.4 Pledge by the Lender .......................................... 52
16.5 No Assignment by the Borrower ................................. 52
17. RELATIONSHIP....................................................... 52
18. NOTICES............................................................ 53
19. GOVERNING LAW...................................................... 54
20. CONSENT TO JURISDICTION; WAIVERS................................... 54
21. HEADINGS........................................................... 54
22. COUNTERPARTS....................................................... 54
23. ENTIRE AGREEMENT, ETC.............................................. 55
24. CONSENTS, AMENDMENTS, WAIVERS, ETC................................. 55
25. TIME OF THE ESSENCE................................................ 55
26. SEVERABILITY....................................................... 55
27. NONRECOURSE LOAN................................................... 55
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EXHIBITS
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A - Principal Amortization Schedules
B - Interest Terms and Provisions
C - Covenant Compliance Worksheet and Certificate
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SCHEDULES
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6.3 - Financial Statements Furnished
6.5 - Litigation
6.12 - Partners, Beneficiaries, Etc.
6.17 - Project Approvals
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LOAN AGREEMENT
This LOAN AGREEMENT is made as of the 10th day of June, 1998, by and among
▇▇▇▇▇▇▇▇▇ ASSOCIATES, a Massachusetts general partnership ("▇▇▇▇▇▇▇▇▇") and
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ and ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ as Trustees of ▇▇▇▇▇▇▇▇▇ ASSOCIATES
REALTY TRUST, under a Declaration of Trust dated January 30, 1987, filed for
registration with the Nantucket Registry District of the Land Court as
Document No. 39072 and recorded with the Nantucket Registry of Deeds in Book
268, Page 216 (as amended, the "Trust") and not individually, both having an
address of ▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
(▇▇▇▇▇▇▇▇▇ and the Trust, individually and collectively, the "Borrower"),and
BANKBOSTON, N.A. (the "Lender"), a national banking association, having its
principal executive offices at ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇.
1. DEFINITIONS AND RULES OF INTERPRETATION.
1.1 Definitions. The following terms as used in this Agreement, any
Exhibit hereto, or in any other Loan Document (unless otherwise defined
therein) shall have the meanings set forth in this ss.1. Further, any and all
terms which are defined in Exhibit B, annexed hereto, shall when used herein
have the meaning as set forth in such Exhibit B:
Advance. Any disbursement of the proceeds of the Loan made or to be
made by the Lender pursuant to the terms of this Agreement. Any Advance may be
made to either Borrower, as designated by ▇▇▇▇▇▇▇▇▇, and shall be an Obligation
of each Borrower.
Agreement. This Loan Agreement, including the Schedules and Exhibits
hereto.
Annual Budget. The annual budget for the costs and expenses for the
operation and ownership of the Project, to be submitted by the Borrower to the
Lender for the Borrower's subsequent calendar year in accordance with ss.7.4,
which annual budget shall be subject to the prior written approval of the
Lender, as such may be amended from time to time with the prior written
approval of the Lender.
Appraisal. An appraisal of the market value of the Project, as
determined either (i) by the Lender in its reasonable discretion or (ii) by a
qualified independent appraiser approved by the Lender.
Appraised Value. The market value of the Project, as determined either
(i) by the Lender in its reasonable discretion or (ii) by the most recent
Appraisal obtained pursuant hereto, as such may be reviewed and adjusted by the
Lender.
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Assignment of Leases and Rents. The Assignment of Leases and Rents,
dated or to be dated on or prior to the Closing Date, made by the Borrower in
favor of the Lender.
Balance Sheet Date. December 31, 1997.
Borrower. ▇▇▇▇▇▇▇▇▇ and the Trust, individually and collectively, with
all representations, warranties and covenants herein contained to be applicable
to ▇▇▇▇▇▇▇▇▇ and the Trust, jointly, and each of ▇▇▇▇▇▇▇▇▇ and the Trust
singularly, as the context so provides.
Business Day. Any day on which the Lender is open for the transaction
of banking business in Boston, Massachusetts.
Cash Flow Account. The account maintained with the Lender (Account No.
512-96630) in the name of ▇▇▇▇▇▇▇▇▇, or any other account established to
replace such account, into which account the Borrower shall deposit monthly the
Net Revenues From Operations, as provided herein, such Cash Flow Account to be
pledged to the Lender as provided in the Pledge Agreement.
Closing Date. The first date on which the conditions set forth in ss.9
have been satisfied.
Code. The Internal Revenue Code of 1986 and the regulations
thereunder, all as amended and in effect from time to time.
Collateral. All of the property, rights and interests of the Borrower
that are or are intended to be subject to the security interests, assignments,
and mortgage liens created by the Security Documents, including, without
limitation, the Project.
Default. A condition or event which would, with either the giving of
notice or lapse of time or both, constitute an Event of Default.
Default Rate. See ss.3.5.
Depository Account(s). The Depository Account maintained at the
applicable Depository Account Bank (Account No. 88-904220) in the name of
▇▇▇▇▇▇▇▇▇, or any other account established to replace such account, which
account shall serve as the account into which all Gross Cash Receipts of the
Properties are to be directly deposited by any third parties, the Borrower's
interest in such Depository Account to be pledged to the Lender as provided in
the Pledge Agreement.
Depository Account Bank(s). (i) Nantucket Bank, a banking institution
organized under the laws of the Commonwealth of Massachusetts, with its
principal offices at ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇,
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▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇, for the Properties, or (ii) such other financial
institution(s) designated by the Lender to be the bank of account for the
Depository Account.
Depository Account Letter. See ss.7.12.
Distribution. The (i) declaration or payment of any dividend, (ii)
distribution of cash or other property, (iii) purchase, redemption, or other
retirement (directly or indirectly), or (iv) other distribution, in each case,
of, on or in respect of any shares of any class of capital stock, partnership
interests, or other beneficial or ownership interests of the Borrower.
Event of Default. See ss.10.1.
Financing Statements. Uniform Commercial Code Form 1 Financing
Statement(s) from the Borrower in favor of the Lender.
Generally accepted accounting principles. Principles that are (a)
consistent with the principles promulgated or adopted by the Financial
Accounting Standards Board and its predecessors, as in effect from time to time
and (b) consistently applied with past financial statements of the Borrower
adopting the same principles; provided that a certified public accountant
would, insofar as the use of such accounting principles is pertinent, be in a
position to deliver an unqualified opinion (other than a qualification
regarding changes in generally accepted accounting principles) as to financial
statements in which such principles have been properly applied.
Governmental Authority. The United States of America, the State in
which the Land is located, the city or town in which the Land is located, and
any political subdivision, agency, authority, department, commission, board,
bureau, or instrumentality of any of them.
Gross Cash Receipts. The sum of cash actually received on a
consolidated basis by the Trust and ▇▇▇▇▇▇▇▇▇ during any fiscal period with
respect to the Project in payment of the following items:
(a) rentals, including minimum or base rent, percentage rent,
and rent, if any, attributable to recovery of tenant improvement costs
received from tenants occupying space in the Project during such
period;
(b) cash reimbursements from tenants of operating expenses,
insurance premiums, and real estate taxes and the cost of tenant
improvements;
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(c) rentals for rooms and cottages, whether daily, seasonal
or otherwise; restaurant, food, function, and liquor receipts; and any
and all other receipts for other services provided, or goods sold,
with respect to the operation of cottages or rental rooms;
(d) parking revenues, if any, received in connection with the
operation of parking facilities;
(e) receipts from laundries, vending machines, recreational
facilities and any and all other operating revenues received from the
Project;
(f) receipts received from the Management Companies pursuant
to the Management Contract; and
(g) any and all other receipts from the ownership or
operation of the Project.
If the Borrower shall receive cash by reason of fire or other casualty
insurance proceeds, or a taking by eminent domain, or a loan or advance or a
sale of any part of the Project, such amounts shall not be included in Gross
Cash Receipts; provided, however, any cash paid to the Borrower from rental,
business interruption or similar insurance shall be included in Gross Cash
Receipts.
If the Borrower shall receive any interest income, such interest income shall
not be included in Gross Cash Receipts; provided, however, interest earned on
security deposits, if any, held under any Lease shall be included in Gross
Cash Receipts.
Gross Cash Receipts shall be determined on a consolidated basis for the
Borrower.
Gross Cash Receipts shall be determined on a cash basis consistent with the
basis used in the preparation of the computations of Gross Cash Receipts
furnished pursuant to ss.6.3 of this Agreement.
Guarantor. Three Winthrop Properties, Inc., a corporation organized
under the laws of of the Commonwealth of Massachusetts, having a usual place of
business of ▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇.
Guaranty. The Limited Guaranty, dated or to be dated on or prior to
the Closing Date, of the Obligations, made by the Guarantor.
Improvements. The buildings, structures, parking areas, landscaping
and other improvements of every nature located on the Land, whether now
existing or hereinafter constructed.
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Indebtedness. All obligations, contingent and otherwise, that in
accordance with generally accepted accounting principles should be classified
upon the obligor's balance sheet as liabilities, or to which reference should
be made by footnotes thereto, including in any event and whether or not so
classified: (a) all debt and similar monetary obligations, whether direct or
indirect; (b) all liabilities secured by any mortgage, pledge, security
interest, lien, charge, or other encumbrance existing on property owned or
acquired subject thereto, whether or not the liability secured thereby shall
have been assumed; (c) all liabilities under capitalized leases; and (d) all
guarantees, endorsements and other contingent obligations whether direct or
indirect in respect of indebtedness of others, including the obligations to
reimburse the issuer in respect of any letters of credit.
Indemnity Agreement. The Indemnity Agreement Regarding Hazardous
Materials, dated or to be dated on or prior to the Closing Date, made by the
Borrower and Winthrop Financial Associates, A Limited Partnership in favor of
the Lender.
Interest Rate Protection Agreement. The ISDA Master Agreement dated as
of January 23, 1998, between ▇▇▇▇▇▇▇▇▇ and the Lender, as such may be modified
and amended, or any other agreement entered into to replace the aforesaid
agreement.
Investments. All expenditures made and all liabilities incurred
(contingently or otherwise) for the acquisition of stock or Indebtedness of, or
for loans, advances, capital contributions or transfers of property to, or in
respect to any guaranties (or other commitments as described under
Indebtedness), or obligations of, any Person.
Key Lease(s). The Leases, dated or to be dated on or prior to the
Closing Date, between the Borrower and each Key Tenant.
Key Tenant(s). Any tenant occupying space on any Property as to which
the tenant is required to pay, or pays, a per annum rent (inclusive of base
rent, percentage rent and any and all reimbursements) in excess of $100,000.00.
Land. The parcels of real property located in Nantucket, Nantucket
County, Massachusetts, and described on Exhibit A to the Security Deed.
Leases. Any and all leases, licenses and agreements, whether written
or oral, relating to the use or occupation of space in any of the Properties by
Persons other than the Borrower.
Loan. The loan or any portion thereof which is the subject of this
Agreement.
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Loan Amount. $12,000,000.00.
Loan Documents. This Agreement, the Note, the Indemnity Agreement, the
Interest Rate Protection Agreement, the Security Documents, the Guaranty, and
all other agreements, documents and instruments now or hereafter evidencing,
securing or otherwise relating to the Loan.
Management Company(ies). Any company, with which the Borrower enters
into an agreement to manage the operation of the Project, or any portion
thereof.
Management Contract(s). Any contract by and between the Borrower and a
Management Company relating to the management of the Project or any portion
thereof.
Maturity Date. June 10, 2001.
Net Operating Income. The amount by which the Gross Cash Receipts from
the Project for any fiscal period exceed the aggregate of the following items
for such fiscal period:
(a) all operating costs and expenses incurred in the
operation of the Project (whether incurred by the Borrower, or any
other party), including, without limitation, real estate taxes and
betterment assessments, administrative and office expenses, utility
costs, insurance premiums, cleaning costs, legal and accounting fees,
management fees for the Project and cash security deposits from
tenants returned to tenants in cash to the extent the same were
included as a part of Gross Cash Receipts;
(b) for tenancies of space in the Project, the cost and
expense (including brokerage commissions) of leasing space in the
Project and performing tenant improvement work;
(c) all fees and costs payable to the Management Companies
under or pursuant to the Management Contracts;
paid in cash during such period. There shall not be deducted from Gross Cash
Receipts amounts paid toward any capital improvements, whether or not a
Permitted Capital Improvement. Further, without limitation, charges for income
taxes; capital gain taxes, corporate excise taxes and similar taxes; interest,
principal and other payments due to the Lender with respect to the Project
Obligations; and depreciation, amortization, and other non-cash expenses shall
not be deducted from Gross Cash Receipts in determining Net Operating Income.
Net Operating Income shall be determined on a consolidated basis for the
Borrower.
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Net Operating Income shall be determined on a cash basis, modified as described
above, consistent with the basis used in the preparation of the computations of
Net Operating Income furnished pursuant to ss.6.3 of this Agreement.
Net Revenues From Operations. For any month, the Net Operating Income
for such month, as adjusted by adding thereto any amount deducted from Gross
Cash Receipts representing real estate taxes.
Non-Disturbance, Attornment and Subordination Agreement. An agreement
among the Lender, the Borrower and all Key Tenants under a Lease pursuant to
which, among other things, such tenant agrees to subordinate its rights under
the Lease to the lien of the Security Deed and agrees to recognize the Lender
or its successor in interest as landlord under the Lease in the event of a
foreclosure under the Security Deed.
Non-Recourse Indebtedness. Non-Recourse Indebtedness shall mean and
refer to any Indebtedness as to which the recourse of the creditor thereof is
limited in all events to the collateral granted to such creditor.
Note. The Note in the principal face amount of the Loan Amount dated
as of the date hereof, made by the Borrower to the order of the Lender,
together with any extension, renewal, replacement, substitution, or
modification thereof.
Obligations. All indebtedness, obligations and liabilities of the
Borrower, or either of them, to the Lender, existing on the date of this
Agreement or arising thereafter, direct or indirect, joint or several, absolute
or contingent, matured or unmatured, liquidated or unliquidated, secured or
unsecured, arising by contract, operation of law or otherwise, including,
without limitation, the Project Obligations.
Obligor(s). The Borrower, Winthrop Financial Associates, A Limited
Partnerhsip, or any one of them.
Operating Cash Flow. For any fiscal period, an amount equal to the Net
Operating Income for such period less any capital expenditures.
Organizational Documents. For any corporation, partnership, trust,
limited liability company, limited liability partnership, unincorporated
association, business or other legal entity, the documents pursuant to which
such entity has been established or organized, as such documents may be amended
from time to time.
Outstanding. With respect to the Advances or the Loan, the aggregate
unpaid principal thereof as of any date of determination.
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Party(ies). Each Obligor; for ▇▇▇▇▇▇▇▇▇, each partner authorized to
execute documents on behalf of ▇▇▇▇▇▇▇▇▇; and for the Trust, each trustee of
the Trust.
Permitted Capital Improvements. Any capital improvements to the
Properties as may be approved in writing by the Lender (i) in the Annual
Budget, or (ii)from time to time upon the request of the Borrower.
Permitted Liens. Liens, security interests and other encumbrances,
permitted by ss.8.1 and ss.8.4.
Person. Any individual, corporation, partnership, trust,
unincorporated association, business, or other legal entity, and any government
or any governmental agency or political subdivision thereof.
Personal Property. Any and all personal property of the Borrower, as
to which the Lender shall be granted a security interest as provided in the
Security Agreement.
Pledge Agreement. The Pledge Agreement, dated or to be dated on or
prior to the Closing Date, made by the Borrower in favor of the Lender.
Pro-Forma Debt Service Charges. On any calculation date, the sum of
(i) the projected expenses of the Borrower for the next four (4) fiscal
quarters for (x) interest charges on the Project Obligations based on an
assumed interest rate that is equal to the greater of (A) the applicable
Eurodollar Rate as of such calculation date based upon an Interest Period of
three (3) months or (B) an interest rate equal to the ten (10) year Treasury
Rate plus one and three-quarters (1.75%) percent and (y) projected fees payable
hereunder or under the other Loan Documents, in connection with the Project
Obligations plus (ii) projected principal payments due for next four (4) fiscal
quarters on the Project Obligations.
Project. The Land, Improvements and Personal Property.
Project Approvals. All approvals, consents, waivers, orders,
agreements, acknowledgments, authorizations, permits and licenses required
under applicable Requirements or under the terms of any restriction, covenant
or easement affecting the Project, or otherwise necessary or desirable, for the
ownership, use, occupancy and operation of the Project and the Improvements,
whether obtained from a Governmental Authority or any other Person.
Project Obligations. All indebtedness, obligations and liabilities of
the Borrower, or either of them, to the Lender existing on the date of this
Agreement or arising thereafter,
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direct or indirect, joint or several, absolute or contingent, matured or
unmatured, liquidated or unliquidated, secured or unsecured, arising by
contract, operation of law or otherwise, arising or incurred under this
Agreement, any of the other Loan Documents, or in respect of any of the
Advances or the Note.
Property(ies). The Land and Improvements.
Record. Any record, including computer records, maintained by the
Lender with respect to the balance due under the Loan.
Registry. Nantucket County Registry of Deeds and the Nantucket County
Registry District of the Land Court.
Requirements. Any law, ordinance, code, order, rule or regulation of
any Governmental Authority relating in any way to the acquisition, ownership,
use, occupancy and operation of the Project and the Improvements.
Sale Agreement. The Purchase and Sale Agreement dated as of March 27,
1998, among the Borrower and others, as Seller, and Nantucket Island Resorts
LLC, as Buyer.
Security Agreement. The Security Agreement, dated or to be dated on or
prior to the Closing Date, made by the Borrower in favor of the Lender.
Security Deed. The Mortgage and Security Agreement, dated or to be
dated on or prior to the Closing Date, made by the Borrower in favor of the
Lender.
Security Documents. The Security Deed, the Assignment of Leases and
Rents, the Pledge Agreement, the Security Agreement, the Financing Statements,
and any other agreement, document or instrument now or hereafter securing the
Project Obligations.
▇▇▇▇▇▇▇▇▇. ▇▇▇▇▇▇▇▇▇ Associates, a Massachusetts general partnership,
having a usual place of business at ▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇.
Subsidiary(ies). Any corporation, partnership, association, trust, or
other business entity of which the designated parent shall at any time own
directly, or indirectly through a Subsidiary or Subsidiaries, at least a
majority (by number of votes) of the outstanding voting interests therein.
Taking. Any condemnation for public use of, or damage by reason of,
the action of any Governmental Authority, or any transfer by private sale in
lieu thereof, either temporarily or permanently.
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Title Insurance Company. Chicago Title Insurance Company, with a usual
place of business at ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇.
Title Policy(ies). ALTA title insurance policy issued by the Title
Insurance Company (with such reinsurance or co-insurance as the Lender may
require, any such reinsurance to be with direct access endorsements) in an
aggregate amount not less than the Loan Amount insuring the priority of the
Security Deed and that the Borrower holds marketable fee simple title to each
of the Properties, subject only to such exceptions as the Lender may approve,
and shall contain such endorsements and affirmative insurance as the Lender in
its discretion may require.
Treasury Rate. The term "Treasury Rate" means the latest published
rate for United States Treasury Notes or Bills (but the rate on Bills issued on
a discounted basis shall be converted to a bond equivalent) as published weekly
in the Federal Reserve Statistical Release H.15(519) of Selected Interest
Rates.
Trust. ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ and ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, as Trustees of ▇▇▇▇▇▇▇▇▇
ASSOCIATES REALTY TRUST, under a Declaration of Trust dated January 30, 1987,
filed for registration with the Nantucket Registry District of the Land Court
as Document No. 39072 and recorded with the Nantucket Registry of Deeds in Book
268, Page 216, as amended as of the date hereof and as such may be further
amended from time to time, the sole beneficiary of which is ▇▇▇▇▇▇▇▇▇.
Type; Type of Loan. Any type of Loan available to the Borrower as set
forth in Exhibit B, attached hereto.
Uniform Commercial Code. The Uniform Commercial Code as in effect in
The Commonwealth of Massachusetts.
1.2 Rules of Interpretation.
(1) A reference to any Loan Document, agreement, budget,
document or schedule shall include such agreement, budget, document or
schedule as revised, amended, modified or supplemented from time to
time in accordance with its terms and the terms of this Agreement.
(2) A reference to any Exhibit hereto shall be deemed to
specifically incorporate the terms and provisions of such Exhibit
herein.
(3) The singular includes the plural and the plural includes
the singular.
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(4) A reference to any law includes any amendment or
modification to such law.
(5) A reference to any Person includes its permitted
successors and permitted assigns.
(6) Accounting terms not otherwise defined herein have the
meaning assigned to them by generally accepted accounting principles
applied on a consistent basis by the accounting entity to which they
refer.
(7) The words "approval" and "approved", as the context so
determines, means an approval in writing given to the party seeking
approval after full and fair disclosure to the party giving approval
of all material facts necessary in order to determine whether approval
should be granted.
(8) Reference to a particular "ss." refers to that section of
this Agreement unless otherwise indicated.
2. AGREEMENT TO MAKE LOAN; LIMITATIONS.
2.1 Agreement to Make Loan. Subject to the terms and conditions of
this Agreement, the Lender agrees to lend to the Borrower and the Borrower
agrees to borrow from the Lender on the Closing Date, a maximum aggregate
principal amount equal to the Loan Amount.
2.2 Advances Do Not Constitute a Waiver. Upon any Advance made by the
Lender, the written waiver by Lender of any of the terms and conditions of this
Agreement or the written waiver by the Lender of the failure by the Borrower to
satisfy any such conditions, shall not have the effect of precluding the Lender
from thereafter declaring such failure to satisfy a condition to be an Event of
Default.
3. THE NOTE, INTEREST RATE OPTIONS, REPAYMENT OF LOAN.
3.1 The Note. The obligation of the Borrower to pay the Loan Amount
or, if less, the aggregate unpaid principal amount of all Advances made by the
Lender hereunder plus accrued interest thereon, shall be evidenced by the Note.
In the event the Note is lost, destroyed or mutilated at any time prior to
payment in full of the indebtedness evidenced thereby, the Borrower shall
execute a new note substantially in the form of the Note, provided that the
Lender delivers to the Borrower a lost-note affidavit and an indemnification in
connection with the lost Note. The Note shall not be necessary to establish the
indebtedness of the Borrower to the Lender on account of Advances made under
this Agreement.
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3.2 The Record. The Borrower irrevocably authorizes the Lender to make
or cause to be made, at or about the time of any Advance or at the time of
receipt of any payment of the principal of the Note, an appropriate notation on
the Lender's Record reflecting the making of such Advance or (as the case may
be) the receipt of such payment.
3.3 Interest on the Loan. The Loan shall bear interest at the interest
rates, and such interest shall be payable, as set forth in Exhibit B.
3.4 Interest Rate Selection; Conversion. The Borrower shall have such
rights as are set forth in Exhibit B to select and, as applicable, Convert
Loans from one Type of Loan to another Type of Loan.
3.5 Default Interest/Late Charge.
(1) Upon the occurrence of an Event of Default, and only
during the continuance thereof, at the Lender's option, the Loan and
all other amounts payable hereunder or under any of the other Loan
Documents shall bear interest payable on demand at a rate per annum
equal to four percent (4%) above the then applicable rate of interest
under the Note until such amount shall be paid in full (after as well
as before judgment) (the "Default Rate").
(2) In addition to other charges described in the Loan
Documents, and without derogating from the right of the Lender to
accelerate the Obligations upon the occurrence of an Event of Default,
the Borrower shall pay to the Lender a late charge equal to three (3%)
percent of any payment due under the Note which is not paid within ten
(10) days of the due date thereof.
3.6 Prepayment. The Borrower shall not have the right at any time to
prepay the Note on or before the Maturity Date, as a whole, or in part, except
as set forth in Exhibit B.
3.7 Maturity. The Borrower promises to pay on the Maturity Date, and
there shall become absolutely due and payable on the Maturity Date, all
principal of the Loan outstanding on such date, together with any and all
accrued and unpaid interest thereon.
3.8 Payments of Principal of Loan. The Borrower promises to pay to the
Lender the principal amount of the Loan in consecutive monthly installments of
principal as shown on Exhibit A, annexed hereto, such installments to be due
and payable on each Interest Payment Date.
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4. COMMITMENT FEE; PAYMENTS AND COMPUTATIONS.
4.1 Commitment Fee. The Borrower agrees to pay to the Lender on or
before the Closing Date a commitment fee in the amount of One Hundred and
Twenty Thousand ($120,000.00) Dollars.
4.2 Payments.
(1) All payments of principal, interest, fees and any other
amounts due under the Note or under any of the other Loan Documents
shall be sent to the Lender at ▇.▇. ▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇-▇▇▇▇, or at such other location in the Boston, Massachusetts
area that the Lender may from time to time designate, in the billing
invoice or otherwise, in immediately available funds in lawful money
of the United States.
(2) All payments by the Borrower under the Note and under any
of the other Loan Documents shall be made without setoff or
counterclaim and free and clear of and without deduction for any
taxes, levies, imposts, duties, charges, fees, deductions,
withholdings, compulsory loans, restrictions or conditions of any
nature now or hereafter imposed or levied by any jurisdiction or any
political subdivision thereof or taxing or other authority therein
unless the Borrower is compelled by law to make such deduction or
withholding.
4.3 Additional Costs, Etc. If any future applicable law, which
expression, as used herein, includes statutes, rules and regulations thereunder
and interpretations thereof by any competent court or by any governmental or
other regulatory body or official charged with the administration or the
interpretation thereof and requests, directives, instructions and notices at
any time or from time to time hereafter made upon or otherwise issued to the
Lender by any central bank or other fiscal, monetary or other authority (only
if having the force of law), shall:
(a) subject the Lender to any tax, levy, impost, duty,
charge, fee, deduction or withholding of any nature with respect to
this Agreement, the other Loan Documents, or the Loan (other than
taxes based upon or measured by the income or profits of the Lender or
franchise or doing business taxes), or
(b) materially change the basis of taxation (except for
changes in taxes on income or profits or franchise or doing business
taxes) of payments to the Lender of the principal of or the interest
on any Loan or any other amounts payable to the Lender under this
Agreement or the other Loan Documents, or
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(c) impose or increase or render applicable (other than to
the extent specifically provided for elsewhere in this Agreement) any
special deposit, reserve, assessment, liquidity, capital adequacy or
other similar requirements (only if having the force of law) against
assets held by, or deposits in or for the account of, or loans by, or
commitments of an office of the Lender, or
(d) impose on the Lender any other conditions or requirements
with respect to this Agreement, the other Loan Documents, the Loan, or
any class of loans or commitments of which any of the Loan forms a
part;
and the result of any of the foregoing is
(i) to increase the cost to the Lender of making, funding,
issuing, renewing, extending or maintaining any of the Loan, or
(ii) to reduce the amount of principal, interest or other
amount payable to the Lender hereunder on account of any of the Loan,
or
(iii) to require the Lender to make any payment or to forego
any interest or other sum payable hereunder, the amount of which
payment or foregone interest or other sum is calculated by reference
to the gross amount of any sum receivable or deemed received by the
Lender from the Borrower hereunder,
then, and in each such case, the Borrower will, upon demand made by the Lender
at any time and from time to time and as often as the occasion therefor may
arise, pay to the Lender such additional amounts as will be sufficient to
compensate the Lender for such additional cost, reduction, payment or foregone
interest or other sum; provided, however, (i) any payment of such additional
amounts shall be without prepayment penalty or premium and (ii) the Borrower
shall not be required to pay the additional amounts if within sixty (60) days
of written demand thereof from the Lender to the Borrower, the Borrower pays
in full the Obligations, as to which payment there shall be no prepayment
penalty or premium.
4.4 Capital Adequacy. If any applicable law, rule, regulation,
guideline, directive or request (having force of law) regarding capital
requirements enacted after the date hereof, or the interpretation or
administration thereof after the date hereof by any governmental authority,
central bank or comparable agency charged with the interpretation or
administration thereof, or compliance by the Lender with any of the foregoing
imposes or increases a requirement by the Lender to allocate capital resources
to the Loan made, or to be made, hereunder, which has
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or would have the effect of reducing the return on the Lender's capital to a
level below that which the Lender could have achieved (taking into
consideration the Lender's then existing policies with respect to capital
adequacy and assuming full utilization of the Lender's capital) but for such
adoption, change or compliance, by any amount deemed by the Lender to be
material: (i) the Lender shall promptly after its determination of such
occurrence give notice thereof to the Borrower; and (ii) the Borrower shall pay
to the Lender as an additional fee from time-to-time on demand such amount as
the Lender certifies to be the amount that will compensate it for such
reduction; provided, however, (i) any payment of such additional fees shall be
without prepayment penalty or premium and (ii) the Borrower shall not be
required to pay the additional fees if within sixty (60) days of such notice
from the Lender to the Borrower, the Borrower pays in full the Obligations, as
to which payment there shall be no prepayment penalty or premium. In
determining such amounts, the Lender may use any reasonable averaging and
attribution methods.
4.5 Charges Against Accounts.
(1) The Lender shall have the right and the Borrower hereby
irrevocably authorizes the Lender, to charge the Cash Flow Account,
without the further approval of the Borrower, for any installment of
interest or principal due under the Note.
(2) After the occurrence of an Event of Default and only
during the continuance thereof, the Lender shall have the right and
the Borrower hereby irrevocably authorizes the Lender, to charge any
account of the Borrower with the Lender (exclusive of any account in
the Borrower's name as agent or fiduciary for any other Person),
without the further approval of the Borrower, for (i) any installment
of interest or principal due under the Note, (ii) any costs or
expenses incurred by the Lender which are to be paid or reimbursed by
the Borrower under the terms of this Agreement or any of the other
Loan Documents or (iii) any other sums due to the Lender under the
Note, this Agreement or any of the other Loan Documents, and any other
Obligations, all to the extent that the same are not paid by the
respective due dates thereof.
5. COLLATERAL SECURITY. The Obligations shall be secured by a perfected first
priority mortgage lien and security in the Collateral, whether now owned
or hereafter acquired, pursuant to the terms of the Security Documents to
which the Borrower is a party.
6. REPRESENTATIONS, WARRANTIES AND COVENANTS. The Borrower represents,
warrants, and covenants to the Lender as follows:
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6.1 Organization; Authority, Etc.
(1) Organization; Good Standing. The Trust is, and will at
all times be, validly existing under the laws of the Commonwealth of
Massachusetts. ▇▇▇▇▇▇▇▇▇ is duly organized under the laws of the
Commonwealth of Massachusetts pursuant to the Organizational
Documents, and is, and will at all times be, validly existing under
the laws of the Commonwealth of Massachusetts. To the best of the
Borrower's knowledge, each of the Parties is, and will at all times
be, duly organized and is, and will at all -- times be, validly
existing, in good standing, and qualified to do business in each
jurisdiction where failure to qualify will have a material adverse
effect on such Obligor's business operations. Each Party has, and will
at all times have, all requisite power to own its property and conduct
its business as now conducted and as presently contemplated.
(2) Authorization. To the best of the Borrower's knowledge,
the execution, delivery and performance of this Agreement and the
other Loan Documents to which any Party is or is to become a party and
the transactions contemplated hereby and thereby (i) are within the
authority of such Party, (ii) have been duly authorized by all
necessary proceedings on the part of such Party, (iii) do not conflict
with or result in any breach or contravention of any provision of law,
statute, rule or regulation to which such Party is subject or any
judgment, order, writ, injunction, license or permit applicable to
such Party, (iv) do not conflict with any provision of the
Organizational Documents of such Party, and (v) do not require the
approval or consent of, or filing with, any governmental agency or
authority other than those already obtained and the filing of the
Security Documents and the Financing Statements in the appropriate
public records with respect thereto.
(3) Enforceability. To the best of the Borrower's knowledge,
the execution and delivery of this Agreement and the other Loan
Documents to which each Obligor is or is to become a party will result
in valid and legally binding obligations of such Obligor enforceable
against it in accordance with the respective terms and provisions
hereof and thereof, except as enforceability is limited by bankruptcy,
insolvency, reorganization, moratorium or other laws relating to or
affecting generally the enforcement of creditors' rights and except to
the extent that availability of the remedy of specific performance,
injunctive relief or any other equitable remedy is subject to the
discretion of the court before which any proceeding therefor may be
brought.
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6.2 Title to Assets. The Borrower owns all of the assets reflected in
the balance sheet of the Borrower as at the Balance Sheet Date or acquired
since that date (except property and assets sold or otherwise disposed of (i)
in the ordinary course of business since that date or (ii) in accordance with
the Sale Agreement).
6.3 Financial Statements. There has been furnished to the Lender:
(1) The financial statements of the Borrower as of the
Balance Sheet Date, as listed on Schedule 6.3;
(2) A statement of Gross Cash Receipts and Net Operating
Income for each of the fiscal quarters ended since the Balance Sheet
Date certified by Borrower's chief financial officer, partner or
trustee as fairly presenting the cash receipts and disbursements of
the Project for such period, such statement to be prepared on a basis
consistent with the schedule of cash receipts and disbursements
delivered pursuant to paragraph (a) above.
6.4 No Material Changes, Etc. Since the Balance Sheet Date, to the
best of the Borrower's knowledge, there has occurred no adverse change in the
financial condition or business of each Person as shown on or reflected in the
respective balance sheet as at the Balance Sheet Date, or the statement of
income for the fiscal year then ended, other than changes (i) in the ordinary
course of business that have not had any material adverse effect either
individually or in the aggregate on the business or financial condition of such
Person or (ii) resulting from the consummation of the transaction provided for
in the Sale Agreement and the Distributions provided for in ss.8.8, herein.
6.5 Litigation. Except as otherwise disclosed in Schedule 6.5 hereto,
to the best of the Borrower's knowledge, there are no actions, suits,
proceedings or investigations of any kind pending or threatened against any
Obligor before any court, tribunal or administrative agency or board or any
mediator or arbitrator that, if adversely determined, might, either in any case
or in the aggregate, materially adversely affect the business, assets or
financial condition of such Person, or result in any liability not adequately
covered by insurance, or for which adequate reserves are not maintained on the
balance sheet of such Person, or which question the validity of this Agreement
or any of the other Loan Documents, any action taken or to be taken pursuant
hereto or thereto, or any lien or security interest created or intended to be
created pursuant hereto or thereto, or which will materially adversely affect
the ability of the Borrower to construct, use and occupy the Improvements or to
pay and perform the Project Obligations in the manner contemplated by this
Agreement and the other Loan Documents.
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6.6 No Materially Adverse Contracts, Etc. To the best of the
Borrower's knowledge, each Obligor is not subject to any charter, corporate or
other legal restriction, or any judgment, decree, order, rule or regulation
that has or is expected in the future to have a materially adverse effect on
the business, assets or financial condition of such Person. To the best of the
Borrower's knowledge, each Obligor is not, and will not be, a party to any
contract or agreement that has or is expected, in the judgment of the
Borrower's officers, to have any materially adverse effect on the business of
such Person.
6.7 Compliance With Other Instruments, Laws, Etc. To the best of the
Borrower's knowledge, each Party is not, and will not at any time be, in
violation of any provision of its Organizational Documents or any agreement or
instrument to which it may be subject or by which it or any of its properties
may be bound or any decree, order, judgment, statute, license, rule or
regulation, in any of the foregoing cases in a manner that could result in the
imposition of substantial penalties or materially and adversely affect the
financial condition, properties or business of such Party.
6.8 Tax Status. Each Obligor and Subsidiary thereof (a) has made or
filed, and will make or file in a timely fashion, all federal and state income
and all other tax returns, reports and declarations required by any
jurisdiction to which it is subject, (b) has paid, and will pay when due, all
taxes and other governmental assessments and charges shown or determined to be
due on such returns, reports and declarations, except those being contested in
good faith and by appropriate proceedings, (c) if a partnership, limited
partnership, limited liability partnership, or limited liability company, has,
and will maintain, partnership tax classification under the Code, and (d) has
set aside, and will at all times set aside, on its books provisions reasonably
adequate for the payment of all taxes for periods subsequent to the period to
which such returns, reports or declarations apply. There are no unpaid taxes in
any material amount claimed to be due by the taxing authority of any
jurisdiction, and the officers, partners or trustees of the Borrower know of no
basis for any such claim. The Borrower has filed, and will continue to file,
all of such tax returns, reports, and declarations either (i) separately from
any parent or affiliate or (ii) if part of a consolidated filing, as a separate
member of any such consolidated group.
6.9 No Event of Default. No Default or Event of Default has occurred
and is continuing.
6.10 Setoff, Etc. To the best of the Borrower's knowledge, the
Collateral and the Lender's rights with respect to the
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Collateral are not subject to any setoff, claims, withholdings or other
defenses.
6.11 Subsidiaries. The Borrower does not, and will not have any,
Subsidiaries.
6.12 Partners, Beneficiaries, Etc. Except as set forth in Schedule
6.12, the Trust has no other trustees or beneficiaries and ▇▇▇▇▇▇▇▇▇ has no
other partners.
6.13 Availability of Utilities. To the best of the Borrower's
knowledge, all utility services necessary and sufficient for the construction,
use and operation of the Properties are presently, and will at all times be,
available to the boundaries of the Land through dedicated public rights of way
or through perpetual private easements, approved by the Lender, with respect to
which the Security Deed creates a valid and enforceable first lien. To the best
of the Borrower's knowledge, the Borrower has obtained all utility
installations and connections required for the operation and servicing of the
Properties for its intended purposes, and will furnish the Lender with evidence
thereof.
6.14 Access. The rights of way for all roads necessary for the full
utilization of the Improvements for their intended purposes have either been
acquired by the appropriate Governmental Authority or have been dedicated to
public use and accepted by such Governmental Authority, all such roads shall
have been completed, and the right to use all such roads, or suitable
substitute rights of way approved by the Lender, have been obtained and shall
be maintained at all times for the Properties. All curb cuts, driveways and
traffic signals required for the operation and use of the Properties are
existing and shall be maintained at all times for the Properties.
6.15 Condition of Properties. None of the Properties nor any part
thereof is now damaged or injured as result of any fire, explosion, accident,
flood or other casualty or has been the subject of any Taking, and to the
knowledge of the Borrower, no Taking is pending or contemplated.
6.16 Compliance with Requirements. The Borrower has delivered to
Lender various reports regarding the presence of hazardous materials, oil,
asbestos and lead paint on the Properties. To the extent that these reports
have identified the need to perform any further assessment or remediation of
hazardous materials, oil, asbestos and lead paint effecting certain portions of
the Properties, the Borrower agrees to comply with all Requirements with
respect thereto.
6.17 Project Approvals.
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(1) Except as provided in Schedule 6.17, hereto, to the best
of the Borrower's knowledge, the Borrower has obtained all Project
Approvals. All such Project Approvals obtained by the Borrower are
listed and described on Schedule 6.17 hereto, have been validly issued
and are in full force and effect. All such Project Approvals are held
in the name of the Borrower, except as set forth in Schedule 6.17. To
the best of the Borrower's knowledge, no Project Approvals will
terminate, or become void or voidable or terminable, upon any sale,
transfer or other disposition of the Project, including any transfer
pursuant to foreclosure sale under the Security Deed.
(2) The Borrower will duly perform and comply with all of the
terms and conditions of all Project Approvals obtained at any time,
including all Project Approvals listed and described on Schedules 6.17
hereto.
6.18 Other Contracts.
(1) The Borrower has not made, and will not make any,
contract or arrangement of any kind or type whatsoever (whether oral
or written, formal or informal), the performance of which by the other
party thereto could give rise specifically pursuant to the terms of
such contract or arrangement to a lien or encumbrance on the
Collateral, other than the Loan Documents, without any court or other
legal proceeding.
(2) Except for the Management Contract with Winthrop
Management, the Borrower will not make, any contract or arrangement of
any kind or type whatsoever, with any affiliate of the Borrower unless
such contract or arrangement is on substantially the same terms as
would be generally available to the Borrower in an arm's length
contract or arrangement with a third party.
6.19 Violations. The Borrower has received no notices of, or has any
knowledge of, any violations of any applicable Requirements or Project
Approvals.
7. AFFIRMATIVE COVENANTS OF THE BORROWER. The Borrower covenants and
agrees that, so long as the Loan is outstanding or the Lender has any
obligation to make Advances:
7.1 Punctual Payment. The Borrower will duly and punctually pay or
cause to be paid the principal and interest on the Loan and all other amounts
provided for in the Note, this Agreement and the other Loan Documents to which
the Borrower is a party, all in accordance with the terms of the Note, this
Agreement and such other Loan Documents.
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7.2 Correction of Defects. The Borrower will promptly after becoming
aware thereof correct or cause to be corrected all material defects in the
Improvements.
7.3 Records and Accounts. The Borrower will (a) keep true and accurate
records and books of account in which full, true and correct entries will be
made in accordance with generally accepted accounting principles, which records
and books will not be maintained on a consolidated basis with those of any
other Person, including, any Obligor, Subsidiary of the Borrower, or parent or
affiliate of the Borrower, (b) maintain adequate accounts and reserves for all
taxes (including income taxes), depreciation and amortization of its
properties, contingencies, and other reserves, all of which accounts shall not
be commingled with accounts of any other Person, including any Obligor,
Subsidiary of the Borrower, or parent or affiliate of the Borrower, and (c) in
order to assist the Lender in monitoring the financial condition of the
Borrower and the Collateral, except as may be otherwise agreed by the Lender,
maintain, or cause to be maintained, at the Lender substantially all operating
accounts of the Borrower.
7.4 Financial Statements and Information. The Borrower will deliver,
or cause to be delivered, to the Lender:
(1) as soon as practicable, but in any event not later than
ninety (90) days after the end of each calendar year, the consolidated
audited balance sheet of Nantucket Island Associates Limited
Partnership and the Borrower at the end of such year, and the related
audited statement of income, statement of retained earnings, changes
in capital, and statement of cash flows for such year, each setting
forth in comparative form the figures for the previous calendar year,
as such comparative information relates to the Properties, and all
such statements to be in reasonable detail, prepared in accordance
with generally accepted accounting principles, and accompanied by an
auditor's report prepared without qualification by Immowitz & ▇▇▇▇▇▇
and Company, LLP or by another independent certified public accountant
acceptable to the Lender, and the Form 10-K filed with the Federal
Securities and Exchange Commission, together with a written statement
from such accountants to the effect that they have read a copy of this
Agreement, and that, in making the examination necessary to said
certification, they have obtained no knowledge of any Default or Event
of Default under this Agreement, or, if such accountants shall have
obtained knowledge of any then existing Default or Event of Default
they shall disclose in such statement any such Default or Event of
Default; provided that such accountants shall not be liable to the
Lender for failure to obtain knowledge of any Default of Event of
Default;
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(2) as soon as practicable, but in any event not later than
forty-five (45) days after the end of each calendar quarters, copies
of the consolidating unaudited financial statements for Nantucket
Island Associates Limited Partnership and the Borrower as at the end
of such quarter for the portion of the calendar year then elapsed,
setting forth in comparative form the figures for the previous
calendar year, as such comparative information relates to the
Properties, all in reasonable detail and prepared in accordance with
generally accepted accounting principles, and the Form 10-Q filed with
the Federal Securities and Exchange Commission, together with a
certification by the principal financial or accounting officer, or
partner of Nantucket Island Associates Limited Partnership that the
information contained in such financial statements fairly presents the
financial position of Nantucket Island Associates Limited Partnership
and the Borrower on the date thereof (subject to year-end adjustments)
and that, in making the examination necessary to said certification,
such Person has obtained no knowledge of any Default or Event of
Default under this Agreement;
(3) contemporaneously with the delivery of the financial
statements referred to in clause (a) above, a statement of all
contingent liabilities of Nantucket Island Associates Limited
Partnership and the Borrower which are not reflected in such financial
statements or referred to in the notes thereto, and a statement of
projected cash flows of the Borrower for the current calendar year,
all in reasonable detail and certified by the principal financial or
accounting officer of Nantucket Island Associates Limited Partnership;
(4) simultaneously with the delivery of the financial
statements referred to in clause (a) above, a statement in the form of
Exhibit C, attached hereto, signed by the principal financial or
accounting officer, partner or trustee of the Borrower and setting
forth in reasonable detail computations evidencing compliance with the
covenants contained in ss.8.9;
(5) on or before each January 31, (i) an annual business plan
for the Borrower including, without limitation, a leasing report
setting forth the Borrower's efforts to market and lease the then
unleased space in the Improvements and the results of such efforts and
(ii) an Annual Budget for the next calendar year, which Annual Budget
shall be subject to the Lender's approval;
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(6) within forty-five (45) days after the end of each
calendar year, an annual certified rent roll and lease receivable
aging as of the end of such fiscal year;
(7) contemporaneously with the filing or mailing thereof,
copies of all material of a financial nature filed with the Securities
and Exchange Commission or sent to the stockholders, partners,
members, or beneficiaries of the applicable Obligor or Nantucket
Island Associates Limited Partnership; and
(8) from time to time such other financial data and
information (including quarterly financial reports and accountants'
management letters) as the Lender may reasonably request and that is
reasonably available.
7.5 Insurance.
(1) The Borrower will obtain and maintain insurance with
respect to the Project and the operations of the Borrower as required
by the Security Deed.
(2) The Borrower will provide the Lender with certificates
evidencing such insurance upon the request of the Lender.
(3) The Borrower will obtain and maintain flood insurance in
an amount prescribed by Lender.
7.6 Liens and Other Charges. The Borrower will duly pay and discharge,
or cause to be paid and discharged, before the same shall become overdue all
claims for labor, materials, or supplies that if unpaid might by law become a
lien or charge upon any of its property, except for those being contested in
good faith and pursuant to appropriate proceedings.
7.7 Inspection of Project and Books, Appraisals.
(1) The Borrower shall permit the Lender and the any
consultant retained by the Lender, at the Borrower's expense, to visit
and inspect Project and will cooperate with the Lender during such
inspections.
(2) The Borrower shall permit, or cause to permit, the Lender
at the Borrower's expense to visit and inspect the Properties, to
examine the books of account of the Borrower and any other Obligor
(and to make copies thereof and extracts therefrom) and to discuss the
affairs, finances and accounts of such Person with, and to be advised
as to the same by, its officers, partners, or trustees, all at such
reasonable times and intervals as the Lender may reasonably
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request; provided that so long as no Event of Default shall have
occurred and be continuing, the expenses associated with the
investigation of the books of account of each Obligor shall be borne
by the Lender.
(3) The Lender shall have the right to obtain from time to
time, at the Borrower's cost and expense, updated Appraisals of the
Project, provided that so long as no Default or Event of Default shall
have occurred and be continuing, the Borrower shall only be obligated
to pay for the costs and expenses associated with one such Appraisal
during any twenty-four (24) month period.
(4) The costs and expenses incurred by the Lender in
obtaining such Appraisals and after the occurrence of an Event of
Default and only during the continuance thereof, the costs and
expenses incurred by the Lender in performing such inspections shall
be paid by the Borrower forthwith upon billing or request by the
Lender for reimbursement therefor.
7.8 Compliance with Laws, Contracts, Licenses, and Permits. The
Borrower will, or will cause each Obligor and each Subsidiary thereof to,
comply in all material respects with (a) the applicable laws and regulations
wherever its business is conducted and, in the case of the Borrower, all
Requirements, (b) the provisions of its Organizational Documents, (c) all
agreements and instruments by which it or any of its properties may be bound,
including, in the case of the Borrower, the Key Leases, the Management
Contracts, all construction contracts and all restrictions, covenants and
easements affecting the Project, (d) all applicable decrees, orders and
judgments, and (e) all licenses and permits required by applicable laws and
regulations for the conduct of its business or the ownership, use or operation
of its properties, including, in the case of the Borrower, all Project
Approvals.
7.9 Use of Proceeds. The Borrower will use the proceeds of the Loan
solely for the purpose of refinancing existing indebtedness on the Properties.
7.10 Leases. The Borrower will make reasonable efforts to market and
lease the leaseable area of the Improvements. Further, the Borrower will comply
with the terms and conditions of the Security Documents relating to any and all
Leases.
7.11 Further Assurance of Title. If at any time the Lender or the
Lender's counsel has reason to believe that any Advance is not secured or will
or may not be secured by the Security Deed and/or the Security Agreement as a
first lien or security interest on the Project, then the Borrower shall, within
ten (10) days after written notice from the Lender, do all things and
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matters reasonably necessary, to assure to the reasonable satisfaction of the
Lender and the Lender's counsel that any Advance previously made hereunder or
to be made hereunder is secured or will be secured by the Security Deed and/or
the Security Agreement as a first lien or security interest on the Project.
7.12 Deposit of Income.
(1) The Borrower shall cause the tenants, occupants and
licensees under the Leases, the Management Companies, and any other
account debtor of the Borrower, to directly deposit in the Depository
Account any and all sums due the Borrower.
(2) Any Gross Cash Receipts, other proceeds of Collateral or
other proceeds from the operation, ownership and development of the
Project received by the Borrower, whether in the form of cash, checks,
notes or other instruments, shall be deposited daily in the Depository
Account.
(3) The Borrower shall cause the Depository Account Bank, and
if applicable, the Management Company, to execute and deliver to the
Lender a letter evidencing the relative rights of the Lender and the
Borrower in and to the funds in the Depository Account (the
"Depository Account Letter"), such letter to be in form and substance
satisfactory to the Lender.
(4) The funds in the Depository Account shall be utilized by
the Management Companies to pay the costs and expenses of operating
the Project based upon the Annual Budget, exclusive of the payment of
the costs of Permitted Capital Improvements, the payments of interest
and principal due on the Loan, and real estate taxes.
(5) The Borrower's interest in and to the Depository Account
shall be pledged as additional and collateral security for the
Obligations as provided in the Pledge Agreement.
7.13 Further Assurances.
(1) Regarding Preservation of Collateral. The Borrower will
execute and deliver to the Lender such further documents, instruments,
assignments and other writings, and will do such other acts reasonably
necessary or desirable, to preserve and protect the Collateral at any
time securing or intended to secure the Obligations, as the Lender may
reasonably require.
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(2) Regarding this Agreement. The Borrower will cooperate
with, and will do such further acts and execute such further
instruments and documents as the Lender shall reasonably request to
carry out to its satisfaction the transactions contemplated by this
Agreement and the other Loan Documents.
7.14 Interest Rate Protection Agreement. The Borrower shall maintain
the Interest Rate Protection Agreement in full force and effect during the term
of the Loan, and shall not, without the written consent of the Lender, modify,
terminate, or transfer such Interest Rate Protection Agreement during such
period.
7.15 Notices. The Borrower will promptly after becoming aware thereof
notify the Lender in writing of (i) the occurrence of any Default or Event of
Default; (ii) the occurrence of any other event which may have a material
adverse effect on the Project or the business or financial condition of any
Obligor; or (iii) the receipt by the Borrower of any notice of default or
notice of termination with respect to any Management Contract.
7.16 Other Affirmative Covenants. The Borrower will:
(1) Remain solvent and pay all of its Indebtedness from its
assets as the same become due;
(2) At all times hold itself out to the public as a legal
entity, separate and distinct from any other Person, including any
Obligor, Subsidiary of the Borrower, or any parent or affiliate of the
Borrower; and
(3) Maintain adequate capital for the normal obligations
reasonably foreseeable for a business of its size and character and in
light of its contemplated business operations.
7.17 Management Contracts.
(1) The Borrower has entered into the Management Contracts,
which Management Contracts have been approved by the Lender. In
connection with the approval of any replacement Management Companies
or replacement Management Contracts:
(1) the Management Company or holder of the stock or
partnership interest therein, shall be a Person whose
character, financial strength, stability and experience is
reasonably acceptable to the Lender and who shall have
experience managing complexes of a type and size reasonably
similar to the Project;
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(2) the Borrower shall pay the reasonable fees,
costs and expenses of Lender and Lender's counsel incurred in
connection with the review and approval of any such
Management Company; and
(3) the terms of any Management Contract affecting
the Collateral must be reasonably acceptable to Lender in all
respects.
(2) The Borrower shall, from time to time, use its reasonable
efforts to obtain from the Management Company under the Management
Contract such certificates of estoppel with respect to compliance by
Borrower with the terms of the Management Contract as may be requested
by Lender, to the extent to which the Management Contract requires the
Management Company to execute and deliver such certificates of
estoppel. The Borrower shall include within any replacement Management
Contract an agreement by the Management Company to provide such
Certificates of Estoppel as may be reasonably requested by the Lender.
(3) Each Management Company shall consent to the assignment
of the Management Contract to the Lender and shall enter into an
agreement with the Lender relative to (i) the recognition of the
Lender or any successor in the event of the exercise by the Lender of
its rights, upon the occurrence of an Event of Default, and (ii) the
right of the Lender to terminate the Management Contract upon thirty
(30) days notice upon the occurrence of an Event of Default, without
the payment of any termination or other fee or charge.
7.18 Cash Flow Account.
(1) Borrower shall create the Cash Flow Account into which
the Borrower shall cause to be deposited (i) from the Depository
Account, monthly no later than the 15th day of each month, the Net
Revenues From Operations for the prior month, and (ii) any and all
other Gross Cash Receipts, except to the extent such Gross Cash
Receipts are deposited in the Depository Account to maintain the
Minimum Balances required with respect thereto.
(2) Prior to the occurrence of an Event of Default (to the
extent such funds are available in the Cash Flow Account):
(1) upon the written request of the Borrower, if the
projected expenses of operating the Project for any month as
set forth in the Annual Budget exceed the anticipated Gross
Cash Receipts for such
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month, the Lender shall transfer from the Cash Flow Account
to the Depository Account designated by the Borrower the
amount of such shortfall; and
(2) on the last business day of June, July, August
and September of each year, an amount equal to one-fourth
(1/4th) of the yearly real estate taxes, ad valorem taxes,
personal property taxes, assessments, betterments and all
government charges of every name and restriction which may be
levied on any Property, shall be paid to the Lender to be
held as provided in Section 2 of the Security Deed; and
(3) the Lender may charge the Cash Flow Account for
the monthly installments of principal and interest due under
the Note, as provided for in ss.4.5, herein; and
(4) the Lender shall release to the Borrower funds
sufficient to pay the costs and expenses of Permitted Capital
Improvements, provided the Borrower shall have delivered a
written request for the disbursement to Lender (1) setting
forth the amount of the requested disbursement, (2)
containing certifications from the Borrower that the work for
which the disbursement is requested has been completed and is
a Permitted Capital Improvement, (3) the costs are in
accordance with the Annual Budget, or as otherwise approved
in writing by the Lender, and the costs to be paid are then
due and payable and (4) such other evidence of completion of
work as may be requested by Lender; and
(5) the Lender shall release to the Borrower, from
time to time, upon the request therefor, funds sufficient to
pay distributions allowed under ss.8.8(a), herein.
(3) The Cash Flow Account shall be held by Lender as
additional and collateral security for the Obligations as provided in
the Pledge Agreement.
(4) The Cash Flow Account shall be an interest bearing
account maintained at the Lender. Lender shall have no liability for
fluctuations in interest rate or for the amount of interest earned on
the account. Interest earned on the Cash Flow Account shall be
disbursed as provided for above until such time as the account is
released to the Borrower or the proceeds are applied by Lender to the
payment of the Obligations as provided herein.
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8. NEGATIVE COVENANTS OF THE BORROWER. The Borrower covenants and agrees
that, so long as the Loan is outstanding:
8.1 Restrictions on Easements, Covenants and Restrictions. The
Borrower will not create or suffer to be created or to exist any easement,
right of way, restriction, covenant, condition, license or other right in favor
of any Person which affects or might affect title to the Properties or the use
and occupancy of the Properties or any part thereof without obtaining the prior
approval of the Lender, except for the following:
(1) A certain Cross Easement Agreement dated June 10, 1998,
by and between Nantucket Boat Basin LLC and the Trust, which shall be
recorded with the Registry prior to the recording of the Security
Deed; and
(2) A certain Loan Term Lease dated June 10, 1998, by and
between Nantucket Boat Basin LLC and the Trust, Notice of which Lease
shall be recorded with the Registry prior to the recording of the
Security Deed.
8.2 No Amendments, Terminations or Waivers.
(1) The Borrower will not amend, supplement or otherwise
modify in any material respect, whether by change order or otherwise,
any of the terms and conditions of the Management Contract, without in
each case the prior approval of the Lender.
(2) The Borrower will not, directly or indirectly, terminate
or cancel, or cause or permit to exist any condition which would
result in the termination or cancellation of, or which would relieve
the performance of any obligations of any other party under, the
Management Contracts, without in each case the prior approval of the
Lender to the replacement Management Company and the replacement
Management Contract.
(3) The Borrower will not, directly or indirectly, waive or
agree or consent to the waiver of, the performance of any obligations
or any other party under the Management Contracts.
(4) The Borrower will not, directly or indirectly, amend, or
allow the amendment of, any of the Organizational Documents of the
Borrower in any material respect.
8.3 Restrictions on Indebtedness. The Borrower will not create, incur,
assume, guarantee or be or remain liable, contingently or otherwise, with
respect to any Indebtedness other than:
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(1) Indebtedness to the Lender arising under any of the Loan
Documents;
(2) current liabilities of the Borrower relating to the
Project, incurred in the ordinary course of business but not incurred
through (i) the borrowing of money, except as set forth in (a), above,
or (ii) the obtaining of credit except for credit on an open account
basis customarily extended and in fact extended in connection with
normal purchases of goods and services; and
(3) Indebtedness relating to the Project, in respect of
taxes, assessments, governmental charges or levies and claims for
labor, materials and supplies to the extent that payment therefor
shall not at the time be required to be made in accordance with the
provisions of ss.6.8 and ss.7.6.
8.4 Restrictions on Liens, Etc. The Borrower will not (a) create or
incur or suffer to be created or incurred or to exist any lien, encumbrance,
mortgage, pledge, charge, restriction or other security interest of any kind
upon any of its property or assets of any character whether now owned or
hereafter acquired, or upon the income or profits therefrom; (b) acquire, or
agree or have an option to acquire, any property or assets upon conditional
sale or other title retention or purchase money security agreement, device or
arrangement; (c) suffer to exist for a period of more than sixty (60) days
after the same shall have been incurred any Indebtedness or claim or demand
against it that if unpaid might by law or upon bankruptcy or insolvency, or
otherwise, be given any priority whatsoever over its general creditors, unless
being contested in good faith and pursuant to appropriate proceedings; or (d)
sell, assign, pledge or otherwise transfer any accounts, contract rights,
general intangibles, chattel paper or instruments, with or without recourse;
provided that the Borrower may create or incur or suffer to be created or
incurred or to exist:
(1) statutory liens relating to the Project, to secure taxes,
assessments and other governmental charges or claims for labor,
material or supplies in respect of obligations not overdue;
(2) liens under Section 1 or Section 2 of the Mechanic's Lien
Law;
(3) liens in favor of the Lender under the Loan Documents;
(4) other liens on the Project consisting of easements,
rights of way, covenants and restrictions if and to the extent the
same are disclosed on the Title Policy and have been approved by the
Lender.
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8.5 Restrictions on Loan and Investments. The Borrower will not make
or permit to exist or to remain outstanding any loan by the Borrower to any
Person or any Investment except Investments in:
(1) marketable direct or guaranteed obligations of the United
States of America that mature within one (1) year from the date of
purchase by the Borrower;
(2) demand deposits and bankers acceptances of United States
banks having total assets in excess of $1,000,000,000;
(3) certificates of deposit and time deposits of United
States banks having total assets in excess of $1,000,000,000 that
mature within one (1) year from the date of purchase by the Borrower;
(4) securities commonly known as "commercial paper" issued by
a corporation organized and existing under the laws of the United
States of America or any state thereof that at the time of purchase
have been rated and the ratings for which are not less than "P 1" if
rated by ▇▇▇▇▇'▇ Investors Services, Inc., and not less than "A 1" if
rated by Standard and Poor's; and
(5) short term or demand loans to any Subsidiary or affiliate
thereof made in the ordinary course and consistent with past
practices.
8.6 Merger, Consolidation, Conversion, Business Operations, and
Ownership and Disposition of Assets.
(1) The Borrower shall not own any assets other than the
Project or other assets incidental to the ownership or operation of
the Project.
(2) The Borrower will not become a party to any merger or
consolidation, or agree to or effect any asset acquisition or stock
acquisition.
(3) The Borrower will not become a party to or agree to or
effect any disposition of the Project or any part thereof.
(4) The Borrower will not convert into any other type of
entity, including, without limitation, a limited liability partnership
or a limited liability company.
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(5) The Borrower will not engage in any business operations
other than those necessary for the ownership, construction,
management, or operation of the Project.
8.7 Sale and Leaseback. The Borrower will not enter into any
arrangement, directly or indirectly, whereby the Borrower shall sell or
transfer any property owned by it in order then or thereafter to lease such
property or lease other property that the Borrower intends to use for
substantially the same purpose as the property being sold or transferred.
8.8 Distributions. The Borrower will not make any Distributions;
provided, however, prior to the occurrence of an Event of Default, the Borrower
shall be allowed to make Distributions for the following:
(1) Administrative Fees. The Borrower may distribute funds
from operations to pay administrative fees, expenses and
reimbursements (including, without limitation, legal, accounting and
investor service fees) of Borrower, any Obligor, or Nantucket Island
Associates Limited Partnership; and
(2) Proceeds of Sale of Certain Assets and other
Distributions. Concurrently with the closing hereof, the Borrower
shall have received proceeds from the sale contemplated in the Sale
Agreement. The proceeds of such sale and the funds held as of the date
hereof in a certain Cash Flow Account established pursuant to a
certain Loan Agreement dated February 26, 1997, by and between the
Borrower and the Lender, may be distributed by the Borrower in the
manner previously disclosed to the Lender.
8.9 Financial Covenants. The Borrower covenants and agrees that, so
long as the Loan is outstanding:
(1) Ratio of Operating Cash Flow to Pro-Forma Debt Service
Charges. The Borrower will not, at the end of any fiscal quarter,
permit Operating Cash Flow (as determined in a manner satisfactory to
the Lender) for the prior four (4) fiscal quarters (inclusive of the
subject fiscal quarter) to be less than 175% of Pro-Forma Debt Service
Charges (as determined in a manner satisfactory to the Lender) for the
next four (4) fiscal quarters.
(2) Appraised Value. The Borrower will not permit the
outstanding principal amount of the Loan to exceed fifty-five (55%)
percent of the Appraised Value of the Project.
8.10 Other Negative Covenants. The Borrower will not:
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(1) Seek the dissolution or winding up, in whole or in part,
of the Borrower or voluntarily file, or consent to the filing of, a
petition for bankruptcy, reorganization, assignment for the benefit of
creditors or similar proceedings; and
(2) Commingle any of its accounts with accounts of any other
Person, including, any Obligor, Subsidiary of the Borrower, or parent
or affiliate of the Borrower.
9. CONDITIONS TO CLOSING AND ADVANCE OF LOAN PROCEEDS. The obligation of
the Lender to make any Advance shall be subject to the satisfaction of
the following conditions precedent:
9.1 Loan Documents. Each of the Loan Documents shall have been duly
executed and delivered by the respective parties thereto, shall be in full
force and effect and shall be in form and substance satisfactory to the Lender.
9.2 Contracts. The Borrower shall have delivered to the Lender correct
and complete photocopies of the Management Contracts and all other executed
management, brokerage, sales, leasing or other agreements for the Project.
9.3 Leases. The Key Leases shall be in full force and effect, and
shall be in form and substance satisfactory to the Lender. The Borrower shall
use reasonable efforts to obtain and deliver to the Lender on or after the
Closing Date a fully executed Non-Disturbance, Attornment and Subordination
Agreement from each Key Tenant, in the form reasonably acceptable to the
Lender.
9.4 Certified Copies of Organization Documents. The Lender shall have
received from each of the Parties a certified copy of its Organization
Documents as in effect on such date of certification, such Organizational
Documents to be in form and substance satisfactory to the Lender.
9.5 Resolutions. All action necessary for the valid execution,
delivery and performance by each Party of this Agreement and the other Loan
Documents to which it is or is to become a party, shall have been duly and
effectively taken, and evidence thereof satisfactory to the Lender shall have
been provided to the Lender. The Lender shall have received from each such
Person true copies of the resolutions authorizing the transactions described
herein, each certified as of a recent date to be true and complete.
9.6 Incumbency Certificate; Authorized Signers. The Lender shall have
received from each Party an incumbency certificate, dated as of the Closing
Date, giving the name and bearing a
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specimen signature of each individual who shall be authorized: (a) to sign, in
the name and on behalf of such Person each of the Loan Documents to which such
Person is or is to become a party; (b) in the case of the Borrower, to submit
requisitions; and (c) to give notices and to take other action on its behalf
under the Loan Documents.
9.7 Validity of Liens. The Security Documents shall be effective to
create in favor of the Lender a legal, valid and enforceable first lien and
security interest in the Collateral. All filings, recordings, deliveries of
instruments and other actions necessary or desirable in the opinion of the
Lender to protect and preserve such lien and security interest shall have been
duly effected. The Lender shall have received evidence thereof in form and
substance reasonably satisfactory to the Lender.
9.8 Deliveries. The following items or documents shall have been
delivered to the Lender by the Borrower and shall be in form and substance
satisfactory to the Lender:
(1) Insurance. Duplicate originals or certified copies of all
policies of insurance required by the Security Deed or hereunder to be
obtained and maintained.
(2) Real Estate Requirements: To the extent requested by
Lender for any Property, such requirements typical of a first mortgage
real estate loan, including, without limitation, (i) evidence of all
applicable permits, licenses, and approvals, (ii) title insurance in
favor of the Lender from an acceptable insurer, with such co-insurance
as may be required by the Lender, (iii) flood insurance or evidence of
inapplicability, (iv) property insurance in an acceptable amount and
with respect to agreed upon risks, (v) evidence of payment of real
estate taxes, and (vii) rent roll and copies of lease.
(3) Title Policies. The Title Policies, together with proof
of payment of all fees and premiums for such policy and true and
accurate copies of all documents listed as exceptions under such
policy.
(4) Environmental Report, Etc.
(1) An update of the environmental site reports
delivered to the Lender in connection with the loan
arrangement evidenced by that certain Loan Agreement dated
February 26, 1997, by and between the Borrower and the
Lender.
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(2) Without limiting the generality of the
foregoing, Lender must be satisfied as to the terms and
conditions of the obligation by a former owner of the
Properties to reimburse certain costs and expenses relative
to the environmental assessment, containment and remediation
of the Properties, including, without limitation, the funds
which have been deposited in connection therewith. The
Borrower's interest in the account into which such funds have
been deposited shall be pledged to the Lender as additional
and collateral security for the Obligations.
(5) Structural and Building Inspection Report For the
specific Properties as requested by Lender, a structural inspection
report completed by an engineer approved by Lender, with respect to
the acceptable condition of the Improvements comprising the Properties
and all building systems.
(6) Form Leases. The standard form of commercial and
residential Lease to be used by the Borrower in connection with the
Improvements.
(7) Depository Account. Borrower will establish the
Depository Accounts with the Depository Account Banks and cause the
Depository Account Bank to deliver the Depository Account Letter to
the Lender.
(8) Other Accounts. Borrower will establish the Cash Flow
Account with the Lender.
(9) Management Contracts.
(1) Each Management Contract, together with an
agreement executed by the Management Company providing for
the (1) consent to the assignment of the Management Contract
to the Lender, (2) recognition of the Lender or any successor
in the event of the exercise by the Lender of its rights,
upon the occurrence of an Event of Default,(3) right of the
Lender to terminate the Management Contract upon thirty (30)
days notice upon the occurrence of an Event of Default,
without the payment of any termination fee or other charge,
and (4) agreement by the Management Company to deposit any
and all payments due to the Borrower in the Depository
Account.
(2) To the extent that any Gross Cash Receipts,
other proceeds of Collateral or other proceeds from the
operation, ownership and development of the Project, are
deposited in accounts maintained by the Management Company,
such documents, instruments and
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agreements as may be required by the Lender to grant to the
Lender a perfected pledge and security interest in the said
accounts to secure the Obligations.
9.9 Legal and Other Opinions. The Lender shall have received favorable
opinions in form and substance satisfactory to the Lender and the Lender's
counsel, addressed to the Lender and dated as of the Closing Date, from counsel
to the Borrower acceptable to the Lender, as to such matters as the Lender
shall reasonably request.
9.10 Lien Search. The Lender shall have received a certification from
Title Insurance Company or counsel satisfactory to the Lender (which shall be
updated from time to time at the Borrower's expense upon request by the Lender)
that a search of the public records disclosed no conditional sales contracts,
security agreements, chattel mortgages, leases of personalty, financing
statements or title retention agreements which affect the Collateral.
9.11 Appraised Value. The Lender shall have determined that the
Project has an Appraised Value of at least $21,900,000.00.
9.12 Debt Service Charges. The financial reports for the period ending
with the first calendar quarter of 1998 shall evidence an Operating Cash Flow
(as determined in a manner satisfactory to the Lender) for the prior four (4)
fiscal quarters not less than 175% of Pro-Forma Debt Service Charge (as
determined in a manner satisfactory to the Lender) for the next four (4)
calendar quarters.
9.13 Commitment Fee. The Borrower shall have paid to the Lender the
commitment fee pursuant to ss.4.1.
9.14 Performance; No Default. The Borrower shall have performed and
complied with all terms and conditions herein required to be performed or
complied with by it on or prior to the Advance of the proceeds of the Loan, and
there shall exist no Default or Event of Default.
9.15 Representations and Warranties. The representations or warranties
made by the Obligors in the Loan Documents or otherwise made by or on behalf of
the Obligors in connection therewith shall have been true and correct in all
respects when made and shall be true and correct in all respects on the date of
any Advances.
9.16 Proceedings and Documents. All proceedings in connection with the
transactions contemplated by this Agreement and the other Loan Documents shall
be satisfactory to the Lender and the Lender's counsel in form and substance,
and the Lender shall have received all information and such counterpart
origi-
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nals or certified copies of such documents and such other certificates,
opinions or documents as the Lender and the Lender's counsel may reasonably
require.
9.17 Waiver. Any written waiver by the Lender of any of the conditions
precedent contained herein for the Closing and any Advance shall not be deemed
to be a waiver by the Lender of such conditions precedent for any subsequent
Advance, if any, or any other obligation of the Lender hereunder.
10. EVENTS OF DEFAULT AND REMEDIES.
10.1 Events of Default. The occurrence of any one or more of the
following conditions or events shall constitute an "Event of Default":
(1) any failure by the Borrower to pay, within ten (10)
Business Days of the due date, any interest on or principal of or
other sum payable under the Note; or
(2) any failure by the Borrower to pay as and when due and
payable any other sums to be paid by the Borrower to the Lender under
this Agreement and the continuance of such failure for a period of ten
(10) days after notice thereof from the Lender; or
(3) title to the Collateral is or becomes unsatisfactory to
the Lender by reason of any lien, charge, encumbrance, title condition
or exception (other than as provided for in the Title Policy), and
such matter causing title to be or become unsatisfactory is not cured
or removed (including by bonding) within thirty (30) days after notice
thereof from the Lender to the Borrower, provided, however, in the
event that the cure of any such matter by its nature cannot be
accomplished within said thirty (30) day period, such matter shall not
be an Event of Default until the expiration of an additional sixty
(60) days without the cure thereof if (i) the Borrower commences the
cure thereof within the initial thirty (30) day period and (ii)
diligently pursues such cure; or
(4) any refusal by the Title Insurance Company to insure any
Advance as being secured by the Security Deed as a valid first lien
and security interest on the Project and continuance of such refusal
for a period of twenty (20) days after notice thereof by the Lender to
the Borrower; or
(5) the Project, or any part thereof having a value as
determined by the Lender in excess of $1,000,000.00, is injured by an
uninsured fire, explosion, accident, flood or other casualty; or
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(6) any failure by the Borrower to duly observe or perform
any term, covenant, condition or agreement contained in ss.8.9 hereof
and such failure is not cured within thirty (30) days after notice
thereof from the Lender to the Borrower, provided, however, in the
event that the cure of any such failure by its nature cannot be
accomplished within said thirty (30) day period, such failure shall
not be an Event of Default until the expiration of an additional sixty
(60) days without the cure thereof if (i) the Borrower commences the
cure thereof within the initial thirty (30) day period and (ii)
diligently pursues such cure; or
(7) any representation or warranty made or deemed to be made
by or on behalf of any Obligor in this Agreement or in any of the
other Loan Documents, or in any report, certificate, financial
statement, document or other instrument delivered pursuant to or in
connection with this Agreement, any Advance or any of the other Loan
Documents, shall prove to have been false or incorrect in any material
respect upon the date when made or deemed to be made or repeated; or
(8) any dissolution, termination, partial or complete
liquidation, merger or consolidation of any Obligor, or any sale,
transfer or other disposition of all or substantially all of the
assets of any Obligor, other than as permitted under the terms of this
Agreement; or
(9) any change in the legal or beneficial ownership of any
Obligor; or
(10) any change in the control of the management of any
Obligor, or the giving up or relinquishment of such control by the
Person(s) who is(are) charged with the exercise of such
responsibilities on the date hereof; or
(11) any failure by any Obligor to pay at maturity, or within
any applicable period of grace, any obligation for borrowed money or
credit received, or any failure to observe or perform any material
term, covenant or agreement contained in any agreement by which it is
bound evidencing or securing borrowed money or credit received, for
such period of time as would permit (assuming the giving of
appropriate notice if required) the holder or holders thereof to
accelerate the maturity thereof, if the consequences of such failure
have had or will have (in the Lender's reasonable judgement) a
materially adverse effect on the said Obligor; or
(12) any Obligor shall file a voluntary petition in
bankruptcy under Title 11 of the United States Code, or an order for
relief shall be issued against any such Person in
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any involuntary petition in bankruptcy under Title 11 of the United
States Code, or any such Person shall file any petition or answer
seeking or acquiescing in any reorganization, arrangement,
composition, readjustment, liquidation, dissolution or similar relief
for itself under any present or future federal, state or other law or
regulation relating to bankruptcy, insolvency or other relief of
debtors, or such Person shall seek or consent to or acquiesce in the
appointment of any custodian, trustee, receiver, conservator or
liquidator of such Person, or of all or any substantial part of its
respective property, or such Person shall make an assignment for the
benefit of creditors, or such Person shall give notice to any
governmental authority or body of insolvency or pending insolvency or
suspension of operation; or
(13) the (i) filing of an involuntary petition against any
Obligor under Title 11 of the United States Code or seeking any other
reorganization, arrangement, composition, readjustment, liquidation or
similar relief under any present or future federal, state or other law
or regulation relating to bankruptcy, insolvency or other relief for
debtors, or appointing any custodian, trustee, receiver, conservator
or liquidator of all or any substantial part of its property and (ii)
the expiration of sixty (60) days from such filing without the
dismissal thereof; or
(14) any uninsured final judgment shall be rendered against
any the Borrower and shall remain in force, undischarged, unsatisfied
and unstayed, for more than sixty (60) days, whether or not
consecutive; provided, however, only if the amount of such final
judgement (after the expiration of any applicable appeal period) is in
excess of $500,000.00 for the Borrower; or
(15) any of the Loan Documents shall be canceled, terminated,
revoked or rescinded otherwise than in accordance with the terms
thereof or with the express prior approval of the Lender, or any
action at law, suit in equity or other legal proceeding to cancel,
revoke or rescind any of the Loan Documents shall be commenced by or
on behalf of the Borrower or any Obligor which is a party thereto or
any of their respective stockholders, partners or beneficiaries, or
any court or any other governmental or regulatory authority or agency
of competent jurisdiction shall make a determination that, or issue a
judgment, order, decree or ruling to the effect that, any one or more
of the Loan Documents is illegal, invalid or unenforceable in
accordance with the terms thereof; or
(16) any failure by any Obligor to duly observe or perform
any other term, covenant, condition or agreement
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under this Agreement and continuance of such failure for a period of
thirty (30) days after notice thereof from the Lender provided,
however, in the event that the cure of any such failure by its nature
cannot be accomplished within said thirty (30) day period, such
failure shall not be an Event of Default until the expiration of an
additional sixty (60) days without the cure thereof if (i) the Obligor
commences the cure thereof within the initial thirty (30) day period
and (ii) diligently pursues such cure; or
(17) any "Event of Default", as defined in any of the other
Loan Documents, shall occur.
10.2 Termination of Advances and Acceleration. If any one or more of
the Events of Default shall occur, the Lender may by notice to the Borrower
declare its obligations to make Advances hereunder to be terminated, whereupon
the same shall terminate and the Lender shall be relieved of all obligations to
make Advances to the Borrower, and/or declare all unpaid principal of and
accrued interest on the Note, together with all other amounts owing under the
Loan Documents, to be immediately due and payable, whereupon same shall become
and be immediately due and payable, anything in the Loan Documents to the
contrary notwithstanding, and without presentment, protest, demand or other
notice of any kind, all of which are hereby expressly waived by the Borrower;
provided that if any one or more of the Events of Default specified in
ss.10.1(l),or ss.10.1(m), above, shall occur with respect to any Obligor, the
Lender's obligations to make Advances hereunder automatically shall so
terminate and all unpaid principal of and accrued interest on the Note,
together with all other amounts owing under the Loan Documents, automatically
shall become and be immediately so due and payable, without any declaration or
other act on the part of the Lender.
10.3 Remedies. If any one or more of the Events of Default shall have
occurred, and whether or not the Lender shall have terminated its obligations
to make Advances or accelerated the maturity of the Loan pursuant to ss.10.2
the Lender may, during the continuance thereof, proceed to protect and enforce
its rights and remedies under this Agreement, the Note or any of the other Loan
Documents by suit in equity, action at law or other appropriate proceeding,
whether for the specific performance of any covenant or agreement contained in
this Agreement and the other Loan Documents or any instrument pursuant to which
the Obligations are evidenced, including as permitted by applicable law the
obtaining of the ex parte appointment of a receiver, and, if any amount owed to
the Lender shall have become due, by declaration or otherwise, proceed to
enforce the payment thereof or any other legal or equitable right of the
Lender. No remedy conferred upon the Lender or the holder of the Note in this
Agreement or in any of the other Loan Documents is intended to be exclusive of
any other remedy and each and every remedy shall be
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cumulative and shall be in addition to every other remedy given hereunder or
thereunder or now or hereafter existing at law or in equity or by statute or
any other provision of law.
10.4 Distribution of Collateral Proceeds. In the event that, following
the occurrence and only during the continuance of any Default or Event of
Default, the Lender receives any monies in connection with the enforcement of
any the Security Documents, or otherwise with respect to the realization upon
any of the Collateral, such monies shall be distributed for application as
follows:
(1) First, to the payment of, or (as the case may be) the
reimbursement of the Lender for or in respect of all reasonable costs,
expenses, disbursements and losses which shall have been incurred or
sustained by the Lender in connection with the collection of such
monies by the Lender, for the exercise, protection or enforcement by
the Lender of all or any of the rights, remedies, powers and
privileges of the Lender under this Agreement or any of the other Loan
Documents or in respect of the Collateral or in support of any
provision of adequate indemnity to the Lender against any taxes or
liens which by law shall have, or may have, priority over the rights
of the Lender to such monies;
(2) Second, to all other Obligations in such order or
preference as the Lender may determine; provided, however, that the
Lender may in its discretion make proper allowance to take into
account any Obligations not then due and payable;
(3) Third, upon payment and satisfaction in full or other
provisions for payment in full satisfactory to the Lender of all of
the Obligations, to the payment of any obligations required to be paid
pursuant to ss.9-504(1)(c) of the Uniform Commercial Code of the
Commonwealth of Massachusetts; and
(4) Fourth, the excess, if any, shall be returned to the
Borrower or to such other Persons as are entitled thereto.
10.5 Power of Attorney. For the purposes of carrying out the
provisions and exercising the rights, remedies, powers and privileges granted
by or referred to in this Article after the occurrence of an Event of Default
and only during the continuance thereof, the Borrower hereby irrevocably
constitutes and appoints the Lender its true and lawful attorney-in-fact, with
full power of substitution, to execute, acknowledge and deliver any instruments
and do and perform any acts which are referred to in this Article, in the name
and on behalf of the Borrower. The
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power vested in such attorney-in-fact is, and shall be deemed to be, coupled
with an interest and irrevocable.
10.6 Waivers. The Borrower hereby waives to the extent not prohibited
by applicable law (a) all presentments, demands for performance, notices of
nonperformance (except to the extent required by the provisions hereof or of
any of the other Loan Documents), protests and notices of dishonor, (b) any
requirement of diligence or promptness on the Lender's part in the enforcement
of its rights (but not fulfillment of its obligations) under the provisions of
this Agreement or any of the other Loan Docu ments, and (c) any and all notices
of every kind and description which may be required to be given by any statute
or rule of law and any defense of any kind which the Borrower may now or
hereafter have with respect to its liability under this Agreement or under any
of the other Loan Documents.
11. SETOFF. Regardless of the adequacy of any collateral, during the
continuance of any Event of Default, any deposits (general or
specific, time or demand, provisional or final, regardless of
currency, maturity, or the branch of the Lender where such deposits
are held, however, exclusive of any deposits in the Borrower's name as
agent or fiduciary for any other Person) or other sums credited by or
due from the Lender to the Borrower and any securities or other
property of the Borrower in the possession of the Lender may be
applied to or set off against the payment of the Obligations and any
and all other Obligations.
12. EXPENSES. The Borrower agrees to pay (a) the reasonable costs of
producing this Agreement, the other Loan Documents and the other
agreements and instruments mentioned herein, (b) any taxes (including
any interest and penalties in respect thereto) payable by the Lender
(other than taxes based upon the Lender's net income, franchise taxes
or doing business taxes), including any recording, mortgage or
intangibles taxes in connection with the Security Deed, or other taxes
payable on or with respect to the transactions contemplated by this
Agreement, including any taxes payable by the Lender after the Closing
Date (the Borrower hereby agreeing to indemnify the Lender with
respect thereto), (c) all title insurance premiums, and the reasonable
fees, expenses and disbursements of the Lender's counsel or any local
counsel to the Lender incurred in connection with the preparation,
administration or interpretation of the Loan and the Loan Documents
and other instruments mentioned herein, the making of each Advance
hereunder, and amendments, modifications, approvals, consents or
waivers hereto or hereunder, (d) the fees, expenses and disbursements
of the Lender incurred in connection with the preparation,
administration or interpretation of the Loan and the Loan Documents
and other instruments mentioned
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herein, and the making of each Advance hereunder (including all
Appraisal fees and surveyor fees) (e) all reasonable out-of-pocket
expenses (including reasonable attorneys' fees and costs, which
attorneys may be employees of the Lender, but excluding any other
internal costs or overhead charges of Lender) and the fees and costs
of consultants, accountants, auctioneers, receivers, brokers, property
managers, appraisers, investment bankers or other experts retained by
the Lender in connection with (i) the enforcement of or preservation
of rights under any of the Loan Documents against the Borrower or any
Obligor or the administration thereof after the occurrence of a
Default or Event of Default and only during the continuance thereof,
and (ii) any litigation, proceeding or dispute whether arising
hereunder or otherwise, in any way related to the Lender's
relationship with the Borrower or any Party, and (f) all reasonable
fees, expenses and disbursements of the Lender incurred in connection
with UCC searches, UCC filings, title rundowns, title searches or
mortgage recordings. The covenants of this Section shall survive
payment or satisfaction of payment of all amounts owing with respect
to the Note.
13. INDEMNIFICATION. The Borrower agrees to indemnify and hold harmless
the Lender from and against any and all claims, actions and suits,
whether groundless or otherwise, and from and against any and all
liabilities, losses, damages and expenses of every nature and
character arising out of this Agreement or any of the other Loan
Documents or the transactions contemplated hereby and thereby
including, without limitations, (a) any brokerage, leasing, finders or
similar fees, (b) any disbursement of the proceeds of any of the
Advances, (c) any condition of the Project whether related to the
quality of construction or otherwise, (d) any actual or proposed use
by the Borrower of the proceeds of any of the Advances, (e) any actual
or alleged violation of any Requirements or Project Approvals, or (f)
the Borrower or any Party entering into or performing this Agreement
or any of the other Loan Documents, in each case including, without
limitation, the reasonable fees and disbursements of counsel and
allocated costs of internal counsel incurred in connection with any
such investigation, litigation or other proceeding; provided, however,
that nothing herein shall be construed to obligate Borrower to
indemnify, defend and hold harmless Lender from and against any and
all liabilities, obligations, losses, damages, penalties, claims,
actions, suits, costs and expenses enacted against, imposed on or
incurred by Lender by reason of Lender's willful misconduct or gross
negligence. In litigation, or the preparation therefor, the Lender
shall be entitled to select its own counsel and, in addition to the
foregoing indemnity, the Borrower agrees to pay promptly the
reasonable fees and
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expenses of such counsel. The obligations of the Borrower under this
Section shall survive the repayment of the Loan and shall continue in
full force and effect with respect to any claim, action or suit made
upon the Lender on or before one (1) year after the date of the
repayment of the Loan. If, and to the extent that the obligations of
the Borrower under this Section are unenforceable for any reason, the
Borrower hereby agrees to make the maximum contribution to the payment
in satisfaction of such obligations which is permissible under
applicable law.
14. RIGHTS OF THIRD PARTIES. All conditions to the performance of the
obligations of the Lender under this Agreement, including the
obligation to make Advances, are imposed solely and exclusively for
the benefit of the 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 the Lender will refuse to make Advances
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 and all of which may be freely
waived in whole or in part by the Lender at any time if in its sole
discretion it deems it desirable to do so. In particular, the Lender
makes no representations and assumes no obligations as to third
parties concerning the quality of the construction by the Borrower of
the Improvements or the absence therefrom of defects.
15. SURVIVAL OF COVENANTS, ETC. All covenants, agreements, representations
and warranties made herein, in the Note, in any of the other Loan
Documents or in any documents or other papers delivered by or on
behalf of the Borrower or any Party pursuant hereto and thereto shall
be deemed to have been relied upon by the Lender, notwithstanding any
investigation heretofore or hereafter made by it, and shall survive
the making by the Lender of the Advances, as herein contemplated, and
shall continue in full force and effect either (i) so long as any
amount due under this Agreement or the Note or any of the other Loan
Documents remains outstanding or the Lender has any obligation to make
any Advances or (ii) for such longer period as may be provided for
herein or in any other Loan Document. All statements contained in any
certificate or other paper delivered to the Lender at any time by or
on behalf of any Party or any Subsidiary thereof pursuant hereto or in
connection with the transactions contemplated hereby shall constitute
representations and warranties by such Person.
16. ASSIGNMENT AND PARTICIPATION.
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16.1 Conditions to Assignment by Lender. Except as provided herein,
the Lender may assign to one or more banks or other entities all or a portion
of its interests, rights and obligations under this Agreement. From and after
the effective date of any such assignment and notice thereof to the Borrower,
(i) the assignee thereunder shall be deemed to be a party hereto and, to the
extent agreed to by the Lender, have the rights and obligations of a Lender
hereunder, and (ii) the Lender shall, to the extent of its interest assigned as
provided herein, be released from its obligations under this Agreement arising
from and after the date of such assignment.
16.2 New Notes, Agreement. Upon any such assignment by the Lender, the
Borrower, at its own expense, shall execute and deliver to the Lender (a) in
exchange for the Note, a new Note to the order of such assignee in an amount
equal to the amount assumed by such assignee and, if the Lender has retained
some portion of its obligations hereunder, a new Note to the order of the
Lender in an amount equal to the amount retained by it hereunder and (b) an
amendment to this Agreement and any other Loan Documents, as may be reasonably
requested by the Lender, to evidence the assignment, provide for the rights and
interest of the assignee, and establish the rights, responsibilities and
obligations of the Lender as agent for itself and any such assignee. Such new
Notes shall provide that they are replacements for the surrendered Notes, shall
be in an aggregate principal amount equal to the aggregate principal amount of
the surrendered Notes, shall be dated the effective date of such assignment and
shall otherwise be in substantially the form of the assigned Notes. The
surrendered Notes shall be canceled and returned to the Borrower.
16.3 Participations. The Lender may sell participations to one or more
banks or other entities in all or a portion of the Lender's rights and
obligations under this Agreement and the other Loan Documents; provided that
(a) any such sale of participations shall not affect the rights and duties of
the Lender hereunder to the Borrower and (b) the only rights granted to the
participant pursuant to such participation arrangements with respect to
waivers, amendments or modifications of the Loan Documents shall be the right
to approve waivers, amendments or modifications that would reduce the principal
of or the interest rate on the Loan, extend the term or increase the amount of
the Loan or extend any regularly scheduled payment date for principal or
interest.
16.4 Pledge by the Lender. The Lender may at any time pledge all or
any portion of its interest and rights under this Agreement (including all or
any portion of the Note) to any of the twelve Federal Reserve Banks organized
under ss.4 of the Federal Reserve Act, 12 U.S.C. ss.341. No such pledge or the
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enforcement thereof shall release the Lender from its obligations hereunder or
under any of the other Loan Documents.
16.5 No Assignment by the Borrower. The Borrower shall not assign or
transfer any of its rights or obligations under any of the Loan Documents
without the prior approval of the Lender.
17. RELATIONSHIP. The relationship between the Lender and the Borrower is
solely that of a lender and borrower, and nothing contained herein or
in any of the other Loan Documents shall in any manner be construed as
making the parties hereto partners, joint venturers or any other
relationship other than lender and borrower.
18. NOTICES. Except as otherwise provided herein or in any other Loan
Document, each notice, demand, election or request provided for or
permitted to be given pursuant to this Agreement or any other Loan
Document (hereinafter in this Section referred to as "Notice") must be
in writing and shall be deemed to have been properly given or served
by personal delivery or by sending same by overnight courier or by
depositing same in the United States Mail, postpaid and registered or
certified, return receipt requested, and addressed as follows:
If to the Lender;
BankBoston, N.A.
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: Real Estate Division
With a copy to:
▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, Esquire
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If to the Borrower:
▇▇▇▇▇▇▇▇▇ Associates
▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇ Associates Realty Trust
▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
With a copy to:
Post & ▇▇▇▇▇▇▇, LLP
▇▇▇▇▇ ▇▇▇
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇▇ ▇. Post, Esquire
Each Notice shall be effective upon being personally delivered or upon being
sent by overnight courier or upon being deposited in the United States Mail as
aforesaid. The time period in which a response to such Notice must be given or
any action taken with respect thereto (if any), however, shall commence to run
from the date of receipt if personally delivered or sent by overnight courier,
or if so deposited in the United States Mail, the earlier of three (3)
Business Days following such deposit or the date of receipt as disclosed on
the return receipt. Rejection or other refusal to accept or the inability to
deliver because of changed address for which no Notice was given shall be
deemed to be receipt of the Notice sent. By giving at least thirty (30) days
prior Notice thereof, the Borrower or the Lender shall have the right from
time to time and at any time during the term of this Agreement to change their
respective addresses and each shall have the right to specify as its address
any other address within the United States of America.
19. GOVERNING LAW. This Agreement and each of the other Loan Documents,
except as otherwise specifically provided therein, are contracts under
the laws of the Commonwealth of Massachusetts and shall for all
purposes be construed in accordance with and governed by the laws of
said Commonwealth (excluding the laws applicable to conflicts or
choice of law).
20. CONSENT TO JURISDICTION; WAIVERS. THE BORROWER AND EACH PARTY HEREBY
IRREVOCABLY AND UNCONDITIONALLY (A) SUBMITS TO PERSONAL JURISDICTION
IN THE COMMONWEALTH OF MASSACHUSETTS OVER ANY SUIT, ACTION OR
PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OF THE
OTHER LOAN
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DOCUMENTS, AND (B) WAIVES ANY AND ALL PERSONAL RIGHTS UNDER THE LAWS
OF ANY STATE (I) TO THE RIGHT, IF ANY, TO TRIAL BY JURY, AND (II) TO
OBJECT TO JURISDICTION WITHIN THE COMMONWEALTH OF MASSACHUSETTS OR
VENUE IN ANY PARTICULAR FORUM WITHIN THE COMMONWEALTH OF
MASSACHUSETTS. NOTHING CONTAINED HEREIN, HOWEVER, SHALL PREVENT THE
LENDER FROM BRINGING ANY SUIT, ACTION OR PROCEEDING OR EXERCISING ANY
RIGHTS AGAINST ANY COLLATERAL AND AGAINST THE BORROWER, AND AGAINST
ANY PROPERTY OF THE BORROWER, IN ANY OTHER STATE. INITIATING SUCH
SUIT, ACTION OR PROCEEDING OR TAKING SUCH ACTION IN ANY STATE SHALL IN
NO EVENT CONSTITUTE A WAIVER OF THE AGREEMENT CONTAINED HEREIN THAT
THE LAWS OF THE COMMONWEALTH OF MASSACHUSETTS SHALL GOVERN THE RIGHTS
AND OBLIGATIONS OF THE BORROWER, EACH PARTY, AND THE LENDER HEREUNDER
OR THE SUBMISSION HEREIN BY THE BORROWER AND EACH PARTY TO PERSONAL
JURISDICTION WITHIN THE COMMONWEALTH OF MASSACHUSETTS.
21. HEADINGS. The captions in this Agreement are for convenience of
reference only and shall not define or limit the provisions hereof.
22. COUNTERPARTS. This Agreement and any amendment hereof may be executed
in several counterparts and by each party on a separate counterpart,
each of which when so executed and delivered shall be an original, and
all of which together shall constitute one instrument. In proving this
Agreement it shall not be necessary to produce or account for more
than one such counterpart signed by the party against whom enforcement
is sought.
23. ENTIRE AGREEMENT, ETC. The Loan Documents and any other documents
executed in connection herewith or therewith express the entire
understanding of the parties with respect to the transactions
contemplated hereby. Neither this Agreement nor any term hereof may be
changed, waived, discharged or terminated, except as provided in
Article 24.
24. CONSENTS, AMENDMENTS, WAIVERS, ETC. Except as otherwise expressly set
forth in any particular provision of this Agreement, any consent or
approval required or permitted by this Agreement to be given by the
Lender may be given, and any term of this Agreement or of any other
instrument related hereto or mentioned herein may be amended, and the
performance or observance by the Borrower of any terms of this
Agreement or such other instrument or the continuance of any Default
or Event of Default may be waived (either generally or in a particular
instance and either retroactively or prospectively) with, but only
with, the written consent of the Lender. No waiver shall extend to or
affect any obligation not expressly waived or impair any right
consequent thereon. No course of dealing or delay or
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omission on the part of the Lender in exercising any right shall
operate as a waiver thereof or otherwise be prejudicial thereto. No
Advance made by the Lender hereunder during the continuance of any
Default or Event of Default shall constitute a waiver thereof. No
notice to or demand upon the Borrower shall entitle the Borrower to
other or further notice or demand in similar or other circumstances.
25. TIME OF THE ESSENCE. Time is of the essence with respect to each and
every covenant, agreement and obligation of the Borrower under this
Agreement and the other Loan Documents.
26. SEVERABILITY. The provisions of this Agreement are severable, and if
any one clause or provision hereof shall be held invalid or
unenforceable in whole or in part in any jurisdiction, then such
invalidity or unenforceability shall affect only such clause or
provision, or part thereof, in such jurisdiction, and shall not in any
manner affect such clause or provision in any other jurisdiction, or
any other clause or provision of this Agreement in any jurisdiction.
27. NONRECOURSE LOAN. EXCEPT AS PROVIDED IN 28 BELOW AND AS PROVIDED IN
THE GUARANTY AND THE INDEMNITY AGREEMENT, NOTWITHSTANDING ANY TERMS OR
PROVISIONS HEREOF OR IN ANY OTHER LOAN DOCUMENTS TO THE CONTRARY, THE
RIGHTS OF THE LENDER HEREUNDER ARE LIMITED TO THE BORROWER'S RIGHT,
TITLE AND INTEREST IN ANY COLLATERAL IN WHICH THE LENDER HAS BEEN, OR
MAY BE, EXPRESSLY GRANTED AN INTEREST BY THE BORROWER PURSUANT TO ANY
OF THE LOAN DOCUMENTS, WITH NO FURTHER RECOURSE AVAILABLE HEREUNDER
AGAINST THE BORROWER, OR ANY PARTNER, TRUSTEE, BENEFICIARY,
SHAREHOLDER OR DIRECTOR OF THE BORROWER OR OF ANY PARTNER OR
BENEFICIARY OF THE BORROWER, THE LENDER AGREEING TO LOOK SOLELY TO
SUCH COLLATERAL FOR THE INDEBTEDNESS EVIDENCED BY THE LOAN DOCUMENTS.
28. Limited Recourse to Exculpated Party. Except as provided in the
Indemnity Agreement and the Guaranty, the Loan shall be on a limited
recourse basis to the Borrower, the partners of ▇▇▇▇▇▇▇▇▇ and the
beneficiaries of the Trust. The Borrower, the partners of ▇▇▇▇▇▇▇▇▇
and the beneficiaries of the Trust(each of whom is an "Exculpated
Party"), shall be exculpated from all personal liability for the
payment of interest on and principal of the Loan and for the
performance of any of the terms and conditions contained in any of the
Loan Documents and shall have no liability thereunder except for the
following:
(1) an Exculpated Party shall be liable for a
willful breach by such Exculpated Party of the
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provisions limiting payments or distributions by the
Borrower;
(2) an Exculpated Party shall be liable for fraud by
such Exculpated Party;
(3) an Exculpated Party shall be liable for any
breach of warranty or misrepresentation by such Exculpated
Party which was known to be false when made; and
(4) an Exculpated Party shall be liable for any
misappropriation of the proceeds of the Loan, insurance
proceeds from any casualty or loss, proceeds of any
condemnation award, Gross Cash Receipts, received by such
Exculpated Party or paid or disbursed by such Exculpated
Party, in breach of the terms and provisions of the Loan
Documents.
IN WITNESS WHEREOF, the undersigned have duly executed this Agreement
as a sealed instrument as of the date first set forth above.
▇▇▇▇▇▇▇▇▇ ASSOCIATES, a Massachusetts general
partnership
By: NIA OPERATING ASSOCIATES LIMITED PARTNERSHIP,
general partner
By: NANTUCKET ISLAND ASSOCIATES LIMITED
PARTNERSHIP, general partner
By: THREE WINTHROP PROPERTIES,
INC., a Massachusetts
corporation, general partner
By:
-------------------------
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Senior Vice President
By: THREE WINTHROP PROPERTIES, INC., a
Massachusetts corporation, general partner
By:
-----------------------------
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Senior Vice President
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▇▇▇▇▇▇▇▇▇ ASSOCIATES REALTY TRUST, a Massachusetts
nominee realty trust
By:
---------------------------------------------------
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, as trustee of ▇▇▇▇▇▇▇▇▇
ASSOCIATES REALTY TRUST, and not individually
BANKBOSTON, N.A.
By:
----------------------------------------------------
Title
The undersigned joins this Agreement for the purpose of agreeing to
provide the financial information as set forth in 7.4, hereof.
NANTUCKET ISLAND ASSOCIATES LIMITED PARTNERSHIP,
general partner
By: THREE WINTHROP PROPERTIES, INC., a
Massachusetts corporation, general partner
By:
--------------------------------
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Senior Vice President
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Exhibit A
Principal Amortization Schedules
Exhibit B
Interest Terms and Provisions
Exhibit C
Covenant Compliance Worksheet and Certificate
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Schedule 6.3
Financial Statements Furnished
Schedule 6.5
Litigation
Schedule 6.12
Partners, Beneficiaries, Etc.
Schedule 6.17
Project Approval
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