Recourse. (a) Subject to the qualifications herein, Lender shall not enforce Borrower’s obligation to pay the Indebtedness by any action or proceeding wherein a deficiency judgment or other judgment establishing personal liability shall be sought against Borrower or any of its affiliates, or any Exculpated Person, except for foreclosure actions or any other appropriate actions or proceedings against Borrower in order to fully exercise Lender’s remedies in respect of, and to realize upon, the Collateral, and except for any actions to enforce any obligations expressly assumed or guaranteed by any guarantor, indemnitor or similar party (whether or not such party is an Exculpated Person) under the Loan Documents; provided however such foreclosure or appropriate actions or proceedings against Borrower shall, in no event, seek to enforce Borrower’s obligation to pay the Indebtedness or other personal judgments against Borrower. (b) Borrower shall indemnify Lender and hold Lender harmless from and against any and all Damages to Lender (including the legal and other expenses of enforcing the obligations of Borrower under this Section and Sponsor under the Guaranty) resulting from or arising out of any of the following: (i) any intentional physical Waste at the Property committed or permitted by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor; (ii) any fraud or intentional misrepresentation in connection with the Loan committed by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor; (iii) any willful misconduct by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor (including any bad faith interference by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor with the exercise any rights and remedies available to Lender as provided herein and in the other Loan Documents during the continuance of an Event of Default); (iv) the misappropriation or misapplication by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor of any funds in violation of the Loan Documents (including misappropriation or misapplication of Revenues, security deposits and/or Loss Proceeds); (v) any voluntary Debt incurred by Borrower if and to the extent the continued existence of such Debt is prohibited hereunder; (vi) the failure to pay or maintain the Policies or pay the amount of any deductible required thereunder following a Casualty or other insurance claim, provided that current cash flow is sufficient and available pursuant to the Approved Management Agreement for payment of same and provided Lender permits cash flow from the Property to be applied for such purpose; (vii) the failure of Borrower to be, and to at all times have been, a Single-Purpose Entity, regardless of whether such failure to have been a Single-Purpose Entity prior to the date hereof has been disclosed to Lender, and including any and all liabilities, contingent or otherwise, arising from or related to (x) the actions, conduct and/or operating history of Borrower (or any Person merged into Borrower) prior to the Closing Date and (y) Borrower’s ownership (or the ownership of any Person merged into Borrower) of assets prior to the Closing Date that do not constitute a portion of the Collateral; (viii) removal of personal property by Borrower from the Property outside of the ordinary course of business during the continuance of an Event of Default in violation of the Loan Agreement, unless replaced with personal property of the same utility and of the same or greater value and utility; and (ix) any fees or commissions paid by Borrower to any affiliate in violation of the terms of the Loan Documents. In addition to the foregoing, the Loan shall be fully recourse to Borrower and Sponsor, jointly and severally, if (i) there is any unauthorized Transfer of the Property or any other Collateral (including voluntary Liens and encumbrances on the Collateral other than Permitted Encumbrances) or Prohibited Change of Control or Prohibited Pledge, in each case, in violation of the Loan Documents, (ii) any petition for bankruptcy, insolvency, dissolution or liquidation under the Bankruptcy Code or any similar federal or state law is filed by, consented to, or acquiesced in by, Borrower, (iii) Borrower or any of its affiliates (including Sponsor) shall have colluded with other creditors to cause an involuntary filing under the Bankruptcy Code or similar federal or state law with respect to Borrower, or Borrower shall have terminated one or more of the Independent Directors for the purpose of facilitating a bankruptcy filing, or (iv) Borrower fails to be, and to at all times have been, a Single-Purpose Entity, which failure results in a substantive consolidation of Borrower with any affiliate in a bankruptcy or similar proceeding. All of Borrower’s liabilities under this Section 9.19(b) shall be guaranteed by Sponsor pursuant to the Guaranty. (c) The foregoing limitations on personal liability shall in no way impair or constitute a waiver of the validity of the Notes, the Indebtedness secured by the Collateral, or the Liens on the Collateral, or the right of Lender, as mortgagee or secured party, to foreclose and/or enforce its rights with respect to the Collateral after an Event of Default. Nothing in this Agreement shall be deemed to be a waiver of any right which Lender may have under the Bankruptcy Code to file a claim for the full amount of the debt owing to Lender by Borrower or to require that all Collateral shall continue to secure all of the Indebtedness owing to Lender in accordance with the Loan Documents. Lender may seek a judgment on the Note (and, if necessary, name Borrower in such suit) as part of judicial proceedings to foreclose on any Collateral or as a prerequisite to any such foreclosure or to confirm any foreclosure or sale pursuant to power of sale thereunder, and in the event any suit is brought on the Note(s), or with respect to any Indebtedness or any judgment rendered in such judicial proceedings, such judgment shall constitute a Lien on and may be enforced on and against the Collateral and the rents, profits, issues, products and proceeds thereof. Nothing in this Agreement shall impair the right of Lender to accelerate the maturity of the Note during the continuance of an Event of Default in accordance with the Loan Documents, nor shall anything in this Agreement impair or be construed to impair the right of Lender to seek personal judgments, and to enforce all rights and remedies under applicable law, jointly and severally against any indemnitors and guarantors to the extent allowed by any applicable Loan Documents. The provisions set forth in this Section are not intended as a release or discharge of the obligations due under the Note or under any Loan Documents, but are intended as a limitation, to the extent provided in this Section, on Lender’s right to ▇▇▇ for a deficiency or seek a personal judgment except as required in order to realize on the Collateral. (d) For the avoidance of doubt, the failure to pay trade payables as a result of insufficient cash flow from the Property shall not trigger liability under this Section 9.19.
Appears in 1 contract
Sources: Loan Agreement (Aspen REIT, Inc.)
Recourse. (a) Subject to the qualifications herein, Lender shall not enforce Borrower’s obligation to pay the Indebtedness by any action or proceeding wherein a deficiency judgment or other judgment establishing personal liability shall be sought against Borrower or any of its affiliatesAffiliates, or any Exculpated Person, except for foreclosure actions or any other appropriate actions or proceedings against Borrower in order to fully exercise Lender’s remedies in respect of, and to realize upon, the Collateral, and except for any actions to enforce any obligations expressly assumed or guaranteed by any guarantor, indemnitor or similar party (whether or not such party is an Exculpated Person) under the Loan Documents; provided however such foreclosure or appropriate actions or proceedings against Borrower shall, in no event, seek to enforce Borrower’s obligation to pay the Indebtedness or other personal judgments against Borrower.
(b) Borrower shall indemnify Lender and hold Lender harmless from and against any and all Damages to Lender (including the legal and other expenses of enforcing the obligations of Borrower under this Section and Sponsor Guarantor under the Recourse Guaranty) resulting from or arising out of any of the followingfollowing (the “Indemnified Liabilities”), which Indemnified Liabilities shall be guaranteed by Guarantor pursuant to the Recourse Guaranty:
(i) any intentional physical Waste Any wrongful removal at the Property committed of any personal property, fixtures or permitted by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor;
(ii) any fraud or intentional misrepresentation in connection with other Collateral following the Loan committed by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor;
(iii) any willful misconduct by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor (including any bad faith interference by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor with the exercise any rights occurrence and remedies available to Lender as provided herein and in the other Loan Documents during the continuance of an Event of DefaultDefault (other than the replacement or other disposition of obsolete or non-useful personal property and fixtures in the ordinary course of business or as otherwise permitted pursuant to the terms hereof), or intentional physical Waste, in each case, committed or permitted by any Borrower Party or any Controlled Affiliate of any such Borrower Party;
(ii) any fraud, willful misconduct or material misrepresentation committed by any Borrower Party or any Controlled Affiliate thereof, including, without limitation, knowing material misstatements in securitization offering materials approved by Borrower (which approved sections shall only include factual matters related to the Borrower Parties and the Property);
(iii) intentionally blank;
(iv) the misappropriation or misapplication by Borrower, Sponsor any Borrower Party or any affiliate Controlled by Borrower and/or Sponsor Affiliate thereof of any funds in violation of the Loan Documents (including misappropriation or misapplication of Loss Proceeds, Revenues, Loan proceeds and/or security deposits and/or Loss Proceedsand including a failure by Borrower to deliver to Lender any bond or other instrument held by Borrower in lieu of a cash security deposit following foreclosure of the Mortgage, the appointment of a receiver or any other exercise of Lender’s remedies under the Loan Documents);
(v) any voluntary incurrence of Debt, other than Permitted Debt; excluding any Debt incurred by Borrower if and as a result of a failure to pay any Budgeted Operating Expenses to the extent that, after cash flow at the continued existence of Property has been disbursed from the Cash Management Account in accordance with Section 3.2, the cash flow made available to pay such Debt Budgeted Operating Expenses is prohibited hereunderinsufficient to pay such Budgeted Operating Expenses;
(vi) the filing by any Borrower Party or any Affiliate thereof (but not a bankruptcy trustee or receiver on behalf of any of the foregoing) of a motion for substantive consolidation of Borrower into another entity citing the breach of any covenant set forth in Section 6.15 as a primary factor in such motion;
(vii) the failure by a Borrower Party or any Controlled Affiliate thereof to apply available funds from cash flow at the Property (after such cash flow has been disbursed from the Cash Management Account in accordance with Section 3.2) to pay or maintain the Policies or to pay the amount of any deductible required thereunder following a Casualty or other insurance claim, provided that current excluding any such failure resulting from Lender’s failure to disburse funds from cash flow is at the Property that are sufficient and to pay such amounts;
(viii) the failure by a Borrower Party or any Controlled Affiliate thereof to apply available pursuant to the Approved Management Agreement for payment of same and provided Lender permits funds from cash flow at the Property (after such cash flow has been disbursed from the Cash Management Account in accordance with Section 3.2) to pay Property Taxes, excluding any such failure resulting from Lender’s failure to disburse funds from cash flow at the Property that are sufficient to pay such Property Taxes;
(ix) the failure by a Borrower Party or any Controlled Affiliate thereof to apply available funds from cash flow at the Property (after such cash flow has been disbursed from the Cash Management Account) in accordance with Section 3.2) to pay charges (including charges for labor and materials) that results in a Lien on the Property, unless contested by Borrower in good faith and otherwise in accordance with the terms of this Agreement and the other Loan Documents;
(x) the material breach of Section 6.15 excluding any breach resulting solely from a failure of the Property to be applied for such purposegenerate sufficient cash flow or a failure of Guarantor to contribute additional capital;
(viixi) any Borrower Party or any Affiliate of any Borrower Party raises defenses to Lender’s pursuit of any remedies under the failure Loan Documents, which defenses are found by a court of competent jurisdiction to be without merit and raised in bad faith;
(xii) any liabilities of Borrower related to beBorrower’s ownership of assets, and to at all times have beenif any, a Single-Purpose Entity, regardless of whether such failure to have been a Single-Purpose Entity prior to the date hereof has been disclosed to Lender, and including any and all liabilities, contingent or otherwise, arising from or related to (x) the actions, conduct and/or operating history of Borrower (or any Person merged into Borrower) prior to the Closing Date and (y) Borrower’s ownership (or the ownership of any Person merged into Borrower) of assets prior to the Closing Date that do not constitute a portion of collateral for the Collateral;
(viii) removal of personal property by Borrower from the Property outside of the ordinary course of business during the continuance of an Event of Default in violation of the Loan Agreement, unless replaced with personal property of the same utility and of the same or greater value and utilityLoan; and
(ixxiii) any fees or commissions paid by Borrower to any affiliate Affiliate in violation of the terms of the Loan Documents, it being understood that Approved Manager shall be entitled to be paid its then current management fees at all times while it is performing services under the Approved Management Agreement. In addition to the foregoing, the Loan shall be fully recourse to Borrower and SponsorGuarantor, jointly and severally, if if:
(i) there is any unauthorized (a) Transfer of a fee interest in the Property or a ground lease or Master Lease of the Property, or (b) Transfer of any other Collateral (including voluntary Liens and encumbrances on the Collateral other than Permitted Encumbrances) direct or Prohibited Change indirect equity interests in Borrower that causes a change of Control or Prohibited Pledgeof Borrower, in each case, in violation of the terms of this Agreement; provided, that a mechanics’ or materialmens’ liens shall not constitute a Transfer in violation of the Loan Documents, Documents for purposes hereof;
(ii) Borrower encumbers the Property or any other Collateral, in each case, to secure additional financing, or Borrower’s equityholders incur prohibited mezzanine financing, in each case, without the prior written consent of Lender;
(iii) any petition for bankruptcy, insolvency, dissolution or liquidation under the Bankruptcy Code or any similar federal or state law is voluntarily filed byby Borrower, consented to, or acquiesced in by, Borrower, any Borrower Related Party;
(iiiiv) any Borrower or any of its affiliates (including Sponsor) Related Party shall have colluded with other creditors to cause an involuntary bankruptcy filing under the Bankruptcy Code or similar federal or state law with respect to Borrower, or Borrower shall have terminated one or more of the Independent Directors for the purpose of facilitating a bankruptcy filing, or ; or
(ivv) Borrower fails to becomply with any representation, and warranty or covenant set forth in Section 6.15 hereof or failing to at all times have been, maintain its status as a Single-Single- Purpose Entity, which failure as required by, and in accordance with, the terms and provisions of this Agreement that results in a substantive consolidation of Borrower with any affiliate in a bankruptcy or similar proceeding. All of Borrower’s liabilities under this Section 9.19(b) shall be guaranteed by Sponsor pursuant to the Guarantyits Affiliates.
(c) The foregoing limitations on personal liability shall in no way impair or constitute a waiver of the validity of the NotesNote, the Indebtedness secured by the Collateral, or the Liens on the Collateral, or the right of Lender, as mortgagee or secured party, to foreclose and/or enforce its rights with respect to the Collateral after the occurrence and during the continuance of an Event of Default. Nothing in this Agreement shall be deemed to be a waiver of any right which Lender may have under the Bankruptcy Code to file a claim for the full amount of the debt owing to Lender by Borrower or to require that all Collateral shall continue to secure all of the Indebtedness owing to Lender in accordance with the Loan Documents. Lender may seek a judgment on the Note Notes (and, if necessary, name Borrower in such suit) as part of judicial proceedings to foreclose on any Collateral or as a prerequisite to any such foreclosure or to confirm any foreclosure or sale pursuant to power of sale thereunder, and in the event any suit is brought on the Note(s)Notes, or with respect to any Indebtedness or any judgment rendered in such judicial proceedings, such judgment shall constitute a Lien on and may be enforced on and against the Collateral and the rents, profits, issues, products and proceeds thereof. Nothing in this Agreement shall impair the right of Lender to accelerate the maturity of the Note during Notes upon the continuance occurrence of an Event of Default in accordance with the Loan DocumentsDefault, nor shall anything in this Agreement impair or be construed to impair the right of Lender to seek personal judgments, and to enforce all rights and remedies under applicable lawLegal Requirements, jointly and severally against any indemnitors and guarantors to the extent allowed by any applicable Loan Documents. The provisions set forth in this Section are not intended as a release or discharge of the obligations due under the Note Notes or under any Loan Documents, but are intended as a limitation, to the extent provided in this Section, on Lender’s right to ▇▇▇ for a deficiency or seek a personal judgment except as required in order to realize on the Collateral.
(d) For the avoidance of doubt, the failure to pay trade payables as a result of insufficient cash flow from the Property shall not trigger liability under this Section 9.19.
Appears in 1 contract
Sources: Loan Agreement (Brookfield DTLA Fund Office Trust Investor Inc.)
Recourse. (a) Subject to the qualifications herein, Lender shall not enforce Borrower’s 's obligation to pay the Indebtedness by any action or proceeding wherein a deficiency judgment or other judgment establishing personal liability shall be sought against Borrower or any of its affiliates, or any Exculpated Person, except for foreclosure actions or any other appropriate actions or proceedings against Borrower in order to fully exercise Lender’s 's remedies in respect of, and to realize upon, the Collateral, and except for any actions to enforce any obligations expressly assumed or guaranteed by any guarantor, indemnitor or similar party (whether or not such party is an . Exculpated Person) under the Loan Documents; provided however such foreclosure or appropriate actions or proceedings against Borrower shall, in no event, seek to enforce Borrower’s obligation to pay the Indebtedness or other personal judgments against Borrower.
(b) Borrower shall indemnify Lender and hold Lender harmless from and against any and all Damages to Lender (including the legal and other expenses of enforcing the obligations of Borrower under this Section and Sponsor under the Guaranty) resulting from or arising out of any of of.he following (the following:"Indemnified Liabilities"):
(i) any intentional or grossly negligent physical Waste at the Property committed or permitted by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsorof their respective affiliates;
(ii) any fraud or intentional misrepresentation in connection with the Loan committed by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsorof their respective affiliates;
(iii) any willful misconduct by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor of their respective affiliates (including any litigation or other legal proceeding initiated by such Person in bad faith interference by Borrowerthat delays, Sponsor opposes impedes, obstructs, hinders, enjoins or any affiliate Controlled by Borrower and/or Sponsor otherwise interferes with or frustrates the efforts of Lender to exercise any rights and remedies available to Lender as provided herein and in the other Loan Documents during the continuance of an Event of Default);
(iv) the misappropriation or misapplication by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor of their respective affiliates of any funds in violation of the Loan Documents (including misappropriation or misapplication of Revenues, security deposits and/or Loss Proceeds);
(v) any voluntary Debt incurred by Borrower if and to the extent the continued existence of such Debt is prohibited hereunder;
(vi) any breach by Borrower or Sponsor of any representation or covenant regarding environmental matters contained in this Agreement or in the Environmental Indemnity;
(vii) the failure to pay or maintain the Policies or pay the amount of any deductible required thereunder following a Casualty or other insurance claim, provided that current cash flow is sufficient and available pursuant to the Approved Management Agreement for payment of same and provided Lender permits cash flow from the Property to be applied for such purpose;
(viiviii) the failure any violation of Borrower to be, and to at all times have been, a Single-Purpose Entity, regardless or misrepresentation in connection with Section 4.17 of whether such this Agreement or any violation of or failure to have been a Single-Purpose Entity prior to the date hereof has been disclosed to Lender, and including any and all liabilities, contingent or otherwise, arising from or related to (x) the actions, conduct and/or operating history comply with Section 6.15 of Borrower (or any Person merged into Borrower) prior to the Closing Date and (y) Borrower’s ownership (or the ownership of any Person merged into Borrower) of assets prior to the Closing Date that do not constitute a portion of the Collateralthis Agreement;
(viiiix) removal of personal property by Borrower from the Property outside of the ordinary course of business during the continuance or in anticipation of an Event of Default in violation of the Loan AgreementDefault, unless replaced with personal property of the same utility and of the same or greater value and utility; and;
(ixx) any fees or commissions paid by Borrower to any affiliate in violation of the terms terms, of the Loan Documents;
(xi) any bankruptcy of any Required SPE, provided that, for this purpose "Damages" shall be limited to the amount by which such costs and expenses exceed the costs and expenses Lender would have incurred in an uncontested foreclosure on the Property (for the avoidance of doubt, the recourse described in this clause shall be in addition to the full recourse for bankruptcy described below);
(xii) for any loss or damage suffered by Lender as a result of or in any way related to the Assignment Transaction (as defined in the Security Instrument);
(xiii) the contesting or opposition by Borrower, Sponsor or any of their respective affiliates of any motion filed by Lender for relief from the automatic stay in any bankruptcy proceeding of Borrower;
(xiv) the Prior Owned Property; and
(xv) the failure of Borrower to pay the applicable Yield Maintenance Premium and all costs and expenses incurred by Lender with respect to a prepayment in accordance with Section 3.12(d). In addition to the foregoing, the Loan shall be fully recourse to Borrower and Sponsor, jointly and severally, if (i) there is any unauthorized Transfer of the Property or any other Collateral (including voluntary unauthorized Liens and encumbrances on the Collateral other than Permitted EncumbrancesCollateral) or Prohibited Change of Control or Prohibited Pledge, in each case, in violation of the Loan Documents, (ii) any petition for bankruptcy, insolvency, dissolution or liquidation under the Bankruptcy Code or any similar federal or state law is filed by, consented to, or acquiesced in by, Borrowerany Required SPE, (iii) Borrower any Required SPE or any of its their respective affiliates (including Sponsor) shall have colluded with other creditors to cause an involuntary filing under the Bankruptcy Code or similar federal or state law with respect to Borrowerany Required SPE, or Borrower any Required SPE shall have terminated one or more of the any Independent Directors Director for the purpose of facilitating a bankruptcy filing, or (iv) Borrower any Required SPE fails to be, and to at all times have been, a Single-Purpose Entity, which failure results in a substantive consolidation of Borrower with any affiliate in a bankruptcy or similar proceeding. All of Borrower’s liabilities under this Section 9.19(b) shall be guaranteed by Sponsor pursuant to the Guaranty.
(c) The foregoing limitations on personal liability shall in no way impair or constitute a waiver of the validity of the Notes, the Indebtedness secured by the Collateral, or the Liens on the Collateral, or the right of Lender, as mortgagee or secured party, to foreclose and/or enforce its rights with respect to the Collateral after an Event of Default. Nothing in this Agreement shall be deemed to be a waiver of any right which Lender may have under the Bankruptcy Code to file a claim for the full amount of the debt owing to Lender by Borrower or to require that all Collateral shall continue to secure all of the Indebtedness owing to Lender in accordance with the Loan Documents. Lender may seek a judgment on the Note (and, if necessary, name Borrower in such suit) as part of judicial proceedings to foreclose on any Collateral or as a prerequisite to any such foreclosure or to confirm any foreclosure or sale pursuant to power of sale thereunder, and in the event any suit is brought on the Note(s)Notes, or with respect to any Indebtedness or any judgment rendered in such judicial proceedings, such judgment shall constitute a Lien on and may be enforced on and against the Collateral and the rents, profits, issues, products and proceeds thereof. Nothing in this Agreement shall impair the right of Lender to accelerate the maturity of the Note during upon the continuance occurrence of an Event of Default in accordance with the Loan DocumentsDefault, nor shall anything in this Agreement impair or be construed to impair the right of Lender to seek personal judgments, and to enforce all rights and remedies under applicable law, jointly and severally against any indemnitors and guarantors to the extent allowed by any applicable Loan Documents. The provisions set forth in this Section are not intended as a release or discharge of the obligations due under the Note or under any Loan Documents, but are intended as a limitation, to the extent provided in this Section, on Lender’s 's right to ▇s▇▇ for a deficiency or seek a personal judgment except as required in order to realize on the Collateral.
(d) For the avoidance purposes of doubt, the failure to pay trade payables as a result of insufficient cash flow from the Property shall not trigger liability under this Section 9.19, "affiliate" or "affiliated" means as to any Person, any other Person that, directly or indirectly, is in Control of, is Controlled by or is under common Control with such Person.
Appears in 1 contract
Sources: Loan Agreement (American Realty Capital - Retail Centers of America, Inc.)
Recourse. (a) Subject to the qualifications herein, Lender No recourse shall not enforce Borrower’s obligation to pay be had for the Indebtedness by against any action or proceeding wherein a deficiency judgment or other judgment establishing personal liability shall be sought against affiliate of Borrower or any officer, director, partner or equityholder of its affiliates, Borrower or any Exculpated Personsuch affiliate unless, except in the case of an affiliate, expressly set forth in a Qualified Guarantee or other written agreement to which such affiliate is party. Except for foreclosure actions or any other appropriate actions or proceedings against the liabilities of Borrower in order to fully exercise Lender’s remedies in respect ofunder Sections 9.19(b), 5.18 and to realize upon, the Collateral, 9.14 and except for any actions to enforce any obligations expressly assumed or guaranteed by any guarantor, indemnitor or similar party (whether or not such party is an Exculpated Person) under the Loan Documents; provided however such foreclosure or appropriate actions or proceedings against Environmental Indemnity and Cooperation Agreement, recourse to the Borrower shall, in no event, seek shall be limited to enforce Borrower’s obligation to pay the Indebtedness or Liens of Lender on the Property and the other personal judgments against BorrowerCollateral.
(b) Borrower shall indemnify Lender and hold Lender harmless from and against any and all Damages to Lender (including the legal and other expenses of enforcing the obligations of the Borrower under this Section and Sponsor under the Guaranty9.19) resulting from or arising out of any of the following:following (the “Indemnified Liabilities”):
(i) any intentional physical Waste at waste with respect to the Property committed or permitted by Borrower, the Sponsor or any affiliate Controlled by Borrower and/or Sponsorof their respective Affiliates;
(ii) any fraud or intentional misrepresentation in connection with the Loan committed by Borrower, the Sponsor or any affiliate Controlled by Borrower and/or Sponsorof their respective Affiliates;
(iii) any willful misconduct by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor (including any bad faith interference by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor with the exercise any rights and remedies available to Lender as provided herein and in the other Loan Documents during the continuance of an Event of Default);
(iv) the misappropriation or misapplication by Borrower, the Sponsor or any affiliate Controlled by Borrower and/or Sponsor of their respective Affiliates of any funds in violation of the Loan Documents (including misappropriation or misapplication of Revenues, security deposits and/or Loss ProceedsProceeds and the violation of the last sentence of Section 5.8(d));
(iv) any Transfer of Collateral, voluntary or collusive Lien on Collateral, or Change of Control which is prohibited hereunder;
(v) any voluntary Debt incurred breach by Borrower if and to or the extent Sponsor of any representation or covenant regarding environmental matters contained in this Agreement or in the continued existence of such Debt is prohibited hereunderEnvironmental Indemnity;
(vi) the failure to pay or maintain the Policies or pay the amount of Borrower, at any deductible required thereunder following a Casualty or other insurance claimtime, provided that current cash flow is sufficient and available pursuant to the Approved Management Agreement for payment of same and provided Lender permits cash flow from the Property to be applied for such purpose;
(vii) the failure of Borrower to be, and to at all times have been, a Single-Purpose Entity, regardless of whether if such failure to have been a Single-Purpose Entity prior results in material liability unrelated to the date hereof has been disclosed to Lender, and including any and all liabilities, contingent Property or otherwise, arising from consolidation of the Borrower with another entity in connection with a filing of a bankruptcy or related to (x) the actions, conduct and/or operating history similar proceeding in respect of Borrower (or any Person merged into Borrower) prior to the Closing Date and (y) Borrower’s ownership (or the ownership of any Person merged into Borrower) of assets prior to the Closing Date that do not constitute a portion of the Collateral;
(viii) removal of personal property by Borrower from the Property outside of the ordinary course of business during the continuance of an Event of Default in violation of the Loan Agreement, unless replaced with personal property of the same utility and of the same or greater value and utilitysuch entity; and
(ixvii) the occurrence of any fees or commissions paid filing by Borrower to any affiliate in violation of the terms of the Loan Documents. In addition to the foregoing, the Loan shall be fully recourse to Borrower and Sponsor, jointly and severally, if (i) there is any unauthorized Transfer of the Property or any other Collateral (including voluntary Liens and encumbrances on the Collateral other than Permitted Encumbrances) or Prohibited Change of Control or Prohibited Pledge, in each case, in violation of the Loan Documents, (ii) any petition for bankruptcy, insolvency, dissolution or liquidation under the Bankruptcy Code or any similar federal joining or state law is filed by, consented to, or acquiesced in by, Borrower, (iii) colluding by Borrower or any of its affiliates (including Sponsor) shall have colluded with other creditors to cause in the filing of an involuntary filing case in respect of Borrower under the Bankruptcy Code or similar federal or state law with respect to Borrower, or Borrower shall have terminated one or more of the Independent Directors for the purpose of facilitating a bankruptcy filing, or (iv) Borrower fails to be, and to at all times have been, a Single-Purpose Entity, which failure results in a substantive consolidation of Borrower with any affiliate in a bankruptcy or similar proceeding. All of Borrower’s liabilities under this Section 9.19(b) shall be guaranteed by Sponsor pursuant to the GuarantyCode.
(c) The foregoing limitations on personal liability shall in no way impair or constitute a waiver of the validity of the Notes, the Indebtedness secured by the Collateral, or the Liens on the Collateral, or the right of Lender, as mortgagee or secured party, to foreclose and/or enforce its rights with respect to the Collateral after an Event of Default. Nothing in this Agreement shall be deemed to be a waiver of any right which Lender may have under the Bankruptcy Code to file a claim for the full amount of the debt owing to Lender by Borrower or to require that all Collateral shall continue to secure all of the Indebtedness owing to Lender in accordance with the Loan Documents. Lender may seek a judgment on the Note (and, if necessary, name Borrower in such suit) as part of judicial proceedings to foreclose on any Collateral or as a prerequisite to any such foreclosure or to confirm any foreclosure or sale pursuant to power of sale thereunder, and in the event any suit is brought on the Note(s), or with respect to any Indebtedness or any judgment rendered in such judicial proceedings, such judgment shall constitute a Lien on and may be enforced on and against the Collateral and the rents, profits, issues, products and proceeds thereof. Nothing in this Agreement shall impair the right of Lender to accelerate the maturity of the Note during the continuance of an Event of Default in accordance with the Loan Documents, nor shall anything in this Agreement impair or be construed to impair the right of Lender to seek personal judgments, and to enforce all rights and remedies under applicable law, jointly and severally against any indemnitors and guarantors to the extent allowed by any applicable Loan Documents. The provisions set forth in this Section are not intended as a release or discharge of the obligations due under the Note or under any Loan Documents, but are intended as a limitation, to the extent provided in this Section, on Lender’s right to ▇▇▇ for a deficiency or seek a personal judgment except as required in order to realize on the Collateral.
(d) For the avoidance of doubt, the failure to pay trade payables as a result of insufficient cash flow from the Property shall not trigger liability under this Section 9.19.
Appears in 1 contract
Sources: Loan Agreement (KBS Real Estate Investment Trust II, Inc.)
Recourse. (a) Subject Except for any obligations of any Person under a Loan Document to the qualifications hereinwhich it is a party, Lender no recourse shall not enforce Borrower’s obligation to pay be had for the Indebtedness by or for the performance or observation of any action other obligation under this Agreement or proceeding wherein a deficiency judgment or other judgment establishing personal liability shall be sought any of the Loan Documents against any Affiliate of Borrower or any officer, director, partner or equityholder of its affiliates, Borrower or any Exculpated Person, except for foreclosure actions or any other appropriate actions or proceedings against Borrower in order to fully exercise such Affiliate. There shall be no limit on Lender’s remedies in respect of, and to realize upon, the Collateral, and except for any actions to enforce any obligations expressly assumed or guaranteed by any guarantor, indemnitor or similar party (whether or not such party is an Exculpated Person) under the Loan Documents; provided however such foreclosure or appropriate actions or proceedings against Borrower shall, in no event, seek to enforce Borrower’s obligation to pay the Indebtedness or other personal judgments recourse against Borrower.
(b) Borrower shall indemnify Lender and hold Lender harmless from and against any and all Damages to Lender (including the legal and other expenses of enforcing the obligations of Borrower under this Section and Sponsor under the Guaranty9.19) resulting from or arising out of any of the following:following (the “Indemnified Liabilities”):
(i) any intentional physical Waste at the Property committed or permitted by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor;
(ii) any fraud or intentional misrepresentation committed by Borrower, Property Owner, Property Owner GP, TRS Lessee, Operating Partnership, Sponsor or any of their respective Affiliates in connection with the Loan committed by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsorthe Mortgage Loan;
(iii) any willful misconduct by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor (including any bad faith interference by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor with the exercise any rights and remedies available to Lender as provided herein and in the other Loan Documents during the continuance of an Event of Default);
(ivii) the misappropriation or misapplication by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor of any funds (in violation of the Loan Documents and/or the Mortgage Loan Documents) by Borrower, Property Owner, Property Owner GP, TRS Lessee, Operating Partnership, Sponsor or any of their respective Affiliates of any funds (including misappropriation or misapplication of Revenues, security deposits deposits, sales proceeds, Loss Proceeds and/or Loss Proceedsany excess proceeds from Mortgage Lender’s exercise of any of its remedies under the Mortgage Loan Documents remaining after payment in full of the Mortgage Loan Indebtedness and the violation of the last sentence of Section 5.7(d) of this Agreement and/or the Mortgage Loan Agreement and any failure by the Operating Partnership to remit or cause to be remitted all net revenues generated by the Encumbered Properties in the possession or control of the Operating Partnership or its Affiliates, including but not limited to net revenues from the sale of all or any part of the Encumbered Properties, or sales of full or partial interests in the Encumbered Properties, into the Mortgage Loan Cash Management Account or a Mortgage Loan Blocked Account, in each case pursuant to and solely to the extent required under Section 3.1(b)(ii) of the Mortgage Loan Agreement);
(iii) any Transfer of any of the Mortgaged Properties, the Collateral, the Mortgage Loan Collateral or any other direct or, except as described in Section 7.1(f), indirect interests in Borrower, Property Owner, Property Owner GP or TRS Lessee or any Lien which is prohibited hereunder and/or under the Mortgage Loan Documents;
(iv) any breach by Borrower, Property Owner, Property Owner GP, TRS Lessee, Operating Partnership or Sponsor of any representation or covenant regarding environmental matters contained in this Agreement or in the Environmental Indemnity Agreement;
(v) the occurrence of any voluntary Debt incurred filing by Borrower, Property Owner, Property Owner GP, TRS Lessee or any Junior Mezzanine Borrower if under the Bankruptcy Code or any joining or colluding by Borrower, Property Owner, Property Owner GP, TRS Lessee, any Junior Mezzanine Borrower or any of their Affiliates (including Sponsor and to Operating Partnership) in the extent filing of an involuntary case in respect of Borrower, Property Owner, Property Owner GP, TRS Lessee or any Junior Mezzanine Borrower under the continued existence of such Debt is prohibited hereunderBankruptcy Code;
(vi) the failure any intentional physical waste with respect to pay any Mortgaged Property committed or maintain the Policies permitted by Borrower, Property Owner, Property Owner GP, TRS Lessee, Operating Partnership, Sponsor or pay the amount any of any deductible required thereunder following a Casualty or other insurance claim, provided that current cash flow is sufficient and available pursuant to the Approved Management Agreement for payment of same and provided Lender permits cash flow from the Property to be applied for such purposetheir respective affiliates;
(vii) the failure of Borrower any of Borrower, Property Owner and/or, if applicable, any Single-Purpose Equityholder, at any time, to be, and to at all times have been, be a Single-Purpose Entity, regardless of whether such failure to have been a Single-Purpose Entity prior to the date hereof has been disclosed to Lender, and including any and all liabilities, contingent or otherwise, arising from or related to (x) the actions, conduct and/or operating history of Borrower (or any Person merged into Borrower) prior to the Closing Date and (y) Borrower’s ownership (or the ownership failure of any Person merged into Borrower) of assets prior TRS Lessee, at any time, to the Closing Date that do not constitute be a portion of the CollateralQualified TRS Lessee;
(viii) removal failure of personal property Borrower to deliver any certificates which evidence the equity interests pledged by Borrower from pursuant to the Property outside of the ordinary course of business during the continuance of Pledge Agreement to Lender, together with an Event of Default executed stock, membership or partnership power, as applicable, in violation of the Loan Agreement, unless replaced with personal property of the same utility and of the same or greater value and utilityblank; and
(ix) any fees Borrower’s failure to notify Lender or commissions paid by Borrower cause Lender to any affiliate in violation be notified of the terms receipt by the Encumbered Property Owner of a written notice of default (specifically denominated as such) under any Encumbered Property Indebtedness Document and/or Borrower’s failure to reasonably cooperate with Lender to permit Lender to cure the Loan Documents. In addition to the foregoing, the Loan shall be fully recourse to Borrower and Sponsor, jointly and severally, if (i) there is any unauthorized Transfer of the Property or any other Collateral (including voluntary Liens and encumbrances on the Collateral other than Permitted Encumbrances) or Prohibited Change of Control or Prohibited Pledgedefault, in each casecase if, and only if, a Whitehall Knowledge Party is aware of same, in violation of the Loan Documents, (ii) any petition for bankruptcy, insolvency, dissolution or liquidation under the Bankruptcy Code or any similar federal or state law is filed by, consented to, or acquiesced in by, Borrower, (iii) Borrower or any of its affiliates (including Sponsor) shall have colluded with other creditors to cause an involuntary filing under the Bankruptcy Code or similar federal or state law with respect to Borrower, or Borrower shall have terminated one or more of the Independent Directors for the purpose of facilitating a bankruptcy filing, or (iv) Borrower fails to be, and to at all times have been, a Single-Purpose Entity, which failure results in a substantive consolidation of Borrower with any affiliate in a bankruptcy or similar proceeding. All of Borrower’s liabilities under this Section 9.19(b) shall be guaranteed by Sponsor each case pursuant to the GuarantySection 5.21.
(c) The foregoing limitations on personal liability shall in no way impair or constitute a waiver of the validity of the Notes, the Indebtedness secured by the Collateral, or the Liens on the Collateral, or the right of Lender, as mortgagee pledgee or secured party, to foreclose and/or enforce its rights with respect to the Collateral after an Event of Default. Nothing in this Agreement shall be deemed to be a waiver of any right which Lender may have under the United States Bankruptcy Code to file a claim for the full amount of the debt owing to Lender by Borrower or to require that all Collateral shall continue to secure all of the Indebtedness owing to Lender in accordance with the Loan Documents. Lender may seek a judgment on the Note (and, if necessary, name Borrower in such suit) as part of judicial proceedings to foreclose on under the Pledge Agreement or to foreclose pursuant to any Collateral other Loan Documents, or as a prerequisite to any such foreclosure or to confirm any foreclosure or sale pursuant to power of sale thereunder, and in the event any suit is brought on the Note(s)Notes, or with respect to any Indebtedness or any judgment rendered in such judicial proceedings, such judgment shall constitute a Lien on and may will be and can be enforced on and against the Collateral and the rents, profits, issues, products and proceeds thereof. Nothing in this Agreement shall impair the right of Lender to accelerate the maturity of the Note during upon the continuance occurrence of an Event of Default in accordance with the Loan DocumentsDefault, nor shall anything in this Agreement impair or be construed to impair the right of Lender to seek personal judgments, and to enforce all rights and remedies under applicable law, jointly and severally law against any indemnitors guarantors (including, without limitation, Sponsor and guarantors Operating Partnership) to the extent allowed by any applicable Loan Documentsguarantees (including, without limitation, the Recourse Guaranty). The provisions set forth in this Section 9.19 are not intended as a release or discharge of the obligations due under the Note or under any Loan Collateral Documents, but are intended as a limitation, to the extent provided in this Section, on Lender’s right to ▇▇▇ for a deficiency or seek a personal judgment except as required in order to realize on the Collateralagainst Borrower or Sponsors.
(d) For the avoidance of doubt, the failure to pay trade payables as a result of insufficient cash flow from the Property shall not trigger liability under this Section 9.19.
Appears in 1 contract
Sources: Mezzanine Loan Agreement (W2007 Grace Acquisition I Inc)
Recourse. (a) Subject Agent and Lenders shall have full recourse against Borrower for any liability or obligation of Borrower under this Agreement and the other Project Loan Documents. Neither Lenders nor Agent nor any of them shall have any recourse against, or the right to enforce the qualifications hereinliability and obligation of, Lender shall not enforce Borrower’s obligation the other Borrower Entities to pay perform and observe the Indebtedness obligations contained in this Agreement or any other Project Loan Documents by any action or proceeding wherein a deficiency judgment or brought against any such other judgment establishing personal liability shall be sought against Borrower or any of its affiliatesEntity other than (1) as expressly provided in the Guaranties, or any Exculpated Person, except for foreclosure actions or any other appropriate actions or proceedings against agreement hereafter executed and delivered to Agent by such other Borrower in order to fully exercise Lender’s remedies in respect of, and to realize upon, the Collateral, and except for any actions to enforce any obligations expressly assumed or guaranteed by any guarantor, indemnitor or similar party (whether or not such party is an Exculpated Person) under the Loan Documents; provided however such foreclosure or appropriate actions or proceedings against Borrower shall, in no event, seek to enforce Borrower’s obligation to pay the Indebtedness or other personal judgments against Borrower.
(b) Borrower shall indemnify Lender and hold Lender harmless from and against any and all Damages to Lender (including the legal and other expenses of enforcing the obligations of Borrower under this Section and Sponsor under the Guaranty) resulting from or arising out of any of the following:
(i) any intentional physical Waste at the Property committed or permitted by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor;
(ii) any fraud or intentional misrepresentation Entity in connection with the Project Loan committed by Borrower, Sponsor or (2) against the collateral granted under the Security Documents or any affiliate Controlled other Project Loan Document. The provisions of this Section 11.16 shall not (i) constitute a waiver, release or impairment of any obligation evidenced or secured by Borrower and/or Sponsor;
any of the Project Loan Documents or the NYTC Completion Guaranty; (ii) affect the validity or enforceability of any Project Loan Document or the NYTC Completion Guaranty or any of the rights and remedies of Agent thereunder; or (iii) any willful misconduct by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor (including any bad faith interference by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor with the exercise any rights and remedies available to Lender as provided herein and in the other Loan Documents during the continuance of an Event of Default);
(iv) the misappropriation or misapplication by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor of any funds in violation of the Loan Documents (including misappropriation or misapplication of Revenues, security deposits and/or Loss Proceeds);
(v) any voluntary Debt incurred by Borrower if and to the extent the continued existence of such Debt is prohibited hereunder;
(vi) the failure to pay or maintain the Policies or pay the amount of any deductible required thereunder following a Casualty or other insurance claim, provided that current cash flow is sufficient and available pursuant to the Approved Management Agreement for payment of same and provided Lender permits cash flow from the Property to be applied for such purpose;
(vii) the failure of Borrower to be, and to at all times have been, a Single-Purpose Entity, regardless of whether such failure to have been a Single-Purpose Entity prior to the date hereof has been disclosed to Lender, and including any and all liabilities, contingent or otherwise, arising from or related to (x) the actions, conduct and/or operating history of Borrower (or any Person merged into Borrower) prior to the Closing Date and (y) Borrower’s ownership (or the ownership of any Person merged into Borrower) of assets prior to the Closing Date that do not constitute a portion of the Collateral;
(viii) removal of personal property by Borrower from the Property outside of the ordinary course of business during the continuance of an Event of Default in violation of the Loan Agreement, unless replaced with personal property of the same utility and of the same or greater value and utility; and
(ix) any fees or commissions paid by Borrower to any affiliate in violation of the terms of the Loan Documents. In addition to the foregoing, the Loan shall be fully recourse to Borrower and Sponsor, jointly and severally, if (i) there is any unauthorized Transfer of the Property or any other Collateral (including voluntary Liens and encumbrances on the Collateral other than Permitted Encumbrances) or Prohibited Change of Control or Prohibited Pledge, in each case, in violation of the Loan Documents, (ii) any petition for bankruptcy, insolvency, dissolution or liquidation under the Bankruptcy Code or any similar federal or state law is filed by, consented to, or acquiesced in by, Borrower, (iii) Borrower or any of its affiliates (including Sponsor) shall have colluded with other creditors to cause an involuntary filing under the Bankruptcy Code or similar federal or state law with respect to Borrower, or Borrower shall have terminated one or more of the Independent Directors for the purpose of facilitating a bankruptcy filing, or (iv) Borrower fails to be, and to at all times have been, a Single-Purpose Entity, which failure results in a substantive consolidation of Borrower with any affiliate in a bankruptcy or similar proceeding. All of Borrower’s liabilities under this Section 9.19(b) shall be guaranteed by Sponsor pursuant to the Guaranty.
(c) The foregoing limitations on personal liability shall in no way impair or constitute a waiver of the validity of the Notes, the Indebtedness secured by the Collateral, or the Liens on the Collateral, or the right of Lender, as mortgagee or secured party, to foreclose and/or enforce its rights with respect to the Collateral after an Event of Default. Nothing in this Agreement shall be deemed to be a waiver of any right which Lender may have under the Bankruptcy Code to file a claim for the full amount of the debt owing to Lender by Borrower or to require that all Collateral shall continue to secure all of the Indebtedness owing to Lender in accordance with the Loan Documents. Lender may seek a judgment on the Note (and, if necessary, name Borrower in such suit) as part of judicial proceedings to foreclose on any Collateral or as a prerequisite to any such foreclosure or to confirm any foreclosure or sale pursuant to power of sale thereunder, and in the event any suit is brought on the Note(s), or with respect to any Indebtedness or any judgment rendered in such judicial proceedings, such judgment shall constitute a Lien on and may be enforced on and against the Collateral and the rents, profits, issues, products and proceeds thereof. Nothing in this Agreement shall impair the right of Lender Agent to accelerate obtain the maturity appointment of the Note during the continuance of an Event of Default in accordance with the Loan Documentsa receiver. No officer, nor shall anything in director, member, shareholder, limited partner, employee, agent, representative, beneficiary or trustee of, or any person executing this Agreement impair or any other Project Loan Document or the NYTC Completion Guaranty in a representative capacity on behalf of (solely by virtue of such execution) a Borrower Entity shall ever be construed personally liable hereunder for the obligations of such Borrower Entity, all liability of each Borrower Party being expressly limited to impair such Borrower Entity (or any general partner, joint venturer, or other person having liability for the right obligations of Lender to seek personal judgmentssuch Borrower Entity as a matter of law) and its assets, and all persons dealing with a Borrower Entity must look solely to enforce all rights such Borrower Entity (or any general partner, joint venturer, or other person having liability for the obligations of such Borrower Entity as a matter of law) and remedies under applicable law, jointly its assets for the enforcement of any claim against such Borrower Entity and severally against in no event shall any indemnitors and guarantors recourse be had to the extent allowed private property of any officer, director, member, shareholder, limited partner, employee, agent, representative, beneficiary or trustee of, or any person executing this agreement on behalf of (solely by any applicable Loan Documents. The provisions set forth in this Section are not intended as virtue of such execution), a release or discharge of the obligations due under the Note or under any Loan Documents, but are intended as a limitation, to the extent provided in this Section, on Lender’s right to ▇▇▇ for a deficiency or seek a personal judgment except as required in order to realize on the CollateralBorrower Entity.
(d) For the avoidance of doubt, the failure to pay trade payables as a result of insufficient cash flow from the Property shall not trigger liability under this Section 9.19.
Appears in 1 contract
Recourse. By signing this Letter of Transmittal, the undersigned hereby accepts and agrees that the undersigned (a) Subject is a Stockholder as such term used in the Merger Agreement and (b) is bound by (and entitled to the qualifications hereinbenefits of) all of the terms, Lender conditions, duties, and obligations of a Stockholder under the Merger Agreement as if the undersigned were a direct party to the Merger Agreement (including, without limitation, Section 2.08 (Effect of Merger on Capital Stock); Section 2.11 (Surrender and Payment); Section 2.15 (Withholding Rights); Section 2.17 (Closing Merger Consideration and Closing Share Payment Adjustment); Section 2.19 (Earn-Out; Forfeiture); Section 2.20 (Parent Shares); Section 5.04 (No Solicitation of Other Bids); Article VIII (Conditions to Closing); Article IX (Indemnification), Article X (Termination) and Article XI (Miscellaneous). In addition to any indemnification obligations under the Merger Agreement, but subject to the terms and conditions thereof (including, without limitation, the limitations contained in Article IX thereof), the undersigned further acknowledges and agrees that the undersigned shall not enforce Borrower’s indemnify and hold harmless the Parent Indemnitees from Losses arising from or relating to (a) any inaccuracy in or breach of any of the representations or warranties of the undersigned contained in this Letter of Transmittal or any document to be delivered by the undersigned under the Merger Agreement and (b) any breach or non-fulfillment of any covenant, agreement or obligation to pay be performed by the Indebtedness by undersigned pursuant to this Letter of Transmittal, the Merger Agreement or any document to be delivered thereunder. By signing this Letter of Transmittal, for and in consideration of the amounts payable to the undersigned Stockholder under the Merger Agreement, the undersigned, on behalf of itself and its immediate family members, heirs, Affiliates, beneficiaries, successors and assigns (collectively, the “Releasors”), as of the Effective Time of the Merger (and subject to the undersigned’s receipt of the Pro Rata Share of the Closing Share Payment payable at Closing), hereby releases, acquits and forever discharges Merger Sub, Parent, the Company, their respective Affiliates and each of their present and former managers, directors, officers and employees and each of their respective heirs, executors, administrators, successors and assigns (“Releasees”), of and from any and all manner of action or proceeding wherein a deficiency judgment actions, cause or other judgment establishing personal liability causes of action, demands, rights, Losses, debts, dues, sums of money, accounts, reckonings, costs, expenses, responsibilities, covenants, contracts, controversies, agreements and claims whatsoever, whether known or unknown, of every name and nature, both in Law and in equity, which such Releasors ever had, now has, or which they may have or shall be sought have against Borrower the Company or any other Releasees referred to above arising out of any matters, causes, acts, conduct, claims, circumstances or events occurring or failing to occur or conditions existing at or prior to the Closing relating to the Company, the other Company Entities, or the Company Stock (“Stockholder Claims”); provided, however, that notwithstanding the foregoing or anything else contained herein to the contrary, the undersigned is not releasing, acquitting or discharging any Stockholder Claims arising under this Letter of Transmittal, the Merger Agreement or any other Ancillary Documents. The undersigned Stockholder acknowledges and agrees that: (i) subject to the undersigned’s receipt of the Pro Rata Share of the Total Merger Consideration, the undersigned has been paid all sums to which the undersigned was entitled in respect of his/her/its affiliatesaffiliation with the Company (whether in the form of salary, deferred compensation, commissions, bonuses, severance pay, or any Exculpated Personother form of compensation, other than any amount that is included in the Closing Working Capital of the Company) as of the Closing, and (ii) except for foreclosure actions as set forth in this this Letter of Transmittal, the Merger Agreement, or any other appropriate actions or proceedings against Borrower in order to fully exercise Lender’s remedies in respect of, and to realize upon, the CollateralAncillary Documents, and except for any actions accrued and unpaid salaries, wages and benefits owing to enforce any obligations expressly assumed or guaranteed by any guarantorthe undersigned, indemnitor or similar party (whether or not such party is if an Exculpated Person) under the Loan Documents; provided however such foreclosure or appropriate actions or proceedings against Borrower shall, in no event, seek to enforce Borrower’s obligation to pay the Indebtedness or other personal judgments against Borrower.
(b) Borrower shall indemnify Lender and hold Lender harmless from and against any and all Damages to Lender (including the legal and other expenses of enforcing the obligations of Borrower under this Section and Sponsor under the Guaranty) resulting from or arising out of any employee of the following:
(i) any intentional physical Waste at the Property committed or permitted by Borrower, Sponsor Company or any affiliate Controlled by Borrower and/or Sponsor;
(ii) any fraud or intentional misrepresentation in connection with the Loan committed by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor;
(iii) any willful misconduct by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor (including any bad faith interference by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor with the exercise any rights and remedies available to Lender as provided herein and in the other Loan Documents during the continuance of an Event of Default);
(iv) the misappropriation or misapplication by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor of any funds in violation subsidiary of the Loan Documents (including misappropriation Company, no further sums or misapplication of Revenues, security deposits and/or Loss Proceeds);
(v) any voluntary Debt incurred by Borrower if and benefits are due to the extent the continued existence of such Debt is prohibited hereunder;
(vi) the failure to pay or maintain the Policies or pay the amount of any deductible required thereunder following a Casualty or other insurance claim, provided that current cash flow is sufficient and available pursuant to the Approved Management Agreement for payment of same and provided Lender permits cash flow undersigned from the Property to be applied for such purpose;
(vii) the failure of Borrower to be, and to at all times have been, a Single-Purpose Entity, regardless of whether such failure to have been a Single-Purpose Entity prior to the date hereof has been disclosed to Lender, and including any and all liabilities, contingent or otherwiseCompany, arising from his/her/its affiliation with the Company or related to (x) the actions, conduct and/or operating history of Borrower (or any Person merged into Borrower) prior otherwise. Subject to the Closing Date reservation of rights and (y) Borrower’s ownership (or the ownership of any Person merged into Borrower) of assets prior to the Closing Date that do not constitute a portion limitation of the Collateral;
(viii) removal of personal property by Borrower from the Property outside scope of the ordinary course of business during the continuance of an Event of Default in violation of the Loan Agreement, unless replaced with personal property of the same utility and of the same or greater value and utility; and
(ix) any fees or commissions paid by Borrower to any affiliate in violation of the terms of the Loan Documents. In addition to the foregoingclaims released herein, the Loan shall be fully recourse to Borrower and Sponsor, jointly and severally, if (i) there is any unauthorized Transfer of the Property or any other Collateral (including voluntary Liens and encumbrances on the Collateral other than Permitted Encumbrances) or Prohibited Change of Control or Prohibited Pledge, in each case, in violation of the Loan Documents, (ii) any petition for bankruptcy, insolvency, dissolution or liquidation under the Bankruptcy Code or any similar federal or state law is filed by, consented to, or acquiesced in by, Borrower, (iii) Borrower or any of its affiliates (including Sponsor) shall have colluded with other creditors to cause an involuntary filing under the Bankruptcy Code or similar federal or state law with respect to Borrower, or Borrower shall have terminated one or more of the Independent Directors for the purpose of facilitating a bankruptcy filing, or (iv) Borrower fails to be, and to at all times have been, a Single-Purpose Entity, which failure results in a substantive consolidation of Borrower with any affiliate in a bankruptcy or similar proceeding. All of Borrower’s liabilities under this Section 9.19(b) shall be guaranteed by Sponsor pursuant to the Guaranty.
(c) The foregoing limitations on personal liability shall in no way impair or constitute a waiver of the validity of the Notes, the Indebtedness secured by the Collateral, or the Liens on the Collateral, or the right of Lender, as mortgagee or secured party, to foreclose and/or enforce its rights undersigned expressly acknowledges that with respect to the Collateral after an Event release of Default. Nothing known or unknown Stockholder Claims being released herein, the undersigned is aware that it may hereafter discover facts in this Agreement shall be deemed addition to or different from those which the undersigned now knows or believes to be a waiver true with respect to the subject matter herein, and the releases herein are binding and effective notwithstanding the discovery or existence of any right which Lender may have under such additional or different facts. By signing this Letter of Transmittal, the Bankruptcy Code to file a claim undersigned for itself, himself or herself and for its, his or her successors and assigns, hereby irrevocably acknowledges and accepts the full amount appointment of the debt owing to Lender by Borrower or to require that all Collateral shall continue to secure Stockholder Representative and all of the Indebtedness owing to Lender in accordance with the Loan Documents. Lender may seek a judgment on the Note (and, if necessary, name Borrower in such suit) provisions relating thereto as part of judicial proceedings to foreclose on any Collateral or as a prerequisite to any such foreclosure or to confirm any foreclosure or sale pursuant to power of sale thereunder, and in the event any suit is brought on the Note(s), or with respect to any Indebtedness or any judgment rendered in such judicial proceedings, such judgment shall constitute a Lien on and may be enforced on and against the Collateral and the rents, profits, issues, products and proceeds thereof. Nothing in this Agreement shall impair the right of Lender to accelerate the maturity of the Note during the continuance of an Event of Default in accordance with the Loan Documents, nor shall anything in this Agreement impair or be construed to impair the right of Lender to seek personal judgments, and to enforce all rights and remedies under applicable law, jointly and severally against any indemnitors and guarantors to the extent allowed by any applicable Loan Documents. The provisions set forth in this Section are not intended 11.01 of the Merger Agreement, and agrees to be bound by and to comply with the terms and conditions applicable to the undersigned in the undersigned’s capacity as a release or discharge Stockholder in Section 11.01 of the obligations due under Merger Agreement, including without limitation the Note or under any Loan Documents, but are intended as a limitation, to indemnification provisions in favor of the extent provided in this Section, on Lender’s right to ▇▇▇ for a deficiency or seek a personal judgment except as required in order to realize on the CollateralStockholder Representative.
(d) For the avoidance of doubt, the failure to pay trade payables as a result of insufficient cash flow from the Property shall not trigger liability under this Section 9.19.
Appears in 1 contract
Recourse. (a) Subject The Loan and all obligations of Borrower hereunder are fully recourse to Borrower. Except as set forth in Section 9.19(b), in the qualifications hereinRecourse Guaranty, Lender in the Environmental Indemnities and in Section 5.19 and in Section 9.14, no recourse shall not enforce Borrower’s obligation to pay be had for the Indebtedness by or for the performance or observation of any action other obligation under this Agreement or proceeding wherein any of the Loan Documents against any Affiliate of Borrower that is not a deficiency judgment Borrower itself or other judgment establishing personal liability shall be sought against any officer, director, partner or equityholder of Borrower or any of its affiliates, or any Exculpated Person, except for foreclosure actions or any other appropriate actions or proceedings against Borrower in order to fully exercise Lender’s remedies in respect of, and to realize upon, the Collateral, and except for any actions to enforce any obligations expressly assumed or guaranteed by any guarantor, indemnitor or similar party (whether or not such party is an Exculpated Person) under the Loan Documents; provided however such foreclosure or appropriate actions or proceedings against Borrower shall, in no event, seek to enforce Borrower’s obligation to pay the Indebtedness or other personal judgments against BorrowerAffiliate.
(b) Borrower shall indemnify Lender and Agents and hold Lender and Agents harmless from and against any and all Damages to Lender and/or Agents (including the legal and other expenses of enforcing the obligations of Borrower under this Section 9.19 and the Sponsor under the Recourse Guaranty) resulting from or arising out of any of the following:following (the “Indemnified Liabilities”):
(i) any intentional physical Waste at the Property committed or permitted by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor;
(ii) any fraud or intentional misrepresentation committed by Borrower, the Sponsor or any of their respective Affiliates in connection with the Loan committed by Borrower, Sponsor or any affiliate Controlled by Borrower and/or SponsorLoan;
(iii) any willful misconduct by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor (including any bad faith interference by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor with the exercise any rights and remedies available to Lender as provided herein and in the other Loan Documents during the continuance of an Event of Default);
(ivii) the misappropriation or misapplication by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor of any funds (in violation of the Loan Documents Documents) by Borrower, the Sponsor or any of their respective Affiliates of any funds (including misappropriation or misapplication of Revenues, security deposits deposits, sales proceeds and/or Loss ProceedsProceeds and the violation of the last sentence of Section 5.7(d));
(viii) any voluntary Debt incurred by Borrower if and to the extent the continued existence Transfer of such Debt Collateral or voluntary Lien which is prohibited hereunder;
(iv) any breach by Borrower or the Sponsor of any representation or covenant regarding environmental matters contained in this Agreement or in the Environmental Indemnity Agreements;
(v) the occurrence of any filing by Borrower or any Property Owner Borrower GP under the Bankruptcy Code or any joining or colluding by Borrower or any Property Owner Borrower or any of their respective Affiliates (including Sponsor) in the filing of an involuntary case in respect of Borrower under the Bankruptcy Code;
(vi) the any material failure of Borrower or any Property Owner Borrower GP to pay or maintain the Policies or pay the amount of any deductible required thereunder following be a Casualty or other insurance claimSingle-Purpose Entity, provided that current cash flow is sufficient and available pursuant failure to the Approved Management Agreement for payment maintain adequate capital to conduct business operations shall not be considered a material failure of same and provided Lender permits cash flow from the Borrower or any Property Owner Borrower GP to be applied for such purposea Single-Purpose Entity;
(vii) the failure of Borrower to be, and to at all times have been, a Single-Purpose Entity, regardless of whether such failure to have been a Single-Purpose Entity prior deliver any certificates which evidence the equity interests pledged pursuant to the date hereof has been disclosed Pledge Agreement to LenderCollateral Agent, and including any and all liabilitiestogether with an executed stock, contingent membership or otherwisepartnership power, arising from or related to (x) the actionsas applicable, conduct and/or operating history of Borrower (or any Person merged into Borrower) prior to the Closing Date and (y) Borrower’s ownership (or the ownership of any Person merged into Borrower) of assets prior to the Closing Date that do not constitute a portion of the Collateral;in blank; and
(viii) removal of personal property by Borrower from the Property outside of the ordinary course of business during the continuance of an Event of Default in violation of the Loan Agreement, unless replaced any intentional physical waste with personal property of the same utility and of the same or greater value and utility; and
(ix) any fees or commissions paid by Borrower respect to any affiliate in violation of the terms of the Loan Documents. In addition to the foregoingProperty committed or permitted by Borrower, the Loan shall be fully recourse to Borrower and Sponsor, jointly and severally, if (i) there is any unauthorized Transfer of the Property or any other Collateral (including voluntary Liens and encumbrances on the Collateral other than Permitted Encumbrances) or Prohibited Change of Control or Prohibited Pledge, in each case, in violation of the Loan Documents, (ii) any petition for bankruptcy, insolvency, dissolution or liquidation under the Bankruptcy Code or any similar federal or state law is filed by, consented to, or acquiesced in by, Borrower, (iii) Borrower Sponsor or any of its affiliates (including Sponsor) shall have colluded with other creditors to cause an involuntary filing under the Bankruptcy Code or similar federal or state law with respect to Borrower, or Borrower shall have terminated one or more of the Independent Directors for the purpose of facilitating a bankruptcy filing, or (iv) Borrower fails to be, and to at all times have been, a Single-Purpose Entity, which failure results in a substantive consolidation of Borrower with any affiliate in a bankruptcy or similar proceeding. All of Borrower’s liabilities under this Section 9.19(b) shall be guaranteed by Sponsor pursuant to the Guarantytheir respective Affiliates.
(c) The foregoing limitations on personal liability shall in no way impair or constitute a waiver of the validity of the Notes, the Indebtedness secured by the Collateral, or the Liens on the Collateral, or the right of Lender, as mortgagee or secured party, to foreclose and/or enforce its rights with respect to the Collateral after an Event of Default. Nothing in this Agreement shall be deemed to be a waiver of any right which Lender may have under the Bankruptcy Code to file a claim for the full amount of the debt owing to Lender by Borrower or to require that all Collateral shall continue to secure all of the Indebtedness owing to Lender in accordance with the Loan Documents. Lender may seek a judgment on the Note (and, if necessary, name Borrower in such suit) as part of judicial proceedings to foreclose on under the Mortgage or to foreclose pursuant to any Collateral other Loan Documents, or as a prerequisite to any such foreclosure or to confirm any foreclosure or sale pursuant to power of sale thereunder, and in the event any suit is brought on the Note(s)Notes, or with respect to any Indebtedness or any judgment rendered in such judicial proceedings, such judgment shall constitute a Lien on and may will be and can be enforced on and against the Collateral and the rents, profits, issues, products and proceeds thereof. Nothing in this Agreement shall impair the right of Lender to accelerate the maturity of the Note during upon the continuance occurrence of an Event of Default in accordance with the Loan DocumentsDefault, nor shall anything in this Agreement impair or be construed to impair the right of Lender to seek personal judgments, and to enforce all rights and remedies under applicable law, jointly and severally law against any indemnitors and guarantors (including Sponsors) to the extent allowed by any applicable Loan Documentsguarantees (including the Recourse Guaranty). The provisions set forth in this Section 9.19 are not intended as a release or discharge of the obligations due under the Note or under any Loan Collateral Documents, but are intended as a limitation, to the extent provided in this SectionSection 9.19, on Lender’s right to ▇▇▇ for a deficiency or seek a personal judgment except as required in order to realize on the Collateralagainst Borrower or Sponsors.
(d) For the avoidance of doubt, the failure to pay trade payables as a result of insufficient cash flow from the Property shall not trigger liability under this Section 9.19.
Appears in 1 contract
Sources: Loan Agreement (American Casino & Entertainment Properties LLC)
Recourse. (a) Subject to the qualifications herein, Lender shall not enforce Borrower’s the liability and obligation of Borrower to pay the Indebtedness or perform and observe the other obligations set forth in this Agreement and the other Loan Documents by any action or proceeding wherein a deficiency judgment or other judgment establishing personal liability shall be sought against Borrower or any of its affiliates, or against any Exculpated Person, except for foreclosure actions or any other appropriate actions or proceedings against Borrower in order to the extent required to fully exercise Lender’s 's remedies in respect of, and to realize upon, the Collateral, and except for any actions to enforce the (i) Indemnified Liabilities, (ii) the liabilities of Borrower under this Agreement (other than the repayment of the Loan), the Cooperation Agreement any obligations expressly assumed required completion guaranty required pursuant to Section 5.23 and any indemnities set forth in the Loan Documents and (iii) the liabilities and indemnities of Sponsor (and any replacement guarantor or guaranteed by any guarantor, indemnitor or similar party (whether or not such party is an Exculpated Personindemnitor) under this Environmental Indemnity, the Loan Documents; provided however such foreclosure or appropriate actions or proceedings against Borrower shallGuaranty, in no eventthe Guaranty of Completion, seek any completion guaranty required pursuant to enforce Borrower’s obligation to pay Section 5.23 and the Indebtedness or other personal judgments against BorrowerCooperation Agreement.
(b) Borrower shall indemnify Lender and hold Lender harmless from and against any and all Damages to Lender (including the legal and other expenses of enforcing the obligations of Borrower under this Section and Sponsor under the Guaranty) to the extent resulting from or arising out of any of the followingfollowing (the "Indemnified Liabilities"), which Indemnified Liabilities shall be guaranteed by Sponsor pursuant to the Guaranty:
(i) any intentional or grossly negligent physical Waste at the Property committed or permitted by Borrower, Approved Music Venue Manager, Sponsor or any affiliate Controlled by Borrower and/or Sponsorof their respective affiliates;
(ii) any fraud or intentional misrepresentation in connection with the Loan committed by Borrower, Approved Music Venue Manager, Sponsor or any affiliate Controlled by Borrower and/or Sponsorof their respective affiliates;
(iii) any willful misconduct by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor (including any bad faith interference by BorrowerApproved Music Venue Manager, Sponsor or any affiliate Controlled of their respective affiliates (including (1) any litigation or other legal proceeding initiated by Borrower and/or Sponsor such Person in bad faith that delays, opposes impedes, obstructs, hinders, enjoins or otherwise interferes with or frustrates the efforts of Lender to exercise any rights and remedies available to Lender as provided herein and in the other Loan Documents during the continuance of an Event of DefaultDefault and (2) any refusal by Borrower to comply with Section 5.9 hereof);
(iv) the misappropriation or misapplication by Borrower, Approved Music Venue Manager, Sponsor or any affiliate Controlled by Borrower and/or Sponsor of their respective affiliates of any funds in violation of the Loan Documents (including misappropriation or misapplication of Revenues, security deposits and/or Loss Proceeds);
(v) any voluntary Debt incurred by Borrower or unauthorized Liens and encumbrances on the Collateral, if and to the extent the continued existence of such Debt is Debt, Liens and encumbrances are prohibited hereunder;
(vi) any breach by Borrower or Sponsor of any representation or covenant regarding environmental matters contained in this Agreement or in the Environmental Indemnity;
(vii) the failure to pay or maintain the Policies or pay the amount of any deductible required thereunder following a Casualty or other insurance claim, provided that current cash flow is sufficient and available pursuant to the Approved Management Agreement for payment of same and provided Lender permits cash flow from the Property to be applied for such purpose;
(viiviii) the failure of Borrower or Approved Music Venue Manager to be, and to at all times have been, a Single-Purpose Entity, regardless of whether such failure to have been a Single-Purpose Entity prior to the date hereof has been disclosed to Lender, and including any and all liabilities, contingent or otherwise, arising from or related to (x) the actions, conduct and/or operating history of Borrower or Approved Music Venue Manager, as appropriate (or any Person merged into BorrowerBorrower or Approved Music Venue Manager, as appropriate) prior to the Closing Date and (y) Borrower’s 's or Approved Music Venue's ownership (or the ownership of any Person merged into BorrowerBorrower or Approved Music Venue Manager) of assets prior to the Closing Date that do not constitute a portion of the CollateralCollateral LOAN AGREEMENT – Page 117 and/or the filing by any Person of a motion for substantive consolidation in bankruptcy citing any such failure (for the avoidance of doubt, the recourse described in this clause shall be in addition to the full recourse for a substantive consolidation described below);
(viiiix) removal of personal property by Borrower from the Property outside owned by Borrower, Approved Music Venue Manager or any of the ordinary course of business their affiliates during the continuance or in anticipation of an Event of Default in violation of the Loan AgreementDefault, unless replaced with personal property of the same utility and of the same or greater value and utility; and;
(ixx) any fees or commissions paid by Borrower or Approved Music Venue Manager to any affiliate in violation of the terms of the Loan Documents;
(xi) any transfer taxes resulting from Lender's exercise of remedies following any Event of Default;
(xii) the contesting or opposition by Borrower, Approved Music Venue Manager, Sponsor or any of their respective affiliates of any motion filed by Lender for relief from the automatic stay in any bankruptcy proceeding of any Required SPE;
(xiii) unauthorized Transfer of the Collateral (including unauthorized Liens and encumbrances on the Collateral) in violation of the Loan Documents and in any event subject to Borrower's right to contest any Liens in accordance with the terms of this Agreement; and
(xiv) if (i) either (A) the Approved Hotel Operating Agreement or the Approved Music Venue Lease (or the right to operate the applicable portion of the Property thereunder) shall be cancelled, surrendered or terminated by Borrower or any affiliate of Borrower, or by reason of any failure of Borrower or any affiliate of Borrower to perform its obligations in connection therewith and shall not be replaced as required hereunder upon the expiration, cancellation surrender or termination of the Approved Hotel Operating Agreement or the Approved Music Venue Lease, as appropriate, or (B) Borrower materially amends or modifies the Approved Hotel Operating Agreement or the Approved Music Venue Lease without the prior written consent of Lender. In addition to the foregoing, the Loan and all Indebtedness shall be fully recourse to Borrower and Sponsor, jointly and severally, if (i) there is any unauthorized Transfer of the Property or any other the Account Collateral (including voluntary unauthorized Liens and encumbrances on the Collateral other than Permitted EncumbrancesCollateral) or Prohibited Change of Control or Prohibited Pledge, in each case, in violation of the Loan DocumentsDocuments and in any event subject to Borrower's right to contest any Liens in accordance with the terms of this Agreement, (ii) any petition for bankruptcy, insolvency, dissolution or liquidation under the Bankruptcy Code or any similar federal or state law is filed by, consented to, or acquiesced in by, Borrowerany Required SPE, (iii) Borrower any Required SPE or any of its their respective affiliates (including Sponsor) shall have colluded with other creditors to cause an involuntary filing under the Bankruptcy Code or similar federal or state law with respect to Borrowerany Required SPE, or Borrower any Required SPE shall have terminated one or more of the Independent Directors for the purpose of facilitating a bankruptcy filing, or (iv) Borrower any Required SPE fails to be, and to at all times have been, a Single-Purpose Entity, which failure (as determined LOAN AGREEMENT – Page 118 by a court of competent jurisdiction cites as a contributing factor) results in a substantive consolidation of Borrower with any affiliate in a bankruptcy or similar proceeding. All of Borrower’s liabilities under this Section 9.19(b) shall be guaranteed by Sponsor pursuant to the Guaranty.
(c) The foregoing limitations on personal liability shall in no way impair or constitute a waiver of the validity of the Notes, the Indebtedness secured by the Collateral, or the Liens on the Collateral, or the right of Lender, as mortgagee or secured party, to foreclose and/or enforce its rights with respect to the Collateral after an Event of Default. Nothing in this Agreement shall be deemed to be a waiver of any right which Lender may have under the Bankruptcy Code to file a claim for the full amount of the debt owing to Lender by Borrower or to require that all Collateral shall continue to secure all of the Indebtedness owing to Lender in accordance with the Loan Documents. Lender may seek a judgment on the Note (and, if necessary, name Borrower in such suit) as part of judicial proceedings to foreclose on any Collateral or as a prerequisite to any such foreclosure or to confirm any foreclosure or sale pursuant to power of sale thereunder, and in the event any suit is brought on the Note(s)Notes, or with respect to any Indebtedness or any judgment rendered in such judicial proceedings, such judgment shall constitute a Lien on and may be enforced on and against the Collateral and the rents, profits, issues, products and proceeds thereof. Nothing in this Agreement shall impair the right of Lender to accelerate the maturity of the Note during upon the continuance occurrence of an Event of Default in accordance with the Loan DocumentsDefault, nor shall anything in this Agreement impair or be construed to impair the right of Lender to seek personal judgments, and to enforce all rights and remedies under applicable law, jointly and severally against any indemnitors and guarantors to the extent allowed by any applicable Loan Documents. The provisions set forth in this Section are not intended as a release or discharge of the obligations due under the Note or under any Loan Documents, but are intended as a limitation, to the extent provided in this Section, on Lender’s 's right to ▇▇▇ for a deficiency or seek a personal judgment except as required in order to realize on the Collateral.
(d) For the avoidance of doubt, the failure to pay trade payables as a result of insufficient cash flow from the Property shall not trigger liability under this Section 9.19.
Appears in 1 contract
Recourse. (a) Subject Notwithstanding the foregoing, the agreement of Lender not to the qualifications herein, Lender shall not enforce Borrower’s obligation to pay the Indebtedness by any action or proceeding wherein a deficiency judgment or other judgment establishing personal pursue recourse liability as set forth in Section 13.1 above SHALL BECOME NULL AND VOID and shall be sought against Borrower or of no further force and effect in the event that any of the following occur: (i) Borrower fails to maintain its affiliatesstatus as a Special Purpose Entity, as required by, and in accordance with the terms and provisions of Section 4.2 hereof, or any Exculpated Person, except for foreclosure actions or any other appropriate actions or proceedings against Borrower in order to fully exercise Lender’s remedies in respect of, and to realize upon, otherwise breaches the Collateral, and except for any actions to enforce any obligations expressly assumed or guaranteed by any guarantor, indemnitor or similar party (whether or not such party is an Exculpated Person) under single purpose entity covenants of the Loan Documents; provided however such foreclosure or appropriate actions or proceedings against Borrower shall, in no event, seek to enforce Borrower’s obligation to pay the Indebtedness or other personal judgments against Borrower.
(b) Borrower shall indemnify Lender and hold Lender harmless from and against any and all Damages to Lender (including the legal and other expenses of enforcing the obligations of Borrower under this Section and Sponsor under the Guaranty) resulting from or arising out of any of the following:
(i) any intentional physical Waste at the Property committed or permitted by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor;
(ii) Borrower fails to obtain Lender’s prior written consent to any fraud or intentional misrepresentation in connection with the Loan committed by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor;
(iii) any willful misconduct by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor (including any bad faith interference by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor with the exercise any rights and remedies available to Lender as provided herein and in the other Loan Documents during the continuance of an Event of Default);
(iv) the misappropriation or misapplication by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor of any funds in violation of the Loan Documents (including misappropriation or misapplication of Revenues, security deposits and/or Loss Proceeds);
(v) any voluntary Debt incurred by Borrower if and to the extent the continued existence of such Debt is prohibited hereunder;
(vi) the failure to pay or maintain the Policies or pay the amount of any deductible required thereunder following a Casualty subordinate financing or other insurance claim, provided that current cash flow is sufficient and available pursuant to the Approved Management Agreement for payment of same and provided Lender permits cash flow from the Property to be applied for such purpose;
(vii) the failure of Borrower to be, and to at all times have been, a Single-Purpose Entity, regardless of whether such failure to have been a Single-Purpose Entity prior to the date hereof has been disclosed to Lender, and including any and all liabilities, contingent or otherwise, arising from or related to (x) the actions, conduct and/or operating history of Borrower (or any Person merged into Borrower) prior to the Closing Date and (y) Borrower’s ownership (or the ownership of any Person merged into Borrower) of assets prior to the Closing Date that do not constitute a portion of the Collateral;
(viii) removal of personal property by Borrower from the Property outside of the ordinary course of business during the continuance of an Event of Default in violation of the Loan Agreement, unless replaced with personal property of the same utility and of the same or greater value and utility; and
(ix) any fees or commissions paid by Borrower to any affiliate in violation of the terms of the Loan Documents. In addition to the foregoing, the Loan shall be fully recourse to Borrower and Sponsor, jointly and severally, if (i) there is any unauthorized Transfer of voluntary lien encumbering the Property or any other Collateral part thereof or any interest therein or any direct or indirect beneficial interest in Borrower (including voluntary Liens and encumbrances on the Collateral other than Permitted Encumbrancesincluding, without limitation, any mezzanine financing) or Prohibited Change of Control or Prohibited Pledge, in each case, in violation of the Loan Documents; (iii) Borrower fails to obtain Lender’s prior written consent to any assignment, transfer, or conveyance of the Property or any part thereof or any interest therein or any direct or indirect beneficial interest in Borrower in violation of the Loan Documents; (iiiv) a receiver, liquidator or trustee of Borrower of any guarantor or indemnitor shall be appointed or if Borrower or any guarantor or indemnitor shall be adjudicated as bankrupt or insolvent, or if any petition for bankruptcy, insolvencyreorganization or arrangement pursuant to federal bankruptcy law, dissolution or liquidation under the Bankruptcy Code or any similar federal or state law is law, shall be filed by, consented to, or acquiesced in by, Borrower, Borrower or any guarantor or indemnitor or if any proceeding for the dissolution or liquidation of Borrower or of any guarantor or indemnitor shall be instituted by Borrower or any guarantor or any indemnitor; (iiiv) Borrower or any of its affiliates (including Sponsor) guarantor or any indemnitor shall have colluded with other creditors to cause an involuntary bankruptcy filing under the Bankruptcy Code or similar federal or state law with respect to Borrower, or Borrower shall have terminated one or more of the Independent Directors for the purpose of facilitating a bankruptcy filing, or (iv) Borrower fails to be, and to at all times have been, a Single-Purpose Entity, which failure results in a substantive consolidation of Borrower with any affiliate in a bankruptcy or similar proceeding. All of Borrower’s liabilities under this Section 9.19(b) shall be guaranteed by Sponsor pursuant to the Guaranty.
(c) The foregoing limitations on personal liability shall in no way impair or constitute a waiver of the validity of the Notes, the Indebtedness secured by the Collateral, or the Liens on the Collateral, or the right of Lender, as mortgagee or secured party, to foreclose and/or enforce its rights with respect to the Collateral after an Event of Default. Nothing in this Agreement shall be deemed to be a waiver of any right which Lender may have under the Bankruptcy Code to file a claim for the full amount of the debt owing to Lender by Borrower or to require that all Collateral shall continue to secure all of the Indebtedness owing to Lender in accordance with the Loan Documents. Lender may seek a judgment on the Note (and, if necessary, name Borrower in such suit) as part of judicial proceedings to foreclose on any Collateral guarantor or as a prerequisite to any such foreclosure or to confirm any foreclosure or sale pursuant to power of sale thereunder, and in the event any suit is brought on the Note(s), or with respect to any Indebtedness or any judgment rendered in such judicial proceedings, such judgment shall constitute a Lien on and may be enforced on and against the Collateral and the rents, profits, issues, products and proceeds thereof. Nothing in this Agreement shall impair the right of Lender to accelerate the maturity of the Note during the continuance of an Event of Default in accordance with the Loan Documents, nor shall anything in this Agreement impair or be construed to impair the right of Lender to seek personal judgments, and to enforce all rights and remedies under applicable law, jointly and severally against any indemnitors and guarantors to the extent allowed by any applicable Loan Documents. The provisions set forth in this Section are not intended as a release or discharge of the obligations due under the Note or under any Loan Documents, but are intended as a limitation, to the extent provided in this Section, on Lender’s right to ▇▇▇ for a deficiency or seek a personal judgment except as required in order to realize on the Collateral.
(d) For the avoidance of doubt, the failure to pay trade payables as a result of insufficient cash flow from the Property shall not trigger liability under this Section 9.19.indemnitor;
Appears in 1 contract
Sources: Mortgage and Security Agreement (Paladin Realty Income Properties Inc)
Recourse. (a) Subject Each of the Indemnitors agrees that the obligations of Indemnitors hereunder are separate, independent of and in addition to Indemnitors' respective obligations under the qualifications herein, Lender shall not enforce Borrower’s obligation to pay the Indebtedness by any action or proceeding wherein a deficiency judgment or other judgment establishing personal liability shall be sought against Borrower or any of its affiliates, or any Exculpated Person, except for foreclosure actions Credit Agreement or any other appropriate actions or proceedings against Borrower in order to fully exercise Lender’s remedies in respect of, and to realize upon, the Collateral, and except for any actions to enforce any obligations expressly assumed or guaranteed by any guarantor, indemnitor or similar party (whether or not such party is an Exculpated Person) under the Loan Documents; provided however such foreclosure or appropriate actions or proceedings against Borrower shall, in no event, seek to enforce Borrower’s obligation to pay the Indebtedness or other personal judgments against BorrowerCredit Document.
(b) Borrower Indemnitors agree that a separate action may be brought to enforce the provisions of this Indemnity, which shall indemnify Lender and hold Lender harmless from and in no way be deemed to be an action on the Credit Party Obligations, whether or not the Lenders would be entitled to a deficiency judgment following a judicial foreclosure or sale under any Deed of Trust. Indemnitors waive any right to require that any action be brought by the Lenders against Indemnitors or any and all Damages to Lender (including the legal and other expenses of enforcing the obligations of Borrower under this Section and Sponsor Person, or that any other remedy under the Guaranty) resulting from or arising out of Credit Agreement, this Indemnity, any of the following:
(i) any intentional physical Waste at the Property committed or permitted by Borrowerother Credit Document, Sponsor or any affiliate Controlled other document entered into by Borrower and/or Sponsor;
(ii) any fraud or intentional misrepresentation Indemnitors in connection with the Loan committed by Borrowerforegoing be exercised. The Lenders may, Sponsor or any affiliate Controlled by Borrower and/or Sponsor;
(iii) any willful misconduct by Borrowerat their option, Sponsor or any affiliate Controlled by Borrower and/or Sponsor (including any bad faith interference by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor with the exercise any rights and remedies available to Lender as provided herein and proceed against Indemnitors in the other Loan Documents during the continuance of an Event of Default);
(iv) the misappropriation first instance to collect monies when due or misapplication by Borrowerto obtain performance under this Indemnity, Sponsor or any affiliate Controlled by Borrower and/or Sponsor of any funds in violation of the Loan Documents (including misappropriation or misapplication of Revenues, security deposits and/or Loss Proceeds);
(v) any voluntary Debt incurred by Borrower if and to the extent the continued existence of such Debt is prohibited hereunder;
(vi) the failure to pay or maintain the Policies or pay the amount of any deductible required thereunder following a Casualty or other insurance claim, provided that current cash flow is sufficient and available pursuant to the Approved Management Agreement for payment of same and provided Lender permits cash flow from the Property to be applied for such purpose;
(vii) the failure of Borrower to be, and to at all times have been, a Single-Purpose Entity, regardless of whether such failure to have been a Single-Purpose Entity prior to the date hereof has been disclosed to Lender, and including any and all liabilities, contingent or otherwise, arising from or related to (x) the actions, conduct and/or operating history of Borrower (or any Person merged into Borrower) prior to the Closing Date and (y) Borrower’s ownership (or the ownership of any Person merged into Borrower) of assets prior to the Closing Date that do not constitute a portion of the Collateral;
(viii) removal of personal property by Borrower from the Property outside of the ordinary course of business during the continuance of an Event of Default in violation of the Loan Agreement, unless replaced with personal property of the same utility and of the same or greater value and utility; and
(ix) any fees or commissions paid by Borrower to any affiliate in violation of the terms of the Loan Documents. In addition to the foregoing, the Loan shall be fully recourse to Borrower and Sponsor, jointly and severally, if (i) there is any unauthorized Transfer of the Property without first proceeding against Indemnitors or any other Collateral (including voluntary Liens indemnitors or any other Person and encumbrances on without first resorting to any other indemnity, the Collateral Credit Agreement, this Indemnity, any Credit Document, or any other than Permitted Encumbrances) document entered into by Indemnitors in connection with the foregoing or Prohibited Change of Control or Prohibited Pledge, in each case, in violation of the Loan Documents, (ii) any petition for bankruptcy, insolvency, dissolution or liquidation other remedy under the Bankruptcy Code Credit Agreement, this Indemnity, any Credit Document, or any similar federal or state law is filed by, consented to, or acquiesced other document entered into by Indemnitors in by, Borrower, (iii) Borrower or any of its affiliates (including Sponsor) shall have colluded connection with other creditors to cause an involuntary filing under the Bankruptcy Code or similar federal or state law with respect to Borrower, or Borrower shall have terminated one or more of the Independent Directors for the purpose of facilitating a bankruptcy filing, or (iv) Borrower fails to be, and to at all times have been, a Single-Purpose Entity, which failure results in a substantive consolidation of Borrower with any affiliate in a bankruptcy or similar proceeding. All of Borrower’s liabilities under this Section 9.19(b) shall be guaranteed by Sponsor pursuant to the Guarantyforegoing.
(c) The foregoing limitations on personal liability shall in no way impair or constitute a waiver This Indemnity is not given as additional security for the Credit Party Obligations and is entirely independent of the validity Credit Party Obligations (except as provided in Section 5), and shall not be measured or affected by any amounts at any time owing under the other Credit Documents, the sufficiency or insufficiency of any collateral (including without limitation the Premises) given to the Lenders to secure repayment of the NotesCredit Party Obligations, or the Indebtedness consideration given by the Lenders or any other party in order to acquire the Premises or any portion thereof. None of the obligations of Indemnitors hereunder shall be in any way secured by the Collateral, or the Liens on the Collateral, or the right of Lender, as mortgagee or secured party, to foreclose and/or enforce its rights with respect to the Collateral after an Event of Default. Nothing in this Agreement shall be deemed to be a waiver of any right which Lender may have under the Bankruptcy Code to file a claim for the full amount lien of the debt owing to Lender by Borrower or to require that all Collateral shall continue to secure all Deed of the Indebtedness owing to Lender in accordance with the Loan Documents. Lender may seek a judgment on the Note (and, if necessary, name Borrower in such suit) as part of judicial proceedings to foreclose on any Collateral or as a prerequisite to any such foreclosure or to confirm any foreclosure or sale pursuant to power of sale thereunder, and in the event any suit is brought on the Note(s), or with respect to any Indebtedness Trust or any judgment rendered in such judicial proceedings, such judgment shall constitute a Lien on and may be enforced on and against the Collateral and the rents, profits, issues, products and proceeds thereof. Nothing in this Agreement shall impair the right of Lender to accelerate the maturity of the Note during the continuance of an Event of Default in accordance with the Loan Documents, nor shall anything in this Agreement impair or be construed to impair the right of Lender to seek personal judgments, and to enforce all rights and remedies under applicable law, jointly and severally against any indemnitors and guarantors to the extent allowed by any applicable Loan Documents. The provisions set forth in this Section are not intended as a release or discharge of the obligations due under the Note or under any Loan Documents, but are intended as a limitation, to the extent provided in this Section, on Lender’s right to ▇▇▇ for a deficiency or seek a personal judgment except as required in order to realize on the Collateralother Credit Document.
(d) For the avoidance of doubt, the failure to pay trade payables as a result of insufficient cash flow from the Property shall not trigger liability under this Section 9.19.
Appears in 1 contract
Recourse. (a) Subject to Except as set forth in Section 9.19(b), in the qualifications hereinEnvironmental Indemnities, Lender in the Cooperation Agreement, in Section 5.18 and in Section 9.14, no recourse shall not enforce Borrower’s obligation to pay be had for the Indebtedness by against any action or proceeding wherein a deficiency judgment or other judgment establishing personal liability shall be sought against affiliate of Borrower or any officer, director, partner or equityholder of its affiliates, Borrower or any Exculpated Person, except for foreclosure actions or any such affiliate and recourse to Borrower shall be limited to the Liens of Lender on the Properties and the other appropriate actions or proceedings against Borrower in order to fully exercise Lender’s remedies in respect of, and to realize upon, the Collateral, and except for any actions to enforce any obligations expressly assumed or guaranteed by any guarantor, indemnitor or similar party (whether or not such party is an Exculpated Person) under the Loan Documents; provided however such foreclosure or appropriate actions or proceedings against Borrower shall, in no event, seek to enforce Borrower’s obligation to pay the Indebtedness or other personal judgments against Borrower.
(b) Borrower shall and the Sponsor (as evidenced by the Sponsor’s signature below) agree to jointly and severally indemnify Lender and hold Lender harmless from and against any and all Damages to Lender (including the legal and other expenses of enforcing the obligations of the Borrower and the Sponsor under this Section and Sponsor under the Guaranty9.19) resulting from or arising out of any of the followingfollowing (the “Indemnified Liabilities”), which Indemnified Liabilities shall be guaranteed by Sponsor pursuant to the Guaranty:
(i) any intentional physical Waste at with respect to any of the Property Properties committed or permitted by Borrower, the Sponsor or any affiliate Controlled by Borrower and/or Sponsorof their respective affiliates;
(ii) any fraud or intentional misrepresentation in connection with the Loan committed by Borrower, the Sponsor or any affiliate Controlled by Borrower and/or Sponsorof their respective affiliates;
(iii) any willful misconduct by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor (including any bad faith interference by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor with the exercise any rights and remedies available to Lender as provided herein and in the other Loan Documents during the continuance of an Event of Default);
(iv) the misappropriation or misapplication by Borrower, the Sponsor or any affiliate Controlled by Borrower and/or Sponsor of their respective affiliates of any funds in violation of the Loan Documents (including misappropriation or misapplication of Revenues, security deposits and/or Loss ProceedsProceeds and the violation of the last sentence of Section 5.7(d));
(iv) any Transfer of Collateral, the creation of any voluntary Lien on Collateral or the collusion by Borrower or any Affiliate of Borrower in the creation of an involuntary Lien on Collateral, or Change of Control which is prohibited hereunder;
(v) any voluntary Debt incurred breach by Borrower if and to or the extent Sponsor of any representation or covenant regarding environmental matters contained in this Agreement or in the continued existence of such Debt is prohibited hereunderEnvironmental Indemnities;
(vi) the failure to pay or maintain the Policies or pay the amount of Borrower, at any deductible required thereunder following a Casualty or other insurance claimtime, provided that current cash flow is sufficient and available pursuant to the Approved Management Agreement for payment of same and provided Lender permits cash flow from the Property to be applied for such purpose;a Single-Purpose Entity; G▇▇▇▇▇▇ Sachs Commercial Mortgage Capital, L.P. Loan Agreement Life Time Fitness Portfolio
(vii) the failure of Borrower to be, and pay any Taxes or to at all times have been, a Single-Purpose Entity, regardless of whether such failure to have been a Single-Purpose Entity prior maintain any insurance policies required by this Agreement except to the date hereof has been disclosed extent sufficient funds for such payment and maintenance are then held in the Basic Carrying Costs Escrow Account and Lender does not then have the right to Lender, and including any and all liabilities, contingent cause the application of such funds to the Loan or otherwise, arising from or related to (x) the actions, conduct and/or operating history other obligations of Borrower (or any Person merged into Borrower) prior to the Closing Date and (y) Borrower’s ownership (or the ownership of any Person merged into Borrower) of assets prior to the Closing Date that do not constitute a portion of the Collateralhereunder;
(viii) removal the occurrence of personal property any filing by Borrower from the Property outside of the ordinary course of business during the continuance of an Event of Default in violation of the Loan Agreement, unless replaced with personal property of the same utility and of the same or greater value and utility; and
(ix) any fees or commissions paid by Borrower to any affiliate in violation of the terms of the Loan Documents. In addition to the foregoing, the Loan shall be fully recourse to Borrower and Sponsor, jointly and severally, if (i) there is any unauthorized Transfer of the Property or any other Collateral (including voluntary Liens and encumbrances on the Collateral other than Permitted Encumbrances) or Prohibited Change of Control or Prohibited Pledge, in each case, in violation of the Loan Documents, (ii) any petition for bankruptcy, insolvency, dissolution or liquidation under the Bankruptcy Code or any similar federal joining or state law is filed by, consented to, or acquiesced in by, Borrower, (iii) colluding by Borrower or any of its affiliates (including Sponsor) shall have colluded with other creditors to cause in the filing of an involuntary filing case in respect of Borrower under the Bankruptcy Code Code; provided that, because the Damages to Lender resulting from the occurrence of an event described in this clause (vii) (including the costs to Lender of delay in realizing upon the Collateral and the additional resources required of Lender in connection with such delay) would be significant but difficult to quantify, the Damages payable to Lender upon such an occurrence shall be deemed to equal 10% of the Loan Amount, which represents Lender’s, Borrower’s and Sponsor’s reasonable and fair estimates of the amount of such Damages and is agreed by such parties to constitute reasonable liquidated damages and not a penalty; and
(ix) the failure of Borrower to enforce or similar federal of Sponsor to pay and perform its obligations under any guaranty of any Lease to LTF CO.
(c) The liability of the Sponsor and Borrower under Section 9.19(b) shall be direct and immediate and not conditional or state law contingent upon the pursuit of any remedies against Borrower or any other Person, nor against the Collateral, and shall not be impaired or limited by any event, including, without limitation, the following events, in each case whether occurring with respect or without notice to the Sponsor or with or without consideration:
(i) any extensions of time for performance required by any of the Loan Documents or any extension or renewal of the Notes;
(ii) any sale, assignment or foreclosure of the Notes, the Mortgages or any of the other Loan Documents or any sale or transfer of any or all of the Properties;
(iii) any Assumption or any other change in the composition of Borrower including the withdrawal or removal of the Sponsor from any current or future position of ownership, management or control of Borrower;
(iv) the accuracy or inaccuracy of the representations made by Borrower in any of the Loan Documents;
(v) the release of Borrower or of any other Person from performance or observance of any of the agreements, covenants, terms or Borrower shall have terminated conditions contained in any of the Loan Documents by operation of law, Lender’s voluntary act or otherwise; or
(vi) the modification of the terms of any one or more of the Independent Directors Loan Documents. G▇▇▇▇▇▇ S▇▇▇▇ Commercial Mortgage Capital, L.P. Loan Agreement Life Time Fitness Portfolio The Sponsor acknowledges that Lender would not make the Loan but for the purpose personal liability undertaken by the Sponsor in this Agreement and in the Guaranty. The Sponsor agrees that its rights and obligations are subject to the terms and conditions of facilitating a bankruptcy filing, or (iv) Borrower fails to be, and to at all times have been, a Single-Purpose Entity, which failure results in a substantive consolidation of Borrower with any affiliate in a bankruptcy or similar proceeding. All of Borrower’s liabilities under this Section 9.19(b) shall be guaranteed by Sponsor pursuant to the Guaranty.
(cd) The foregoing limitations on personal liability shall in no way impair or constitute a waiver of the validity of the Notes, the Indebtedness secured by the Collateral, or the Liens on the Collateral, or the right of Lender, as mortgagee or secured party, to foreclose and/or enforce its rights with respect to the Collateral after an Event of Default. Nothing in this Agreement shall be deemed to be a waiver of any right which Lender may have under the United States Bankruptcy Code to file a claim for the full amount of the debt owing to Lender by Borrower or to require that all Collateral shall continue to secure all of the Indebtedness owing to Lender in accordance with the Loan Documents. Lender may seek a judgment on the Note (and, if necessary, name Borrower in such suit) as part of judicial proceedings to foreclose on under the Mortgages or to foreclose pursuant to any Collateral other Loan Documents, or as a prerequisite to any such foreclosure or to confirm any foreclosure or sale pursuant to power of sale thereunder, and in the event any suit is brought on the Note(s)Notes, or with respect to any Indebtedness or any judgment rendered in such judicial proceedings, such judgment shall constitute a Lien on and may will be and can be enforced on and against the Collateral and the rents, profits, issues, products and proceeds thereof. Nothing in this Agreement shall impair the right of Lender to accelerate the maturity of the Note during upon the continuance occurrence of an Event of Default in accordance with the Loan DocumentsDefault, nor shall anything in this Agreement impair or be construed to impair the right of Lender to seek personal judgments, and to enforce all rights and remedies under applicable law, jointly and severally against any indemnitors and guarantors to the extent allowed by any applicable Loan Documentsguarantees. The provisions set forth in this Section 9.19 are not intended as a release or discharge of the obligations due under the Note or under any Loan Collateral Documents, but are intended as a limitation, to the extent provided in this Section, on Lender’s right to ▇s▇▇ for a deficiency or seek a personal judgment except as required in order to realize on the Collateralagainst Borrower or Sponsors.
(d) For the avoidance of doubt, the failure to pay trade payables as a result of insufficient cash flow from the Property shall not trigger liability under this Section 9.19.
Appears in 1 contract
Recourse. (a) Subject Each of the Indemnitors agrees that the obligations of Indemnitors hereunder are separate, independent of and in addition to Indemnitors' respective obligations under the qualifications herein, Lender shall not enforce Borrower’s obligation to pay the Indebtedness by any action or proceeding wherein a deficiency judgment or other judgment establishing personal liability shall be sought against Borrower or any of its affiliates, or any Exculpated Person, except for foreclosure actions Indenture or any other appropriate actions or proceedings against Borrower in order to fully exercise Lender’s remedies in respect of, and to realize upon, the Collateral, and except for any actions to enforce any obligations expressly assumed or guaranteed by any guarantor, indemnitor or similar party (whether or not such party is an Exculpated Person) under the Loan Documents; provided however such foreclosure or appropriate actions or proceedings against Borrower shall, in no event, seek to enforce Borrower’s obligation to pay the Indebtedness or other personal judgments against BorrowerTransaction Document.
(b) Borrower Indemnitors agree that a separate action may be brought to enforce the provisions of this Indemnity, which shall indemnify Lender and hold Lender harmless from and in no way be deemed to be an action on the Notes, whether or not the Trustee would be entitled to a deficiency judgment following a judicial foreclosure or sale under any Deed of Trust. Indemnitors waive any right to require that any action be brought by the Trustee or any holder of a Note against Indemnitors or any and all Damages to Lender (including the legal and other expenses of enforcing the obligations of Borrower under this Section and Sponsor Person, or that any other remedy under the Guaranty) resulting from or arising out of Indenture, this Indemnity, any of the following:
(i) any intentional physical Waste at the Property committed or permitted by Borrowerother Collateral Document, Sponsor or any affiliate Controlled other document entered into by Borrower and/or Sponsor;
(ii) any fraud or intentional misrepresentation Indemnitors in connection with the Loan committed by Borrowerforegoing be exercised. The Trustee may, Sponsor or any affiliate Controlled by Borrower and/or Sponsor;
(iii) any willful misconduct by Borrowerat its option, Sponsor or any affiliate Controlled by Borrower and/or Sponsor (including any bad faith interference by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor with the exercise any rights and remedies available to Lender as provided herein and proceed against Indemnitors in the other Loan Documents during the continuance of an Event of Default);
(iv) the misappropriation first instance to collect monies when due or misapplication by Borrowerto obtain performance under this Indemnity, Sponsor or any affiliate Controlled by Borrower and/or Sponsor of any funds in violation of the Loan Documents (including misappropriation or misapplication of Revenues, security deposits and/or Loss Proceeds);
(v) any voluntary Debt incurred by Borrower if and to the extent the continued existence of such Debt is prohibited hereunder;
(vi) the failure to pay or maintain the Policies or pay the amount of any deductible required thereunder following a Casualty or other insurance claim, provided that current cash flow is sufficient and available pursuant to the Approved Management Agreement for payment of same and provided Lender permits cash flow from the Property to be applied for such purpose;
(vii) the failure of Borrower to be, and to at all times have been, a Single-Purpose Entity, regardless of whether such failure to have been a Single-Purpose Entity prior to the date hereof has been disclosed to Lender, and including any and all liabilities, contingent or otherwise, arising from or related to (x) the actions, conduct and/or operating history of Borrower (or any Person merged into Borrower) prior to the Closing Date and (y) Borrower’s ownership (or the ownership of any Person merged into Borrower) of assets prior to the Closing Date that do not constitute a portion of the Collateral;
(viii) removal of personal property by Borrower from the Property outside of the ordinary course of business during the continuance of an Event of Default in violation of the Loan Agreement, unless replaced with personal property of the same utility and of the same or greater value and utility; and
(ix) any fees or commissions paid by Borrower to any affiliate in violation of the terms of the Loan Documents. In addition to the foregoing, the Loan shall be fully recourse to Borrower and Sponsor, jointly and severally, if (i) there is any unauthorized Transfer of the Property without first proceeding against Indemnitors or any other Indemnitors or any other Person and without first resorting to any other indemnity, the Indenture, this Indemnity, any Collateral (including voluntary Liens and encumbrances on Document, or any other document entered into by Indemnitors in connection with the Collateral foregoing or any other than Permitted Encumbrances) or Prohibited Change of Control or Prohibited Pledge, in each case, in violation of the Loan Documents, (ii) any petition for bankruptcy, insolvency, dissolution or liquidation remedy under the Bankruptcy Code Indenture, this Indemnity, any Collateral Document, or any similar federal or state law is filed by, consented to, or acquiesced other document entered into by Indemnitors in by, Borrower, (iii) Borrower or any of its affiliates (including Sponsor) shall have colluded connection with other creditors to cause an involuntary filing under the Bankruptcy Code or similar federal or state law with respect to Borrower, or Borrower shall have terminated one or more of the Independent Directors for the purpose of facilitating a bankruptcy filing, or (iv) Borrower fails to be, and to at all times have been, a Single-Purpose Entity, which failure results in a substantive consolidation of Borrower with any affiliate in a bankruptcy or similar proceeding. All of Borrower’s liabilities under this Section 9.19(b) shall be guaranteed by Sponsor pursuant to the Guarantyforegoing.
(c) The foregoing limitations on personal liability shall in no way impair or constitute a waiver This Indemnity is not given as additional security for the Notes and is entirely independent of the validity Notes (except as provided in Section 5), and shall not be measured or affected by any amounts at any time owing under the other Transaction Documents, the sufficiency or insufficiency of any collateral (including without limitation the Premises) given to the Trustee to secure repayment of the Notes, or the Indebtedness consideration given by the Trustee or any other party in order to acquire the Premises or any portion thereof. None of the obligations of Indemnitors hereunder shall be in any way secured by the Collateral, or the Liens on the Collateral, or the right of Lender, as mortgagee or secured party, to foreclose and/or enforce its rights with respect to the Collateral after an Event of Default. Nothing in this Agreement shall be deemed to be a waiver of any right which Lender may have under the Bankruptcy Code to file a claim for the full amount lien of the debt owing to Lender by Borrower or to require that all Collateral shall continue to secure all Deed of the Indebtedness owing to Lender in accordance with the Loan Documents. Lender may seek a judgment on the Note (and, if necessary, name Borrower in such suit) as part of judicial proceedings to foreclose on any Collateral or as a prerequisite to any such foreclosure or to confirm any foreclosure or sale pursuant to power of sale thereunder, and in the event any suit is brought on the Note(s), or with respect to any Indebtedness Trust or any judgment rendered in such judicial proceedings, such judgment shall constitute a Lien on and may be enforced on and against the Collateral and the rents, profits, issues, products and proceeds thereof. Nothing in this Agreement shall impair the right of Lender to accelerate the maturity of the Note during the continuance of an Event of Default in accordance with the Loan Documents, nor shall anything in this Agreement impair or be construed to impair the right of Lender to seek personal judgments, and to enforce all rights and remedies under applicable law, jointly and severally against any indemnitors and guarantors to the extent allowed by any applicable Loan Documents. The provisions set forth in this Section are not intended as a release or discharge of the obligations due under the Note or under any Loan Documents, but are intended as a limitation, to the extent provided in this Section, on Lender’s right to ▇▇▇ for a deficiency or seek a personal judgment except as required in order to realize on the Collateralother Transaction Document.
(d) For the avoidance of doubt, the failure to pay trade payables as a result of insufficient cash flow from the Property shall not trigger liability under this Section 9.19.
Appears in 1 contract
Recourse. (a) Subject to the qualifications herein, Lender shall not enforce Borrower’s obligation to pay the Indebtedness by any action or proceeding wherein a deficiency judgment or other judgment establishing personal liability shall be sought against Borrower or any of its affiliates, or any Exculpated Person, except for (1) foreclosure actions or any other appropriate actions or proceedings against Borrower in order to fully exercise Lender’s remedies in respect of, and to realize upon, the Collateral, and except for (2) any actions to enforce any obligations expressly assumed or guaranteed by any guarantor, indemnitor or similar party (whether or not such party is an Exculpated Person) under the Loan Documents; provided however such foreclosure or appropriate , and (3) actions or proceedings against Borrower shall, in no event, seek to enforce Borrower’s obligation to pay the Indebtedness or other personal judgments against Borrowerrespect of its indemnity under Section 8.19(b).
(b) Borrower shall indemnify Lender and hold Lender harmless from and against any and all Damages to Lender (including the legal and other expenses of enforcing the obligations of Borrower under this Section Section, Pledgor under the Pledge Agreement and Sponsor under the Guaranty) resulting from or arising out of any of the following:
(i) any intentional or grossly negligent physical Waste at the any Property committed or permitted by Borrower▇▇▇▇▇▇▇▇, Pledgor, Sponsor or any affiliate Controlled by Borrower and/or Sponsorof their respective affiliates, which Waste is not a result of insufficient cash flow from the Property after the payment of debt service with respect to the Loan and the funding of reserves required pursuant to the Loan Documents;
(ii) any fraud or intentional material misrepresentation in connection with the Loan committed by Borrower▇▇▇▇▇▇▇▇, Pledgor, Sponsor or any affiliate Controlled by Borrower and/or Sponsorof their respective affiliates;
(iii) any willful misconduct by Borrower▇▇▇▇▇▇▇▇, Pledgor, Sponsor or any affiliate Controlled by Borrower and/or Sponsor of their respective affiliates (including (1) any litigation or other legal proceeding initiated by such Person in bad faith interference by Borrowerthat delays, Sponsor opposes, impedes, obstructs, hinders, enjoins or any affiliate Controlled by Borrower and/or Sponsor otherwise interferes with or frustrates the efforts of Lender to exercise any rights and remedies available to Lender as provided herein and in the other Loan Documents during the continuance of an Event of DefaultDefault (including, for the avoidance of doubt, alleging that the Pledge Agreement and/or any of the other Loan Documents are invalid or unenforceable as a result of Lender also being the beneficiary under the Mortgage), (2) any refusal by Borrower to comply with Section 5.9 hereof and (3) entering into, amending, modifying or terminating the Condominium Documents or any Material Agreement in violation of this Agreement or any other Loan Document);
(iv) the any misappropriation or misapplication by Borrower, Pledgor, Sponsor or any affiliate Controlled by Borrower and/or Sponsor of their respective affiliates of any funds in violation of the Loan Documents (including misappropriation or misapplication of Revenues, security deposits and/or Loss Proceeds)) not maintained in accordance with applicable Legal Requirements or not delivered to Lender upon the occurrence of an Event of Default;
(v) any voluntary Debt incurred by Borrower if Debt, Lien or Transfer of Collateral in violation of the Loan Documents that does not trigger full recourse under clauses (A) or (B) below and to the extent the continued existence of such Debt is prohibited hereunderwhich are not bonded over with an acceptable title company;
(vi) any material breach by Borrower, Pledgor or Sponsor of any representation or covenant regarding environmental matters contained in this Agreement or in the Environmental Indemnity;
(vii) any failure to pay for or maintain the Policies or pay the amount of any deductible required thereunder following a Casualty or other insurance claim, provided that current cash flow is sufficient and available pursuant to the Approved Management Agreement for payment of same and provided Lender permits cash flow from the Property Properties to be applied for such purposepurpose and the same is sufficient to pay applicable insurance deductibles;
(viiviii) the any failure of Borrower a Required SPE to be, and to at all times have been, a Single-Purpose Entity, regardless of whether such failure to have been a Single-Purpose Entity prior to the date hereof has been disclosed to Lender, and including any and all liabilities, contingent or otherwise, arising from or related to (x) the actions, conduct and/or operating history of Borrower (or any Person merged into Borrower) prior to the Closing Date and (y) Borrower’s ownership (or the ownership of any Person merged into Borrower) of assets prior to the Closing Date that do not constitute a portion of the Collateral;
(viii) removal of personal property by Borrower from the Property outside of the ordinary course of business during the continuance of an Event of Default in violation of the Loan Agreement, unless replaced with personal property of the same utility and of the same or greater value and utility; and
(ix) any fees or commissions paid by Borrower to any affiliate in violation of the terms Loan Documents;
(x) any involuntary bankruptcy of any Required SPE, provided that for this purpose “Damages” shall be limited to the amount by which such costs and expenses exceed the costs and expenses Lender would have incurred in uncontested foreclosures on the Properties;
(xi) any transfer taxes resulting from ▇▇▇▇▇▇’s exercise of remedies following an Event of Default;
(xii) any opposition by ▇▇▇▇▇▇▇▇, Pledgor or Sponsor to any motion filed by Lender for relief from the automatic stay in any bankruptcy proceeding of Borrower or Pledgor;
(A) any obligation of a Borrower Related Party to indemnify any Person that, immediately prior to any acquisition of title to the Pledged Collateral pursuant to a UCC foreclosure sale, a UCC strict foreclosure, an assignment in lieu of foreclosure or other enforcement action under the Loan Documents (collectively, an “Equity Collateral Enforcement Action”; and the date on which an Equity Collateral Enforcement Action is consummated, an “Equity Collateral Transfer Date”), was an affiliate of any Borrower Related Party, to the extent such obligation continues to be the obligation of the transferee at such Equity Collateral Enforcement Action and is not expressly waived in writing by the Persons covered by such indemnification obligation and (B) any obligation of any Borrower Related Party accruing prior to, on or after the Equity Collateral Transfer Date to pay (1) legal fees to legal counsel engaged by any Borrower Related Party prior to the Equity Collateral Transfer Date, (2) amounts due under any contract between any Borrower Related Party, on the one hand, and any affiliate of any Borrower Related Party, on the other hand (unless such contract is assumed in writing by the Person acquiring the Collateral on or after the Equity Collateral Transfer Date) or (3) amounts due under any contract between any Borrower Related Party, on the one hand, and any Person not affiliated with any Borrower Related Party, on the other hand, that has been entered into without the prior written approval of Lender to the extent such prior written approval was required under the Loan DocumentsDocuments (unless such contract was assumed in writing by the Person acquiring the Collateral on or after the Equity Collateral Transfer Date) and/or following the completion of any Equity Collateral Enforcement Action, any accounts payable of any Borrower Related Party or any income tax or indemnity liability of any Borrower Related Party to third parties or to other Borrower Related Parties; provided, that for purposes of this clause (xiii) only, the term “Borrower Related Party” shall be limited to Borrower, any Guarantor, Pledgor or any affiliate of any of them;
(xiv) any party claiming rights under the Watergate Affiliate Loan that are not subject to the Watergate Affiliate Loan Subordination Agreement; and
(xv) if Borrower shall opt out of Article 8 of the UCC or cause the Pledged Collateral not to be treated as “securities” governed by and within the meaning of Article 8, or if Borrower or any affiliate of Borrower causes Borrower to amend or otherwise modify its organizational documents in order to amend or repeal its election to be governed by Article 8 of the UCC, or Borrower or any affiliate of Borrower causes any termination or cancellation of the limited liability company membership certificate evidencing Pledgor’s one hundred percent (100%) ownership interest in Borrower, as delivered to Lender on the Closing Date in connection with the Pledge Agreement. In addition to the foregoing, the Loan Indebtedness shall be fully recourse to Borrower Borrower, Pledgor and Sponsor, jointly and severally, if in the event of:
(iA) there is any unauthorized voluntary Transfer of the title to all or any portion of any Property or any other Collateral (including voluntary Liens and encumbrances on the Collateral other than Permitted Encumbrances) of direct or Prohibited Change of Control indirect equity interests in Borrower or Prohibited Pledge, in each case, Pledgor in violation of the Loan Documents, ,
(iiB) any voluntary Debt in the nature of mortgage or mezzanine debt, in each case in violation of the Loan Documents,
(C) the filing by any Required SPE of any voluntary petition for bankruptcy, insolvency, dissolution or liquidation under pursuant to the Bankruptcy Code or any similar federal or state law is filed by, consented to, (or acquiesced in by, the filing of any involuntary petition if Borrower, (iii) Borrower Pledgor, Sponsor or any of its their respective affiliates (including Sponsor) shall have colluded with with, solicited, caused to be solicited or joined other creditors to cause an involuntary filing under the Bankruptcy Code or similar federal or state law with respect to Borrowerin such filing), or Borrower shall have terminated one or more of the Independent Directors for the purpose of facilitating a bankruptcy filing, or or
(ivD) Borrower fails any Required SPE failing to be, and to at all times have been, a Single-Purpose Entity, which failure results in a substantive consolidation of Borrower or Pledgor with any affiliate in a bankruptcy or similar proceeding. All of Borrower’s liabilities under this Section 9.19(bSection 8.19(b) shall be guaranteed by Sponsor pursuant to the Guaranty.
(c) The foregoing limitations on personal liability shall in no way impair or constitute a waiver of the validity of the Notes, the Indebtedness secured by the Collateral, or the Liens on the Collateral, or the right of Lender, as mortgagee or secured party, to foreclose and/or enforce its rights with respect to the Collateral after an Event of Default. Nothing in this Agreement shall be deemed to be a waiver of any right which Lender may have under the Bankruptcy Code to file a claim for the full amount of the debt owing to Lender by Borrower or to require that all Collateral shall continue to secure all of the Indebtedness owing to Lender in accordance with the Loan Documents. Lender may seek a judgment on the Note (and, if necessary, name Borrower in such suit) as part of judicial proceedings to foreclose on any Collateral or as a prerequisite to any such foreclosure or to confirm any foreclosure or sale pursuant to power of sale thereunder, and in the event any suit is brought on the Note(s)Notes, or with respect to any Indebtedness or any judgment rendered in such judicial proceedings, such judgment shall constitute a Lien on and may be enforced on and against the Collateral and the rents, profits, issues, products and proceeds thereof. Nothing in this Agreement shall impair the right of Lender to accelerate the maturity of the Note during upon the continuance occurrence of an Event of Default in accordance with the Loan DocumentsDefault, nor shall anything in this Agreement impair or be construed to impair the right of Lender to seek personal judgments, and to enforce all rights and remedies under applicable law, jointly and severally against any indemnitors and guarantors to the extent allowed by any applicable Loan Documents. The provisions set forth in this Section are not intended as a release or discharge of the obligations due under the Note or under any Loan Documents, but are intended as a limitation, to the extent provided in this Section, on Lender▇▇▇▇▇▇’s right to ▇▇▇ sue for a deficiency or seek a personal judgment except as required in order to realize on the Collateral.
(d) For the avoidance of doubt, the failure to pay trade payables as a result of insufficient cash flow from the Property shall not trigger liability under this Section 9.19.
Appears in 1 contract
Sources: Loan Agreement (Elme Communities)
Recourse. (a) Subject Except for any indemnification by Borrower under this Agreement or any of the other Loan Documents, the Loan shall not be recourse to Borrower and, subject to Section 9.19(c), Lender’s recourse shall be solely to the qualifications hereinProperty and the Collateral, Lender shall not enforce Borrower’s obligation to pay the Indebtedness by any action or proceeding wherein a deficiency judgment or other judgment establishing personal liability except as set forth below. In addition, no recourse shall be sought had for the Loan against any other Person, including any affiliate of Borrower or any officer, director, partner or equityholder of its affiliates, Borrower or any Exculpated Personsuch affiliate, except for foreclosure actions or any other appropriate actions or proceedings against Borrower unless expressly set forth in order to fully exercise Lender’s remedies in respect of, and to realize upon, the Collateral, and except for any actions to enforce any obligations expressly assumed or guaranteed by any guarantor, indemnitor or similar party (whether or not such party is an Exculpated Person) under the a Loan Documents; provided however such foreclosure or appropriate actions or proceedings against Borrower shall, in no event, seek to enforce Borrower’s obligation to pay the Indebtedness Document or other personal judgments against Borrowerwritten agreement to which such Person is a party.
(b) Borrower shall indemnify Lender and hold Lender harmless from and against any and all Damages to Lender (including the legal and other expenses of enforcing the obligations of Borrower under this Section 9.19 and the Sponsor under the Guaranty) resulting from or arising out of any of the followingfollowing (the “Indemnified Liabilities”), which Indemnified Liabilities shall be guaranteed by Sponsor pursuant to the Guaranty:
(i) any intentional or grossly negligent physical Waste at with respect to the Property or FF&E committed or permitted by Borrower, Operating Lessee, the Sponsor or any affiliate Controlled by Borrower and/or Sponsorof their respective affiliates;
(ii) any fraud or intentional misrepresentation in connection with the Loan committed by Borrower, Operating Lessee, the Sponsor or any affiliate Controlled by Borrower and/or Sponsorof their respective affiliates;
(iii) any willful misconduct by Borrower, Operating Lessee, the Sponsor or any affiliate Controlled by Borrower and/or Sponsor of their respective affiliates in violation of the Loan Documents (including any bad faith wrongful interference by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor such Person with the exercise any rights and of remedies available to by Lender as provided herein and in the other Loan Documents during the continuance of an Event of Default);
(iv) the misappropriation or misapplication by Borrower, Operating Lessee, the Sponsor or any affiliate Controlled by Borrower and/or Sponsor of their respective affiliates of any funds in violation of the Loan Documents (including misappropriation or misapplication of Revenues, security deposits and/or Loss ProceedsProceeds and the violation of the last sentence of Section 5.7(d));
(v) any voluntary Debt incurred by Borrower prohibited hereunder, provided that, for the purpose of this clause (v), Debt will be regarded as voluntary if and to the extent the continued existence of such Debt is prohibited hereunderincurred voluntarily or incurred involuntarily and not repaid despite the availability of sufficient cash flow from the Property;
(vi) any breach by Borrower, Operating Lessee or the Sponsor of any representation or covenant regarding environmental matters contained in this Agreement or in the Environmental Indemnity;
(vii) the failure to pay or maintain the Policies or pay the amount of any deductible required thereunder following a Casualty or other insurance claim, provided that current cash flow is sufficient and available pursuant to the Approved Management Agreement for payment of same and provided Lender permits cash flow from the Property to be applied for such purpose;
(viiviii) the failure of Borrower or Operating Lessee to be, and to at all times have been, a Single-Purpose Entity;
(ix) removal of personal property or FF&E from the Property during or in anticipation of an Event of Default, regardless unless replaced with personal property or FF&E, as applicable, of whether such failure the same utility and of the same or greater value and utility;
(x) any fees or commissions paid by Borrower or Operating Lessee to have been a Single-Purpose Entity prior any affiliate in violation of the terms of the Loan Documents;
(xi) any bankruptcy of Borrower or Operating Lessee, provided that, for the purpose of this clause (xi) “Damages” shall be limited to the date hereof has been disclosed amount by which such costs and expenses exceed the costs and expenses Lender would have incurred in an uncontested foreclosure on the Property (for the avoidance of doubt, the recourse described in this clause shall be in addition to Lender, and including the full recourse for bankruptcy described below);
(xii) the failure of Borrower to maintain the required account balance in the Borrower FF&E Account (it being agreed that Damages in such event shall include the amount of any funds not deposited to the Borrower FF&E Account); and
(xiii) any and all liabilities, contingent or otherwise, arising from or related to (x) the actions, conduct and/or operating history of Borrower (or any Person merged into Borrower) prior to the Closing Date and (y) Borrower’s ownership (or the ownership of any Person merged into Borrower) of assets prior to the Closing Date that do not constitute a portion of the Collateral;
(viii) removal of personal property by Borrower from the Property outside of the ordinary course of business during the continuance of an Event of Default in violation of the Loan Agreement, unless replaced with personal property of the same utility and of the same or greater value and utility; and
(ixxiv) any fees or commissions paid breach by Borrower to or Operating Lessee of any affiliate representation or covenant contained in violation the Subordination of the terms of the Loan DocumentsOperating Lease. In addition to the foregoing, the Loan shall be fully recourse to Borrower and Sponsor, jointly and severally, if upon (i) there is any unauthorized Transfer of the Property or Property, unauthorized transfer of any other of the Collateral (including voluntary unauthorized Liens and encumbrances on the Collateral other than Permitted EncumbrancesCollateral) or Prohibited Change of Control or Prohibited PledgeControl, in each case, in violation of the Loan Documents, (ii) the occurrence of any petition for bankruptcy, insolvency, dissolution filing by Borrower or liquidation Operating Lessee under the Bankruptcy Code or any similar federal joining or state law is filed by, consented to, or acquiesced in by, colluding by Borrower, (iii) Borrower Operating Lessee or any of its their respective affiliates (including Sponsor) shall have colluded with other creditors to cause in the filing of an involuntary filing case in respect of Borrower or Operating Lessee under the Bankruptcy Code (provided, however, that if such involuntary case is dismissed within 60 days of such filing the Loan shall not be fully recourse to Borrower and Sponsor, however Borrower and Sponsor shall indemnify Lender and hold Lender harmless from and against any and all Damages to Lender arising from or similar federal or state law with respect related to Borrower, or Borrower shall have terminated one or more the filing of the Independent Directors for the purpose of facilitating a bankruptcy filing, such involuntary case) or (iviii) the failure of Borrower fails to be, and to at all times have been, a Single-Purpose Entity, which failure results in a substantive consolidation of Borrower with any affiliate in a bankruptcy or similar proceedingproceeding (or the filing of a motion for substantive consolidation in bankruptcy citing any such failure, provided, however, that if such motion is dismissed within 60 days of filing the Loan shall not be fully recourse to Borrower and Sponsor, however Borrower and Sponsor shall indemnify Lender and hold Lender harmless from and against any and all Damages to Lender arising from or related to such motion). All of Borrower’s liabilities under this Section 9.19(b) The Loan shall be guaranteed by fully recourse to Sponsor pursuant in an amount equal to its unpaid Guaranteed Obligations (as such term is defined in the Completion Guaranty) under the Completion Guaranty.
(c) The foregoing limitations on personal liability shall in no way impair or constitute a waiver of the validity of the Notes, the Indebtedness secured by the Collateral, or the Liens on the Collateral, or the right of Lender, as mortgagee or secured party, to foreclose and/or enforce its rights with respect to the Collateral after an Event of Default. Nothing in this Agreement shall be deemed to be a waiver of any right which Lender may have under the Bankruptcy Code to file a claim for the full amount of the debt owing to Lender by Borrower or to require that all Collateral shall continue to secure all of the Indebtedness owing to Lender in accordance with the Loan Documents. Lender may seek a judgment on the Note (and, if necessary, name Borrower in such suit) as part of judicial proceedings to foreclose on under the Mortgage or to foreclose pursuant to any Collateral other Loan Documents, or as a prerequisite to any such foreclosure or to confirm any foreclosure or sale pursuant to power of sale thereunder, and in the event any suit is brought on the Note(s)Notes, or with respect to any Indebtedness or any judgment rendered in such judicial proceedings, such judgment shall constitute a Lien on and may will be and can be enforced on and against the Collateral and the rents, profits, issues, products and proceeds thereof. Nothing in this Agreement shall impair the right of Lender to accelerate the maturity of the Note during upon the continuance occurrence of an Event of Default in accordance with the Loan DocumentsDefault, nor shall anything in this Agreement impair or be construed to impair the right of Lender to seek personal judgments, and to enforce all rights and remedies under applicable law, jointly and severally against any indemnitors and guarantors to the extent allowed by any applicable Loan Documentsguarantees. The provisions set forth in this Section 9.19 are not intended as a release or discharge of the obligations due under the Note or under any Loan Documents, but are intended as a limitation, to the extent provided in this Section, on Lender’s right to ▇▇▇ for a deficiency or seek a personal judgment against Borrower or Sponsor except as required in order to realize on the Collateral.
(d) For the avoidance of doubt, the failure to pay trade payables as a result of insufficient cash flow from the Property shall not trigger liability under this Section 9.19.
Appears in 1 contract
Recourse. (a) Subject to the qualifications herein, Lender shall not enforce Borrower’s obligation to pay the Indebtedness Except for any indemnification by any action or proceeding wherein a deficiency judgment or other judgment establishing personal liability shall be sought against Borrower under this Agreement or any of its affiliatesthe other Loan Documents, or the Indebtedness shall not be recourse to Borrower. In addition, no recourse shall be had for the Indebtedness against any Exculpated other Person, except for foreclosure actions including any affiliate or officer, director, partner, equityholder (whether direct or indirect), employee or agent of Borrower (other than Sponsor), Sponsor or any other appropriate actions or proceedings against Borrower Person, unless expressly set forth in order to fully exercise Lender’s remedies in respect of, and to realize upon, the Collateral, and except for any actions to enforce any obligations expressly assumed or guaranteed by any guarantor, indemnitor or similar party (whether or not such party is an Exculpated Person) under the a Loan Documents; provided however such foreclosure or appropriate actions or proceedings against Borrower shall, in no event, seek to enforce Borrower’s obligation to pay the Indebtedness or other personal judgments against BorrowerDocument.
(b) Borrower shall indemnify Lender and hold Lender harmless from and against any and all Damages to actually incurred by Lender (including the legal and other expenses of enforcing the obligations of Borrower under this Section 9.19 and Sponsor under the Guaranty) resulting from or arising out of any of the following:following (the “Indemnified Liabilities”) (but subject to the last paragraph of this Section 9.19(b)), which Indemnified Liabilities shall be guaranteed by Sponsor pursuant to the Guaranty (subject to the provisions of the Guaranty):
(i) any intentional physical Waste at the with respect to any Property committed or permitted by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsorof their respective affiliates;
(ii) any fraud or intentional misrepresentation in connection with relating to the Loan committed by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsorof their respective affiliates;
(iii) any willful misconduct by Borrower, the Sponsor or any affiliate Controlled by Borrower and/or Sponsor of their respective affiliates in connection with the Loan in violation of the Loan Documents (including any bad faith wrongful interference by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor such Person with the exercise any rights and of remedies available to by Lender as provided herein and in the other Loan Documents during the continuance of an Event of Default);
(iv) the misappropriation or misapplication by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor of their respective affiliates of any funds in violation of the Loan Documents (including misappropriation or misapplication of Revenues, security deposits (including any violation of the last sentence of Section 5.7(d)) and/or Loss Proceeds);
(v) any voluntary Debt incurred by Borrower (other than mechanic’s liens that are Permitted Encumbrances) if and to the extent the continued existence of such Debt is prohibited hereunderhereunder (for these purposes, Debt will be regarded as voluntary if either (a) incurred voluntarily, or (b) incurred involuntarily but subsequently not repaid despite the availability of sufficient cash flow from the Properties) subject, in the case of involuntarily incurred Debt, to Borrower’ right to contest the same pursuant to Section 6.4);
(vi) the failure to pay or maintain the Policies or pay the amount of any deductible required thereunder following a Casualty or other insurance claim, provided that current cash flow is sufficient and available pursuant to the Approved Management Agreement for payment of same and provided Lender permits cash flow from the Property to be applied for such purpose;
(vii) the failure of Borrower to be, and to at all times have been, a Single-Purpose Entity, regardless of whether such failure to have been a Single-Purpose Entity prior to the date hereof has been disclosed to Lender, and including any and all liabilities, contingent or otherwise, arising from or related to (x) the actions, conduct and/or operating history of Borrower (or any Person merged into Borrower) prior to the Closing Date and (y) Borrower’s ownership (or the ownership of any Person merged into Borrower) of assets prior to the Closing Date that do not constitute a portion of the Collateral;
(viii) removal of personal property by Borrower from the Property outside of the ordinary course of business during the continuance of an Event of Default in violation of the Loan Agreement, unless replaced with personal property of the same utility and of the same or greater value and utility; and
(ix) any fees or commissions paid by Borrower to any affiliate in violation of the terms of the Loan Documents. In addition to the foregoing, the Loan shall be fully recourse to Borrower and Sponsor, jointly and severally, if (i) there is any unauthorized Transfer of the Property or any other Collateral (including voluntary Liens and encumbrances on the Collateral other than Permitted Encumbrances) or Prohibited Change of Control or Prohibited Pledge, in each case, in violation of the Loan Documents, (ii) any petition for bankruptcy, insolvency, dissolution or liquidation under the Bankruptcy Code or any similar federal or state law is filed by, consented to, or acquiesced in by, Borrower, (iii) Borrower or any of its affiliates (including Sponsor) shall have colluded with other creditors to cause an involuntary filing under the Bankruptcy Code or similar federal or state law with respect to Borrower, or Borrower shall have terminated one or more of the Independent Directors for the purpose of facilitating a bankruptcy filing, or (iv) Borrower fails to be, and to at all times have been, a Single-Purpose Entity, which failure results in a substantive consolidation of Borrower with any affiliate of Borrower (other than another Borrower) in a bankruptcy or similar proceedingproceeding (or the filing by Borrower or any affiliate of Borrower of a motion to substantively consolidate Borrower with any affiliate of Borrower (other than another Borrower));
(vii) with respect to each Borrower that is a so-called “recycled entity”, the failure of such Borrower to have been, in any material respect, a Single-Purpose Entity since its formation to the extent relating to the operating history of such Borrower prior to the Closing Date and/or the ownership of assets by such Borrower (other than any such assets that constitute Collateral) prior to the Closing Date;
(viii) removal of personal property from any Property during an Event of Default, unless replaced with personal property of the same utility and of the same or greater value and utility;
(ix) any Transfer of any portion of the Property that constitutes real property in violation of the Loan Documents (other than a Mortgage Foreclosure) and/or any Prohibited Change of Control; and
(x) any voluntary action by Borrower or any affiliate of Borrower to create or cause a Lien on the Property (other than a Permitted Encumbrance). All of Borrower’s liabilities under this Section 9.19(bIn addition to the foregoing, (i) the Unfunded Obligation Amounts shall be guaranteed fully recourse to Borrower and Sponsor, jointly and severally, pursuant to, and subject to the provisions of, Section 3.8(b) and the Guaranty and (ii) the Loan shall be fully recourse to Borrower and Sponsor (pursuant to, and subject to the provisions of, the Guaranty), jointly and severally, upon the occurrence of any filing by Borrower under the Bankruptcy Code or any joining or colluding by Borrower or any of its affiliates (including Sponsor) in the filing of an involuntary case in respect of Borrower under the Bankruptcy Code; provided, however, that the liability of Sponsor pursuant to this sentence shall not exceed, in the aggregate, an amount equal to 25% of the then-outstanding Principal Indebtedness. For the avoidance of doubt, the liabilities described in the immediately preceding sentence are included in the definition of “Indemnified Liabilities”. Notwithstanding anything to the contrary in this Section 9.19 or otherwise in any Loan Document, in no event shall Indemnified Liabilities or the Guaranteed Obligations (as defined in the Guaranty) include Damages or other liabilities arising as a result of the actions or omissions of (i) any Person other than (A) Borrower or any other Person that is controlled by Sponsor or any affiliate of Sponsor or (B) a Person to whom direct or indirect equity interests in Borrower have been transferred in violation of the Loan Documents, (ii) Lender, any lender of a Mezzanine Loan or their respective designees or (iii) from and after the completion of a Mezzanine Foreclosure, Borrower or any borrower under a Mezzanine Loan.
(c) The foregoing limitations on personal liability shall in no way impair or constitute a waiver of the validity of the Notes, the Indebtedness secured by the Collateral, or the Liens on the Collateral, or the right of Lender, as mortgagee or secured party, to foreclose and/or enforce its rights with respect to the Collateral after an Event of Default. Nothing in this Agreement shall be deemed to be a waiver of any right which Lender may have under the Bankruptcy Code to file a claim for the full amount of the debt owing to Lender by Borrower or to require that all Collateral shall continue to secure all of the Indebtedness owing to Lender in accordance with the Loan Documents. Lender may seek a judgment on the Note (and, if necessary, name Borrower in such suit) as part of judicial proceedings to foreclose on under the Mortgage or to foreclose pursuant to any Collateral other Loan Documents, or as a prerequisite to any such foreclosure or to confirm any foreclosure or sale pursuant to power of sale thereunder, and in the event any suit is brought on the Note(s)Notes, or with respect to any Indebtedness or any judgment rendered in such judicial proceedings, such judgment shall constitute a Lien on and may will be and can be enforced on and against the Collateral and the rents, profits, issues, products and proceeds thereof. Nothing in this Agreement shall impair the right of Lender to accelerate the maturity of the Note during upon the continuance occurrence of an Event of Default in accordance with the Loan DocumentsDefault, nor shall anything in this Agreement impair or be construed to impair the right of Lender to seek personal judgments, and to enforce all rights and remedies under applicable law, jointly and severally against any indemnitors and guarantors to the extent allowed by any applicable Loan Documentsguarantees (including any right to seek personal judgment against any such guarantors pursuant to and in accordance with the terms of any such guarantees). The provisions set forth in this Section 9.19 are not intended as a release or discharge of the obligations due under the Note or under any Loan Documents, but are intended as a limitation, to the extent provided in this Section, on Lender’s right to ▇▇▇ for a deficiency or seek a personal judgment except as required in order to realize on the Collateralagainst Borrower or Sponsor.
(d) For the avoidance of doubt, the failure to pay trade payables as a result of insufficient cash flow from the Property shall not trigger liability under this Section 9.19.
Appears in 1 contract
Recourse. (a) The Loan shall be full recourse to Parent Borrower. Further, Administrative Agent and the Lenders shall have the right to (a) proceed against Parent Borrower or any Guarantor under the Environmental Indemnity, or to proceed against any Guarantor under the Guaranty, (b) name Parent Borrower or any Guarantor in any foreclosure or similar legal action to the extent necessary to enforce Administrative Agent and the Lenders’ rights under the Loan Documents, and/or (c) obtain injunctive relief against Parent Borrower, any Guarantor, any Affiliate or other Person, or maintain any suit or action in connection with the preservation, enforcement or foreclosure of any Lien now or hereafter securing any indebtedness or obligations of Parent Borrower under this Agreement or the other Loan Documents. Notwithstanding the foregoing, neither Administrative Agent nor Lender shall take any action against GSI Guarantor until Administrative Agent or Lender, as applicable, pursues its rights and remedies against Borrower for no less than 120 days after the occurrence of the applicable Event of Default. For certainty, the remainder of this Section 11.1 below shall not apply to Parent Borrower.
(b) Subject to the qualifications hereinbelow, neither Administrative Agent nor any Lender shall not enforce Borrower’s the liability and obligation of Property-Owning Borrower to pay perform and observe the Indebtedness obligations contained in the Loan Documents by any action or proceeding wherein a deficiency money judgment or other judgment establishing personal liability shall be sought against Borrower or any of its affiliates, or any Exculpated PersonProperty-Owning Borrower, except that Administrative Agent may bring a foreclosure action, an action for foreclosure actions specific performance or any other appropriate actions action or proceedings against Borrower in order proceeding to fully exercise Lender’s remedies in respect of, enable Administrative Agent and to realize upon, the Collateral, and except for any actions Lenders to enforce any obligations expressly assumed or guaranteed by any guarantor, indemnitor or similar party (whether or not such party is an Exculpated Person) and realize upon its interest and rights under the Loan Documents, or in the Property, the Rents or any other collateral given to Lenders pursuant to the Loan Documents; provided, however, that, except as specifically provided however herein, any judgment in any such foreclosure action or appropriate actions or proceedings proceeding shall be enforceable against Property-Owning Borrower shallonly to the extent of Property-Owning Borrower’s interest in the Property, in no eventthe Rents and in any other collateral given to Lenders, and neither Administrative Agent nor any Lender shall sue for, seek to enforce Borrower’s obligation to pay the Indebtedness or other personal judgments demand any deficiency judgment against Borrower.
(b) Property-Owning Borrower shall indemnify Lender and hold Lender harmless from and against in any and all Damages to Lender (including the legal and other expenses such action or proceeding under or by reason of enforcing the obligations or under or in connection with any Loan Document. The provisions of Borrower under this Section and Sponsor under the Guaranty11.1(b) resulting from or arising out of any of the following:
shall not, however, (i) constitute a waiver, release or impairment of any intentional physical Waste at the Property committed obligation evidenced or permitted secured by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor;
Loan Document; (ii) any fraud or intentional misrepresentation in connection with the Loan committed by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor;
(iii) any willful misconduct by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor (including any bad faith interference by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor with the exercise any rights and remedies available to Lender as provided herein and in the other Loan Documents during the continuance of an Event of Default);
(iv) the misappropriation or misapplication by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor of any funds in violation of the Loan Documents (including misappropriation or misapplication of Revenues, security deposits and/or Loss Proceeds);
(v) any voluntary Debt incurred by Borrower if and to the extent the continued existence of such Debt is prohibited hereunder;
(vi) the failure to pay or maintain the Policies or pay the amount of any deductible required thereunder following a Casualty or other insurance claim, provided that current cash flow is sufficient and available pursuant to the Approved Management Agreement for payment of same and provided Lender permits cash flow from the Property to be applied for such purpose;
(vii) the failure of Borrower to be, and to at all times have been, a Single-Purpose Entity, regardless of whether such failure to have been a Single-Purpose Entity prior to the date hereof has been disclosed to Lender, and including any and all liabilities, contingent or otherwise, arising from or related to (x) the actions, conduct and/or operating history of Borrower (or any Person merged into Borrower) prior to the Closing Date and (y) Borrower’s ownership (or the ownership of any Person merged into Borrower) of assets prior to the Closing Date that do not constitute a portion of the Collateral;
(viii) removal of personal property by Borrower from the Property outside of the ordinary course of business during the continuance of an Event of Default in violation of the Loan Agreement, unless replaced with personal property of the same utility and of the same or greater value and utility; and
(ix) any fees or commissions paid by Borrower to any affiliate in violation of the terms of the Loan Documents. In addition to the foregoing, the Loan shall be fully recourse to Borrower and Sponsor, jointly and severally, if (i) there is any unauthorized Transfer of the Property or any other Collateral (including voluntary Liens and encumbrances on the Collateral other than Permitted Encumbrances) or Prohibited Change of Control or Prohibited Pledge, in each case, in violation of the Loan Documents, (ii) any petition for bankruptcy, insolvency, dissolution or liquidation under the Bankruptcy Code or any similar federal or state law is filed by, consented to, or acquiesced in by, Borrower, (iii) Borrower or any of its affiliates (including Sponsor) shall have colluded with other creditors to cause an involuntary filing under the Bankruptcy Code or similar federal or state law with respect to Borrower, or Borrower shall have terminated one or more of the Independent Directors for the purpose of facilitating a bankruptcy filing, or (iv) Borrower fails to be, and to at all times have been, a Single-Purpose Entity, which failure results in a substantive consolidation of Borrower with any affiliate in a bankruptcy or similar proceeding. All of Borrower’s liabilities under this Section 9.19(b) shall be guaranteed by Sponsor pursuant to the Guaranty.
(c) The foregoing limitations on personal liability shall in no way impair or constitute a waiver of the validity of the Notes, the Indebtedness secured by the Collateral, or the Liens on the Collateral, or the right of Lender, as mortgagee or secured party, to foreclose and/or enforce its rights with respect to the Collateral after an Event of Default. Nothing in this Agreement shall be deemed to be a waiver of any right which Lender may have under the Bankruptcy Code to file a claim for the full amount of the debt owing to Lender by Borrower or to require that all Collateral shall continue to secure all of the Indebtedness owing to Lender in accordance with the Loan Documents. Lender may seek a judgment on the Note (and, if necessary, name Borrower in such suit) as part of judicial proceedings to foreclose on any Collateral or as a prerequisite to any such foreclosure or to confirm any foreclosure or sale pursuant to power of sale thereunder, and in the event any suit is brought on the Note(s), or with respect to any Indebtedness or any judgment rendered in such judicial proceedings, such judgment shall constitute a Lien on and may be enforced on and against the Collateral and the rents, profits, issues, products and proceeds thereof. Nothing in this Agreement shall impair the right of Administrative Agent or any Lender to accelerate the maturity of the Note during the continuance of an Event of Default in accordance with the Loan Documents, nor shall anything in this Agreement impair or be construed to impair the right of Lender to seek personal judgments, and to enforce all rights and remedies under applicable law, jointly and severally against any indemnitors and guarantors to the extent allowed by any applicable Loan Documents. The provisions set forth in this Section are not intended name Property-Owning Borrower as a release party defendant in any action or discharge of the obligations due suit for foreclosure and sale under the Note or under any Loan Documents, but are intended as a limitation, to the extent provided in this Section, on Lender’s right to ▇▇▇ for a deficiency or seek a personal judgment except as required in order to realize on the Collateral.
Mortgage; (diii) For the avoidance of doubt, the failure to pay trade payables as a result of insufficient cash flow from the Property shall not trigger liability under this Section 9.19.affect the
Appears in 1 contract
Sources: Loan Agreement (Greystone Housing Impact Investors LP)
Recourse. (a) Subject to the qualifications herein, Lender shall not enforce Borrower’s obligation to pay the Indebtedness by any action or proceeding wherein a deficiency judgment or other judgment establishing personal liability shall be sought against Borrower or any of its affiliates, or any Exculpated Person, except for foreclosure actions or any other appropriate actions or proceedings against Borrower in order to fully exercise Lender’s remedies in respect of, and to realize upon, the Collateral, and except for any actions to enforce any obligations expressly assumed or guaranteed by any guarantor, indemnitor or similar party (whether or not such party is an Exculpated Person) under the Loan Documents; provided however such foreclosure or appropriate actions or proceedings against Borrower shall, in no event, seek to enforce Borrower’s obligation to pay the Indebtedness or other personal judgments against Borrower.
(b) Borrower (but not any Exculpated Person, except Sponsor) shall indemnify Lender and hold Lender harmless from and against any and all Damages to Lender (including the legal and other expenses of enforcing the obligations of Borrower under this Section and the Sponsor under the Guaranty) resulting from or arising out of any of the followingfollowing (the “Indemnified Liabilities”), which Indemnified Liabilities shall be guaranteed by Sponsor pursuant to the Guaranty:
(i) any intentional or grossly negligent material physical Waste at the Property committed or permitted by Borrower, Operating Lessee, the Sponsor or any affiliate Controlled by Borrower and/or Sponsorof their respective affiliates;
(ii) any fraud or intentional willful misrepresentation in connection with the Loan committed by Borrower, Operating Lessee, the Sponsor or any affiliate Controlled by Borrower and/or Sponsorof their respective affiliates;
(iii) any willful misconduct by Borrower, Operating Lessee the Sponsor or any affiliate Controlled by Borrower and/or Sponsor of their respective affiliates (including any bad faith wrongful interference by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor such Person with the exercise any rights and of remedies available to by Lender as provided herein and in the other Loan Documents during the continuance of an Event of Default);
(iv) the misappropriation or intentional misapplication by Borrower, Operating Lessee, the Sponsor or any affiliate Controlled by Borrower and/or Sponsor of their respective affiliates of any funds in violation of the Loan Documents (Documents, including misappropriation or intentional misapplication of Revenues, security deposits deposits, Loss Proceeds (to the extent not applied toward repayment of the Loan or restoration of the Property pursuant to this Agreement) and/or Loss Proceeds)amounts contained in the Hyatt FF&E Account or Hyatt Operating Account;
(v) any voluntary Debt incurred by Borrower or Operating Lessee if and to the extent the continued existence of such Debt is prohibited hereunderhereunder (excluding , however, any Debt that constituted Permitted Debt on the date that it was incurred);
(vi) any breach by Borrower, Operating Lessee or the Sponsor of any representation or covenant regarding environmental matters contained in this Agreement or in the Environmental Indemnity;
(vii) the failure to pay or maintain the Policies or pay the amount of any deductible required thereunder following a Casualty or other insurance claim, provided that current cash flow is sufficient and available pursuant to the Approved Management Agreement for payment of same and provided Lender permits cash flow from the Property is sufficient for such purpose and Lender permits the same to be applied for such purposepurpose (and neither Borrower nor Sponsor shall have an liability under this clause (vii) for Damages that arise from Lender’s failure to properly apply amounts reserved by Lender, if any, for the purpose of paying insurance premiums);
(viiviii) the failure of Borrower or Operating Lessee to be, and to at all times have been, a Single-Purpose EntityEntity (for the avoidance of doubt, regardless of whether such failure to have been a Single-Purpose Entity prior the recourse described in this clause shall be in addition to the date hereof has been disclosed to Lenderfull recourse for a substantive consolidation described below), and including any and all liabilities, contingent or otherwise, arising from or related to (x) except for the actions, conduct and/or operating history unilateral resignation of Borrower (or any Person merged into Borrower) prior to the Closing Date and (y) Borrower’s ownership (or the ownership of any Person merged into Borrower) of assets prior to the Closing Date that do not constitute a portion of the Collateralan Independent Director;
(viiiix) removal of personal property by Borrower or FF&E from the Property outside of the ordinary course of business during the continuance or in anticipation of an Event of Default in violation Default, except as a result of the Loan Agreement, obsolescence or unless replaced with personal property of the same utility and or FF&E of the same or greater value and utility; and;
(ixx) any fees or commissions paid by Borrower or Operating Lessee to any affiliate in violation of the terms of the Loan Documents;
(xi) the failure to fund the Hyatt FF&E Account pursuant to the Hyatt Management Agreement (it being agreed that Damages in such event shall include the amount of any funds not deposited into the Hyatt FF&E Account), provided cash flow from the Property is sufficient for such purpose and Lender permits the same to be applied for such purpose; and
(xii) any unauthorized Lien on any Collateral Account, the Hyatt Operating Account or the Hyatt FF&E Account committed or consented to by Borrower, Operating Lessee, the Sponsor or any of their respective affiliates in violation of the Loan Documents. In addition to the foregoing, the Loan shall be fully recourse to Borrower and Sponsor, jointly and severally, if (i) there is any unauthorized Transfer of the Property or any other unauthorized transfer of any Collateral (including voluntary Liens and encumbrances on Account, the Collateral other than Permitted Encumbrances) Hyatt Operating Account, the Hyatt FF&E Account or any Prohibited Change of Control or Prohibited PledgeControl, in each case, in violation of the Loan Documents, (ii) any petition for bankruptcy, insolvency, dissolution or liquidation under the Bankruptcy Code or any similar federal or state law is filed by, consented to, or acquiesced in by, Borrowerany Required SPE, (iii) Borrower any Required SPE or any of its their respective affiliates (including Sponsor) shall have colluded with other creditors to cause an involuntary bankruptcy filing under the Bankruptcy Code or similar federal or state law with respect to Borrower, or Borrower shall have terminated one or more of the Independent Directors for the purpose of facilitating a bankruptcy filingany Required SPE, or (iv) Borrower any Required SPE fails to be, and to at all times have been, a Single-Purpose Entity, which failure results in a substantive consolidation of Borrower and/or Operating Lessee with any affiliate in a bankruptcy or similar proceeding. All of Borrower’s liabilities under this Section 9.19(b) The Loan shall be guaranteed by recourse to Sponsor pursuant in an amount equal to its unpaid Guaranteed Obligations (as such term is defined in the Completion Guaranty) under the Completion Guaranty.
(c) The foregoing limitations on personal liability shall in no way impair or constitute a waiver of the validity of the Notes, the Indebtedness secured by the Collateral, or the Liens on the Collateral, or the right of Lender, as mortgagee or secured party, to foreclose and/or enforce its rights with respect to the Collateral after an Event of Default. Nothing in this Agreement shall be deemed to be a waiver of any right which Lender may have under the Bankruptcy Code to file a claim for the full amount of the debt owing to Lender by Borrower or to require that all Collateral shall continue to secure all of the Indebtedness owing to Lender in accordance with the Loan Documents. Lender may seek a judgment on the Note (and, if necessary, name Borrower in such suit) as part of judicial proceedings to foreclose on any Collateral or as a prerequisite to any such foreclosure or to confirm any foreclosure or sale pursuant to power of sale thereunder, and in the event any suit is brought on the Note(s)Notes, or with respect to any Indebtedness or any judgment rendered in such judicial proceedings, such judgment shall constitute a Lien on and may be enforced on and against the Collateral and the rents, profits, issues, products and proceeds thereof. Nothing in this Agreement shall impair the right of Lender to accelerate the maturity of the Note during upon the continuance occurrence of an Event of Default in accordance with the Loan DocumentsDefault, nor shall anything in this Agreement impair or be construed to impair the right of Lender to seek personal judgments, and to enforce all rights and remedies under applicable law, jointly and severally against any indemnitors and guarantors to the extent allowed by any applicable Loan Documents. The provisions set forth in this Section are not intended as a release or discharge of the obligations due under the Note or under any Loan Documents, but are intended as a limitation, to the extent provided in this Section, on Lender’s right to ▇▇▇ for a deficiency or seek a personal judgment except as required in order to realize on the Collateral.
(d) For the avoidance of doubt, the failure to pay trade payables as a result of insufficient cash flow from the Property shall not trigger liability under this Section 9.19.
Appears in 1 contract
Recourse. (a) Subject The Junior Indebtedness shall be recourse to the qualifications hereinRKB Borrower. Recourse to the Presidents Borrower shall be limited to the Liens of Lender on the Properties and the other Collateral, Lender and recourse to RKB Holding, L.P. shall not enforce Borrower’s obligation be limited to pay its rights to distributions from the RKB Borrower as set forth in the Distributions Rights Pledge Agreement. Except as set forth in this Section 9.19(a) and Section 9.19(b), no recourse shall be had for the Indebtedness by or for the performance of any action or proceeding wherein a deficiency judgment or other judgment establishing personal liability shall be sought obligations of Borrower under the Loan Documents against Borrower or any of its Borrower, Sponsor, their affiliates, or any Exculpated Personofficer, except for foreclosure actions director, partner or equityholder of RKB Borrower or any other appropriate actions or proceedings against Borrower in order to fully exercise Lender’s remedies in respect of, and to realize upon, the Collateral, and except for any actions to enforce any obligations expressly assumed or guaranteed by any guarantor, indemnitor or similar party (whether or not such party is an Exculpated Person) under the Loan Documents; provided however such foreclosure or appropriate actions or proceedings against Borrower shall, in no event, seek to enforce Borrower’s obligation to pay the Indebtedness or other personal judgments against Borroweraffiliate.
(b) Borrower shall and Sponsor (as evidenced by Sponsor’s signature below) agree to jointly and severally indemnify Lender and hold Lender harmless from and against any and all Damages to Lender (including the legal and other expenses of enforcing the obligations of the Borrower and Sponsor under this Section and Sponsor under the Guaranty9.19) resulting from or arising out of any of the following:following (the “Indemnified Liabilities”):
(i) any intentional intentional, affirmative acts of physical Waste at with respect to the Property Properties or the RKB Properties committed or intentionally permitted by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsorof their respective affiliates;
(ii) any actual fraud or fraudulent misrepresentation (and, with respect to Presidents Sponsor but not the Individual Sponsors, any intentional misrepresentation in connection with the Loan even if not fraudulent) committed by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsorof their respective affiliates;
(iii) any willful misconduct the appropriation or application by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor (including any bad faith interference by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor with the exercise any rights and remedies available to Lender as provided herein and in the other Loan Documents during the continuance of an Event of Default);
(iv) the misappropriation or misapplication by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor their respective affiliates of any funds in violation of the Loan Documents (including misappropriation or misapplication of Revenues, Net RKB Capital Event Proceeds, RKB Excess Cash Flow, security deposits and/or Loss Proceeds);
(v) any voluntary Debt incurred by Borrower if and to the extent the continued existence of such Debt is prohibited hereunder;
(vi) the failure to pay or maintain the Policies or pay the amount of any deductible required thereunder following a Casualty or other insurance claim, provided that current cash flow is sufficient and available pursuant to the Approved Management Agreement for payment of same and provided Lender permits cash flow from the Property to be applied for such purpose;
(vii) the failure of Borrower to be, and to at all times have been, a Single-Purpose Entity, regardless of whether such failure to have been a Single-Purpose Entity prior to the date hereof has been disclosed to Lender, and including any and all liabilities, contingent or otherwise, arising from or related to (x) the actions, conduct and/or operating history of Borrower (or any Person merged into Borrower) prior to the Closing Date and (y) Borrower’s ownership (or the ownership of any Person merged into Borrower) of assets prior to the Closing Date that do not constitute a portion of the Collateral;
(viii) removal of personal property by Borrower from the Property outside of the ordinary course of business during the continuance of an Event of Default in violation of the Loan Agreement, unless replaced with personal property of the same utility and of the same or greater value and utility; and
(ix) any fees or commissions paid by Borrower to any affiliate in violation of the terms of the Loan Documents. In addition to the foregoing, the Loan shall be fully recourse to Borrower and Sponsor, jointly and severally, if (i) there is any unauthorized Transfer of the Property or any other Collateral (including voluntary Liens and encumbrances on the Collateral other than Permitted Encumbrances) or Prohibited Change of Control or Prohibited Pledge, in each case, in violation provisions of the Loan Documents, (ii) including any petition for bankruptcy, insolvency, dissolution or liquidation under the Bankruptcy Code or any similar federal or state law is filed by, consented to, or acquiesced in by, Borrower, (iii) Borrower or any of its affiliates (including Sponsor) shall have colluded with other creditors to cause an involuntary filing under the Bankruptcy Code or similar federal or state law with respect to Borrower, or Borrower shall have terminated one or more violation of the Independent Directors for last sentence of Section 5.7(d), any failure to apply Net RKB Capital Event Proceeds or the purpose proceeds of facilitating a bankruptcy filingany initial public offering toward the repayment of the Loan in accordance with Sections 1.3(d) and (e), or (iv) Borrower fails to beas applicable, and any failure of an RKB Subsidiary to at make distributions of all times have been, a Single-Purpose Entity, which failure results in a substantive consolidation of Borrower with any affiliate in a bankruptcy or similar proceeding. All of Borrower’s liabilities under this Section 9.19(b) shall be guaranteed by Sponsor pursuant RKB Excess Cash Flow to the Guaranty.
(c) The foregoing limitations on personal liability shall RKB Cash Management Account, in no way impair or constitute a waiver accordance with the Distribution Acknowledgment, after receipt from Lender of notice of the validity occurrence of the Notes, the Indebtedness secured by the Collateral, or the Liens on the Collateral, or the right of Lender, as mortgagee or secured party, to foreclose and/or enforce its rights with respect to the Collateral after an Event of Default. Nothing in this Agreement shall be deemed to be a waiver of any right which Lender may have under the Bankruptcy Code to file a claim for the full amount of the debt owing to Lender by Borrower or to require that all Collateral shall continue to secure all of the Indebtedness owing to Lender in accordance with the Loan Documents. Lender may seek a judgment on the Note (and, if necessary, name Borrower in such suit) as part of judicial proceedings to foreclose on any Collateral or as a prerequisite to any such foreclosure or to confirm any foreclosure or sale pursuant to power of sale thereunder, and in the event any suit is brought on the Note(s), or with respect to any Indebtedness or any judgment rendered in such judicial proceedings, such judgment shall constitute a Lien on and may be enforced on and against the Collateral and the rents, profits, issues, products and proceeds thereof. Nothing in this Agreement shall impair the right of Lender to accelerate the maturity of the Note during the continuance of an Event of Default in accordance with the Loan Documents, nor shall anything in this Agreement impair or be construed to impair the right of Lender to seek personal judgments, and to enforce all rights and remedies under applicable law, jointly and severally against any indemnitors and guarantors to the extent allowed by any applicable Loan Documents. The provisions set forth in this Section are not intended as a release or discharge of the obligations due under the Note or under any Loan Documents, but are intended as a limitation, to the extent provided in this Section, on Lender’s right to ▇▇▇ for a deficiency or seek a personal judgment except as required in order to realize on the Collateral.
(d) For the avoidance of doubt, the failure to pay trade payables as a result of insufficient cash flow from the Property shall not trigger liability under this Section 9.19.;
Appears in 1 contract
Recourse. (a) Subject to Except as set forth in the qualifications hereinbalance of this Section, Lender in the Environmental Indemnity and in Section 9.14, no recourse shall not enforce Borrower’s obligation to pay be had for the Indebtedness by against any action Affiliate of the Obligors or proceeding wherein a deficiency judgment any officer, director, stockholder, partner, member or other judgment establishing personal liability shall be sought against Borrower owner of the Obligors or any of its affiliatessuch Affiliate, or any Exculpated Personseparate account contract holder, except for foreclosure actions beneficial owner, advisor, consultant, manager, fiduciary or employee of any other appropriate actions or proceedings against Borrower in order to fully exercise Lender’s remedies in respect ofof the foregoing, and recourse to realize upon, the Obligors shall be limited to the Obligors' interest in the Properties and the other Collateral, . Each Obligor and except for any actions to enforce any obligations expressly assumed or guaranteed the Nonrecourse Carveout Indemnitor (as evidenced by any guarantor, indemnitor or similar party (whether or not such party is an Exculpated Personthe Nonrecourse Carveout Indemnitor's signature below) under the Loan Documents; provided however such foreclosure or appropriate actions or proceedings against Borrower shall, in no event, seek to enforce Borrower’s obligation to pay the Indebtedness or other personal judgments against Borrower.
(b) Borrower shall indemnify Lender and hold Lender harmless from and against any and all Damages actual damages to Lender (including the actual reasonable legal and other expenses of enforcing the obligations of Borrower the Nonrecourse Carveout Indemnitor under this Section and Sponsor under the Guaranty9.19) resulting from fraud, intentional misrepresentation, voluntary bankruptcy filing by any Obligor or arising out Single-Purpose Equityholder, misappropriation or misapplication of any funds (including Loss Proceeds, Revenue and security deposits), Waste, failure of the following:
(iObligors to comply with Section 5.8(e) any intentional physical Waste at following the Property committed or permitted by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor;
(ii) any fraud or intentional misrepresentation in connection with the Loan committed by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor;
(iii) any willful misconduct by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor (including any bad faith interference by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor with the exercise any rights occurrence and remedies available to Lender as provided herein and in the other Loan Documents during the continuance of an Event of Default, any liability for the payment of mortgage recording or other similar taxes relating to the Mortgages securing the Maryland Guarantees, and any breach of the representation contained in Section 4.17 to the extent such breach relates to events occurring prior to the Closing Date (the "Indemnified Liabilities").
(b) Each Obligor and the Nonrecourse Carveout Indemnitor shall indemnify Lender and hold Lender harmless from and against any and all actual Damages to Lender resulting from or arising out of the Indemnified Liabilities (including the actual reasonable legal and other expenses of enforcing the obligations of the Nonrecourse Carveout Indemnitor under this Section 9.19(b)). The liability of the Nonrecourse Carveout Indemnitor under this Agreement shall be direct and immediate and not conditional or contingent upon the pursuit of any remedies against the Obligors or any other Person, nor against the Collateral, and shall not be impaired or limited by any of the following events, whether occurring with or without notice to the Nonrecourse Carveout Indemnitor or with or without consideration:
(i) any extensions of time for performance required by any of the Loan Documents or any extension or renewal of the Notes; 104
(ii) any sale, assignment or foreclosure of the Notes, any Mortgage(s) or any of the other Loan Documents or any sale or transfer of any or all of the Properties;
(iii) any Assumption or any other change in the composition of any Obligor, including the withdrawal or removal of the Nonrecourse Carveout Indemnitor from any current or future position of ownership, management or control of the Obligors;
(iv) the misappropriation accuracy or misapplication inaccuracy of the representations and warranties made by Borrower, Sponsor or the Obligors in any affiliate Controlled by Borrower and/or Sponsor of any funds in violation of the Loan Documents (including misappropriation or misapplication of Revenues, security deposits and/or Loss Proceeds)Documents;
(v) the release of the Obligors or of any other Person from performance or observance of any of the agreements, covenants, terms or conditions contained in any of the Loan Documents by operation of law, Lender's voluntary Debt incurred by Borrower if and to the extent the continued existence of such Debt is prohibited hereunder;act or otherwise; or
(vi) the failure to pay or maintain modification of the Policies or pay the amount terms of any deductible required thereunder following a Casualty one or more of the Loan Documents. The Nonrecourse Carveout Indemnitor hereby acknowledges that Lender would not make the Loans but for the personal liability undertaken by the Nonrecourse Carveout Indemnitor herein. The Nonrecourse Carveout Indemnitor agrees that it shall not demand or accept any payment from any Obligor in respect of any amounts owing or paid by the Nonrecourse Carveout Indemnitor hereunder until one year and one day after such time as the Indebtedness shall have been paid in full.
(c) Without limitation to any other insurance claimright or remedy provided to Lender in this Agreement or any of the other Loan Documents, provided that current cash flow is sufficient each Obligor acknowledges and available pursuant agrees that, to the Approved Management full extent permitted under applicable law, this Agreement for payment of same and provided Lender permits cash flow from the Property to be applied for such purpose;
(vii) other Loan Documents upon the failure of Borrower to be, and to at all times have been, a Single-Purpose Entity, regardless of whether such failure to have been a Single-Purpose Entity prior to the date hereof has been disclosed to Lender, and including any and all liabilities, contingent or otherwise, arising from or related to (x) the actions, conduct and/or operating history of Borrower (or any Person merged into Borrower) prior to the Closing Date and (y) Borrower’s ownership (or the ownership of any Person merged into Borrower) of assets prior to the Closing Date that do not constitute a portion of the Collateral;
(viii) removal of personal property by Borrower from the Property outside of the ordinary course of business during the continuance occurrence of an Event of Default (i) Lender shall have the right to pursue all of its rights and remedies in violation one proceeding, or separately and independently in separate proceedings which it, as Lender, in its sole and absolute discretion, shall determine from time to time, (ii) Lender is not required to either marshal assets, sell Collateral in any inverse order of alienation, or be subjected to any "one action" or "election or remedies" law or rule, (iii) the exercise by Lender of any remedies against any Collateral will not impede Lender from subsequently or simultaneously exercising remedies against any other Collateral, (iv) all Liens and other rights, remedies and privileges provided to Lender in this Agreement and in the other Loan Documents or otherwise shall remain in full force and effect until Lender has exhausted all of its remedies against the Collateral and all Collateral has been foreclosed, sold and/or otherwise realized upon and (v) each Property shall be security for the performance of all of the Loan Agreement, unless replaced with personal property Obligors' obligations hereunder. Each Obligor acknowledges and agrees that it shall be jointly and severally liable for the obligations of the same utility and of the same or greater value and utility; and
(ix) any fees or commissions paid by Borrower to any affiliate in violation of the terms of all Obligors under the Loan Documents. In addition .
(d) Notwithstanding anything to the foregoing, the Loan shall be fully recourse to Borrower and Sponsor, jointly and severally, if (i) there is any unauthorized Transfer of the Property contrary contained in this Section or in any other Collateral (including voluntary Liens and encumbrances on the Collateral other than Permitted Encumbrances) provision of this Agreement or Prohibited Change of Control or Prohibited Pledge, in each case, in violation any of the Loan Documents, no member, shareholder, partner, or other owner of any Obligor or the Nonrecourse Carveout Indemnitor (iior any interest therein) or any petition for bankruptcyseparate account contract holder, insolvencybeneficial owner, dissolution advisor, consultant, manager, fiduciary, director, officer, employee or liquidation agent of any of the foregoing, shall have any personal or other liability under the Bankruptcy Code or any similar federal or state law is filed byLoan, consented to, or acquiesced in by, Borrower, (iii) Borrower or any of its affiliates (including Sponsor) shall have colluded with other creditors to cause an involuntary filing under the Bankruptcy Code or similar federal or state law with respect to Borrower, or Borrower shall have terminated one or more of the Independent Directors for the purpose of facilitating a bankruptcy filing, or (iv) Borrower fails to be, and to at all times have been, a Single-Purpose Entity, which failure results in a substantive consolidation of Borrower with any affiliate in a bankruptcy or similar proceeding. All of Borrower’s liabilities under this Section 9.19(b) shall be guaranteed by Sponsor pursuant to the Guaranty.
(c) The foregoing limitations on personal liability shall in no way impair or constitute a waiver of the validity of the Notes, the Indebtedness secured by the Collateral, or the Liens on the Collateral, or the right of Lender, as mortgagee or secured party, to foreclose and/or enforce its rights with respect to the Collateral after an Event of Default. Nothing in this Agreement shall be deemed to be a waiver of any right which Lender may have under the Bankruptcy Code to file a claim for the full amount of the debt owing to Lender by Borrower or to require that all Collateral shall continue to secure all of the Indebtedness owing to Lender in accordance with the Loan Documents. Lender may seek a judgment on the Note (and, if necessary, name Borrower in such suit) as part of judicial proceedings to foreclose on any Collateral or as a prerequisite to any such foreclosure or to confirm any foreclosure or sale pursuant to power of sale thereunder, and in the event any suit is brought on the Note(s), or with respect to any Indebtedness or any judgment rendered in such judicial proceedings, such judgment shall constitute a Lien on and may be enforced on and against the Collateral and the rents, profits, issues, products and proceeds thereof. Nothing in this Agreement shall impair the right of Lender to accelerate the maturity of the Note during the continuance of an Event of Default in accordance with the other Loan Documents, nor shall anything in this Agreement impair or be construed to impair 105 except for the right of Lender to seek personal judgments, Obligors and to enforce all rights and remedies under applicable law, jointly and severally against any indemnitors and guarantors to the extent allowed by any applicable Loan Documents. The provisions set forth in this Section are not intended as a release or discharge of the obligations due under the Note or under any Loan Documents, but are intended as a limitation, Nonrecourse Carveout Indemnitor to the extent provided herein and in this Section, on Lender’s right to ▇▇▇ for a deficiency or seek a personal judgment except as required in order to realize on the CollateralEnvironmental Indemnity.
(d) For the avoidance of doubt, the failure to pay trade payables as a result of insufficient cash flow from the Property shall not trigger liability under this Section 9.19.
Appears in 1 contract
Recourse. (a) Subject to Except for any indemnification by Borrower under this Agreement or any indemnification by Borrower or Sponsor under any of the qualifications hereinother Loan Documents, Lender shall not enforce BorrowerLender’s obligation to pay the Indebtedness by any action or proceeding wherein a deficiency judgment or other judgment establishing personal liability recourse shall be sought solely to Borrower, the Property and the Collateral, except as set forth below. In addition, no recourse shall be had for the Loan against any other Person, including any affiliate of Borrower or any officer, director, partner or equityholder of its affiliates, Borrower or any Exculpated Personsuch affiliate, except for foreclosure actions or any other appropriate actions or proceedings against Borrower unless expressly set forth in order to fully exercise Lender’s remedies in respect of, and to realize upon, the Collateral, and except for any actions to enforce any obligations expressly assumed or guaranteed by any guarantor, indemnitor or similar party (whether or not such party is an Exculpated Person) under the a Loan Documents; provided however such foreclosure or appropriate actions or proceedings against Borrower shall, in no event, seek to enforce Borrower’s obligation to pay the Indebtedness Document or other personal judgments against Borrowerwritten agreement to which such Person is a party.
(b) Borrower shall indemnify Lender and hold Lender harmless from and against any and all Damages to Lender (including the reasonable and actual out-of-pocket legal and other expenses of enforcing the obligations of Borrower under this Section 9.19 and the Sponsor under the Guaranty and the Completion Guaranty) resulting from or arising out of any of the followingfollowing (the “Indemnified Liabilities”), which Indemnified Liabilities shall be guaranteed by Sponsor pursuant to the Guaranty:
(i) any intentional or grossly negligent physical Waste at with respect to any of the Property Properties or FF&E committed or permitted consented to by Borrower, Operating Lessee, Sponsor or any affiliate Controlled by Borrower and/or Sponsorof their respective Affiliates;
(ii) any fraud or intentional misrepresentation committed by Borrower, Operating Lessee, Sponsor or any of their respective Affiliates, in each case, in connection with the Loan committed by Borrower, Sponsor or any affiliate Controlled by Borrower and/or SponsorCollateral;
(iii) any bad faith willful misconduct by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor of their respective Affiliates (including (1) any litigation or other legal proceeding initiated by such Person in bad faith interference by Borrowerthat delays, Sponsor opposes impedes, obstructs, hinders, enjoins or any affiliate Controlled by Borrower and/or Sponsor otherwise interferes with or frustrates the efforts of Lender to exercise any rights and remedies available to Lender as provided herein and in the other Loan Documents during the continuance of an Event of DefaultDefault and (2) any refusal by Borrower to comply with Section 5.9 hereof);
(iv) the misappropriation or misapplication by Borrower, Operating Lessee, the Sponsor or any affiliate Controlled by Borrower and/or Sponsor of their respective affiliates of any funds in violation of the Loan Documents (Documents, including misappropriation or misapplication of Revenues, security deposits and/or Loss ProceedsProceeds and the violation of the last sentence of Section 5.7(d) (for the avoidance of doubt, neither Borrower nor Sponsor shall have any liability for the failure of Lender or the Cash Management Bank to properly apply funds contained in the Collateral Accounts, provided Lender’s or Cash Management Bank’s access to such funds is not obstructed or interfered with in any way by the activities of Borrower or its Affiliates or by any action or proceeding affecting any of them or the Collateral);
(v) any the incurrence of voluntary Debt incurred by of Borrower or Operating Lessee prohibited hereunder, provided that, for the purpose of this clause (v), Debt will be regarded as voluntary if and to the extent the continued existence of such Debt is prohibited hereunderincurred voluntarily or incurred involuntarily and not repaid despite the availability of sufficient cash flow from the Property and Lender permits such cash flow to be used to repay such Debt;
(vi) any breach by Borrower, Operating Lessee or the Sponsor of any representation or covenant regarding environmental matters contained in this Agreement or in the Environmental Indemnity;
(vii) the failure to pay or maintain the Policies or pay the amount of any deductible required thereunder following a Casualty or other insurance claim, provided that current claim despite the availability of sufficient cash flow is sufficient and available pursuant to from the Approved Management Agreement for payment of same and Property, provided Lender permits cash flow from the Property Properties to be applied for such purpose;
(viiviii) the failure of Borrower any of Borrower, Operating Lessee and/or Operating Lessee Pledgor to be, and to at all times have been, a Single-Purpose Entity, regardless of whether such failure to have been a Single-Purpose Entity prior to the date hereof has been disclosed to Lender, and including any and all liabilities, contingent or otherwise, arising from or related to (x) the actions, conduct and/or operating history of Borrower or Operating Lessee (or any Person merged into BorrowerBorrower or Operating Lessee) prior to the Closing Date and (y) Borrower’s and/or Operating Lessee’s ownership (or the ownership of any Person merged into Borrower) of assets prior to the Closing Date that do not constitute a portion of the Collateral;
(viiiix) removal of personal property or FF&E by Borrower Borrower, Operating Lessee or any Affiliate thereof from the Property outside any of the ordinary course of business Properties during the continuance of an Event of Default in violation of the Loan AgreementDefault, unless replaced with personal property or FF&E, as applicable, of the same utility and of the same or greater value and utility; and;
(ixx) the payment of any fees or commissions paid by Borrower or Operating Lessee to any affiliate Affiliate in violation of the terms of the Loan Documents. ;
(xi) the failure of any of the Properties to comply with all applicable zoning requirements, including the failure to have certificates of occupancy that permit the use of the Properties as transient hotels (but excluding Damages arising from an inability to restore any Property to its condition prior to a Casualty due to Legal Requirements that prohibit the same in connection with a Casualty that destroys 75% or more of the Property), and any enforcement action sought by any Governmental Authority in respect thereof;
(xii) the failure of Borrower and Operating Lessee to renew the term of any Operating Lease; and
(xiii) the failure of Borrower to maintain the required account balance in the Borrower FF&E Account (it being agreed that Damages in such event shall include the amount of any funds not deposited to the Borrower FF&E Account); In addition to the foregoing, the Loan shall be fully recourse to Borrower and Sponsor, jointly and severally, if upon (iA) there is any Change of Control, unauthorized Transfer of any portion of one or more of the Property Properties constituting real property or any other Collateral (including voluntary unauthorized Liens and encumbrances on any portion of one or more of the Collateral other than Properties constituting real property (except for mechanic’s liens and similar Liens that are addressed by Borrower or Operating Lessee in accordance with clause (iv) of the definition of Permitted Encumbrances) or Prohibited Change of Control or Prohibited Pledge), in each case, in violation of the Loan Documents, (iiB) the occurrence of any petition for bankruptcyfiling by any of Borrower, insolvency, dissolution Operating Lessee or liquidation Operating Lessee Pledgor under the Bankruptcy Code or any similar federal joining or state law is filed by, consented to, or acquiesced in by, colluding by any of Borrower, (iii) Borrower Operating Lessee or Operating Pledgor or any of its affiliates their respective Affiliates (including Sponsor) shall have colluded with other creditors the intent to cause the filing of an involuntary filing case in respect of any Borrower or Operating Lessee under the Bankruptcy Code (provided, however, that if such involuntary case is dismissed within 60 days of such filing the Loan shall not be fully recourse to Borrower and Sponsor, however Borrower and Sponsor shall indemnify Lender and hold Lender harmless from and against any and all Damages to Lender arising from or similar federal related to the filing of such involuntary case) or state law with respect to (C) the failure of any Borrower, Operating Lessee or Borrower shall have terminated one or more of the Independent Directors for the purpose of facilitating a bankruptcy filing, or (iv) Borrower fails Operating Lessee Pledgor to be, and to at all times have been, a Single-Purpose Entity, which failure results in a substantive consolidation of such Borrower with any affiliate Affiliate (other than a co-Borrower under the Loan) in a bankruptcy or similar proceedingproceeding (or the filing of a motion by any Person other than Lender for substantive consolidation in bankruptcy citing any such failure, provided, however, that if such motion is dismissed within 120 days of filing the Loan shall not be fully recourse to Borrower and Sponsor, however Borrower and Sponsor shall indemnify Lender and hold Lender harmless from and against any and all Damages to Lender arising from or related to such motion). All The Loan shall be fully recourse to Sponsor in an amount equal to its unpaid Guaranteed Obligations (as such term is defined in the Completion Guaranty) under the Completion Guaranty. The liability of Borrower’s liabilities under the Persons comprising Sponsor for each of clauses (i) through (xvi) and (A), (B) and (C) of this Section 9.19(b) shall be guaranteed by Sponsor pursuant to either several or joint and several, as described in the Guaranty.
(c) The foregoing limitations on personal liability shall in no way impair or constitute a waiver of the validity of the Notes, the Indebtedness secured by the Collateral, or the Liens on the Collateral, or the right of Lender, as mortgagee or secured party, to foreclose and/or enforce its rights with respect to the Collateral after an Event of Default. Nothing in this Agreement shall be deemed to be a waiver of any right which Lender may have under the Bankruptcy Code to file a claim for the full amount of the debt owing to Lender by Borrower or to require that all Collateral shall continue to secure all of the Indebtedness owing to Lender in accordance with the Loan Documents. Lender may seek a judgment on the Note (and, if necessary, name Borrower in such suit) as part of judicial proceedings to foreclose on under the Mortgage or to foreclose pursuant to any Collateral other Loan Documents, or as a prerequisite to any such foreclosure or to confirm any foreclosure or sale pursuant to power of sale thereunder, and in the event any suit is brought on the Note(s)Notes, or with respect to any Indebtedness or any judgment rendered in such judicial proceedings, such judgment shall constitute a Lien on and may will be and can be enforced on and against the Collateral and the rents, profits, issues, products and proceeds thereof. Nothing in this Agreement shall impair the right of Lender to accelerate the maturity of the Note during upon the continuance occurrence of an Event of Default in accordance with the Loan DocumentsDefault, nor shall anything in this Agreement impair or be construed to impair the right of Lender to seek personal judgments, and to enforce all rights and remedies under applicable law, jointly and severally against any indemnitors and guarantors to the extent allowed by any applicable Loan Documentsguarantees. The provisions set forth in this Section 9.19 are not intended as a release or discharge of the obligations due under the Note or under any Loan Documents, but are intended as a limitation, to the extent provided in this Section, on Lender’s right to ▇▇▇ for a deficiency or seek a personal judgment against Borrower or Sponsor except as required in order to realize on the Collateral.
(d) For the avoidance of doubt, the failure to pay trade payables as a result of insufficient cash flow from the Property shall not trigger liability under this Section 9.19.
Appears in 1 contract
Recourse. (a) Subject Indemnitor agrees that the obligations of Indemnitor hereunder are separate, independent of and in addition to Indemnitor's obligations under the qualifications herein, Lender shall not enforce Borrower’s obligation to pay the Indebtedness by any action or proceeding wherein a deficiency judgment or other judgment establishing personal liability shall be sought against Borrower or any of its affiliates, or any Exculpated Person, except for foreclosure actions Indenture or any other appropriate actions or proceedings against Borrower in order to fully exercise Lender’s remedies in respect of, and to realize upon, the Collateral, and except for any actions to enforce any obligations expressly assumed or guaranteed by any guarantor, indemnitor or similar party (whether or not such party is an Exculpated Person) under the Loan Documents; provided however such foreclosure or appropriate actions or proceedings against Borrower shall, in no event, seek to enforce Borrower’s obligation to pay the Indebtedness or other personal judgments against BorrowerTransaction Document.
(b) Borrower Indemnitor agrees that a separate action may be brought to enforce the provisions of this Indemnity, which shall indemnify Lender and hold Lender harmless from and in no way be deemed to be an action on the Notes, whether or not the Trustee would be entitled to a deficiency judgment following a judicial foreclosure or sale under any Deed of Trust. Indemnitor waives any right to require that any action be brought by the Trustee or any holder of a Note against Indemnitor or any and all Damages to Lender (including the legal and other expenses of enforcing the obligations of Borrower under this Section and Sponsor Person, or that any other remedy under the Guaranty) resulting from or arising out of Indenture, this Indemnity, any of the following:
(i) any intentional physical Waste at the Property committed or permitted by Borrowerother Collateral Document, Sponsor or any affiliate Controlled other document entered into by Borrower and/or Sponsor;
(ii) any fraud or intentional misrepresentation Indemnitor in connection with the Loan committed by Borrowerforegoing be exercised. The Trustee may, Sponsor or any affiliate Controlled by Borrower and/or Sponsor;
(iii) any willful misconduct by Borrowerat its option, Sponsor or any affiliate Controlled by Borrower and/or Sponsor (including any bad faith interference by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor with the exercise any rights and remedies available to Lender as provided herein and proceed against Indemnitor in the other Loan Documents during the continuance of an Event of Default);
(iv) the misappropriation first instance to collect monies when due or misapplication by Borrowerto obtain performance under this Indemnity, Sponsor or any affiliate Controlled by Borrower and/or Sponsor of any funds in violation of the Loan Documents (including misappropriation or misapplication of Revenues, security deposits and/or Loss Proceeds);
(v) any voluntary Debt incurred by Borrower if and to the extent the continued existence of such Debt is prohibited hereunder;
(vi) the failure to pay or maintain the Policies or pay the amount of any deductible required thereunder following a Casualty or other insurance claim, provided that current cash flow is sufficient and available pursuant to the Approved Management Agreement for payment of same and provided Lender permits cash flow from the Property to be applied for such purpose;
(vii) the failure of Borrower to be, and to at all times have been, a Single-Purpose Entity, regardless of whether such failure to have been a Single-Purpose Entity prior to the date hereof has been disclosed to Lender, and including any and all liabilities, contingent or otherwise, arising from or related to (x) the actions, conduct and/or operating history of Borrower (or any Person merged into Borrower) prior to the Closing Date and (y) Borrower’s ownership (or the ownership of any Person merged into Borrower) of assets prior to the Closing Date that do not constitute a portion of the Collateral;
(viii) removal of personal property by Borrower from the Property outside of the ordinary course of business during the continuance of an Event of Default in violation of the Loan Agreement, unless replaced with personal property of the same utility and of the same or greater value and utility; and
(ix) any fees or commissions paid by Borrower to any affiliate in violation of the terms of the Loan Documents. In addition to the foregoing, the Loan shall be fully recourse to Borrower and Sponsor, jointly and severally, if (i) there is any unauthorized Transfer of the Property without first proceeding against Indemnitor or any other indemnitor or any other Person and without first resorting to any other indemnity, the Indenture, this Indemnity, any Collateral (including voluntary Liens and encumbrances on Document, or any other document entered into by Indemnitor in connection with the Collateral foregoing or any other than Permitted Encumbrances) or Prohibited Change of Control or Prohibited Pledge, in each case, in violation of the Loan Documents, (ii) any petition for bankruptcy, insolvency, dissolution or liquidation remedy under the Bankruptcy Code Indenture, this Indemnity, any Collateral Document, or any similar federal or state law is filed by, consented to, or acquiesced other document entered into by Indemnitor in by, Borrower, (iii) Borrower or any of its affiliates (including Sponsor) shall have colluded connection with other creditors to cause an involuntary filing under the Bankruptcy Code or similar federal or state law with respect to Borrower, or Borrower shall have terminated one or more of the Independent Directors for the purpose of facilitating a bankruptcy filing, or (iv) Borrower fails to be, and to at all times have been, a Single-Purpose Entity, which failure results in a substantive consolidation of Borrower with any affiliate in a bankruptcy or similar proceeding. All of Borrower’s liabilities under this Section 9.19(b) shall be guaranteed by Sponsor pursuant to the Guarantyforegoing.
(c) The foregoing limitations on personal liability shall in no way impair or constitute a waiver This Indemnity is not given as additional security for the Notes and is entirely independent of the validity Notes (except as provided in Section 5), and shall not be measured or affected by any amounts at any time owing under the other Transaction Documents, the sufficiency or insufficiency of any collateral (including without limitation the Premises) given to the Trustee to secure repayment of the Notes, or the Indebtedness consideration given by the Trustee or any other party in order to acquire the Premises or any portion thereof. None of the obligations of Indemnitor hereunder shall be in any way secured by the Collateral, or the Liens on the Collateral, or the right of Lender, as mortgagee or secured party, to foreclose and/or enforce its rights with respect to the Collateral after an Event of Default. Nothing in this Agreement shall be deemed to be a waiver of any right which Lender may have under the Bankruptcy Code to file a claim for the full amount lien of the debt owing to Lender by Borrower or to require that all Collateral shall continue to secure all Deed of the Indebtedness owing to Lender in accordance with the Loan Documents. Lender may seek a judgment on the Note (and, if necessary, name Borrower in such suit) as part of judicial proceedings to foreclose on any Collateral or as a prerequisite to any such foreclosure or to confirm any foreclosure or sale pursuant to power of sale thereunder, and in the event any suit is brought on the Note(s), or with respect to any Indebtedness Trust or any judgment rendered in such judicial proceedings, such judgment shall constitute a Lien on and may be enforced on and against the Collateral and the rents, profits, issues, products and proceeds thereof. Nothing in this Agreement shall impair the right of Lender to accelerate the maturity of the Note during the continuance of an Event of Default in accordance with the Loan Documents, nor shall anything in this Agreement impair or be construed to impair the right of Lender to seek personal judgments, and to enforce all rights and remedies under applicable law, jointly and severally against any indemnitors and guarantors to the extent allowed by any applicable Loan Documents. The provisions set forth in this Section are not intended as a release or discharge of the obligations due under the Note or under any Loan Documents, but are intended as a limitation, to the extent provided in this Section, on Lender’s right to ▇▇▇ for a deficiency or seek a personal judgment except as required in order to realize on the Collateralother Transaction Document.
(d) For the avoidance of doubt, the failure to pay trade payables as a result of insufficient cash flow from the Property shall not trigger liability under this Section 9.19.
Appears in 1 contract
Recourse. (a) Subject to the qualifications herein, Lender shall not enforce Borrower’s obligation to pay the Indebtedness by any action or proceeding wherein a deficiency judgment or other judgment establishing personal liability shall be sought against Borrower or any of its affiliates, or any Exculpated Person, except for foreclosure actions or any other appropriate actions or proceedings against Borrower in order to fully exercise Lender’s remedies in respect of, and to realize upon, the Collateral, and except for any actions to enforce any obligations expressly assumed or guaranteed by any guarantor, indemnitor or similar party (whether or not such party is an Exculpated Person) under the Loan Documents; provided however such foreclosure Documents or appropriate actions or proceedings against the obligations of Borrower shall, in no event, seek to enforce Borrower’s obligation to pay the Indebtedness or other personal judgments against Borrowerunder Section 9.19(b).
(b) Borrower shall indemnify Lender and hold Lender harmless from and against any and all Damages to Lender (including the legal and other expenses of enforcing the obligations of Borrower under this Section and Sponsor under the Guaranty) resulting from or arising out of any of the following:
(i) any intentional physical Waste at any of the Property Properties committed or permitted by Borrower, Sponsor Sponsor, Master Tenant or any affiliate Controlled of their respective affiliates; provided, however, that no liability shall result under this clause (i) (A) with respect to alterations made by Borrower and/or Sponsoror Master Tenant to any Property in accordance with Section 6.13 hereof or (B) if the Properties failed to generate sufficient cash flow to pay for maintenance and repairs at the applicable Property or if funds reserved by Lender for such purpose have not been made available to Borrower by Lender to pay such amounts;
(ii) any fraud or intentional misrepresentation in connection with the Loan committed by Borrower, Sponsor Sponsor, Master Tenant or any affiliate Controlled by Borrower and/or Sponsorof their respective affiliates;
(iii) any willful misconduct by Borrower, Sponsor Sponsor, Master Tenant or any affiliate Controlled by Borrower and/or Sponsor of their respective affiliates (including any litigation or other legal proceeding initiated by such Person in bad faith interference or which is determined by Borrowera court of competent jurisdiction to be frivolous that delays, Sponsor opposes, impedes, obstructs, hinders, enjoins or any affiliate Controlled by Borrower and/or Sponsor otherwise interferes with or frustrates the efforts of Lender to exercise any rights and remedies available to Lender as provided herein and in the other Loan Documents during the continuance of an Event of DefaultDefault (but in no event including any good faith defense asserted by Borrower, Sponsor or any of their respective Affiliates);
(iv) the misappropriation or intentional misapplication by Borrower, Sponsor Sponsor, Master Tenant or any affiliate Controlled by Borrower and/or Sponsor of their respective affiliates of any funds in violation of the Loan Documents (including misappropriation or misapplication of Revenues, Master Lease Rent, security deposits and/or Loss Proceeds);
(v) any voluntary Debt incurred by Borrower (other than Permitted Debt) if and to the extent the continued existence of such Debt is prohibited hereunder, unless such Debt arises from an insufficiency of cash flow to pay such Debt;
(vi) any breach by Borrower or Sponsor of any representation or covenant regarding environmental matters contained in this Agreement or in the Environmental Indemnity (in each case beyond all applicable notice and cure periods set forth in the Loan Documents);
(vii) failure to pay Taxes, charges for labor or materials or other charges that can create liens on any portion of any Property in accordance with the terms and provisions hereof; provided, however, that no liability shall result under this clause (vii) if (A) Lender fails to permit cash flow from the Properties to be applied for such purpose or (B) if the Properties failed to generate sufficient cash flow to pay any such amounts when due;
(viii) failure to pay or maintain the Policies or pay the amount of any deductible required thereunder following a Casualty or other insurance claim; provided, provided however, that current cash flow is sufficient and available pursuant no liability shall result under this clause (viii) if (A) Lender fails to the Approved Management Agreement for payment of same and provided Lender permits permit cash flow from the Property Properties to be applied for such purposepurpose or (B) if the Properties failed to generate sufficient cash flow to pay any such amounts when due;
(viiix) the failure of Borrower to be, and to at all times have been, a Single-Purpose Entity, regardless of whether such failure to have been a Single-Purpose Entity prior to the date hereof has been disclosed to Lender, and including any and all liabilities, contingent or otherwise, arising from or related to (x) the actions, conduct and/or operating history of Borrower (or any Person merged into Borrower) prior to the Closing Date and (y) Borrower’s ownership (or the ownership of any Person merged into Borrower) of assets prior to the Closing Date that do not constitute a portion of the CollateralCollateral and/or the filing by any Person of a motion for substantive consolidation in bankruptcy citing any such failure (for the avoidance of doubt, the recourse described in this clause shall be in addition to the full recourse for a substantive consolidation as described below); provided, however, that no liability shall result under this clause (ix) with respect to (A) failures to pay unsecured trade payables and operational debt incurred in the ordinary course of Borrower’s business if there is insufficient case flow from the properties (or if funds reserved by Lender for such purposes have not been made available to Borrower by Lender to pay such outstanding amounts) and (B) Sponsor is not obligated to fund additional capital to make any loans to Borrower;
(viiix) removal of personal property by Borrower from the Property outside any of the ordinary course of business Properties after the occurrence and during the continuance of an Event of Default in violation of the Loan AgreementDefault, unless replaced with personal property of the same utility and of the same or greater value and utility; and;
(ixxi) any fees or commissions paid by Borrower to any affiliate in violation of the terms of the Loan Documents;
(xii) intentionally omitted;
(xiii) the contesting or opposition by Borrower, Sponsor or any of their respective affiliates of any motion filed by Lender for relief from the automatic stay in any bankruptcy proceeding of Borrower;
(xiv) any material modification, termination, surrender, waiver or cancellation of any Ground Lease (including pursuant to a Fee Acquisition) in violation of the Loan Documents;
(xv) except as expressly set forth below with respect to full recourse liability in the following paragraph in clause (i), any Transfer occurs in violation of the Loan Documents if such Transfer does not result in (A) a Prohibited Change of Control or (B) a voluntary Transfer of title to all or any portion of the fee title to the real estate comprising the Properties. In addition to the foregoing, the Loan and all Indebtedness shall be fully recourse to Borrower and Sponsor, jointly and severally, if (i) there is any unauthorized Transfer occurs in violation of the Property or any other Collateral Loan Documents if such Transfer results in (including voluntary Liens and encumbrances on the Collateral other than Permitted EncumbrancesA) or a Prohibited Change of Control or Prohibited Pledge, in each case, in violation (B) a voluntary Transfer of title to all or any portion of the Loan Documentsfee title to the real estate comprising the Properties, (ii) any petition for bankruptcy, insolvency, dissolution or liquidation under the Bankruptcy Code or any similar federal or state law is filed by, consented to, or acquiesced in by, Borrower, (iii) Borrower or any of its affiliates Affiliates (including Sponsor) shall have colluded with other creditors to cause an involuntary filing under the Bankruptcy Code or similar federal or state law with respect to Borrower, or Borrower shall have terminated one or more of the Independent Directors for the purpose of facilitating a bankruptcy filing, or (iv) Borrower fails to be, and to at all times have been, a Single-Purpose Entity, which failure results in a substantive consolidation of Borrower with any affiliate in a bankruptcy or similar proceeding, or (v) any material modification, termination, surrender, waiver or cancellation of the Master Lease in violation of the Loan Documents. All of Borrower’s liabilities under this Section 9.19(b) shall be guaranteed by Sponsor pursuant to the Guaranty.
(c) The foregoing limitations on personal liability shall in no way impair or constitute a waiver of the validity of the Notes, the Indebtedness secured by the Collateral, or the Liens on the Collateral, or the right of Lender, as mortgagee or secured party, to foreclose and/or enforce its rights with respect to the Collateral after an Event of Default. Nothing in this Agreement shall be deemed to be a waiver of any right which Lender may have under the Bankruptcy Code to file a claim for the full amount of the debt owing to Lender by Borrower or to require that all Collateral shall continue to secure all of the Indebtedness owing to Lender in accordance with the Loan Documents. Lender may seek a judgment on the Note (and, if necessary, name Borrower in such suit) as part of judicial proceedings to foreclose on any Collateral or as a prerequisite to any such foreclosure or to confirm any foreclosure or sale pursuant to power of sale thereunder, and in the event any suit is brought on the Note(s)Notes, or with respect to any Indebtedness or any judgment rendered in such judicial proceedings, such judgment shall constitute a Lien on and may be enforced on and against the Collateral and the rents, profits, issues, products and proceeds thereof. Nothing in this Agreement shall impair the right of Lender to accelerate the maturity of the Note during upon the continuance occurrence of an Event of Default in accordance with the Loan DocumentsDefault, nor shall anything in this Agreement impair or be construed to impair the right of Lender to seek personal judgments, and to enforce all rights and remedies under applicable law, jointly and severally against any indemnitors and guarantors to the extent allowed by any applicable Loan Documents. The provisions set forth in this Section are not intended as a release or discharge of the obligations due under the Note or under any Loan Documents, but are intended as a limitation, to the extent provided in this Section, on Lender’s right to ▇▇▇ for a deficiency or seek a personal judgment except as required in order to realize on the Collateral.
(d) For the avoidance of doubt, the failure to pay trade payables as a result of insufficient cash flow from the Property shall not trigger liability under this Section 9.19.
Appears in 1 contract
Sources: Loan Agreement (Toys R Us Inc)
Recourse. (a) Subject to Each Mortgage Loan is non-recourse, except that the qualifications hereinBorrower and in the case of a Mortgage Loan with an initial principal balance of $3,000,000 or more, Lender shall not enforce Borrower’s obligation to pay either: a principal of the Indebtedness by any action or proceeding wherein Borrower who is a deficiency judgment natural person or other judgment establishing personal liability shall individual guarantor who is a natural person, with assets other than any interest in the Borrower has agreed to be sought against Borrower jointly and severally liable for all liabilities, expenses, losses, damages, expenses or any of its affiliates, claims suffered or any Exculpated Person, except for foreclosure actions or any other appropriate actions or proceedings against Borrower in order to fully exercise Lender’s remedies in respect of, and to realize upon, incurred by the Collateral, and except for any actions to enforce any obligations expressly assumed or guaranteed by any guarantor, indemnitor or similar party (whether or not such party is an Exculpated Person) under the Loan Documents; provided however such foreclosure or appropriate actions or proceedings against Borrower shall, in no event, seek to enforce Borrower’s obligation to pay the Indebtedness or other personal judgments against Borrower.
(b) Borrower shall indemnify Lender and hold Lender harmless from and against any and all Damages to Lender (including the legal and other expenses of enforcing the obligations of Borrower under this Section and Sponsor under the Guaranty) resulting from or arising out of any holder of the following:
Mortgage Loan by reason of or in connection with: (i) any intentional physical Waste at fraud or material misrepresentation by the Property committed or permitted by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor;
(ii) any fraud misapplication or intentional misrepresentation in connection with misappropriation of rents, insurance payments, condemnation awards, tenant security deposits or other funds subject to the Loan committed by BorrowerMortgage, Sponsor or any affiliate Controlled by Borrower and/or Sponsor;
(iii) acts of material, physical waste (or, alternatively, the failure to repair or restore the related Mortgaged Property in accordance with any willful misconduct related Mortgage Loan document, to the extent not covered by Borrowerinsurance proceeds paid on account of damage which is the subject of any such repair or restoration which are made available for such purpose to the Borrower or the holder of the Mortgage Loan) , Sponsor or any affiliate Controlled by Borrower and/or Sponsor (including any bad faith interference by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor with the exercise any rights and remedies available to Lender as provided herein and in the other Loan Documents during the continuance of an Event of Default);
(iv) the misappropriation or misapplication by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor of any funds in violation of the Loan Documents (including misappropriation applicable environmental laws or misapplication breaches of Revenues, security deposits and/or Loss Proceeds);
environmental covenants or (v) any the related Mortgaged Property becoming an asset in a voluntary Debt incurred bankruptcy or insolvency proceeding instituted by the Borrower, that impairs the ability of the holder of the related Mortgage Loan to enforce its lien on the related Mortgaged Property. With respect to clause (iv) in this paragraph, environmental insurance meeting the requirements set forth in Paragraph 39 shall satisfy such requirement. With respect to clause(v) in this paragraph, such requirement will be satisfied if the related Mortgage Loan documents provide that the non-recourse provisions of the Mortgage Loan documents shall not be applicable to Borrower if (and a principal of Borrower who is a natural person or other individual guarantor who is a natural person shall guaranty the Borrower's recourse obligations arising from such non-applicability) either (a) in the event of a voluntary bankruptcy filing by the Borrower or (b) to the extent the continued existence Mortgage Loan holder's rights of such Debt is prohibited hereunder;
(vi) the failure to pay or maintain the Policies or pay the amount of any deductible required thereunder following a Casualty or other insurance claim, provided that current cash flow is sufficient and available pursuant recourse to the Approved Management Agreement for payment of same and provided Lender permits cash flow from the Mortgaged Property to be applied for such purpose;
(vii) the failure of Borrower to be, and to at all times have been, a Single-Purpose Entity, regardless of whether such failure to have been a Single-Purpose Entity prior to the date hereof has been disclosed to Lender, and including any and all liabilities, contingent are impaired by or otherwise, arising from or related to (x) the actions, conduct and/or operating history of Borrower (or any Person merged into Borrower) prior to the Closing Date and (y) Borrower’s ownership (or the ownership of any Person merged into Borrower) of assets prior to the Closing Date that do not constitute a portion of the Collateral;
(viii) removal of personal property by Borrower from the Property outside of the ordinary course of business during the continuance of an Event of Default in violation of the Loan Agreement, unless replaced with personal property of the same utility and of the same or greater value and utility; and
(ix) any fees or commissions paid by Borrower to any affiliate in violation of the terms of the Loan Documents. In addition to the foregoing, the Loan shall be fully recourse to Borrower and Sponsor, jointly and severally, if (i) there is any unauthorized Transfer of the Property or any other Collateral (including voluntary Liens and encumbrances on the Collateral other than Permitted Encumbrances) or Prohibited Change of Control or Prohibited Pledge, in each case, in violation of the Loan Documents, (ii) any petition for bankruptcy, insolvency, dissolution or liquidation under the Bankruptcy Code or any similar federal or state law is filed by, consented to, or acquiesced in by, Borrower, (iii) Borrower or any of its affiliates (including Sponsor) shall have colluded with other creditors to cause an involuntary filing under the Bankruptcy Code or similar federal or state law with respect to Borrower, or Borrower shall have terminated one or more of the Independent Directors for the purpose of facilitating a bankruptcy filing, or (iv) Borrower fails to be, and to at all times have been, a Single-Purpose Entity, which failure results in a substantive consolidation of Borrower with any affiliate in a bankruptcy or similar proceeding. All of Borrower’s liabilities under this Section 9.19(b) shall be guaranteed by Sponsor pursuant to the Guaranty.
(c) The foregoing limitations on personal liability shall in no way impair or constitute a waiver of the validity of the Notes, the Indebtedness secured by the Collateral, or the Liens on the Collateral, or the right of Lender, as mortgagee or secured party, to foreclose and/or enforce its rights with respect to the Collateral after an Event of Default. Nothing in this Agreement shall be deemed to be a waiver of any right which Lender may have under the Bankruptcy Code to file a claim for the full amount of the debt owing to Lender by Borrower or to require that all Collateral shall continue to secure all of the Indebtedness owing to Lender in accordance with the Loan Documents. Lender may seek a judgment on the Note (and, if necessary, name Borrower in such suit) as part of judicial proceedings to foreclose on any Collateral or as a prerequisite to any such foreclosure or to confirm any foreclosure or sale pursuant to power of sale thereunder, and in the event any suit is brought on the Note(s), or with respect to any Indebtedness or any judgment rendered in such judicial proceedings, such judgment shall constitute a Lien on and may be enforced on and against the Collateral and the rents, profits, issues, products and proceeds thereof. Nothing in this Agreement shall impair the right of Lender to accelerate the maturity of the Note during the continuance of an Event of Default in accordance with the Loan Documents, nor shall anything in this Agreement impair or be construed to impair the right of Lender to seek personal judgments, and to enforce all rights and remedies under applicable law, jointly and severally against any indemnitors and guarantors to the extent allowed by any applicable Loan Documents. The provisions set forth in this Section are not intended as a release or discharge of the obligations due under the Note or under any Loan Documents, but are intended as a limitation, to the extent provided in this Section, on Lender’s right to ▇▇▇ for a deficiency or seek a personal judgment except as required in order to realize on the Collateral.
(d) For the avoidance of doubt, the failure to pay trade payables as a result of insufficient cash flow from any legal proceeding (including a voluntary bankruptcy or insolvency proceeding) instituted by the Property shall not trigger Borrower. No waiver of liability under this Section 9.19for such non-recourse exceptions has been granted to the Borrower or any such guarantor or principal by the Seller or anyone acting on behalf of the Seller.
Appears in 1 contract
Sources: Mortgage Loan Purchase Agreement (Salomon Brothers Mortgage Securities Vii Inc)
Recourse. (a) Subject to the qualifications herein, Lender shall not enforce Borrower’s the liability and obligation of Borrower to pay the Indebtedness or perform and observe the other obligations set forth in this Agreement and the other Loan Documents by any action or proceeding wherein a deficiency judgment or other judgment establishing personal liability shall be sought against Borrower or any of its affiliates, or against any Exculpated Person, except for foreclosure actions or any other appropriate actions or proceedings against Borrower in order to the extent required to fully exercise Lender’s 's remedies in respect of, and to realize upon, the Collateral, and except for any actions to enforce the (i) Indemnified Liabilities, (ii) the liabilities of Borrower under this Agreement (other than the repayment of the Loan), the Cooperation Agreement any obligations expressly assumed required completion guaranty required pursuant to Section 5.23 and any indemnities set forth in the Loan Documents and (iii) the liabilities and indemnities of Sponsor (and any replacement guarantor or guaranteed by any guarantor, indemnitor or similar party (whether or not such party is an Exculpated Personindemnitor) under this Environmental Indemnity, 49125-481/Block 21 (TX) the Loan Documents; provided however such foreclosure or appropriate actions or proceedings against Borrower shallGuaranty, in no eventthe Guaranty of Completion, seek any completion guaranty required pursuant to enforce Borrower’s obligation to pay Section 5.23 and the Indebtedness or other personal judgments against BorrowerCooperation Agreement.
(b) Borrower shall indemnify Lender and hold Lender harmless from and against any and all Damages to Lender (including the legal and other expenses of enforcing the obligations of Borrower under this Section and Sponsor under the Guaranty) to the extent resulting from or arising out of any of the followingfollowing (the "Indemnified Liabilities"), which Indemnified Liabilities shall be guaranteed by Sponsor pursuant to the Guaranty:
(i) any intentional or grossly negligent physical Waste at the Property committed or permitted by Borrower, Approved Music Venue Manager, Sponsor or any affiliate Controlled by Borrower and/or Sponsorof their respective affiliates;
(ii) any fraud or intentional misrepresentation in connection with the Loan committed by Borrower, Approved Music Venue Manager, Sponsor or any affiliate Controlled by Borrower and/or Sponsorof their respective affiliates;
(iii) any willful misconduct by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor (including any bad faith interference by BorrowerApproved Music Venue Manager, Sponsor or any affiliate Controlled of their respective affiliates (including (1) any litigation or other legal proceeding initiated by Borrower and/or Sponsor such Person in bad faith that delays, opposes impedes, obstructs, hinders, enjoins or otherwise interferes with or frustrates the efforts of Lender to exercise any rights and remedies available to Lender as provided herein and in the other Loan Documents during the continuance of an Event of DefaultDefault and (2) any refusal by Borrower to comply with Section 5.9 hereof);
(iv) the misappropriation or misapplication by Borrower, Approved Music Venue Manager, Sponsor or any affiliate Controlled by Borrower and/or Sponsor of their respective affiliates of any funds in violation of the Loan Documents (including misappropriation or misapplication of Revenues, security deposits and/or Loss Proceeds);
(v) any voluntary Debt incurred by Borrower or unauthorized Liens and encumbrances on the Collateral, if and to the extent the continued existence of such Debt is Debt, Liens and encumbrances are prohibited hereunder;
(vi) any breach by Borrower or Sponsor of any representation or covenant regarding environmental matters contained in this Agreement or in the Environmental Indemnity;
(vii) the failure to pay or maintain the Policies or pay the amount of any deductible required thereunder following a Casualty or other insurance claim, provided that current cash flow is sufficient and available pursuant to the Approved Management Agreement for payment of same and provided Lender permits cash flow from the Property to be applied for such purpose;
(viiviii) the failure of Borrower or Approved Music Venue Manager to be, and to at all times have been, a Single-Purpose Entity, regardless of whether such failure to have been a Single-Purpose Entity prior to the date hereof has been disclosed to Lender, and including any and all liabilities, contingent or otherwise, arising from or related to (x) the actions, conduct and/or operating history of Borrower or Approved Music Venue 49125-481/Block 21 (TX) Manager, as appropriate (or any Person merged into BorrowerBorrower or Approved Music Venue Manager, as appropriate) prior to the Closing Date and (y) Borrower’s 's or Approved Music Venue's ownership (or the ownership of any Person merged into BorrowerBorrower or Approved Music Venue Manager) of assets prior to the Closing Date that do not constitute a portion of the CollateralCollateral and/or the filing by any Person of a motion for substantive consolidation in bankruptcy citing any such failure (for the avoidance of doubt, the recourse described in this clause shall be in addition to the full recourse for a substantive consolidation described below);
(viiiix) removal of personal property by Borrower from the Property outside owned by Borrower, Approved Music Venue Manager or any of the ordinary course of business their affiliates during the continuance or in anticipation of an Event of Default in violation of the Loan AgreementDefault, unless replaced with personal property of the same utility and of the same or greater value and utility; and;
(ixx) any fees or commissions paid by Borrower or Approved Music Venue Manager to any affiliate in violation of the terms of the Loan Documents;
(xi) any transfer taxes resulting from Lender's exercise of remedies following any Event of Default;
(xii) the contesting or opposition by Borrower, Approved Music Venue Manager, Sponsor or any of their respective affiliates of any motion filed by Lender for relief from the automatic stay in any bankruptcy proceeding of any Required SPE;
(xiii) unauthorized Transfer of the Collateral (including unauthorized Liens and encumbrances on the Collateral) in violation of the Loan Documents and in any event subject to Borrower's right to contest any Liens in accordance with the terms of this Agreement; and
(xiv) if (i) either (A) the Approved Hotel Operating Agreement or the Approved Music Venue Lease (or the right to operate the applicable portion of the Property thereunder) shall be cancelled, surrendered or terminated by Borrower or any affiliate of Borrower, or by reason of any failure of Borrower or any affiliate of Borrower to perform its obligations in connection therewith and shall not be replaced as required hereunder upon the expiration, cancellation surrender or termination of the Approved Hotel Operating Agreement or the Approved Music Venue Lease, as appropriate, or (B) Borrower materially amends or modifies the Approved Hotel Operating Agreement or the Approved Music Venue Lease without the prior written consent of Lender. In addition to the foregoing, the Loan and all Indebtedness shall be fully recourse to Borrower and Sponsor, jointly and severally, if (i) there is any unauthorized Transfer of the Property or any other the Account Collateral (including voluntary unauthorized Liens and encumbrances on the Collateral other than Permitted EncumbrancesCollateral) or Prohibited Change of Control or Prohibited Pledge, in each case, in violation of the Loan DocumentsDocuments and in any event subject to Borrower's right to contest any Liens in accordance with the terms of this Agreement, (ii) any petition for bankruptcy, insolvency, dissolution or liquidation under the Bankruptcy Code or any similar federal or state law is filed by, consented to, or acquiesced in by, Borrower49125-481/Block 21 (TX) any Required SPE, (iii) Borrower any Required SPE or any of its their respective affiliates (including Sponsor) shall have colluded with other creditors to cause an involuntary filing under the Bankruptcy Code or similar federal or state law with respect to Borrowerany Required SPE, or Borrower any Required SPE shall have terminated one or more of the Independent Directors for the purpose of facilitating a bankruptcy filing, or (iv) Borrower any Required SPE fails to be, and to at all times have been, a Single-Purpose Entity, which failure (as determined by a court of competent jurisdiction cites as a contributing factor) results in a substantive consolidation of Borrower with any affiliate in a bankruptcy or similar proceeding. All of Borrower’s liabilities under this Section 9.19(b) shall be guaranteed by Sponsor pursuant to the Guaranty.
(c) The foregoing limitations on personal liability shall in no way impair or constitute a waiver of the validity of the Notes, the Indebtedness secured by the Collateral, or the Liens on the Collateral, or the right of Lender, as mortgagee or secured party, to foreclose and/or enforce its rights with respect to the Collateral after an Event of Default. Nothing in this Agreement shall be deemed to be a waiver of any right which Lender may have under the Bankruptcy Code to file a claim for the full amount of the debt owing to Lender by Borrower or to require that all Collateral shall continue to secure all of the Indebtedness owing to Lender in accordance with the Loan Documents. Lender may seek a judgment on the Note (and, if necessary, name Borrower in such suit) as part of judicial proceedings to foreclose on any Collateral or as a prerequisite to any such foreclosure or to confirm any foreclosure or sale pursuant to power of sale thereunder, and in the event any suit is brought on the Note(s)Notes, or with respect to any Indebtedness or any judgment rendered in such judicial proceedings, such judgment shall constitute a Lien on and may be enforced on and against the Collateral and the rents, profits, issues, products and proceeds thereof. Nothing in this Agreement shall impair the right of Lender to accelerate the maturity of the Note during upon the continuance occurrence of an Event of Default in accordance with the Loan DocumentsDefault, nor shall anything in this Agreement impair or be construed to impair the right of Lender to seek personal judgments, and to enforce all rights and remedies under applicable law, jointly and severally against any indemnitors and guarantors to the extent allowed by any applicable Loan Documents. The provisions set forth in this Section are not intended as a release or discharge of the obligations due under the Note or under any Loan Documents, but are intended as a limitation, to the extent provided in this Section, on Lender’s 's right to ▇▇▇ for a deficiency or seek a personal judgment except as required in order to realize on the Collateral.
(d) For the avoidance of doubt, the failure to pay trade payables as a result of insufficient cash flow from the Property shall not trigger liability under this Section 9.19.
Appears in 1 contract
Recourse. (a) Subject to the qualifications herein, Lender shall not enforce Borrower’s obligation to pay the Indebtedness by any action or proceeding wherein a deficiency judgment or other judgment establishing personal liability shall be sought against Borrower or any of its affiliates, or any Exculpated Person, except for foreclosure actions or any other appropriate actions or proceedings against Borrower in order to fully exercise Lender’s remedies in respect of, and to realize upon, the Collateral, and except for any actions to enforce any obligations expressly assumed or guaranteed by any guarantor, indemnitor or similar party (whether or not such party is an Exculpated Person) under the Loan Documents; provided however such foreclosure Documents or appropriate actions or proceedings against the obligations of Borrower shall, in no event, seek to enforce Borrower’s obligation to pay the Indebtedness or other personal judgments against Borrowerunder Section 9.19(b).
(b) Borrower shall indemnify Lender and hold Lender harmless from and against any and all Damages to Lender (including the legal and other expenses of enforcing the obligations of Borrower under this Section and Sponsor under the Guaranty) resulting from or arising out of any of the following:
(i) any intentional physical Waste at any of the Property Properties committed or permitted by Borrower, Sponsor Sponsor, Property Owner, Master Tenant or any affiliate Controlled of their respective affiliates; provided, however, that no liability shall result under this clause (i) (A) with respect to alterations made by Borrower, Property Owner or Master Tenant to any Property in accordance with Section 6.13 hereof or Section 6.13 of the Mortgage Loan Agreement or (B) if the Properties failed to generate sufficient cash flow to pay for maintenance and repairs at the applicable Property or if funds reserved by Lender or Mortgage Lender for such purpose have not been made available to Borrower and/or Sponsoror Property Owner by Lender or Mortgage Lender to pay such amounts;
(ii) any fraud or intentional misrepresentation in connection with the Loan committed by Borrower, Sponsor Sponsor, Property Owner, Master Tenant or any affiliate Controlled by Borrower and/or Sponsorof their respective affiliates;
(iii) any willful misconduct by Borrower, Sponsor Sponsor, Property Owner, Master Tenant or any affiliate Controlled by Borrower and/or Sponsor of their respective affiliates (including any litigation or other legal proceeding initiated by such Person in bad faith interference or which is determined by Borrowera court of competent jurisdiction to be frivolous that delays, Sponsor opposes, impedes, obstructs, hinders, enjoins or any affiliate Controlled by Borrower and/or Sponsor otherwise interferes with or frustrates the efforts of Lender to exercise any rights and remedies available to Lender as provided herein and in the other Loan Documents during the continuance of an Event of DefaultDefault (but in no event including any good faith defense asserted by Borrower, Sponsor, Property Owner or any of their respective Affiliates);
(iv) the misappropriation or intentional misapplication by Borrower, Sponsor Sponsor, Property Owner, Master Tenant or any affiliate Controlled by Borrower and/or Sponsor of their respective affiliates of any funds in violation of the Loan Documents or the Mortgage Loan Documents (including misappropriation or misapplication of Revenues, Master Lease Rent, security deposits and/or Loss Proceeds);
(v) any voluntary Debt incurred by Borrower or Property Owner (other than Permitted Debt) if and to the extent the continued existence of such Debt is prohibited hereunder, unless such Debt arises from an insufficiency of cash flow to pay such Debt;
(vi) any breach by Borrower, Property Owner or Sponsor of any representation or covenant regarding environmental matters contained in this Agreement, in the Mortgage Loan Documents or in the Environmental Indemnity (in each case beyond all applicable notice and cure periods set forth in the Loan Documents or the Mortgage Loan Documents);
(vii) failure of Property Owner to pay Taxes, charges for labor or materials or other charges that can create liens on any portion of any Property in accordance with the terms and provisions hereof; provided, however, that no liability shall result under this clause (vii) if (A) Lender or Mortgage Lender, as the case maybe, fails to permit cash flow from the Properties to be applied for such purpose or (B) if the Properties failed to generate sufficient cash flow to pay any such amounts when due;
(viii) failure of Property Owner to pay or maintain the Policies or pay the amount of any deductible required thereunder following a Casualty or other insurance claim; provided, provided however, that current cash flow is sufficient and available pursuant no liability shall result under this clause (viii) if (A) Lender or Mortgage Lender, as the case may be, fails to the Approved Management Agreement for payment of same and provided Lender permits permit cash flow from the Property Properties to be applied for such purposepurpose or (B) if the Properties failed to generate sufficient cash flow to pay any such amounts when due;
(viiix) the failure of Borrower or Property Owner to be, and to at all times have been, a Single-Purpose Entity, regardless of whether such failure to have been a Single-Purpose Entity prior to the date hereof has been disclosed to Lender, and including any and all liabilities, contingent or otherwise, arising from or related to (x) the actions, conduct and/or operating history of Borrower or Property Owner (or any Person merged into BorrowerBorrower or Property Owner) prior to the Closing Date and (y) Borrower’s or Property Owner’s, as the case may be, ownership (or the ownership of any Person merged into BorrowerBorrower or Property Owner) of assets prior to the Closing Date that do not constitute a portion of the CollateralCollateral or the Mortgage Loan Collateral and/or the filing by any Person of a motion for substantive consolidation in bankruptcy citing any such failure (for the avoidance of doubt, the recourse described in this clause shall be in addition to the full recourse for a substantive consolidation as described below); provided, however, that no liability shall result under this clause (ix) with respect to (A) failures to pay unsecured trade payables and operational debt incurred in the ordinary course of Borrower’s or Property Owner’s, as the case may be, business if there is insufficient case flow from the Properties (or if funds reserved by Lender or Mortgage Lender, as the case may be, for such purposes have not been made available to Borrower or Property Owner by Lender or Mortgage Lender, as the case may be, to pay such outstanding amounts) and (B) Sponsor is not obligated to fund additional capital to make any loans to Borrower or Property Owner;
(viiix) removal of personal property by Borrower from the Property outside any of the ordinary course of business Properties after the occurrence and during the continuance of an Event of Default in violation or Mortgage Loan Event of the Loan AgreementDefault, unless replaced with personal property of the same utility and of the same or greater value and utility; and;
(ixxi) any fees or commissions paid by Borrower or Property Owner to any affiliate in violation of the terms of the Loan Documents or the Mortgage Loan Documents;
(xii) transfer taxes resulting from Lender’s exercise of remedies following an Event of Default;
(xiii) the contesting or opposition by Borrower, Property Owner, Sponsor or any of their respective affiliates of any motion filed by Lender for relief from the automatic stay in any bankruptcy proceeding of Borrower or Property Owner;
(xiv) any material modification, termination, surrender, waiver or cancellation of any Ground Lease (including pursuant to a Fee Acquisition) in violation of the Loan Documents or the Mortgage Loan Documents;
(xv) except as expressly set forth below with respect to full recourse liability in the following paragraph in clause (i), any Transfer occurs in violation of the Loan Documents if such Transfer does not result in (A) a Prohibited Change of Control or (B) a voluntary Transfer of title to all or any portion of the Collateral or the fee title to the real estate comprising the Properties; and
(xvi) after a foreclosure (or conveyance-in-lieu of foreclosure) of the Collateral made pursuant to the Loan Documents, the failure of Borrower in bad faith to deliver to Lender all books and records with respect to the Properties then in the possession of Borrower. In addition to the foregoing, the Loan and all Indebtedness shall be fully recourse to Borrower and Sponsor, jointly and severally, if (i) there is any unauthorized Transfer occurs in violation of the Property or any other Collateral Loan Documents if such Transfer results in (including voluntary Liens and encumbrances on the Collateral other than Permitted EncumbrancesA) or a Prohibited Change of Control or Prohibited Pledge, in each case, in violation (B) a voluntary Transfer of title to all or any portion of the Loan DocumentsCollateral or the fee title to the real estate comprising the Properties, (ii) any petition for bankruptcy, insolvency, dissolution or liquidation under the Bankruptcy Code or any similar federal or state law is filed by, consented to, or acquiesced in by, BorrowerBorrower or Property Owner, (iii) Borrower or any of its affiliates Affiliates or Property Owner or any of its Affiliates (including Sponsor) shall have colluded with other creditors to cause an involuntary filing under the Bankruptcy Code or similar federal or state law with respect to BorrowerBorrower or Property Owner, or Borrower or Property Owner shall have terminated one or more of the Independent Directors for the purpose of facilitating a bankruptcy filing, or (iv) Borrower or Property Owner fails to be, and to at all times have been, a Single-Purpose Entity, which failure results in a substantive consolidation of Borrower or Property Owner with any affiliate in a bankruptcy or similar proceeding, or (v) any material modification, termination, surrender, waiver or cancellation of the Master Lease in violation of the Loan Documents or the Mortgage Loan Documents. All of Borrower’s liabilities under this Section 9.19(b) shall be guaranteed by Sponsor pursuant to the Guaranty.
(c) The foregoing limitations on personal liability shall in no way impair or constitute a waiver of the validity of the Notes, the Indebtedness secured by the Collateral, or the Liens on the Collateral, or the right of Lender, as mortgagee pledgee or secured party, to foreclose and/or enforce its rights with respect to the Collateral after an Event of Default. Nothing in this Agreement shall be deemed to be a waiver of any right which Lender may have under the Bankruptcy Code to file a claim for the full amount of the debt owing to Lender by Borrower or to require that all Collateral shall continue to secure all of the Indebtedness owing to Lender in accordance with the Loan Documents. Lender may seek a judgment on the Note (and, if necessary, name Borrower in such suit) as part of judicial proceedings to foreclose on any Collateral or as a prerequisite to any such foreclosure or to confirm any foreclosure or sale pursuant to power of sale thereunder, and in the event any suit is brought on the Note(s)Notes, or with respect to any Indebtedness or any judgment rendered in such judicial proceedings, such judgment shall constitute a Lien on and may be enforced on and against the Collateral and the rents, profits, issues, products and proceeds thereof. Nothing in this Agreement shall impair the right of Lender to accelerate the maturity of the Note during upon the continuance occurrence of an Event of Default in accordance with the Loan DocumentsDefault, nor shall anything in this Agreement impair or be construed to impair the right of Lender to seek personal judgments, and to enforce all rights and remedies under applicable law, jointly and severally against any indemnitors and guarantors to the extent allowed by any applicable Loan Documents. The provisions set forth in this Section are not intended as a release or discharge of the obligations due under the Note or under any Loan Documents, but are intended as a limitation, to the extent provided in this Section, on Lender’s right to ▇▇▇ for a deficiency or seek a personal judgment except as required in order to realize on the Collateral.
(d) For the avoidance of doubt, the failure to pay trade payables as a result of insufficient cash flow from the Property shall not trigger liability under this Section 9.19.
Appears in 1 contract
Recourse. (a) Subject to the qualifications herein, Lender shall not enforce Borrower’s obligation to pay the Indebtedness by any action or proceeding wherein a deficiency judgment or other judgment establishing personal liability shall be sought against Borrower or any of its affiliates, or any Exculpated Person, except for foreclosure actions or any other appropriate actions or proceedings against Borrower in order to fully exercise Lender’s remedies in respect of, and to realize upon, the Collateral, and except for any actions to enforce any obligations expressly assumed or guaranteed by any guarantor, indemnitor or similar party (whether or not such party is an Exculpated Person) under the Loan Documents; provided however such foreclosure or appropriate actions or proceedings against Borrower shall, in no event, seek to enforce Borrower’s obligation to pay the Indebtedness or other personal judgments against Borrower.
(b) Borrower (but not any Exculpated Person, except Sponsor) shall indemnify Lender and hold Lender harmless from and against any and all Damages to Lender (including the legal and other expenses of enforcing the obligations of Borrower under this Section and the Sponsor under the Guaranty) resulting from or arising out of any of the followingfollowing (the “Indemnified Liabilities”), which Indemnified Liabilities shall be guaranteed by Sponsor pursuant to the Guaranty:
(i) any intentional or grossly negligent material physical Waste at any of the Property Properties committed or permitted by Borrower, Operating Lessee, the Sponsor or any affiliate Controlled by Borrower and/or Sponsorof their respective affiliates;
(ii) any fraud or intentional willful misrepresentation in connection with the Loan committed by Borrower, Operating Lessee, the Sponsor or any affiliate Controlled by Borrower and/or Sponsorof their respective affiliates;
(iii) any willful misconduct by Borrower, Operating Lessee the Sponsor or any affiliate Controlled by Borrower and/or Sponsor of their respective affiliates (including any bad faith wrongful interference by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor such Person with the exercise any rights and of remedies available to by Lender as provided herein and in the other Loan Documents during the continuance of an Event of Default);
(iv) the misappropriation or intentional misapplication by Borrower, Operating Lessee, the Sponsor or any affiliate Controlled by Borrower and/or Sponsor of their respective affiliates of any funds in violation of the Loan Documents (Documents, including the failure to comply with the first sentence of Section 3.1(a) and misappropriation or intentional misapplication of Revenues, security deposits deposits, Loss Proceeds (to the extent not applied toward repayment of the Loan or restoration of any of the Properties pursuant to this Agreement) and/or Loss Proceeds)amounts contained in the Approved FF&E Account or Approved Operating Account;
(v) any voluntary Debt incurred by Borrower or Operating Lessee if and to the extent the continued existence of such Debt is prohibited hereunderhereunder (excluding , however, any Debt that constituted Permitted Debt on the date that it was incurred);
(vi) any breach by Borrower, Operating Lessee or the Sponsor of any representation or covenant regarding environmental matters contained in this Agreement or in the Environmental Indemnity;
(vii) the failure to pay or maintain the Policies or pay the amount of any deductible required thereunder following a Casualty or other insurance claim, provided that current cash flow is sufficient and available pursuant to the Approved Management Agreement for payment of same and provided Lender permits cash flow from the Property Properties is sufficient for such purpose (it being agreed that cash flow from the Properties shall be deemed to have been sufficient if cash flow during the immediately prior policy year would have been sufficient to accumulate sufficient funds in a reserve account to fully pay premiums for the Policies for the policy year in question, had Lender been reserving funds in respect of the Policies during such immediately prior policy year) and Lender permits the same to be applied for such purpose, (and neither Borrower nor Sponsor shall have an liability under this clause (vii) for Damages that arise from Lender’s failure to properly apply amounts reserved by Lender, if any, for the purpose of paying insurance premiums);
(viiviii) the failure of Borrower or Operating Lessee to be, and to at all times have been, a Single-Purpose EntityEntity (for the avoidance of doubt, regardless of whether such failure to have been a Single-Purpose Entity prior the recourse described in this clause shall be in addition to the date hereof has been disclosed to Lenderfull recourse for a substantive consolidation described below), and including any and all liabilities, contingent or otherwise, arising from or related to (x) except for the actions, conduct and/or operating history unilateral resignation of Borrower (or any Person merged into Borrower) prior to the Closing Date and (y) Borrower’s ownership (or the ownership of any Person merged into Borrower) of assets prior to the Closing Date that do not constitute a portion of the Collateralan Independent Director;
(viiiix) removal of personal property by Borrower or FF&E from the Property outside any of the ordinary course of business Properties during the continuance or in anticipation of an Event of Default in violation Default, except as a result of the Loan Agreement, obsolescence or unless replaced with personal property of the same utility and or FF&E of the same or greater value and utility; and;
(ixx) any fees or commissions paid by Borrower or Operating Lessee to any affiliate in violation of the terms of the Loan Documents;
(xi) the failure to fund either Approved FF&E Account in accordance with this Agreement (it being agreed that Damages in such event shall include the amount of any funds not deposited into the Approved FF&E Account), provided cash flow from the applicable Property is sufficient to fund the applicable Approved FF&E Account and Lender permits the same to be applied for such purpose;
(xii) the failure to convert the Hyatt Herald Square into a Hyatt branded hotel pursuant to the Capital Plan and for the same to be open for business as a “Hyatt” branded hotel, in each case, on or before June 30, 2015; and
(xiii) any claims or demands by Holiday Hospitality Franchising, Inc. as a result of the termination of the Holiday Inn Franchise Agreement. In addition to the foregoing, the Loan shall be fully recourse to Borrower and Sponsor, jointly and severally, if (i) there is any unauthorized Transfer of any of the Property Properties or any other unauthorized transfer of any Collateral (including voluntary Liens and encumbrances on Account, the Collateral other than Permitted Encumbrances) Approved Operating Account, the Approved FF&E Account or any Prohibited Change of Control or Prohibited PledgeControl, in each case, in violation of the Loan Documents, (ii) any petition for bankruptcy, insolvency, dissolution or liquidation under the Bankruptcy Code or any similar federal or state law is filed by, consented to, or acquiesced in by, Borrowerany Required SPE, (iii) Borrower any Required SPE or any of its their respective affiliates (including Sponsor) shall have colluded with other creditors to cause an involuntary bankruptcy filing under the Bankruptcy Code or similar federal or state law with respect to Borrower, or Borrower shall have terminated one or more of the Independent Directors for the purpose of facilitating a bankruptcy filingany Required SPE, or (iv) Borrower any Required SPE fails to be, and to at all times have been, ,
a Single-Purpose Entity, which failure results in a substantive consolidation of Borrower and/or Operating Lessee with any affiliate in a bankruptcy or similar proceeding. All of Borrower’s liabilities under this Section 9.19(b) The Loan shall be guaranteed by recourse to Sponsor pursuant in an amount equal to its unpaid Guaranteed Obligations (as such term is defined in the Completion Guaranty) under the Completion Guaranty.
(c) The foregoing limitations on personal liability shall in no way impair or constitute a waiver of the validity of the Notes, the Indebtedness secured by the Collateral, or the Liens on the Collateral, or the right of Lender, as mortgagee or secured party, to foreclose and/or enforce its rights with respect to the Collateral after an Event of Default. Nothing in this Agreement shall be deemed to be a waiver of any right which Lender may have under the Bankruptcy Code to file a claim for the full amount of the debt owing to Lender by Borrower or to require that all Collateral shall continue to secure all of the Indebtedness owing to Lender in accordance with the Loan Documents. Lender may seek a judgment on the Note (and, if necessary, name Borrower in such suit) as part of judicial proceedings to foreclose on any Collateral or as a prerequisite to any such foreclosure or to confirm any foreclosure or sale pursuant to power of sale thereunder, and in the event any suit is brought on the Note(s)Notes, or with respect to any Indebtedness or any judgment rendered in such judicial proceedings, such judgment shall constitute a Lien on and may be enforced on and against the Collateral and the rents, profits, issues, products and proceeds thereof. Nothing in this Agreement shall impair the right of Lender to accelerate the maturity of the Note during upon the continuance occurrence of an Event of Default in accordance with the Loan DocumentsDefault, nor shall anything in this Agreement impair or be construed to impair the right of Lender to seek personal judgments, and to enforce all rights and remedies under applicable law, jointly and severally against any indemnitors and guarantors to the extent allowed by any applicable Loan Documents. The provisions set forth in this Section are not intended as a release or discharge of the obligations due under the Note or under any Loan Documents, but are intended as a limitation, to the extent provided in this Section, on Lender’s right to ▇▇▇ for a deficiency or seek a personal judgment except as required in order to realize on the Collateral.
(d) For the avoidance of doubt, the failure to pay trade payables as a result of insufficient cash flow from the Property shall not trigger liability under this Section 9.19.
Appears in 1 contract
Recourse. (a) Subject to the qualifications hereinin Sections 9.19(b) and 9.19(c) below, Lender shall not enforce Borrower’s obligation to pay the Indebtedness by any action or proceeding wherein a deficiency judgment or other judgment establishing personal liability shall be sought against Borrower or any of its affiliates, or any Exculpated Person, except for foreclosure actions or any other appropriate actions or proceedings against Borrower with respect to the Collateral in order to fully exercise Lender’s remedies in respect of, and to realize upon, the Collateral, and except for any actions to enforce any obligations expressly assumed or guaranteed by Guarantor under the Guaranty, Unfunded Obligations Guaranty and Environmental Indemnity and Borrower under the Environmental Indemnity or any guarantor, indemnitor or similar party that becomes a party to any of the foregoing agreements or enters into any replacement guaranties or indemnities (whether or not such party is an Exculpated Person) under the Loan Documents; provided however such foreclosure or appropriate actions or proceedings against Borrower shall, in no event, seek to enforce Borrower’s obligation to pay the Indebtedness or other personal judgments against Borrower.
(b) Borrower shall indemnify Lender and hold Lender harmless from and against any and all Damages to Lender (including the reasonable legal and other expenses of enforcing the obligations of Borrower under this Section and Sponsor under the GuarantySection) resulting from or arising out of any of the following:following (the “Indemnified Liabilities”):
(i) any fraud or intentional physical Waste at the Property committed or permitted misrepresentation by Borrower, Sponsor Guarantor or any affiliate Controlled by Borrower and/or SponsorAffiliated agent of the foregoing;
(ii) any fraud intentional misapplication or intentional misrepresentation misappropriation of insurance proceeds, Loss Proceeds, Revenues or security deposits in connection with violation of the Loan committed by Borrower, Sponsor or any affiliate Controlled by Borrower and/or SponsorDocuments;
(iii) any willful misconduct by Borrowerwrongful removal, Sponsor destruction or any affiliate Controlled by Borrower and/or Sponsor (including any bad faith interference by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor with the exercise any rights and remedies available to Lender as provided herein and in the other Loan Documents during the continuance of an Event of Default);
(iv) the misappropriation or misapplication by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor material physical Waste of any funds in violation of the Loan Documents (including misappropriation or misapplication of Revenues, security deposits and/or Loss Proceeds);
(v) any voluntary Debt incurred by Borrower if and to the extent the continued existence of such Debt is prohibited hereunder;
(vi) the failure to pay or maintain the Policies or pay the amount of any deductible required thereunder following a Casualty or other insurance claim, provided that current cash flow is sufficient and available pursuant to the Approved Management Agreement for payment of same and provided Lender permits cash flow from the Property to be applied for such purpose;
(vii) the failure of Borrower to be, and to at all times have been, a Single-Purpose Entity, regardless of whether such failure to have been a Single-Purpose Entity prior to the date hereof has been disclosed to Lender, and including any and all liabilities, contingent or otherwise, arising from or related to (x) the actions, conduct and/or operating history of Borrower (or any Person merged into Borrower) prior to the Closing Date and (y) Borrower’s ownership (or the ownership of any Person merged into Borrower) of assets prior to the Closing Date that do not constitute a material portion of the Collateral;
(viiiiv) removal failure to apply Available Funds, if any, and if reserved by Lender for such purpose, made available to Borrower, toward payment of personal property by Borrower from any Taxes or charges (including charges for labor and materials) that create Liens on the Property outside of the ordinary course of business during the continuance of an Event of Default in violation of the Loan AgreementProperty, unless replaced (i) contested in good faith and otherwise in accordance with personal property of the same utility and of the same or greater value and utility; and
(ix) any fees or commissions paid by Borrower to any affiliate in violation of the terms of the Loan Documents. In addition Documents or (ii) resulting from Lender’s failure to the foregoing, the Loan shall be fully recourse to Borrower and Sponsor, jointly and severally, if (i) there is any unauthorized Transfer of the Property or any other Collateral (including voluntary Liens and encumbrances on the Collateral other than Permitted Encumbrances) or Prohibited Change of Control or Prohibited Pledge, in each case, in violation of make required disbursements from reserves maintained for such purpose under the Loan Documents;
(v) failure to apply Available Funds, (ii) any petition if any, and if reserved by Lender for bankruptcysuch purpose, insolvency, dissolution or liquidation under the Bankruptcy Code or any similar federal or state law is filed by, consented to, or acquiesced in by, Borrower, (iii) Borrower or any of its affiliates (including Sponsor) shall have colluded with other creditors to cause an involuntary filing under the Bankruptcy Code or similar federal or state law with respect made available to Borrower, or Borrower shall have terminated one or more toward payment of the Independent Directors insurance premiums and insurance deductibles unless resulting from Lender’s failure to make required disbursements from reserves maintained for the such purpose of facilitating a bankruptcy filing, or (iv) Borrower fails to be, and to at all times have been, a Single-Purpose Entity, which failure results in a substantive consolidation of Borrower with any affiliate in a bankruptcy or similar proceeding. All of Borrower’s liabilities under this Section 9.19(b) shall be guaranteed by Sponsor pursuant to the Guaranty.
(c) The foregoing limitations on personal liability shall in no way impair or constitute a waiver of the validity of the Notes, the Indebtedness secured by the Collateral, or the Liens on the Collateral, or the right of Lender, as mortgagee or secured party, to foreclose and/or enforce its rights with respect to the Collateral after an Event of Default. Nothing in this Agreement shall be deemed to be a waiver of any right which Lender may have under the Bankruptcy Code to file a claim for the full amount of the debt owing to Lender by Borrower or to require that all Collateral shall continue to secure all of the Indebtedness owing to Lender in accordance with the Loan Documents. Lender may seek a judgment on the Note (and, if necessary, name Borrower in such suit) as part of judicial proceedings to foreclose on any Collateral or as a prerequisite to any such foreclosure or to confirm any foreclosure or sale pursuant to power of sale thereunder, and in the event any suit is brought on the Note(s), or with respect to any Indebtedness or any judgment rendered in such judicial proceedings, such judgment shall constitute a Lien on and may be enforced on and against the Collateral and the rents, profits, issues, products and proceeds thereof. Nothing in this Agreement shall impair the right of Lender to accelerate the maturity of the Note during the continuance of an Event of Default in accordance with the Loan Documents, nor shall anything in this Agreement impair or be construed to impair the right of Lender to seek personal judgments, and to enforce all rights and remedies under applicable law, jointly and severally against any indemnitors and guarantors to the extent allowed by any applicable Loan Documents. The provisions set forth in this Section are not intended as a release or discharge of the obligations due under the Note or under any Loan Documents, but are intended as a limitation, to the extent provided in this Section, on Lender’s right to ▇▇▇ for a deficiency or seek a personal judgment except as required in order to realize on the Collateral.
(d) For the avoidance of doubt, the failure to pay trade payables as a result of insufficient cash flow from the Property shall not trigger liability under this Section 9.19.;
Appears in 1 contract
Sources: Loan Agreement (New York REIT, Inc.)
Recourse. (a) Subject Except as set forth in SECTION 9.19(b) (with respect to Borrower and Sponsor), in the qualifications hereinEnvironmental Indemnity, Lender in the Cooperation Agreement, in SECTION 5.18 (with respect to Borrower) and in SECTION 9.14 (with respect to Borrower and Sponsor), no recourse shall not enforce Borrower’s obligation to pay be had for the Indebtedness by against any action or proceeding wherein a deficiency judgment or other judgment establishing personal liability shall be sought against Affiliate of Borrower or any officer, director, employer, agent or direct or indirect partner or member of its affiliates, Borrower or any Exculpated Person, except for foreclosure actions or any such Affiliate and recourse to Borrower shall be limited to the Liens of Lender on the Property and the other appropriate actions or proceedings against Borrower in order to fully exercise Lender’s remedies in respect of, and to realize upon, the Collateral, and except for any actions to enforce any obligations expressly assumed or guaranteed by any guarantor, indemnitor or similar party (whether or not such party is an Exculpated Person) under the Loan Documents; provided however such foreclosure or appropriate actions or proceedings against Borrower shall, in no event, seek to enforce Borrower’s obligation to pay the Indebtedness or other personal judgments against Borrower.
(b) Borrower shall and the Sponsor (as evidenced by the Sponsor's signature below) agree to jointly and severally indemnify Lender and hold Lender harmless from and against any and all Damages to Lender (including the legal and other expenses of enforcing the obligations of the Borrower and the Sponsor under this Section and Sponsor under the GuarantySECTION 9.19(b)) resulting from or arising out of any of the following:following (the "INDEMNIFIED LIABILITIES"):
(i) any intentional physical Waste at with respect to the Property committed or permitted by Borrower, the Sponsor or any affiliate Controlled by Borrower and/or Sponsorof their respective Affiliates;
(ii) any fraud or intentional misrepresentation in connection with the Loan committed by Borrower, the Sponsor or any affiliate Controlled by Borrower and/or Sponsorof their respective Affiliates;
(iii) any willful misconduct by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor (including any bad faith interference by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor with the exercise any rights and remedies available to Lender as provided herein and in the other Loan Documents during the continuance of an Event of Default);
(iv) the misappropriation or misapplication by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor of any funds (in violation of the Loan Documents provisions hereof or applicable Legal Requirements) by Borrower, the Sponsor or any of their respective Affiliates of any funds (including misappropriation or misapplication of Revenues, security deposits and/or Loss ProceedsProceeds and the violation of the last sentence of SECTION 5.8(d));
(iv) any Transfer of Collateral or Change of Control which is prohibited hereunder; and
(v) any voluntary Debt incurred breach by Borrower if and to or the extent the continued existence of such Debt is prohibited hereunder;
(vi) the failure to pay or maintain the Policies or pay the amount Sponsor of any deductible required thereunder following a Casualty representation set forth in SECTION 4.28 of this Agreement or other insurance claim, provided that current cash flow is sufficient and available pursuant to the Approved Management Agreement for payment of same and provided Lender permits cash flow from the Property to be applied for such purpose;
(vii) the failure of Borrower to be, and to at all times have been, a Single-Purpose Entity, regardless of whether such failure to have been a Single-Purpose Entity prior to the date hereof has been disclosed to Lender, and including any and all liabilities, contingent or otherwise, arising from or related to (x) the actions, conduct and/or operating history of Borrower (or any Person merged into Borrower) prior to the Closing Date and (y) Borrower’s ownership (or the ownership of any Person merged into Borrower) covenants set forth in the Environmental Indemnity Agreement. In addition, upon the occurrence of assets prior to the Closing Date that do not constitute a portion of the Collateral;
(viii) removal of personal property any filing by Borrower from the Property outside of the ordinary course of business during the continuance of an Event of Default in violation of the Loan Agreement, unless replaced with personal property of the same utility and of the same or greater value and utility; and
(ix) any fees or commissions paid by Borrower to any affiliate in violation of the terms of the Loan Documents. In addition to the foregoing, the Loan shall be fully recourse to Borrower and Sponsor, jointly and severally, if (i) there is any unauthorized Transfer of the Property or any other Collateral (including voluntary Liens and encumbrances on the Collateral other than Permitted Encumbrances) or Prohibited Change of Control or Prohibited Pledge, in each case, in violation of the Loan Documents, (ii) any petition for bankruptcy, insolvency, dissolution or liquidation under the Bankruptcy Code or any similar federal joining or state law is filed by, consented to, or acquiesced in by, Borrower, (iii) colluding by Borrower or any of its affiliates Affiliates (including Sponsor) shall have colluded with other creditors to cause in the filing of an involuntary filing case in respect of Borrower under the Bankruptcy Code Code, the entire Indebtedness shall become fully recourse to Borrower and shall be recourse to Sponsor in an amount equal to 10% of the Loan Amount.
(c) The liability of the Sponsor and the Borrower under SECTION 9.19(b) shall be direct and immediate and not conditional or similar federal contingent upon the pursuit of any remedies against Borrower or state law any other Person, nor against the Collateral, and shall not be impaired or 76 limited by any event, including, without limitation, the following events, in each case whether occurring with respect or without notice to the Sponsor or with or without consideration:
(i) any extensions of time for performance required by any of the Loan Documents or any extension or renewal of the Note;
(ii) any sale, assignment or foreclosure of the Note, the Deed of Trust or any of the other Loan Documents or any sale or transfer of any or all of the Property;
(iii) any change in the composition of Borrower including the withdrawal or removal of the Sponsor from any current or future position of ownership, management or control of Borrower;
(iv) the accuracy or inaccuracy of the representations made by Borrower in any of the Loan Documents;
(v) the release of Borrower or of any other Person from performance or observance of any of the agreements, covenants, terms or Borrower shall have terminated conditions contained in any of the Loan Documents by operation of law, Lender's voluntary act or otherwise; or
(vi) the modification of the terms of any one or more of the Independent Directors Loan Documents. The Sponsor acknowledges that Lender would not make the Loan but for the purpose personal liability undertaken by the Sponsor in this Agreement. The Sponsor agrees that it shall not demand or accept any payment from Borrower in respect of facilitating a bankruptcy filing, any amounts owing or (iv) Borrower fails to be, paid by the Sponsor hereunder until one year and to at all times one day after such time as the Indebtedness shall have been, a Single-Purpose Entity, which failure results been paid in a substantive consolidation of Borrower with any affiliate in a bankruptcy or similar proceeding. All of Borrower’s liabilities under this Section 9.19(b) shall be guaranteed by Sponsor pursuant to the Guarantyfull.
(cd) The foregoing limitations on personal liability shall in no way impair or constitute a waiver of the validity of the NotesNote, the Indebtedness secured by the Collateral, or the Liens on the Collateral, or the right of Lender, as mortgagee or secured party, to foreclose and/or enforce its rights with respect to the Collateral after an Event of Default. Nothing in this Agreement shall be deemed to be a waiver of any right which Lender may have under the United States Bankruptcy Code to file a claim for the full amount of the debt owing to Lender by Borrower or to require that all Collateral shall continue to secure all of the Indebtedness owing to Lender in accordance with the Loan Documents. Lender may seek a judgment on the Note (and, if necessary, name Borrower in such suit) as part of judicial proceedings to foreclose on under the Deed of Trust or to foreclose pursuant to any other Collateral Documents, or as a prerequisite to any such foreclosure or to confirm any foreclosure or sale pursuant to power of sale thereunder, and in the event any suit is brought on the Note(s)Note, or with respect to any Indebtedness or any judgment rendered in such judicial proceedings, such judgment shall constitute a Lien on and may will be and can be enforced on and against the Collateral and the rents, profits, issues, products and proceeds thereof. Nothing in this Agreement shall impair the right of the Lender to accelerate the maturity of the Note during upon the continuance occurrence of an Event of Default in accordance with the Loan DocumentsDefault, nor shall anything in this Agreement impair or be construed to impair the right of Lender to seek personal judgments, and to enforce all rights and remedies under applicable law, jointly and severally severally, against any indemnitors and guarantors to the extent allowed by any applicable Loan Documentsguarantees. The provisions set 77 forth in this Section SECTION 9.19 are not intended as a release or discharge of the obligations due under the Note or under any Loan Collateral Documents, but are intended as a limitation, to the extent provided in this Section, on Lender’s 's right to ▇▇▇ for a deficiency or seek a personal judgment except as required in order to realize on the Collateralagainst Borrower or Sponsor.
(d) For the avoidance of doubt, the failure to pay trade payables as a result of insufficient cash flow from the Property shall not trigger liability under this Section 9.19.
Appears in 1 contract
Sources: Loan Agreement (Las Vegas Sands Inc)
Recourse. (a) Subject Each of the Indemnitors agrees that the obligations of Indemnitors hereunder are separate, independent of and in addition to Indemnitors' respective obligations under the qualifications herein, Lender shall not enforce Borrower’s obligation to pay the Indebtedness by any action or proceeding wherein a deficiency judgment or other judgment establishing personal liability shall be sought against Borrower or any of its affiliates, or any Exculpated Person, except for foreclosure actions Loan Agreement or any other appropriate actions or proceedings against Borrower in order to fully exercise Lender’s remedies in respect of, and to realize upon, the Collateral, and except for any actions to enforce any obligations expressly assumed or guaranteed by any guarantor, indemnitor or similar party (whether or not such party is an Exculpated Person) under the Loan Documents; provided however such foreclosure or appropriate actions or proceedings against Borrower shall, in no event, seek to enforce Borrower’s obligation to pay the Indebtedness or other personal judgments against BorrowerDocument.
(b) Borrower Indemnitors agree that a separate action may be brought to enforce the provisions of this Indemnity, which shall indemnify in no way be deemed to be an action on the Obligations, whether or not the Lender and hold Group would be entitled to a deficiency judgment following a judicial foreclosure or sale under any Deed of Trust. Indemnitors waive any right to require that any action be brought by the Lender harmless from and Group against Indemnitors or any and all Damages to Lender (including the legal and other expenses of enforcing the obligations of Borrower under this Section and Sponsor Person, or that any other remedy under the Guaranty) resulting from or arising out of Loan Agreement, this Indemnity, any of the following:
(i) any intentional physical Waste at the Property committed or permitted by Borrowerother Loan Document, Sponsor or any affiliate Controlled other document entered into by Borrower and/or Sponsor;
(ii) any fraud or intentional misrepresentation Indemnitors in connection with the Loan committed by Borrowerforegoing be exercised. The Lender Group may, Sponsor at its option, proceed against Indemnitors in the first instance to collect monies when due or to obtain performance under this Indemnity, without first proceeding against Indemnitors or any affiliate Controlled by Borrower and/or Sponsor;
(iii) any willful misconduct by Borrower, Sponsor other indemnitors or any affiliate Controlled by Borrower and/or Sponsor (including other Person and without first resorting to any bad faith interference by Borrowerother indemnity, Sponsor or any affiliate Controlled by Borrower and/or Sponsor with the exercise any rights and remedies available to Lender as provided herein and in the other Loan Documents during the continuance of an Event of Default);
(iv) the misappropriation or misapplication by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor of any funds in violation of the Loan Documents (including misappropriation or misapplication of Revenues, security deposits and/or Loss Proceeds);
(v) any voluntary Debt incurred by Borrower if and to the extent the continued existence of such Debt is prohibited hereunder;
(vi) the failure to pay or maintain the Policies or pay the amount of any deductible required thereunder following a Casualty or other insurance claim, provided that current cash flow is sufficient and available pursuant to the Approved Management Agreement for payment of same and provided Lender permits cash flow from the Property to be applied for such purpose;
(vii) the failure of Borrower to be, and to at all times have been, a Single-Purpose Entity, regardless of whether such failure to have been a Single-Purpose Entity prior to the date hereof has been disclosed to Lender, and including any and all liabilities, contingent or otherwise, arising from or related to (x) the actions, conduct and/or operating history of Borrower (or any Person merged into Borrower) prior to the Closing Date and (y) Borrower’s ownership (or the ownership of any Person merged into Borrower) of assets prior to the Closing Date that do not constitute a portion of the Collateral;
(viii) removal of personal property by Borrower from the Property outside of the ordinary course of business during the continuance of an Event of Default in violation of the Loan Agreement, unless replaced with personal property of the same utility and of the same or greater value and utility; and
(ix) this Indemnity, any fees or commissions paid by Borrower to any affiliate in violation of the terms of the Loan Documents. In addition to the foregoingDocument, the Loan shall be fully recourse to Borrower and Sponsor, jointly and severally, if (i) there is any unauthorized Transfer of the Property or any other Collateral (including voluntary Liens and encumbrances on document entered into by Indemnitors in connection with the Collateral foregoing or any other than Permitted Encumbrances) or Prohibited Change of Control or Prohibited Pledge, in each case, in violation of remedy under the Loan DocumentsAgreement, (ii) this Indemnity, any petition for bankruptcyLoan Document, insolvency, dissolution or liquidation under the Bankruptcy Code or any similar federal or state law is filed by, consented to, or acquiesced other document entered into by Indemnitors in by, Borrower, (iii) Borrower or any of its affiliates (including Sponsor) shall have colluded connection with other creditors to cause an involuntary filing under the Bankruptcy Code or similar federal or state law with respect to Borrower, or Borrower shall have terminated one or more of the Independent Directors for the purpose of facilitating a bankruptcy filing, or (iv) Borrower fails to be, and to at all times have been, a Single-Purpose Entity, which failure results in a substantive consolidation of Borrower with any affiliate in a bankruptcy or similar proceeding. All of Borrower’s liabilities under this Section 9.19(b) shall be guaranteed by Sponsor pursuant to the Guarantyforegoing.
(c) The foregoing limitations on personal liability shall in no way impair or constitute a waiver This Indemnity is not given as additional security for the Obligations and is entirely independent of the validity Obligations (except as provided in Section 5), and shall not be measured or affected by any amounts at any time owing under the other Loan Documents, the sufficiency or insufficiency of any collateral (including without limitation the Premises) given to the Lender Group to secure repayment of the NotesObligations, or the Indebtedness consideration given by the Lender Group or any other party in order to acquire the Premises or any portion thereof. None of the obligations of Indemnitors hereunder shall be in any way secured by the Collateral, or the Liens on the Collateral, or the right of Lender, as mortgagee or secured party, to foreclose and/or enforce its rights with respect to the Collateral after an Event of Default. Nothing in this Agreement shall be deemed to be a waiver of any right which Lender may have under the Bankruptcy Code to file a claim for the full amount lien of the debt owing to Lender by Borrower or to require that all Collateral shall continue to secure all Deed of the Indebtedness owing to Lender in accordance with the Loan Documents. Lender may seek a judgment on the Note (and, if necessary, name Borrower in such suit) as part of judicial proceedings to foreclose on any Collateral or as a prerequisite to any such foreclosure or to confirm any foreclosure or sale pursuant to power of sale thereunder, and in the event any suit is brought on the Note(s), or with respect to any Indebtedness Trust or any judgment rendered in such judicial proceedings, such judgment shall constitute a Lien on and may be enforced on and against the Collateral and the rents, profits, issues, products and proceeds thereof. Nothing in this Agreement shall impair the right of Lender to accelerate the maturity of the Note during the continuance of an Event of Default in accordance with the other Loan Documents, nor shall anything in this Agreement impair or be construed to impair the right of Lender to seek personal judgments, and to enforce all rights and remedies under applicable law, jointly and severally against any indemnitors and guarantors to the extent allowed by any applicable Loan Documents. The provisions set forth in this Section are not intended as a release or discharge of the obligations due under the Note or under any Loan Documents, but are intended as a limitation, to the extent provided in this Section, on Lender’s right to ▇▇▇ for a deficiency or seek a personal judgment except as required in order to realize on the CollateralDocument.
(d) For the avoidance of doubt, the failure to pay trade payables as a result of insufficient cash flow from the Property shall not trigger liability under this Section 9.19.
Appears in 1 contract
Recourse. (a) Subject to the qualifications hereinin Sections 9.19(b) and 9.19(c) below, Lender shall not enforce Borrower’s obligation to pay the Indebtedness by any action or proceeding wherein a deficiency judgment or other judgment establishing personal liability shall be sought against Borrower or any of its affiliates, or any Exculpated Person, except for foreclosure actions or any other appropriate actions or proceedings against Borrower with respect to the Collateral in order to fully exercise Lender’s remedies in respect of, and to realize upon, the Collateral, and except for any actions to enforce any obligations expressly assumed or guaranteed by Guarantor under the Guaranty, Unfunded Obligations Guaranty and Environmental Indemnity and Borrower under the Environmental Indemnity or any guarantor, indemnitor or similar party that becomes a party to any of the foregoing agreements or enters into any replacement guaranties or indemnities (whether or not such party is an Exculpated Person) under the Loan Documents; provided however such foreclosure or appropriate actions or proceedings against Borrower shall, in no event, seek to enforce Borrower’s obligation to pay the Indebtedness or other personal judgments against Borrower.
(b) Borrower shall indemnify Lender and hold Lender harmless from and against any and all Damages to Lender (including the reasonable legal and other expenses of enforcing the obligations of Borrower under this Section and Sponsor under the GuarantySection) resulting from or arising out of any of the following:following (the “Indemnified Liabilities”):
(i) any fraud or intentional physical Waste at the Property committed or permitted misrepresentation by Borrower, Sponsor Mortgage Borrower, Guarantor or any affiliate Controlled by Borrower and/or SponsorAffiliated agent of the foregoing;
(ii) any fraud intentional misapplication or intentional misrepresentation misappropriation of insurance proceeds, Loss Proceeds, Revenues or security deposits in connection with violation of the Mortgage Loan committed by Borrower, Sponsor Documents or any affiliate Controlled by Borrower and/or SponsorLoan Documents;
(iii) any willful misconduct by Borrowerwrongful removal, Sponsor destruction or any affiliate Controlled by Borrower and/or Sponsor (including any bad faith interference by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor with the exercise any rights and remedies available to Lender as provided herein and in the other Loan Documents during the continuance of an Event of Default);
(iv) the misappropriation or misapplication by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor material physical Waste of any funds in violation of the Loan Documents (including misappropriation or misapplication of Revenues, security deposits and/or Loss Proceeds);
(v) any voluntary Debt incurred by Borrower if and to the extent the continued existence of such Debt is prohibited hereunder;
(vi) the failure to pay or maintain the Policies or pay the amount of any deductible required thereunder following a Casualty or other insurance claim, provided that current cash flow is sufficient and available pursuant to the Approved Management Agreement for payment of same and provided Lender permits cash flow from the Property to be applied for such purpose;
(vii) the failure of Borrower to be, and to at all times have been, a Single-Purpose Entity, regardless of whether such failure to have been a Single-Purpose Entity prior to the date hereof has been disclosed to Lender, and including any and all liabilities, contingent or otherwise, arising from or related to (x) the actions, conduct and/or operating history of Borrower (or any Person merged into Borrower) prior to the Closing Date and (y) Borrower’s ownership (or the ownership of any Person merged into Borrower) of assets prior to the Closing Date that do not constitute a material portion of the Collateral;
(viiiiv) removal failure to apply Available Funds, if any, and if reserved by Mortgage Lender or Lender for such purpose, made available to Borrower, toward payment of personal property by Borrower from any Taxes or charges (including charges for labor and materials) that create Liens on the Property outside of the ordinary course of business during the continuance of an Event of Default in violation of the Loan AgreementProperty, unless replaced (i) contested in good faith and otherwise in accordance with personal property of the same utility and of the same or greater value and utility; and
(ix) any fees or commissions paid by Borrower to any affiliate in violation of the terms of the Loan Documents. In addition to the foregoing, the Loan shall be fully recourse to Borrower and Sponsor, jointly and severally, if (i) there is any unauthorized Transfer of the Property Documents or any other Collateral (including voluntary Liens and encumbrances on the Collateral other than Permitted Encumbrances) or Prohibited Change of Control or Prohibited Pledge, in each case, in violation of the Loan Documents, (ii) any petition resulting from Mortgage Lender or Lender’s failure to make required disbursements from reserves maintained for bankruptcy, insolvency, dissolution or liquidation such purpose under the Bankruptcy Code Mortgage Loan Documents or any similar federal Loan Documents;
(v) failure to apply Available Funds, if any, and if reserved by Mortgage Lender or state law is filed byLender for such purpose, consented to, or acquiesced in by, Borrower, (iii) Borrower or any of its affiliates (including Sponsor) shall have colluded with other creditors to cause an involuntary filing under the Bankruptcy Code or similar federal or state law with respect made available to Borrower, or Borrower shall have terminated one or more toward payment of the Independent Directors insurance premiums and insurance deductibles unless resulting from Lender’s failure to make required disbursements from reserves maintained for the such purpose of facilitating a bankruptcy filing, or (iv) Borrower fails to be, and to at all times have been, a Single-Purpose Entity, which failure results in a substantive consolidation of Borrower with any affiliate in a bankruptcy or similar proceeding. All of Borrower’s liabilities under this Section 9.19(b) shall be guaranteed by Sponsor pursuant to the Guaranty.
(c) The foregoing limitations on personal liability shall in no way impair or constitute a waiver of the validity of the Notes, the Indebtedness secured by the Collateral, or the Liens on the Collateral, or the right of Lender, as mortgagee or secured party, to foreclose and/or enforce its rights with respect to the Collateral after an Event of Default. Nothing in this Agreement shall be deemed to be a waiver of any right which Lender may have under the Bankruptcy Code to file a claim for the full amount of the debt owing to Lender by Borrower Mortgage Loan Documents or to require that all Collateral shall continue to secure all of the Indebtedness owing to Lender in accordance with the Loan Documents. Lender may seek a judgment on the Note (and, if necessary, name Borrower in such suit) as part of judicial proceedings to foreclose on any Collateral or as a prerequisite to any such foreclosure or to confirm any foreclosure or sale pursuant to power of sale thereunder, and in the event any suit is brought on the Note(s), or with respect to any Indebtedness or any judgment rendered in such judicial proceedings, such judgment shall constitute a Lien on and may be enforced on and against the Collateral and the rents, profits, issues, products and proceeds thereof. Nothing in this Agreement shall impair the right of Lender to accelerate the maturity of the Note during the continuance of an Event of Default in accordance with the Loan Documents, nor shall anything in this Agreement impair or be construed to impair the right of Lender to seek personal judgments, and to enforce all rights and remedies under applicable law, jointly and severally against any indemnitors and guarantors to the extent allowed by any applicable Loan Documents. The provisions set forth in this Section are not intended as a release or discharge of the obligations due under the Note or under any Loan Documents, but are intended as a limitation, to the extent provided in this Section, on Lender’s right to ▇▇▇ for a deficiency or seek a personal judgment except as required in order to realize on the Collateral.
(d) For the avoidance of doubt, the failure to pay trade payables as a result of insufficient cash flow from the Property shall not trigger liability under this Section 9.19.;
Appears in 1 contract
Recourse. (a) Subject to Except as set forth in Section 9.19(b), in the qualifications hereinRecourse Guaranty, Lender in the Sponsor Guaranty in the Environmental Indemnities and in Section 5.19 and in Section 9.14, no recourse shall not enforce Borrower’s obligation to pay be had for the Indebtedness by or for the performance or observation of any action other obligation under this Agreement or proceeding wherein a deficiency judgment or other judgment establishing personal liability shall be sought any of the Loan Documents against any affiliate of Borrower or any officer, director, partner or equityholder of its affiliates, Borrower or any Exculpated Person, except for foreclosure actions or any such affiliate and recourse to Borrower shall be limited to the Liens of Lender on the Properties and the other appropriate actions or proceedings against Borrower in order to fully exercise Lender’s remedies in respect of, and to realize upon, the Collateral, and except for any actions to enforce any obligations expressly assumed or guaranteed by any guarantor, indemnitor or similar party (whether or not such party is an Exculpated Person) under the Loan Documents; provided however such foreclosure or appropriate actions or proceedings against Borrower shall, in no event, seek to enforce Borrower’s obligation to pay the Indebtedness or other personal judgments against Borrower.
(b) Borrower shall indemnify Lender and hold Lender harmless from and against any and all Damages to Lender (including the legal and other expenses of enforcing the obligations of Borrower under this Section and Sponsor under the Guaranty9.19) resulting from or arising out of any of the following:following (the “Indemnified Liabilities”):
(i) any intentional physical Waste at the Property committed or permitted by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor;
(ii) any fraud or intentional misrepresentation committed by Borrower, the Sponsor, any Operating Lessee or any of their respective affiliates in connection with the Loan committed by Borrower, Sponsor or any affiliate Controlled by Borrower and/or SponsorLoan;
(iii) any willful misconduct by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor (including any bad faith interference by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor with the exercise any rights and remedies available to Lender as provided herein and in the other Loan Documents during the continuance of an Event of Default);
(ivii) the misappropriation or misapplication by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor of any funds (in violation of the Loan Documents Documents) by Borrower, any Operating Lessee, the Sponsor or any of their respective affiliates of any funds (including misappropriation or misapplication of Revenues, security deposits deposits, sales proceeds and/or Loss ProceedsProceeds and the violation of the last sentence of Section 5.7(d));
(viii) any voluntary Debt incurred by Borrower if and to the extent the continued existence Transfer of such Debt Collateral or voluntary Lien which is prohibited hereunder;
(viiv) any breach by Borrower, any Operating Lessee or the failure to pay or maintain the Policies or pay the amount Sponsor of any deductible required thereunder following a Casualty representation or other insurance claim, provided that current cash flow is sufficient and available pursuant to covenant regarding environmental matters contained in this Agreement or in the Approved Management Agreement for payment of same and provided Lender permits cash flow from the Property to be applied for such purposeEnvironmental Indemnity Agreements;
(viiv) the failure occurrence of any filing by Borrower to be, and to at all times have been, a Single-Purpose Entity, regardless of whether such failure to have been a Single-Purpose Entity prior to the date hereof has been disclosed to Lender, and including any and all liabilities, contingent or otherwise, arising from or related to (x) the actions, conduct and/or operating history of Borrower (or any Person merged into Borrower) prior to the Closing Date and (y) Borrower’s ownership (or the ownership of any Person merged into Borrower) of assets prior to the Closing Date that do not constitute a portion of the Collateral;
(viii) removal of personal property by Borrower from the Property outside of the ordinary course of business during the continuance of an Event of Default in violation of the Loan Agreement, unless replaced with personal property of the same utility and of the same or greater value and utility; and
(ix) any fees or commissions paid by Borrower to any affiliate in violation of the terms of the Loan Documents. In addition to the foregoing, the Loan shall be fully recourse to Borrower and Sponsor, jointly and severally, if (i) there is any unauthorized Transfer of the Property or any other Collateral (including voluntary Liens and encumbrances on the Collateral other than Permitted Encumbrances) or Prohibited Change of Control or Prohibited Pledge, in each case, in violation of the Loan Documents, (ii) any petition for bankruptcy, insolvency, dissolution or liquidation Operating Lessee under the Bankruptcy Code or any similar federal joining or state law is filed by, consented to, or acquiesced in by, colluding by Borrower, (iii) Borrower any Operating Lessee or any of its their respective affiliates (including Sponsor) shall have colluded with other creditors to cause in the filing of an involuntary filing case in respect of Borrower or any Operating Lessee under the Bankruptcy Code or similar federal or state law with respect Code;
(vi) any material failure of Borrower to Borrower, or Borrower shall have terminated one or more of the Independent Directors for the purpose of facilitating a bankruptcy filing, or (iv) Borrower fails to be, and to at all times have been, be a Single-Purpose Entity; and
(vii) any intentional physical waste with respect to any Property committed or permitted by Borrower, which failure results in a substantive consolidation any Operating Lessee, the Sponsor or any of Borrower with any affiliate in a bankruptcy or similar proceeding. All of Borrower’s liabilities under this Section 9.19(b) shall be guaranteed by Sponsor pursuant to the Guarantytheir respective affiliates.
(c) The foregoing limitations on personal liability shall in no way impair or constitute a waiver of the validity of the Notes, the Indebtedness secured by the Collateral, or the Liens on the Collateral, or the right of Lender, as mortgagee or secured party, to foreclose and/or enforce its rights with respect to the Collateral after an Event of Default. Nothing in this Agreement shall be deemed to be a waiver of any right which Lender may have under the Bankruptcy Code to file a claim for the full amount of the debt owing to Lender by Borrower or to require that all Collateral shall continue to secure all of the Indebtedness owing to Lender in accordance with the Loan Documents. Lender may seek a judgment on the Note (and, if necessary, name Borrower in such suit) as part of judicial proceedings to foreclose on under the Mortgage or to foreclose pursuant to any Collateral other Loan Documents, or as a prerequisite to any such foreclosure or to confirm any foreclosure or sale pursuant to power of sale thereunder, and in the event any suit is brought on the Note(s)Notes, or with respect to any Indebtedness or any judgment rendered in such judicial proceedings, such judgment shall constitute a Lien on and may will be and can be enforced on and against the Collateral and the rents, profits, issues, products and proceeds thereof. Nothing in this Agreement shall impair the right of Lender to accelerate the maturity of the Note during upon the continuance occurrence of an Event of Default in accordance with the Loan DocumentsDefault, nor shall anything in this Agreement impair or be construed to impair the right of Lender to seek personal judgments, and to enforce all rights and remedies under applicable law, jointly and severally law against any indemnitors and guarantors (including Sponsors) to the extent allowed by any applicable Loan Documentsguarantees (including the Recourse Guaranty). The provisions set forth in this Section 9.19 are not intended as a release or discharge of the obligations due under the Note or under any Loan Collateral Documents, but are intended as a limitation, to the extent provided in this SectionSection 9.19, on Lender’s right to ▇s▇▇ for a deficiency or seek a personal judgment except as required in order to realize on the Collateralagainst Borrower or Sponsors.
(d) For the avoidance of doubt, the failure to pay trade payables as a result of insufficient cash flow from the Property shall not trigger liability under this Section 9.19.
Appears in 1 contract
Sources: Loan Agreement (American Casino & Entertainment Properties LLC)
Recourse. (a) Subject to the qualifications herein, Lender shall not enforce Borrower’s obligation to pay the Indebtedness by any action or proceeding wherein a deficiency judgment or other judgment establishing personal liability shall be sought against Borrower or any of its affiliates, or any Exculpated Person, except for foreclosure actions or any other appropriate actions or proceedings against Borrower in order to fully exercise Lender’s remedies in respect of, and to realize upon, the Collateral, and except for any actions to enforce any obligations expressly assumed or guaranteed by any guarantor, indemnitor or similar party (whether or not such party is an Exculpated Person) under the Loan Documents; provided however such foreclosure or appropriate actions or proceedings against Borrower shall, in no event, seek to enforce Borrower’s obligation to pay the Indebtedness or other personal judgments against Borrower.
(b) Borrower shall indemnify Lender and hold Lender harmless from and against any and all Damages to Lender (including the legal and other expenses of enforcing the obligations of Borrower under this Section and the Sponsor and ▇▇▇▇▇▇ and Associates under the Guaranty) resulting from or arising out of any of the followingfollowing (the “Indemnified Liabilities”), which Indemnified Liabilities shall be guaranteed by Sponsor and ▇▇▇▇▇▇ and Associates pursuant to the Guaranty:
(i) any intentional material physical Waste at the Property committed or permitted by Borrower, the Sponsor or any affiliate Controlled by Borrower and/or Sponsorof their respective affiliates;
(ii) any fraud or intentional willful misrepresentation in connection with the Loan committed by Borrower, the Sponsor or any affiliate Controlled by Borrower and/or Sponsorof their respective affiliates;
(iii) any willful misconduct by Borrower, the Sponsor or any affiliate Controlled by Borrower and/or Sponsor of their respective affiliates (including any bad faith wrongful interference by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor such Person with the exercise any rights and of remedies available to by Lender as provided herein and in the other Loan Documents during the continuance of an Event of Default);
(iv) the misappropriation or misapplication by Borrower, the Sponsor or any affiliate Controlled by Borrower and/or Sponsor of their respective affiliates of any funds in violation of the Loan Documents (including misappropriation or misapplication of Revenues, security deposits and/or Loss Proceeds);
(v) any voluntary Debt incurred by Borrower if and to the extent the continued existence of such Debt is prohibited hereunder;
(vi) any breach by Borrower or the Sponsor of any representation or covenant regarding environmental matters contained in this Agreement or in the Environmental Indemnity;
(vii) the failure to pay or maintain the Policies or pay the amount of any deductible required thereunder following a Casualty or other insurance claim, provided that current cash flow is sufficient and available pursuant to the Approved Management Agreement for payment of same and provided Lender permits cash flow from the Property to be applied for such purpose;
(viiviii) the failure of Borrower to be, and to at all times have been, a Single-Purpose EntityEntity (for the avoidance of doubt, regardless of whether such failure to have been a Single-Purpose Entity prior the recourse described in this clause shall be in addition to the date hereof has been disclosed to Lender, and including any and all liabilities, contingent or otherwise, arising from or related to (x) the actions, conduct and/or operating history of Borrower (or any Person merged into Borrower) prior to the Closing Date and (y) Borrower’s ownership (or the ownership of any Person merged into Borrower) of assets prior to the Closing Date that do not constitute full recourse for a portion of the Collateralsubstantive consolidation described below);
(viiiix) removal of personal property by Borrower from the Property outside of the ordinary course of business during the continuance or in anticipation of an Event of Default in violation of the Loan AgreementDefault, unless replaced with personal property of the same utility and of the same or greater value and utility; and;
(ixx) any fees or commissions paid by Borrower to any affiliate in violation of the terms of the Loan Documents. In addition ;
(xi) any bankruptcy of any Required SPE, provided that, for this purpose “Damages” shall be limited to the foregoing, amount by which such costs and expenses exceed the Loan shall be fully recourse to Borrower costs and Sponsor, jointly and severally, if (i) there is any unauthorized Transfer of expenses Lender would have incurred in an uncontested foreclosure on the Property or any other Collateral (including voluntary Liens and encumbrances on the Collateral other than Permitted Encumbrances) or Prohibited Change of Control or Prohibited Pledge, in each case, in violation of the Loan Documents, (ii) any petition for bankruptcy, insolvency, dissolution or liquidation under the Bankruptcy Code or any similar federal or state law is filed by, consented to, or acquiesced in by, Borrower, (iii) Borrower or any of its affiliates (including Sponsor) shall have colluded with other creditors to cause an involuntary filing under the Bankruptcy Code or similar federal or state law with respect to Borrower, or Borrower shall have terminated one or more of the Independent Directors for the purpose of facilitating a bankruptcy filing, or (iv) Borrower fails to be, and to at all times have been, a Single-Purpose Entity, which failure results in a substantive consolidation of Borrower with any affiliate in a bankruptcy or similar proceeding. All of Borrower’s liabilities under this Section 9.19(b) shall be guaranteed by Sponsor pursuant to the Guaranty.
(c) The foregoing limitations on personal liability shall in no way impair or constitute a waiver of the validity of the Notes, the Indebtedness secured by the Collateral, or the Liens on the Collateral, or the right of Lender, as mortgagee or secured party, to foreclose and/or enforce its rights with respect to the Collateral after an Event of Default. Nothing in this Agreement shall be deemed to be a waiver of any right which Lender may have under the Bankruptcy Code to file a claim for the full amount of the debt owing to Lender by Borrower or to require that all Collateral shall continue to secure all of the Indebtedness owing to Lender in accordance with the Loan Documents. Lender may seek a judgment on the Note (and, if necessary, name Borrower in such suit) as part of judicial proceedings to foreclose on any Collateral or as a prerequisite to any such foreclosure or to confirm any foreclosure or sale pursuant to power of sale thereunder, and in the event any suit is brought on the Note(s), or with respect to any Indebtedness or any judgment rendered in such judicial proceedings, such judgment shall constitute a Lien on and may be enforced on and against the Collateral and the rents, profits, issues, products and proceeds thereof. Nothing in this Agreement shall impair the right of Lender to accelerate the maturity of the Note during the continuance of an Event of Default in accordance with the Loan Documents, nor shall anything in this Agreement impair or be construed to impair the right of Lender to seek personal judgments, and to enforce all rights and remedies under applicable law, jointly and severally against any indemnitors and guarantors to the extent allowed by any applicable Loan Documents. The provisions set forth in this Section are not intended as a release or discharge of the obligations due under the Note or under any Loan Documents, but are intended as a limitation, to the extent provided in this Section, on Lender’s right to ▇▇▇ for a deficiency or seek a personal judgment except as required in order to realize on the Collateral.
(d) For the avoidance of doubt, the recourse described in this clause shall be in addition to the full recourse for a substantive consolidation described below);
(xii) any transfer taxes resulting from Lender’s exercise of remedies following an Event of Default; and
(xiii) Borrower’s failure to pay trade payables any tenant improvement allowance to Catholic Health Initiatives for a Power Upgrade (as a result defined in the CHI Lease) as required pursuant to the terms of insufficient cash flow from the Property shall not trigger liability under this Section 9.19.8.4.2
Appears in 1 contract
Sources: Loan Agreement (Carter Validus Mission Critical REIT, Inc.)
Recourse. (a) Subject Notwithstanding any provisions of Section 10.1, Borrower shall be personally liable to Lender and Lender shall have full recourse to Borrower to the qualifications herein, Lender shall not enforce Borrower’s obligation to pay extent provided below in connection with the Indebtedness by any action or proceeding wherein a deficiency judgment or other judgment establishing personal liability and the Loan and nothing above shall be sought against Borrower or any deemed to constitute a waiver of its affiliates, or any Exculpated Person, except for foreclosure actions or any other appropriate actions or proceedings against Borrower in order to fully exercise Lender’s remedies in respect of, and to realize upon, the Collateral, and except for any actions rights of Lender to enforce any obligations expressly assumed or guaranteed by any guarantor, indemnitor or similar party (whether or not such party is an Exculpated Person) under the Loan Documents; provided however such foreclosure or appropriate actions or proceedings against Borrower shall, in no event, seek to enforce Borrower’s liability and obligation to pay the Indebtedness or other personal judgments against Borrower.
(b) Borrower shall indemnify Lender and hold Lender harmless from and against any and all Damages to Lender (including the legal and other expenses of enforcing the obligations of Borrower under the terms of this Section Agreement, by money judgment or otherwise, for the payment and Sponsor under the Guaranty) resulting from or arising out satisfaction of any all of the following:
(a) All losses, damages and costs incurred by Lender, or any subsequent holder of the Note, arising from any of the following acts by or on behalf of Borrower:
(i) any intentional physical Waste at misrepresentation by or on behalf of Borrower in connection with the Property committed or permitted by Borrower, Sponsor or any affiliate Controlled by Borrower and/or SponsorLoan except if covered under Section 10.2(b)(ii);
(ii) any fraud or intentional misrepresentation misappropriation of funds in connection with violation of specific provisions of the Loan committed by BorrowerDocuments, Sponsor including without limitation: (i) any use of Revenues generated after a default under the Loan Documents for purposes other than payment of Eligible Expenses and amounts due under the Loan Documents, and (ii) the use or any affiliate Controlled by Borrower and/or Sponsordisbursement of Revenues which itself constitutes a default under the Loan Documents;
(iii) any willful misconduct by Borroweruse of Loss Recoveries, Sponsor or any affiliate Controlled by Borrower and/or Sponsor (including any bad faith interference by Borrowerlease termination payments, Sponsor or any affiliate Controlled by Borrower and/or Sponsor with real property tax refunds and tenant security deposits for purposes other than as designated pursuant to the exercise any rights and remedies available to Lender as provided herein and in the other Loan Documents during the continuance of an Event of Default)Documents;
(iv) failure to cause all Revenues to be promptly deposited into the misappropriation or misapplication by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor of any funds Blocked Account in violation accordance with the requirements of the Loan Documents (including misappropriation or misapplication of Revenues, security deposits and/or Loss Proceeds)Documents;
(v) any voluntary Debt incurred by physical waste or damage affecting the Property resulting from the intentional acts of Borrower if and to the extent the continued existence of such Debt is prohibited hereunderor its agents;
(vi) the failure to pay Impositions prior to delinquency or maintain Premiums as required to keep the Policies or pay the amount of any deductible required thereunder following a Casualty or other insurance claim, provided that current cash flow is sufficient and available Collateral insured pursuant to this Agreement except to the Approved Management Agreement for payment of same and provided Lender permits cash flow from the Property to be applied for such purpose;
(vii) the failure of Borrower to be, and to at all times have been, a Single-Purpose Entity, regardless of whether such failure to extent that amounts have been a Single-Purpose Entity prior to the date hereof has been disclosed to Lender, and including any and all liabilities, contingent or otherwise, arising from or related to (x) the actions, conduct and/or operating history of Borrower (or any Person merged into Borrower) prior to the Closing Date and (y) Borrower’s ownership (or the ownership of any Person merged into Borrower) of assets prior to the Closing Date that do not constitute a portion of the Collateral;
(viii) removal of personal property by Borrower from the Property outside of the ordinary course of business during the continuance of an Event of Default deposited with Lender in violation of the Loan Agreement, unless replaced accordance with personal property of the same utility and of the same or greater value and utility; and
(ix) any fees or commissions paid by Borrower to any affiliate in violation of the terms of the Loan Documents. In addition ;
(vii) any fees, payments or disbursements paid to any Affiliate of Borrower or Guarantor after receipt of any written notice from Lender of default by or on behalf of Borrower or Guarantor under the Loan Documents (or which fee, payment or disbursement itself constitutes a default under the Loan Documents) and during the period that said default remains uncured pursuant to the foregoing, the Loan shall be fully recourse to Borrower and Sponsor, jointly and severally, if (i) there is any unauthorized Transfer of the Property or any other Collateral (including voluntary Liens and encumbrances on the Collateral other than Permitted Encumbrances) or Prohibited Change of Control or Prohibited Pledge, in each case, in violation terms of the Loan Documents;
(viii) any attempt by Borrower, Guarantor or any other Upstream Owner during an Event of Default to contest or materially delay any foreclosure suit, any suit on the Guaranty or any other exercise by Lender of its remedies under the Loan Documents, which attempts shall include, without limitation, any claim that any Loan Document is invalid or unenforceable to an extent that would preclude any such foreclosure or other exercise of such remedies except to the extent that Borrower or Guarantor prevails by final non appealable, judgement on the merits of a bona fide defense or compulsory counterclaim;
(ix) any violation by Borrower of the covenants contained in Section 5.1.7 of this Agreement; and
(x) any violation by Borrower of the covenants contained in Section 5.6 of this Agreement.
(b) All of the Indebtedness in the event of:
(i) any Transfer unless it is a Permitted Transfer;
(ii) any petition for bankruptcyfraud, insolvency, dissolution or liquidation under the Bankruptcy Code willful misconduct or any similar federal intentional misrepresentation by Borrower or state law is filed by, consented to, or acquiesced Guarantor in by, Borrower, connection with the Loan;
(iii) Borrower or any of its affiliates (including Sponsor) shall have colluded with other creditors to cause an involuntary filing under the Bankruptcy Code or similar federal or state law with respect to Borrower, or Borrower shall have terminated one or more of the Independent Directors for the purpose of facilitating a bankruptcy filing, or (iv) Borrower fails to be, and to at all times have been, a Single-Purpose Entity, which failure results in a substantive consolidation of Borrower or any Authorizing Entity with any affiliate other Person or entity in a bankruptcy connection with an Insolvency Proceeding, unless Lender petitions for or similar proceeding. All of Borrower’s liabilities under this Section 9.19(b) shall be guaranteed by Sponsor cooperates with (except pursuant to court order) a third party to effect such substantive consolidation; or
(1) the Guaranty.
commencement of an Insolvency Proceeding filed by Borrower or any Guarantor, (2) the commencement of an Insolvency Proceeding filed against Borrower or any Guarantor by (a) any Guarantor, (b) any Authorizing Entity, (c) The foregoing limitations on personal liability shall any other owner of an interest in no way impair or constitute a waiver of the validity of the Notes, the Indebtedness secured by the Collateral, or the Liens on the Collateral, or the right of Lender, as mortgagee or secured party, to foreclose and/or enforce its rights with respect to the Collateral after an Event of Default. Nothing in this Agreement shall be deemed to be a waiver of any right which Lender may have under the Bankruptcy Code to file a claim for the full amount of the debt owing to Lender by Borrower or to require that all Collateral shall continue to secure all of the Indebtedness owing to Lender in accordance with the Loan Documents. Lender may seek a judgment on the Note Guarantor (andcollectively, if necessary, name Borrower in such suit"Owner") as part of judicial proceedings to foreclose on any Collateral or as a prerequisite to any such foreclosure or to confirm any foreclosure or sale pursuant to power of sale thereunder, and in the event any suit is brought on the Note(s), or with respect to any Indebtedness or any judgment rendered in such judicial proceedings, such judgment shall constitute a Lien on and may be enforced on and against the Collateral and the rents, profits, issues, products and proceeds thereof. Nothing in this Agreement shall impair the right of Lender to accelerate the maturity of the Note during the continuance of an Event of Default in accordance with the Loan Documents, nor shall anything in this Agreement impair or be construed to impair the right of Lender to seek personal judgments, and to enforce all rights and remedies under applicable law, jointly and severally against any indemnitors and guarantors to the extent allowed by any applicable Loan Documents. The provisions set forth in this Section are not intended as a release or discharge of the obligations due under the Note or under any Loan Documents, but are intended as a limitation, to the extent provided in this Section, on Lender’s right to ▇▇▇ for a deficiency or seek a personal judgment except as required in order to realize on the Collateral.
(d) For any Affiliate of Borrower, Guarantor or an Owner, or (3) any filing by Borrower, any Guarantor, any Authorizing Entity, any Owner or any Affiliate of any such party consenting to or otherwise acquiescing in or joining in any Insolvency Proceeding against Borrower or any Guarantor brought by any third party. [The next page is the avoidance of doubt, the failure to pay trade payables as a result of insufficient cash flow from the Property shall not trigger liability under this Section 9.19.signature page]
Appears in 1 contract
Sources: Loan and Security Agreement (Stratus Properties Inc)
Recourse. (a) Subject to Except as expressly set forth in this Section 9.19, in Section 1.4(a), in Section 5.18, in Section 9.14, in the qualifications hereinEnvironmental Indemnity Agreement and in the Cooperation Agreement, Lender the Loan shall not enforce be recourse to Borrower’s obligation to pay the Indebtedness by any action or proceeding wherein a deficiency judgment or other judgment establishing personal liability . In addition, no recourse shall be sought had for the Loan against any other Person, including any affiliate of Borrower or any officer, director, partner or equityholder of its affiliates, Borrower or any Exculpated Personsuch affiliate, except for foreclosure actions or any other appropriate actions or proceedings against Borrower unless expressly set forth in order to fully exercise Lender’s remedies in respect of, and to realize upon, the Collateral, and except for any actions to enforce any obligations expressly assumed or guaranteed by any guarantor, indemnitor or similar party (whether or not such party is an Exculpated Person) under the a Loan Documents; provided however such foreclosure or appropriate actions or proceedings against Borrower shall, in no event, seek to enforce Borrower’s obligation to pay the Indebtedness Document or other personal judgments against Borrowerwritten agreement to which such Person is a party.
(b) Borrower shall indemnify Lender and hold Lender harmless from and against any and all Damages to Lender (including the legal and other expenses of enforcing the obligations of Borrower under this Section 9.19 and the Sponsor under the Guaranty) resulting from or arising out of any of the followingfollowing (the “Indemnified Liabilities”), which Indemnified Liabilities shall be guaranteed by Sponsor pursuant to the Guaranty:
(i) any intentional or grossly negligent physical Waste at with respect to the Property committed or permitted by Borrower, the Sponsor or any affiliate Controlled by Borrower and/or Sponsorof their respective affiliates;
(ii) any fraud fraud, willful misconduct or intentional misrepresentation in connection with the Loan committed by Borrower, the Sponsor or any affiliate Controlled by Borrower and/or Sponsorof their respective affiliates;
(iii) any willful misconduct by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor (including any bad faith interference by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor with the exercise any rights and remedies available to Lender as provided herein and in the other Loan Documents during the continuance of an Event of Default);
(iv) the misappropriation or misapplication by Borrower, the Sponsor or any affiliate Controlled by Borrower and/or Sponsor of their respective affiliates of any funds in violation of the Loan Documents (including misappropriation or misapplication of Revenues, security deposits and/or Loss ProceedsProceeds and the violation of the last sentence of Section 5.7(d));
(iv) any voluntary Debt if and to the extent prohibited hereunder (for these purposes, Debt will be regarded as voluntary if either incurred voluntarily or if not repaid by Borrower from available cash flow);
(v) any voluntary Debt incurred breach by Borrower if and to or the extent Sponsor of any representation or covenant regarding environmental matters contained in this Agreement or in the continued existence of such Debt is prohibited hereunderEnvironmental Indemnity;
(vi) any presence of mold on the Property arising due to Borrower’s failure to maintain the Property in accordance with the Loan Documents;
(vii) the failure to pay or maintain the Policies or pay the amount of any deductible required thereunder following a Casualty or other insurance claim, provided that current cash flow is sufficient and available pursuant to the Approved Management Agreement for payment of same and provided Lender permits cash flow from the Property to be applied for such purpose;
(vii) the failure of Borrower to be, and to at all times have been, a Single-Purpose Entity, regardless of whether such failure to have been a Single-Purpose Entity prior to the date hereof has been disclosed to Lender, and including any and all liabilities, contingent or otherwise, arising from or related to (x) the actions, conduct and/or operating history of Borrower (or any Person merged into Borrower) prior to the Closing Date and (y) Borrower’s ownership (or the ownership of any Person merged into Borrower) of assets prior to the Closing Date that do not constitute a portion of the Collateral;
(viii) removal of personal property by Borrower from the Property outside of the ordinary course of business during the continuance or in anticipation of an Event of Default in violation of the Loan AgreementDefault, unless replaced with personal property of the same utility and of the same or greater value and utility; and;
(ix) any fees or commissions paid by Borrower to any affiliate in violation of the terms of this Agreement;
(x) any bankruptcy of Borrower, provided that, for the Loan Documentspurpose of this clause (x) “Damages” shall be limited to the amount by which such costs and expenses exceed the costs and expenses Lender would have incurred in an uncontested foreclosure on the Property (for the avoidance of doubt, the recourse described in this clause (x) shall be in addition to the full recourse for bankruptcy described below); and
(xi) any amounts owed by Borrower from time to time pursuant to Section 5.14(b). In addition to the foregoing, the Loan shall be fully recourse to Borrower and Sponsor, jointly and severally, if upon (i) there is any unauthorized Transfer of the Property Collateral, voluntary or any other Collateral (including voluntary Liens and encumbrances collusive Lien on the Collateral other than Permitted Encumbrances) Collateral, or Prohibited Change of Control or Prohibited Pledge, in each case, in violation of the Loan DocumentsControl, (ii) the occurrence of any petition for bankruptcy, insolvency, dissolution or liquidation filing by Borrower under the Bankruptcy Code or any similar federal joining or state law is filed by, consented to, or acquiesced in by, Borrower, (iii) colluding by Borrower or any of its affiliates (including Sponsor) shall have colluded with other creditors to cause in the filing of an involuntary filing case in respect of Borrower under the Bankruptcy Code or similar federal or state law with respect to Borrower, or (iii) the failure of Borrower shall have terminated one or more of the Independent Directors for the purpose of facilitating a bankruptcy filing, or (iv) Borrower fails to be, and to at all times have been, a Single-Purpose Entity, which failure results in a substantive consolidation of Borrower with any affiliate in a bankruptcy or similar proceeding. All of Borrower’s liabilities under this Section 9.19(b) shall be guaranteed by Sponsor pursuant to the Guaranty.
(c) The foregoing limitations on personal liability shall in no way impair or constitute a waiver of the validity of the Notes, the Indebtedness secured by the Collateral, or the Liens on the Collateral, or the right of Lender, as mortgagee or secured party, to foreclose and/or enforce its rights with respect to the Collateral after an Event of Default. Nothing in this Agreement shall be deemed to be a waiver of any right which Lender may have under the Bankruptcy Code to file a claim for the full amount of the debt owing to Lender by Borrower or to require that all Collateral shall continue to secure all of the Indebtedness owing to Lender in accordance with the Loan Documents. Lender may seek a judgment on the Note (and, if necessary, name Borrower in such suit) as part of judicial proceedings to foreclose on any Collateral or as a prerequisite to any such foreclosure or to confirm any foreclosure or sale pursuant to power of sale thereunder, and in the event any suit is brought on the Note(s), or with respect to any Indebtedness or any judgment rendered in such judicial proceedings, such judgment shall constitute a Lien on and may be enforced on and against the Collateral and the rents, profits, issues, products and proceeds thereof. Nothing in this Agreement shall impair the right of Lender to accelerate the maturity of the Note during the continuance of an Event of Default in accordance with the Loan Documents, nor shall anything in this Agreement impair or be construed to impair the right of Lender to seek personal judgments, and to enforce all rights and remedies under applicable law, jointly and severally against any indemnitors and guarantors to the extent allowed by any applicable Loan Documents. The provisions set forth in this Section are not intended as a release or discharge of the obligations due under the Note or under any Loan Documents, but are intended as a limitation, to the extent provided in this Section, on Lender’s right to ▇▇▇ for a deficiency or seek a personal judgment except as required in order to realize on the Collateral.
(d) For the avoidance of doubt, the failure to pay trade payables as a result of insufficient cash flow from the Property shall not trigger liability under this Section 9.19.
Appears in 1 contract
Recourse. (a) Subject to Except for any indemnification by Borrower under this Agreement or any of the qualifications hereinother Loan Documents, Lender the Loan shall not enforce be recourse to Borrower’s obligation to pay the Indebtedness by any action or proceeding wherein a deficiency judgment or other judgment establishing personal liability . In addition, no recourse shall be sought had for the Loan against any other Person, including any affiliate of Borrower or any officer, director, partner or equityholder of its affiliates, Borrower or any Exculpated Personsuch affiliate, except for foreclosure actions or any other appropriate actions or proceedings against Borrower unless expressly set forth in order to fully exercise Lender’s remedies in respect of, and to realize upon, the Collateral, and except for any actions to enforce any obligations expressly assumed or guaranteed by any guarantor, indemnitor or similar party (whether or not such party is an Exculpated Person) under the a Loan Documents; provided however such foreclosure or appropriate actions or proceedings against Borrower shall, in no event, seek to enforce Borrower’s obligation to pay the Indebtedness Document or other personal judgments against Borrowerwritten agreement to which such Person is a party.
(b) Borrower shall indemnify Lender and hold Lender harmless from and against any and all Damages to Lender (including the legal and other expenses of enforcing the obligations of Borrower under this Section 9.19 and the Sponsor under the Guaranty) resulting from or arising out of any of the followingfollowing (the "Indemnified Liabilities"), which Indemnified Liabilities shall be guaranteed by Sponsor pursuant to the Guaranty:
(i) any intentional or grossly negligent physical Waste at with respect to the Property committed or permitted by Borrower, the Sponsor or any affiliate Controlled by Borrower and/or Sponsorof their respective affiliates;
(ii) any fraud or intentional misrepresentation in connection with the Loan committed by Borrower, the Sponsor or any affiliate Controlled by Borrower and/or Sponsorof their respective affiliates;
(iii) any willful misconduct by Borrower, the Sponsor or any affiliate Controlled by Borrower and/or Sponsor of their respective affiliates in violation of the Loan Documents (including any bad faith wrongful interference by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor such Person with the exercise any rights and of remedies available to by Lender as provided herein and in the other Loan Documents during the continuance of an Event of Default);
(iv) the misappropriation or misapplication by Borrower, the Sponsor or any affiliate Controlled by Borrower and/or Sponsor of their respective affiliates of any funds in violation of the Loan Documents (including misappropriation or misapplication of Revenues, security deposits and/or Loss ProceedsProceeds and the violation of the last sentence of Section 5.7(d));
(v) any voluntary Debt incurred by Borrower if and to the extent the continued existence of such Debt is prohibited hereunderhereunder (for these purposes, Debt will be regarded as voluntary if either incurred voluntarily or if not repaid by Borrower from available cash flow);
(vi) any breach by Borrower or the Sponsor of any representation or covenant regarding environmental matters contained in this Agreement or in the Environmental Indemnity;
(vii) the failure to pay or maintain the Policies or pay the amount of any deductible required thereunder following a Casualty or other insurance claim, provided that current cash flow is sufficient and available pursuant to the Approved Management Agreement for payment of same and provided Lender permits cash flow from the Property to be applied for such purpose;
(vii) the failure of Borrower to be, and to at all times have been, a Single-Purpose Entity, regardless of whether such failure to have been a Single-Purpose Entity prior to the date hereof has been disclosed to Lender, and including any and all liabilities, contingent or otherwise, arising from or related to (x) the actions, conduct and/or operating history of Borrower (or any Person merged into Borrower) prior to the Closing Date and (y) Borrower’s ownership (or the ownership of any Person merged into Borrower) of assets prior to the Closing Date that do not constitute a portion of the Collateral;
(viii) removal of personal property by Borrower from the Property outside of the ordinary course of business during the continuance or in anticipation of an Event of Default in violation of the Loan AgreementDefault, unless replaced with personal property of the same utility and of the same or greater value and utility; and;
(ix) any fees or commissions paid by Borrower to any affiliate in violation of the terms of the Loan Documents;
(x) any bankruptcy of Borrower, provided that, for the purpose of this clause (xi) "Damages" shall be limited to the amount by which such costs and expenses exceed the costs and expenses Lender would have incurred in an uncontested foreclosure on the Property (for the avoidance of doubt, the recourse described in this clause shall be in addition to the full recourse for bankruptcy described below);
(xi) any amounts owed by Borrower from time to time pursuant to Section 5.14(b);
(xii) any unauthorized Liens on the Collateral, provided there shall no liability hereunder to the extent either (a) the Property does not generate sufficient cash flow to avoid the occurrence of any such Liens or (b) the Liens relate to the failure to make any related payments which accrue after Borrower is no longer in possession or control of the Property as a result of foreclosure, deed in lieu of foreclosure, receivership or the exercise of other remedies under the Loan Documents; and
(xiii) any transfer by Borrower or Sponsor of any of the Collateral which is deemed personalty or intangibles in violation of the Loan Documents. In addition to the foregoing, the Loan shall be fully recourse to Borrower and Sponsor, jointly and severally, if upon (i) there is any unauthorized Transfer of the Property Property, any voluntary or any collusive pledge, Liens or other Collateral (including voluntary Liens and encumbrances on the Account Collateral other than Permitted Encumbrances) or Prohibited Change of Control or Prohibited PledgeControl, in each case, in violation of the Loan Documents, (ii) the occurrence of any petition for bankruptcy, insolvency, dissolution or liquidation filing by Borrower under the Bankruptcy Code or any similar federal joining or state law is filed by, consented to, or acquiesced in by, Borrower, (iii) colluding by Borrower or any of its affiliates (including Sponsor) shall have colluded with other creditors to cause in the filing of an involuntary filing case in respect of Borrower under the Bankruptcy Code or similar federal or state law with respect to Borrower, or (iii) the failure of Borrower shall have terminated one or more of the Independent Directors for the purpose of facilitating a bankruptcy filing, or (iv) Borrower fails to be, and to at all times have been, a Single-Purpose Entity, which failure results in a substantive consolidation of Borrower with any affiliate in a bankruptcy or similar proceeding. All proceeding (or the filing by Borrower, Sponsor, any affiliate or any third party of Borrower’s liabilities under this Section 9.19(b) a motion for substantive consolidation in bankruptcy citing any such failure or any filing; provided, however, as it relates solely to any filing by a third party hereunder, the Loan shall only be guaranteed by fully recourse to Borrower and Sponsor pursuant to the Guarantyextent Borrower or any of its affiliates (including Sponsor) joins in or colludes with the third party in making such filing).
(c) The foregoing limitations on personal liability shall in no way impair or constitute a waiver of the validity of the Notes, the Indebtedness secured by the Collateral, or the Liens on the Collateral, or the right of Lender, as mortgagee or secured party, to foreclose and/or enforce its rights with respect to the Collateral after an Event of Default. Nothing in this Agreement shall be deemed to be a waiver of any right which Lender may have under the Bankruptcy Code to file a claim for the full amount of the debt owing to Lender by Borrower or to require that all Collateral shall continue to secure all of the Indebtedness owing to Lender in accordance with the Loan Documents. Lender may seek a judgment on the Note (and, if necessary, name Borrower in such suit) as part of judicial proceedings to foreclose on under the Security Instrument or to foreclose pursuant to any Collateral other Loan Documents, or as a prerequisite to any such foreclosure or to confirm any foreclosure or sale pursuant to power of sale thereunder, thereunder and in the event any suit is brought on the Note(s)Notes, or with respect to any Indebtedness or any judgment rendered in such judicial proceedings, such judgment shall constitute a Lien on and may will be and can be enforced on and against the Collateral and the rents, profits, issues, products and proceeds thereof. Nothing in this Agreement shall impair the right of Lender to accelerate the maturity of the Note during upon the continuance occurrence of an Event of Default in accordance with the Loan DocumentsDefault, nor shall anything in this Agreement impair or be construed to impair the right of Lender to seek personal judgments, and to enforce all rights and remedies under applicable law, jointly and severally against any indemnitors and guarantors to the extent allowed by any applicable Loan Documentsguarantees. The provisions set forth in this Section 9.19 are not intended as a release or discharge of the obligations due under the Note or under any Loan Documents, but are intended as a limitation, to the extent provided in this Section, on Lender’s 's right to ▇▇▇ for a deficiency or seek a personal judgment against Borrower or Sponsor except as required in order to realize on the Collateral.
(d) For the avoidance of doubt, the failure to pay trade payables as a result of insufficient cash flow from the Property shall not trigger liability under this Section 9.19.
Appears in 1 contract
Recourse. (a) Subject to the qualifications herein, Lender shall not enforce Borrower▇▇▇▇▇▇▇▇’s obligation to pay the Indebtedness by any action or proceeding wherein a deficiency judgment or other judgment establishing personal liability shall be sought against Borrower or any of its affiliates, or any Exculpated Person, except for foreclosure actions or any other appropriate actions or proceedings against Borrower in order to fully exercise Lender’s remedies in respect of, and to realize upon, the Collateral, and except for any actions to enforce any obligations expressly assumed or guaranteed by any guarantor, indemnitor or similar party (whether or not such party is an Exculpated Person) under the Loan Documents; provided however such foreclosure Documents or appropriate actions or proceedings against the obligations of Borrower shall, in no event, seek to enforce Borrower’s obligation to pay the Indebtedness or other personal judgments against Borrowerunder Section 8.19(b).
(b) Borrower shall indemnify Lender and hold Lender harmless from and against any and all Damages to Lender (including the out-of-pocket legal and other expenses of enforcing the obligations of Borrower under this Section and Sponsor Guarantor under the Guaranty) resulting from or arising out of any of the following:
(i) any intentional material physical Waste at the Property committed or permitted by Borrower▇▇▇▇▇▇▇▇, Sponsor Guarantor or any affiliate Controlled of their respective Affiliates, provided, there shall not be any liability under this item (i) if funds are needed to prevent such Waste and there is insufficient cash flow generated by Borrower and/or Sponsorthe Property or Lender has not made the necessary funds available to prevent such Waste;
(ii) any fraud or intentional material misrepresentation committed by ▇▇▇▇▇▇▇▇, Guarantor or any of their respective Affiliates in connection with the Loan committed by Borrower, Sponsor or any affiliate Controlled by Borrower and/or SponsorLoan;
(iii) any willful misconduct by Borrower▇▇▇▇▇▇▇▇, Sponsor Guarantor or any affiliate Controlled by Borrower and/or Sponsor of their Affiliates (including (1) any litigation or other legal proceeding initiated by ▇▇▇▇▇▇▇▇, Guarantor or any of their Affiliates in bad faith interference by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor with the exercise any intent to and that so delays, opposes, impedes, obstructs, hinders, enjoins or otherwise interferes with the efforts of Lender to foreclose on the Collateral or to pursue other material rights and remedies available to Lender as provided herein and in under the other Loan Documents during the continuance of an a continuing Event of DefaultDefault and (2) entering into, amending, modifying or terminating the Ground Lease in violation of this Agreement or any other Loan Document);
(iv) the any misappropriation or misapplication by Borrower▇▇▇▇▇▇▇▇, Sponsor Guarantor or any affiliate Controlled by Borrower and/or Sponsor of their respective Affiliates of any funds or the Property in violation of the Loan Documents during a continuing Event of Default (including misappropriation or misapplication of Revenues, security deposits and/or Loss Proceeds), provided that, in no event will it be deemed misappropriation by Borrower, Guarantor or any of their respective Affiliates to the extent any of the foregoing are applied to pay Operating Expenses, Capital Expenditures, costs of Tenant Improvements and Leasing Commissions in accordance with the terms of the Loan Agreement or otherwise delivered to Lender;
(v) any voluntary Debt for borrowed money incurred by Borrower if ▇▇▇▇▇▇▇▇, or voluntary Lien granted by ▇▇▇▇▇▇▇▇, Guarantor or any of their Affiliates and to secured by the extent Collateral, in either case in violation of the continued existence of such Debt is prohibited hereunderLoan Documents (other than a Permitted Encumbrance), that does not trigger full recourse under clauses (A) or (B) below;
(vi) any conveyance of direct or indirect equity interests in Borrower in violation of the terms of the Loan Documents (in each case other than due to breach of notice or other administrative requirements);
(vii) any failure to pay the insurance premiums for, or maintain maintain, the Policies or pay the amount of any deductible required thereunder following a Casualty or other insurance claim, provided that current cash flow is sufficient and available pursuant to the Approved Management Agreement for payment of same and provided (x) Lender permits cash flow from the Property Properties to be applied for such purpose, and there is sufficient revenue generated by the Property for the purpose of paying for any applicable insurance premiums or deductibles and (y) there shall not be any liability hereunder to the extent there are adequate funds on deposit in the Basic Carrying Cost Account for the payment of insurance premiums and Lender fails to timely pay the applicable amounts when they are due and owing (provided Lender's access to such sums was not restricted or constrained in any manner);
(viiviii) the a material failure of Borrower a Required SPE to be, and to at all times have been, a Single-Purpose Entity, regardless or material misrepresentation of whether such failure to have been a Single-Purpose Entity prior to the date hereof has been disclosed to Lender, backwards looking representations and including any and all liabilities, contingent or otherwise, arising from or warranties contained in Section 4.17 related to (x) the actionsBorrower's prior history and operation as a single-purpose, conduct and/or operating history of Borrower (or any Person merged into Borrower) bankruptcy remote entity prior to the Closing Date and (y) Borrower’s ownership (or the ownership of any Person merged into Borrower) of assets prior to the Closing Date that do not constitute a portion of the CollateralDate;
(viiiix) removal any misappropriation of personal property any fees or commissions paid by Borrower from ▇▇▇▇▇▇▇▇, after the Property outside of the ordinary course of business occurrence and during the continuance of an Event of Default Default, to any Affiliate in violation of the Loan AgreementDocuments;
(x) any opposition in bad faith in a legal proceeding by Borrower or Guarantor to any motion filed by Lender for relief from the automatic stay in any bankruptcy proceeding of Borrower, unless replaced with personal property in each case as determined by a court of the same utility and of the same competent jurisdiction;
(xi) any Prohibited Equity Pledge or greater value and utilityProhibited Preferred Equity; and
(ixxii) any fees liability or commissions paid by obligation of Borrower to any affiliate in violation resulting from 11601 Wilshire Owner’s ownership of the terms of the Loan DocumentsPreviously Owned Property. In addition to the foregoing, the Loan shall be fully recourse to Borrower and SponsorGuarantor, jointly and severally, if in the event of (iA) there is any unauthorized voluntary Transfer of title to all of the Property or any other Collateral (including voluntary Liens and encumbrances on the Collateral other than Permitted Encumbrances) or Prohibited Change of Control or Prohibited Pledge, in each case, by Borrower in violation of the Loan Documents, (iiB) the incurrence of any voluntary Debt in the nature of a mortgage loan that includes a Lien against the Property or any mezzanine loan secured by the direct equity interests in Borrower undertaken in violation of the Loan Documents or any voluntary transfer of direct or indirect equity interests in Borrower that results in a Prohibited Change of Control, (C) the filing by any Required SPE of any voluntary petition for bankruptcy, insolvency, dissolution or liquidation under pursuant to the Bankruptcy Code or any similar federal or state law is filed by, consented to, (other than at the request or acquiesced in by, direction of Lender) (or the filing of any involuntary petition against Borrower if Borrower, (iii) Borrower Guarantor or any of its affiliates (including Sponsor) shall have their respective Affiliates colluded with, solicited, cause to be solicited or joined with other creditors to cause an involuntary filing under the Bankruptcy Code or similar federal or state law (other than Lender) in such filing); provided, that with respect to Borrowerthe foregoing clause (C), there shall be no liability for (x) failing to file an objection to any such filing and (y) providing a response in any such proceeding if such response is required by applicable law, rule or Borrower shall have terminated one or more of the Independent Directors for the purpose of facilitating a bankruptcy filing, court order; or (ivD) Borrower fails any Required SPE failing to be, and to at all times have been, a Single-Purpose Entity, which failure results is cited as a material factor in a substantive consolidation final judgment by a court of competent jurisdiction that substantively consolidates Borrower with any affiliate Affiliate of Borrower in a bankruptcy proceeding, provided, in no event will Borrower or similar proceedingany direct or indirect owner of Borrower be required to make capital contributions or provide other funds in order to avoid any liability under this clause (D). All of Borrower’s ▇▇▇▇▇▇▇▇'s liabilities under this Section 9.19(b8.19(b) shall be guaranteed by Sponsor Guarantor pursuant to the Guaranty subject to the terms and conditions thereof. Notwithstanding anything to the contrary contained herein or in the Guaranty, the maximum liability of Borrower and Guarantor in the event any of the items set forth in clauses (A) through (D), inclusive, of this paragraph, shall not exceed $100,000,000.
(c) The foregoing limitations on personal liability shall in no way impair or constitute a waiver of the validity of the Notes, the Indebtedness secured by the Collateral, or the Liens on the Collateral, or the right of Lender, as mortgagee or secured party, to foreclose and/or enforce its rights with respect to the Collateral after during the continuance of an Event of Default. Nothing in this Agreement shall be deemed to be a waiver of any right which Lender may have under the Bankruptcy Code to file a claim for the full amount of the debt owing to Lender by Borrower or to require that all Collateral shall continue to secure all of the Indebtedness owing to Lender in accordance with the Loan Documents. Lender may seek a judgment on the Note (and, if necessary, name Borrower in such suit) as part of judicial proceedings to foreclose on any Collateral or as a prerequisite to any such foreclosure or to confirm any foreclosure or sale pursuant to power of sale thereunder, and in the event any suit is brought on the Note(s)Notes, or with respect to any Indebtedness or any judgment rendered in such judicial proceedings, such judgment shall constitute a Lien on and may be enforced on and against the Collateral and the rents, profits, issues, products and proceeds thereof. Nothing in this Agreement shall impair the right of Lender to accelerate the maturity of the Note during upon the continuance occurrence of an Event of Default in accordance with the Loan DocumentsDefault, nor shall anything in this Agreement impair or be construed to impair the right of Lender to seek personal judgments, and to enforce all rights and remedies under applicable law, jointly and severally against any indemnitors and guarantors to the extent allowed by any applicable Loan Documents. The provisions set forth in this Section are not intended as a release or discharge of the obligations due under the Note or under any Loan Documents, but are intended as a limitation, to the extent provided in this Section, on Lender▇▇▇▇▇▇’s right to ▇▇▇ sue for a deficiency or seek a personal judgment except as required in order to realize on the Collateral.
(d) For the avoidance of doubt, the failure to pay trade payables as a result of insufficient cash flow from the Property shall not trigger liability under this Section 9.19.
Appears in 1 contract
Recourse. (a) Subject to the qualifications herein, Lender shall not enforce Borrower’s obligation to pay the Indebtedness by any action or proceeding wherein a deficiency judgment or other judgment establishing personal liability The Loan shall be sought fully recourse to Borrower. No recourse shall be had for the Loan against any other Person, including any Affiliate of Borrower or any officer, director, partner or equityholder of its affiliates, Borrower or any Exculpated Personsuch Affiliate, except for foreclosure actions or any other appropriate actions or proceedings (i) claims against Sponsor under the Guaranty and (ii) claims against Borrower in order to fully exercise Lender’s remedies in respect of, and to realize upon, the Collateral, and except for any actions to enforce any obligations expressly assumed or guaranteed by any guarantor, indemnitor or similar party (whether or not such party is an Exculpated Person) Sponsor under the Loan Documents; provided however such foreclosure or appropriate actions or proceedings against Borrower shall, in no event, seek to enforce Borrower’s obligation to pay the Indebtedness or other personal judgments against BorrowerEnvironmental Indemnity.
(b) Borrower shall indemnify Lender and hold Lender harmless from and against any and all Damages to Lender (including plus the legal and other expenses of enforcing the obligations of Borrower under this Section and Sponsor under the Guaranty9.19) resulting from or arising out of any of the followingfollowing (the “Indemnified Liabilities”), which Indemnified Liabilities shall be guaranteed by Sponsor, jointly and severally, pursuant to the Guaranty:
(i) any intentional material physical Waste at the with respect to any Property committed or permitted by Borrower, any Senior Mezzanine Borrower, the Sponsor or any affiliate Controlled by Borrower and/or Sponsorof their respective Affiliates;
(ii) any fraud fraud, willful misconduct or intentional material misrepresentation in connection with the Loan committed by Borrower, any Senior Mezzanine Borrower, the Sponsor or any affiliate Controlled by Borrower and/or Sponsorof their respective Affiliates;
(iii) any willful misconduct the misappropriation by Borrower, any Senior Mezzanine Borrower, the Sponsor or any affiliate Controlled by Borrower and/or Sponsor (including any bad faith interference by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor with the exercise any rights and remedies available to Lender as provided herein and in the other Loan Documents during the continuance of an Event of Default);
(iv) the misappropriation or misapplication by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor their respective Affiliates of any funds in violation of the Loan Documents (including misappropriation or misapplication of Revenues, Distributions, security deposits and/or Loss ProceedsProceeds and the violation of the last sentence of Section 5.7(d));
(iv) any breach by Borrower, any Senior Mezzanine Borrower or the Sponsor of any material representation or covenant regarding environmental matters contained in this Agreement or in the Environmental Indemnity;
(v) the failure of Borrower or any voluntary Debt incurred by Borrower if and Senior Mezzanine Borrower, at any time, to the extent the continued existence of such Debt is prohibited comply with Single-Purpose Entity requirements hereunder, in any material respect;
(vi) the any failure to pay income tax liabilities of non pass-through entities comprising Borrower any Senior Mezzanine Borrower or maintain the Policies or pay the amount of any deductible required thereunder following a Casualty or other insurance claim, provided that current cash flow is sufficient and available pursuant to the Approved Management Agreement for payment of same and provided Lender permits cash flow from the Property to be applied for such purposetheir respective Affiliates;
(vii) the failure of Borrower or any Senior Mezzanine Borrower to be, and to at all times have been, a Single-Purpose Entity, regardless of whether such failure to have been a Single-Purpose Entity fully discharge prior to the date hereof has been disclosed to Lender, and including Closing Date any and all liabilities, contingent or otherwise, arising from or related to (x) the actionsassociated with assets that were owned by Borrower, conduct and/or operating history of any Senior Mezzanine Borrower (or any Person merged into Borrower) of their respective Affiliates prior to the Closing Date (including all employee liabilities), other than the Properties and (y) Borrower’s ownership (direct or the ownership of any Person merged into Borrower) of assets prior to the Closing Date that do not constitute a portion of the Collateralindirect equity interests therein;
(viii) removal of personal property by Borrower from failure to structure and consummate the Property outside of the ordinary course of business during the continuance of an Event of Default Merger in violation of the Loan Agreement, unless replaced with personal property of the same utility and of the same or greater value and utility; anda manner that does not give rise to a shareholder lawsuit;
(ix) any fees liability of AFRT or commissions paid its subsidiaries under any recourse carveout under any Encumbered Property Debt, guaranty or similar obligations, in each case in respect of Borrower, any Senior Mezzanine Borrower, AFRT, Operating Partnership or any holding company;
(x) any failure by Borrower or Senior Mezzanine Borrower to cause each holder of Encumbered Property Debt to add Lender as a party to whom all notices of default must be given under the Encumbered Debt Documents; and any failure by Borrower to instruct each holder of Encumbered Property Debt to accept any affiliate payment from or action taken by Lender during the continuance of a default thereunder as if it were received from or performed by the applicable Property Owner; and any failure by Borrower to remit, or cause to be remitted, to any holder of Encumbered Property Debt any amount proffered by Lender in violation order to cure a default thereunder pursuant to Section 5.21;
(xi) any assumption fee, foreclosure fee or similar amount (and related expense reimbursements) owed by Lender or Senior Mezzanine Lender to any holder of Encumbered Property Debt or related loan servicer as a result of, or in order to permit, a foreclosure or transfer in lieu of foreclosure of Collateral; and
(xii) any failure of the terms of the Loan Documentsrepresentation made in Section 9.14 to be true and correct. In addition to the foregoing, foregoing (x) the Loan shall be fully recourse to Borrower and Sponsor, jointly and severally, if upon (i) there is any unauthorized Transfer of the Property Collateral or any other Property, voluntary or collusive Lien on Collateral (including voluntary Liens and encumbrances on the Collateral other than Permitted Encumbrances) or Prohibited any Property, or Change of Control which is prohibited hereunder or Prohibited Pledge, in each case, in violation of the Loan Documents, (ii) the occurrence of any petition for bankruptcyfiling by Borrower, insolvency, dissolution any Senior Mezzanine Borrower or liquidation Property Owner under the Bankruptcy Code or any similar federal joining or state law is filed by, consented to, or acquiesced in by, colluding by Borrower, (iii) any Senior Mezzanine Borrower or any of its affiliates their respective Affiliates (including Sponsor) shall have colluded with other creditors to cause in the filing of an involuntary filing case in respect of Borrower, any Senior Mezzanine Borrower or Property Owner under the Bankruptcy Code or similar federal or state law with respect to Borrower, or Borrower shall have terminated one or more of the Independent Directors for the purpose of facilitating a bankruptcy filing, or Code; and (ivy) Borrower fails to be, and to at all times have been, a Single-Purpose Entity, which failure results in a substantive consolidation of Borrower with any affiliate in a bankruptcy or similar proceeding. All of Borrower’s liabilities under this Section 9.19(b) shall be guaranteed by Sponsor pursuant to the Guaranty.
(c) The foregoing limitations on personal liability shall in no way impair or constitute a waiver of the validity of the Notes, the Indebtedness secured by the Collateral, or the Liens on the Collateral, or the right of Lender, as mortgagee or secured party, to foreclose and/or enforce its rights with respect to the Collateral after an Event of Default. Nothing in this Agreement shall be deemed to be a waiver of any right which Lender may have under the Bankruptcy Code to file a claim for the full amount of the debt owing to Lender by Borrower or to require that all Collateral shall continue to secure all of the Indebtedness owing to Lender in accordance with the Loan Documents. Lender may seek a judgment on the Note (and, if necessary, name Borrower in such suit) as part of judicial proceedings to foreclose on any Collateral or as a prerequisite to any such foreclosure or to confirm any foreclosure or sale pursuant to power of sale thereunder, and in the event any suit is brought on the Note(s)AFRT shall fail to comply with Section 5.24, or with respect to any Indebtedness or any judgment rendered in such judicial proceedings, such judgment shall constitute a Lien on and may be enforced on and against the Collateral and the rents, profits, issues, products and proceeds thereof. Nothing in this Agreement shall impair the right of Lender to accelerate the maturity of the Note during the continuance of an Event of Default in accordance with the Loan Documents, nor shall anything in this Agreement impair or be construed recourse to impair the right of Lender to seek personal judgments, AFRT and to enforce all rights and remedies under applicable lawSponsor, jointly and severally against any indemnitors and guarantors severally, in an amount equal to the extent allowed by any applicable Loan Documents. The provisions set forth in this Section are not intended as a release or discharge Release Price of the obligations due under the Note or under applicable Property, plus all related enforcement costs and any Loan Documents, but are intended as Damages resulting from a limitation, to the extent provided in this Section, on Lender’s right to ▇▇▇ for a deficiency or seek a personal judgment except as required in order to realize on the Collateral.
(d) For the avoidance of doubt, the failure to pay trade payables as a result of insufficient cash flow from the release such Property shall not trigger liability under this Section 9.19pursuant hereto.
Appears in 1 contract
Sources: Junior Mezzanine Loan Agreement (Gramercy Capital Corp)
Recourse. (a) Subject to Except for any indemnification by Obligor under this Agreement, the qualifications herein, Lender shall not enforce Borrower’s obligation to pay the Indebtedness by any action or proceeding wherein a deficiency judgment or other judgment establishing personal liability shall be sought against Borrower Maryland Guaranty or any of its affiliatesthe other Loan Documents, or any Exculpated Personthe Loan shall not be recourse to Maryland Guarantor and, except for foreclosure actions or any other appropriate actions or proceedings against Borrower in order subject to fully exercise Section 9.19(c), Lender’s remedies in respect ofrecourse shall be solely to Borrower, the Property and to realize upon, the Collateral, and except as set forth below. In addition, no recourse shall be had for any actions to enforce any obligations expressly assumed or guaranteed by any guarantor, indemnitor or similar party (whether or not such party is an Exculpated Person) under the Loan Documents; provided however against any other Person, including any affiliate of Obligor or any officer, director, partner or equityholder of Obligor or any such foreclosure or appropriate actions or proceedings against Borrower shallaffiliate, unless expressly set forth in no event, seek to enforce Borrower’s obligation to pay the Indebtedness a Loan Document or other personal judgments against Borrowerwritten agreement to which such Person is a party.
(b) Borrower Obligor shall indemnify Lender and hold Lender harmless from and against any and all Damages to Lender (including the legal and other expenses of enforcing the obligations of Borrower Obligor under this Section 9.19, Maryland Guarantor under the Maryland Guaranty and the Sponsor under the Guaranty and the Completion Guaranty) resulting from or arising out of any of the followingfollowing (the “Indemnified Liabilities”), which Indemnified Liabilities shall be guaranteed by Sponsor pursuant to the Guaranty:
(i) any intentional or grossly negligent physical Waste at with respect to the Property or FF&E committed or permitted by BorrowerObligor, Operating Lessee, the Sponsor or any affiliate Controlled by Borrower and/or Sponsorof their respective affiliates;
(ii) any fraud or intentional misrepresentation in connection with the Loan committed by BorrowerObligor, Operating Lessee, the Sponsor or any affiliate Controlled by Borrower and/or Sponsorof their respective affiliates;
(iii) any willful misconduct by BorrowerObligor, Operating Lessee, the Sponsor or any affiliate Controlled by Borrower and/or Sponsor of their respective affiliates in violation of the Loan Documents (including any bad faith wrongful interference by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor such Person with the exercise any rights and of remedies available to by Lender as provided herein and in the other Loan Documents during the continuance of an Event of Default);
(iv) the misappropriation or misapplication by BorrowerObligor, Operating Lessee, the Sponsor or any affiliate Controlled by Borrower and/or Sponsor of their respective affiliates of any funds in violation of the Loan Documents (including misappropriation or misapplication of Revenues, security deposits and/or Loss ProceedsProceeds and the violation of the last sentence of Section 5.7(d));
(v) any voluntary Debt incurred by Borrower prohibited hereunder, provided that, for the purpose of this clause (v), Debt will be regarded as voluntary if and to the extent the continued existence of such Debt is prohibited hereunderincurred voluntarily or incurred involuntarily and not repaid despite the availability of sufficient cash flow from the Property;
(vi) any breach by Obligor, Operating Lessee or the Sponsor of any representation or covenant regarding environmental matters contained in this Agreement or in the Environmental Indemnity;
(vii) the failure to pay or maintain the Policies or pay the amount of any deductible required thereunder following a Casualty or other insurance claim, provided that current cash flow is sufficient and available pursuant to the Approved Management Agreement for payment of same and provided Lender permits cash flow from the Property to be applied for such purpose;
(viiviii) the failure of Borrower any Obligor or Operating Lessee to be, and to at all times have been, a Single-Purpose Entity;
(ix) removal of personal property or FF&E from the Property during or in anticipation of an Event of Default, regardless unless replaced with personal property or FF&E, as applicable, of whether such failure the same utility and of the same or greater value and utility;
(x) any fees or commissions paid by Obligor or Operating Lessee to have been a Single-Purpose Entity prior any affiliate in violation of the terms of the Loan Documents;
(xi) any bankruptcy of any Obligor or Operating Lessee, provided that, for the purpose of this clause (xi) “Damages” shall be limited to the date hereof has been disclosed amount by which such costs and expenses exceed the costs and expenses Lender would have incurred in an uncontested foreclosure on the Property (for the avoidance of doubt, the recourse described in this clause shall be in addition to Lender, and including the full recourse for bankruptcy described below);
(xii) the failure of Maryland Guarantor to maintain the required account balance in the Maryland Guarantor FF&E Account (it being agreed that Damages in such event shall include the amount of any funds not deposited to the Maryland Guarantor FF&E Account);
(xiii) any and all liabilities, contingent or otherwise, arising from or related to (x) the actions, conduct and/or operating history of Borrower Obligor (or any Person merged into BorrowerObligor) prior to the Closing Date and (y) BorrowerObligor’s ownership (or the ownership of any Person merged into BorrowerObligor) of assets prior to the Closing Date that do not constitute a portion of the Collateral;
(viiixiv) removal the use of personal property by Borrower from an IDOT structure (i.e., the ownership of the Property outside of by Maryland Guarantor rather than by Borrower) in the ordinary course of business during the continuance of an Event of Default in violation origination of the Loan Agreement, unless replaced (it being agreed that Damages in such event shall include any increased costs and expenses of Lender in connection with personal property of foreclosure on the same utility and of Property due to the same or greater value and utilityIDOT structure); and
(ixxv) any fees breach by Maryland Guarantor or commissions paid by Borrower to Operating Lessee of any affiliate representation or covenant contained in violation the Subordination of the terms of the Loan DocumentsOperating Lease. In addition to the foregoing, the Loan shall be fully recourse to Borrower Obligor and Sponsor, jointly and severally, if upon (i) there is any unauthorized Transfer of the Property or Property, unauthorized transfer of any other of the Collateral (including voluntary unauthorized Liens and encumbrances on the Collateral other than Permitted EncumbrancesCollateral) or Prohibited Change of Control or Prohibited PledgeControl, in each case, in violation of the Loan Documents, (ii) the occurrence of any petition for bankruptcy, insolvency, dissolution filing by any Obligor or liquidation Operating Lessee under the Bankruptcy Code or any similar federal joining or state law is filed bycolluding by any Obligor, consented to, or acquiesced in by, Borrower, (iii) Borrower Operating Lessee or any of its their respective affiliates (including Sponsor) shall have colluded with other creditors to cause in the filing of an involuntary filing case in respect of any Obligor or Operating Lessee under the Bankruptcy Code (provided, however, that if such involuntary case is dismissed within 60 days of such filing the Loan shall not be fully recourse to Obligor and Sponsor, however Obligor and Sponsor shall indemnify Lender and hold Lender harmless from and against any and all Damages to Lender arising from or similar federal or state law with respect related to Borrower, or Borrower shall have terminated one or more the filing of the Independent Directors for the purpose of facilitating a bankruptcy filing, such involuntary case) or (iviii) Borrower fails the failure of any Obligor to be, and to at all times have been, a Single-Purpose Entity, which failure results in a substantive consolidation of Borrower such Obligor with any affiliate in a bankruptcy or similar proceedingproceeding (or the filing of a motion for substantive consolidation in bankruptcy citing any such failure, provided, however, that if such motion is dismissed within 60 days of filing the Loan shall not be fully recourse to Obligor and Sponsor, however Obligor and Sponsor shall indemnify Lender and hold Lender harmless from and against any and all Damages to Lender arising from or related to such motion). All of Borrower’s liabilities under this Section 9.19(b) The Loan shall be guaranteed by fully recourse to Sponsor pursuant in an amount equal to its unpaid Guaranteed Obligations (as such term is defined in the Completion Guaranty) under the Completion Guaranty.
(c) The foregoing limitations on personal liability shall in no way impair or constitute a waiver of the validity of the Notes, the Indebtedness secured by the Collateral, or the Liens on the Collateral, or the right of Lender, as mortgagee or secured party, to foreclose and/or enforce its rights with respect to the Collateral after an Event of Default. Nothing in this Agreement shall be deemed to be a waiver of any right which Lender may have under the Bankruptcy Code to file a claim for the full amount of the debt owing to Lender by Borrower or to require that all Collateral shall continue to secure all of the Indebtedness owing to Lender in accordance with the Loan Documents. Lender may seek a judgment on the Note (and, if necessary, name Borrower in such suit) as part of judicial proceedings to foreclose on under the Mortgage or to foreclose pursuant to any Collateral other Loan Documents, or as a prerequisite to any such foreclosure or to confirm any foreclosure or sale pursuant to power of sale thereunder, and in the event any suit is brought on the Note(s)Notes, or with respect to any Indebtedness or any judgment rendered in such judicial proceedings, such judgment shall constitute a Lien on and may will be and can be enforced on and against the Collateral and the rents, profits, issues, products and proceeds thereof. Nothing in this Agreement shall impair the right of Lender to accelerate the maturity of the Note during upon the continuance occurrence of an Event of Default in accordance with the Loan DocumentsDefault, nor shall anything in this Agreement impair or be construed to impair the right of Lender to seek personal judgments, and to enforce all rights and remedies under applicable law, jointly and severally against any indemnitors and guarantors to the extent allowed by any applicable Loan Documentsguarantees. The provisions set forth in this Section 9.19 are not intended as a release or discharge of the obligations due under the Note or under any Loan Documents, but are intended as a limitation, to the extent provided in this Section, on Lender’s right to ▇▇▇ for a deficiency or seek a personal judgment against Borrower or Sponsor except as required in order to realize on the Collateral.
(d) For the avoidance of doubt, the failure to pay trade payables as a result of insufficient cash flow from the Property shall not trigger liability under this Section 9.19.
Appears in 1 contract
Recourse. (a) Subject Except for any indemnification by Borrower under this Agreement or any of the other Loan Documents, the Loan shall not be recourse to Borrower and, subject to Section 9.19(c), Lender’s recourse shall be solely to the qualifications hereinProperty and the Collateral, Lender shall not enforce Borrower’s obligation to pay the Indebtedness by any action or proceeding wherein a deficiency judgment or other judgment establishing personal liability except as set forth below. In addition, no recourse shall be sought had for the Loan against any other Person, including any affiliate of Borrower or any officer, director, partner or equityholder of its affiliates, Borrower or any Exculpated Personsuch affiliate, except for foreclosure actions or any other appropriate actions or proceedings against Borrower unless expressly set forth in order to fully exercise Lender’s remedies in respect of, and to realize upon, the Collateral, and except for any actions to enforce any obligations expressly assumed or guaranteed by any guarantor, indemnitor or similar party (whether or not such party is an Exculpated Person) under the a Loan Documents; provided however such foreclosure or appropriate actions or proceedings against Borrower shall, in no event, seek to enforce Borrower’s obligation to pay the Indebtedness Document or other personal judgments against Borrowerwritten agreement to which such Person is a party.
(b) Borrower shall indemnify Lender and hold Lender harmless from and against any and all Damages to Lender (including the legal and other expenses of enforcing the obligations of Borrower under this Section 9.19 and the Sponsor under the Guaranty) resulting from or arising out of any of the followingfollowing (the “Indemnified Liabilities”), which Indemnified Liabilities shall be guaranteed by Sponsor pursuant to the Guaranty:
(i) any fraud or intentional physical Waste at the Property committed or permitted misrepresentation by Borrower, Operating Lessee, Sponsor or any affiliate Controlled by Borrower and/or SponsorAffiliate of Borrower, Operating Lessee or Sponsor in connection with the Property or the Loan;
(ii) the gross negligence or willful misconduct by Borrower, Operating Lessee, Sponsor or any fraud Affiliate of Borrower, Operating Lessee or intentional misrepresentation Sponsor in connection with the Loan committed by Borrower, Sponsor or any affiliate Controlled misconduct (including wrongful interference by Borrower and/or Sponsoror Operating Lessee with the exercise of remedies by Lender during an Event of Default, provided, however, the goof faith assertion of valid defenses shall not be deemed “wrongful”);
(iii) the breach of any willful misconduct by Borrowerrepresentation, Sponsor warranty, covenant or any affiliate Controlled by Borrower and/or Sponsor (including any bad faith interference by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor with the exercise any rights and remedies available to Lender as provided herein and indemnification provision in the other Loan Documents during environmental indemnity or in the continuance mortgage concerning environmental laws, hazardous substances and asbestos and any indemnification of an Event of Default)Lender with respect thereto in either document;
(iv) the misappropriation removal or misapplication by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor disposal of any funds personal property during the existence of an Event of Default, unless such personal property is removed or disposed of in violation the ordinary course of the Loan Documents (including misappropriation business and replaced with personal property of equal or misapplication of Revenues, security deposits and/or Loss Proceeds)greater value;
(v) any voluntary Debt incurred the misapplication or conversion by Borrower if and or Operating Lessee of (A) any insurance proceeds, (B) any condemnation awards, or (C) any rents during the existence of an Event of Default or any Rents collected for more than one (1) month in advance to the extent such Rents are not applied to the continued existence costs of such Debt is prohibited hereundermaintenance and operation of the Property or to amounts due under the loan documents;
(vi) the failure to pay charges for labor or materials or other charges that can create a lien on the Property, provided, neither borrower nor any guarantor shall have liability for such losses (I) if gross revenues from the Property were insufficient to pay all such amounts, except to the extent Borrower or Operating Lessee has paid (during the relevant period) any sums due to any Affiliate of Borrower or any guarantor, or (II) if funds were available in the cash management account to pay such charges and could have been applied in accordance with the loan documents, but Lender or its agent intentionally did not pay such charges or did not pay such charges as a result of their gross negligence.
(vii) Borrower or Operating Lessee incurs voluntary unsecured debt prohibited under the loan documents (for these purposes, debt will be regarded as voluntary if either incurred voluntarily, or incurred involuntarily but subsequently not repaid despite the availability of sufficient cash flow from the Property);
(viii) any security deposits, advance deposits or any other deposits collected with respect to the Property which are not delivered to Lender upon a foreclosure of the Property or action in lieu thereof;
(ix) Borrower’s indemnification of Lender in connection with a securitization of the loan as provided in the loan documents;
(x) Borrower’s failure to pay any Taxes or assessments affecting the Property, or to obtain and maintain in full force and effect insurance policies as required by the Policies loan documents or pay the amount of any insurance deductible required thereunder following a Casualty casualty or other insurance claim, provided that current provided, neither borrower nor any guarantor shall have liability for such losses (I) if gross revenues from the Property were insufficient to pay all such amounts, except to the extent Borrower or operating lessee has paid (during the relevant period) any sums due to any affiliate of borrower or any guarantor, or (II) if funds were available in the cash flow is sufficient management account to pay such charges and available could have been applied in accordance with the loan documents, but Lender or its agent intentionally did not pay such charges or did not pay such charges as a result of their gross negligence; or
(xi) intentional or grossly negligent waste;
(xii) any shortfall in the amount required to be contained in the Qualified FF&E Account pursuant to the Approved Management Agreement for payment loan documents to the extent such amounts were not otherwise applied to operation of same and provided Lender permits cash flow from the Property in accordance with the loan documents (excluding sums paid to be applied for such purposeany affiliate of Borrower or Guarantor);
(viixiii) the failure of Borrower fees or commissions paid to be, and to at all times have been, a Single-Purpose Entity, regardless of whether such failure to have been a Single-Purpose Entity prior to the date hereof has been disclosed to Lender, and including any and all liabilities, contingent or otherwise, arising from or related to (x) the actions, conduct and/or operating history of Borrower (or any Person merged into Borrower) prior to the Closing Date and (y) Borrower’s ownership (or the ownership of any Person merged into Borrower) of assets prior to the Closing Date that do not constitute a portion of the Collateral;
(viii) removal of personal property by Borrower from the Property outside of the ordinary course of business during the continuance of an Event of Default affiliates in violation of the Loan Agreement, unless replaced with personal property loan documents; or
(xiv) Borrower or Operating Lessee fails to permit on-site inspections of the same utility Property, fails to provide financial information, or fails to appoint a new property manager upon the request of Lender, each as required by, and in accordance with the terms and provisions of the same or greater value and utility; and
(ix) any fees or commissions paid by Borrower to any affiliate in violation of the terms of the Loan Documentsloan documents. In addition to the foregoing, the Loan shall be fully recourse to Borrower and Sponsor, jointly and severally, if upon (i1) there is any unauthorized Transfer of the Property or any other Collateral (including voluntary Liens and encumbrances on the Collateral other than Permitted Encumbrances) or Prohibited Change of Control or Prohibited Pledge, in each case, in a violation of the Loan Documents, (ii) any petition for bankruptcy, insolvency, dissolution or liquidation under the Bankruptcy Code or any similar federal or state law is filed by, consented to, or acquiesced in by, Borrower, (iii) Borrower or any of its affiliates (including Sponsor) shall have colluded with other creditors to cause an involuntary filing under the Bankruptcy Code or similar federal or state law with respect to Borrower, or Borrower shall have terminated one or more of the Independent Directors for the purpose of facilitating a bankruptcy filing, or (iv) Borrower fails to be, and to at all times have been, a Single-Purpose Entity, which failure Entity covenant that results in a substantive consolidation of Borrower with any affiliate in a bankruptcy or similar proceeding (or the filing of a motion for substantive consolidation in bankruptcy citing any such violation which is not dismissed, provided that, in the event such motion is dismissed, Borrower and Sponsor shall nonetheless be liable for Lender’s actual damages arising from or relating to such filing or proceeding. All of Borrower); (2) Borrower fails to obtain Lender’s liabilities under this Section 9.19(bconsent to any secured indebtedness or voluntary lien encumbering the Property or any part thereof; (3) shall be guaranteed by Sponsor pursuant Borrower fails to obtain Lender’s prior consent to any transfer the Property or any part thereof or interest therein, except to the Guarantyextent expressly permitted by the loan documents; (4) Borrower files a voluntary petition under the Bankruptcy Code or any other Federal or state bankruptcy or insolvency law; (5) Borrower files an answer consenting to or otherwise acquiescing in or joining in any involuntary petition filed against it by any other Person under the Bankruptcy Code or any other Federal or state bankruptcy or insolvency law, or solicits or causes to be solicited petitioning creditors for any involuntary petition from any Person; (6) Borrower makes an assignment for the benefit of creditors, or admits, in writing or in any legal proceeding, its insolvency.
(c) The foregoing limitations on personal liability shall in no way impair or constitute a waiver of the validity of the Notes, the Indebtedness secured by the Collateral, or the Liens on the Collateral, or the right of Lender, as mortgagee or secured party, to foreclose and/or enforce its rights with respect to the Collateral after an Event of Default. Nothing in this Agreement shall be deemed to be a waiver of any right which Lender may have under the Bankruptcy Code to file a claim for the full amount of the debt owing to Lender by Borrower or to require that all Collateral shall continue to secure all of the Indebtedness owing to Lender in accordance with the Loan Documents. Lender may seek a judgment on the Note (and, if necessary, name Borrower in such suit) as part of judicial proceedings to foreclose on under the Mortgage or to foreclose pursuant to any Collateral other Loan Documents, or as a prerequisite to any such foreclosure or to confirm any foreclosure or sale pursuant to power of sale thereunder, and in the event any suit is brought on the Note(s)Notes, or with respect to any Indebtedness or any judgment rendered in such judicial proceedings, such judgment shall constitute a Lien on and may will be and can be enforced on and against the Collateral and the rents, profits, issues, products and proceeds thereof. Nothing in this Agreement shall impair the right of Lender to accelerate the maturity of the Note during upon the continuance occurrence of an Event of Default in accordance with the Loan DocumentsDefault, nor shall anything in this Agreement impair or be construed to impair the right of Lender to seek personal judgments, and to enforce all rights and remedies under applicable law, jointly and severally against any indemnitors and guarantors to the extent allowed by any applicable Loan Documentsguarantees. The provisions set forth in this Section 9.19 are not intended as a release or discharge of the obligations due under the Note or under any Loan Documents, but are intended as a limitation, to the extent provided in this Section, on Lender’s right to ▇▇▇ for a deficiency or seek a personal judgment against Borrower or Sponsor except as required in order to realize on the Collateral.
(d) For the avoidance of doubt, the failure to pay trade payables as a result of insufficient cash flow from the Property shall not trigger liability under this Section 9.19.
Appears in 1 contract
Recourse. (a) Subject If a Purchaser Indemnitee is entitled to a recovery under this Section 6.10 then such recovery shall first be made by (i) setting off Damages against amounts otherwise payable by Purchaser to the qualifications hereinSeller pursuant to this Agreement, Lender shall not enforce Borrower’s obligation including pursuant to pay the Indebtedness by any action or proceeding wherein a deficiency judgment or other judgment establishing personal liability Promissory Note (the “Set-off”), and then (ii) recovery directly from the Seller, first, and the Equityholders, second, which shall be sought against Borrower or any of its affiliates, or any Exculpated Person, except for foreclosure actions or any other appropriate actions or proceedings against Borrower payable by Seller and/or the Equityholders in order to fully exercise Lender’s remedies in respect of, and to realize upon, the Collateral, and except for any actions to enforce any obligations expressly assumed or guaranteed by any guarantor, indemnitor or similar party (whether or not such party is an Exculpated Person) under the Loan Documents; provided however such foreclosure or appropriate actions or proceedings against Borrower shall, in no event, seek to enforce Borrower’s obligation to pay the Indebtedness or other personal judgments against Borrowercash.
(b) Borrower shall indemnify Lender and hold Lender harmless from and against any and all Damages to Lender (including the legal and other expenses of enforcing the obligations of Borrower under this Section and Sponsor under the Guaranty) resulting from or arising out of any The exercise of the following:
right of Set-Off by Purchaser hereunder shall not be exercised unless and until (i) any intentional physical Waste at the Property committed Representative and Purchaser Indemnitees agree that the Seller or permitted by BorrowerEquityholders are liable for Damages or, Sponsor or any affiliate Controlled by Borrower and/or Sponsor;
(ii) any fraud a final, binding, non-appealable order by a court of competent jurisdiction is entered finding the Seller or intentional misrepresentation in connection with the Loan committed by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor;
(iii) any willful misconduct by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor (including any bad faith interference by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor with the exercise any rights and remedies available to Lender as provided herein and in the other Loan Documents during the continuance of an Event of Default);
(iv) the misappropriation or misapplication by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor of any funds in violation of the Loan Documents (including misappropriation or misapplication of Revenues, security deposits and/or Loss Proceeds);
(v) any voluntary Debt incurred by Borrower if and to the extent the continued existence of such Debt is prohibited hereunder;
(vi) the failure to pay or maintain the Policies or pay the amount of any deductible required thereunder following a Casualty or other insurance claim, provided that current cash flow is sufficient and available pursuant to the Approved Management Agreement Equityholders liable for payment of same and provided Lender permits cash flow from the Property to be applied for such purpose;
(vii) the failure of Borrower to be, and to at all times have been, a Single-Purpose Entity, regardless of whether such failure to have been a Single-Purpose Entity prior to the date hereof has been disclosed to Lender, and including any and all liabilities, contingent or otherwise, arising from or related to (x) the actions, conduct and/or operating history of Borrower (or any Person merged into Borrower) prior to the Closing Date and (y) Borrower’s ownership (or the ownership of any Person merged into Borrower) of assets prior to the Closing Date that do not constitute a portion of the Collateral;
(viii) removal of personal property by Borrower from the Property outside of the ordinary course of business during the continuance of an Event of Default in violation of the Loan Agreement, unless replaced with personal property of the same utility and of the same or greater value and utility; and
(ix) any fees or commissions paid by Borrower to any affiliate in violation of the terms of the Loan DocumentsDamages. In addition to Notwithstanding the foregoing, the Loan Purchaser may withhold payments otherwise due under this Agreement or the Promissory Note pending the determination of Seller’s liability for Damages. Prior to withholding any amounts due under this Agreement or the Promissory Note, Purchaser shall be fully recourse give written notice of such intention to Borrower the Representative. If it is agreed upon by the Representative and Sponsor, jointly and severally, if (i) there is any unauthorized Transfer of Purchaser Indemnitee that the Property Seller or any other Collateral (including voluntary Liens and encumbrances on the Collateral other than Permitted Encumbrances) or Prohibited Change of Control or Prohibited Pledge, in each case, in violation of the Loan Documents, (ii) any petition Equityholders are not liable for bankruptcy, insolvency, dissolution or liquidation under the Bankruptcy Code or any similar federal or state law is filed by, consented toDamages, or acquiesced in bya court of competent jurisdiction enters a final, Borrowerbinding and non-appealable order finding the Seller or Equityholders are not liable for such Damages, (iii) Borrower or any then Purchaser shall pay all amounts withheld and interest accrued thereon during such period of its affiliates (including Sponsor) shall have colluded with other creditors to cause an involuntary filing under the Bankruptcy Code or similar federal or state law with respect to Borrower, or Borrower shall have terminated one or more of the Independent Directors for the purpose of facilitating a bankruptcy filing, or (iv) Borrower fails to be, and to at all times have been, a Single-Purpose Entity, which failure results in a substantive consolidation of Borrower with any affiliate in a bankruptcy or similar proceeding. All of Borrower’s liabilities under this Section 9.19(b) shall be guaranteed by Sponsor pursuant time to the GuarantyRepresentative within ten (10) Business Days of such agreement or entry of such order.
(c) The foregoing limitations on personal liability shall in no way impair or constitute a waiver If the Purchaser’s right of Set-Off is insufficient to cover the entirety of the validity Damages to which it is entitled to recover under this Section 6.10, then the Seller or Equityholders shall pay to the Purchaser Indemnitees the amount for which it is liable under this Section 6.10 within ten (10) Business Days of the Notes, the Indebtedness secured by the Collateral, or the Liens on the Collateral, or the right of Lender, Representative’s and Purchaser Indemnitee’s agreement as mortgagee or secured party, to foreclose and/or enforce its rights with respect to the Collateral after an Event of Default. Nothing in this Agreement shall be deemed to be a waiver of any right which Lender may have under the Bankruptcy Code to file a claim for the full amount of the debt owing to Lender by Borrower Seller’s or to require that all Collateral shall continue to secure all of the Indebtedness owing to Lender in accordance with the Loan Documents. Lender may seek a judgment on the Note (andEquityholder’s liability or, if necessaryno agreement is reached, name Borrower in such suitupon the entry of a final, binding, non-appealable order by a court of competent jurisdiction.
(d) as part of judicial proceedings to foreclose on any Collateral or as a prerequisite to any such foreclosure or to confirm any foreclosure or sale pursuant to power of sale thereunder, If and in the event any suit is brought on the Note(s), or with respect to any Indebtedness or any judgment rendered in such judicial proceedings, such judgment shall constitute a Lien on and may be enforced on and against the Collateral and the rents, profits, issues, products and proceeds thereof. Nothing in this Agreement shall impair the right of Lender to accelerate the maturity of the Note during the continuance of an Event of Default in accordance with the Loan Documents, nor shall anything in this Agreement impair or be construed to impair the right of Lender to seek personal judgments, and to enforce all rights and remedies under applicable law, jointly and severally against any indemnitors and guarantors to the extent allowed by that any applicable Loan Documents. The provisions Seller Indemnified Person is entitled to indemnification pursuant to this Agreement (after giving effect to the limitations on indemnification set forth in this Section are not intended as a release or discharge 6.10), any such indemnification claims will be satisfied by payment of such Damages in cash from Purchaser to Representative for further distribution to the Seller Indemnified Persons within ten (10) Business Days after the determination thereof by agreement of the obligations due under Representative and Purchaser as to Purchaser’s liability or, if no agreement is reached, upon the Note or under any Loan Documentsentry of a final, but are intended as binding, non-appealable order by a limitation, to the extent provided in this Section, on Lender’s right to ▇▇▇ for a deficiency or seek a personal judgment except as required in order to realize on the Collateralcourt of competent jurisdiction.
(d) For the avoidance of doubt, the failure to pay trade payables as a result of insufficient cash flow from the Property shall not trigger liability under this Section 9.19.
Appears in 1 contract
Sources: Asset Purchase Agreement (Medicine Man Technologies, Inc.)
Recourse. (a) Subject Indemnitor agrees that the obligations of Indemnitor hereunder are separate, independent of and in addition to Indemnitor's obligations under the qualifications herein, Lender shall not enforce Borrower’s obligation to pay the Indebtedness by any action or proceeding wherein a deficiency judgment or other judgment establishing personal liability shall be sought against Borrower or any of its affiliates, or any Exculpated Person, except for foreclosure actions Credit Agreement or any other appropriate actions or proceedings against Borrower in order to fully exercise Lender’s remedies in respect of, and to realize upon, the Collateral, and except for any actions to enforce any obligations expressly assumed or guaranteed by any guarantor, indemnitor or similar party (whether or not such party is an Exculpated Person) under the Loan Documents; provided however such foreclosure or appropriate actions or proceedings against Borrower shall, in no event, seek to enforce Borrower’s obligation to pay the Indebtedness or other personal judgments against BorrowerCredit Document.
(b) Borrower Indemnitor agrees that a separate action may be brought to enforce the provisions of this Indemnity, which shall indemnify Lender and hold Lender harmless from and in no way be deemed to be an action on the Credit Party Obligations, whether or not the Lenders would be entitled to a deficiency judgment following a judicial foreclosure or sale under any Deed of Trust. Indemnitor waives any right to require that any action be brought by the Lenders against Indemnitor or any and all Damages to Lender (including the legal and other expenses of enforcing the obligations of Borrower under this Section and Sponsor Person, or that any other remedy under the Guaranty) resulting from or arising out of Credit Agreement, this Indemnity, any of the following:
(i) any intentional physical Waste at the Property committed or permitted by Borrowerother Credit Document, Sponsor or any affiliate Controlled other document entered into by Borrower and/or Sponsor;
(ii) any fraud or intentional misrepresentation Indemnitor in connection with the Loan committed by Borrowerforegoing be exercised. The Lenders may, Sponsor or any affiliate Controlled by Borrower and/or Sponsor;
(iii) any willful misconduct by Borrowerat their option, Sponsor or any affiliate Controlled by Borrower and/or Sponsor (including any bad faith interference by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor with the exercise any rights and remedies available to Lender as provided herein and proceed against Indemnitor in the other Loan Documents during the continuance of an Event of Default);
(iv) the misappropriation first instance to collect monies when due or misapplication by Borrowerto obtain performance under this Indemnity, Sponsor or any affiliate Controlled by Borrower and/or Sponsor of any funds in violation of the Loan Documents (including misappropriation or misapplication of Revenues, security deposits and/or Loss Proceeds);
(v) any voluntary Debt incurred by Borrower if and to the extent the continued existence of such Debt is prohibited hereunder;
(vi) the failure to pay or maintain the Policies or pay the amount of any deductible required thereunder following a Casualty or other insurance claim, provided that current cash flow is sufficient and available pursuant to the Approved Management Agreement for payment of same and provided Lender permits cash flow from the Property to be applied for such purpose;
(vii) the failure of Borrower to be, and to at all times have been, a Single-Purpose Entity, regardless of whether such failure to have been a Single-Purpose Entity prior to the date hereof has been disclosed to Lender, and including any and all liabilities, contingent or otherwise, arising from or related to (x) the actions, conduct and/or operating history of Borrower (or any Person merged into Borrower) prior to the Closing Date and (y) Borrower’s ownership (or the ownership of any Person merged into Borrower) of assets prior to the Closing Date that do not constitute a portion of the Collateral;
(viii) removal of personal property by Borrower from the Property outside of the ordinary course of business during the continuance of an Event of Default in violation of the Loan Agreement, unless replaced with personal property of the same utility and of the same or greater value and utility; and
(ix) any fees or commissions paid by Borrower to any affiliate in violation of the terms of the Loan Documents. In addition to the foregoing, the Loan shall be fully recourse to Borrower and Sponsor, jointly and severally, if (i) there is any unauthorized Transfer of the Property without first proceeding against Indemnitor or any other Collateral (including voluntary Liens indemnitor or any other Person and encumbrances on without first resorting to any other indemnity, the Collateral Credit Agreement, this Indemnity, any Credit Document, or any other than Permitted Encumbrances) document entered into by Indemnitor in connection with the foregoing or Prohibited Change of Control or Prohibited Pledge, in each case, in violation of the Loan Documents, (ii) any petition for bankruptcy, insolvency, dissolution or liquidation other remedy under the Bankruptcy Code Credit Agreement, this Indemnity, any Credit Document, or any similar federal or state law is filed by, consented to, or acquiesced other document entered into by Indemnitor in by, Borrower, (iii) Borrower or any of its affiliates (including Sponsor) shall have colluded connection with other creditors to cause an involuntary filing under the Bankruptcy Code or similar federal or state law with respect to Borrower, or Borrower shall have terminated one or more of the Independent Directors for the purpose of facilitating a bankruptcy filing, or (iv) Borrower fails to be, and to at all times have been, a Single-Purpose Entity, which failure results in a substantive consolidation of Borrower with any affiliate in a bankruptcy or similar proceeding. All of Borrower’s liabilities under this Section 9.19(b) shall be guaranteed by Sponsor pursuant to the Guarantyforegoing.
(c) The foregoing limitations on personal liability shall in no way impair or constitute a waiver This Indemnity is not given as additional security for the Credit Party Obligations and is entirely independent of the validity Credit Party Obligations (except as provided in Section 5), and shall not be measured or affected by any amounts at any time owing under the other Credit Documents, the sufficiency or insufficiency of any collateral (including without limitation the Premises) given to the Lenders to secure repayment of the NotesCredit Party Obligations, or the Indebtedness consideration given by the Lenders or any other party in order to acquire the Premises or any portion thereof. None of the obligations of Indemnitor hereunder shall be in any way secured by the Collateral, or the Liens on the Collateral, or the right of Lender, as mortgagee or secured party, to foreclose and/or enforce its rights with respect to the Collateral after an Event of Default. Nothing in this Agreement shall be deemed to be a waiver of any right which Lender may have under the Bankruptcy Code to file a claim for the full amount lien of the debt owing to Lender by Borrower or to require that all Collateral shall continue to secure all Deed of the Indebtedness owing to Lender in accordance with the Loan Documents. Lender may seek a judgment on the Note (and, if necessary, name Borrower in such suit) as part of judicial proceedings to foreclose on any Collateral or as a prerequisite to any such foreclosure or to confirm any foreclosure or sale pursuant to power of sale thereunder, and in the event any suit is brought on the Note(s), or with respect to any Indebtedness Trust or any judgment rendered in such judicial proceedings, such judgment shall constitute a Lien on and may be enforced on and against the Collateral and the rents, profits, issues, products and proceeds thereof. Nothing in this Agreement shall impair the right of Lender to accelerate the maturity of the Note during the continuance of an Event of Default in accordance with the Loan Documents, nor shall anything in this Agreement impair or be construed to impair the right of Lender to seek personal judgments, and to enforce all rights and remedies under applicable law, jointly and severally against any indemnitors and guarantors to the extent allowed by any applicable Loan Documents. The provisions set forth in this Section are not intended as a release or discharge of the obligations due under the Note or under any Loan Documents, but are intended as a limitation, to the extent provided in this Section, on Lender’s right to ▇▇▇ for a deficiency or seek a personal judgment except as required in order to realize on the Collateralother Credit Document.
(d) For the avoidance of doubt, the failure to pay trade payables as a result of insufficient cash flow from the Property shall not trigger liability under this Section 9.19.
Appears in 1 contract
Recourse. (a) Subject to the qualifications herein, Lender shall not enforce Borrower’s obligation to pay the Indebtedness by any action or proceeding wherein a deficiency judgment or other judgment establishing personal liability shall be sought against Borrower or any of its affiliates, or any Exculpated Person, except for foreclosure actions or any other appropriate actions or proceedings against Borrower in order to fully exercise Lender’s remedies in respect of, and to realize upon, the Collateral, and except for any actions to enforce any obligations expressly assumed or guaranteed by any guarantor, indemnitor or similar party (whether or not such party is an Exculpated Person) under the Loan Documents; provided however such foreclosure or appropriate actions or proceedings against Borrower shall, in no event, seek to enforce Borrower’s obligation to pay the Indebtedness or other personal judgments against Borrower.
(b) Borrower (but not any Exculpated Person, except Sponsor) shall indemnify Lender and hold Lender harmless from and against any and all Damages to Lender (including the legal and other expenses of enforcing the obligations of Borrower under this Section and the Sponsor under the Guaranty) resulting from or arising out of any of the followingfollowing (the “Indemnified Liabilities”), which Indemnified Liabilities shall be guaranteed by Sponsor pursuant to the Guaranty:
(i) any intentional or grossly negligent material physical Waste at the Property committed or permitted by Borrower, Operating Lessee, the Sponsor or any affiliate Controlled by Borrower and/or Sponsorof their respective affiliates;
(ii) any fraud or intentional willful misrepresentation in connection with the Loan committed by Borrower, Operating Lessee, the Sponsor or any affiliate Controlled by Borrower and/or Sponsorof their respective affiliates;
(iii) any willful misconduct by Borrower, Operating Lessee the Sponsor or any affiliate Controlled by Borrower and/or Sponsor of their respective affiliates (including any bad faith wrongful interference by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor such Person with the exercise any rights and of remedies available to by Lender as provided herein and in the other Loan Documents during the continuance of an Event of Default);
(iv) the misappropriation or intentional misapplication by Borrower, Operating Lessee, the Sponsor or any affiliate Controlled by Borrower and/or Sponsor of their respective affiliates of any funds in violation of the Loan Documents (Documents, including the failure to comply with the first sentence of Section 3.1(a) and misappropriation or intentional misapplication of Revenues, security deposits deposits, Loss Proceeds (to the extent not applied toward repayment of the Loan or restoration of the Property pursuant to this Agreement) and/or Loss Proceeds)amounts contained in the Approved FF&E Account or Approved Operating Account;
(v) any voluntary Debt incurred by Borrower or Operating Lessee if and to the extent the continued existence of such Debt is prohibited hereunderhereunder (excluding , however, any Debt that constituted Permitted Debt on the date that it was incurred);
(vi) any breach by Borrower, Operating Lessee or the Sponsor of any representation or covenant regarding environmental matters contained in this Agreement or in the Environmental Indemnity;
(vii) the failure to pay or maintain the Policies or pay the amount of any deductible required thereunder following a Casualty or other insurance claim, provided that current cash flow is sufficient and available pursuant to the Approved Management Agreement for payment of same and provided Lender permits cash flow from the Property is sufficient for such purpose (it being agreed that cash flow from the Property shall be deemed to have been sufficient if cash flow during the immediately prior policy year would have been sufficient to accumulate sufficient funds in a reserve account to fully pay premiums for the Policies for the policy year in question, had Lender been reserving funds in respect of the Policies during such immediately prior policy year) and Lender permits the same to be applied for such purpose, (and neither Borrower nor Sponsor shall have an liability under this clause (vii) for Damages that arise from Lender’s failure to properly apply amounts reserved by Lender, if any, for the purpose of paying insurance premiums);
(viiviii) the failure of Borrower or Operating Lessee to be, and to at all times have been, a Single-Purpose EntityEntity (for the avoidance of doubt, regardless of whether such failure to have been a Single-Purpose Entity prior the recourse described in this clause shall be in addition to the date hereof has been disclosed to Lenderfull recourse for a substantive consolidation described below), and including any and all liabilities, contingent or otherwise, arising from or related to (x) except for the actions, conduct and/or operating history unilateral resignation of Borrower (or any Person merged into Borrower) prior to the Closing Date and (y) Borrower’s ownership (or the ownership of any Person merged into Borrower) of assets prior to the Closing Date that do not constitute a portion of the Collateralan Independent Director;
(viiiix) removal of personal property by Borrower or FF&E from the Property outside of the ordinary course of business during the continuance or in anticipation of an Event of Default in violation Default, except as a result of the Loan Agreement, obsolescence or unless replaced with personal property of the same utility and or FF&E of the same or greater value and utility; and;
(ixx) any fees or commissions paid by Borrower or Operating Lessee to any affiliate in violation of the terms of the Loan Documents; and
(xi) the failure to fund the Approved FF&E Account in accordance with this Agreement (it being agreed that Damages in such event shall include the amount of any funds not deposited into the Approved FF&E Account), provided cash flow from the Property is sufficient for such purpose and Lender permits the same to be applied for such purpose. In addition to the foregoing, the Loan shall be fully recourse to Borrower and Sponsor, jointly and severally, if (i) there is any unauthorized Transfer of the Property or any other unauthorized transfer of any Collateral (including voluntary Liens and encumbrances on Account, the Collateral other than Permitted Encumbrances) Approved Operating Account, the Approved FF&E Account or any Prohibited Change of Control or Prohibited PledgeControl, in each case, in violation of the Loan Documents, (ii) any petition for bankruptcy, insolvency, dissolution or liquidation under the Bankruptcy Code or any similar federal or state law is filed by, consented to, or acquiesced in by, Borrowerany Required SPE, (iii) Borrower any Required SPE or any of its their respective affiliates (including Sponsor) shall have colluded with other creditors to cause an involuntary bankruptcy filing under the Bankruptcy Code or similar federal or state law with respect to Borrower, or Borrower shall have terminated one or more of the Independent Directors for the purpose of facilitating a bankruptcy filingany Required SPE, or (iv) Borrower any Required SPE fails to be, and to at all times have been, a Single-Purpose Entity, which failure results in a substantive consolidation of Borrower and/or Operating Lessee with any affiliate in a bankruptcy or similar proceeding. All of Borrower’s liabilities under this Section 9.19(b) The Loan shall be guaranteed by recourse to Sponsor pursuant in an amount equal to its unpaid Guaranteed Obligations (as such term is defined in the Completion Guaranty) under the Completion Guaranty.
(c) The foregoing limitations on personal liability shall in no way impair or constitute a waiver of the validity of the Notes, the Indebtedness secured by the Collateral, or the Liens on the Collateral, or the right of Lender, as mortgagee or secured party, to foreclose and/or enforce its rights with respect to the Collateral after an Event of Default. Nothing in this Agreement shall be deemed to be a waiver of any right which Lender may have under the Bankruptcy Code to file a claim for the full amount of the debt owing to Lender by Borrower or to require that all Collateral shall continue to secure all of the Indebtedness owing to Lender in accordance with the Loan Documents. Lender may seek a judgment on the Note (and, if necessary, name Borrower in such suit) as part of judicial proceedings to foreclose on any Collateral or as a prerequisite to any such foreclosure or to confirm any foreclosure or sale pursuant to power of sale thereunder, and in the event any suit is brought on the Note(s)Notes, or with respect to any Indebtedness or any judgment rendered in such judicial proceedings, such judgment shall constitute a Lien on and may be enforced on and against the Collateral and the rents, profits, issues, products and proceeds thereof. Nothing in this Agreement shall impair the right of Lender to accelerate the maturity of the Note during upon the continuance occurrence of an Event of Default in accordance with the Loan DocumentsDefault, nor shall anything in this Agreement impair or be construed to impair the right of Lender to seek personal judgments, and to enforce all rights and remedies under applicable law, jointly and severally against any indemnitors and guarantors to the extent allowed by any applicable Loan Documents. The provisions set forth in this Section are not intended as a release or discharge of the obligations due under the Note or under any Loan Documents, but are intended as a limitation, to the extent provided in this Section, on Lender’s right to ▇▇▇ for a deficiency or seek a personal judgment except as required in order to realize on the Collateral.
(d) For the avoidance of doubt, the failure to pay trade payables as a result of insufficient cash flow from the Property shall not trigger liability under this Section 9.19.
Appears in 1 contract
Recourse. (a) Subject Agent and Lenders shall have full recourse against Borrower for any liability or obligation of Borrower under this Agreement and the other Building Loan Documents. Neither Lenders nor Agent nor any of them shall have any recourse against, or the right to enforce the qualifications hereinliability and obligation of, Lender shall not enforce Borrower’s obligation the other Borrower Entities to pay perform and observe the Indebtedness obligations contained in this Agreement or any other Building Loan Documents by any action or proceeding wherein a deficiency judgment or brought against any such other judgment establishing personal liability shall be sought against Borrower or any of its affiliatesEntity other than (1) as expressly provided in the Guaranties, or any Exculpated Person, except for foreclosure actions or any other appropriate actions or proceedings against agreement hereafter executed and delivered to Agent by such other Borrower in order to fully exercise Lender’s remedies in respect of, and to realize upon, the Collateral, and except for any actions to enforce any obligations expressly assumed or guaranteed by any guarantor, indemnitor or similar party (whether or not such party is an Exculpated Person) under the Loan Documents; provided however such foreclosure or appropriate actions or proceedings against Borrower shall, in no event, seek to enforce Borrower’s obligation to pay the Indebtedness or other personal judgments against Borrower.
(b) Borrower shall indemnify Lender and hold Lender harmless from and against any and all Damages to Lender (including the legal and other expenses of enforcing the obligations of Borrower under this Section and Sponsor under the Guaranty) resulting from or arising out of any of the following:
(i) any intentional physical Waste at the Property committed or permitted by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor;
(ii) any fraud or intentional misrepresentation Entity in connection with the Building Loan committed by Borrower, Sponsor or (2) against the collateral granted under the Security Documents or any affiliate Controlled other Building Loan Document. The provisions of this Section 11.16 shall not (i) constitute a waiver, release or impairment of any obligation evidenced or secured by Borrower and/or Sponsor;
any of the Building Loan Documents or the NYTC Completion Guaranty; (ii) affect the validity or enforceability of any Building Loan Document or the NYTC Completion Guaranty or any of the rights and remedies of Agent thereunder; or (iii) any willful misconduct by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor (including any bad faith interference by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor with the exercise any rights and remedies available to Lender as provided herein and in the other Loan Documents during the continuance of an Event of Default);
(iv) the misappropriation or misapplication by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor of any funds in violation of the Loan Documents (including misappropriation or misapplication of Revenues, security deposits and/or Loss Proceeds);
(v) any voluntary Debt incurred by Borrower if and to the extent the continued existence of such Debt is prohibited hereunder;
(vi) the failure to pay or maintain the Policies or pay the amount of any deductible required thereunder following a Casualty or other insurance claim, provided that current cash flow is sufficient and available pursuant to the Approved Management Agreement for payment of same and provided Lender permits cash flow from the Property to be applied for such purpose;
(vii) the failure of Borrower to be, and to at all times have been, a Single-Purpose Entity, regardless of whether such failure to have been a Single-Purpose Entity prior to the date hereof has been disclosed to Lender, and including any and all liabilities, contingent or otherwise, arising from or related to (x) the actions, conduct and/or operating history of Borrower (or any Person merged into Borrower) prior to the Closing Date and (y) Borrower’s ownership (or the ownership of any Person merged into Borrower) of assets prior to the Closing Date that do not constitute a portion of the Collateral;
(viii) removal of personal property by Borrower from the Property outside of the ordinary course of business during the continuance of an Event of Default in violation of the Loan Agreement, unless replaced with personal property of the same utility and of the same or greater value and utility; and
(ix) any fees or commissions paid by Borrower to any affiliate in violation of the terms of the Loan Documents. In addition to the foregoing, the Loan shall be fully recourse to Borrower and Sponsor, jointly and severally, if (i) there is any unauthorized Transfer of the Property or any other Collateral (including voluntary Liens and encumbrances on the Collateral other than Permitted Encumbrances) or Prohibited Change of Control or Prohibited Pledge, in each case, in violation of the Loan Documents, (ii) any petition for bankruptcy, insolvency, dissolution or liquidation under the Bankruptcy Code or any similar federal or state law is filed by, consented to, or acquiesced in by, Borrower, (iii) Borrower or any of its affiliates (including Sponsor) shall have colluded with other creditors to cause an involuntary filing under the Bankruptcy Code or similar federal or state law with respect to Borrower, or Borrower shall have terminated one or more of the Independent Directors for the purpose of facilitating a bankruptcy filing, or (iv) Borrower fails to be, and to at all times have been, a Single-Purpose Entity, which failure results in a substantive consolidation of Borrower with any affiliate in a bankruptcy or similar proceeding. All of Borrower’s liabilities under this Section 9.19(b) shall be guaranteed by Sponsor pursuant to the Guaranty.
(c) The foregoing limitations on personal liability shall in no way impair or constitute a waiver of the validity of the Notes, the Indebtedness secured by the Collateral, or the Liens on the Collateral, or the right of Lender, as mortgagee or secured party, to foreclose and/or enforce its rights with respect to the Collateral after an Event of Default. Nothing in this Agreement shall be deemed to be a waiver of any right which Lender may have under the Bankruptcy Code to file a claim for the full amount of the debt owing to Lender by Borrower or to require that all Collateral shall continue to secure all of the Indebtedness owing to Lender in accordance with the Loan Documents. Lender may seek a judgment on the Note (and, if necessary, name Borrower in such suit) as part of judicial proceedings to foreclose on any Collateral or as a prerequisite to any such foreclosure or to confirm any foreclosure or sale pursuant to power of sale thereunder, and in the event any suit is brought on the Note(s), or with respect to any Indebtedness or any judgment rendered in such judicial proceedings, such judgment shall constitute a Lien on and may be enforced on and against the Collateral and the rents, profits, issues, products and proceeds thereof. Nothing in this Agreement shall impair the right of Lender Agent to accelerate obtain the maturity appointment of the Note during the continuance of an Event of Default in accordance with the Loan Documentsa receiver. No officer, nor shall anything in director, member, shareholder, limited partner, employee, agent, representative, beneficiary or trustee of, or any person executing this Agreement impair or any other Building Loan Document or the NYTC Completion Guaranty in a representative capacity on behalf of (solely by virtue of such execution) a Borrower Entity shall ever be construed personally liable hereunder for the obligations of such Borrower Entity, all liability of each Borrower Party being expressly limited to impair such Borrower Entity (or any general partner, joint venturer, or other person having liability for the right obligations of Lender to seek personal judgmentssuch Borrower Entity as a matter of law) and its assets, and all persons dealing with a Borrower Entity must look solely to enforce all rights such Borrower Entity (or any general partner, joint venturer, or other person having liability for the obligations of such Borrower Entity as a matter of law) and remedies under applicable law, jointly its assets for the enforcement of any claim against such Borrower Entity and severally against in no event shall any indemnitors and guarantors recourse be had to the extent allowed private property of any officer, director, member, shareholder, limited partner, employee, agent, representative, beneficiary or trustee of, or any person executing this agreement on behalf of (solely by any applicable Loan Documents. The provisions set forth in this Section are not intended as virtue of such execution), a release or discharge of the obligations due under the Note or under any Loan Documents, but are intended as a limitation, to the extent provided in this Section, on Lender’s right to ▇▇▇ for a deficiency or seek a personal judgment except as required in order to realize on the CollateralBorrower Entity.
(d) For the avoidance of doubt, the failure to pay trade payables as a result of insufficient cash flow from the Property shall not trigger liability under this Section 9.19.
Appears in 1 contract
Recourse. (a) Subject Indemnitor agrees that the obligations of Indemnitor hereunder are separate, independent of and in addition to Indemnitor's obligations under the qualifications herein, Lender shall not enforce Borrower’s obligation to pay the Indebtedness by any action or proceeding wherein a deficiency judgment or other judgment establishing personal liability shall be sought against Borrower or any of its affiliates, or any Exculpated Person, except for foreclosure actions Loan Agreement or any other appropriate actions or proceedings against Borrower in order to fully exercise Lender’s remedies in respect of, and to realize upon, the Collateral, and except for any actions to enforce any obligations expressly assumed or guaranteed by any guarantor, indemnitor or similar party (whether or not such party is an Exculpated Person) under the Loan Documents; provided however such foreclosure or appropriate actions or proceedings against Borrower shall, in no event, seek to enforce Borrower’s obligation to pay the Indebtedness or other personal judgments against BorrowerDocument.
(b) Borrower Indemnitor agrees that a separate action may be brought to enforce the provisions of this Indemnity, which shall indemnify in no way be deemed to be an action on the Obligations, whether or not the Lender and hold Group would be entitled to a deficiency judgment following a judicial foreclosure or sale under any Deed of Trust. Indemnitor waives any right to require that any action be brought by the Lender harmless from and Group against Indemnitor or any and all Damages to Lender (including the legal and other expenses of enforcing the obligations of Borrower under this Section and Sponsor Person, or that any other remedy under the Guaranty) resulting from or arising out of Loan Agreement, this Indemnity, any of the following:
(i) any intentional physical Waste at the Property committed or permitted by Borrowerother Loan Document, Sponsor or any affiliate Controlled other document entered into by Borrower and/or Sponsor;
(ii) any fraud or intentional misrepresentation Indemnitor in connection with the Loan committed by Borrowerforegoing be exercised. The Lender Group may, Sponsor at its option, proceed against Indemnitor in the first instance to collect monies when due or to obtain performance under this Indemnity, without first proceeding against Indemnitor or any affiliate Controlled by Borrower and/or Sponsor;
(iii) any willful misconduct by Borrower, Sponsor other indemnitor or any affiliate Controlled by Borrower and/or Sponsor (including other Person and without first resorting to any bad faith interference by Borrowerother indemnity, Sponsor or any affiliate Controlled by Borrower and/or Sponsor with the exercise any rights and remedies available to Lender as provided herein and in the other Loan Documents during the continuance of an Event of Default);
(iv) the misappropriation or misapplication by Borrower, Sponsor or any affiliate Controlled by Borrower and/or Sponsor of any funds in violation of the Loan Documents (including misappropriation or misapplication of Revenues, security deposits and/or Loss Proceeds);
(v) any voluntary Debt incurred by Borrower if and to the extent the continued existence of such Debt is prohibited hereunder;
(vi) the failure to pay or maintain the Policies or pay the amount of any deductible required thereunder following a Casualty or other insurance claim, provided that current cash flow is sufficient and available pursuant to the Approved Management Agreement for payment of same and provided Lender permits cash flow from the Property to be applied for such purpose;
(vii) the failure of Borrower to be, and to at all times have been, a Single-Purpose Entity, regardless of whether such failure to have been a Single-Purpose Entity prior to the date hereof has been disclosed to Lender, and including any and all liabilities, contingent or otherwise, arising from or related to (x) the actions, conduct and/or operating history of Borrower (or any Person merged into Borrower) prior to the Closing Date and (y) Borrower’s ownership (or the ownership of any Person merged into Borrower) of assets prior to the Closing Date that do not constitute a portion of the Collateral;
(viii) removal of personal property by Borrower from the Property outside of the ordinary course of business during the continuance of an Event of Default in violation of the Loan Agreement, unless replaced with personal property of the same utility and of the same or greater value and utility; and
(ix) this Indemnity, any fees or commissions paid by Borrower to any affiliate in violation of the terms of the Loan Documents. In addition to the foregoingDocument, the Loan shall be fully recourse to Borrower and Sponsor, jointly and severally, if (i) there is any unauthorized Transfer of the Property or any other Collateral (including voluntary Liens and encumbrances on document entered into by Indemnitor in connection with the Collateral foregoing or any other than Permitted Encumbrances) or Prohibited Change of Control or Prohibited Pledge, in each case, in violation of remedy under the Loan DocumentsAgreement, (ii) this Indemnity, any petition for bankruptcyLoan Document, insolvency, dissolution or liquidation under the Bankruptcy Code or any similar federal or state law is filed by, consented to, or acquiesced other document entered into by Indemnitor in by, Borrower, (iii) Borrower or any of its affiliates (including Sponsor) shall have colluded connection with other creditors to cause an involuntary filing under the Bankruptcy Code or similar federal or state law with respect to Borrower, or Borrower shall have terminated one or more of the Independent Directors for the purpose of facilitating a bankruptcy filing, or (iv) Borrower fails to be, and to at all times have been, a Single-Purpose Entity, which failure results in a substantive consolidation of Borrower with any affiliate in a bankruptcy or similar proceeding. All of Borrower’s liabilities under this Section 9.19(b) shall be guaranteed by Sponsor pursuant to the Guarantyforegoing.
(c) The foregoing limitations on personal liability shall in no way impair or constitute a waiver This Indemnity is not given as additional security for the Obligations and is entirely independent of the validity Obligations (except as provided in Section 5), and shall not be measured or affected by any amounts at any time owing under the other Loan Documents, the sufficiency or insufficiency of any collateral (including without limitation the Premises) given to the Lender Group to secure repayment of the NotesObligations, or the Indebtedness consideration given by the Lender Group or any other party in order to acquire the Premises or any portion thereof. None of the obligations of Indemnitor hereunder shall be in any way secured by the Collateral, or the Liens on the Collateral, or the right of Lender, as mortgagee or secured party, to foreclose and/or enforce its rights with respect to the Collateral after an Event of Default. Nothing in this Agreement shall be deemed to be a waiver of any right which Lender may have under the Bankruptcy Code to file a claim for the full amount lien of the debt owing to Lender by Borrower or to require that all Collateral shall continue to secure all Deed of the Indebtedness owing to Lender in accordance with the Loan Documents. Lender may seek a judgment on the Note (and, if necessary, name Borrower in such suit) as part of judicial proceedings to foreclose on any Collateral or as a prerequisite to any such foreclosure or to confirm any foreclosure or sale pursuant to power of sale thereunder, and in the event any suit is brought on the Note(s), or with respect to any Indebtedness Trust or any judgment rendered in such judicial proceedings, such judgment shall constitute a Lien on and may be enforced on and against the Collateral and the rents, profits, issues, products and proceeds thereof. Nothing in this Agreement shall impair the right of Lender to accelerate the maturity of the Note during the continuance of an Event of Default in accordance with the other Loan Documents, nor shall anything in this Agreement impair or be construed to impair the right of Lender to seek personal judgments, and to enforce all rights and remedies under applicable law, jointly and severally against any indemnitors and guarantors to the extent allowed by any applicable Loan Documents. The provisions set forth in this Section are not intended as a release or discharge of the obligations due under the Note or under any Loan Documents, but are intended as a limitation, to the extent provided in this Section, on Lender’s right to ▇▇▇ for a deficiency or seek a personal judgment except as required in order to realize on the CollateralDocument.
(d) For the avoidance of doubt, the failure to pay trade payables as a result of insufficient cash flow from the Property shall not trigger liability under this Section 9.19.
Appears in 1 contract